Chamber and committees

When it comes to listening to employers, would the minister care to remember that the business community is telling us very bluntly that many of the issues that it is facing now are partly issues about productivity, growth and investment, which are Scotland-related problems that are not to do with the UK?

I will not give way just now.

There is plenty of evidence that demonstrates that several of the current problems existed long before Brexit or Covid. One need take only a cursory look at the evidence that has been supplied to Parliament’s Finance and Public Administration Committee by bodies including the Scottish Fiscal Commission—which is mentioned in the Labour amendment—and the Fraser of Allander Institute to recognise that there are much more deep-seated problems at stake.

Let me outline some of those problems. First, there are inherent structural weaknesses in the Scottish labour market, which have created skills shortages and insecure employment in key sectors and which, together with a higher-than-average ageing population, are creating serious challenges and impacting on the potential for stronger economic growth and long-term investment.

Those issues have been created not by Brexit but by Scottish National Party ministers, who sometimes refuse to listen to the business community and to put in place policies that will address problems. My colleagues will talk more about the detail of failures to, for example, close the skills gap, widen apprenticeship opportunities and help employers to upskill and reskill their workforce.

Like the rest of us in this chamber, the First Minister received a letter from Scotland’s outdoor education centres earlier this week, which set out the blunt financial plight that they are facing. Many of those centres are facing closure, including those in Mid Scotland and Fife. What will the urgent response from the Scottish Government be?

How is the Scottish Government responding to requests from the business community for long-term reform of the structure of business rates?

Good morning. Cabinet secretary, I know that you are keen that we stick to the facts that are contained within the Scottish Fiscal Commission forecast, which informed your budget, and I will try very hard to do so. Just before I come to questions about some of the Scottish Fiscal Commission’s comments, I turn to page 104 of the Scottish Government consolidated accounts for 2020-21, which shows an underspend of £580 million, broken down across portfolios. Some portfolios have an overspend but some have a very considerable underspend, including big portfolios such as health and sport and transport and infrastructure. Can you be clear about why that underspend exists and what informed the choices when it came to overspend and underspend?

I am sure that other consequentials are coming, there will be immediate requests for that money from various groups in the economy, and I am sure that that will be well spent.

I turn my attention to another two sets of important statistics. One is from the Scottish Fiscal Commission, which projects a shortfall of £190 million in tax revenue take for 2022-23, possibly rising to £417 million by 2026-27. We saw yesterday the report that came out from the Confederation of British Industry and KPMG, which had the productivity index.

Putting those together, we see that the tax take in Scotland is not as strong as we would like. That refers back to some of the comments that you made in answer to the convener’s questions. Let us also be frank that economic growth in Scotland is also not nearly good enough, and the productivity indices that were produced yesterday show some really worrying signs. I want you to give us an idea of what you think must happen to address some of the serious structural issues in the Scottish economy that are the reasons why we are behind not just other parts of the UK but most other regions.

[Inaudible.]—one of which follows on from that last question regarding personal security. Can I get some clarity on the timescale to which the SPCB will want feedback from members of the Scottish Parliament after they have sought advice from local police, which they were requested to do? When do you expect to get a good idea from members of the home security that they might require?

You are quite right to say that you cannot overspend: that is absolutely a legal requirement for the Government. Notwithstanding what you said in answer to my first question, there are choices to be made. When it comes to certain underspends, which were large in the health budget—you have explained about future requirements when it comes to vaccines and so on, which I absolutely understand—there are issues around infrastructure, transport and so on.

In a period when urgent economic assistance is required, people are quite rightly asking what has driven the choices when you hold some money back for the next set of financial payments. What drives those choices that you have to make? That is what I am trying to ask you: what do you absolutely prioritise when it comes to the underspend money?

That will be very helpful, because there are members who want a bit more guidance. The SPCB has done a very good job on the issue, and it was a very sensible recommendation for us to contact local police and so on for home visits. Lots of members would like to be able to feed back on those contacts and ensure that the SPCB can help them with some of the costs, hopefully in the not too distance future.

All three panellists have highlighted considerable extra expenses that the Parliament is having to cope with, including staff costs, security costs and on-going inflation. There are also some savings, as I can see from the numbers. What processes are there for the SPCB to estimate the changes in savings that will come about because of our changed working practices? For example, members’ travel expenses over the period of Covid were less than what they had been before, because we worked at home, as did our staff. What processes are there for the SPCB to project whether the change to working practices will be permanent, and to project what savings will accrue from that if it does? How can that be worked out?

I asked the question because there are people around the country who might ask why there is an underspend on the Scottish budget during a pandemic when businesses face serious issues. I think you said last week that you had spent absolutely every penny that you had to hand, but another £100 million appeared for business. Do you understand public concern about that £580 million being there but not being spent at a time when people have really urgent concerns?