Chamber and committees

Indeed, the revenue has declined as was forecast, and it will continue to decline as per the policy intent and objectives. As I said in my opening statement, the rationale for the rate being consistent with that of the UK and Wales is to avoid the risk of waste tourism from emerging. That rationale underpins the approach that we have taken with the tax.

Robert, do you have any information that you are able to share on that point?

I think that, in the guide that we have provided to the committee, we refer to the additional flexibility around the reserve being welcome. I appreciate that we are right now operating in a challenging environment for public finances, but we highlight that that greater flexibility will be of considerable value in future years. For example, over the medium to longer term there will be an increase in our scope to borrow. Of course, we have to borrow sustainably in respect of capital, but the flexibility will increase our scope to borrow, over time.

You touched on it yourself when you mentioned capital spend; it is always about where we are with existing commitments and what requirements have to be met, and I know that that has been of some interest with regard to the capital allocations in the 2024-25 budget. As far as the net zero portfolio is concerned, either it has not been possible to deliver certain projects or changes to the profile of projects mean that they will fall in another financial year. There can be that kind of movement, given that the horizons over which capital projects are developed and actioned can go across multiple financial years. A number of different factors are reflected.

Moreover—and more broadly across the budget, including in resource—there can on occasion be demand-led schemes where the demand has not been what was anticipated or forecast. We have particularly sought to identify as early as possible where that sort of thing might emerge, so that we can reallocate the resource in an effective way. In certain areas—net zero, for example—it has not been possible to deploy the resource in-year, and as part of that in-year management, the capital has been reallocated.

Clearly, broader behaviour with regard to complying with environmental regulations goes beyond tax policy. Ministerial colleagues lead on those areas, and I would not want to speak about an area in which I do not have a direct policy lead.

The role that tax plays has been recognised. Important points have been raised. I want to have an opportunity to take those points away and come back to the committee to speak to how those factor into the considerations on rates.

As I have set out, the broad underpinning principle—the rationale—for the measure has been consistency with the rest of the UK. Correct me if I am wrong, but I think that the questions that the committee is asking are: has consideration been given to changing the rate to incentivise other behaviours, and how would that be balanced against any potential risk of waste tourism? Would that be a fair summation?

The question was about what the £235 million represents as a share of the overall capital allocation towards health.

As I said, I am happy to take that away. As I mentioned in my opening statement, we have a long-standing position on landfill tax, which is consistent with that of the other Administrations in the UK. Our policy objective is to ban biodegradable municipal waste going to landfill at the end of 2025. We are seeing the forecasted reductions in revenue; the direction of travel is consistent with meeting that ambition.

As Scott Mackay touched on—and if memory serves me correct, he has referenced this in the guide that we provided to the committee—in the scenario where, through the way in which the UK cycle of fiscal events operates, supplementary estimates are only being confirmed at the end of February, scenarios and situations can arise where we receive funding that has not been anticipated, so we have to manage that funding now. We still have to complete this financial year but any funding that is not allocated and spent within this year would be carried forward to support the position in 2024-25. Broadly speaking, we have consistently been able to ensure that any discretionary funding that we receive is spent in-year, and if it is not spent in-year it is carried forward. We have not lost any discretionary spend as a consequence of late consequentials. That speaks to the important role that the Scotland reserve plays in allowing that flexibility.

I think that the environment that we are operating in right now is reflective of the sustained inflation that we have seen, which we touched on earlier. Inflation would probably be regarded as quite high had it not been for the context that we have just emerged from. We set out earlier the reasoning and the rationale as well as the broader capacity challenges in the construction sector. It is reflective of a number of different factors.

We have set out the position for 2024-25 but, as we are reflecting on today, the final budget for 2024-25 will be determined by decisions that the UK Government takes. I made reference to the fiscal event tomorrow—I do not know what will be in that—then there will be the process of main estimates and supplementary estimates, and, of course, a general election is anticipated this year. Therefore, a number of factors can impact on the Scottish budget position during a year.

Our position is set out in the budget document. Any changes that materialise during the year as a result of UK Government fiscal events will, of course, be reflected in the normal way through the budget revision process.