Meeting date: Thursday, November 2, 2017
Meeting of the Parliament 02 November 2017
Agenda: General Question Time, Point of Order, First Minister’s Question Time, Diabulimia, Inclusive Education, Decision Time
- General Question Time
- Point of Order
- First Minister’s Question Time
- Inclusive Education
- Decision Time
First Minister’s Question Time
Before I call Ruth Davidson to ask question 1, I inform members that I have been advised that Alex Rowley is unable to attend First Minister’s question time today. I will therefore call Jackie Baillie to ask questions on behalf of the Scottish Labour Party.
Today I welcome the publication of the Scottish Government’s paper on tax. We will take time to study it in detail and we are happy to engage on it, as the First Minister has requested. However, let me raise some initial questions. In the paper, the First Minister claims that the health of the economy will be front and centre of any tax changes that she makes. Will she grant the request that has been made by economists and trade bodies to conduct a full, independent and thorough economic assessment of any tax changes before they are undertaken? (S5F-01651)
We will consider any reasonable request that is made in the context of the discussions that we will have following the publication of today’s paper. However, it is of course incumbent on the Cabinet Secretary for Finance and the Constitution and the Government generally to put forward proposals that we consider to be in the best interests of the country as a whole.
In my view, the most important aspect of the paper that we have published today are the four key tests that should guide our decision making: we need to make sure that we protect the ability of this Parliament to fund our public services; we need to protect those on the lowest incomes; we need to make the tax system fair and tackle inequality; and, of course, we need to make sure that the interests of our economy are absolutely at the heart of all the decisions that we take.
One of the things that I said this morning, which I genuinely think that all of us in Parliament should try to embrace, is that often debates on tax are seen as the interests of the economy on the one hand versus the interests of public services on the other. That is the wrong way to look at it: our taxes pay for the infrastructure that our economy needs, the additional support for entrepreneurs that I announced just yesterday and the small business bonus, which removes from small businesses the burden of business rates. We need to look at this from the point of view of what kind of country we want to be, what kind of economy we want to have, and what kind of society we want.
My final point is this, and I say it in the spirit of an open discussion. I hope that the Conservatives will reflect on the fact that their policy, which has been analysed in this paper along with the policies from all last year’s party manifestos, would reduce public spending in Scotland by £140 million. Given that Ruth Davidson regularly asks me to increase public spending on a range of issues, that is something that the Tories have to seriously reflect upon.
There was a reason why I asked specifically about the economic assessment that economists and trade bodies want. That is because—perhaps it has not been properly understood—under the new deal agreed between the UK and Scottish Governments, if Scotland’s economy grows more quickly than the rest of the UK, the additional revenues will flow directly to Holyrood, whereas if Scotland’s economy grows more slowly, revenue will drop, so we all need to know whether a tax rise will slow down growth in Scotland compared with the rest of the UK. Job creators, retailers and industry figures have stated their belief that that will happen if taxes rise. How does the First Minister answer their concerns?
Their concerns will be answered in the round of the decisions that we take. As I have said very clearly, those decisions must have the interests of public services, the lowest earners in our society, and the economy at heart. It is coming to balanced, responsible and progressive decisions that is the objective of this Government.
Of course, as Ruth Davidson is also aware, the Scottish Fiscal Commission now has the statutory responsibility for providing the tax forecast that the Scottish budget will be based on. The office of the chief economist has carried out the analysis in today’s paper, but the analysis that will guide our budget is the analysis that is done by the Fiscal Commission, which will take into account a range of different factors.
I have two final points to make on this. First, on Ruth Davidson’s point about tax generally, one of the points that I made this morning—I see that the Reform Scotland think tank has made the same point—is that it would be better for all of us if Scotland had a wider range of tax powers at its disposal. To simply have income tax to look at is not an ideal position to be in. However, that is the position that we are in and therefore we have to take balanced, progressive decisions on that basis.
Finally, the competitiveness and the attractiveness of our economy are not just about our tax rates, important though they are. It is also about the quality of our public services; it is about the skills of our population; and it is about the infrastructure that we have as a country. Right now, Scotland has the highest quality public service provision anywhere in the UK; we have the most generous social contract anywhere in the UK; and, taking account of any of the potential options in the tax paper that we have published today, Scotland will remain the most cost-effective place to be in the UK.
That is a great position to be in, but because of Brexit and because of austerity—policies that have been imposed by Ruth Davidson’s party—we have to ask ourselves how to protect all that matters to us as a country and that is what will drive the decisions that this Government takes.
There is another principle that I would hope the Scottish Government would follow, which has not been mentioned so far, and that is simplicity.
The Fraser of Allander Institute has made it clear that there is a strong argument for keeping the tax system as straightforward and transparent as possible. As it points out,
“The more complex it becomes, the more inefficient it is.”
One of the proposals put forward this morning suggests as many as six tax bands. Will the First Minister take heed of warnings that a new, more complex tax system could create unintended consequences that detrimentally impact the amount of money raised?
There is an irony behind that question. It is commonly accepted that right now, the UK has the most complex tax system anywhere in the world. Of course, much of what lies behind that, even with income tax, remains outwith the power and responsibility of this Parliament. Let me look at the proposals that are in the paper for discussion to illustrate the options that are open to us. Some of them do propose a greater number of tax bands. One point that is commented on in the paper is that, by international standards, even the highest number that is proposed in the options, which is six tax bands, would not be unusual.
Another point made in the paper is that the more bands there are, the more progressive the tax system often is overall, because that allows tax to be more acutely aligned to the ability to pay. I know that progressive taxation and relating it to the ability to pay is not a principle that is particularly close to the hearts of the Conservatives, but it is a principle very close to the hearts of the Government.
I return to the central point. We have good-quality public services, albeit that they have challenges. We have a good social contract. We have good support for business and for infrastructure. However, we face further austerity from the Tories. We face the impact of Brexit. We face an ageing population. If we want to protect the society and the economy that we want to have, these discussions are vital. That is why the point that I posed to Ruth Davidson earlier is important. The Tories’ proposal, as analysed in the discussion paper, is to give a tax cut to the top 10 per cent of earners in the country, which would take £140 million out of the Scottish budget. Before they go any further in this tax debate, Ruth Davidson and the Conservatives have to explain how they would pay for that and who would bear the burden of that.
Despite the attempted distortions, the reason why we support a competitive tax regime is that we believe that it will develop Scotland’s economy, boosting the income tax that we need for our schools and hospitals. We do not think that it is right that every Scot earning more than £24,000 should have to pay more. The bottom line is about getting growth, and we are lagging behind. Scotland’s economy is currently growing at a third of the rate of the United Kingdom economy.
When we look to the Scottish Government this week, we discover a £500 million growth scheme, which was announced a year ago and is still to distribute a single penny; we see that it has failed to meet a pledge to set up a new strategic board to take forward its plans on enterprise and skills by the deadline that was set; and we have a First Minister who wants to start a debate about raising taxes. Does the First Minister not see that, first and foremost, we need to have a debate about boosting economic growth in Scotland to levels at least that of elsewhere in these islands?
I am not sure where Ruth Davidson has been in recent weeks, but Nora Senior, a very highly respected businesswoman in Scotland, has been appointed to chair the strategic board and is working hard to put it in place to ensure that we align the work of our enterprise and skills agencies.
It may have passed Ruth Davidson by, but one of the illustrative options in the paper would reduce tax for the very lowest-income earners in Scotland, making the system even more progressive.
We come back to this central point. I absolutely agree—and let us make this a point of consensus—that it is of central importance to support the growth of our economy. However, if we were to pursue, in the budget that we will set in a matter of weeks, Ruth Davidson’s proposal for a tax cut for the very richest and highest earners in our society, that would involve finding £140 million to take out of that budget before we did anything else. I say again to Ruth Davidson: that is an issue that she has to answer in this debate.
For our Government’s part, we will put forward our proposals to protect our public services, to protect our ability to invest in the economy and to ensure that we are doing everything that we possibly can to protect the most vulnerable in our society. Those are our priorities, and they will guide the development of and the decisions in our budget.
I welcome the discussion paper on tax and the focus on progressive taxation, but can the First Minister tell the Parliament how much she needs to raise to end austerity? (S5F-01652)
I encourage Labour to take part in the discussion in the spirit in which we are opening it. The analysis sets out very openly how much each of the proposals of the parties at the election last year would raise, and it sets out how much would be raised by the alternative proposals that we have put forward. That is a starting point for discussion.
We have to balance a budget. We have to take account of different things: we have to mitigate austerity and, as I have said before, we have to provide a fair pay increase for our public sector workers. Let us have that discussion, and let us try to come to a consensus that is in the best interests of everybody across our country.
I will help the First Minister with an answer, because she needs to know the scale of the challenge that she faces. To end austerity, she needs to raise more than £800 million in revenue over the next two years. That is before we consider additional commitments. However, the Government proposals that have been published today in the tax paper would raise a maximum of £290 million. That does not even come close to closing the gap. There is a black hole in the budget, so more services will end up being cut.
On top of that, after months of Labour pressure, the First Minister has promised public sector workers a pay rise, which is very welcome indeed. However, public sector workers have not had a pay rise since 2010—not a proper and decent pay rise. We need to be clear about this and we need a specific answer from the First Minister. Will she keep her promise and deliver a cost-of-living real-terms pay rise to public sector workers, and will it be fully funded by the Scottish Government?
Labour seems to be mired in confusion in this debate. Jackie Baillie has put a figure of £800 million before us today, but Labour’s proposals—or, at least, the latest Labour proposals, because there have been so many—would not come close to raising that amount. Unless Labour is saying that it is going to pile more pressure on to the lowest-paid income tax payers, it has questions to answer.
I have been very clear about public sector pay: we will set out our public sector pay policy and its detail when we publish our budget. That is what happens in the normal course of events. I want fair pay increases for our public sector workers. Of course the increases have to be affordable, which is one of the reasons why the debate on tax is so important. We have set out in our tax paper a range of options; there might be other options that parties want to propose. However, let us go into the discussion in a spirit of trying to find a consensus that is in the interests of our society, our public services and our economy. That is what I encourage all parties to do.
Let us not forget—those of us in the Scottish National Party part of the chamber, at least, will not forget—that the impact of Tory austerity goes further than anything that this Parliament can do to mitigate it, which is why we should keep up the pressure on the Conservatives and on the Chancellor of the Exchequer, as we approach his budget, to stop austerity and to end it at source, rather than have it passed on to the shoulders of the most vulnerable people in our society.
I will provide the First Minister with some detail. I refer to page 32 of her own tax document, where Labour’s proposals are costed at about £700 million in one year. I talked about £800 million over two years. I think that even she will agree that there is more than enough in Labour’s proposals to end austerity—something that she has so far refused to do.
For this Government promises are made to be broken. Her promise to parents and teachers to cut class sizes? Broken. Her promise to our young people to abolish student debt? Broken. And her promise to our elderly people to eradicate delayed discharge in our hospitals? Broken. She also made a promise to patients about a legal guarantee of treatment within 12 weeks. That, too, has been broken.
Now we have before us a tax plan that simply does not add up, and a list of commitments for which the First Minister knows she cannot pay. Who is the First Minister going to fail next?
On the basis of that performance, no wonder Labour is going through leaders, or people at the dispatch box, at such a rate. Maybe one of these days Labour will find someone who is capable of asking a decent question. [Interruption.] James Kelly is shouting at me, “What’s the answer?” What was the question that Jackie Baillie asked me? [Laughter.] If anybody can work it out, they are doing a lot better than I am.
Labour has just demonstrated that it is incapable of the kind of mature, serious and honest debate that our tax document opens the door to. I am not sure whether Jackie Baillie did this deliberately or just does not understand the figures in our paper, but when she was quoting figures about Labour policy, she deliberately excluded the behaviour change element. However, when she quoted the figures about SNP policy, she included that element. Labour can do it one way or the other, but it has to be consistent.
Let us get back to the central point at issue here. We have opened the door today to a serious, mature and grown-up discussion about how we fund our public services and our economy. Let us see if any of the other parties in the chamber are capable of such maturity. [Interruption.]
Will members please be a little quieter? They should listen to the question and then listen to the answer respectfully. I live in hope.
We will take some constituency questions now. The first is from Andy Wightman.
Centres of Excellence (Funding)
The First Minister will be aware of proposals by the City of Edinburgh Council to close one of Scotland’s national centres of excellence—the City of Edinburgh Music School. I declare a personal interest as my daughter is an alumna of the school.
Can the First Minister confirm that funding for Scotland’s national centres of excellence across the country continues to be provided by the Scottish Government? Does she agree that the City of Edinburgh Council does not have unfettered discretion to close the school? Importantly, will she consider how, in the near future, the financial arrangements that are in place to support all Scotland’s national centres of excellence can be restated and made clear, in order to ensure that staff, parents, pupils and future pupils have clarity and certainty about the future of those world-class facilities?
First, I agree that the national centres of excellence are world-class facilities. In answer to the specifics of Andy Wightman’s question, there is specific funding for the school, although it is now rolled up within the total local government settlement. We value highly the role of all six centres of excellence, including the City of Edinburgh Music School.
The Scottish Government has been engaging with the City of Edinburgh Council on the matter. Of course, the closure is only a proposal that the council is considering at this stage in its budget consultation, but the council will want to reflect on the fact that the centres of excellence, including the music school, allow children and young people across Scotland the opportunity to receive expert tuition in their specialisms—in this case, music. That is very valuable. There is plenty of evidence of that, and I am sure that its importance is something that the City of Edinburgh Council is reflecting on carefully.
Children’s Waiting Times (NHS Greater Glasgow and Clyde)
Molly is 18 months old. She suffers from reflux and will not eat solid food. While facing a 12-week wait to see a specialist, Molly’s parents were extremely concerned about the physical and psychological impact of the condition. Molly’s parents were then told by NHS Greater Glasgow and Clyde that her wait had increased to 21 weeks. The development and wellbeing of a baby is on the line. Will the First Minister agree to meet Molly’s parents and to look into the case urgently?
First, based on what I have heard from Maurice Golden, I say that I absolutely understand the anxiety of Molly’s parents. The situation will be of huge concern to them. The wellbeing and development of all babies is absolutely paramount.
I will certainly urgently look into the case and avail myself of the detail, and I will ask the Cabinet Secretary for Health and Sport to write to Maurice Golden and certainly, if necessary, to engage with Molly’s parents. I am sure that we all want to wish them and Molly the very best.
Gourock to Kilcreggan Ferry
Technical issues and staffing problems are severely disrupting the Gourock to Kilcreggan ferry service. The service is regularly off for weeks on end, and has been suspended again this week. The current situation is untenable and unacceptable. The Minister for Transport and the Islands has promised to get a grip on the situation, but local patience is wearing extremely thin. What assurance can the First Minister provide today that a solution is in sight and that users of the ferry will finally get the service that they deserve?
It is hugely important that people who rely on our ferry services have reliable services to use. That is the case on this route, as it is on all routes. We invest heavily in our ferry services, and many new routes are now available.
On the Gourock to Kilcreggan ferry and the issues that Jamie Greene raises, I will speak directly to the Minister for Transport and the Islands and ask him to reply to the member. It is vital, if problems are being experienced, that everything possible is done to rectify and resolve them.
I, too, welcome the very interesting discussion paper on income tax that the Government has published today.
Last year, in the election campaign, political parties put forward three basic ideas on tax. The first was no change, with or without a little tweaking of the thresholds, which would have benefited only the wealthiest. The second was an increase in the basic rate, which would have increased tax for low earners. The final one was the Green proposition, which showed that we can raise revenue for our public services while protecting low earners and reducing inequalities with a fairer range of rates and bands. Is it not clear now that the no-change option that the Scottish National Party put forward is off the table, that an increase in the basic rate is off the table, and that the Green option of a fairer range of rates and bands is the only serious option left standing? (S5F-01653)
I give Patrick Harvie 10 out of 10 for effort and for claiming credit for everything in the paper.
In point of fact, the SNP’s manifesto proposal last year was not for no change, and that is borne out in the paper, in terms of the revenue forecast for that. Patrick Harvie is right to say, however, that we were not in agreement with proposals that would increase tax for the lowest earners, and I still do not favour such proposals.
I recognise in the programme for government that, given the pressures that we face and our desire and determination to protect what really matters to people across Scotland, we must have an open and honest discussion about whether those on the highest incomes should pay a modest amount more, to try to enable us to protect services. We look forward to engaging in those discussions, which I hope that all parties will engage in constructively.
I come to the other point, and, to be fair to him, Patrick Harvie has made this point previously. I am frequently told in this chamber that we are a minority Administration. If all parties simply stick to their manifesto positions we will not pass a budget, and if this Parliament does not pass a budget, it fails in its duty to the Scottish people. We have an opportunity not to stick doggedly to previous positions but to come into a discussion with the best interests of the country at heart. If we all do that, we will pass a budget; more important, we will pass the right budget.
My first question was not meant as a criticism. I congratulate the First Minister on seeing the strength in what the Greens have been advocating for the past couple of years.
It is very clear that the only way that the Scottish Government can pass a budget this year is by raising enough revenue for public priorities such as an inflation-based increase in public sector pay, but to do that fairly, in a way that reduces inequality. Is it not also clear that if we do that, there must then be an equally open and creative discussion about the other side of the tax picture, which is local tax? The SNP has stalled on local tax reform for far too long. It is overdue and the project must be put back on the agenda.
Last year, we made reforms to the local taxation system. Those reforms are right now providing additional revenue that is helping to support public services across the country.
I know Patrick Harvie’s position on wider reforms to local tax, and no doubt that is a discussion that we will all continue to have in the years to come. However, this Parliament has a job ahead of it over the next few weeks, and that is to come to a position on tax and pass a budget that protects our public services and protects investment in our economy. The document that we published today gives us a really good foundation on which to try to do that.
This will not just be a test of the Government’s ability to be open, honest, realistic and mature in our approach but a test of every party in this Parliament. Let us see whether all of us collectively can live up to that test. The next few weeks will answer that question for us.
British Transport Police (Merger)
Papers released this week by the joint programme board that is overseeing the British Transport Police merger show that work is still required to assess the merger’s cost. Does the First Minister agree that progressing the merger of the BTP and Police Scotland without doing a full cost analysis in the first instance demonstrates a shocking lack of financial prudence on the part of the Scottish Government? What comments does the First Minister have on the petition against the merger that was handed in this week and which has more than 11,500 signatures?
No, I do not agree with Mary Fee. The merger of the British Transport Police, which has now been devolved to the Scottish Government—something that Labour supported in the context of the Smith commission—is being taken forward for three main reasons: to improve accountability; to ensure that the transport police have access to Police Scotland’s wider range of resources; and to future proof the transport police’s future governance. As we know, the Conservatives’ manifesto for the last United Kingdom election said that they were going to create a bigger infrastructure police force and absorb the British Transport Police into it. As a result, if we do not take actions here, we risk leaving the British Transport Police isolated within that governance structure.
We will take forward the proposals sensibly and responsibly. Indeed, the joint programme board is there precisely to do the detailed work to ensure that this is a success, and we will continue to work with those employed in the British Transport Police to ensure that we take account of all their concerns as we go forward.
Fifty years ago today, the people of Hamilton and Blantyre elected Winnie Ewing to Parliament. In many ways, 2 November 1967 was the start of modern Scottish politics, in which this nation aspires to being outward looking, gender balanced and European. Does the First Minister agree that now, as in 1967, the message that should ring out is, “Stop the world—Scotland wants to get on”?
Briefly, First Minister.
Of course, it was on this day in 1967 that Winnie Ewing won the Hamilton by-election. I do not think that it is an exaggeration to say that that by-election changed the course of Scottish political history. Winnie Ewing has been a trailblazer in so many ways: as a champion of Scottish independence; as a woman in a man’s world; and as the person who famously reconvened this Parliament in 1999. Winnie Ewing is, quite simply, a legend in her own lifetime. Winnie, if you are watching, we send you our love and we thank you. [Applause.]
Deaths in Custody (Inquiry)
This week, the United Kingdom Government published both the report of the independent inquiry chaired by Dame Elish Angiolini into deaths in custody and its response to that report. I have previously called for an inquiry into deaths in custody in Scotland, because I strongly believe that improvements could be made in the interests of families and the police, particularly following the death of Sheku Bayoh while in police custody in Fife. Will the First Minister today commit to holding an inquiry? What is her response to Dame Elish’s report and the relevance of its recommendations to Scotland?
The Government—and, I am sure, the Crown Office—will, of course, carefully consider Dame Elish Angiolini’s report. It is important to remind members that custody arrangements in Scotland are distinct from those in England and Wales. Under the Inquiries into Fatal Accidents and Sudden Deaths etc (Scotland) Act 2016, a fatal accident inquiry must be held into any death in police custody, unless the Lord Advocate is satisfied that the circumstances have already been clearly established in other proceedings. However, we recognise that improvements could be made, so we will study the report carefully and determine whether there are any actions that the Scottish Government can take. The Crown Office, too, will decide whether there are any actions that it is required to take.
Although I understand members’ concerns about the circumstances surrounding Sheku Bayoh’s death, the member will appreciate that I am not able to comment more directly on that right now as the matter is still under consideration by the Crown Office. However, these are important issues that the Government will pay serious attention to.
Online Medical Information
To ask the First Minister, in light of reports that Macmillan Cancer Support is acting to combat so-called fake news regarding health conditions, what action the Scottish Government is taking to ensure that people are not misled by fake medical information online. (S5F-01674)
This is an important question. I think that Macmillan’s appointment of a digital nurse is really welcome and will be a very useful resource for patients. Accessible, robust and accurate medical information is vital, which is why NHS 24 has produced the nhsinform.scot website. NHS inform follows strict on-going clinical quality assurance processes in partnership with a range of organisations, including Macmillan Cancer Support, to verify the accuracy and quality of content, and I urge anyone who wants to go online to look into any medical condition to use nhsinform.scot, because they can be assured of getting reliable and accurate information there.
As the services on NHS inform, such as information on treatments and test and guidance on finding the right local services, can be of use to many people across Scotland, can the First Minister outline what steps have been taken to promote the website to make it better used in Scotland?
NHS inform provides a range of information, not only on procedures but on healthy living, on various illnesses and conditions and on health rights, among other subjects.
In April this year, NHS 24 launched a publicity campaign, including social media activity and advertisements on buses and trains, that has significantly raised awareness of NHS inform. The number of visits to the website has almost quadrupled since the launch of that campaign, going from 116,000 visits in April 2017 to 463,000 visits in September. The NHS will continue to take steps to make people aware of the service and, as MSPs, all of us have a role to play in ensuring that our constituents are aware of it, too.
Macmillan Cancer Support is also greatly concerned about cancer waiting times. It points to the fact that NHS Lanarkshire seems to be the only health board that is achieving its targets in this area. That is due in part to the fact that NHS Lanarkshire published not only details of its delays but the reasons for those delays and the steps that it is taking to mitigate them. Does the First Minister agree that it is now time to roll out that practice across all of our health boards, so that we can reduce cancer waiting times in the same way that NHS Lanarkshire has done?
That question is a little wide, but I call the First Minister.
The Cabinet Secretary for Health and Sport is already chairing a group to consider what more needs to be done to further reduce cancer waiting times. One of the key objectives of that group is to consider the learning from NHS Lanarkshire, which is to be applauded for the work that it has done, and to see how that can better be rolled out across the Scotland. I will ask the health secretary to keep the member up to date as that work progresses.
Pupil Equity Funding (Outcomes)
To ask the First Minister what criteria will be used to assess the outcomes of pupil equity funding. (S5F-01657)
Nationally, we are currently consulting on the criteria that will be used to measure progress towards closing the attainment gap, and we will confirm our approach in the 2018 national improvement plan, which was published in December. Locally, we expect schools and authorities to make use of the data that they already have and to incorporate details of the pupil equity funding in existing planning and reporting processes, including in their annual school improvement plans and standards and quality reports. School inspection and other review processes will also be used where necessary to ensure that schools are using their funding properly.
The First Minister will be aware of the recent reports that indicate that the pupil equity fund is being used in some councils to plug gaps in other areas of local education budgets, for example in relation to janitors’ overtime. Does the First Minister agree that some of those decisions do not have the necessary focus on literacy and numeracy that the Scottish Government has stated? To help restore that focus, will the First Minister agree to reverse the Government’s decision to remove Scotland from well-respected international measurements on literacy and numeracy?
Given the discussion that we regularly have in the Parliament about the programme for international student assessment—PISA—results, I think that there is a fair amount of international scrutiny on the performance of the Scottish education system. Part of the purpose of the national improvement framework is to ensure that we have much more rigorous and detailed information in Scotland on the performance of our schools and the education system more generally.
The pupil equity fund is there to provide additionality in our schools, particularly targeted at closing the attainment gap. Liz Smith will be aware that claims that Glasgow City Council, for example, plans to use PEF money to part-fund the settlement of the janitors’ pay dispute are simply wrong—they are factually inaccurate. That settlement is funded without a single penny of PEF money being used.
Obviously, it is for headteachers to determine how they use that money, but the money should be for new services, in line with the criteria for the PEF, that are about improving standards in our schools and closing the attainment gap. The work that I spoke about in my initial answer will help us to monitor that as the pupil equity fund scheme continues.
The pupil equity fund is indeed a good thing, but that money must be additional. It is just a matter of common sense that there will be pressure to use the fund to plug gaps in core funding as long as core council and school budgets are being cut year on year alongside PEF being made available. Therefore, will the First Minister promise to end those cuts to councils and schools in the budget, so that the equity fund can indeed do the job that it is designed to do?
I am glad to hear Iain Gray say that the pupil equity fund is a good thing. He might want to try to explain why Labour voted against it in the budget if he thinks that it is such a good thing. [Interruption.]
It is amazing how Labour members do not like having basic facts pointed out to them. They get very uncomfortable.
To go back to the serious issue at hand, local budgets and the spending power of councils—which we heard the finance secretary talk about before First Minister’s questions—increased in this financial year. How we continue to protect local services is part of the discussion that we have opened today on tax.
My third and final point is that councils had the opportunity to increase their council tax by up to 3 per cent in this financial year. Strangely, the only councils across Scotland that did not use that power were Labour councils. Labour members come here asking for more money from the Scottish Government while their own councils will not exercise the powers that they have to increase the funding available.
Interest Rates (Financial Hardship)
To ask the First Minister what action the Scottish Government plans to take to help families faced with financial hardship should interest rates rise. (S5F-01671)
In November 2014, we launched Scotland’s financial health service. That is a one-stop web-based service that provides impartial information for anyone who has concern about debt, borrowing, managing money or general financial concerns. The service can signpost people to the most appropriate area of support, and they can find the help that they need in one place.
In addition, we are committed to establishing a financial health check guarantee that provides advice on how people can maximise their income and access the best deals on utility and financial products, and we also support families in need through the Scottish welfare fund.
Ten years of wage stagnation, low wages and the rising cost of living mean that more households could be tipped over the edge into serious financial difficulty, should there be even a small rise in interest rates today. I wonder whether the First Minister shares my concern.
A third of Scots are worried about the amount of money that they owe, and many are turning to credit to pay for essentials including gas, electricity and other basic things. The Office for Budget Responsibility—this is a very serious point, Presiding Officer—has said that household debt could in four years be as high as 47 per cent. I realise that it is difficult to respond to a question of that magnitude, but in view of the First Minister’s previous answer and the importance of affordable credit, is it time for the Government to invest more seriously in affordable credit and to promote credit unions more seriously? They have a crucial role to play in increasing financial inclusion.
One area that is worth looking at—[Interruption.]
Your question, Ms McNeill, please
I am genuinely surprised by the reaction to the question. [Interruption.]
Ask a question, please, Ms McNeill.
Will the First Minister consider not-for-profit lending schemes such as Conduit Scotland in Fife, because there is a significant and serious role that credit unions and such schemes can play—
A question, please, Ms McNeill.
Let us not forget the many Scots who will face financial hardship. Would the First Minister be prepared to take a personal interest in taking that forward?
There is a big area of consensus here. I agree with the thrust of Pauline McNeill’s question. I am a massive supporter of the credit union movement; it does fantastic work and this Government has supported it and will continue to do so. We will look at what more we can do for it.
I understand that the Bank of England has just announced the first rise in interest rates since, I think, July 2007—a 0.25 per cent increase—which I know will be of concern to families across the country. We will continue to look at how we support people who are on the lowest incomes.
I go back to one of the central issues that we have been discussing at First Minister’s Questions today—it is one of the genuine points of disagreement between the SNP and Labour in our approach to income tax. We do not think that we should, for many of the reasons that Pauline McNeill has talked about, increase income tax for the lowest-income families. Such issues have to be at the heart of all the decisions that we take; they will continue to there, from the perspective of this Government.
Scottish Welfare Fund
To ask the First Minister how many households have received support from the Scottish welfare fund. (S5F-01670)
Since the creation of the Scottish welfare fund in April 2013, more than 265,000 households in Scotland have received grants totalling £140 million. One third of those households are families with children.
It is not acceptable that such support, which covers the basic costs of living including the costs of food and heating, is needed by so many people, but we know the impact that the United Kingdom Government’s harsh welfare cuts are having on people. We have repeatedly warned that the chaotic roll-out of universal credit—particularly the six-week delay for the first payment—is pushing more households into crisis.
We will continue to do all that we can to support hard-pressed families, and we remain absolutely committed to a welfare system that treats people with respect and dignity.
Is the First Minister aware that a report that was published this week warns that disabled people and their families are being left hungry, cold and homeless by Tory welfare cuts, with some people being driven to thoughts of suicide? Given that 30,000 people in Scotland could lose out once the UK Government’s personal independence payment roll-out is complete, does the First Minister foresee demand for the Scottish welfare fund growing more, as the Tory obsession with austerity continues?
Yes, I do. I was very concerned—as many people will have been—to read the findings of the report, which also highlights that 44 per cent of disabled people could see their disability benefits being reduced or completely removed. That is an example of the continued onslaught of welfare cuts from the Tory Government hitting the most vulnerable people in our society, which is putting immense financial and, at times, emotional pressure on them.
When there is still a lot of month left at the end of the money, people need somewhere to turn. Therefore, although I wish that it was not necessary, I am glad that we provide the safety net of the Scottish welfare fund. However, people need more than just that: they need the UK Government to pay attention to the catalogue of evidence of the damage that it is causing to the most vulnerable people, and to act now to reverse the cuts.