Chamber and committees

Yes. If you are saying that we should set up a whole system in Social Security Scotland to pay winter fuel payment for one year, because we could not pay it for another year because we would not have the money, we would essentially just be sending the problem down the road. Spending tens of millions of pounds on setting up a system in Social Security Scotland to pay one year of winter fuel payments on a universal basis, without having any certainty or awareness of where the money will come from, and having to pay that block grant adjustment back in future years, strikes me as being very imprudent and not something that I, as the finance secretary, could possibly agree to do.

First, that would involve staffing up a section of Social Security Scotland without any certainty of being able to continue that, and there would be no means of knowing where the funding was coming from in future years. That would be worst of all—

We were in preparation for doing that. Social Security Scotland was recruiting staff. Money had already been spent and it was about to staff up. All the programmes were being worked on, ready for delivery this winter. All that was happening, and when the announcement was made—there was no consultation—we had to stop that work dead in its tracks. The work was going on at pace, and the benefit would have been delivered this winter, but it had to be stopped—

We can get that information for you—we can find out. I think that that has already been discussed, but we can get the costs from Social Security Scotland.

It was not our fault; there was nothing that we could do. We were proceeding in good faith on the basis of what we thought was going to happen, but—

It would essentially be about which year the impact of the £160 million lands in. We would just be deferring the removal of that for a year. The money is coming out of the system one way or another, and part of our discussion with the Treasury is about whether there is any discretion about which year it comes out of.

Jennie Barugh may want to come in on that.

It will be part of the budget. Whether that issue is reconciled this year or next, it supports the budget.

The balance between taxation and spending it is important; they are two sides of the equation.

Tax explicitly supports the lower paid, which we think is a good thing. Spending provides support, through the social contract, that is not available anywhere else. That might be free tuition or any of the other supports that are in place, such as the Scottish child payment, which is an anti-poverty measure and could be regarded as a public good or a public investment to help the next generation out of poverty, therefore helping society.

All those social provisions are an important part of the kind of society that we are trying to create here. We wonder why people come to live in Scotland. For some, that might be to take up the job of a lifetime; some might come because of lower house prices; some will come because of relatively low council tax or because of free tuition and attractive social provision. People base life-changing decisions on a range of factors. When we look at it in the round, the things that are available only in Scotland are attractive to many people.

There is a point to make about that. The evidence shows that valuations have benefited those who are in the higher bands. There is also a lot of evidence to show that people on lower incomes pay a higher proportion of their income in council tax than those on higher incomes.

One reason why we looked at the multiplier issue was to try to address some of that, but that became highly politically contentious, so we decided not to pursue that then. When we look at what to do in future, we know that we have to take people with us. We saw what happened in Wales, where a big-bang revaluation caused challenges and difficulties.

There are always winners and losers. We want to try to construct a way of doing it that has public buy-in, is gradual—not a cliff edge or a big bang—and is reasonable and fair. It is going to take many years to achieve that if it is done slowly. However, it will avoid some of the contentiousness and difficulty that emerged in Wales. I hope that, if it is done over the long term, perhaps at the point of house sale for example, there will be some political consensus about it. Every financial commentator and institution has said that continuing for another 30 years with no change at all is not sustainable. Given that we are all sensible, I am sure that we all want to land on a sensible way of proceeding.

The national performance framework is an important part of the budget process. It allows us to look at our performance on key delivery areas and see where things are going well.

The areas are rated red, amber, green, and we have a monthly session—if I am remembering rightly—during which we dive into areas of the national performance framework, particularly those areas that are have a red or amber rating. The read across to the budget is that we can consider what that tells us about delivery in that area and whether it is a funding issue. It is not always a funding issue. Some of it might be related to delivery, which is not necessarily tied to funding. We try to work through that and accelerate delivery in those areas. However, the budget is also an important point to assess the RAG rating around NPF and any adjustments that we need to make.

It will have an impact. However, so will the priorities that are set out clearly in programme for government. Not everything can be a priority. The programme for government is an attempt to lift out the key things that, among everything else, have to come first. Those key strategic objectives are the guiding point for what receives priority in the budget hierarchy.

When you look at prioritisation and deprioritisation, as inevitably you have to do with budgets, those will be your guides. You would expect the national performance framework to be very closely aligned with the programme for government objectives, because if it was not, that would be a bit of an issue.

We will continue to look at this very much on a case-by-case basis. We would not use such a blunt tool, not least because many mitigations help people remain in their homes. As far as mitigating the bedroom tax is concerned, the fact is that people are able to stay in their homes only because of the discretionary housing payments that are being made through local authorities.

Your point, though, raises a very important issue. If the bedroom tax were to be scrapped at source, it would immediately benefit the Scottish budget, because we would be able to deploy that £133 million with which we support not just discretionary housing payments but indeed, the Scottish welfare fund, which mitigates many aspects of the UK welfare system. The more that these matters can be addressed at source, the more that we will be able to utilise those resources for other important pressing issues.

That said, I would not want to leave anyone in any doubt, so I confirm that we will certainly not be removing discretionary housing payments. However, the point that we raise with the UK Government at every opportunity is that it needs to take a look at all those things.