Chamber and committees

There is nothing different this year.

On that point, I note that the education secretary will, no doubt, be asked questions in Parliament about the number of teachers—

It was spring of last year when the final agreement with the Scottish Funding Council was reached. There is nothing different at all this year with regard to those discussions with the Scottish Funding Council: it was spring last year and it will be spring this year.

We look to make sure that, when the SFC is giving us the advice and doing the analysis, any impact that our tax decisions may or may not have is built into the SFC’s assumptions. The SFC has described the change as “not economy moving” over its five-year forecast horizon.

I mentioned HMRC, which is helping us to develop the evidence base on priority areas of research interest, such as behavioural change, which includes things such as cross-border mobility. We will publish further information on that later in the year. That will be important, because HMRC is able to drill down more due to the information that is available to it. If other evaluation comes from independent analysis and from independent bodies that comment on this area, we always look at that as well. We draw from a range of sources. The SFC is fundamental, however, because it can analyse what we intend to do and whether, in its view, our proposal would have an impact on things such as behavioural change.

That evidence is being compiled. The SFC will do an analysis of what it believes the impact to be, and we will track it through real-time data from HMRC and look at the trends to see whether there is, in fact, any impact. That is the point that I am trying to make. HMRC is very important in all this, because it has the data on whether there is behavioural change and it will be able to disaggregate that in relation to the various bands of taxpayers.

We meet business leaders and representatives of the business community regularly. We talk about the impact on them of not just our income tax policy but a range of policies, including areas of UK Government tax policy, and they express a range of views. Do businesses want to pay more tax? Probably not, in the main, but that is the position with VAT, as well. Businesses are saying that they want changes to the VAT regime for the same reason.

With the levers that are at our disposal, taking NDR as an example, we had a very difficult decision to make around whether to put that resource into business tax cuts. The retail, hospitality and leisure sectors would, of course, have wanted us to make that choice, but I think that they also understand—certainly, the representatives of the hospitality sector that I met understood—that we had made a decision to invest that in public services. You cannot invest it twice, so they might not have agreed with the decision, but I think they understood why we had made it.

I am certainly happy to consider that. Again, the question comes back to timing. Should we hold such a debate before we know what the full picture will be following the spring budget on 6 March, or should we wait until we have the full picture? That is a judgment to be made, but I am certainly open to thinking about that.

It is important that we have an honest debate on the matter, because questions will undoubtedly be asked in Parliament about the implications for various projects. That is understandable, but the truth of the matter is that £1.6 billion cannot be removed from capital investment without its having an impact. If that is not reversed, there will be an impact—the question is where it will fall.

Forgive me—I had not realised that you were talking about the public health supplement, so let me address that issue directly.

The commitment is to look at and explore the potential of introducing a public health supplement, which is something that was obviously introduced previously. As part of that process, we have had some early engagement with the very business organisations that have been talked about and have said directly to them that we want to look at any evidence of impact that they can provide. We are engaging with them; I have met them directly, as have other ministers, and we will continue to have that dialogue with them. Clearly, other organisations, not least public health organisations, will have a different view, and we will look at all that in the round before making any decisions on the 2025-26 budget position. That early engagement was one of the commitments that was made in the new deal, and it is now under way.

Of course, any gap in the public finances is due in large part to decisions made by the UK Government with regard to our financial position, and that could be addressed in the spring budget on 6 March if the UK Government so wished.

The measure is, I think, important, with its focus on public health and, specifically, on raising additional revenues to support our approach to tackling public health challenges, but I stress that no decisions have been made on definitely taking it forward. What we are doing is consulting at an early stage on what the evidence is telling us and asking the business community itself to provide some of that evidence. That engagement will continue.

I do not know whether I have that figure to hand, but from my days as health secretary I remember that it is very significant. When I announced the minimum unit pricing regulations a few weeks ago, I provided a couple of figures about the impact. I cannot remember them off the top of my head, but we can certainly get that for the committee, if it would be helpful. The impact is significant.

We know that Scotland’s relationship with alcohol goes deep and is very challenging. There is not just a health impact; there is an economic impact from lost days at work and so on. It is considerable.