Chamber and committees

All the submissions that the committee has received express concern about the VAT baseline, which is included in the figures in table 2 of the financial memorandum. To be fair, time has trundled on, and that was published before the latest skyrocketing levels of inflation. However, in its response, COSLA states:

“These figures are misleadingly uprated each year, from a 2019/20 baseline, by inflation plus 3%. This uprating does not reflect subsequent Local Government settlements”.

That is important, given that it was announced way back in May. The response goes on to say that the uprating

“is completely at odds with the reality presented by the Scottish Government’s own Resource Spending Review, of a 'flat cash' settlement”.

Surely that alone means that the financial memorandum is no longer fit for purpose and requires to be updated at least.

The last question from me—and the last in this session—is: does the financial memorandum, in your view, deliver best estimates of the cost of delivering the legislation?

Good morning, and welcome to the 26th meeting in 2022 of the Finance and Public Administration Committee. We are joined in the public gallery by members of the California Lawyers Association. I welcome them all to the Scottish Parliament.

We have received apologies from Ross Greer and Daniel Johnson.

The first item on our agenda is an evidence session with Scottish Government officials on the financial memorandum to the National Care Service (Scotland) Bill. I welcome Donna Bell, director of social care and national care service development, and Fiona Bennett, interim deputy director for national health service, integration and social care finance.

I understand that Donna Bell would like to make a short opening statement.

Could you speak up a wee bit? I am finding it difficult to hear you, and I think that other members are, too.

Thank you very much for that opening statement. Given the submissions that we have received, you will understand that it is likely that there will be a number of questions from me and from colleagues around the table.

In its submission, the Convention of Scottish Local Authorities mentions

“the long-term resourcing of the National Care Service; matters in relation to borrowing, holding of reserves, pensions, audit and VAT; and shared services”,

and it says:

“Disappointingly, the draft Bill and memoranda do not address these points explicitly and there is an unacceptable lack of clarity.”

Another issue came to the fore in all the submissions. We asked whether there was sufficient time to contribute to the consultation, and every respondent gave a one-word answer: no. We asked them to elaborate on that, and they said that the consultation took place over the summer and the period was far too short, given the magnitude of the bill and the depth of the financial memorandum, which is one of the most detailed—if not the most detailed—financial memorandum that I have ever seen.

How do you respond to those concerns and the other issues that I have raised?

Paul Manning, you said:

“Whilst the Financial Memorandum acknowledges that further work is required, this should have been undertaken prior to the publication of the Bill, to support adequate scrutiny.”

I realise that. A number of caveats are given right at the start of the financial memorandum, where that point is made, and the Scottish Parliament information centre repeated that in its briefing, so we are aware of that. At the same time, a structure is being developed that seems to have unrealistic parameters, and that is of concern to all of us.

Basically, you are saying that, ultimately, local authorities might have to find money from somewhere else.

On pensions, there is a real concern about viability, given that it is not known whether the national care service would be admitted as a member of the local government pension scheme, which is fully funded. Can you advise us of anything in that regard?

I have one final question. One positive aspect of the bill is the right to breaks from caring, but that has cost and staffing implications. CIPFA has said that

“There should ... be a role for professional assessment of need, as we see currently in social care and in the NHS”,

and that

“this will require financial investment in the professional workforce but is dependent on the workforce being available.”

To me, that seems more of an issue. We know that there is a chronic shortage of people working in care settings, with a figure of 300,000 across the United Kingdom. How deliverable will the measure be, given the staff issues? Will we be able to do it, given the workforce challenges?