Chamber and committees

You have mentioned in your presentation some of the excellent work that countries such as Belgium, Sweden, Germany and Costa Rica have done. Should the Scottish Government and the UK Government look in detail at what is happening in those countries and try to implement some of those measures here, rather than reinvent the wheel and come up with something new that might or might not work? Adapting successful measures from elsewhere could save a lot of time and effort, if that can be done.

Human scientific ingenuity should not be ruled out. In my constituency, DSM, which employs around 350 people, has developed a feed additive called Bovaer, which will reduce the amount of methane emissions from cattle by between 30 and 90 per cent, depending on what type of cattle they are—dairy or beef—and on what their feed is. That would cost much less than retrofitting huge numbers of houses, for example, and it could have a significant impact on the environment. That example shows that there are a number of other areas that we could consider.

An investment of £100 million-plus will be made in that factory. The food additive will be marketed worldwide, and it has already had regulatory approval in the European Union. You spoke about changing some of the subsidies for agriculture. We could perhaps incentivise farmers to use that safe food additive to reduce methane, rather than progress some of the more complex methods that are currently being considered.

That advert for DSM is now over. I will open up to questions from around the table.

Australia has had road pricing for 20 years. You have an electric chip in your car, you drive along a motorway and you do not have to stop at any tollbooths or anything. You drive along, and you pass these things every 5km or whatever it happens to be. It is almost like being in a taxi—the meter keeps ticking over. If Australia has been doing that for 20 years, there is no reason why it cannot be done here, although, as you said, it will not be very popular. It would probably have to be met with reductions in other motor-related tax. One of the things about road tax is that it is not all spent on the roads—it just goes into general taxation.

Well, they will not happen without significant fiscal measures, so I think that it is an important fiscal issue for us. If farmers are not incentivised, they will just not do it; it is as simple as that.

Thank you for your evidence. We appreciate your giving us your time this morning, and thank you for your excellent report and for answering our questions. Your report will inform the committee’s approach to examining the finances of our net zero ambitions and areas beyond that, and we will consider the issues again at a future meeting.

We will now move into private session.

That was excellent—it was fascinating stuff, so thank you very much. It has stimulated our thinking on the subject and has probably generated quite a lot of questions from committee members.

I will open with some questions and then we will go around the table. In your last slide, under the “Fiscal Measures” heading, you talk about carbon pricing mechanisms matching a UK solution. You also mention devolved taxes and subsidies under that heading. It is really important that we take people with us on this journey, and I think that one of the most difficult things, as you list under your second heading, “Principles”, will be ensuring that what is done is proportionate.

You spoke about behaviour change and about good will from the public, which is what we need to be able to change behaviour. It is about how we marry those together. You said that, for landfill taxes, everything was set out over a number of years so that people could see the road to be travelled. Should the Scottish Government try to do that, so that we have a 10-year programme involving all the issues that you have mentioned, including how we reach various milestones along the way, where we think changes should be made, at what time they should be made, and by whom?

You talked about reprioritisation and removal of existing expenditure. Are there any areas where you think that that should be prioritised?

I will now suspend the meeting briefly to allow for a changeover of officials.

I thank colleagues around the table for their questions, and I thank the minister for his evidence.

Item 3 is formal consideration of the motion on the Scottish statutory instrument. I invite the minister to move motion S6M-03069.

Motion moved,

That the Finance and Public Administration Committee recommends that the Budget (Scotland) Act 2021 Amendment Regulations 2022 be approved.—[Tom Arthur]

Motion agreed to.

I knew it—okay, right.

I get what you are saying, Professor Heald, but there is another difficulty in addition to the political difficulties of putting money away at a time when there is huge pressure on budgets, as there is at the moment. In previous decades, we saw a tendency in UK Governments to have, for example, what were, as I remember, called election bribes. Governments would have a couple of years of really difficult and unpalatable policies and then, suddenly, at the end of their four or five years, they would have a big pot of money. They would say that that was because their policies were working and they would blow the money on a pre-election splurge.

The difficulty is that that would perhaps be a temptation for a Government that was building up such a reserve. If it was 4 or 5 per cent behind in the polls, for example, it might feel a need to oil the wheels a bit and say that all the difficult policies that it had enacted over the past three or four years were working so fantastically well that it had managed to generate additional funding. Therefore, there are real difficulties with the approach that you suggest not just from a presentational point of view; the money would be a temptation to Governments.

When I was on Glasgow City Council, I looked at rent increases. Every year for 40 years, the lowest rates of increase were in election years and the highest rates were in the year after an election. I do not think that Glasgow was alone in that.