Chamber and committees

The next agenda item is evidence on the Aggregates Tax and Devolved Taxes Administration (Scotland) Bill. I welcome to the meeting Jonathan Sharma, policy manager for local government finance at the Convention of Scottish Local Authorities; Alan Doak, director of the Mineral Products Association Scotland; and Dougie Neill, the group general manager for NWH Group, who is representing the Scottish Environmental Services Association.

I intend to allow up to 90 minutes for the session. If witnesses would like to be brought into the discussion at any point, please indicate to the clerks and I will call you. Rather than having an opening statement, I will move straight to questions.

Mr Doak, the bill’s policy memorandum states that the proposed Scottish aggregates tax retains the fundamental structure of the United Kingdom aggregates levy and offers

“a degree of continuity for taxpayers ... while also ensuring that the devolved tax can evolve over time to support Scottish Government circular economy objectives.”

How does a tax of £2 a tonne deliver that?

No, but the Government has indicated that.

You are saying that to enable greater investment in new technologies that will upgrade the quality of secondary materials, you are looking for an increase in the levy. Would I be right in saying that?

Your submission talks about secondary aggregates and, in particular, incinerator bottom ash aggregate, being

“strongly reliant upon the Scottish Aggregates Tax to remain competitive in a challenging market, allowing large-scale landfill diversion and avoidance of raw material extraction.”

One of the issues that were raised during our visit last week was that, although the quality of recycled materials is improving all the time, there is still a view that they will never be as good as primary aggregates in certain areas.

Mr Sharma, in COSLA’s submission, you ask:

“Should the intention be to increase the incentive to move away from sourcing primary aggregates to secondary recycled aggregates, then how might this impact on Councils’ ability to procure at reasonable cost?”

I take it that you are looking for a break whereby, if local authorities or other public authorities were buying aggregates, there would be a tax on primary aggregates but not on secondary aggregates. How would a bigger shift to secondary recycled aggregates have an adverse impact on COSLA?

Why is inert waste not reducing quite so quickly? Is that because there is no tax incentive to change, for example?

I am inquiring because the evidence session after this is on a similar issue. The £102.10 rate that we have in the current financial year seems like quite a disincentive but the £3.25 rate does not. That is why I am wondering whether that has impacted significantly on the level of inert waste increasing relative to the level of non-inert waste.

Just one last question. I understand that there has been a significant increase in fly-tipping across the UK. Do you know how much fly-tipping has increased in Scotland, and whether the tax on non-inert waste has impacted on that? There are suggestions that it may have had an impact.

Sorry—I am asking about the higher rate, not the lower rate. The higher rate is more than £100 a tonne. The revenue to the Scottish Government is decreasing because less is going to landfill. Is that because there is a genuine and significant change in behaviour, or is fly-tipping going up? Is it more likely to be both those things?

Could you talk me through the transport, net zero and just transition portfolio budget? On the one hand, we have been told that it is receiving additional funding of £81.6 million, the vast majority of which is to be provided as additional borrowing capacity for Scottish Water, while on the other, the actual overall Scottish Government portfolio figures show a reduction from £4,307.8 million to £4,068.7 million, which is a decrease of £240 million or 5 per cent. Those figures do not seem to add up.