Chamber and committees

In answer to colleagues, you highlighted the impact of the 62 per cent cut to the financial transactions budget. Obviously, we have a budget coming up on 30 October. If the Treasury does not reinstate those financial transactions moneys that were previously available to the Scottish Government and Scottish Enterprise, what will the impact be on your ability to deliver your strategy?

Would it be fair to say that, if financial transactions budgets do not change and do not increase again, and if capital investment from the Treasury does not increase, that would make all of your jobs much more difficult and it would be much more difficult to grow the Scottish economy sustainably?

It would also be much more difficult to lever in private investment if we do not have that kick-start money from the UK Treasury.

I recognise that the amendment was lodged before the UK Government’s decision to slash winter fuel payments. In itself, amendment 5 means an extension to the social security system, which I am not against.

Mr Balfour talked about mitigation. Again, I am not agin mitigation; we have mitigated a lot of cuts in the Parliament previously. However, it annoys me when advocates for the union, such as Mr Balfour, come here with the expectation that the Scottish Government should be able to extend, expand and mitigate when the resources are not coming from the UK Treasury. Let us face facts. The cabinet secretary is going to have to deal with some of these issues, knowing fine that £160 million that she expected has now been pulled by the UK Treasury.

I get the points that Mr O’Kane and Ms Clark have made about further exploration of all this; it needs to be done. We also need to be blunt with the UK Treasury about the scenario that we now face.

Ms Clark talked about consequentials. I believe that we should always interrogate consequentials to see what can be done with them. In this case, however, we are facing negative consequentials, with £160 million being pulled out of the Scottish Government’s budget with a snap of the fingers. That is not good enough.

I think that committee members, instead of talking about expansion right now, have to look at the cards that we have been dealt by the UK Treasury and the Westminster Government, and recognise that we cannot mitigate the impact of every single decision, in particular when £160 million has disappeared just like that.

Will Mr Balfour give way?

We do not mirror everything that is happening south of the border. For example, look at the investment in the Scottish child payment and the fact that benefits here have risen above inflation, which has not happened south of the border.

However, we also have to deal with the realities. As I said earlier, Mr Balfour is a supporter of the union. That is up to him, but he also has to recognise that the actions of the UK Treasury have implications for spend here in Scotland. When £160 million disappears, that does not leave much room for manoeuvre, and it certainly does not leave any room for the expansion of benefits or for further mitigation. I think that Mr Balfour has to deal with that reality.

I do not think that amendment 6 would be completely unreasonable if Parliament had full control over finance, which we do not. All roads lead to Westminster, as Wes Streeting said during the election campaign.

I am quite sure that the cabinet secretary would wish to support the amendment in other circumstances. Of course, under her watch, devolved benefits have increased by more than inflation recently. However, we have to recognise that the UK Treasury still holds the purse strings. There have been some surprises of late, and there might be more to come, given that the Prime Minister has said that things are only going to get worse.

The reality is that the cabinet secretary and I have no idea what future block grant provision will look like. We would be asking the Scottish Government to ensure that everything rose by the rate of inflation, not knowing whether we would get the block grant required to be able to do that. That is a simple fact. I point out again that, as a supporter of the union, Mr Balfour is quite happy for the UK Treasury to hold those purse strings. I am not, but, while we live in that world, the amendment puts the cabinet secretary and the Scottish Government in an almost impossible position, because they do not know what future financial provision there will be from the UK Treasury.

Not in real terms.

I thank Professor Roy for highlighting the north-east premium, which we should all take note of. In doing that, we should also ensure that there is no regional contraction and that we get it right for every region in Scotland.

Elsewhere in the world, there has been major investment in the move to net zero. The green new deal in the United States has brought in $234 billion and there has been investment in Scotland in the north-east and Moray through the just transition fund. The Labour Party promised £28 billion a year for green initiatives, but that sum has contracted quite dramatically. That investment—if it is there—should drive change.

I want to concentrate on jobs and data. Professor Bell said that we require clarity on data. The Climate Change Committee published analysis that suggested that there is the potential to create between 135,000 and 725,000 jobs across the UK by 2030 in new low-carbon sectors. Can I ask about that data? What assumptions might you have made in reaching those figures and how accurate do you think that some of that data is?

You talked about getting the planning right. Quite frankly, I would like to keep the people that Aberdeen and the north-east have gained over the piece. In relation to your report and to other discussions, there are obviously major concerns about the mismatch between the timing of the switching off of the old industries and the switching on of new industries. We all recognise that the oil and gas sector is in its twilight years. However, as Professor Roy said, it is not at an end and we will require oil and gas into the future. We should be endeavouring to make sure that we are also creating other jobs as oil and gas jobs diminish.

On planning and policy, do you think that the UK Government’s recent announcements, such as the chancellor’s statement, provide the planning and the policy to get this right, or is it a case that such announcements have been driven by current fiscal situations rather than getting it right for a just transition?