Chamber and committees

Thank you.

Thank you, cabinet secretary. You have covered quite a lot of ground, but the committee has a lot of ground to cover, too. Each member will have about 15 minutes for questions and answers.

I will start. You mentioned the key figure of next year’s budget and the potential negative income tax reconciliation, which was, I think, £712 million—actually, I think that the figure for negative tax reconciliation is £687 million in total. Can you explain a little more your thinking as to how you will deal with that? Can some of the money be borrowed? Where will the rest come from? We will direct our questions to you, cabinet secretary, and it will be up to you to bring in your officials.

We accept that we cannot have a running commentary, but both our committees and the committees at Westminster need to do a certain amount of scrutinising. Can you give us any idea of timescales? I believe that the initial report has been completed, but not published, and then there is meant to be a review. Do the negotiations come after that?

Can you say anything about the issues that will be involved? Clearly, borrowing has been mentioned, and capital borrowing is another issue to address. There are other issues in the background that have not been dealt with, such as air departure tax and VAT. Do you expect those to be part of the negotiations?

Good morning, and welcome to the 18th meeting in 2023 of the Finance and Public Administration Committee.

Our first agenda item is an evidence-taking session with Shona Robison, the Deputy First Minister and Cabinet Secretary for Finance, on the Scottish Government’s medium-term financial strategy, the Scottish Fiscal Commission’s economic and fiscal forecasts from May 2023 and her priorities under the First Minister’s policy prospectus. Ms Robison is joined by Scottish Government officials Kathy Johnston, deputy director in the office of the chief economic adviser; Alison Cumming, director of budget and public spending; and Andrew Scott, director of tax and revenues. I welcome you all to the meeting.

I invite Ms Robison to make a short opening statement.

That raises a range of different issues, which colleagues will come in on when they get their turn.

You have mentioned the fiscal framework review. Can you give us any idea of the timescale for that? Is there any chance that anything can be done for the 2024-25 budget, which looks like it will be pretty crucial? Is it even possible to separate out some of the longer-term issues? Obviously, getting the borrowing limit and some of the figures in that respect changed will be quite urgent. As we have discussed at committee and with the Fiscal Commission, given inflation and the increase in Scottish Government powers, the £300 million figure is really out of date, is it not?

Douglas Lumsden is next.

That is great. Thanks.

One of the points that has come up from a few questioners is the uncertainty of the timing of the UK Government’s budget setting. That issue has come to the committee quite a lot. Although it is a request rather than a question, can you press the UK Government? I know that you cannot dictate to it.

If we had consistency every year as to when the UK Government budget was set, we could build on that budget, and local government and everybody else could come afterwards.

You mentioned the external tax stakeholder group. Some of us feel that we have talked about tax quite a lot. Obviously, I fully agree that we need to engage the public more on why we have tax, whether tax is a good thing or a bad thing and other such questions. However, can you explain a little more why we need the external tax stakeholder group? To take a specific example, we have been planning to replace council tax for ages, but it still has not happened.