Chamber and committees

I do not make many suggestions.

I will move on. Is the contingency increase from £1 million to £1.5 million simply cover in case inflation hits a particular area harder than we expect?

That was kind of you, convener.

Just to pursue the pay side of things, if my understanding is correct, an increase of 2 per cent was built into the budget for the current year. You indicated that we could cope if it went up to 5 per cent during the year, but once it went over that, cuts would have to be made to balance it out, and extra would have to be paid. What assumption on pay is built into next year’s budget?

To pursue something that Michelle Thomson raised, a practical point is that, if one or more of the pay disputes is not settled by 31 March 2023, that presumably means that there is money sitting in this year’s budget that could have been paid out but will not be paid out until next year. Will that go into the reserve?

I understand that, although I think that the Scottish social attitudes survey said that the public were open to higher taxes and redistribution. Also, the expert panel made the point that we are not very progressive on property taxes generally at the moment.

You also used the word “caution” in the introduction. You are not arguing against measures such as increasing the child payment or putting more into the health service. You are not talking about that kind of fiscal commitment, are you?

That was very helpful.

My final question is perhaps also for Dr Brewer, to start with. In the report, you mentioned that

“Although it is normal for debt to increase during a recession, the UK has failed to address the accumulation of debt following the financial crisis and the pandemic.”

Should we be worried about the level of UK debt?

Thank you—that was very helpful.

On the issue of where the UK is raising money from, you mention in your report that new energy levies are a part of that. There has been some debate about whether such levies discourage investment or, because they are just one-offs, they do not really have an impact. What are your thoughts on that?

Do you have a date as to when we are going to hit that limit?

Undoubtedly, there will be another crisis somewhere along the line.

The committee heard from the expert panel earlier and the witnesses made the point that the UK has failed to address the accumulation of debt following all the different crises that we have had. If I remember correctly, when I was younger—I believe that I am the oldest member of the committee—interest rates had to rise because the pound was getting weak, and the UK debt was so great that interest rates had to be above inflation. Is there any risk of that happening again?