Chamber and committees

As I understand it, you are more concerned about what is going to happen in two years’ time than, perhaps, what is going to happen immediately. You say in your report:

“Adding future fiscal commitments or pressures at this time given the spending outlook is unwise and would require a larger subsequent adjustment.”

Do you think that such things are happening? Are “future fiscal commitments” being made that should not be made, or are you just giving a general warning that we should not be making any major new commitments at this time, given Professor Ruane’s comment that the whole country is becoming poorer?

There is no public pay policy for 2023-24, which is a point that has already been made. We all understand that that is because we do not know what the public pay policy for 2022-23 is. Was that a problem for you when you were forecasting? How did you take that into account?

We have mentioned capital expenditure. There is a borrowing limit of £3 billion. Where are we with that? How close are we getting to the borrowing limit, and how scared should we be?

That is fair enough.

Your report quoted Andy Haldane saying that the situation around health is acting as a “brake on economic growth”. Will you expand on that? Do you think that Covid, long Covid and waiting times in hospitals are having an impact on the economy?

Normally, negative inflation would be seen as a bad thing, but is that not necessarily true in this case?

Thank you.

In your report you say:

“Over the longer term, the size of Scotland’s economy is determined by its potential output. In the current context, both the underlying capacity of the Scottish economy to produce goods and services”

and

“its potential output”.

I am unclear about the phrase “underlying capacity”. Can you explain what that means?

I presume that normally that does not change very much from year to year.

The interim commentary report talks about public sector reform, the public sector becoming more productive and, in particular, digital technology. Can you say any more about what we should be focusing on or changing in the public sector?

Yes, I am asking for a UK perspective, because that is where the levies are happening.

I will stay on the inflation theme, which has been dominant today. I get mixed up about which witness gave us which evidence at previous meetings, but someone suggested that inflation would become quite severely negative, and someone also used the word “permanent” in that context. Is it possible that oil and gas prices will come back down to where they were?