Chamber and committees

Therefore, that could be built into the data that is available, but currently it is not. Even on some kind of sampling basis, it would presumably be possible to gauge the relative balance between PAYE and self-assessment liabilities in both jurisdictions.

Another point strikes us in relation to the methodology, which the Auditor General for Scotland reflected on in last year’s report. Paragraph 16 of this year’s report, which notes the NAO’s report, states that the

“methodology has remained broadly the same since the prior year.”

This time last year, we were having conversations with Scottish Government officials, as well as with HMRC, about the methodology, the service level agreement and the quality of data that was being procured, because there is obviously a financial cost to it.

Last year, Gareth Davies commented:

“Clearly, if you had a more highly specified agreement that got into some of the areas that we have been talking about today”—

why we cannot get more qualitative data and fewer estimates—

“it is likely that HMRC would require more costs to be covered. However, on the basis of the agreement that is currently set out, we think that the cost is fairly stated.”—[Official Report, Public Audit Committee, 3 February 2022; c 25.]

In other words, we were getting into the terrain of suggesting that, if the Scottish Government was prepared to pay a little bit more money to HMRC, it could perhaps get some better-quality data.

In her evidence last year, Alyson Stafford from the Scottish Government said that

“the committee’s consideration is extremely timely for us to take your observations and comments into account”

and that the Government was

“looking at data breadth and depth.”—[Official Report, Public Audit Committee, 12 May 2022; c 41.]

However, nothing appears to have changed. Is that a fair estimate of what is going on here? Nothing.

Good morning, and welcome, everybody, to the fifth meeting in 2023 of the Public Audit Committee. Under the first item on the committee’s agenda, do members agree to take agenda items 3, 4 and 5 in private?

Members indicated agreement.

Thank you very much. I will kick off. You make the point that HMRC estimates that Scottish income tax revenue in 2021-22 will be £13.2 billion, which would be an increase of about 11.3 per cent on the previous year—a year when the economy was in lockdown—but it is also estimated that the increase in the UK will be 13.2 per cent, which is significantly more than in Scotland. Why is there an expected difference between UK performance and Scottish performance?

Yes.

That clarification is helpful—thank you for that.

Obviously, the estimates are in the domain of the decision-making process, so they are quite important to us. That is why we have taken the view that having better data would give us a clearer sense of where policy should go and what will have the most impact in relation to raising revenue or redistributing the burden of taxation.

The Auditor General wants to come in on that point.

Thank you. There is a whole other area that we want to explore, which includes the tax gap and other data issues. Colin Beattie will lead on that.

Thank you. Obviously, the committee will consider what its next steps are on that, but there would be interest in understanding whether private debt collection agencies are now being deployed.

Auditor General, I want to touch on something in your report. In paragraph 42, which is in the section on taxpayer behaviour, you say:

“In my view, the publication of the income tax behavioural analysis and the development of a dataset to track taxpayer responses to income tax changes over time is a positive development.”

Can I check with you where that is? I have not seen anything published yet, but is there an expectation that something will be published later this year? Has work been commissioned to get that data set and put it into the public domain?

The principal reason for our meeting is to take evidence on the “Administration of Scottish income tax 2021/22” report, which was produced on 12 January this year by the Auditor General for Scotland and is, in turn, a commentary on a report that was prepared by the National Audit Office.

I am pleased to welcome our four witnesses, who are here in person this year. Stephen Boyle, the Auditor General for Scotland, is accompanied by Mark Taylor, audit director at Audit Scotland. I am particularly pleased to welcome Gareth Davies, Comptroller and Auditor General at the National Audit Office, who is appearing in person before the committee for, I think, the first time. He is joined by Darren Stewart, audit director at the NAO.

We have a series of questions to put to the witnesses, but I begin by inviting the Auditor General for Scotland to make a short opening statement.