Chamber and committees

You are right to say that the initial £25 million during this financial year was from Covid consequentials. That goes to the heart of comments that I made in my opening remarks about the difficult choices in the budget. There are some difficult choices on where to prioritise funding, which I am not shying away from. Areas across the board were previously funded by Covid consequentials, and we have had to determine whether they can be absorbed in our budget.

I have engaged with representatives of STERG, and we have not withdrawn our support for the recommendations in the STERG report. We have previously accepted the recommendations. I would very much like us to be able to progress those recommendations, and I am working with VisitScotland and others to see how we might do that. The door is not closed on trying to progress them with financial support, but we have not identified a specific ring-fenced pot of money in the budget to progress them.

I have been in conversation with the tourism industry quite intensively over the past month or so. There is an opportunity, particularly once all the protections are removed and tourism can function fully and trade normally. There is a real appetite to then focus back on recovery. I would like to see whether there is more that we can do on the finances to ensure that we can progress some of the early points.

The tourism industry is citing the real need to invest with confidence. That comes from marketing internationally as well as locally. We have perhaps been holding off on our commitment to invest in a big marketing campaign because of the uncertainties of the time that we are living in, particularly when it comes to international visitors. There is still a commitment to do that when the time is right, and the door is certainly not closed on identifying additional support, but that will probably need to be in-year rather than in the budget.

I will focus on the young persons guarantee, and Helena Gray, who is attending the meeting, will probably be able to provide a bit more information.

We have allocated funding to the young persons guarantee and I think that it is progressing very well. We are working well with partners and with private and public sector employers to ensure that there are opportunities for young people. In the early parts of the pandemic, we were concerned that there would be a significant impact on young people’s employability. Substantial funding has been made available and the ambitions have not changed. I will not overspeak on that, because I think that Helena Gray can flesh that out.

The rural tourism infrastructure fund is close to Fiona Hyslop’s heart and it is extremely close to my heart, considering my constituency interests, which have significantly benefited from the fund, which she announced when she was a minister. It was a pioneering fund at the time, and it has unlocked huge amounts of economic potential in some of the more remote and rural areas. It was a very forward-looking initiative, for which I thank her. I am absolutely still committed to RTIF.

On VisitScotland’s overall budget, its core budget has returned to pre-Covid levels. In doing comparisons for all the public bodies, I would encourage the committee to look at the pre-Covid position, where we stripped out Covid consequentials. There was a significant amount of Covid consequentials in the VisitScotland budget. I do not for a minute argue that there is not an on-going Covid impact, but I do not have Covid consequentials in any part of my budget, because there are no Covid consequentials from the UK Government sitting separately. That is the position for VisitScotland. We have done all that we can to protect the budgets of the key enterprise bodies, including VisitScotland’s.

I think that we can make progress. That goes hand in hand with other work that we are doing on community wealth building, for example. On the economic opportunities that sit outside the traditional model of the past few years—the Companies House registered business—there are alternatives. We want to continue working with Co-operative Development Scotland and the enterprise agencies to support such opportunities.

To be honest, we will probably not do that—unless the member or others can provide me with substantial evidence of a disconnect between the overall cost and the voucher scheme. The voucher scheme is supplemented by UK Government vouchers, which increases the overall pot that is available. The value of the voucher is determined by whether a business is in scope for R100 or not. If you are referring to those that are in scope, I point out that it is much harder to justify an increase because they will ultimately get broadband. However, I appreciate that they want it earlier; that is absolutely understandable. I have bigger concerns about businesses that are not in scope and are not having the overall costs covered.

On timetables, my intention is to publish that strategy following the UK spring statement, at least four weeks prior to the summer recess. If we are unable to meet that deadline for reasons that are outwith my control, the normal process is to consult the Finance and Public Administration Committee. We will make sure that the committee is sighted on that. That is my intended timetable for May.

I will answer the question in two parts. The first is that, although I do not want to constantly compare households north and south of the border, it is important to do so, because the same overall settlement is involved, as a result of the Barnett formula. Shona Robison has said that council tax is lower in Scotland than elsewhere. We should remember that, on average, council tax went up significantly in England last year after a number of years of rises, whereas, in Scotland, there has not been the compounding effect of an increase last year. That is precisely why, on average, band D charges are about £590 more in England and £423 more in Wales than they are in Scotland.

On what we are doing, witnesses on the previous panel alluded to the fact that, from April, we are reforming the council tax reduction scheme, with £351 million being baselined in the local government budget for the policy costs. We have changed the scheme to ensure that we do not miss people as a result of changes to universal credit. In other words, we are trying to cover as many eligible households as possible. For the past few years—certainly the past five years—the money that we have provided to cover council tax reduction schemes has been higher than the demand, so there has been headroom for local government to manage that.

My final point is that we cannot look at council tax arrears in isolation. Challenges with paying council tax are part of a challenging financial situation for households. We cannot look at the council tax reduction scheme, for example, in isolation from our wider budget commitments. There is £197 million in my budget to double the Scottish child payment and extend it to under-16s. Over the past few months, Shona Robison has taken forward a huge amount of work to provide additional support to households.

We need to look at the wider support. Without getting too political, a lot of that is compensating for a welfare system that does not help families when they need to be helped. Removing £20 a week from households will not help them to pay their council tax.

I assume that you are talking about the funding for business support relating to omicron.

I have another meeting with my counterpart in the UK Government in the next few weeks—in fact, it might be this week. I think that it is. I apologise; it has been brought forward because of omicron. Covid consequentials are one of the most frequently raised issues on my agenda for meetings with the UK Government, so I will again talk about the need to cover them.

Off the top of my head, I cannot think of any budget that has been immune to the impact of Covid. Whether it is justice remobilisation or the need to remobilise hospitals and wider social care services, Covid has an impact right across the board. Nonetheless, we have a budget from which Covid consequentials have been stripped out. Over the past two years, they have amounted to about £14 billion. Last year, it was about £4 billion. That money will not be available but we still need to absorb the costs of Covid because we cannot wish it away. That means that Covid is clearly a priority, so we rightly have to meet the costs of it, but that puts pressure on other things that we want to do. That is how I frame the matter.

One of the last things that I did in the past financial year, just before purdah started, was to allocate an additional £275 million of Covid consequentials to local government, over and above the £259 million—if memory serves—of Covid consequentials in the settlement for local government. A considerable amount of funding was allocated to help local authorities with Covid pressures.

However, those payments were clearly one-off Covid consequentials in the same way that Covid consequentials are one-off payments for us, which makes it harder for local government—in the same way that it makes it harder for us—to deal with the on-going costs of Covid without additional funding to deal with it.

Will I answer that one?