Chamber and committees

I appreciate that answer, but if I was working in local government or the university sector, which, like local government, will be somewhat better off than it would have been under the plans in the RSR—although I acknowledge that those sectors will continue to feel that they need to ask for more money—on what basis should I use the RSR for forward planning, given that the specific numbers in it are no longer valid? Should I presume that the broad trajectory will continue—for example, the flat-cash trajectory for sectors such as the university sector? Should I assume that there will be flat cash in 2024-25 and 2025-26, based on what is in the 2023-24 budget?

Yes. It is usually at the end of January or the start of February, but I presume that it might be somewhat later than that this year.

Thanks. I acknowledge that it will be hard to disaggregate behaviour changes that are specifically the result of a change in tax policy as opposed to wider factors in the economy. However, such disaggregation would be valuable, if it is at all possible, as we scrutinise the future direction of tax policy.

I have a brief question about the current year’s budget before I ask about next year’s draft budget. Given the current uncertainties around public sector pay settlements, for example, at what point should we expect the spring budget revision?

That will be useful.

I turn to next year’s draft budget. What status should we now give the resource spending review? When it was developed and published, there was an acknowledgment that, as each year that is covered by the RSR passed, there would almost certainly be gradual divergence. However, we are now in a position in which there is immediate and significant divergence in year 1. For local government, there is £550 million more than was laid out in the RSR. If I was working in local government and trying to plan ahead for budgets, should I presume that the 2024-25 budget will provide flat cash relative to what is proposed for next year, or should I look back at the numbers for that year that are contained in the RSR?

I have a final question that relates to various members’ questions about behaviour change and tax policy. There have been relatively significant changes in tax policy, such as the 2018 changes to income tax and the changes to council tax—I think that those were in the same year, or it might have been the year before. Was there a significant difference between the outcome of those changes—the revenue that was eventually raised—and the behaviour changes that the SFC assumed would happen? I recognise that there are questions for the commission about methodology in that regard, but can you say whether behaviour change resulted in anything that was significantly different from what had been budgeted for?

I will return to the additional dwelling supplement. If you were to assume no behaviour change because of the rise from 4 per cent to 6 per cent, what would the additional revenue have been from that?

Therefore, there is a roughly £20 million projected loss because of behaviour change.

I am sorry, Graeme. I probably phrased that wrong. You are assuming that the additional change to the rate will result in behaviour change that would be worth around £20 million, but at what point would it have resulted in a change that would be equivalent to the amount that it would otherwise raise if there was no behaviour change? At what point would we raise it by so much that the amount of money that is coming in would be no more than it was in the previous year at a lower rate? I presume that, if we were to raise it to 20 per cent, we would take in a lot less money than we did from ADS specifically last year. I take your point that we would probably bring in more LBTT, but the amount coming in from ADS would be a lot less.

[Inaudible.]—from wider economic changes.