Scottish Parliament, 8 June 2022

263 contributions from 57 members. The official report.

Covid-19 Recovery and Parliamentary Business

Liam McArthur (Liberal Democrat, Orkney Islands)

Good afternoon. The first item of business is portfolio question time. The first portfolio is Covid-19 recovery and parliamentary business. If a member wishes to request a supplementary question, I invite them to press their request-to-speak button during the relevant question or by entering the letter R in the chat function. I make the usual plea for short and succinct questions, and for responses in a similar vein.

Spoilt Ballots

Martin Whitfield (Labour, South Scotland)

1. To ask the Scottish Government what analysis it plans to undertake into spoilt ballots at the 2022 local government elections. (S6O-01182)

George Adam (Scottish National Party, Paisley)

At the recent local government elections, 1.85 per cent of ballot papers were rejected by returning officers. That was an improvement on 1.95 per cent in 2017. The most common reason for a ballot paper being rejected was that the voter had marked more than one first preference. It is a matter of great concern if any voter loses their vote.

We will continue to work with the Electoral Commission and the Electoral Management Board to explore what more can be done to support voters to further reduce the number of rejected ballot papers, so that every vote counts.

Martin Whitfield (Labour, South Scotland)

Subjective evidence seems to suggest that spoilt ballot papers in multimember wards may have arisen from postal ballots, given the incredibly hard work that polling staff undertook to remind in-person voters of the ranking system. Is the Government aware of that view, and will it, along with the Electoral Management Board for Scotland, undertake a review, given the challenges of identifying spoilt papers in postal votes?

George Adam (Scottish National Party, Paisley)

I have not been made aware of that specific issue, but I am quite happy to have a look into it and to work with the Electoral Management Board and the Electoral Commission to make sure that every vote does, indeed, count.

The Deputy Presiding Officer

We have a number of supplementary questions. I will try to get through all of them.

John Mason (Scottish National Party, Glasgow Shettleston)

I am a real fan of the single transferable vote, but having one ST vote every five years is a problem when all the other votes are marked with an X. Unlike Martin Whitfield, I realised that people were marking their ballot papers with multiple Xs, despite what polling station staff were doing. Does the minister think that we can continue with STV once every five years?

George Adam (Scottish National Party, Paisley)

As John Mason will be aware, the STV system takes us away from the traditional cross on the ballot paper. He will also be aware of the many benefits of STV. Although it has been in place since 2007, it is a less familiar process for voters. I agree that it is vital that people do not lose their vote, which is why I will continue to work with the Electoral Commission and the Electoral Management Board to explore what can be done. I would encourage all of us who are involved in the political process to engage with the public on the many benefits of the STV voting process.

Christine Grahame (Scottish National Party, Midlothian South, Tweeddale and Lauderdale)

There were more than 50 candidates in Midlothian, and there are such small margins between the winners and the losers in these votes. I noted that some returning officers were explaining the system to each voter who walked in, even if they said that they understood it. However, that was not happening at every polling station. Will the minister consider the instructions that were given to people who were working at the polling stations about what to say to explain the system to voters as they came in?

George Adam (Scottish National Party, Paisley)

People at polling stations were well aware of how the system works. As I said, we have had the system since 2007. I say again that we have a responsibility, as members of political parties, to make sure that members of the public are aware of how the system works in the future.

Kenneth Gibson (Scottish National Party, Cunninghame North)

Does the minister agree that it is time to have randomisation of ballot papers so that the influence of the alphabet is not as strong as it has proven to be over the past 15 years?

In the current system, people whose name is higher up the ballot paper have a clear, distinct advantage—particularly new candidates who are standing for the same party. Therefore, Alasdair Allan could easily defeat Willie Wallace if the two of them were standing for the same council ward. The Scottish National Party has randomisation of ballot papers in its internal structures. Surely, it is about time the Scottish Government brought in randomisation for local government elections.

The Deputy Presiding Officer

I think that you are mixing up your island communities, Mr Gibson.

George Adam (Scottish National Party, Paisley)

Yes, Presiding Officer. I may have some skin in the game, as does my sister, who is a councillor in Renfrewshire, but I believe it is not as big a problem as many have made out.

Again, it is down to us, as those who are involved in the political process, to ensure that the public are aware of how the system works and to think about how political parties can make sure that the vote is to the full capacity.

As I have said to everyone else, I am quite happy to work with anyone to see whether we can get a better system. I will work with the Electoral Commission and the Electoral Management Board to see whether there is anything else that can be done. However, until that day, we have a system that gives us a result that everyone agrees with and that everyone believes is the correct result. That is more important than just about anything else in the democratic process.

Covid-19 Recovery (Cross-Government Policies)

Emma Roddick (Scottish National Party, Highlands and Islands)

2. To ask the Scottish Government how its cross-Government Covid recovery policies can reassure clinically vulnerable members of the public. (S6O-01183)

John Swinney (Scottish National Party, Perthshire North)

The highest risk list ended on 31 May 2022, as we have strong clinical evidence to show that, as a result of the vaccination programme and new medicines, most people who were on the list are at no greater risk from Covid than the general population. The Scottish Government has written to those who were formerly on the highest risk list to provide advice and guidance.

The Scottish Government continues to promote the distance aware initiative, which helps people to feel more comfortable in public spaces, and we strongly recommend that people still follow basic mitigations such as ensuring adequate ventilation and wearing face coverings where appropriate. Our approach to testing in different groups of the population will also continue to be informed by clinical advice.

Alongside our evolving response to the pandemic, the Scottish Government’s Covid recovery strategy will continue to focus effort and resources on those who were most impacted during the pandemic, to ensure a fairer recovery.

Emma Roddick (Scottish National Party, Highlands and Islands)

Many constituents in the Highlands and Islands who have pre-existing conditions that make catching Covid—even now—more dangerous than it is likely to be for others have been in touch with me to seek better protection from the virus.

How can people, particularly those who are not eligible for boosters, remain safe now that restrictions have been lifted but Covid is still circulating?

John Swinney (Scottish National Party, Perthshire North)

I whole-heartedly sympathise with the point raised by Emma Roddick on behalf of her constituents and those who are more vulnerable to Covid.

The Government’s advice, which I set out in my initial answer, is that people should follow sensible precautions. There is also an obligation on others within society to respect the position of people who feel more vulnerable. Those precautions would include the wearing of face coverings where that is appropriate, ensuring adequate ventilation and maintaining good hygiene.

We will, of course, continue to monitor the situation in relation to Covid, and, should there be any requirement for us to either change or intensify the advice, those steps will, of course, be taken.

The Deputy Presiding Officer

We will have a couple of brief supplementaries and brief responses.

Jackie Baillie (Labour, Dumbarton)

Asymptomatic testing has ended for carers and those who are cared for, antivirals are restricted, the platform adaptive trial of novel antivirals for early treatment of Covid-19 in the community does not apply in Scotland, and people aged over 80 who have Covid are being asked to travel distances—from Helensburgh to Oban in one example—to get antiviral treatment.

Those on the shielding list and carers feel abandoned. They were not reassured by a meeting that they had with the Scottish Government. With the BA.4 and BA.5 variants now causing concern, why has the cabinet secretary withdrawn or limited the very things that provide the vulnerable with reassurance?

John Swinney (Scottish National Party, Perthshire North)

A range of different measures remain in place that are designed to support those with vulnerabilities. Jackie Baillie mentioned the availability of antiviral medicine, and I know the effectiveness of that for people who are clinically assessed as being the ones who will benefit from it. [

Interruption

.]

Jackie Baillie continues to assert her question from a sedentary position, but my point is that a clinical assessment is undertaken, and I do not think that Jackie Baillie would be at the front of the queue to doubt the clinical assessments that have to be done.

There is a combination of the precautions that I talked about in my response to Emma Roddick a moment ago and the availability of focused treatments to support individuals, should they be in a position of clinical vulnerability. Of course, there is also the protection that is offered by a range of provisions in the vaccination strategy, which has insulated the population so effectively from the serious effects of Covid.

Stephanie Callaghan (Scottish National Party, Uddingston and Bellshill)

Public Health Scotland’s findings from its most recent survey of people on the high risk list shows that socioeconomic vulnerability remains

the strongest association with on-going caution and fear of Covid-19 infection. Is there any further information on how cross-Government Covid recovery policies will respond to that?

John Swinney (Scottish National Party, Perthshire North)

Fundamentally, the Covid recovery strategy is focused on tackling inequality that existed before and that was exacerbated by Covid. Our efforts are now focused on ensuring that the socioeconomic inequalities that Stephanie Callaghan highlighted are addressed as a consequence of our cross-Government work on Covid recovery.

Net Zero (Parliamentary Debate)

Maurice Golden (Conservative, North East Scotland)

3. To ask the Scottish Government when it will next propose a parliamentary debate on reaching net zero. (S6O-01184)

George Adam (Scottish National Party, Paisley)

That is a matter for the Parliamentary Bureau. However, I note that, yesterday afternoon, the Cabinet Secretary for Net Zero, Energy and Transport gave a statement to the chamber—and responded to members’ questions—on progress towards Scotland’s statutory emissions reduction targets.

Maurice Golden (Conservative, North East Scotland)

I thank the minister for that answer, but, given the Scottish National Party’s awful environmental record, this Parliament needs more opportunity for scrutiny. Just yesterday, as the minister alluded, we heard the cabinet secretary all but confirm that he expects next year’s emissions target to be missed. The flagship deposit return scheme has been delayed twice, the recycling rate is going backwards, and one in nine species is at risk of extinction. Can the minister see how that lack of debate looks like the Scottish Government is trying to hide from its failures?

George Adam (Scottish National Party, Paisley)

It is hardly hiding when the Cabinet Secretary for Net Zero, Energy and Transport answered questions yesterday and said that we have hit our annual targets. However, should the member wish to explore those matters further, I suggest that he talk to Stephen Kerr, who is sitting on his right-hand side, and get him to bring the matter up at the Parliamentary Bureau, so that we can discuss it in the usual manner.

The Deputy Presiding Officer

Karen Adam joins us remotely.

Covid-19 Recovery (Banffshire and Buchan Coast)

Karen Adam (Scottish National Party, Banffshire and Buchan Coast)

4. To ask the Scottish Government what policies and actions across Government will support people in the Banffshire and Buchan Coast constituency to recover from the impacts of the Covid-19 pandemic. (S6O-01185)

John Swinney (Scottish National Party, Perthshire North)

During the pandemic, the Scottish Government provided more than £4.7 billion in support to businesses in Scotland. Most recently, our £80 million Covid economic recovery fund is providing funding that affords local authorities the flexibility to target support for their businesses and communities. Aberdeenshire Council and Moray Council have been allocated £3.7 million and £1.3 million, respectively.

Further, since 2020, Aberdeenshire and Moray have benefited from the £6 million of additional support that the Scottish Government has provided to town and community partnerships and business improvement districts.

Karen Adam (Scottish National Party, Banffshire and Buchan Coast)

I thank the cabinet secretary for his answer and I welcome that investment. As the cabinet secretary will know,

Banffshire and Buchan Coast is a rural, coastal constituency that has had unique challenges related to its geography and local industries. Covid has exaggerated the existing issues, which are compounded by Brexit and now the cost of living crisis. The fishing industry and ports are key to recovery because, when they thrive, the area and the people benefit. Will there be bespoke support, which is fitting for various specifics, rather than a blanket approach to recovery?

John Swinney (Scottish National Party, Perthshire North)

In providing the material that I have already given in my answer, I hope that I have reassured Karen Adam that the Government is targeting funding to particular localities where there is demonstrable need. Aberdeenshire and Moray councils have been funded appropriately in that respect.

The Government will continue to look at all funding streams, to make sure that they are relevant and will meet the challenges of different localities in the country. Specific funds, particularly in relation to the transition to net zero, are available only in the north-east of Scotland, which will be of relevance to the communities that Karen Adam represents.

Covid-19 (Booster Vaccination Programme)

Annabelle Ewing (Scottish National Party, Cowdenbeath)

5. To ask the Scottish Government whether it will provide an update on the role that an autumn/winter Covid-19 booster vaccination programme will play in its Covid recovery strategy. (S6O-01186)

John Swinney (Scottish National Party, Perthshire North)

Since its beginning, the Scottish Government’s Covid-19 vaccination programme has been guided by expert advice, provided by the Joint Committee on Vaccination and Immunisation.

The JCVI’s interim advice in May recommends an autumn/winter 2022 booster programme for those people who are at higher risk of severe Covid-19. We are already working closely with national health service boards in line with that advice. The protection of the most vulnerable people in society continues to be of primary importance, and we stand ready to act on any further advice that recommends boosters for additional groups.

Alongside our evolving response to the pandemic, our Covid recovery strategy continues to focus effort and resources on bringing about a fairer future, particularly for those who are most impacted by Covid-19.

Annabelle Ewing (Scottish National Party, Cowdenbeath)

I appreciate that we await the final advice from the JCVI on the autumn/winter booster vaccination, but people in my Cowdenbeath constituency, and across Scotland, would like to know whether they will get the booster. Can the cabinet secretary provide an update on when that information is likely to be forthcoming, and can he confirm that the timing will be sufficient for the Scottish Government to put in place the necessary arrangements should the JCVI widen out the list of those who are eligible?

John Swinney (Scottish National Party, Perthshire North)

At this stage, I am unable to give Annabelle Ewing a definitive timetable, but I quite understand the concerns that she raised and the points that she has articulated on behalf of her constituents in Cowdenbeath.

The JCVI is an independent committee and it is, correctly, taking time to review the emerging clinical evidence including, crucially, the information on vaccine waning, infection rates and hospitalisation. I am certain that, once the JCVI has had the opportunity to do that, it will publish its findings accordingly.

I reassure Annabelle Ewing that, as we have demonstrated over the past 18 months or so, the Government and our health boards are ready to deploy vaccination activity. The vaccination programme has been an extraordinary success, given the scale at which it has been carried out, and I pay tribute to those who have organised and delivered the programme. I assure Annabelle Ewing and her constituents in Cowdenbeath that the same arrangements will be in place if required on the basis of the JCVI’s advice.

Sandesh Gulhane (Conservative, Glasgow)

I have been contacted by a constituent who received an invitation by letter to attend for a spring booster vaccination. After he registered at the vaccination centre on 22 April 2022 and made his way to the vaccination cubicle, the nurse advised him that she could not administer the booster because he was ineligible. The staff at the centre said that they had been turning away people with appointment letters all day because the wrong letters had been sent out.

Will the cabinet secretary advise why that blunder in the administration of vaccinations occurred, and can he provide reassurances that that error—which, no doubt, wasted valuable staff time and NHS costs, and which wasted patients’ time in having to travel—will not occur again?

John Swinney (Scottish National Party, Perthshire North)

The vaccination programme has been an extraordinary success and it has been undertaken at an extraordinary scale. Therefore, I will not stand in Parliament and say that a process at that scale will be error free. For members of Parliament to expect it to be error free is on the ambitious side, if I can put it delicately.

Every effort is made to ensure that vaccinations are delivered timeously and conveniently to members of the public. If there is an error involved, I apologise for that—I want nobody to be inconvenienced and nobody’s time to be wasted—but, given the scale of the vaccination programme that we have undertaken, the number of errors that have occurred has been kept to an absolute minimum, which is a tribute to everyone who is involved in running the programme.

Paul O'Kane (Labour, West Scotland)

The booster programmes are vital in Covid recovery, as they

protect the most vulnerable and, crucially, give confidence to many unpaid carers who feel left behind as things move forward.

The interim guidance for the coming winter booster programme does not include unpaid carers. From speaking to carers, I know that that is of great concern, particularly with the advent of the BA.4 and BA.5 variants and the impact on those for whom they care.

Will the Deputy First Minister commit to working with the health secretary to deliver winter boosters for unpaid carers? What further action is the Government taking to support unpaid carers, many of whom feel abandoned, in the recovery from Covid-19?

John Swinney (Scottish National Party, Perthshire North)

As I explained in my answer to Annabelle Ewing, guidance on the distribution of any booster vaccination is given to the Government by the JCVI. Governments

of all political persuasions have followed the advice of the JCVI in undertaking vaccination programmes over many years, and the Government will listen very carefully to the advice that we receive from the JCVI, which will specify which groups should be eligible for the vaccination.

Carers are in receipt of much greater support in Scotland than in other parts of the United Kingdom, given the carers allowance supplement that is available here. Mr O’Kane will be familiar with the details of that, and he is welcome to promote it to carers, just as the Government promotes awareness of that benefit to carers. Carers do a phenomenal amount of work to benefit our society. I express my warmest thanks to them and hope that those who are eligible for that support are able to access it.

Freedom of Information Requests (Scottish Government)

Stephen Kerr (Conservative, Central Scotland)

6. To ask the Scottish Government what its response is to the Scottish Information Commissioner’s progress report on its handling of freedom of information requests. (S6O-01187)

George Adam (Scottish National Party, Paisley)

I have written to the Scottish Information Commissioner, welcoming the report. I am pleased that the commissioner has recognised a number of areas in which the Scottish Government has made improvement. However, I also recognise that the report identifies significant areas in which further work is needed. Work is currently under way to develop the next phase of our improvement plan, in response to the commissioner’s recommendations. We will share that publicly in the coming weeks.

Stephen Kerr (Conservative, Central Scotland)

I will ask the minister about one of those areas that requires improvement. I accept that the pandemic was a strain, but the complacency in two thirds of Government desks remaining empty shows no ambition to improve FOI response times. Presiding Officer, SNP special advisors are interfering with FOI responses, leaving no record of their involvement. SNP special advisers are evading accountability, remaining anonymous on official SPAD email accounts. Those are not my words but the findings of the information commissioner. Will the minister, in the spirit of the answer that he gave me a few moments ago, commit to immediately ending the SNP dark arts approach to public scrutiny?

George Adam (Scottish National Party, Paisley)

As I have already said, we will undertake the extra work that we need to do to make things better. I recognise that there is a journey of improvement for us to complete. However, we should bear in mind that, in the nine months prior to the pandemic, the Scottish Government hit its target of 95 per cent. We are currently making improvements when and where they are needed, and we will work with the commissioner to ensure that that happens.

Willie Rennie (Liberal Democrat, North East Fife)

Does yesterday’s limited publication of the legal advice on an independence referendum not show a degree of contempt for the information commissioner? The legal advice that is of little interest to the public was released, while the legal advice that is in the public interest was kept secret. When will the Government honour its commitment to openness and publish the legal advice on whether it has the power to hold such a referendum?

George Adam (Scottish National Party, Paisley)

We have released the legal advice that is required under the commissioner’s decision, as that does not merit the time and expense that would be required for an appeal. However, we disagree strongly with the commissioner’s reasoning and consider that there would be good grounds for a successful appeal to the Court of Session.

The United Kingdom and Scottish Governments observe a long-standing convention that Government does not disclose legal advice, other than in exceptional cases. In this case, we have released the information as required.

The Deputy Presiding Officer

Question 7 was not lodged.

Covid Recovery Strategy (Local Authorities)

Colin Beattie (Scottish National Party, Midlothian North and Musselburgh)

8. To ask the Scottish Government what assistance it is providing to local authorities as part of its Covid recovery strategy to help them resume normal services and manage staff absences. (S6O-01189)

John Swinney (Scottish National Party, Perthshire North)

The 2022-23 local government finance settlement of almost £12.7 billion provides local government with a fair and affordable settlement, even in challenging circumstances. As long as councils act lawfully and first fulfil their statutory obligations and jointly agreed national and local priorities, it is a matter for each council to manage its resources and use the total budget that it has available on the basis of local needs.

The Scottish Government and the Convention of Scottish Local Authorities have agreed shared priorities for recovery that focus on targeting support for those who were most affected during the pandemic. Alongside the COSLA president, I chair the Covid recovery strategy programme board, which brings together a range of partners to co-ordinate activity, increase financial security for low-income households, enhance the wellbeing of children and young people, create good green jobs and fair work and deliver person-centred public services.

Colin Beattie (Scottish National Party, Midlothian North and Musselburgh)

Some local authorities are really struggling with high absences due to Covid-19. What discussions has the Scottish Government had with COSLA and/or individual local authorities that are still heavily impacted by staff absences?

John Swinney (Scottish National Party, Perthshire North)

Local authorities are independent corporate bodies, separate from the Scottish Government. They have the means and sustainability to manage their own workforces. However, I regularly engage with COSLA on a range of issues, so, if there are any concerns on that question that local authorities wish to draw to my attention and to discuss through COSLA, I would be happy to discuss those issues.

Murdo Fraser (Conservative, Mid Scotland and Fife)

In her statement to Parliament last week on the medium-term financial strategy, the finance secretary set out that local authorities will face an 8 per cent cut in their funding over the next four years. How does that level of cuts help them with Covid recovery?

John Swinney (Scottish National Party, Perthshire North)

There are, of course, a range of financial instruments available to local authorities in addition to the measures that were announced last week by the Cabinet Secretary for Finance and the Economy. The Government has always given a fair and affordable settlement to local government.

It is available to Mr Fraser to bring forward any alterations to the Government’s budget that he wishes to advance. We hear a lot of rhetoric on this question from the Conservatives, but we see absolutely no action or substance whatsoever. Until we get some action from the Conservatives, we will continue to deliver fair and affordable settlements for local government that enable them to deliver the public services on which we all depend.

Net Zero, Energy and Transport

The Deputy Presiding Officer

The next portfolio is net zero, energy and transport. If a member wishes to ask a supplementary question, they should press their request-to-speak button or enter the letter R in the chat function during the relevant question.

Again, I appeal for succinct questions, with answers to match.

Question 1 has not been lodged.

Offshore Wind (Leasing Process)

Colin Smyth (Labour, South Scotland)

2. To ask the Scottish Government for what reason a maximum bidding price has been applied to commercial-scale ScotWind projects, but not to 100MW innovation projects looking to progress through the forthcoming innovation and targeted oil and gas leasing round. (S6O-01191)

Michael Matheson (Scottish National Party, Falkirk West)

Unlike ScotWind, innovation projects are likely to vary considerably in their design requirements, including sea-bed location. That presents significant challenges in setting an appropriate price cap. Therefore, Crown Estate Scotland has used an approach that allows the market to establish a fair price.

The ScotWind leasing round for large-scale commercial projects used a price cap to enable delivery of competitive projects that could maximise supply chain opportunities for Scotland, particularly in the deployment of emerging floating wind technologies.

Colin Smyth (Labour, South Scotland)

I am not sure that the cabinet secretary actually explained why that cap is not in place elsewhere. Does he not recognise that having one rule for the ScotWind round and a different one for innovation projects means that companies that are focused on using innovative technology and largely Scottish supply chains were at a disadvantage compared with the big companies that have the deepest pockets and which are leasing Scotland’s sea beds on the cheap and will, inevitably, be using existing technology and largely global supply chains? That is bad news for Scottish jobs and for innovation.

Michael Matheson (Scottish National Party, Falkirk West)

I am not sure whether Colin Smyth has entirely recognised the purpose of the innovation and targeted oil and gas—INTOG—process. The INTOG scheme is specifically designed to support innovation projects for decarbonisation of oil and gas installations. Those projects do not use the same spatial parameters that we have for the ScotWind programme. INTOG is a very different type of programme that is targeted at decarbonisation of oil and gas installations and at helping to support innovation in achieving that.

In addition, many of the INTOG programmes will not connect to the grid, but will serve directly only installations that they are decarbonising and other projects, as well.

Alongside that, I note that the leasing round was the first of its type in the world. As I set out, Crown Estate Scotland, in trying to establish a clear commercial narrative and cost around INTOG, has used an approach that it believes

Maurice Golden (Conservative, North East Scotland)

Will the final decision on scoring criteria and weighting for INTOG leases for floating offshore wind projects be taken by Scottish ministers or by Crown Estate Scotland, and when will that decision be made?

Michael Matheson (Scottish National Party, Falkirk West)

The decision will be taken by Crown Estate Scotland.

Solar Energy Scotland (Report)

Clare Adamson (Scottish National Party, Motherwell and Wishaw)

3. To ask the Scottish Government what its response is to the Solar Energy Scotland report, “Scotland’s Fair Share: Solar’s role in achieving net-zero in Scotland”. (S6O-01192)

Michael Matheson (Scottish National Party, Falkirk West)

The Scottish Government recognises the importance of energy generation from solar photovoltaics in contributing to decarbonisation of Scotland’s energy supply and in helping us meet our targets for a net zero emissions society by 2045.

In support of that, the Scottish Government will this year work closely with Solar Energy Scotland representatives to support the development of a solar vision for Scotland. That work, done in consultation with the solar sector, will establish a vision for the future of solar energy to be included in the forthcoming energy strategy refresh and in the just transition plan.

Clare Adamson (Scottish National Party, Motherwell and Wishaw)

The United Kingdom Government’s energy strategy presents a false choice between nuclear energy proliferation and continued reliance on Russian gas. New nuclear power will take 10 to 15 years to get up and running, at exorbitant costs, but simply cannot address the current energy and cost of living crises. Does the cabinet secretary agree that we should be fully focused on increasing our renewable energy outputs, including solar energy, which can be done in a fraction of the time and at a fraction of the cost?

Michael Matheson (Scottish National Party, Falkirk West)

There is absolutely no doubt that anybody who knows the nuclear industry knows that it will not play a part in helping to tackle the current cost of living crisis and the very high costs that are associated with energy production at present. In fact, there is a risk that nuclear electricity production will actually push up domestic energy costs even further.

If we want to reduce energy costs, it is important that we do so in a way that is targeted at helping to reduce people’s energy demand through insulation programmes and the move to decarbonised energy systems, while speeding up decarbonisation of our energy sector overall. That is why moving much further towards renewables, pumped-storage hydro and battery storage are critical to ensuring that we reduce the costs of energy overall and that we do so in a speedy way—a way that nuclear energy would not be able to provide.

I note that Jesse Norman, who is a former energy minister, pointed out just this week that the UK Government’s proposal to build a new nuclear power station year is highly unlikely to happen any time in the next decade.

Willie Rennie (Liberal Democrat, North East Fife)

Will the work that the cabinet secretary talked about doing with the solar sector cover planning and taxation? On planning and taxation grounds, the UK Government has lifted the limit to beyond 50kW for roof solar schemes. Scotland imposes higher taxes and greater planning restrictions. Is not it time to stop putting barriers in the way of businesses that want to do their bit for the climate?

Michael Matheson (Scottish National Party, Falkirk West)

I am not entirely sure what Willie Rennie’s point was in relation to tax. If he is referring to VAT, he will be aware that it is reserved to the UK Government.

Planning and how to make greater use of solar power will, of course, be among the issues that we consider as we take forward the work. I am sure that the member will want to be generous in recognising that Scotland has been leading the way in pushing forward with renewable energy. He can be assured that the new energy strategy will reflect that, and that solar will be an important part of it.

Marine Environment (Protection)

Rhoda Grant (Labour, Highlands and Islands)

4. To ask the Scottish Government what steps it is taking to ensure that the marine environment is protected. (S6O-01193)

Màiri McAllan (Scottish National Party, Clydesdale)

The Scottish Government’s vision is for clean, healthy, safe, productive and biologically diverse seas that are managed to meet the long-term needs of nature and people. Our programme for government sets out measures to continue protecting and enhancing our marine environment, including via species protection.

Already, 37 per cent of our seas are designated as marine protected areas, which exceeds the global target of 30 per cent by 2030 that is currently being negotiated. We will implement the remaining protective management measures for sites by 2024 and will, in line with the European Union’s ambition, introduce highly protected marine areas covering at least 10 per cent of our seas by 2026, which is also ahead of global commitments.

Rhoda Grant (Labour, Highlands and Islands)

Next week, all marine protection vessels will be tied up because mariners are on strike because of an imposed pay deal. Marine Scotland has refused to negotiate and has thrown striking workers off the vessels, leaving them homeless. That is the Scottish Government using P&O tactics against its own workers. In the meantime, our waters are not being policed and our protected areas are unprotected. What steps is the minister taking to protect our valuable fishing grounds and protected areas during the strike action? What steps is she taking to resolve the situation and negotiate with the rightly aggrieved workers?

Màiri McAllan (Scottish National Party, Clydesdale)

It is inaccurate to draw any comparison whatsoever between the Scottish Government and Marine Scotland’s activities and P&O’s activities. A number of constructive meetings have taken place between Marine Scotland and Unite, and various options have been explored in trying to resolve the dispute, including proposed commitments on future reforms to pay structures, which would address a number of Unite members’ concerns.

Although an agreed way forward has not been reached to date, the Scottish Government remains committed to collective bargaining and further dialogue in order to resolve the matters.

Renewables (2030 Target)

Michelle Thomson (Scottish National Party, Falkirk East)

5. To ask the Scottish Government what its position is on whether its target of generating 50 per cent of energy use from renewables by 2030 is sufficiently ambitious in light of new opportunities arising for Scotland. (S6O-01194)

Michael Matheson (Scottish National Party, Falkirk West)

The 2017 Scottish energy strategy set out a target for generating and supplying the equivalent of 50 per cent of energy for heat, transport and electricity in Scotland from renewable sources. A review of the 2017 targets will be considered as part of the forthcoming energy strategy refresh and just transition plan, which will be published for consultation in the autumn.

The strategy will also take into account the role of alternative fuels such as hydrogen as means of providing low-cost energy security and export opportunities for Scotland, given the current global situation.

Michelle Thomson (Scottish National Party, Falkirk East)

The current capacity of renewables is just over 12GW, and there are plans for a further 15GW. In addition, the ScotWind leasing round is expected to deliver 25GW. That will represent a more than fourfold increase in Scottish renewable energy production and will meet all Scotland’s current energy demands. That will be far in excess of the 2030 target. Does the cabinet secretary agree that that represents a huge opportunity for Scotland? Will he ensure that every chance is taken to help everyone in Scotland to understand that that is a bounty that will serve us and all our futures, in perpetuity?

Michael Matheson (Scottish National Party, Falkirk West)

I agree that we are in a strong and robust position to move forward with development of our renewable energy sector in Scotland. That has been the case over the past decade, and I have absolutely no doubt that it will continue to be the case in the years ahead.

As Michelle Thomson will be aware, we have the ambition of tripling our capacity for renewable energy generation by 2030. We want to do everything that we can in order to achieve that and to remove barriers, including transmission charges, that continue to limit the capacity and development of some areas in the renewable energy sector.

I assure the member that we want to maximise what we are doing not only for domestic purposes but to capitalise on the growing international desire for expansion in areas such as renewable hydrogen. Countries like Scotland can play a major part in supporting the decarbonisation of major European economies that consider that green hydrogen will be a major source of their energy use in the decades ahead. Scotland can play a big part by supplying those markets, which will generate economic and social benefits here in Scotland.

Liam Kerr (Conservative, North East Scotland)

Last week, I asked a junior minister from what source Scotland will get the 38 per cent of firm power—not power that is dependent on the weather or batteries—that the Climate Change Committee says will be required, but their script did not even begin to answer the question. Will the cabinet secretary provide a straight answer? From what source will the firm power come?

Michael Matheson (Scottish National Party, Falkirk West)

Everyone recognises the importance of firm, or dispatchable, power in our network. The Conservatives think that nuclear power is the best approach, but nuclear power generation is one of the most inflexible forms of energy generation. We will ensure that we have dispatchable energy through hydro pumped storage and battery storage; those are the main ways in which it can be delivered.

Liam Kerr should recognise that one of the inhibitors to Scotland’s realising some of that potential is that the United Kingdom Government, which controls access to the market, does not have a market mechanism to allow the development and expansion of hydro-pumped storage in Scotland. Maximising that storage would deliver the dispatchable or firm source that we require, and it would avoid the unnecessary costs, including environmental costs, of nuclear power.

Railway Stations (Accessibility)

Marie McNair (Scottish National Party, Clydebank and Milngavie)

6. To ask the Scottish Government what it is doing to make railway stations accessible for disabled people. (S6O-01195)

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

Even though accessibility remains a reserved matter, Transport Scotland continues to seek to improve accessibility as part of wider rail enhancements and the decarbonisation programme. New stations at Inverness airport and at Hairmyres, on the East Kilbride route, and the two on the Leven line, will be fully accessible. The Scottish Government will also provide funding for step-free access at Aviemore, Pitlochry, Nairn and Kingussie stations. Additionally, six stations secured funding from the access for all programme, including Anniesland, Croy, Dumfries, Johnstone, Port Glasgow and Uddingston.

Marie McNair (Scottish National Party, Clydebank and Milngavie)

I welcome the Scottish Government’s position. It is important that train stations are safe and fully accessible to all. A number of constituents have contacted me regarding difficulty in accessing Clydebank train station. Does the minister support my position that accessibility arrangements need to be renewed and improvements made that help meet the needs of disabled people who use the station?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

Absolutely. We need greater accessibility at our rail stations across the country. To that end, I was pleased to meet Disability Equality Scotland this morning to discuss some of the challenges that its members face in relation to the rail network.

In the second strategic transport projects review, there is a recommendation relating to

“Infrastructure to provide access for all at rail stations”,

which involves

“a review of station accessibility across Scotland to identify barriers and improve access for all to the rail network.”

It is worth reiterating that rail accessibility currently remains a matter that is reserved to the United Kingdom Government. In the light of that review and in order to progress that recommendation, my officials in Transport Scotland have been working closely with the Department for Transport on an accessibility audit of all Great Britain’s rail stations to ensure that maximum benefit is derived from all available funding.

Accessibility improvements for Clydebank station will form part of the considerations of the recommendation that is set out in STPR2. I hope that that reassures the member on that point.

Graham Simpson (Conservative, Central Scotland)

That was a very encouraging answer from the minister. I was going to ask her whether she would commit to conducting such an audit, and she has. What is the timescale for that? Having that information would be extremely useful for disabled people across Scotland.

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I do not have a note in front of me of the timescales that are involved, but I am happy to write to the member with more detail.

Road Infrastructure (North East Scotland)

Douglas Lumsden (Conservative, North East Scotland)

7. To ask the Scottish Government whether it will provide an update on future road infrastructure projects in the north-east. (S6O-01196)

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

The Scottish Government remains committed to improving infrastructure in the north-east, as is evidenced by the recent opening of improvements at Haudagain on 16 May. We remain committed to making improvements to the A96 with a transparent, evidence-based review of the corridor that is under way, which will report by the end of 2022. Additionally, we continue to progress proposed improvements at Laurencekirk junction through the statutory process.

For the longer term, the second strategic transport projects review sets out recommendations for strategic roads, which focus on safety, climate change adaptation and resilience.

Douglas Lumsden (Conservative, North East Scotland)

Earlier this year, the Scottish Government released its national transport strategy and, as my colleague Liam Kerr identified, the document failed to mention the notorious Toll of Birness junction. Upgrading that junction and the wider A90 will not only make a huge difference to the lives of those people who live and work in the north-east, and serve as a catalyst for economic growth, but come with the potential of dramatically reducing the number of horrific accidents and saving lives.

Traffic assessments that were done nearly five years ago show that the junction will be almost unusable in the future. With that in mind, will the minister commit to upgrading the junction and bring much needed safety to commuters in Aberdeenshire?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

Of course, consideration of safety improvements on the A90 at the Toll of Birness and Cortes junctions can now be undertaken as part of the wider STPR2 road safety recommendation, which is recommendation 30. That recommendation focuses on

“trunk road and motorway safety improvements”

to progress towards vision zero. Where junction upgrades are needed to support that development in line with Scottish planning policy, developers need to mitigate their impact, which might include upgrading junctions where a safety issue arises as a result of that development.

I recognise the member’s interest in relation to that issue particularly, and I am more than happy to write to him with more detail in relation to the time that has elapsed since that issue was first raised, and more broadly in relation to the recommendations that sit within STPR2.

The Deputy Presiding Officer

Bearing in mind that the question is on road infrastructure projects in the north-east, I call a supplementary from Paul McLennan.

Paul McLennan (Scottish National Party, East Lothian)

Cars will continue to have a role to play in the travel arrangements of people in our rural communities for some time. Given that we know the role that cars play in our transport-related emissions, and given that the world is on course to exceed the 1.5°C of global warming threshold, does the minister agree that decisions that regard the building of our future roads and infrastructure projects throughout Scotland must be considered in terms of their potential environmental impact?

The Deputy Presiding Officer

That question was not really to do with road infrastructure projects in the north-east, but if there is anything you could offer by way of response, I invite you to do so, minister.

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

We are committed to zero emissions from transport and to decarbonising all modes of travel, including by road and in the north-east of Scotland. Our commitment to achieving net zero in transport is clearly set out in the vision and the outcomes of our national transport strategy.

Railway Stations (Safety)

Fulton MacGregor (Scottish National Party, Coatbridge and Chryston)

8. To ask the Scottish Government what steps it is taking to improve safety at train stations. (S6O-01197)

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

Keeping passengers and staff safe on Scotland’s railways is our absolute priority. ScotRail has one of the largest closed-circuit television networks in the United Kingdom, with more than 6,000 cameras monitoring more than 350 stations. There are also help points on every platform that allow passengers and staff to connect to a customer information adviser, 24 hours a day.

The

team speaks through the intercom and uses the CCTV cameras to view passengers and staff in the station. The team is trained to report any antisocial and threatening behaviour to British Transport Police, which is responsible for monitoring safety at our stations.

Fulton MacGregor (Scottish National Party, Coatbridge and Chryston)

In recent months, there have been a number of deeply distressing and serious incidents at train stations in my constituency. In some of those incidents, people have lost their lives, which can be very upsetting for the community as a whole. Does the minister share my view that we need to do everything possible to assure the public that they can travel by train with confidence and enjoy the benefits of using Scotland’s environmentally friendly and publicly owned trains?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I whole-heartedly agree that passengers and staff should all feel safe to travel on the rail network without fear of antisocial behaviour. However, I must state that the railway in Scotland overall is a safe environment to travel in, notwithstanding some of Mr MacGregor’s points this afternoon. This was one of several topics that I raised with the chief constable of British Transport Police and the chief superintendent of British Transport Police Scotland when I met them recently. BTP has confirmed that patrols are being redirected and officers are being deployed to known hotspots to prevent antisocial behaviour and other associated crimes. It is also piloting joint patrols with ScotRail Trains to provide a travel safe team in those areas.

It is hoped that an extension of the travel safe teams’ abilities will be further provided and that that will increase the number available in terms of support.

The Deputy Presiding Officer

That concludes portfolio questions. There will be a slight pause before we move to the next item of business and I encourage members who have just come into the chamber not to begin chatting as soon as they have done so.

Urgent Question

Annabelle Ewing (Scottish National Party, Cowdenbeath)

The next item of business is an urgent question.

ScotRail Timetable (Hampden)

Graham Simpson (Conservative, Central Scotland)

To ask the Scottish Government what provisions it is making for Scotland fans to get home after tonight’s Nations League match at Hampden against Armenia, in light of the reported announcement by ScotRail that they should leave early if they want to catch a train.

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

ScotRail Trains is responsible for operational planning and will always seek to provide the best service possible. However, it has advised that, on this occasion, it has not been possible to provide more than the reduced timetable. I know that that will be deeply frustrating for fans who are travelling to the Armenia match tonight.

As the member knows, rail services, and especially any additional services to support special events, rely on rest day working, which is voluntary, and relying on drivers working on their rest days is not sustainable, either for them or for our rail service.

The train drivers union, the Associated Society of Locomotive Engineers and Firemen—ASLEF—is involved in a dispute with ScotRail in relation to pay. That is not formal industrial action, but it is true that drivers are choosing not to work on their rest days. That is their right, and I respect that. However, the reality is that that has made timetabling for tonight’s match incredibly challenging for ScotRail, and it has not been able to run an enhanced service, as happened with the match last week.

As members will be aware, ASLEF opted not to present ScotRail’s offer to its members after the two parties met last week. ScotRail has already indicated its disappointment and frustration at the situation. I understand that the parties are due to meet again tomorrow, and I will await an update on that. Clearly, we would all like to see the pay negotiations settled so that we can get back to providing a full rail service for passengers everywhere.

Graham Simpson (Conservative, Central Scotland)

So, the answer is that no provisions have been made for fans to get home.

Football fans have been used to leaving matches early to beat the rush. In this case, they have been told to leave early because there is no rush—there are no trains. Does the minister agree that the situation is not acceptable? Would she like to apologise to the tartan army?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

The temporary timetable that ScotRail has implemented gives passengers a more stable and reliable service. We know that people want certainty when they travel. ScotRail has looked at how best to provide as much certainty as it can during what has been, as we know, a very challenging period for passengers.

Traditionally, ScotRail carries far more supporters to Hampden games than it carries back from games. Last week, approximately 7,000 fans travelled to the Ukraine match by train, but only 2,500 travelled back by train. In general, fans prefer to walk back to the city centre. It is also worth saying that the crowd at tonight’s game is expected to be far smaller than the crowd for the Ukraine game. In addition, it is worth saying that the six unadvertised buses that were held on standby at Central station to support any onward travel issues after the Ukraine match last week were not used.

ScotRail has advised that there is not sufficient bus capacity available to support transport of the crowd from Hampden to Glasgow that a high-capacity rail service would accommodate. Replacement buses are procured to provide a substitute in the event of planned or unplanned disruption, in order to leave no gaps in the reduced timetable. However, to do so across the network at the current time would require the provision of an enormous fleet of buses at significant expense. If last week’s situation, in which 2,500 supporters returned to Glasgow, was to be replicated, a fleet of some 50 buses would be required, which would create its own transport issues in and around Hampden.

Given the wider industrial dispute that was announced yesterday, it is clear that rail users right across the United Kingdom will face serious disruption that is not of the Scottish Government’s making. The answer to the present situation is to resolve the dispute. To that end, I look forward to discussing the matter with ScotRail, after it has met ASLEF tomorrow. We all want the dispute to be resolved, not just for the passengers who will travel to the football match today, but for everyone in Scotland who uses our rail service.

Graham Simpson (Conservative, Central Scotland)

My word—the minister’s answer to football fans who go to tonight’s game is, “Walk to the city centre.” There will be no alternative, unless they have taken their own car.

I am encouraged to hear that there will be talks tomorrow. I know that the minister has not bothered to dirty her hands by getting involved in the talks so far, but can she tell us how confident she is that the situation will be resolved tomorrow and that we will not have a summer of chaos?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

Setting aside the member’s use of language, I remind him that I do not go into the negotiating room. It is appropriate for ScotRail, as the employer, to negotiate directly with the trade union. That is how we resolve industrial disputes.

I agree with the member that it is important that we achieve a resolution to the on-going dispute. Later today, I will seek an update from ScotRail on the challenges that are currently being faced. It is also important to reflect on the use of rest-day working. That is not a new practice that started on 1 April; it has been a feature of our railways for many years. Some in our railways may view it as an outdated concept. I would like to have conversations on such matters with our trade union partners.

I invite Mr Simpson to review his party’s engagement with the trade unions. Last week, his colleague Grant Shapps said that the UK Government was drawing up legislation to ban trade unions from going on strike. As the general secretary of the Trades Union Congress has noted, it appears that the Conservatives are looking to pick a fight with the rail unions.

The Scottish Government works with our trade union partners. We understand fair work principles and we advocate for our trade unions. On that note, I am very much looking forward to working with our railway unions to discuss our national conversation on public ownership of Scotland’s railways and how they can play a part in moving forward that vision.

The Deputy Presiding Officer

I will take some supplementaries, starting with Neil Bibby.

Neil Bibby (Labour, West Scotland)

The Scottish Government has given Abellio a contract to provide rail replacement buses, but it appears that, yet again, there will be no rail replacement bus services to get fans home from Hampden tonight.

Yesterday, the minister refused to say how much Abellio is being paid. What is Abellio being paid to do? The minister has said that there is a shortage of buses to provide a rail replacement bus service, but ScotRail is not providing any buses to help passengers with the disruption. Is it seriously the Government’s position that there are no buses anywhere in Scotland that could be used to provide a rail replacement bus service for fans returning from Hampden tonight?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

The matter was raised yesterday at topical question time, in relation to the four Abellio contracts that have continued over to allow for consistency in moving ScotRail into public ownership from 1 April.

ScotRail has confirmed that securing rail replacement buses has proved to be significantly more challenging than it was prior to the pandemic. A fall in the number of the available bus and taxi drivers, coinciding with greater demand as the economy has opened up after Covid, has meant that there is less availability across the country.

Our bus operators face a number of staffing pressures, not least Covid and, of course, Brexit, which Mr Bibby’s party now seems to support. We are already seeing bus operators having to make some really challenging decisions around where they are able to provide services.

I have asked ScotRail to consider at all times whether it is able to provide rail replacement services. On this occasion, it tells me that that is not the case.

Bill Kidd (Scottish National Party, Glasgow Anniesland)

As we all know, ScotRail’s temporary revised timetable is only one facet of industrial disputes that are taking place throughout the UK. Although the Scottish Government wants all parties to get round the table and negotiate a fair and affordable pay deal, it would seem that the Tories would rather use the dispute between the National Union of Rail, Maritime and Transport Workers and UK Network Rail to criminalise industrial action.

That dispute will have a detrimental impact on events such as football matches, as we know. What discussions has the minister had or will she have with Grant Shapps regarding the UK Government’s intended course of action for improving industrial relations in the rail sector?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

As I reiterated today, unlike the Tories at Westminster, this Government supports fair work and we support the principle and practice of trade unions and the right of people to join a trade union. I am not surprised to hear the Conservatives ramping up their anti-union rhetoric, but, t

o be clear, that has no support from this Government and it could not be further from our approach of including and involving trade unions in our work, including the work on how we take forward Scotland’s railways.

I continue to engage with ScotRail, which, later this week, is engaging with ASLEF and the RMT to get back round the table and resolve the current dispute. Parties are working together to reach a resolution, whereas the UK Government appears to want to make industrial action illegal.

I have already written to Grant Shapps to make clear this Government’s view on the approach to the Network Rail dispute. I have also written to Network Rail to express this Government’s concerns surrounding any potential redundancies arising from its proposals, which of course we would not support. That was welcomed by the RMT.

I reiterate that I am appalled that Network Rail employees have had no pay rise for the past two years. That is not acceptable, and nor does it make any economic sense for Network Rail to seek to continue with that. We can only conclude that that is being done for political or ideological purposes. Based on what was reported last weekend, that is now clearly bearing fruit.

Liam Kerr (Conservative, North East Scotland)

In response to my questioning in committee, the minister told me that the key—indeed, the sole—change from nationalisation was that she would be accountable. Does the minister recognise the concerns of people who might think that, in refusing to step into the situation, she is abdicating that accountability?

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

I say to the member that I am accountable. I am here today, answering an urgent question. I was here yesterday, answering a topical question on rail. I was here the week before, answering a question on rail, and the week before that. He has absolute accountability from me—[

Interruption

.]

The Deputy Presiding Officer

Minister.

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

—as transport minister—[

Interruption

.]

The Deputy Presiding Officer

Minister! Please resume your seat.

I would like a bit of calm from all parts of the chamber, so that we can hear the answer to the question that the member asked. Minister, please continue.

Jenny Gilruth (Scottish National Party, Mid Fife and Glenrothes)

As I outlined in response to Mr Simpson, it would not be appropriate for me, as minister, to be in the negotiating room. To my mind, no ministers are ever in the negotiating room. It is appropriate in this instance for ScotRail to be in the negotiating room, as the employer, with our trade union partners. I look forward to their reaching a resolution, so that we can restore ScotRail’s full timetable, for the benefit of passengers and staff alike.

The Deputy Presiding Officer

That concludes the urgent question. Before we move to the next item of business, we will have a short pause to allow front-bench teams to take their positions.

Economic Priorities

Annabelle Ewing (Scottish National Party, Cowdenbeath)

The next item of business is a debate on motion S6M-04815, in the name of Liz Smith, on economic priorities.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

There are really two reasons behind the Scottish Conservatives’ request for this debate. First, the 30-minute statement last week, with less than an hour prior to that in which to digest a significant amount of economic analysis, did not provide satisfactory time for parliamentary scrutiny. Secondly, we have the first projected longer-term outline of the Scottish Government’s fiscal policy since 2011—we welcome that timeline—so we believe that extended scrutiny is essential, particularly at a time of challenging economic circumstances.

I will begin by stating some key facts. The Scottish Fiscal Commission’s December 2021 statistics showed that the Scottish Government’s overall budget for 2022-23 would no longer receive on-going Covid funding as the pandemic eased. What is also correct—the cabinet secretary should know by now that all the experts’ statistics, including those from the Scottish Parliament information centre and the Institute for Fiscal Studies, confirm this—is that the block grant that was received from Westminster was the largest in real terms in the history of devolution and is set to rise in real terms during this parliamentary session; that the Scottish Government received about £15 billion of additional Covid spend for the previous two financial years; and that the Scottish Government has had £7 billion more to spend than it expected four years ago.

Here are some more facts. Income tax revenues are growing more slowly than the income tax block grant adjustment. The Institute for Fiscal Studies has predicted that income tax revenues will be about £428 million less than would have been the case if income tax had remained in the United Kingdom tax structure. From 2024-25, the UK income tax rate will reduce to 19 per cent, but there are no signs of the Scottish Government making the same commitment yet—I will come back to that. Social security spend in Scotland is set to rise from 10 to 14 per cent of the resource budget. The size of Scotland’s labour force is reducing, and the labour market participation rate is falling.

Then there is the huge black hole in the public finances, which, yet again, the finance secretary told the Finance and Public Administration Committee does not exist—[

Interruption

.] On top of those facts is the backdrop to the current economic situation. As Dame Susan Rice spelled out last week, the war in Ukraine, the significant increase in global energy prices and difficulties in international supply chains—most especially those that relate to China—are creating serious challenges for every economy in the world.

It is perfectly true that there is greater uncertainty in the economy than there was in December 2021, when forecasts were published. What is also correct—I repeat a view that I have expressed in several debates in the chamber—is that aspects of the current fiscal framework exacerbate the uncertainty. It does not help that there are considerable time lags and often divergence between the forecasts of the SFC and those of the Office for Budget Responsibility, and it does not help that the framework is not inflation adjusted—two aspects that I hope will be resolved when the current negotiations on a new fiscal framework are concluded.

The cabinet secretary cannot blame the fiscal framework on Westminster. It was her predecessor, John Swinney, as well as UK Government ministers, who signed up to it in 2016.

The long and short of it, confirmed by all economic forecasters, is that the Scottish Government is spending too much in comparison with what it is raising. If the cabinet secretary does not like the term “black hole”, let me try the term “shortfall”. I remind her that, last week, David Phillips of the Institute for Fiscal Studies said:

“A series of expensive spending commitments on top of underlying spending pressures mean that the Scottish Government faces a multi-billion budget shortfall over the next four years”.

We know that, as a result of all that, the cabinet secretary has decided to make savage cuts to public sector jobs. The

New Statesman

offered the view that that will include many jobs in Government agencies and quangos—Transport Scotland, Marine Scotland, Food Standards Scotland and the Scottish Environment Protection Agency were all mentioned in its article. We will see what happens in that regard.

I am sure that the public will find it difficult to understand why on earth substantial, real-terms cuts are to be made to our police, who are on the front line of keeping our communities safe; local government services; trade and enterprise; tourism; and our universities, which the cabinet secretary admitted yesterday are integral to the realisation of the national economic transformation strategy, and which play such a vital role when it comes to research and development and innovation.

That is the same public who will see the profligacy of the Scottish National Party Government in wasting vast sums of public money on ferries that do not sail, Burntisland Fabrications, Prestwick airport and the malicious Rangers Football Club prosecution—the list goes on. Of course, there is also the £20 million for preparing for a second referendum.

Stuart McMillan (Scottish National Party, Greenock and Inverclyde)

Yet again, the Conservative Party is talking about the ferries being a waste of money. Is Liz Smith saying to the population of Inverclyde and the workforce at Ferguson Marine that they are a waste of money?

Elizabeth Smith (Conservative, Mid Scotland and Fife)

I cannot believe that question—the extent of the public money that is being wasted by this SNP Government is absolutely patently obvious. It is increasing week by week and is taking away a lot of money that could and should have been used to finance the public books.

I remind members what Audit Scotland has said about parliamentary scrutiny in relation to the spending of public money—this might answer another part of the question that I have just been asked. The Auditor General said:

“The Scottish Government now needs to be more proactive in showing where and how this money was spent, and show a clearer line from budgets to funding announcements to actual spending. This will support scrutiny and transparency”.

That, cabinet secretary, is exactly the same conclusion as the Finance and Public Administration Committee came to.

I turn to the tax issue that is central to the problems that the Scottish Government faces in relation to the disincentives of tax policy and the weaknesses of the tax take. The cabinet secretary has said that Scotland has a progressive income tax policy, but she should heed the warnings of the Scottish Fiscal Commission, which says that, in the next five years, Kate Forbes will have 700,000 middle earners in a higher tax bracket.

Neither should the cabinet secretary forget that, in December, the Scottish Fiscal Commission dismissed her claim that the majority of Scots would be paying less tax. That is simply not borne out by the evidence. The disincentives that come from that are likely to be significant and, most important, Scotland’s divergence from the UK income tax rate threatens to damage Scotland’s competitiveness, which is why we want to see a return to parity as soon as resources allow.

John Mason (Scottish National Party, Glasgow Shettleston)

Does the member accept that, through the different tax policies, we raised £240 million extra for 2018-19, which the latest figures are for? If we did not have that money, there would be further cuts to police and other things.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Mr Mason sits on the same committee as I do, which has been scrutinising Government finances, and he will know exactly what the projections are about the downturn in the tax take that we are suffering from. That is the problem that I refer to. The tax revenue situation is most worrying of all, because it reflects not only the serious challenges about the primary source of Government spending but the serious imbalances in the Scottish economy. Those imbalances—most especially those that relate to the labour force—mean that it is highly likely that we will continue to lag behind the UK on several key economic indicators. Higher tax rates are not delivering the higher tax revenues that we need, which is a serious concern.

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The member just made a comment that is contradicted by David Phillips from the Institute for Fiscal Studies, who explicitly said that the

“tax rises almost certainly have raised revenue”.

Who is right—the member or David Phillips?

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Of course, tax revenues are up in that sense, but they are not up to the extent that the Scottish Government requires for its spending. There is a huge divergence. This morning, at the Scottish Fiscal Commission breakfast, a graph showed that to be patently obvious. That is a serious concern.

The context of that is set out by the Scottish Government’s approach to the north-east and the oil and gas sectors, which encompass a large number of well-paid and highly skilled workers whose tax contributions to the Scottish economy are extremely important. That has become a problem, because we know that the SNP wants to rip the heart out of those industries.

The tax revenue issues were set out in stark terms by the Finance and Public Administration Committee. I remind the cabinet secretary that its unanimous conclusion was:

“The Committee believes that the outlook for Scotland’s economic performance and the downward pressure on the Scottish Budget, requires greater emphasis on prevention and reform.”

The committee wanted the Scottish Government to streamline and make much more coherent its policy strategies. Paragraph 97 of its report said:

“We consider that evidence showing that Scotland is lagging behind almost all other areas of the rest of the UK in key indicators of economic performance is deeply worrying.”

I have mentioned two changes that we would like the Scottish Government to deliver. They are a return to parity on income tax rates, so that Scotland is not disadvantaged, and a finance bill that would enhance the scrutiny of public spending decisions. However, the crucial element in all this is policies to enhance economic growth, even if the SNP’s partners, the Greens, do not agree with that.

Our Scottish Future was absolutely blunt in its analysis last week. It said that

“Scotland’s long-term failure to increase its growth rates relative to the UK”

is

“the elephant in the room.”

Our Scottish Future told the Scottish Government to stop

“throwing good money after bad or non-productive”

projects, and it cited the illogical decision to cut spending on university research as one example. We agree with that, just as we agree that the Government should ensure that there is a much simpler and more easily understood pathway through the enterprise bodies and grants that it can award. Just about everybody in business wants that change as quickly as possible, because they are keen to get on with boosting innovation and productivity without red tape, form filling and complex planning and procurement processes getting in their way. It is essential for business to feel good about itself and its future if Scotland is to achieve the growth rates that we need.

In recent weeks, several key business leaders have said that the national economic transformation strategy and the Scottish National Investment Bank do not have anything like the clarity and rigour that we need to deliver growth. Businesses also want to see Scotland’s Governments working together—not embroiled in constant bickering and constitutional rivalry, which divert attention away from the important focus. That is another unanimous conclusion of the Finance and Public Administration Committee.

Scotland has immense talent in every corner of the country. We need to mobilise that talent in every way that we can, and we need policies that support that talent, incentivise investment and support our businesses and public services. We need a Scottish Government that is wholly committed to efficiency and transparency in public finances. We do not need one that is constantly peddling grudge and grievance at every turn and not looking after our finances properly.

I move,

That the Parliament is deeply concerned by many of the trends published within the recent analysis of the Scottish economy undertaken by the Scottish Fiscal Commission; is concerned, in particular, by the revised downward growth estimates and decline in real earnings, and that the Scottish Government has imposed higher tax rates on Scotland without increasing revenues, compared with the block grant adjustment, due to the ongoing issues relating to weaker productivity and inflexibilities within the Scottish labour market; is further concerned by the real-terms cuts of more than £1 billion announced by the Scottish Government, which will affect local government, the police and higher education, among key services; calls on the Scottish Government to commit to ensuring that no one in Scotland pays more income tax compared with people in the rest of the UK, when finances allow, ensuring that policies to deliver long-term growth, including collaborative projects with the UK Government such as city deals, are a priority within Scottish Government spending plans; calls for a finance bill mechanism to be introduced to evaluate the effectiveness of public spending, and further calls for plans for a second independence referendum to be taken off the table.

The Deputy Presiding Officer

Before calling the next speaker, I remind all members who wish to speak in the debate to ensure that they have pressed their request-to-speak button. I call the Cabinet Secretary for Finance and the Economy, Kate Forbes, to speak for up to nine minutes.

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

This debate is really about why and how Scotland cannot afford to remain under UK Tory rule.

It is more than a little ironic that the Conservatives have initiated today’s debate on the economy when their Westminster leaders are presiding over the sharpest fall in living standards and the fastest rise in inflation for a generation. Right now, that party is the very symbol of economic mismanagement.

The true cost of Tory economic mismanagement has been laid bare by external commentators. Research by the London School of Economics and Political Science’s Centre for Economic Performance revealed that Tory Brexit has caused food prices to rise by 6 per cent, which has deepened the cost of living crisis for households across the UK.

Today, the Organisation for Economic Co-operation and Development warned that next year the UK will have the worst economic growth of any G20 country, bar Russia.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

I am grateful to the cabinet secretary for taking my intervention. What does the cabinet secretary feel about the finance committee’s conclusion:

“We consider that evidence showing that Scotland is lagging behind almost all other areas of the rest of the UK in key indicators of economic performance is deeply worrying.”

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Which Government was responsible for faster gross domestic product growth in Scotland in March, when there was a fall in GDP across the rest of the UK? I will come on to speak about a number of other metrics.

All that I have just detailed is happening under the leadership of the very party that lodged today’s motion. As I set out in the chamber last week, although inflation is, quite clearly, also impacting on other countries, it is not impacting on them equally. The UK currently has, under the Tory Government, the highest inflation rate of any G7 country and a rate that is almost twice the rate in France.

Under the current devolution settlement, only the UK Government has the macroeconomic levers to fully address the cost of living crisis, but it has failed spectacularly to manage our economy in a way that works for businesses and households. Poverty is rising, costs are rising, the energy price cap is rising, living standards are falling, growth rates are dropping and competitiveness is sliding, under the Conservatives.

Daniel Johnson (Labour, Edinburgh Southern)

I agree with much of what the cabinet secretary has said. The Conservatives are doing an absolutely appalling job of running the economy, but does that not make the case for why we should be doing better? Although we might not have all the levers that the cabinet secretary wants, we do have levers, which does not explain why wage growth is underperforming in Scotland in comparison to the UK average. Can she explain that?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

I will come on to that, but I think that the context is important.

I recently wrote to the Chancellor of the Exchequer with a comprehensive funding package that would fully address the unprecedented rise in the cost of living. Instead of following that approach and using the fiscal headroom that was available to him to support people and businesses now, the piecemeal package that he announced makes it highly likely that more support will be needed later, when energy prices rise significantly in the autumn. In other words, while right now people sit in cold houses and turn to food banks, the chancellor is sitting on a substantial election war chest. In contrast—this relates to Daniel Johnson’s question—we are doing all that we can in response, and our amendment to the motion reflects the priorities that we have for Scotland’s economy and our public finances.

Our prudent stewardship of our finances and our careful—[

Interruption

.] That and our careful and ambitious management of the economy have resulted in Ernst & Young Global Ltd’s 2021 “Continued resilience: EY’s Attractiveness Survey Scotland” finding that Scotland has been the top UK destination for foreign direct investment outside London for the past seven years. Scotland’s GDP grew 0.3 per cent in March 2022, compared to a fall of 0.1 per cent in GDP in the UK as a whole. Estimates for January show that Scotland’s unemployment rate fell to 3.2 per cent in the first quarter of this year, which is a joint record low and is below the UK rate of 3.7 per cent. Scotland has a positive trade balance in goods; in 2021 it exported goods that were worth £1 billion more than the goods that it imported.

Willie Rennie (Liberal Democrat, North East Fife)

If the cabinet secretary is willing to take credit for those selective statistics, is she prepared to accept responsibility for Scotland’s overall economic performance, which lags behind the rest of the United Kingdom’s performance? Does she accept any responsibility for that?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

The irony of that question is that, although we have set out our approach to economic growth over the next 10 years and have recognised the work that needs to be done in terms of productivity, new markets and entrepreneurship, there is no way around the fact that the macroeconomic levers sit with the UK Government. If the Liberal Democrats want that situation to be different, I suggest that they join us in calling for those levers, because we have done what we have done with one hand tied behind our back.

This year alone, whatever the Conservatives say—I tend to believe independent commentators—Scotland’s budget is being reduced in real terms by 5.2 per cent.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Will the cabinet secretary take an intervention?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

I have taken quite a few interventions and I am probably running low on time.

If we look across the whole four-year period of the resource spending review, our real-terms funding is to grow by only 2 per cent, after accounting for devolution of social security benefits. The current fiscal settlement denies us even the most modest borrowing powers that most Governments across the world would have access to—powers that Scotland would have as an independent state.

If we need another reason why Scotland cannot afford to remain under UK Tory rule, researchers at the Glasgow Centre for Population Health found that

“Austerity is highly likely to be the most substantial causal contributor to the stalled mortality rates seen in Scotland and across the UK.”

Scottish people deserve better than that, and they also deserve informed and intelligent debate about the true nature of our financial outlook.

It is therefore disappointing to see that the Conservatives have, once again, claimed that

“the Scottish Government has imposed higher tax rates on Scotland without increasing revenues”.

That is factually inaccurate. It is contradicted—[

Interruption

.]. It is contradicted by the Institute for Fiscal Studies, which stated last week:

“We are not saying the tax rises have reduced revenue. The tax rises almost certainly have raised revenue.”

In the SFC’s December 2021 forecast publication—to which, I think, Liz Smith referred—the SFC noted that the Scottish Government’s decisions on income tax since 2017-18 would add about £552 million to the Scottish budget in 2022-23.

In the past six months, we have set out our annual budget, our strategy for economic transformation, two medium-term financial strategies and a three-year resource spending review—all against the backdrop of a pandemic and the biggest economic shock in over 100 years, the most significant cost of living crisis in a generation and the illegal Russian invasion of Ukraine, which is a humanitarian crisis that is affecting the global economy.

There can be no accusation that this Government is shying away from its responsibilities in managing our public finances and Scotland’s economy. It is managing them well. Despite the funding pressures and despite macroeconomic powers remaining with the UK Government, our resource spending review prioritises our limited resources on the Scottish Government’s long-term ambitions for Scotland.

Other parties in the chamber might have different priorities, but I strongly believe that the priorities that we have set out as part of the resource spending review are the priorities of the people of Scotland: tackling child poverty, transitioning to net zero, economic recovery and helping households with the cost of living crisis. It is our job, as a mature and fiscally responsible Government, to deliver those priorities, but Parliament needs to face up to the realities of where powers lie and the realities of a budget that gets cut by the UK Government.

I move amendment S6M-04815.3, to leave out from “is deeply” to end, and insert:

“endorses the priorities set out in the Scottish Government’s spending review of tackling child poverty, addressing the climate crisis, building a stronger economy and improving public services, while supporting those people struggling with the increased cost of living; notes that the overall Scottish Budget has fallen by 5.2% in real terms between 2021-22 and 2022-23 and that the Scottish Fiscal Commission has confirmed a further 1% real-terms reduction until 2025-26; agrees that current financial fiscal arrangements between the UK Government and the Scottish Government are deeply flawed; highlights the persistent dismal failures of leadership in the UK Government, with the UK currently having the highest inflation rate of any G7 country, compounded by Brexit increasing food prices; notes recent research from the Glasgow Centre for Population Health highlighting the brutal reality of a decade of austerity under the UK Government, and believes that, with full control over the economic and financial powers, the Scottish Government could take further action to build the economy that Scotland deserves.”

Paul Sweeney (Labour, Glasgow)

It is a pleasure to open the debate on behalf of the Labour Party. I thank the Scottish Conservatives for lodging the motion. The debate is long overdue and urgently needed following last week’s demoralising spending review, when the cabinet secretary heroically attempted to spin cuts that the Tories themselves would be proud of as fiscal prudence—

she has done so again today.

However, to put it bluntly, the economic outlook for the next five years is nothing but grim. We often hear warnings of economic uncertainty, and it seems as though not a day goes by without headlines about record fuel prices, record gas and electricity bills and record inflationary pressures.

Of course, those pressures all contribute to the economic forecasts that we are discussing, but the underlying vulnerabilities of the Scottish economy run far deeper than recent price spikes and the cost of living crisis, so I was dismayed to read the Government’s amendment to Liz Smith’s motion. It can only be described as showing the Government burying its head in the sand rather than addressing the failures that it has presided over.

The Scottish Government has done its usual by pointing the finger at Whitehall and highlighting the failings of the Tories—rightly, in this case, but it is also an attempt to distract from the myriad failures that it has presided over in Scotland.

I am afraid that the underlying indicators of economic performance are clear for everyone to see. The Scottish Fiscal Commission’s recent forecasts highlight the stark reality of the challenges that we all face, with productivity stalling, real wages falling and tax receipts significantly lower than previously predicted.

It is an economic forecast that many of us have been warning about for a long time, but the cabinet secretary has point-blank refused to accept it. Take productivity, for example. The SFC states that

“Productivity growth has stalled in Scotland since 2015.”

I repeat—it has stalled since 2015. The single biggest, most important factor in improving prosperity has stalled—seven years of absolutely no progress whatsoever despite repeated warnings.

The cabinet secretary can play the blame game all she likes, and the amendment in her name attempts to do just that, but it is abundantly clear that the Government has no plan for improving productivity forecasts.

We see the same scenario when it comes to average earnings in Scotland. Every year for the next five years, Scotland is forecast to lag behind the UK as a whole. That is not a recent phenomenon. Between 2016 and 2020, earnings in Scotland increased at a slower rate than in the rest of the UK, and the Scottish Fiscal Commission states that, in recent years, the gap has widened, not narrowed. Since 2016, Scotland’s average earnings have grown by 21 per cent, which is 5 per cent less than the UK average over the same period.

John Mason (Scottish National Party, Glasgow Shettleston)

The member is very good at listing some of the problems that we face, but I do not think that anyone is arguing that those are not challenges. Can he give us some answers?

Paul Sweeney (Labour, Glasgow)

Given the cost of living crisis, I am happy to accept the proposal for a superannuation.

However, the key proposals are about efficiency of investments and return on investments. There are huge, endless opportunities to increase revenue and get public investments to raise more money for Scotland. There are innumerable opportunities to outline that. Instead of having multinational utilities, the Scottish Government and councils could be making big, bold moves to aim to be the main supplier of heating to all households and businesses in Scotland, with a mass roll-out of publicly owned and developed district heating networks. There is no state entrepreneurship. That is just one example that I give John Mason to take into consideration. In his constituency, in Dalmarnock, there are district heating schemes that are not being expanded and, currently, social housing is being built with gas boilers fitted into the properties. That is introducing and seeding a cost of living crisis in our midst, when we could be doing something different.

I take no pleasure in pointing out those facts, because I want nothing more than for Scotland’s economy to be prosperous, thriving and providing a solid foundation for the improvement of people’s lives. Of course I want that, but the fact is that it is not happening. Scotland’s economy is underperforming, and the Scottish Government needs to take its share of the blame. Yes, external factors have played a role. Brexit, Covid and global inflationary pressures cannot be ignored, but the problems that I have outlined existed well before any of those external factors came in, and have left our economy less resilient in the face of those shocks. The reality of what the poor economic forecasts mean in practice is stark. Last week, the cabinet secretary outlined the Scottish Government’s spending priorities. Health and social security budgets were protected, but everything else was raided. The Scottish Fiscal Commission says that, in 2023-24 and 2024-25, spending on all other areas is expected to fall in real terms. In 2025-26, only the net zero and energy and transport portfolios are expected to increase. There we have it in black and white: austerity, the very thing that the cabinet secretary spent the bulk of her speech criticising in withering terms. For the next three years, the budgets that are afforded to local government; education and skills; the economy and finance; justice and veterans; the Crown Office and Procurator Fiscal Service; net zero, energy and transport; and external affairs and culture will be hammered, and the consequences could not be clearer.

Further cuts to local government will mean further job losses, drastically reduced services, cuts to education and skills, the further widening of the attainment gap and the sacrifice of the life chances of our children. Decimated transport budgets will result in even poorer services, which will push people away from public transport—and increase the costs and subsidy dependence—at the exact time when we should be encouraging them back.

Perhaps the worst consequence of all is the admission of scathing cuts to the number of public sector jobs in Scotland. That point is perhaps the most illustrative of the short-sightedness of this Government when it comes to the economy. Instead of investing, retaining, skilling up and increasing the wages of public sector employees, it sacks them, with the profound personal and financial consequences that that decision will have on families across Scotland. It is a symptom of a Government that is run by accountants, not economists.

It does not take an accountant or economist to see the perilous state that the Scottish economy is in. People can feel it in their pockets and in their pay packets every day. Unless something fundamentally changes and the Scottish Government finally takes its head out of the sand, we will continue on that managed decline and, before we know it, it will be too late to reverse the downward spiral that we are in.

As our amendment today states,

“the failure to grow Scottish wages will also mean that hard-working people are more exposed to the pressures of the cost of living crisis.”

That needs to be at the forefront of our minds. Squabbling about constitutional arrangements, firing figures across the chamber, blaming the Tories and cutting vital budgets will not help ordinary, hard-working people. Everyone needs to be laser focused on improving their lives in the coming years. All the evidence that I have seen so far suggests that the Government is incapable of providing that focus.

I move amendment S6M-04815.2, to leave out from “is deeply” to end and insert:

“notes the recent findings of the Scottish Fiscal Commission and is deeply concerned by many of the trends identified, including that productivity growth in Scotland has stalled since 2015 and earnings growth is lagging behind the UK’s; is further concerned, in particular, by the revised downward growth estimates and decline in real earnings, and that the Scottish Government has imposed higher tax rates on Scotland without increasing revenues, compared with the block grant adjustment, due to the ongoing issues relating to weaker productivity and inflexibilities within the Scottish labour market, with the result that net Scottish income tax receipts in 2022-23 are forecast to be £428 million less than if income tax had not been devolved; considers that this is a consequence of the Scottish Government’s failure to use the taxation, borrowing and investment powers of devolution to support and grow the Scottish economy; notes that this has directly resulted in less tax revenue available to invest in Scottish public services, and is further concerned by the real-terms cuts of more than £1 billion announced by the Scottish Government, which will affect local government, the police and higher education, among key services; calls on the Scottish Government to ensure that policies to deliver long-term growth, including collaborative projects with the UK Government such as city deals, are a priority within Scottish Government spending plans; further calls for a finance bill mechanism to be introduced to evaluate the effectiveness of public spending; calls for plans for a second independence referendum to be taken off the table, and believes that the failure to grow Scottish wages will also mean that hard working people are more exposed to the pressures of the cost of living crisis.”

Alex Cole-Hamilton (Liberal Democrat, Edinburgh Western)

I am pleased to rise to speak for the Liberal Democrats, and I am grateful to Liz Smith for securing the parliamentary time for it.

When the finance secretary outlined the Government’s spending review, she laid bare the price of Scottish National Party economic incompetence. The truth is that, when it comes to the economy, by almost every metric, we are falling behind. The SNP likes to take any opportunity that it can to set Scotland apart from the rest of the UK—well, when it comes to the economy, it has accomplished that mission, but there is nothing in that reality for those on the Government benches to take pride in.

In the past decade, under SNP rule, the Scottish economy has been consistently outpaced by the rest of the UK, which means that we have less money to spend on vital public services, many of which are currently in dire need of funding.

We have seen productivity growth stagnate while we fail to keep pace with earnings growth in England and Wales. I was interested to hear the cabinet secretary tell Daniel Johnson that she would come on to that in her remarks. I may have fallen asleep, but I did not hear her come on to that at all. This has all been coupled with downward growth estimates, as Liz Smith rightly said when she quoted Our Scottish Future.

Project after project has been mishandled and there are not enough workers to build even a handful of offshore wind turbine jackets at Burntisland Fabrications. Where are the 2,000 jobs that were promised to Lochaber by the SNP Government and Sanjeev Gupta in return for taxpayer backing worth hundreds of millions of pounds? Why will communities spend years more without the broadband connections that they need to do business and get on with their lives? The Government might not like it, but its fiscal incompetence is plain for all to see.

Not long ago, the word “ferry” would have conjured up images of relaxed day trips to some of Scotland’s beautiful islands, and island businesses expanding beyond their shores. Now, it is synonymous with cancellations, botched deals, missing documents and horrendous overspend. Those lifeline ferries were promised to our island communities so that people could visit family, go to work or attend hospital appointments on the mainland. They are years late and more than £150 million over budget. Tourist businesses, cafes and more must all be wondering what they pay their taxes for, when the absence of sailings costs them hundreds of pounds each day in lost earnings.

The same could be said for all those going to restaurants, bars and theatres, and shift workers and commuters, who are all staring at train timetables in disbelief. The Scottish Greens must be the only green party in the entire world to go into government, nationalise the rail sector and put a red pen through a third of the rail timetable. It has been reported that that is costing the Government and the Scottish economy £80 million each week. The Scottish Government had two years to prepare for its running of ScotRail, but it did precisely nothing to anticipate or avoid the dispute. Every day that this SNP-Green Government fails to provide core connections—whether they are ferries, broadband or trains—can be measured in lost revenue to our economy.

Daniel Johnson (Labour, Edinburgh Southern)

Does Alex Cole-Hamilton agree that transport disruption and chaos is a problem not just because of the disrupted journeys, but because it prevents people from getting to new opportunities and new jobs elsewhere in Scotland, which, given our regional inequalities, is a horrendous economic crime in itself?

Alex Cole-Hamilton (Liberal Democrat, Edinburgh Western)

I absolutely agree with Daniel Johnson. The £80 million in lost revenue that has been quoted is just the tip of the iceberg. It will represent a lost opportunity to grow our economy further, on top of all the social disruptions that I have laid out.

The Government has also been good at wasting opportunities. When he was First Minister, Alex Salmond often spoke of making Scotland the “Saudi Arabia of renewables”. ScotWind was the best chance for generations for the Scottish Government to bring serious money into the public purse, but, alas, it sold it on the cheap after inexplicably deciding to cap how much companies were allowed to pay in the offshore wind auction. That was despite comparable auctions south of the border and around the world showing that it is a fiercely competitive market. Who on earth puts a cap on something that they are selling in those circumstances?

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Does the member think that a £25 billion requirement to invest in the supply chain is selling it on the cheap?

Alex Cole-Hamilton (Liberal Democrat, Edinburgh Western)

I a

m sorry, but that is a very weak area for the cabinet secretary to try to defend. Anybody who has ever been on eBay knows that, when they are selling something, they put on a reserve price, which is the lowest possible price at which they will sell the item. No one puts a cap on it. No one says, “Please don’t give us any more money than we are providing in these circumstances”, but that is exactly where we find ourselves.

The truth is that Scotland’s prized sea bed was sold at a pittance. That matters, because that income goes straight—or could have gone straight—to the Scottish Government to be spent on schools, hospitals and better pay for social care workers. However, once again, we are seeing that potential squandered.

It is well past time to remove the drag of SNP economic mismanagement. The Government has its priorities all wrong. When it comes to allocating finances, as I highlighted at First Minister’s question time last week, we have recently learned that the number of people suffering from Covid has risen to more than 150,000—that is one in 30 Scots—but the First Minister is devoting twice as much money to a divisive second independence referendum as she is to that awful condition.

The SNP-Green Government is devoting its focus, top civil servants and tens of millions of pounds to an unwanted independence referendum. We need look only at the statistics that were published in the past 24 hours to see why that is indefensible: more than 300,000 operations have been lost to Covid; delayed discharges are up 64 per cent in a year; there are dangerous levels of nursing vacancies; and thousands of children and adults are waiting more than a year for the mental health support that they desperately need.

Everyone needs SNP and Green ministers to be focused on what really matters right now. Instead—

The Deputy Presiding Officer

Mr Cole-Hamilton, you need to conclude. Thank you.

Alex Cole-Hamilton (Liberal Democrat, Edinburgh Western)

I will conclude with this point, Presiding Officer. Instead, national health service staff, patients, islanders and hospitality businesses are all being taken for granted. That is shameful.

The Deputy Presiding Officer

We move to the open debate. Speeches will be of six minutes. I call Douglas Lumsden, to be followed by Michelle Thomson.

Douglas Lumsden (Conservative, North East Scotland)

It is good to be discussing this important topic, because we were unable to do so last week, as my colleague Liz Smith pointed out.

The spending review highlights the SNP-Green devolved Government’s mismanagement of our economy. With the highest-ever core block grant coming from the UK Government and more investment in Scotland than we have seen previously, it is ridiculous to see an SNP minister defend their economic decisions as they did last week.

Let us be clear that the tough decisions that this devolved Government is now facing are a direct consequence of its economic incompetence. At yesterday’s Finance and Public Administration Committee, I questioned the Cabinet Secretary for Finance on public sector job cuts. At first, I was given the usual smoke and mirrors, as we would expect of the SNP, but it was eventually mentioned that figures would go back to the levels that we saw before the pandemic.

Most of the increase was for health, and the cabinet secretary said that there will be no cuts to health staff. We have more than 1,000 staff in Social Security Scotland; I presume that that number will not be cut. We are expanding early learning and childcare provision; I presume that the Scottish Government will not reverse that policy. Therefore, we can presume only that the hammer will fall on the likes of the police, firefighters, teachers, social workers, carers, refuse collectors, road workers and lecturers, whom we need to upskill our workforce.

Kate Forbes (Scottish National Party, Skye, Lochaber and Badenoch)

Is the member distancing himself from his Conservative counterparts in the UK Government who are proposing to cut 91,000 government jobs?

Douglas Lumsden (Conservative, North East Scotland)

We are in Scotland. At least there is a bit of clarity from the UK Government. All that we get from the cabinet secretary is smoke and mirrors. She gives no answers about where the jobs will be cut. She needs to come clean with our public sector workers and let them know where the planned cuts to the workforce will take place.

I want to focus on the impact of the proposed savage cuts to local government in the spending review and on the impact of the wider economic situation on our vital public services. I have spoken before in the chamber about the importance of prevention in all our public services and the need for investment in preventive services that stops greater expenditure further down the line. I would like to focus on that, which I thought was a view that many members from all parties shared.

The spending review has shown us that this SNP devolved Government is planning to cut local government’s budget by 8 per cent in real terms by 2027. The Government suggests that local government should make savings by reducing real estate, increasing digitisation and having more shared services. That advice is an insult. That is teaching your granny how to suck eggs—local government has been doing that for the past five years to balance its budget in the face of SNP austerity.

For many local authorities, the low-hanging fruit has gone and efficiencies through digitisation have been achieved. The headcount reduction, in conjunction with unions, has been done. This deal means that jobs will be lost. Bins will be collected less often. Care packages will be cut. New schools will not be built. Roads will not be repaired. Sports facilities and libraries will close. All of that is happening on this Government’s watch, and it is a disgrace.

Tom Arthur (Scottish National Party, Renfrewshire South)

The resource spending review affords us the opportunity to consider our spending some six months out from when the budget will be presented. Can Mr Lumsden state what total quantum he believes should be allocated to local government in the next financial year and the following financial years?

Douglas Lumsden (Conservative, North East Scotland)

I will come on to the waste that this Government makes all over the place.

If there was more transparency around the budget process, that question might be easier to answer. We had

things in the budget for this year such as a line with £620 million for things that we might see coming in, including ScotWind. Now, that has been taken out of this year’s budget and put into next year’s budget, and suddenly the £620 million has miraculously just reappeared.

Prevention is much better than trying to tackle the outcomes of such austere measures. Our sports and libraries aid health and wellbeing and prevent long-term illness. Our schools and youth clubs cut down crime. Good roads cut down accidents. New schools increase attainment and opportunities for all.

Bob Doris (Scottish National Party, Glasgow Maryhill and Springburn)

Will the member take an intervention?

Douglas Lumsden (Conservative, North East Scotland)

I have taken enough interventions.

Cutting investment in our local government is short-sighted and will lead to greater costs down the track.

The SNP is also cutting off investment from key sectors such as oil and gas, which will have massive implications for the north-east and Scottish economies. At the breakfast meeting with the SFC that SPICe held this morning, we heard that one of the reasons that our economy is falling behind the rest of the UK is the decline in the energy sector and the income tax take from it. It is clear that the SNP Government does not back the oil and gas industry and is driving investment away. While we still have a demand for hydrocarbons, it is better for the environment and better for jobs in the north-east that the energy industry in this country is protected and supported. This devolved Government’s outright hostility to the industry is directly related to the cuts that it is having to make to public services. The Government needs to change its tune before it is too late.

Much has been said today about the cost of living crisis. Time will not allow me to go into detail here, but the UK Government has now provided over £37 billion of support to families. However, families in Scotland will have to pay more income tax than families in the rest of the UK—a point that Liz Smith covered earlier. That is the Scottish Government’s contribution to the cost of living crisis: higher taxes.

And what is this devolved Government doing with our taxes? It has spent £250 million on ferries that do not sail, £40 million on the doomed, malicious prosecution of Rangers and £50 million on loans to BiFab, and now £20 million is being allocated for an independence referendum next year. That is £4 million more than it has allocated as an increase in the education budget. Colleagues, that is an absolute disgrace. This Government holds its obsession with having a referendum above the education of our children.

The spending review has so many areas of concern that we can only skim over today. We will have more sessions in committee—maybe—to go over it in detail. However, the SNP-Green coalition will need to put the needs of the people of Scotland at the heart of its policies—

The Deputy Presiding Officer

Mr Lumsden, you need to conclude. Thank you.

Douglas Lumsden (Conservative, North East Scotland)

—

and not its obsession with independence. We need more spending on our local authorities so that they can deliver our vital services. We need this false nod—

The Deputy Presiding Officer

Mr Lumsden, could you please conclude your remarks? Thank you very much.

Douglas Lumsden (Conservative, North East Scotland)

—

to an independence referendum dropped, with the money going towards education.

Michelle Thomson (Scottish National Party, Falkirk East)

If the past few days have taught us anything, it is that the price of dependence on the failing UK state and leaders such as Boris Johnson makes the need for Scottish independence all the more urgent.

Economics cannot be understood without a deep appreciation of society. That idea was fundamental to the work of Adam Smith. To understand

The

Wealth of Nations

, it is best to read his earlier work

The Theory of Moral Sentiments

. Smith knew only too well the importance of justice, of effective administration of the law, of ethics, of human behaviour and of empathy for others—all issues that the Tory Government at Westminster shows little regard for.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Adam Smith also talked substantially about the importance of economic growth. I ask Michelle Thomson to expand on what her Government believes are the most important features of improving economic growth.

Michelle Thomson (Scottish National Party, Falkirk East)

I am delighted to have taken that intervention, because I will go on to reflect much more carefully on economic growth, gross domestic product and so on.

As well as a lack of morality, I notice the absence from the Tory motion of any mention of Scotland’s assets. We know about the Tories’ track record of exploiting Scotland’s resources such as those in the North Sea. Of course, Norway invested in its future and created a fund for long-term investment while successive UK Governments squandered the riches. At that point, there was no empathy with the needs or, indeed, the rights of the Scottish people, so long as the Tories’ friends in the City of London were doing all right, thank you.

Today, Scotland has the prospect of an even larger and longer-lasting asset, with the wind and seas driving a revolution in sustainable energy production. Earlier today in the chamber, I commented that Scotland’s anticipated energy production capacity far exceeds even our own 2030 target.

We need to put the needs of people and society at the heart of our economics. I ask the people of Scotland to focus on the right outcomes. Who do we trust? Is it a Government elected by Scotland for Scotland, or Boris Johnson?

The Tory motion talks of concerns about the growth estimates being revised downwards, but it fails to acknowledge the failure of UK Government policies that contributes to that.

Craig Hoy (Conservative, South Scotland)

Will the member give way?

Michelle Thomson (Scottish National Party, Falkirk East)

Let us take the previous 20 years and run an international comparison of GDP growth rates.

Sorry, but I missed the member. I will come back to him.

From that comparison, we find that the UK’s growth was 68 per cent in nominal terms, while the average large advanced economy grew by 93 per cent and the average small advanced economy grew by 138 per cent, which is double the cumulative growth of the UK economy. Scotland is having to pay a heavy price for that UK failure and for being tied to the UK’s economic mismanagement, particularly in comparison with other medium-sized advanced economies, many of which have a weaker asset base than Scotland has.

Douglas Lumsden (Conservative, North East Scotland)

Will the member take an intervention?

Michelle Thomson (Scottish National Party, Falkirk East)

I will take one if the member is going to directly counter my figures and give figures that show that I am wrong.

Douglas Lumsden (Conservative, North East Scotland)

I am just curious to know why Scotland’s growth figure is half that of the rest of the UK. Can the member please explain that?

Michelle Thomson (Scottish National Party, Falkirk East)

I can absolutely explain it. I can refer directly back to the cabinet secretary’s comment that members on the Tory benches seem incapable of understanding the difference between micro and macro economics. I encourage them to look at exactly which powers reside in Westminster, as that is absolutely the crux of the debate.

If the Tories had a genuine concern about growth or any understanding of economics, the motion would be shouting from the rooftops for Scotland to have full economic powers. I notice, too, that the motion says nothing about the straitjacket that is imposed on Scotland by our lack of borrowing powers, which the cabinet secretary referenced. The Tories complain about highly uncertain forecasts, but they have not mentioned that UK public sector net borrowing was £151.8 billion in the financial year ending March 2022. If it is good that the Government of Boris Johnson can borrow so freely, why is the Scottish Government denied those powers?

The pseudo economics of the Tories also turns a blind eye to corruption and large-scale financial crime, which distorts markets and punishes consumers and businesses that play by the rules.

Craig Hoy (Conservative, South Scotland)

rose—

Michelle Thomson (Scottish National Party, Falkirk East)

I am sorry, but I have only one minute left.

The egregious law breaking of Boris Johnson really matters, because it not only displays a disregard for our society but almost permeates into the economy. As long as Boris Johnson and, indeed, most of the Tories care not about money laundering and other forms of financial crime—the cost of which is counted in the hundreds of billions of pounds annually, according to the UK’s National Crime Agency—and as long as they care not about the distortions created in markets and the wider economy or about the people they are supposed to serve, the state capture that has taken place in the UK will continue in both our society and our economic system.

However, the most objectionable aspect of the Tory motion is the undercurrent of trying to force a feeling of helplessness and dependency in Scotland. The Tories seek to damage the Scottish people’s belief in themselves and to feed the myth that it is better to allow people such as Boris Johnson to be in charge than for us to be accountable for creating our own future. Of course, that explains the Tories’ fear of allowing the Scottish people to decide their future, but they will fail to prevent us from doing that. Scotland will be the wealthiest country ever to achieve political independence, and that will put the people of Scotland in charge of our future.

Michael Marra (Labour, North East Scotland)

I thank Liz Smith for moving her motion and bringing the debate to the chamber. I am happy to support the amendment in Paul Sweeney’s name.

I start by directly quoting remarks that were made by the First Minister some six years ago. She said that

“excellence in education is essential to our prosperity, competitiveness, wellbeing and to our overall success as a nation.”

I could not agree more with those remarks, but last week’s resource spending review is a damning indictment of the Government and shows what its priorities truly are. The suggestion that education is by any means up there is an insult to the intelligence of the Scottish people. It was once said that education was the Government’s “defining mission” and a sacred cause, but none of that was true, was it?

In response to the cabinet secretary’s spending review, the Scottish Fiscal Commission has made it clear that there will be an 8 per cent real-terms cut in Government spending on colleges and universities. The cuts will not just devastate colleges and universities but tear through every tier of our education system, from local government and early years schooling to academic innovation and research.

At the heart of the cuts lies the SNP’s inability to reconcile itself with the reality that a strong and properly resourced education system is integral to the Scottish economy. It is, to be frank, the single greatest economic lever that we will ever have in this country. The net output of properly investing in our education system and, by extension, our young people is that our workforce and society will be strengthened and diversified. Proper investment from pre-school to PhD level is crucial in order to fill job vacancies, nurture talent and support economic development. In fact, research by London Economics shows that, for every £1 million of Scottish Government investment in university research, £8 million of economic growth is generated. As colleagues have highlighted, we could do with some more of that.

John Mason (Scottish National Party, Glasgow Shettleston)

Is the member’s broad argument that we should be putting more money into education and less into social security?

Michael Marra (Labour, North East Scotland)

No. Mr Mason is right to highlight that it is a question of priorities. The Government has to make choices. Other colleagues have raised issues about waste and the choices that are put to the Scottish people at elections. The Government says that its priority is education, that it is a sacred mission and that it is its defining purpose, but the Government needs to back that up with action. Both things cannot be true at the same time.

The Government has made its choices, and Labour will put forward the choices that we would make.

However, the budget is not fixed in the way that some members wish to suggest it is. We can grow our economy and the amount of money in our coffers, and we can ensure that we have a better tax take in our country.

It is particularly troubling that the SNP has decided that now—when our schools, colleges and universities finally have the chance to pull back from the rubble of Covid and the resulting educational deficit that the pandemic has left behind—is the time to hit schools, colleges and universities with a further blow.

I sincerely hoped that the cabinet secretary would, at the very least, have recognised the need to invest in the cohort of students and young people who have suffered so much over recent years. They have lost a large amount of their education, and their life chances have been particularly harmed. I know that there might be talk of spending in future budgets, but the spending review has set a clear direction of travel, with trouble ahead for all those services. The incredible disruption over the past two years will have taken an immense toll on young people’s academic and mental wellbeing, with the effects being felt not just at the moment but for many years to come.

Colleges are already dealing with substantial cuts in this financial year. This morning, the Education, Children and Young People Committee heard about voluntary and, potentially, compulsory redundancies across the sector. I remind the cabinet secretary that that is the very sector that is meant to handle the energy transition in our economy. Members have mentioned the need to transition to a net zero economy, so we need to ensure that we invest in and support that sector.

In the past couple of weeks, Scottish universities have received outstanding results from the research excellence framework, but they have also been rewarded with cuts. Simultaneously, research funding in England has shot up. On the same day as the resource spending review was announced, UK Research and Innovation announced a 31.7 per cent increase for research over three years. That is the competition—that is the reality. Our universities have to compete in that marketplace, have to work to recruit the same staff—outstanding, excellent staff—from across the world and have to ensure that they can match those terms. That compounds a long-term trend.

I say to SNP members that eight of our top 10 universities in this country have progressed at a slower rate than their comparators in the rest of the UK. There are direct consequences of that. UKRI funding had been a national advantage—we had previously captured 15.4 per cent of it—but it is now reduced to 12.9 per cent. The trend is only going in one direction and the decisions that are taken today further exacerbate the situation.

All of that results in the points that colleagues have made: productivity is stalled since 2015; failure to grow wages and the direct impact that that has—

Richard Lochhead (Scottish National Party, Moray)

Does the member recognise that the biggest threat to research funding that the university sector in Scotland is mooting as we speak is the UK Government’s threat not to participate in the horizon programme? That is a perfect example of how the UK Conservative Government is damaging research in Scotland, which is a priority of the university sector at the moment.

Michael Marra (Labour, North East Scotland)

I agree with the member that it is entirely irresponsible to withdraw from the horizon programme. It is a massive issue for our universities. However, proportionately, the amount of money that is brought into Scotland by the horizon programme is dwarfed by the central funding that UKRI and the Scottish Funding Council provide, which, in proportion, is just as important, if not more so.

I will conclude on this point, Presiding Officer—I appreciate the leniency. The Government has long known the challenge of demographic transition, and there has been no substantive programme of reform to address it. Michelle Thompson is keen to talk about Adam Smith, although I am not sure that he would agree with her on the idea of throwing up trade barriers across the UK. I would point to the work of Mariana Mazzucato and the idea of an entrepreneurial state that can grow our economy, invest in our people and build a better future for Scotland.

Paul McLennan (Scottish National Party, East Lothian)

I thank the Tories for introducing the debate, which allows us to compare the policies of a UK Government that is failing Scotland with those that an independent Scotland would benefit from.

The Tory motion mentions

“downward growth estimates ... a decline in real earnings”

and labour market “inflexibilities”. The main levers of economic powers are still held at Westminster, and I will mention the impact of that situation in my speech.

Douglas Lumsden (Conservative, North East Scotland)

Will the member take an intervention?

Paul McLennan (Scottish National Party, East Lothian)

No. I have just started.

The Tory motion highlights the failures of the union and the negative impacts that it has on the Scottish economy.

“Britain’s economy is in a bad place. Removing Boris Johnson might help” was the headline of an analysis by Julia Horowitz, who is a CNN business analyst. She said:

“Boris Johnson survived a vote of confidence on Monday triggered by lawmakers in his own party. They’ve been angered by government parties that broke coronavirus rules, his handling of a deteriorating cost-of-living crisis and a dearth of clear policy goals.”

That is how others see the UK. She went on to say that the cost of living crisis had been caused in large part by global factors, but that Brexit had significantly exacerbated it.

The UK economy ground to a halt in February and started shrinking in March.

Douglas Lumsden (Conservative, North East Scotland)

Will the member take an intervention?

Paul McLennan (Scottish National Party, East Lothian)

No. I have just started.

The UK economy is continuing down that route. We are heading into a recession. Retail sales fell in May for the second consecutive month. The British pound has plunged almost 8 per cent against the US dollar this year alone, losing even more than the euro. That impacts on Scotland.

Jamie Greene (Conservative, West Scotland)

Will the member take an intervention?

Paul McLennan (Scottish National Party, East Lothian)

I will in a second.

The pound is the third worse-performing major currency this year. Only this morning, the cabinet secretary mentioned that the OECD forecasts that the UK will have the lowest growth rate and the highest inflation rate in the developed world, apart from Russia. Stagflation, here we come.

Douglas Lumsden (Conservative, North East Scotland)

The member spoke about independence and about currency. Can he confirm what the currency would be in an independent Scotland?

Paul McLennan (Scottish National Party, East Lothian)

I think that that was set out in the growth commission’s work and is there for everyone to see.

Last week, Bank of America strategists stated:

“Investors should hedge for an ‘existential’ sterling crisis as the British currency faces struggles usually seen in emerging markets”.

CNN states:

“Around the world, countries are facing huge economic challenges ... but the United Kingdom is in a particularly bad spot”,

and:

“The knock-on effects of Brexit have led to crippling labor shortages and boosted operating costs for businesses, making the spike in prices even worse.”

UK Government policy impacts on Scotland.

Inflation in the UK reached 9 per cent last month. It is above the rate of 8 per cent in the United States and Germany’s 7.4 per cent. Japan’s economy, which was characterised as low inflation for decades, has the lowest inflation rate, at 1.2 per cent. UK Government policy impacts on Scotland.

The Tories and the Labour Party are keener than ever to talk down the Scottish economy at every opportunity. Of course, that is fuelled by the independence debate, with unionist parties feeling the need to highlight the negatives and ignore or dispute the positives when it comes to Scotland’s economy.

Last week, the University of Glasgow issued a report that highlighted that people across the UK are dying younger because of UK Government austerity. The people who are living in the poorest areas are the hardest hit. It says:

“Mortality rates, and related indicators such as life expectancy, are important markers of the health of a population. Over the past two centuries, there has been a consistent improvement in mortality rates across the UK. However, after 2012 life expectancy stopped improving and death rates among people living in the poorest areas have increased.”

Scotland spends more than £700 million a year mitigating Tory welfare policies, which impacts on our ability to spend in other areas. UK Government policy impacts on Scotland.

Jamie Greene (Conservative, West Scotland)

Will the member take an intervention?

Paul McLennan (Scottish National Party, East Lothian)

No.

Let me recap. What impacts on our spending power and fixed budget? Scotland has no powers over interest rates and no ability to vary national insurance rates, and it had no say over Brexit—of course, the Labour Party supports that position. Inflation is at a 40-year high—our rate is the highest in the G7—and our currency has “emerging market characteristics”, and analysts are advising investors to hedge against it.

Michael Marra (Labour, North East Scotland)

The member has cited the growth commission’s position as his own on currency, but that would not allow for control over our interest rates either, would it?

Paul McLennan (Scottish National Party, East Lothian)

The growth commission said that that would be the initial position and then we would move on to our own currency, which would set rates.

Of course, we are still feeling the impact of Brexit, but the Tories have not mentioned it—not even once—during the debate. Not one Tory MSP has mentioned Brexit in this debate.

What can Scotland influence? Scotland has its own inward investment and trade agency in Scottish Development International. That organisation and its performance are very much in the control of the Scottish Government. Last week, Ernst & Young published a survey showing how well Scotland is doing on the foreign direct investment front, relative to other parts of the UK and to countries elsewhere in Europe. Funnily enough, the Tories have not mentioned that either.

Scotland outpaced UK progress significantly. Ernst & Young declared that Scotland had made

“great strides as a destination for FDI”

in 2021. It stated that its findings suggest that the outlook for FDI in Scotland is exceptionally bright.

Scotland achieved a 14 per cent rise, to 122, in the number of inward investment projects secured in 2021, which put the 1 point increase in the UK in the shade, while countries across Europe saw an overall 5.4 per cent rise in attracting FDI projects. That increase in inward investment projects in Scotland was the fourth consecutive annual rise. Ernst & Young stated that, in the past year, Scotland continued to

“make further great strides as a destination for FDI, meaning we can look forward to the future with even greater confidence.”

Scotland’s record level of attractiveness is underpinned by investors rising perceptions—how others see Scotland.

Estonia regained independence in 1991. Its GDP has since increased fivefold, and today it is recognised as Europe’s Baltic tiger. After the velvet divorce from the Czech Republic, Slovakia saw its economy grow by 60 per cent in the 10 years thereafter. Denmark and Norway have GDPs of between 30 and 40 per cent—higher than Scotland’s. Are there lessons for Scotland there, or are our circumstances simply too different, as the Opposition would tell us?

The UK’s stewardship of the economy is failing Scotland. Scotland is on a journey towards independence and, like every other independent country, the right to choose its own path, run its own economy and rejoin the EU. Scotland is on that journey, and will find its way home soon. Scotland will regain its rightful place in the world.

Alexander Stewart (Conservative, Mid Scotland and Fife)

I am grateful for the opportunity to speak in support of the motion in the name of my colleague Liz Smith.

As Scotland continues to recover from the economic damage of the past two years, careful management of the economy should be one of the highest priorities for the Scottish Government in the coming years. The debate is an important opportunity to highlight some of the SNP Government’s failures in that area. As the recent analysis by the Scottish Fiscal Commission confirms, the economy is an area in which the Government’s record is one of wasted potential and failure.

One area where such failure is abundantly clear is income tax. As with so many areas, income tax is one over which the Scottish Government has received substantial new powers only to fail to use them properly. The introduction of two additional income tax bands in Scotland was supposed to have been done to create a more progressive tax system. Regardless of the Government’s intentions, that does not justify the creation of a system that has been described by the Institute for Fiscal Studies as “unnecessarily complicated”.

Of course, the Government may claim that having a more progressive tax system means that lower-income households pay less tax than they otherwise would, but, given that analysis by the IFS finds any savings for those households to be “barely apparent”, it is clear that the current system fails to achieve that.

What does the Scottish Government have to show for all its fiscal meddling with Scotland’s tax system? According to the most recent analysis, it has more than £400 million less than it would have done if it had simply stuck with the UK tax bands. That is yet another example of the Scottish Government receiving significant new powers, only to completely misuse them. It was perhaps the IFS that best summarised the situation when it stated that the SNP’s income tax changes had achieved little more than making a “political statement”—a political statement that is affecting poor individuals the length and breadth of this country and is resulting in hard-working families paying more.

We know from all the economic statistics that there is a substantial black hole in the public finances. That is despite the UK Government’s block grant providing real-terms increases in funding for every year of the parliamentary session. While IFS analysis suggests that the deficit could turn out to be significant, we already know about the cuts that vital public services are facing as a result of that black hole.

Education and policing budgets are set to be hit with real-terms cuts over the course of the parliamentary session. Unsurprisingly, local government will, once again, bear the brunt of those cutbacks. The Scottish Fiscal Commission’s analysis suggests that local government budgets will be cut by 7 per cent in real terms by 2027. Even taken by itself, a figure of such magnitude should set alarm bells ringing for the Government.

We must not forget that that follows on from a period in which councils have had their budgets slashed. Between 2014 and 2021, funding for local government fell by 2.4 per cent in real terms, and it received a £250 million real-terms cut in the 2022-23 budget.

More and more often, the councils of communities across Scotland are faced with no choice but to provide only the services that they are legally obliged to provide. On current forecasts, I fear that that trend is set to continue, with money being removed from local government budgets, facilities being closed and families losing opportunities in their communities, despite what the Government says that it wants to achieve for those communities and our constituents.

We have now had 15 years in which to learn about the SNP’s economic priorities in Government, and it is clear that local government has never been one of them. As the spending review makes clear, disappointingly, that is unlikely to change.

This is the first opportunity that I have had to highlight such issues in my new role as shadow minister for just transition, employment and fair work, but it will certainly not be the last time that I highlight the SNP’s failures in this area. The Scottish Government has a lot of work to do to get Scotland’s economy back on track and to deliver budgets that are truly reflective of the Scottish public’s priorities.

The Scottish Government should commit to aligning income tax rates with those for the rest of the UK. It must also work alongside the UK Government to capitalise on the potential for both of Scotland’s Governments to work together. The city region and growth deals, which now cover nearly every part of Scotland, have shown what can be achieved through cross-Government co-operation, and the Scottish public will rightly expect to see more of that in the coming years.

The SNP should drop its plans for a divisive and desperate independence referendum that the Scottish public simply do not want. We had a choice and we made our choice. To put £20 million aside for another referendum is an absolute insult to hard-working families the length and breadth of the country.

I support the motion in Liz Smith’s name, and I urge members across the chamber to do likewise.

John Mason (Scottish National Party, Glasgow Shettleston)

I am more than happy to take part in the debate.

We are facing challenging times financially and economically, and inflation is a major part of that. The war in Ukraine, with its impact on energy and food prices, has been very much outwith the control of the Scottish Government—and most Governments, for that matter—yet we are now having to live with the consequences.

The decline in real earnings is important, not least for those personally impacted. We discussed the matter at some length on Tuesday at the finance committee. A lot depends on not just what level inflation peaks at, but how long higher inflation continues. If it is just for one year and there is then a rapid reduction in inflation to the target of 2 per cent or thereabouts, many employees might live with that. However, if higher inflation continues longer, with a spiral of wage and price inflation, we will all face serious problems.

I would like to look a little more closely at the Tory motion, especially the suggestion that tax rates have been made higher

“without increasing revenues,”—

there is a comma at the end of the phrase—which is followed by the phrase:

“compared with the block grant adjustment”.

At the very least I consider that to be poor English, but I suspect that it has been written deliberately to try to confuse both the Parliament and the wider public.

The Conservative motion attempts to conflate two or three distinct issues. First, the different tax rates in Scotland have raised more revenue than would have been raised if we had left rates the same as those in the rest of the UK. The figure was estimated at £240 million in 2018-19, so there has been real extra money to spend on health and other priorities.

Secondly, Scottish earnings—and therefore Scottish tax receipts—have not been growing as fast as UK earnings and taxes, and we are all agreed on that. There are a number of reasons for that, including the decline in oil and gas in the north-east of Scotland, where there had been many high earners and taxpayers, and the inability of most parts of the UK, including Scotland, to compete with London and the south-east. I see that our Liberal Democrat friends have left the chamber, but, as Vince Cable said in 2013, London is like a black hole,

“draining the life out of the rest of the country”.

Daniel Johnson (Labour, Edinburgh Southern)

The member is right on the detail, but that does not explain why every Scottish region was underperforming against the UK Government average. That is surely cause for concern and is not entirely supported by his London explanation.

John Mason (Scottish National Party, Glasgow Shettleston)

It depends on which figures we look at. If we look at the longer term, certainly since I have been in the Scottish Parliament, we see that, although the picture changes from year to year, on the whole, Scotland compares favourably with most English regions with the exception of London and the south-east. An example that one of my colleagues gave is that, when figures on international inward investment were published recently, Scotland was doing very well.

Thirdly, the Tory motion implies the question whether we would have had more income for the Scottish budget if income tax had not been devolved at all. If that were the case, it would show that

“the current financial and fiscal arrangements between the UK Government and the Scottish Government are deeply flawed”—

which is a quote from the SNP amendment. That implies that the fiscal framework is deeply flawed and needs to be looked at as soon as possible.

None of what I have said is to say that the Scottish Government or we, as the Parliament, should not be taking responsibility for what we can control. Of course, we should be seeking to grow the economy, increase productivity and achieve increasing tax revenues. However, it does mean that we have to be honest and realistic about what we can and cannot do under the present fiscal framework. It seems to me that changes to that fiscal framework need to be made as soon as possible.

Going back to the wording of the Conservative motion, I find it somewhat ironic that Conservative members frequently stand up in the chamber and make points of order about the accuracy of Government answers, yet when they produce a motion, it seems that it is clearly intended to mislead.

On the content of the resource spending review, I very much agree that our focus should be on the neediest in our society, so it makes sense to protect social security spending, even if we will have to make savings in other areas that will be clearly disappointing. However, as the cabinet secretary said, we cannot prioritise everything.

Liam Kerr (Conservative, North East Scotland)

Will the member take an intervention?

John Mason (Scottish National Party, Glasgow Shettleston)

If it is brief.

Liam Kerr (Conservative, North East Scotland)

I am grateful. If the SNP is to cut budgets for local government, the police, prisons, universities and rural affairs by about 8 per cent over the next four years, while providing £20 million for indyref 2, can we take that as a sign of where the member’s priorities lie?

John Mason (Scottish National Party, Glasgow Shettleston)

Frankly, that £20 million would not make much of an impact on the police, local government or a number of other issues. I will come back to that if I have time.

I think that the report of the Glasgow Centre for Population Health has been mentioned. It talks about life expectancy in Scotland between 1995 and 2019. Up to 2009, there was a general increase in healthy life expectancy for males and females, but from 2011 to 2019 there was a decrease of two years across the board and a decrease of 3.5 years in the 20 per cent most deprived areas. We must focus on the poorest people in the country.

There is inconsistency in the Labour amendment. Labour calls for long-term growth, but refuses to accept that we could get long-term growth by being independent, like other smaller countries. That is inconsistent and hypocritical of Labour.

Alison Johnstone (Presiding Officer, Lothian)

You must conclude now, Mr Mason.

John Mason (Scottish National Party, Glasgow Shettleston)

I hope that the Opposition parties will engage in an adult and constructive way. They should, by all means, give us their priorities, but they cannot have everything.

Katy (Labour, West Scotland)

I warmly welcome the debate and the opportunity to consider the significant announcements that were made last week.

We have heard from many members about the backdrop to the discussion. Across the UK, we have the sharpest fall in living standards, rising food and fuel prices and rising inflation. As members said, Brexit, the pandemic and Ukraine make the economic situation more challenging.

As members also said, there seem to be specific issues in Scotland around poor productivity and earnings growth. The growth forecasts are poor.

We know that, given the announcements last week, we face significant cuts in budgets for many sectors for which the Scottish Government is responsible.

I will focus on the impact of those cuts. Local government will be significantly affected by a cut of approximately 7 per cent. When the announcements were made last week, Unison’s Scottish secretary, Tracey Dalling, said:

“This is a desperate day for public services that will have catastrophic consequences for Scotland’s communities”.

I want to focus on a sector for which the impact of the cuts will be disastrous: the justice sector. The sector is already in crisis. Before the pandemic, approximately 13,400 sheriff court trials were outstanding. As the Criminal Justice Committee indicated in a report earlier this year, there are now approximately 32,400 outstanding cases in the sheriff court.

In last week’s announcements, significant real-terms cuts of at least 20 per cent over the next few years were proposed. The Crown Office and Procurator Fiscal Service budget is frozen at £170 million per year until 2026-27, the community justice budget is frozen at £47 million per year until 2026-27, and the justiciary budget is frozen at £29 million per year until 2026-27. The legal aid and Scottish Police Authority budgets are also frozen, along with the budgets for the Scottish Prison Service, the Scottish Courts and Tribunals Service and the Scottish Fire and Rescue Service.

I fully appreciate that politics is about priorities and choices, as members have said, but those real-terms cuts will have significant impacts on a sector that is already in crisis. The projected gap is £3.5 billion. The Parliament needs to debate such issues, because the impacts will be significant.

We know that there is a massive backlog in trials—43,606 as of February—and that Scotland has the highest proportion of people in prison anywhere in Europe. It has historically had very high percentages of people on remand, which rose to 30 per cent, and perhaps higher, during the pandemic. We also know that it costs £40,000 a year to keep a prisoner in prison. There are significant impacts and consequences of the types of cuts that were announced last week, which the Parliament needs to debate.

I have focused on one sector, but other sectors have similar stories. It has been said that it is a matter of choice and that other sectors have perhaps done better. The challenges that we face in the health sector and social security budgets have been mentioned.

I hope that we have a serious debate about how we make the Scottish Parliament’s budget bigger. I do not think that it is helpful to specifically focus on independence in this debate, because the Parliament can do many things with the powers that it already has. We heard a number of speeches about income tax, and we heard my colleague Paul Sweeney talk about what could be done with district heating. There is much that could be done on municipal energy production that would contribute significantly to many of the issues before us today.

We urgently need to consider what we could do on land taxes, and we need serious proposals for a land value tax, including looking at what we can do to tax the profiteers such as Amazon, which operates out of warehouses that could fall under a land tax. Those are the kinds of debate that we should be having in the chamber.

Christine Grahame (Scottish National Party, Midlothian South, Tweeddale and Lauderdale)

Will the member give way?

Katy (Labour, West Scotland)

I will take an intervention, and I hope that I will get my time back.

Christine Grahame (Scottish National Party, Midlothian South, Tweeddale and Lauderdale)

The member mentioned Amazon in relation to tax, but that is not a tax over which we have power. That is the whole problem for the Labour Party.

Katy (Labour, West Scotland)

A land-based tax would be lawful, and I hope that we come back to that debate. I look forward to debating the member on that specific issue in future.

A number of reports have indicated the types of taxes that are within the powers of the Parliament. The Scottish Trades Union Congress, in a joint report with the Institute for Public Policy Research Scotland, listed a number of areas that we could be looking at, including local inheritance tax, local payroll tax, fair work supplements on business taxes, local income tax and carbon taxes.

I hope that, in coming debates, we seriously engage with those suggestions and that the Scottish Government comes forward with proposals on how we meet the massive challenges of the coming years.

Jim Fairlie (Scottish National Party, Perthshire South and Kinross-shire)

There are two words that I did not expect to hear much in Conservative members’ speeches today. Those words, of course, are the two Bs: Boris and Brexit—

two pretty big Bs for anybody to deal with. Boris blunders along and bungles Brexit. Meanwhile, the disastrous consequences of Brexit are swept under the number 10 carpet, no doubt alongside all the party hats and empty bottles. I am afraid that the OBR estimated that, by last year, only two fifths of the Brexit damage had yet been inflicted.

The Tories chose to title this debate “Economic Priorities”, so let us consider the priorities and choices that they have inspired. Whereas the UK Government has chosen to cut universal credit, the Scottish Government has increased the Scottish child payment. Whereas the UK Government continues to impose the bedroom tax, the Scottish Government continues to protect people from it. Whereas the Tories want to ensure that no one in Scotland pays more income tax compared with people in the rest of the UK, we, in the SNP, see the benefit in making progressive changes to the tax system, so that those who are at the bottom pay less and those who are at the top pay a wee bittie more.

The Tories are happy for the UK Government to plunder Scotland’s resources in the North Sea to make grand gestures across the UK. On the one hand, we have to use huge amounts of a limited budget to mitigate Tory policies, and on the other hand, the rest of the UK benefits from Scottish resources. What does that tell us about Scotland’s place in this union of equals?

The picture of growth is not the same across all sectors. Yesterday, I read that the industrial biotech sector in Scotland is not only exceeding growth expectations but is on track to achieve an annual turnover of £1.2 billion and more than 4,000 jobs by 2025. That is way in excess of the initial targets of the national plan for industrial biotechnology, which were set at £900 million in turnover and 2,500 employees by 2025.

I have spoken previously, and often, about the fantastic growth in the Scottish tourism and food and drink sectors over the years—which is now under threat from Brexit and the Tories—and areas such as renewable energy, which still have massive potential.

My colleague Paul McLennan talked about the growth commission, but it is worth repeating that Ernst & Young’s annual survey of foreign direct investment showed that Scotland recorded a 14 per cent increase in such projects in 2021. That is not a little bit better than the rest of the UK; it is streets ahead. That is a truly significant level of investment compared with an increase in foreign direct investment of 1.8 per cent in the rest of the UK and 5.4 per cent across Europe. If we are worried about growth figures, that is exactly the sort of thing that will turn the situation around. People want to invest in Scotland and do business here, and, according to Ernst & Young’s survey results, Scotland’s perceived attractiveness to investors now sits at a record high.

Douglas Lumsden (Conservative, North East Scotland)

The member talked about

growth figures for specific sectors, but why does he not look at the growth figures overall? Scotland’s growth figure is almost half that of the rest of the UK.

Jim Fairlie (Scottish National Party, Perthshire South and Kinross-shire)

The macroeconomics sit with Westminster.

However, to go back to the point that I was making, that investment is no flash in the pan. We have been the most successful nation or region in the UK—outside London—at attracting foreign direct investment for nine of the past 11 years, and for the seventh year running. Why are we doing so well in that field? I imagine that the proactive work that is being done by the Scottish Government in offices in various major European and other cities worldwide played a large part. I will give credit where it is due and say that that programme of work began before devolution under a Tory Scottish Office, continued through the Labour-Liberal Democrat days and truly flourished under the SNP. The modern-day Tory response to that success story was that Stephen Kerr decided to write to Dominic Raab to bleat about the waste and beseech him to put the First Minister in her place and ensure that we do not see any further additions to that network. I say to Mr Kerr that he had better buckle up, because we intend to go a lot faster—not stop.

That brings me neatly to the last part of the Tory motion that we are debating. It wants us to take plans for a second referendum off the table. Well, I have news for Tory members: it was the people of Scotland who put that on the table by electing a party that decisively won the 2021 Scottish Parliament election when there was an explicit commitment in our manifesto for holding such a referendum.

The amount that was set aside for the referendum is, in relative terms, tiny, but what a powerful tiny investment it will prove to be. It will give our nation the opportunity and ability to finally operate as a normal country. It will mean that we have the power to address the economic problems that we have to face and to engage with other countries. It will allow us to build bridges rather than put ourselves behind false barricades—as the UK has decided to—and to take responsibility for our own future. That independence is priceless.