Meeting of the Parliament 20 February 2018
I am saying very clearly to Mr Mackay that there is an onus on him in the legislation. If he disagrees with that forecast, he can produce his own forecast and provide a written explanation to Parliament. However, Mr Mackay put in his proposals, the SFC told him that there was £56 million less, he wrote down the figure and said, “Thank you very much,” and then included that forecast in the budget. That means that we have £56 million less to spend on the NHS, to invest in public services and to properly support the funding of public sector pay.
Mr Mackay could have looked at alternative models and alternative forecasts. The issue has been looked at seriously by some of the Parliament’s committees and we have seen international examples, such as variances in taxes in US states. The Finance and Constitution Committee looked closely at what happens in Switzerland, where there are different tax rates, and noted that the behavioural aspects are minimal.
Mr Mackay had an opportunity to challenge the SFC forecast and come up with his own forecast. We do not know anything about the process—he might have challenged the forecast. However, the reality is that there is £56 million less in the budget because he accepted that forecast. Alternative methodologies could certainly have been used and examined.
Labour thinks that the Government’s proposals fall way short. We have proposed a £960 million plan to invest in the Scottish budget because that is what is required. If we look at the level of the cuts that local councils are facing, even taking into account the settlement that was announced at stage 1, we can see that there is still a £368 million shortfall.