Chamber
Meeting of the Parliament 26 January 2011
26 Jan 2011 · S3 · Meeting of the Parliament
Item of business
Budget (Scotland) (No 5) Bill: Stage 1
Forgive me, but I have a great deal to cover.
The key issue of efficiency savings has exercised the Finance Committee and our predecessors in sessions 1 and 2. There are many well-rehearsed issues around efficiency savings, including the problem with having year-on-year targets, which means that the easier options were taken some time ago and therefore future efficiencies are ever harder to find.
The major concern with efficiency savings throughout devolution has been the reliability of reporting information provided by public bodies. Reporting arrangements have yet to be set out for 2011-12. In our report, we call on the Government to explain how it will ensure that the test that the cabinet secretary has set out in relation to efficiency savings will be enforced. As a matter of urgency, we ask the cabinet secretary to set out clearly whether efficiencies for 2011-12 will be recycled or whether they will be used to reduce the funding gap.
The protection of the universal services that the Government provides formed part of our work during the budget strategy phase. Although we recognise that changing many of those services will have an effect only in the medium to long term, the report invites the Government to be more transparent in explaining the long-term impact on other aspects of the budget, especially given the pressures of demographic change.
We considered capital spending in depth, given the scale of the cuts in the capital budget and its importance in promoting economic growth. The committee agrees with public finance experts that investment in housing could have an immediate positive impact on economic growth.
Although the Finance Committee’s preventative spending inquiry proposals will be discussed in depth at our chamber event on 4 March, I want to put on record our strong support for the concept of preventative spending and our belief that more effective use of preventative spending could deliver great social and financial benefits to Scotland. The Scottish Government shares that view, claiming that preventative intervention
“lies at the heart of the Government’s policy interventions”—[Official Report, Finance Committee, 30 November 2010; c 2833.]
and is
“integral to the approach to government in Scotland and delivering the outcomes set out in the National Performance Framework”.
Given the strong consensus demonstrated by the committee, the Scottish Government and witnesses, we recommend that future draft budgets include an assessment of progress that is being made towards taking a more preventative approach. We will also recommend to our successor Finance Committee that subject committees should scrutinise the Scottish Government’s progress in that area.
I turn briefly to specific portfolio issues, and thank the subject committees for their detailed scrutiny and reports. The Finance Committee chose to examine certain portfolio issues in more detail, given their importance in assessing the Government’s budget against its core purpose and strategic priorities.
The committee considered the reductions facing further and higher education. We are awaiting the outcome of the Government’s green paper on higher education funding, but one issue that the committee raised is the commitment in the current budget to maintain core university and college places. It is not clear to us what is meant by “core”, therefore we ask the Government to spell it out.
I conclude by looking forward to the next parliamentary session, and turn to what we call in the report “legacy issues”, under which we discuss problems concerning the provision of budgetary information and the budget process itself. Although the committee has welcomed many aspects of Scotland performs, we have raised a series of issues regarding the provision of performance information and the perennial issue of linking budgets to spending priorities and outcomes. In previous reports, we have requested a formal report to Parliament. We note that under the Virginia performs system, on which the Scottish system is based, a report to the Virginia General Assembly is required. The committee therefore invites the Scottish Government to explain why it has not implemented a similar mechanism.
Finally, looking forward to the next session of Parliament, we recognise the difficulties that committees have experienced because of the time that has been available this year. However, having reviewed the process in 2008-09, we do not see the need for another review at this point. We will consider the issue further in our legacy paper and, with a view to helping our successors, I urge all committees to send us their thoughts on how the process can be improved.
Since this is my last annual Finance Committee report to Parliament as convener of the committee, I thank my committee colleagues, past and present, for ensuring that the overall interests of Parliament and the Scottish people—whom we serve—have been at the heart of our always unanimous reports and recommendations. I commend the Finance Committee’s report to the Parliament.
15:01
The key issue of efficiency savings has exercised the Finance Committee and our predecessors in sessions 1 and 2. There are many well-rehearsed issues around efficiency savings, including the problem with having year-on-year targets, which means that the easier options were taken some time ago and therefore future efficiencies are ever harder to find.
The major concern with efficiency savings throughout devolution has been the reliability of reporting information provided by public bodies. Reporting arrangements have yet to be set out for 2011-12. In our report, we call on the Government to explain how it will ensure that the test that the cabinet secretary has set out in relation to efficiency savings will be enforced. As a matter of urgency, we ask the cabinet secretary to set out clearly whether efficiencies for 2011-12 will be recycled or whether they will be used to reduce the funding gap.
The protection of the universal services that the Government provides formed part of our work during the budget strategy phase. Although we recognise that changing many of those services will have an effect only in the medium to long term, the report invites the Government to be more transparent in explaining the long-term impact on other aspects of the budget, especially given the pressures of demographic change.
We considered capital spending in depth, given the scale of the cuts in the capital budget and its importance in promoting economic growth. The committee agrees with public finance experts that investment in housing could have an immediate positive impact on economic growth.
Although the Finance Committee’s preventative spending inquiry proposals will be discussed in depth at our chamber event on 4 March, I want to put on record our strong support for the concept of preventative spending and our belief that more effective use of preventative spending could deliver great social and financial benefits to Scotland. The Scottish Government shares that view, claiming that preventative intervention
“lies at the heart of the Government’s policy interventions”—[Official Report, Finance Committee, 30 November 2010; c 2833.]
and is
“integral to the approach to government in Scotland and delivering the outcomes set out in the National Performance Framework”.
Given the strong consensus demonstrated by the committee, the Scottish Government and witnesses, we recommend that future draft budgets include an assessment of progress that is being made towards taking a more preventative approach. We will also recommend to our successor Finance Committee that subject committees should scrutinise the Scottish Government’s progress in that area.
I turn briefly to specific portfolio issues, and thank the subject committees for their detailed scrutiny and reports. The Finance Committee chose to examine certain portfolio issues in more detail, given their importance in assessing the Government’s budget against its core purpose and strategic priorities.
The committee considered the reductions facing further and higher education. We are awaiting the outcome of the Government’s green paper on higher education funding, but one issue that the committee raised is the commitment in the current budget to maintain core university and college places. It is not clear to us what is meant by “core”, therefore we ask the Government to spell it out.
I conclude by looking forward to the next parliamentary session, and turn to what we call in the report “legacy issues”, under which we discuss problems concerning the provision of budgetary information and the budget process itself. Although the committee has welcomed many aspects of Scotland performs, we have raised a series of issues regarding the provision of performance information and the perennial issue of linking budgets to spending priorities and outcomes. In previous reports, we have requested a formal report to Parliament. We note that under the Virginia performs system, on which the Scottish system is based, a report to the Virginia General Assembly is required. The committee therefore invites the Scottish Government to explain why it has not implemented a similar mechanism.
Finally, looking forward to the next session of Parliament, we recognise the difficulties that committees have experienced because of the time that has been available this year. However, having reviewed the process in 2008-09, we do not see the need for another review at this point. We will consider the issue further in our legacy paper and, with a view to helping our successors, I urge all committees to send us their thoughts on how the process can be improved.
Since this is my last annual Finance Committee report to Parliament as convener of the committee, I thank my committee colleagues, past and present, for ensuring that the overall interests of Parliament and the Scottish people—whom we serve—have been at the heart of our always unanimous reports and recommendations. I commend the Finance Committee’s report to the Parliament.
15:01
In the same item of business
The Presiding Officer (Alex Fergusson)
NPA
The next item of business is a debate on motion S3M-7771, in the name of John Swinney, on the Budget (Scotland) (No 5) Bill.14:35
The Cabinet Secretary for Finance and Sustainable Growth (John Swinney)
SNP
Last week, I introduced the 2011-12 budget bill, which I commend to the Parliament. The bill takes forward the draft budget that I set out in November.I welc...
Margo MacDonald (Lothians) (Ind)
Ind
The cabinet secretary will forgive me if I do not identify a source from which I hope that he will find enough money to help to pump prime an initiative that...
John Swinney
SNP
There have been constructive discussions between sportscotland and Midlothian Council about the situation at Hillend, and I hope that a positive outcome can ...
Rhoda Grant (Highlands and Islands) (Lab)
Lab
The cabinet secretary is aware that Argyll and Bute Council has a huge number of islands to cover. Why does it face one of the largest cuts in spending compa...
John Swinney
SNP
Argyll and Bute Council’s need to support islands will be covered by the special islands needs allowance, which is applied to all local authorities that have...
Jeremy Purvis (Tweeddale, Ettrick and Lauderdale) (LD)
LD
I seek clarification regarding the figures that the Government has published for the coming four years. Are those figures predicated on the 3 per cent effici...
John Swinney
SNP
The Government envisages that, for the longer term, an efficiency programme of 3 per cent will be essential to deal with the financial challenges that we fac...
Elaine Smith (Coatbridge and Chryston) (Lab)
Lab
Will the cabinet secretary take an intervention?
The Presiding Officer
NPA
No. I am afraid that the cabinet secretary is in the last minutes of his speech.
John Swinney
SNP
I will have to draw my remarks to a close now, although I will be happy to give way to Elaine Smith when winding up the debate.I will consider the Finance Co...
Mike Rumbles (West Aberdeenshire and Kincardine) (LD)
LD
On a point of order, Presiding Officer. It is on a procedural point. Could you make it absolutely clear that Parliament must not be misled? The cabinet secre...
The Presiding Officer
NPA
Order.
Mike Rumbles
LD
The correct procedure is for the Parliamentary Bureau to recommend to Parliament that it consider the regulations next week. That is for Parliament, not the ...
The Presiding Officer
NPA
That item will be on the agenda for next Tuesday’s bureau meeting and it will be duly discussed then.I call Andrew Welsh to speak on behalf of the Finance Co...
Andrew Welsh (Angus) (SNP)
SNP
Before I turn to the detail of our report and recommendations, I will briefly outline some of the changes to this year’s budget process.The fact that the UK ...
Margo MacDonald
Ind
Will the member give way?
Andrew Welsh
SNP
Forgive me, but I have a great deal to cover. The key issue of efficiency savings has exercised the Finance Committee and our predecessors in sessions 1 and ...
Andy Kerr (East Kilbride) (Lab)
Lab
I thank the convener of the Finance Committee for his report to the Parliament.However, from looking at the budget, I believe that the signal failure of near...
Margo MacDonald
Ind
Will the member give way?
Andy Kerr
Lab
I will not at the moment, thanks.In four years, Mr Swinney has brought forward four budgets. He has slashed the funding to enterprise, to energy and tourism,...
The Presiding Officer
NPA
Order.
Andy Kerr
Lab
The kids who are in schools that are decaying around them are not laughing, Mr Swinney. The people in our hospitals who require better care are not laughing,...
The Presiding Officer
NPA
Order. Can we have slightly better order, please, from the party in government?
Andy Kerr
Lab
Not in my words, but in the words of The Sun, the budget was described as “The great Swinney swindle”. He did not even have the ability to respond to all-par...
John Swinney
SNP
Would Mr Kerr like to comment on the competitive disadvantage that he was party to creating when he was a minister in the previous Administration, which kept...
Andy Kerr
Lab
We set about—Interruption.
The Presiding Officer
NPA
Order.
Andy Kerr
Lab
We set about creating parity. Perhaps the cabinet secretary will compare his actions today to his manifesto promise that rates in Scotland would not rise abo...
Derek Brownlee (South of Scotland) (Con)
Con
There are things in this budget with which we agree, such as the pay freeze on salaries of over £21,000, to protect jobs; the protection of the national heal...