Hansard

This has been a worthwhile debate that has been useful in highlighting some of the challenges that this Parliament faces in revising our processes following the devolution of significant new powers.

Before I summarise some of the excellent speeches that we have heard, I want to focus briefly on two issues. First, I want to comment on the need for some level of scenario planning to be published to support parliamentary scrutiny in advance of the publication of the draft budget; and, secondly, I will return briefly to some of the complexities of the challenge, which the convener mentioned in his thoughtful opening speech.

Members of the Finance Committee made it quite clear at our meeting on 7 September that, in agreeing to the draft budget being published after the UK autumn statement, some level of scenario planning would need to be provided prior to that. The cabinet secretary responded:

“I am willing to produce as much scenario planning information as I can.”—[Official Report, Finance Committee, 7 September 2016; c 16.]

The committee therefore finds it unacceptable that the cabinet secretary has gone on to say that he is not prepared to publish any such scenario planning. During the minister’s closing remarks, we heard a further extension of that form of words. Unfortunately, I believe that it will take some time to work out exactly what has been offered and what the outcome of that is likely to be. The committee considers that, without such information, it is unlikely that there will be sufficient opportunity for the subject committees to scrutinise the Government’s spending proposals.

I turn briefly to how we will address the complexities of the budget process in future years. As we have heard, the budget process review group will have the unenviable task of unravelling these complexities and designing a new process that meets the Government’s emphasis on accuracy and the Parliament’s emphasis on robust scrutiny. I am sure that that will involve a number of trade-offs and, in all probability, an element of compromise on all sides.

There are a number of issues that the committee has raised with the Scottish Government and which the review group is likely to consider. The first of those issues is data sharing. The fiscal framework makes it clear that the Scottish Government and the Scottish Fiscal Commission should

“have access to the necessary data, information and models held by the UK Government to support policy development and produce forecasts of a comparable quality to those produced by the OBR.”

That raises issues of timing and transparency. It is essential that data is made available timeously in order to maximise the time that is available for parliamentary scrutiny and that that data is published in a way that recognises the need for taxpayer confidentiality.

The second issue concerns levels of budgetary information. One of the benefits of budget scrutiny is that it has led to much greater levels of transparency in the budgetary information that is provided by the Scottish Government. The level of information that is provided regarding the operation of the fiscal framework will be vital in ensuring effective scrutiny, especially in relation to the calculation of the adjustments to the block grant; the methodology and assumptions that are used to calculate forecast tax receipts; the reconciliation process; and the use of the new borrowing powers, including the operation of the Scotland reserve.

The third issue concerns the timing of the publication of the draft budget. The committee has indicated that the reasons that are set out in the cabinet secretary’s letter of 23 June—which predates the Brexit result—would not have been sufficient to justify delaying the publication of the draft budget until after the autumn statement. One of the key challenges of the budget review group will be identifying an optimum time for the publication of the draft budget that can address both the relative accuracy of the numbers and the time that is available for scrutiny.

The final issue is the fact that the review of the budget process offers a real opportunity to improve financial scrutiny. In particular, the committee is keen to develop the move towards a more outcomes-based approach to budget scrutiny, which our predecessor committee began during the last session. That should involve much more scrutiny of the impact and effectiveness of how public bodies are spending public money before considering how it should be spent in future years. It should also result in an all-year-round approach to financial scrutiny and far better linkage between the audit and budgetary functions. However, the committee has made it clear that that new approach should not be viewed as a replacement for scrutiny of the draft budget document.

As I approach the end of my speech, it is appropriate for me to comment on some of the things that have been said during the debate. Some members—perhaps out of frustration—strayed into discussing the budget itself. Given today’s notification that publication of the draft budget is still some 10 weeks away, that frustration is understandable.

Other members chose to demonstrate the level of tolerance that the committee has shown towards the cabinet secretary. Patrick Harvie, in particular, set out the fact that the committee and the Parliament have much to be concerned about. In the simplest terms, the committee has offered the cabinet secretary a compromise, and it appears—at the moment, at least—that the cabinet secretary has not yet accepted that compromise. As we go forward, it is vital to understand that, if a compromise is possible, it must be reached quickly, because the worst possible outcome would be for the present stand-off to continue until 15 December and for the draft budget to be published with our having made no progress in advance.