Meeting of the Parliament 09 February 2012
This morning’s debate on the draft Local Government Finance (Scotland) Order 2012 has been interesting, although it has fluctuated at points between being a municipal hustings and a series of councillor retirement speeches.
I pick out Richard Lyle’s retirement speech. I hope that he gets another chance to speak in the chamber before he stands down as a councillor in May but, if he continues to demand more money for councillors, I suspect that Derek Mackay may try to block him.
Mr Swinney was not in the chamber when Richard Lyle described him as one of the best finance cabinet secretaries in recent years. I am sure that I picked the comment up correctly, but I would like to know who is ahead of Mr Swinney on the pile, if he is only one of the best.
I will pick up on some important points connected with the order and local government finance for next year and the coming years.
I turn first to the general resource grant. A number of times, SNP members made the point that, at 37.2 per cent, the local government share of spending will be higher in 2012-13 than it was when the SNP came to office. However, all parties—not only the Government—must focus on the direction of travel for local government in the spending review.
Yesterday, we voted on only the 2012-13 budget but, according to the spending review that was published in September last year, the cash that goes to local government for revenue, as opposed to capital, will decrease from £7.7 billion to £7.3 billion while, at the same time, the overall departmental expenditure limit resource budget will goes from £27.9 billion to £28.5 billion.
That, of course, could be subject to spring and autumn revisions but, in his closing speech, the minister ought to give us his analysis of the direction of travel for the local government budget over the next three or four years, given that its amount of cash is predicted to go down as the Scottish Government’s amount of cash increases. That suggests that the 37.2 per cent figure will inevitably drop. Will it, potentially, drop to below the level that it was at when the SNP came to office?
The Scottish Conservatives welcome the business rates incentivisation scheme. We had a similar policy a couple of years ago called the business dividend fund. However, my slight concern is that the targets have been set fairly high and there is a danger that, although the policy may look good on paper, only one or two—or, potentially, none—of the 32 local authorities will end up getting any money back through the scheme. I accept entirely that, if the bar is set too low, it will not incentivise people, but I am slightly concerned that it has been set particularly high, given the current climate. Is the Government willing to share its prediction for what each local authority will get through the scheme?
We have touched on the retail levy. I do not intend to dwell on it because, as the cabinet secretary said, the separate order relating to it has been laid before the Parliament today. Nevertheless, I return to Kenneth Gibson’s view that the levy will have no impact whatever on jobs. His justification for saying that was that Asda announced last week that it is creating some jobs, and he asserted that there is no evidence that the levy will have any impact. However, the Scottish Government has failed repeatedly to carry out a business impact assessment on the retail levy. That is not a difficult concept—it is Government policy to carry out such an assessment in relation to most orders and other legislation that it introduces. It has carried out impact assessments on many other orders that would have a much smaller impact on the economy. It is beyond belief that it has failed to carry out an impact assessment on the levy.