Seòmar agus comataidhean

That is a very fair question. The joint working group is working through the detail of what we will ask and how we will consult. The important point is that the process will not be optimal if we just send something out and see who responds to it. We could use networks of support. Local authorities have a lot of such networks, which will be in contact with the very people you are talking about—those who might be struggling with council tax arrears and debt. Through third-party organisations, there might be ways to elicit views that might not otherwise be given. We will take that point away and think about it further.

That is a really important question, and it is why talking to and engaging with the public at an early stage of the process is important. The last thing that we want is to end up with something that is viewed as doing something to the public, with us saying, “We have done this thing behind closed doors, and there it is—take it or leave it”. That is not what we want to do at all.

We want to have dialogue and, as Katie Hagmann said earlier, we want to have as long a reach as possible, so that it is not just about those self-selecting folk who regularly respond to consultations such as this. We want to have a greater reach than that and to spark genuine conversations.

There is a balance to be struck, because we do not want to go out and say, “Council tax: discuss.” We will have to frame the discussion around the type of things that are possible. We do not want to lead people up the garden path and into thinking that this will make changes that it cannot. We have to be clear and honest about the parameters, but we need to look for feedback and take that on board. That has to be the way that this lands. It is not about doing to people; it is about genuinely trying to make a system fairer and being really clear and up front about that.

Measures that could help to address policy areas that are very difficult for local government, such as the loss of homes in some areas of remote and rural Scotland to the holiday sector, have been prioritised. In some areas of remote and rural Scotland, nearly all of the homes are now second or holiday homes. The motivation behind the measures was to empower local government to do something about that; they are tools that local government can use. They can also raise revenue, which has been important. That dual policy objective has been quite successful, and there has been a large degree of consensus around it.

Any changes to some of the elements within council tax—for example, changes to the reduction scheme—need to be seen in the context of what we are doing more widely with council tax. We should look at reductions, but we need to maintain consensus. For example, I would be concerned about the removal of anyone’s discounts, because that would get us off on an entirely wrong and negative premise when consulting with the public. You do not want to consult on taking something away from somebody—that gets us in the wrong place straight away.

I am not saying that there is not a debate to be had on reductions, but, if we are to take people with us on that journey, we need to centre the policy in the right place.

The cost of living is probably primarily responsible for it, because, generally, debt rises in a cost of living crisis. People sometimes make a judgment to prioritise the bills that they think would result in more immediate pursuance.

I have often spoken to constituents who are in a difficult situation and they, rightly or wrongly, sometimes perceive the council tax as a debt that is not going to be immediately pursued, so they prioritise preventing power from being shut off and putting food on the table. People will make a judgment, which I suspect comes down to where council tax debt sits in a list of debts with which they are wrestling. That is my first point.

What we do about that is an issue, and the Scottish Government has been supporting a number of debt services. Local government is doing a lot of very good debt work in order to support people and make sure that they know about some of the discounts and what they are entitled to, because they sometimes do not know about council tax reduction support. It is important that people get support and that arrangements are made to enable them to repay in a sustainable way. I know that local authorities have been very proactive in doing that.

Best value is really important, and not just in local government. It is important that we are all able to show that every public service is striving to deliver the best outcomes with the resources that are available. I mentioned some of the ways in which I have seen local authorities giving more visibility to that. Best-value reviews are built into the Accounts Commission work, which gives the issue a kind of transparency.

As is always the case in all areas of public life, some local authorities are better than others at telling the story around those things and providing evidence and transparency. It is the same across all public services.

I am not going to rule anything out at this stage. First, we need to know what we are talking about, which is where the detail that Ellen Leaver mentioned, around who might need transitional additional support, comes in. We need to take it from there and break it down to look at who those people are, what their circumstances are and how we can support the position going forward.

We also have judgments to make about the overall system. Welsh colleagues were clear that one of the important things that they established from the start was that the process would be revenue neutral. I am very sympathetic to that position, because, if we say to the public that this is about making the system fair and that, in doing so, we recognise that some people will require transitional support—rather than it being a revenue-raising opportunity—that lands it in a different space. These things need to be discussed, but it is important that the purpose is set out clearly from the beginning. I would not dismiss some of those options, and the good thing about having detailed cross-party dialogue is that things might be suggested that could help to build a consensus.

There are things that we can learn from the Welsh experience. I had a good discussion with Mark Drakeford, who is now the Cabinet Secretary for Finance in the Welsh Government, at the bilateral meeting of finance ministers from across the UK. We talked about the progress that has been made in Wales.

Mark Drakeford had some reflections about things that perhaps they would have done differently—for example, the transitional arrangements were retrofitted after there was quite a hullabaloo about who lost out of the revaluation. There are lessons there; with any changes going forward, you would build in transitional arrangements right from the start that would give those changes a soft landing. Wales is also looking at further bands. We could look at how many additional bands might be required to make the Scottish system more progressive, and we could look at how the Welsh system works.

You could argue that it is down to how the political arithmetic has changed over the course of their Parliament and our Parliament. It has not been without its difficulties. When you look at the Welsh Government’s budget situation—securing its budget by one vote—I wonder whether, if it was trying to make some of those changes now, it would land in the same political environment that it did when it embarked on the consultation on revaluation. I am just surmising that opportunities for such changes will ebb and flow, depending on relationships and good will in Parliaments.

However, I repeat that we can take a lot of good evidence and lessons learned from the good aspects of how Wales did it, but there are also things that it would say in hindsight that it might have done differently.

That is a fair challenge. Part of the concern, perhaps, was about what would come out of the end of that—whether it would give us anything new without some political consensus having been built in advance.

The public element of consultation can take many forms. As long as it is there, and as long as it is local and led by local government, I am not sure that it necessarily requires to be in a particular format, whether that is a citizens assembly or anything else. It is a matter of ensuring that it is done in a way that gives us the same level of engagement with the public.

Why was that not done more quickly? It was probably because there was a bit of scepticism about whether anything arising from the event would change things and move us forward. I have therefore taken the position that we now need to get things in the right order to build political consensus and land changes in an environment that means that they will actually happen, rather than our debating the future of the council tax and replacing it with something that no one will agree on, which would be my worry.

That is my honest reflection on why we have probably not made the progress that we would have liked to make since 2021.

I want to avoid that. You make a fair challenge. If we were to go out and say, “Council tax: discuss,” that is exactly where we would probably end up.

The joint working group and COSLA leaders have still to narrow down the content of the engagement activity before going out to the public. It would be interesting to hear views from the committee on this. How, specifically, do we make the system more progressive? What do people think about additional bands? What do people think about transitional arrangements? We could begin to get into questions of what the system might be, rather than just saying, “Council tax: discuss.” That does not mean that the process is so narrow that it becomes one of saying, “This is your choice. Take it or leave it.” There is a balance to be struck. People need to get the sense that something could emerge at the end that will help with manifesto setting and a landing space that could be progressed in the next session of Parliament, from which people would see a tangible outcome.

I share your worry about where we could end up if the process is too broad. We do not want that, and I think that the public expects to know where the political consensus might be. Without that, legislation will go nowhere. There has to be a reality check, which should inform our thinking about what goes out to the public.

Katie Hagmann may want to add more.

First, I think that a lot of good work was carried out through the 2015 commission. Although the commission did not recommend any specific form of taxation to replace the council tax, it unpacked a lot of issues. The commission expressed a predominant view that local tax should continue to include some sort of domestic property tax, with a new system that was more progressive than the council tax.

The issue then is probably still the issue now—it is about getting consensus. That is why I have been pretty up front and honest in saying that I do not think that we will be able to move forward unless we can build enough consensus, not just in relation to identifying the problem but about what to do next. Everybody will agree that 1991 property values are out of date and that something needs to be done about that and everybody will agree that the current council tax system is not as progressive as it should be and that it needs to be improved, but the difficulty will be to agree on what should come next to make improvements.

I am quite optimistic that we can genuinely build some consensus around the principles that we agree on. There will be a lot that we disagree on, but there are areas that we can agree on where we could begin to make some changes. It might not be about having a massive big-bang replacement for the council tax, but I hope that we can find areas of agreement so that we can take incremental steps to address some of the issues, such as progressivity. It remains to be seen where we get but in essence, that is what Katie Hagmann and I are keen to do.