Covid-19 Recovery and Parliamentary Business
Good afternoon. The first item of business is portfolio question time, and the first portfolio is Covid-19 and parliamentary business.
I remind members that questions 5 and 7 have been grouped together, so I will take supplementaries on those questions after both have been answered. Members who wish to ask a supplementary should press their request-to-speak button during the relevant question. I advise the chamber that there is an awful lot of interest in asking supplementaries, so, if we can have questions that are devoid of lengthy preambles and answers that are as brief as possible, we will get through them all the more quickly.
Covid-19 Recovery (Assessment of Policies)
I will try to set a good example for once, Presiding Officer.
To ask the Scottish Government what assessment it has made, as part of its cross-Government co-ordination of Covid recovery policies, of the wider on-going impact of Covid-19, including on the economy. (S6O-01868)
The Covid recovery strategy brings together more than 70 actions that are supporting those who have been most impacted during the pandemic and the on-going cost crisis by increasing financial security for low-income households, enhancing the wellbeing of children and young people, and creating good, green jobs and fair work.
That activity is supported by the themes of the Scottish Government’s national strategy for economic transformation and by work that involves support for digital recovery and support for the energy sector through the energy transition fund. We are also providing significant investment to support businesses, including by providing almost £0.5 billion pounds more than the funding that we received from the United Kingdom Government.
I ask, with specific reference to my constituency, whether we have any data on the impact on the economies of Midlothian and the Borders. If the Deputy First Minister does not have that to hand, will he please write and provide me with it?
I am very happy to draw out as much detailed information as I can in a follow-up response to Christine Grahame. However, in relation to some key indicators, we have historically low unemployment and historically high employment levels across Scotland. Those factors will be felt acutely in areas such as the Borders and, in particular, in Midlothian, where there is such strong accessibility to labour markets. I will look to see what more detailed information I can provide to the member.
We have a few brief supplementaries.
One of the economic impacts of Covid has been the acceleration in the decline of traditional retail centres. Just this week, we have seen the closure of M&Co stores across Scotland, which will contribute to that. Has the Scottish Government done any assessment of the impact on traditional town and city centres of the expansion of working from home across the public sector?
Obviously, town centres and the retail community will be affected by a range of different factors. Covid and the impact of lockdown will be one, the move towards the greater use of online retail opportunities will be another, and a third will undoubtedly be the impact of proportionally more people working at home since the pandemic than before the pandemic.
The Government is actively undertaking work to look at the impact on town centres, and parliamentary committees have reported on the subject. All those different factors are researched and are reflected in the thinking that the Government brings together in its retail strategy.
One of the major legacies of the Covid pandemic in Scotland has been its impact on mental health. What is the Deputy First Minister’s response to reports that there were no mental health beds available in Scotland last weekend? What steps is the Government taking to honour its pledge to increase spending on mental health to 10 per cent of the total national health service budget, given that funding for the coming financial year has been frozen?
The mental health budget has increased, and we have greater capacity to support individuals in order to assist in their recovery. The Government is taking a variety of other steps to enhance community mental health resources in our society; assistance to school communities is an example that comes to mind. The Government will endeavour, where the resources allow, to expand the investment in mental health and wellbeing services, as it recognises the importance of supporting people in their recovery.
Covid-19 Inquiry (Update)
To ask the Scottish Government whether it will provide an update on the Scottish Covid-19 inquiry. (S6O-01869)
As an independent public inquiry, it is for the Scottish Covid-19 inquiry to comment on its work as it progresses, including through its website: covid19inquiry.scot. In its role as sponsor, the Scottish Government remains committed to providing operational support, as the chair considers appropriate and necessary, in order to enable the inquiry to carry out its independent work and to ensure that the progress that has been made so far is continued. We want the inquiry to be delivered at speed, addressing the range of questions that people have, so that we can learn and benefit from any lessons as early as possible.
It has been reported recently that the former chair of the Scottish Covid-19 inquiry, Lady Poole, raised several issues with the inquiry before her resignation and that the Deputy First Minister personally offered to make a phone call to try to get her to change her mind, although she declined to do so. It appears that numerous issues with the inquiry were piling up and that Lady Poole felt that she had no option but to step down. Why did the Deputy First Minister let those problems build up to the point of resignation, rather than addressing them at an earlier stage? Given that millions of pounds of taxpayers’ money have already been spent on the inquiry, what lessons have been learned to ensure that the same issues, delays and costs do not arise in the future?
Mr Halcro Johnston’s question raises a perspective on an independent public inquiry that must be countered. Conservative members would be outraged if I were to interfere in the operation of an independent public inquiry. Indeed, Mr Fraser, who is sitting on the front bench, accused me of so doing. We have one member of the Conservative Party, Mr Halcro Johnston, asking me to interfere in an inquiry and another Conservative member, Mr Fraser, alleging that I am already doing just that.
The law is very clear on independent public inquiries, and I have rehearsed the point in previous parliamentary statements. The law is clear that, once a chair is appointed, it is up to them to run the public inquiry and it is not for ministers to interfere. I do not interfere.
Covid-19 Recovery (Assessment of Policies)
To ask the Scottish Government what cross-Government assessment it has made of the impact of its Covid recovery policies, including whether any might continue into the future. (S6O-01870)
The Covid-19 recovery strategy contains a range of actions, many of which will continue beyond the lifetime of the strategy. The principles of the Covid-19 recovery strategy helped to inform the 2023-24 Scottish budget, which prioritises eradicating child poverty, transforming the economy to deliver a just transition to net zero and achieving fiscally sustainable public services. The Scottish Government will continue to prioritise policies that support those who are in the most need.
I co-chair the Covid-19 recovery strategy programme board, alongside the president of the Convention of Scottish Local Authorities. Together with partners, we oversee recovery activity that supports people in Scotland, particularly those who are most affected by the pandemic and the on-going cost crisis.
I thank the Deputy First Minister for that answer, which provided a useful contrast to the earlier question.
The Deputy First Minister will be aware of some of the more positive outcomes from Covid, such as the digital transformation of the workplace—and the Parliament—and local project initiatives that initially emerged as emergency support, but which have become an important part of local community work not only in my constituency but in the impressive work of Engage Renfrewshire, which the Local Government, Housing and Planning Committee saw on Monday.
Does the Deputy First Minister share my view that those positive developments, born out of Covid, are making a real difference to people and communities? Will he consider retaining funding models for important community work in the future, rather than allowing that work to be lost simply because the Covid funding has come to an end?
There is a lot of merit in the points raised by Mr Coffey. We saw tremendous development in innovative community practice during Covid, whereby solutions were found by communities for individuals. The Government is intent on encouraging and nurturing that approach.
It is important that we are on our guard against a return to old ways of working. Some of the new ways of working that were developed during Covid have been of great benefit and advantage to our society and our communities. We want to ensure that we preserve those. I assure Mr Coffey that the Government is trying to design its funding interventions, particularly for measures such as the Dundee pathfinder work, to do exactly that.
Last week, I met Unite the union and concerned employees from the Glasgow Lighthouse lab to discuss the future of the facility, in the light of concerns about further redundancies in the coming weeks. The cabinet secretary will be aware that the lab, which is Scotland’s flagship Covid-19 testing facility, processed more than 26 million tests but has already lost experienced and highly skilled employees, including sample handlers and lab technicians, in a previous round of redundancies.
Will the cabinet secretary outline what meetings the Scottish Government has had with the University of Glasgow regarding the future of the Glasgow Lighthouse lab? Given that Covid has not gone away, will he intervene to ensure that that important capacity is retained?
From the budget discussions that we had at the COVID-19 Recovery Committee, Jackie Baillie will be aware that the Government is retaining enhanced testing facilities beyond those that we had prior to the Covid pandemic, to ensure that we have the capability and capacity to undertake testing activity.
I will inquire about specific dialogue between health ministers and the University of Glasgow in relation to the Lighthouse lab, but Jackie Baillie should be assured of the Government’s commitment to ensuring that we have the appropriate measures in place to deal with the Covid pandemic. The pandemic is, of course, still with us, but its prevalence is, thankfully, much lower than has been the case in the past, and we have much greater population protection through the vaccination programme.
Covid-19 Recovery (2023-24 Budget Allocation)
To ask the Scottish Government how it plans to spend the proposed Covid recovery portfolio 2023-24 budget allocation. (S6O-01871)
The Covid recovery portfolio supports the Scottish Government’s commitment to renewing public services through public service reform, the delivery of the Covid recovery strategy—which is supporting those who have been most impacted during the pandemic and on-going cost crisis—and its contributions to the co-ordination of recovery activity across the Scottish Government.
As detailed in the 2023-24 budget statement, the budget line includes a range of commitments, including work to support the operation of the Scottish public inquiry into the handling of Covid-19 and work on preparedness, assessment and co-ordination of concurrent risks across the Scottish Government.
On a related issue, at the end of last year, the letter that Richard McCallum, the Scottish Government’s director of health finance and governance, sent to integration joint boards caused considerable concern that a total of £331 million of Covid money across IJBs would be clawed back by the Scottish Government. The Scottish Government said that that money
“is being used to fund Covid pressures across the”
health
“sector and for no other purpose.”
Can we get some clarity on exactly what that money is being spent on?
It is pretty obvious that the budget is under enormous financial pressure. Liz Smith is a member of the Finance and Public Administration Committee, and I have been completely candid about the challenges that I face in balancing this year’s budget because of the impact of inflation and the increased costs with which we are wrestling. I have come to Parliament to reallocate £1.2 billion of resources to meet the funding pressures. It is no secret that we face those issues and pressures, but the Government is acting to address them.
In relation to IJB funding, it is elementary common sense that, if IJBs hold reserves that can be utilised to support front-line activity, that is the Government’s clear preference.
Given the pressures that are faced by unpaid carers—one of the groups who have been most adversely affected by the pandemic—not least due to rising energy bills, as has been articulated in the chamber during First Minister’s question time, as well as their needs in the recovery phase, what does the Deputy First Minister intend to do to support them through the Covid recovery budget, not least in relation to testing, antivirals and personal protective equipment?
As Mr O’Kane might be aware, there is provision in the health budget for the maintenance of pandemic preparedness in relation to many of the issues that he raises, such as PPE and testing arrangements, as I rehearsed in my answer to Jackie Baillie. That provision has been made on a prudential basis. We all hope that we will not need to increase the scale of investment that is required in that regard, but there is provision in the budget to enable that to happen. Support would be available to those who required it, and I imagine that, in many cases, carers would be eligible for that support.
Covid-19 Recovery (Long Covid Data Collection)
To ask the Scottish Government how its cross-Government co-ordination of Covid recovery policies is supporting data collection to assess the impact of long Covid. (S6O-01872)
The Scottish Government is committed to delivering a fair recovery for everyone in Scotland, particularly the people who have been most affected by the pandemic, which includes those affected by long Covid.
We are supporting activity to improve the collection of clinical data on the prevalence and healthcare needs of people with long Covid to inform the planning and delivery of services. Officials are working with NHS National Services Scotland’s long Covid strategic network to improve data collection as a priority. The network is taking forward a dedicated workstream to agree outcomes, indicators, monitoring and evaluation to accelerate progress.
In August, the Cabinet Secretary for Health and Social Care said in a parliamentary answer to me that the number of people diagnosed with long Covid in Scotland was
“a matter for the NHS Boards. The information requested is not held centrally.”
In the same answer, he said that the Government recognised
“that accurate data on the number of people diagnosed with long COVID is needed to forecast and plan for ... healthcare services arising from long COVID.”
Does the Cabinet Secretary for Covid Recovery—who is the Deputy First Minister, the minister in charge of statistics and the minister in charge of Government strategy—agree with the Cabinet Secretary for Health and Social Care that that is
“a matter for the NHS Boards”—[Written Answers, 24 August 2022; S6W-10046.]
or does he recognise the benefit of the Scottish Government collecting the data, publishing the data and keeping an accurate record of that data to plan and properly resource nationally the vital services that long Covid sufferers so desperately need?
I would make two points in relation to Mr Leonard’s question. First, I reiterate what I said in my original answer. Work is under way with NHS National Services Scotland’s long Covid strategic network to improve data collection. That substantively addresses the point that Mr Leonard puts to me.
Secondly, in relation to support for people with long Covid, the Government is very clear that we must ensure that anybody who is experiencing ill health, whether that is from long Covid or anything else, is able to access the appropriate level of clinical care to support their needs and requirements. That is primarily undertaken through access to the general practitioner network in Scotland. I would encourage anybody who is experiencing ill health to pursue those options and to ensure that they secure the necessary care to which they are entitled.
Covid-19 Recovery (Impact of Long Covid)
To ask the Scottish Government what discussions it has had as part of its cross-Government co-ordination of Covid recovery policies regarding the wider impact of long Covid, including on the economy and workforce. (S6O-01874)
The Scottish Government recognises the impact that long Covid can have on the health and wellbeing of the people who are affected, including on their ability to stay in employment. Although there have been increases in the numbers of people who are economically inactive due to sickness since before the pandemic, the extent to which that is attributable solely to long Covid is not yet clear.
We are investing in scientific efforts to understand and treat long Covid, and we have made funding available to national health service boards and partners to deliver the best local models of care for assessment, diagnostic tests and support for the on-going management or treatment of symptoms.
Through our fair work agenda, we are also supporting employers and explaining to them how they can support workers who are living with long Covid to remain in employment.
I am concerned that people with long Covid will find themselves locked out of employment if they are not given adequate support to return to work. That is especially true if the person’s job cannot be done from home, which is the case for nurses, for example. What is the Government strategy to help to ensure that people working in our NHS who are suffering from long Covid are supported to return to work where possible and, if they cannot return to work, to ensure that other options are explored to help them to stay in employment?
We have a priority across the whole of Government to maximise the available level of participation in the labour market. We want to maximise the number of people who are available to actively contribute to the labour market.
As I said in my earlier response to Christine Grahame, we have low levels of unemployment and high levels of employment, and the labour market is tight. Therefore, we are encouraging people who have long Covid to return to work, and all the necessary clinical support, mental wellbeing support and any other assistance that is required should be available to them. If there is a case for individuals to find alternative employment, we should be open to providing the training and skills enhancement activity that will support them in making the transition.
Parliamentary Reform (Debating Time)
To ask the Scottish Government what plans it has to propose time for a debate in the Parliament on parliamentary reform. (S6O-01873)
I thank Mr Kerr for his question. The Scottish Parliament is responsible for all matters relating to its functions and internal operation. The Government would encourage any member wishing to propose reform of current parliamentary procedures to raise such proposals with the Standards, Procedures and Public Appointments Committee. The Government stands ready, if invited, to discuss any reform proposals with the Parliament.
The minister did not answer my question. I asked whether there was time for a debate. The minister will be aware that there is a clear desire and appetite from members across the chamber to see our Parliament reformed. It is also apparent that there is scope for common ground on reform among colleagues in all parties in this Parliament. We all want the Scottish Parliament to effectively fulfil its appointed role in its function as a legislature and in its day-to-day scrutiny of the Executive.
Therefore, will the minister, on behalf of the Government, confirm to members that he and his ministerial colleagues will be supportive of such reforms that might be initiated by the Standards, Procedures and Public Appointments Committee and engage positively with all interested parties, including my colleague Donald Cameron, to secure such reforms as might be determined to be needed to enable the Parliament to be effective in carrying out the business of the people of Scotland?
As always, Mr Kerr and I seem to have a communication problem. I will say it again: the Scottish Government stands ready, if invited, to discuss any reform proposals with the Parliament. As always, he mentions Donald Cameron. Once again, when Donald Cameron asked about that in the chamber on 18 January, I said that, although I did not agree with Mr Cameron’s summation of the situation, I was happy to meet him to discuss it further. That meeting is scheduled for 2 March. As always, the Government is willing to engage with anyone.
Martin Whitfield has a brief supplementary question.
It is right that decisions about parliamentary reform sit in this chamber and with the Parliament instead of with the Scottish Government. However, would the Scottish Government co-operate with committees and the Parliament on any inquiries relating to reform of parliamentary procedure?
As always, I am happy to engage with the Standards, Procedures and Public Appointments Committee. I have done that on numerous occasions, including with Mr Whitfield as the convener. We will happily get involved in any future work that the committee should bring to us. As with any other member of this Parliament, we will look at it and take it from there.
Bill Kidd has a brief supplementary question.
The minister will be aware of the Delegated Powers and Law Reform Committee’s report on the Retained EU Law (Revocation and Reform) Bill, in which concerns were raised about the amount of time that is available for the Scottish Parliament to scrutinise elements of the bill. Does the minister have any concerns about the time that is available to give adequate scrutiny to the bill?
Please be very brief, minister.
The member will be aware that we discussed that question at the DPLR committee meeting yesterday. The Scottish Government is taking forward work to identify retained European Union law so that it can be preserved before the end of 2023. At this stage, it is too early to know what the impact will be on the wider legislative programme, but that is being kept under review.
Covid-19 Recovery Strategy (Support for Students)
Presiding Officer, I apologise that I did not arrive until portfolio question time was starting.
To ask the Scottish Government what steps it is taking through its Covid recovery strategy to support students. (S6O-01875)
The Covid recovery strategy is focused on reducing systemic inequalities, tackling poverty and supporting the people who were most affected during the pandemic. That includes a range of actions to support and enhance the wellbeing of all children and young people, including through investing a further £45 million in our young person’s guarantee in 2022-23. Further detail on the support that is being provided to students is set out in our coronavirus education recovery strategy, which describes a range of advice, guidance and funding that is provided with regard to mental health, wellbeing and tackling digital poverty.
In the Covid-19 recovery strategy, the Scottish Government states that it recognises the significant cost of rent for many households. A recent report commissioned by the National Union of Students has found that rents for student accommodation increased by 34 per cent between 2018 and 2021. Will the cabinet secretary commit to reinstating the rent freeze for student accommodation until a permanent system of rent controls is put in place?
I certainly cannot commit to that this afternoon. That is quite a big undertaking to give. I will take away the issues that Katy Clark has raised. The Government has taken measures, which have been properly considered by the Parliament, to apply a freeze on rents. As Katy Clark will know, legislative provisions are under way. I will certainly take away the point that she has raised and ensure that it is considered by the relevant ministers.
I welcome the support set out for students during the cost of living crisis, which I know is weighing heavily on their minds. Will the Deputy First Minister provide an update on the mental health and wellbeing support that is available to students?
We have supported the National Union of Students’ think positive initiative, which signposts students to places where they can get help. Through student mental health agreements, student associations and institutions can work jointly on mental health practices.
There is work under way on the strategic delivery of that work, which is being taken forward by a working group chaired by the Minister for Higher Education and Further Education, Youth Employment and Training, and which is determined to ensure that we have the necessary steps in place to protect the mental wellbeing of young people and students.
Finance and the Economy
The next portfolio is finance and the economy. I remind members that questions 6 and 7 are grouped together and that I will take supplementaries on those questions after both have been answered. I make the usual request that, if somebody wants to ask a supplementary question, they should press their request-to-speak button during the relevant question. Again, there is a lot of interest in this portfolio, so I would appreciate the same brevity in questions and responses.
Superfast Broadband (Update)
To ask the Scottish Government whether it will provide an update on its commitment to deliver superfast broadband to 100 per cent of premises in Scotland by 2021. (S6O-01876)
As at 31 December 2021, all homes and business across Scotland had the ability to access a superfast broadband connection through one of the three strands of activity that make up the R100—reaching 100 per cent—programme: the £600 million R100 contracts, the demand-led R100 Scottish broadband voucher scheme and commercial coverage.
By the end of December 2022, the R100 contracts had built connections to more than 16,600 properties across the length and breadth of Scotland, with more than 2,800 connections also delivered through R100 vouchers.
The minister must think that I am zipped up the back if he expects me to believe that answer. It was not delivered by the end of 2021. I personally do not have superfast broadband in my house—and I am not alone. Hundreds of thousands of other people across Scotland do not have superfast broadband either, and therefore it is not at 100 per cent. A new freedom of information release found that it will not be delivered until March 2028—almost seven years late. Why is the minister insisting that he has met the election promise when he clearly has not?
As I indicated in my previous answer, the voucher scheme was put in place to ensure that anyone who wanted to connect as at that date was able to do so. We continue to roll out the programme as planned, with a commitment of £600 million to support that. We have to bear in mind, of course, that telecoms provision is a reserved matter, but the Scottish Government recognises its importance to communities, businesses and families across Scotland—hence our commitment to spend that additional £600 million to roll out the programme.
Can the minister provide any update regarding the Scottish Government’s latest engagement with the United Kingdom Government regarding the funding available to deliver its project gigabit commitment?
The Scottish Government continues to work closely with the United Kingdom Government to shape what project gigabit will look like in Scotland. To date, we have secured £28.5 million of funding, which is being used to enhance and extend R100 contract coverage across rural Scotland.
The UK Government has not provided a Scotland-wide allocation of project gigabit funding that would allow things to move forward at maximum pace. We should also recognise that that £28.5 million is out of a total of £1.2 billion confirmed by the UK Government, which is out of a total of £5 billion that it originally committed to that programme.
In the weeks ahead, we will engage with broadband infrastructure providers to understand their current and future gigabit delivery plans and to gauge their level of interest in bidding for new broadband contracts in Scotland. It is vital that the UK Government commits a level of funding that will extend gigabit connectivity to Scotland’s rural and island communities, as well as urban and semi-urban areas, to ensure that no one is left behind.
In the past week or so, a damaged cable led to broadband outages in some communities in Orkney and the north of Caithness, and that follows damage to two cables in October, which left shortages in Shetland. What discussions are taking place with network providers to reduce the potential for disruption and to increase network resilience?
We are engaged in discussions to ensure that there is as much resilience as possible in the system and that such outages are protected against. Clearly, there is the possibility that freak incidents will occur, but we have put in place subsea cables to extend coverage and the work that is being done on connectivity and ensuring that there is resilience across the system will continue.
Greater Glasgow and Clyde (Investment)
To ask the Scottish Government what assessment it has made of the impact of investment levels on the status of the greater Glasgow and Clyde area, including how this compares to similar city regions across the United Kingdom. (S6O-01877)
As part of the consultation process for the national strategy for economic transformation, the Scottish Government received information on every region in Scotland. That information shows a varied landscape with a number of economic strengths, from clean growth to aerospace.
As Pauline McNeill will be aware, the Scottish Government is investing £500 million in the Glasgow city region deal, which aims to lever in an estimated £3.3 billion of private sector investment to support the delivery of projects, to work with 4,000 individuals and to help at least 600 employment and support allowance claimants into sustained work. We are committed to spreading the benefits of economic growth across the Glasgow city region and to ensuring that deprived areas benefit from that growth.
I put on record the fact that I welcome that investment. However, the Scottish Government does not seem to recognise that Glasgow has an economy that is underperforming in relation to the European average for growth and productivity, and that it has a smaller voice in the British and Scottish growth debates than a city of its stature—the largest city in Scotland—should have.
Yesterday, I raised the fact that the decision not to accept the Clyde green freeport bid was an extremely significant blow to Glasgow, which I do not think has been recognised by the Scottish Government. Stuart Patrick, chief executive of the Glasgow Chamber of Commerce, said:
“Overlooking Scotland’s entire west coast risks making both the UK Government’s Levelling Up strategy and delivery of the Scottish Government’s commitment to a Clyde Mission extremely challenging.”
What does the minister have to say in response? What plans does the Scottish Government have to ensure that Glasgow, as one of the big four UK cities outside London and the most locked-down city in the whole of the UK during the pandemic, is not left behind?
I assure the member that the Scottish Government absolutely supports Glasgow city’s, and the wider region’s, aspirations. In looking at some of the funding awards that have been made in the past few weeks alone, I see that Glasgow—including the Govan graving docks, which have lain empty for 40 years—has benefited from the vacant and derelict land investment programme. The Government’s recycling improvement fund has made awards to some exciting projects in Glasgow. In addition, the regeneration capital grant fund has made awards to projects in Glasgow, including for the transformation of a former pipe factory into a community centre and creative hub for young people.
That is to name just a few of the awards that have gone to Glasgow and the surrounding region in the past few weeks alone. That is in contrast to what we have seen from the UK Government, with the levelling up fund being an absolute damp squib and failing Glasgow, the wider city region and the rest of Scotland.
I assure Pauline McNeill that the Scottish Government will continue to support Glasgow’s aspirations.
The minister mentioned the city deal. Can he say more about the city deal? Does it compensate for the levelling up money that we lost?
As John Mason knows, the deal empowers Glasgow and the region to identify, manage and deliver a programme of investment to stimulate economic growth and create jobs in the area. That funding is issued twice per year, using the agreed governance arrangements, whereby funding is distributed to projects according to the wishes of all eight local authorities across the region. One such example is the bridge over the M8, which is due to open soon and which forms an active travel route linking Sighthill and the city centre. It is part of the £0.25 billion regeneration project for Sighthill, which will improve the economic flow between all those areas. That is just one example.
As to whether the city deal compensates for the levelling up money that was lost, as I said yesterday to Parliament, many parts of Scotland, including areas that are most in need, such as many areas of Glasgow, have been completely ignored and have not received a penny of the £3.8 billion that the UK Government has allocated for levelling up across the UK.
Question 3 was not lodged.
Business Activity
To ask the Scottish Government what it is doing to encourage business activity in Scotland. (S6O-01879)
We know that businesses in Scotland are struggling because of Brexit and the Tory Government’s economic mismanagement, and that is why the Scottish Government is providing, through our limited levers, immediate support, including the lowest non-domestic rates poundage in the United Kingdom. [Interruption.]
At the same time, we are delivering our national strategy for economic transformation to achieve our long-term ambitions for a stronger, fairer and greener economy. The strategy’s programmes focus on stimulating entrepreneurship, opening new markets, increasing productivity, developing the skills that we need, and ensuring fairer and more equal economic opportunities. We are working closely with delivery partners, businesses, the third sector and trade unions to successfully implement the strategy.
Businesses across Scotland have raised significant concerns regarding the Scottish National Party-Green Government’s roll-out of a deposit return scheme, calling it “completely unworkable”, “negative” and “complicated”. It will put jobs at risk, add a massive burden to businesses at a time when they need support, and discourage business. Stakeholders are clear that the plans are poorly thought through, and the Scottish Government is not giving enough attention to those concerns.
Will the Scottish Government listen to businesses and commit to launching the scheme only once businesses have had the answers that they desperately need?
We are very conscious of the need to engage with businesses, which is why we have such an extensive programme of engaging with, listening to and responding to the needs of business. It is also why I am chairing the regulatory joint task force, which was set up by the Deputy First Minister. In the past few weeks, the task force has had two meetings, and it is working closely with the business community to assess the impact of regulations, make sure that business regulation impact assessments are doing their job and ensure that we address the impact of different regulations on the business community.
We are focused on listening to and working with business to make sure that the regulations that my colleague Lorna Slater is taking forward on the deposit return scheme, and all other regulations that the Government introduces that impact on business, are properly assessed. We listen to businesses to make sure that their views and concerns about those regulations are taken into account.
I remind colleagues that we listen with respect to not only questions but the answers that are given to those questions.
On Friday, many of us took part in the successful business in Parliament event, which was hosted jointly by the Economy and Fair Work Committee and the Scottish Government. Will the minister join me in thanking Parliament and Government staff who made it possible for the 250 delegates from business and MSPs to come together to have frank but positive discussions about the issues faced by businesses across Scotland?
I took part in the business in Parliament conference myself and was hugely impressed by the contributions that were made by a wide range of businesses in the plenary sessions and the workshop in which I took part. I thank the Parliament staff and others who were involved in putting on the event.
The conference is one of a range of events that the Government takes part in to ensure that we are working with, listening to and reflecting on the concerns of business. We are hearing from a wide range of businesses across all sectors in Scotland to make sure that we work together to build and strengthen Scotland’s economy.
United Kingdom Economy (International Monetary Fund Analysis)
To ask the Scottish Government what assessment it has made of the potential impact in Scotland of the recent analysis by the International Monetary Fund, which found that the United Kingdom economy is set to shrink by 0.6 per cent in 2023. (S6O-01880)
As was set out in the Scottish Government’s recent monthly economic brief, the Scottish economy is facing a challenging outlook. As the IMF projection shows, a lot of that challenge is down to the UK Government’s economic mismanagement.
The IMF also highlights that labour market shortages are affecting Scotland and the UK more than other countries. They have been made worse by Brexit, which continues to hold back our economy and make it harder for Scotland to deliver fairer and more sustainable economic growth.
It is now more than three years since the UK left the European Union. Despite all the promises that Brexit would bring in a new era of prosperity for all, it is leading to long-term damage to the Scottish economy, and the decision is contributing to the UK’s becoming the poor man of Europe.
Now that Labour has become the new champion of making Brexit work, does the cabinet secretary agree that the only way to recover from the damage of leaving the European Union and protect Scotland’s future is for Scotland to become an independent country?
Unsurprisingly, I agree with the member. The evidence is that Brexit has been disastrous for Scotland. For instance, the Scottish Government’s analysis shows that Scotland’s trade in goods with the EU was 12 per cent lower in 2021 because of Brexit.
There have been many other warnings. Indeed, the combination of the United Kingdom Tory Government’s austerity agenda and Brexit must amount to the two gravest economic errors of our lifetime. They are imposing enormous damage on the Scottish economy and our people’s life chances. When it comes to helping to repair the damage, it is indeed the case that if Scotland was independent we would be able to rejoin Europe and gain the economic benefits from doing so.
Local Government Financial Settlement (Convention of Scottish Local Authorities Representations)
To ask the Scottish Government what representations it has had from COSLA regarding the local government financial settlement. (S6O-01881)
The Scottish Government has received a number of representations from COSLA regarding the local government finance settlement. Ministers and officials regularly meet representatives from COSLA and individual local authorities to discuss a range of issues, as part of our commitment to working in partnership with local government to improve outcomes for the people of Scotland.
The Scottish Government has claimed that the budget makes £570 million more in resources available to councils, but I say to the Deputy First Minister that that is not quite true, is it? COSLA says that, when ring fencing and directed spend are accounted for, the budget increases council spending by just £71 million in cash terms for Scotland as a whole.
The Scottish Parliament information centre tells me that the COSLA figure equates to £304 million in real-terms cuts. The Fraser of Allander Institute says that there is a real-terms cut. The Institute for Fiscal Studies says that there is a real-terms cut. Even Scottish National Party councillors are not buying the Government’s figures. Will the Deputy First Minister drop the spin, face the truth and admit that this is a budget for more cuts, closures and strikes across Scotland?
The Government has allocated £570 million more to local government for the next financial year compared to this financial year—budget bill to budget bill. That is the fact, and that is the reality of the budget uplift that has taken place.
In the resource spending review, the position for local government was presented as being flat cash from this financial year to the next. We have changed that. We increased the number by £570 million, to enable local authorities, as best we can within the resources that are available to us, to withstand the challenges that we all face around inflation.
Mr Bibby knows how the budget system works. There is a total funding envelope available. It has been allocated in full to portfolios. If Mr Bibby wishes to change that and allocate more money to local government, he has to do the decent, straightforward and honest thing and tell us where the money will come from. He should not come to the Parliament and posture; he should tell us where the money will come from.
Local Authorities (Budget Settlement)
To ask the Scottish Government how its budget settlement for local authorities will support the future delivery of quality public services. (S6O-01882)
In 2023-24, local authorities will receive funding through the local government finance settlement of £13.2 billion. Local authorities also have a range of revenue raising powers that are not available to other public services.
The impact of the settlement on public services will depend on how local authorities allocate the total resources that are available to them and the level of service that they then provide. Although local authorities are responsible for setting their own budgets, the total funding that is provided by the Scottish Government will increase by more than £570 million in 2023-24 compared with the 2022-23 budget.
The cabinet secretary claims, again, that more money is going into local government, but in the real world, councils are having to make savage cuts. That includes Scottish National Party-run councils, whose leaders are in revolt. Just this morning, Perth and Kinross Council—a council with which Mr Swinney is very familiar—agreed that its SNP leader should write to the cabinet secretary to express extreme displeasure and frustration at being threatened with sanctions rather than given adequate funding.
Members on the Conservative benches have been clear that Mr Swinney should scrap the national care service and redirect that money into local government. If he is not going to do that, where does he think that the cuts should fall? If not on education, should they fall on libraries, leisure services, arts and culture, the environment or support for vulnerable families? Where should the cuts fall?
Murdo Fraser does not support the increases in tax that I have announced in the budget, so before he comes to the chamber and tries to argue for any reallocation of money, there is a big, gaping, stonking black hole in his argument, which is his unwillingness to take the hard decisions that I have taken on tax. I have become accustomed to Mr Fraser’s posturing over many years, but, having wanted us to follow the Truss mini-budget that destroyed the public finances, he was then not prepared to take hard decisions on tax. Forgive me, Presiding Officer, but I will pay no attention to the Conservative Party’s critique of the budget that I have presented.
There are a number of supplementary questions. I will try to get through as many as possible, but they will need to be brief, as will the responses.
More than a decade of Westminster austerity has had a substantial impact on the Scottish block grant and the resources available to fund public services in Scotland. Can the cabinet secretary provide further information on what assessment has been made of the impact that that austerity has had on Scottish Government funding and how the levels of revenue funding provided to local authorities in Scotland compare?
Since the Conservative Government came into office in 2010-11, average real-terms cuts have been more than 5 per cent. That equates to a loss of £18 billion to Scottish Government budgets over that period, and there will be consequential effects on local government into the bargain.
Mr Kidd’s point is important. When the challenges that we face on hyperinflation, which, among other things, has been fuelled by the actions of the Conservative Government and its mismanagement of the mini-budget in September, are built on to the effects of austerity, they place real and enduring pressure on our public services and finances.
The Convention of Scottish Local Authorities estimates that road spending has fallen by a third, and there is a £1.7 billion repair backlog. Since 2010, spend on children’s play parks has fallen by 38 per cent. In libraries, spending on new books has fallen from £1.79 to 92p per person since 2007. What is the cabinet secretary’s assessment of this budget settlement on those services, and has the Scottish Government carried out an assessment of the impact on local services?
I will make two points. First, I think that Mr Johnson would accept that a decade of Conservative Government austerity has put cumulative pressure on Scotland’s public finances. I accept that, and I would have thought that he would have accepted it into the bargain.
Secondly, in the context of a very challenging fiscal environment, with all the issues and difficulties that we have faced, the Government has increased the resources available to local government by more than £570 million. That cash increase is there for local authorities to deploy in the appropriate way, as they see fit, to meet the challenges in their local areas.
Deposit Return Scheme (Repayment of Investment)
To ask the Scottish Government what discussions the finance secretary has had with the Scottish National Investment Bank and the Bank of Scotland regarding any impact of the repayment terms of the investment in Circularity Scotland in May 2022 on the timetable for the launch of the deposit return scheme. (S6O-01883)
Scottish ministers meet regularly with the chair and senior leadership team of the bank. As was agreed at its creation, the bank has operational independence, so it is not the role of Scottish ministers to intervene in any individual investment process.
As is set out in the regulations, Scotland’s ambitious deposit return scheme will launch on 16 August this year. It will be a major part of our efforts to reduce littering, cut emissions and build a more circular economy.
When a bank gives a business loan, there will always be an investment memorandum that dictates when the loan will be paid back and the interest that will be paid as part of the return on investment; furthermore, there will be penalty clauses for any late payment. Does the minister really suggest that the bank’s loans are unique in that there is no timetable for repayment and that, therefore, there is no impact on the timetable for the launch of the DRS? My real question is this: is the decision regarding the launch financial rather than being based on the business considerations of the businesses that will be impacted by the scheme?
As I noted in my first answer, the bank’s investment decisions are independent of Scottish ministers, and ministers do not intervene in any individual investment process.
Our deposit return scheme will launch on 16 August this year, as was agreed by the Parliament when the go-live date was announced in December 2021.
I understand that the United Kingdom Government is yet to reach a decision on how VAT will be applied to deposits as part of the DRS. Can the minister provide an update on the Scottish Government’s latest engagement with the UK Government regarding that issue?
We know how important it is for business to have clarity on the VAT on deposits. We are working closely with the UK Government to resolve that issue, and we are seeking action to minimise the risk to the Scottish scheme. I have met UK ministers on a number of occasions on the issue and have asked that it be resolved by July 2022 at the latest. As the issue was still unresolved as of last week, the Deputy First Minister wrote to the Chancellor of the Exchequer to request that a decision be communicated this week at the latest, and that is what we are now anticipating.
Ultimately, I believe that all tax powers, including those relating to VAT, should sit with the Scottish Parliament so that the decisions that affect Scotland’s businesses and people are made here, in Scotland.
That concludes portfolio question time. There will be a brief pause before we move to the next item of business.
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