Seòmar agus comataidhean

There is certainly a legal duty with regard to the ballot and the shareholder vote, which was how things played out at Reidvale. However, the root cause of the problems was the notion that it was simply good practice to carry out tenant consultation prior to a formal options appraisal. From a reading of the regulations, though, it seems to me that that is a requirement, and if the process is not compliant, there is a “Do not pass go” mechanism. In any case, the regulator should certainly intervene at that point to say, “We don’t think that you’ve followed this procedure correctly. You shouldn’t be doing an options appraisal before you’ve done consultation with the tenants and the wider stakeholders in the community.” It was only when the options appraisal was published that Reidvale was told that it needed to do a transfer of engagements. That became the narrative from that point onwards, when everyone was caught unawares. Do you see what I mean?

I know that there has been talk of merger culture—I will not repeat that discussion—but, clearly, concerns arose during the process at Reidvale about statutory managers, who also regularly act as interim directors and transfer consultants. There seems to be a community or ecosystem of people who are associated with each other—who have those relationships.

There was concern that, if there is a merger culture, or an alleged merger culture, having someone who is a statutory manager one minute and a transfer consultant the next could lead to the reasonable conclusion that they are biased towards transfers as an appropriate measure, instead of towards working hard to protect the community control of the housing association. Does there perhaps need to be greater transparency about relationships, the register of interests and so on? Maybe that is something that could be improved in the statutory framework.

I apologise for my late arrival—I had to attend the Health, Social Care and Sport Committee prior to attending this meeting. I thank the gentlemen from the SHR for their attendance. I should also declare that I have recently become a member shareholder of Reidvale Housing Association in Glasgow.

Gentlemen, you will recall that, about this time last year, we were reflecting on the situation at Reidvale. Obviously, things have moved on since then. I would like to reflect on what has gone on there in the past 12 months or so. What lessons can be learned from the process?

If we look back, it seems that the root cause of some of the challenges at Reidvale was standard 7.3 of the Scottish Housing Regulator’s standards of governance and financial management, which states that a registered social landlord must ensure that there is “adequate consultation” before engaging in an options appraisal. However, that was not carried out at Reidvale Housing Association. That is quite a subtle emphasis. It was a fait accompli that transfer was the preferred outcome prior to the tenant consultation being carried out; it was presented as though there was no alternative.

Bearing in mind that concern, which was raised with the regulator at the time, and how things subsequently played out, do you have any reflection on the application of standard 7.3 and how it can be clarified to ensure that all the options are looked at fully, with consultation being carried out with tenants on what they want to do with their community-based housing association before the formal options appraisal is undertaken?

I very much appreciate that.

I appreciate that response. I have one more quick question. On the idea of peer support, and of housing associations co-operating to support each other, is there concern that giving RSLs a non-compliant status could lead to a chilling effect? A neighbouring housing association might want to support another association, but they might be non-compliant. Non-compliance is not the end of the world—it can often be quite benign issues that just need a bit of work—but it might create an idea that one housing association is tainted and cannot work with another one, or look to develop a relationship.

Similarly, I have heard reports from housing co-operatives that they are being pressured to demutualise because it is seen as inappropriate that the membership of the housing association is restricted just to tenants. That is not seen to be a good thing, and that people from outside the housing association should be brought in. However, the principle of co-operation and co-operatives is that it is the people who have a stake in them who are the members. Perhaps some of the practices of the regulator can militate against that idea of co-operation in building housing co-ops and collectives.

I thank the cabinet secretary for his opening statement. Health and social care is a huge area of public expenditure for the Scottish Government. Next year, the overall health and social care budget is forecast to be 42 per cent of all Government revenue expenditure, which is a significant amount.

Understanding like-for-like comparators can be quite challenging; there are cash figures, real-terms figures and percentages. Our concern is that the change in baseline presentation in this year’s budget presents challenges when trying to do a meaningful interpretation of year-on-year changes to the health and social care budget.

We note that, from budget to budget, there is a real-terms increase of 3.4 per cent, but under the new presentation of autumn review to budget, it is 7.5 per cent, which is a clear difference. Do you accept that the previous budget-to-budget presentation was more meaningful, given the significant in-year transfers that take place each year from health to local government and, in the case of clinical training, to education?

Thank you very much.

That would be really helpful. If transfers are known about and tend to take place year on year as a common practice in Scottish Government financing, would it make more sense to show the budgets from the outset in the portfolio area that will ultimately undertake the spending? For example, that could be local government in respect of social care budgets or education in respect of nursing tuition.

That would be welcome.

Does the cabinet secretary remain committed to the Scottish Government policy to pass on all health-related Barnett consequentials to the Scottish health budget? To what extent will that support the current 2024-25 budget?

Could the cabinet secretary provide more detail on the changes that underpin the significant decline in the “miscellaneous other services and resource income” budget line?