Seòmar agus comataidhean

The most recent scan of taxpayer records to

“identify missing or invalid postcodes which would result in incorrect residency status being applied”

was in June 2021. It identified 25,488 missing or invalid postcodes, of which 3,031 were updated.

Reported postcodes, whether missing or invalid, represent 1 per cent of the 2.5 million total income tax population in 2020-21. A small number of missing taxpayers can potentially equate to a large amount of revenue, especially if that group contains high-net-worth individuals.

Has the NAO received an update from HMRC around the monitoring of that situation, and specifically on the causes of missing or invalid postcodes? What might the impact be on revenues, and what, if anything, is being done to address the matter?

Some of my colleagues have questions on sustainability and keeping up the momentum.

There are an awful lot of recommendations over a short timescale. If, as we hope, things are successful, are there lessons to be learned and good practice that could be shared with others?

The committee’s report on the 2020-21 audit of the Crofting Commission recommended that

“the Crofting Commission and the Scottish Government put plans in place to regularly review the revised framework document to ensure it remains fit for purpose.”

Do you know what plans—if any—are in place?

Your report states that the auditor has assessed all 41 recommendations that were made in the 2020-21 audit report as being “fully implemented” by the commission. Of those recommendations, 34 were in relation to significant weaknesses in leadership and governance arrangements, as identified in last year’s audit. That is a lot of recommendations. Are you content that those significant issues have been adequately addressed in what seems to be quite a short period?

Moving on to the smelter, paragraph 32 of your report notes that in 2016

“the Scottish Government issued a 25-year financial guarantee contract to SIMEC Lochaber Hydropower Limited”.

The complexity of the financial arrangements is also mentioned. What are the implications of the continued high level of provision in relation to the Scottish Government’s financial guarantees to the smelter?

Moving on again, paragraph 35 states:

“In March 2022, the Scottish Government published its Business Investment Framework to outline its principles and approach for decisions about future investment in private companies.”

Is the framework sufficiently robust for informing decision making in that area?

Good morning. The report notes that the Scottish Government can borrow £450 million per year, up to a cumulative total of £3 billion, for capital spending. It then points out that capital borrowing in 2021-22 was £150 million; it has been below the £450 million threshold in each of the last four years. You also note that there is limited information on how capital borrowing is being used.

The Scottish Government can also borrow for resource spending, up to a maximum of £300 million per year and up to a cumulative maximum of £1,750 million.

Is the Scottish Government sufficiently transparent about its decisions to undertake both capital and resource borrowing?

Okay. Thank you. I will move on to investment in private companies. Specifically, the paper mentions Prestwick airport, Ferguson Marine (Port Glasgow) Holdings Ltd, Burntisland Fabrications Ltd, or BiFab, and the Lochaber aluminium smelter. Starting with Prestwick airport, what are the financial implications for the Scottish Government of continued failure to find a buyer for it?

What better information could be provided to support effective scrutiny of the use of capital borrowing powers and the specific projects that it supports?

Do you have any concerns about the increasing level of repayment charges for the borrowing, and does the Scottish Government take any view on what is considered reasonable?