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First, I remind everyone that we have a statutory duty to tackle child poverty, so we have a statutory duty to look at which options we can take to further reduce it. The fact that we are the only part of the UK that is seeing child poverty rates reduce suggests to me that the decisions that we have taken over the years that have impacted on child poverty have been successful because, otherwise, we would not have seen child poverty rates reduce in Scotland when they have not reduced elsewhere in the UK.

The evidence-based approach that we have taken, which is set out in the child poverty delivery plan, has looked at all the levers that we need to pull—the Scottish child payment is the key one, but it is not the only one—in order to get to this point.

The First Minister then challenged us, as part of the budget process, to consider what more we could do. Ministers were charged with feeding into that process. In discussions with the same bodies that were involved in the detail that got us to the child poverty delivery plan, the Scottish child payment and the other measures, they told us that, on the basis of the evidence that they had, which we looked at, the mitigation of the two-child cap was the next lever that would have the biggest impact compared with anything else that we could do. Traditionally, many of those organisations had called for increases in the Scottish child payment. In this case, rather than doing that, they said that mitigating the two-child cap was the lever that would have the biggest impact, because it would target the poorest children.

Since we made the decision and announced it at stage 1 of the budget process, other organisations have come out with further analysis of what they believe the impact of that policy will be. If I am not mistaken, it is the Fraser of Allander Institute that has said that the number of children who will be lifted out of poverty is higher than the 15,000 that we had assumed. That gives me a sense of confidence that we are in the right place with the policy.

On the delivery and the funding of the policy, as I said when I was previously here, we have made available to Social Security Scotland the funding for the technical build and delivery of the system to enable it to put that in place. We will make available the funding for the delivery of the mitigation itself in the 2026-27 budget.

We will prioritise that. We have not got to a point whereby child poverty rates are reducing in Scotland and not reducing elsewhere by default. By making the investments that we have made, we have managed to get to a certain point on our journey to eradicating child poverty. We all have a duty to meet those statutory targets. As the Fraser of Allander Institute has said, the proposed intervention will move us along the route towards meeting those targets.

Not investing in tackling child poverty is a very expensive thing to do. You do not reap the rewards that come with making such investment. In the absence of such investment, when children grow up, they are not able to become the productive citizens that we would want them to be, contributing to the economy and the success of our country. That is why, over a number of years, we have taken the decisions that we have taken.

We chose the two-child limit mitigation based on the evidence that had been presented to us that that was the most effective intervention that we could make, beyond any other intervention. That was the basis for the decision that we took, which is now in front of Parliament. That has since been confirmed in many ways by the further analysis that has been done.

The Fraser of Allander Institute modelling shows that about 20,000 children would be kept out of poverty by mitigating the two-child limit, which is slightly higher than the Scottish Government’s estimate of 15,000. That reduction would mean a decrease of two percentage points in the relative poverty rate, which members across the Parliament have legally agreed to reduce. I have not seen any other alternative that would reduce the relative child poverty rate by two percentage points. Nothing has been brought before us, and no organisations have produced alternatives. I have not seen anything from anyone else that will deliver that.

That is why we have taken the decision that we have taken. We will prioritise the investment that will need to be made in 2026-27 onwards in order to deliver that, because we have a legal duty to reduce those rates—it is not simply something that it would be nice to do.

As you had previously raised those issues, I went away and did a bit of digging before I came back here today. Some of the issues and questions that you have raised are absolutely legitimate.

First, I reassure you and others that Social Security Scotland carefully reviews the cases of all adult disability payment clients to ensure that the right decisions are made. Parliament unanimously agreed that it was to be a light-touch process, which meant that clients would not be asked for unnecessary information or for details that were already available. We all agreed to that—there was no dissent.

Despite its light-touch approach, Social Security Scotland seeks additional information from sources, including medical professionals and its clients, when required. An important point that I want to put on record is that the majority of cases that have been reviewed since the adult disability payment was introduced have been the cases of clients whose awards had been transferred to Social Security Scotland from the Department for Work and Pensions. In most cases, their existing awards accurately reflected their needs. However, it is worth noting that many of those reviews were for people who were not due for a scheduled review, but who had reported that their needs had increased, which triggered the transfer of the award to Social Security Scotland and a review by it. That makes a comparison between the two groups a bit misleading. I am happy to come back to the committee with further information on that.

With regard to the suggestion that more people might be coming forward for such benefits in Scotland, rather than the issue being to do with the review point, Parliament unanimously agreed that we would have a benefits take-up strategy to promote the take-up of benefits. As the DWP does not do that, of course that will lead to more people coming forward and claiming.

The evidence that we drew on in the early ministerial discussions was the evidence that was available at that point, which was from third-party organisations that we had met. They gave us evidence that mitigation of the two-child cap would have the biggest impact on child poverty reduction.

COSLA did its calculations again and came back with a figure of £240 million—that is the reason. We asked it to do that because there were various figures around—COSLA’s figures and the Fraser of Allander Institute’s figures—and some councils had included things that others had not. COSLA went back and did a baseline study across the 32 local authorities, which came back with the figure of £240 million.

Good morning, everyone. I thank the committee for its budget scrutiny report, which I have considered carefully.

The Government has engaged widely across the Parliament to try to build consensus for a spending programme that will deliver for all of Scotland. The budget has been enhanced by the agreements with the Scottish Liberal Democrats and the Scottish Greens and the further action that we will take in supporting neonates who are affected by drugs; in investment in free school meals and nature restoration; in the introduction of a bus fare cap pilot; and in provision of targeted support for hospices and colleges. That approach of parties working together demonstrates how the Scottish Parliament was designed to work.

I look forward to consideration of amendments on the bill’s measures and to members’ questions in advance of that in this scrutiny session.

First, it is important that we are able to set out the pipeline for capital allocations that will draw on the spending review that will be published in June. Although we have a line of sight on immediate capital availability—which, for 2025-26, is all committed—we need a longer line of sight in order to give certainty on projects. Therefore, the capital envelopes that we will get an indication of at the spending review in June will be important in respect of our setting out what projects can be progressed and when.

I am keen to engage with the committee on that. The certainty of multiyear funding for our infrastructure build will be important.

As I have said, the evidence to date shows that more people across all tax bands are still coming to live and work in Scotland. It is important to say that. It is also important that we continue to monitor the emergence of any such direction of travel as you have articulated, and we will do that. Lucy O’Carroll, do you want to come in with any further thoughts?

The six proposed amendments will update the bill to reflect the changes that I communicated to the committee in my letter of 28 January 2025. The changes arise from the Scottish Government’s having reached separate agreements with the Scottish Liberal Democrats and the Scottish Green Party on supporting the budget, which will deliver on shared priorities and ensure stability for Scotland’s public services.

Taken together, amendments 1 to 4 will amend schedule 1 to increase the maximum spend across four ministerial portfolios. They will authorise a combined total of £16.7 million of additional funding for the health and social care portfolio, the education and skills portfolio, the transport portfolio and the net zero and energy portfolio.

Amendment 1 will increase the health and social care portfolio allocation by £3.5 million. That will provide £2.5 million for drug and neonatal services and a further £1 million for hospice investment.

Amendment 2 will increase the education and skills portfolio allocation by £7.2 million. That will provide the college sector with £3.5 million for the offshore wind skills programme and the college care skills programme. It will also provide £0.7 million for continuation of support for Corseford College and £3 million for the extension of free school meals eligibility in secondary schools, with a test-of-change phase for secondary 1 to 3 pupils who are in receipt of the Scottish child payment in eight local authority areas.

Amendment 3 will increase the transport portfolio allocation by £3 million to establish a £2 bus fare cap pilot in a regional transport partnership area.

Amendment 4 will increase the net zero and energy portfolio allocation by £3 million to provide further investment in nature restoration activities.

To take account of that additional authorised spend, amendment 5 will amend schedule 1 to increase by £16.7 million the total amount of resources that the Scottish Administration will be authorised to use.

Finally, amendment 6 will amend section 4 as a consequence of amendments 1 to 5. It will increase the Scottish Administration’s overall cash authorisation by £16.7 million so that the Government can draw down the necessary funds to cover the additional spend that I have set out.

I urge members to support the amendments in the group.

I move amendment 1.

I reassure you that a lot of work will be done between those meetings. Work has been commissioned since the first meeting, back in December, which I attended. We looked at a number of areas that we need to focus on across a number of portfolios, and we commissioned a lot of work to be done in advance of the meeting in the spring. The meetings are, if you like, check-in or gateway points to ensure that the work that we have commissioned to ensure that we are focusing on what we need to focus on is happening at the pace that we expect.

I hope that that gives you some reassurance that it is not the case that nothing happens in between the meetings. Work does indeed happen, and it is the most important work that is going on.