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Together, Brexit and the pandemic have created a perfect storm—the costs of getting materials from various parts of the world have increased, shipping costs have increased, the costs of raw materials have increased and labour costs have increased. If we put all that together, we can see the impact on goods and services across the board—the construction sector is no different.

A number of projects are still coming in under the agreed benchmarks. There is a bit of geographical variation, and we need to be mindful that costs get higher the further north we go, because of a lack of economies of scale, the reduced number of contractors and so on.

The minister Ivan McKee has been in regular dialogue with the construction sector to consider what we can do, but the issues are global, and it is difficult for the Scottish Government to change things dramatically. We are working with councils and registered social landlords to support them in keeping the momentum going.

Good morning. I am grateful to the committee for inviting me and the minister to give evidence. The Covid pandemic has had a clear impact on the wellbeing of children and young people. The true extent of that will not yet be evident. That is why the committee’s inquiry is important and why the Government remains committed to getting it right for every child.

We know that there are strong links between experience of poverty in childhood and poorer health outcomes across a range of measures. Not only that, but there are impacts on wider life chances, including on educational attainment. We want better for Scotland’s children. We have set in statute ambitious income-based targets to significantly reduce levels of child poverty in Scotland by 2030 and we have declared tackling child poverty to be a national mission. We are working to mobilise all of Scotland to drive the progress that is needed.

Across the life of our first tackling child poverty delivery plan, we have strengthened the financial support that is available for low-income families across the early years. That includes support through our package of five family benefits, including the best start grant, best start foods and the Scottish child payment. That package will be further strengthened from April with the doubling of the Scottish child payment to £20 per week per child.

We now offer the equivalent of 1,140 hours of early learning and childcare to all three and four-year-olds and about a quarter of two-year-olds. That is a critical investment in children and parents. We have also delivered new employment support that is built on the values of dignity and respect, and is providing the help that parents need to access employment without fear of sanctions.

We recognise that holistic whole-family support is essential to wellbeing in tackling poverty. To that end, we have committed to investing £500 million in whole-family wellbeing funding during this session of Parliament.

We also recognise the additional challenges that our care experienced children and young people face. By the end of this Parliamentary year at the latest, we will publish a single implementation plan setting out the actions and commitments that we will deliver to ensure that we keep the Promise by 2030.

We will also publish our next tackling child poverty delivery plan by the end of March. That will set out the transformational actions that we will take with partners across Scotland to tackle child poverty and drive progress towards the ambitious targets that are set by this Parliament.

In 2020-21, our investment targeted at low-income households reached almost £2.5 billion, including nearly £1 billion that focused on low-income families with children. Delivering on our ambitions on child poverty and child wellbeing will require changes not only in ways of working, but in investment. That is why our on-going resource spending review has outlined child poverty as a key priority.

I welcome the committee’s inquiry and the opportunity that you have given me and the Minister for Children and Young People to answer your questions relevant to our portfolios.

First of all, we have made considerable progress in implementing the first delivery plan, which includes the key supports that I mentioned earlier such as the Scottish child payment for children under six, the bridging payments for older children and the parental employability support fund. We are not starting from nothing; building blocks are in place.

However, we recognised the need to give the next delivery plan far greater cross-Government focus. We cannot tackle child poverty through social security alone. Although that can do some of the heavy lifting, we must also try to reduce costs, as well as increase opportunities for employment, because we know that work is a key way out of poverty, including child poverty in families.

Making that happen requires the whole of Government’s focus; it also requires partnerships across the rest of Scotland with local government, the third sector and the private sector. The focus is very much around those three pillars and what we can bring across the whole of Government in pulling that together. I have spent a lot of time in bilateral meetings with colleagues, and we have spent a lot of time in Cabinet discussing the issues. Basically, we are looking at every possible way in which we can make the interim targets achievable.

That is against a challenging backdrop in which cost-of-living pressures are building and in which the £20 a week cut to universal credit—the uplift had been given during the pandemic—is causing problems. We are doing absolutely everything that we can, but I cannot overestimate how difficult the backdrop is. However, we need to get it right, because we absolutely must give our children the best chance of having the life chances that they deserve. We are working hard to do that.

Quite rightly, it has been a long-term aim and call of the third sector to move to multiyear funding, and we are keen to do that. We will be working with the sector to move towards that, because it will give it more certainty.

Funding for the third sector comes from across the whole of Government, not just my portfolio. My portfolio has the core third sector funding but the bulk of it comes from elsewhere across Government, so moving to a multiyear settlement requires a cross-Government agreement.

Again, I am happy to keep the committee apprised of the progress that we make with those multiyear funding discussions.

As I tried to set out in my initial answer, total funding for the Scottish welfare fund in the current 2021-22 financial year—we are talking about two different financial years—was £45 million, although £49 million was paid out, because councils top up the fund. We need to keep an eye on these things. As I said, we also provided £25 million of flexible funding, as part of the £41 million winter fund, in recognition of the demands on the fund that Pam Duncan-Glancy has alluded to. We will continue to work with COSLA and individual local authorities to monitor demand on the fund.

The review is examining issues such as funding, administration, promotion, take-up and accessibility. It will also address the issue of some local authorities using the fund a bit differently from others—some have an overspend and some have an underspend. The review will look at all those issues.

I reiterate what I have already said about third sector funding. Third sector funding, in the main, comes from across the whole Government. I think that the SCVO estimated that the third sector benefited from about £500 million of investment across the whole Scottish Government. Therefore, the amount within my portfolio is a relatively small part of that.

We do not believe that there will be any immediate impacts on infrastructure bodies that are funded through my portfolio. We believe that, by identifying efficiencies and working across other portfolios, individual organisations will not lose core funding in the short term, and we want to work on the multiyear funding that I talked about earlier over the medium to longer term.

First of all, I absolutely recognise the important role of the third sector. I reiterate that the major funding for the third sector does not come from my portfolio. The £500 million-plus comes from across the whole Government. We believe that, in relation to the £25.8 million for next year, adjustments can be managed through efficiencies and other portfolios that support the third sector. We do not believe that there will be the impact that Pam Duncan-Glancy has alluded to. We will work through these things. We will work with the third sector to ensure that what she has said does not happen.

However, as I said, it is a really tough budget. We need to make sure that we drive efficiencies where we can. We need to avoid duplication and make sure that every pound is spent in the most efficient way. The third sector is very efficient at spending the money that we provide, and we want to work with it to ensure that it continues to deliver what it is delivering. The third sector is a core part of the Covid recovery programme, and I give my commitment to support it to do its work.

Let me first reiterate what I said in my opening remarks. We have a budget of choices, into which we have put a huge amount of money beyond the block grant moneys received for social security. I can go into that in more detail during this evidence session.

The Scottish Fiscal Commission has recognised that the Scottish Government is putting a huge amount of money beyond that from the block grant into social security. I think that that needs to be recognised. It forms the context for the choices that we have had to make.

As Pam Duncan-Glancy said, we have made the commitment to double the Scottish child payment to £20 from April 2022, immediately benefiting 111,000 children under the age of six. When we announced the introduction of the benefit, we made it clear that it will be extended to under-16s by the end of 2022, subject to the receipt of the necessary data from the DWP, as I outlined in my previous answer. At that point, more than 400,000 children will be eligible for the £20 payment.

As Pam Duncan-Glancy mentioned, in advance of that, we are supporting as many school-age children and young people as possible through our bridging payments, which are worth £520, in 2022. That is an innovative response that makes use of local authority data to deliver immediate support to around 150,000 children.

The Scottish child payment remains the best way to provide the support that low-income families need, and that is why we have acted to double the payment from April and why we will move as quickly as we can to roll it out by the end of the year. It is estimated that 60 per cent of children in poverty live in a household with a child under the age of six, so the measure targets many families who are suffering from poverty, who will benefit from the doubling from April 2022.

The programme for government committed to deliver the increased payment by the end of the parliamentary session; of course, that PFG commitment will now be accelerated by four years. I hope that members will welcome that. We are going as far as we can as fast as we can, within the resources that we have.

On Pam Duncan-Glancy’s second point, I have laid out in some detail some of the data issues that are at play here. I have tried to be as clear and as transparent as I can be. We put forward our preferred data solution, and there was a very protracted negotiation. As I said, the upshot is that we have had to reluctantly agree to using the DWP’s system—its new strategic solution. It is a bit higher risk because the DWP has yet to build and test that new strategic solution. We have not yet received the full design specification, so that means that the Scottish child payment team has started its development work with that risk, basing it on a set of assumptions and accepting that some reworking is likely to be required once the full design specification has been shared with us.

That said, as I said in answer to the convener, there is now a structure around monitoring progress, with some trigger points. If there are concerns, ministerial involvement will happen very quickly.

Again, I am very happy to keep the committee informed. From our side, we are absolutely determined to see our roll-out commitment happen by the end of the year. However, as I also said to the convener, we require the data from the DWP to do that. It is a joint, two-Government responsibility, and it is important that every effort is made to ensure that those timescales are met.

I will come on to that in a second. Let me just address a point about administration costs.

Pam Duncan-Glancy is correct to say that some of the administration of benefits is still handled by the DWP, but we make the policy decisions in Scotland. We have made policy decisions that have been very important, such as on the Scottish child payment, which is a brand new benefit that supports families. We are making major changes to the look and feel of disability benefits. We are bringing in additional support—I will come on to carers in a second—and we are bringing in new supports, including low-income winter heating assistance. The policy decisions and, therefore, the money that goes into people’s pockets here in Scotland are the important things. Even if some of the administration is still with the DWP and will transfer in time, the policy choices that we have made are what are most important.

On carers, first of all we recognise very much that the pandemic has suggested a need for greater flexibility in how we support carers. The Government chose to pay coronavirus carers an allowance supplement in 2020 and we paid that again in 2021. We did that from our fixed budget, as I have said during this session. The additional £40 million that was invested in the two coronavirus carers allowance supplements, this year and last, is all from the Scottish Government’s budget. We have had to make choices in order to do that.

Pam Duncan-Glancy noted that no initial allocation has been made for a further payment in 2022-23. We will keep the position under review as part of the ongoing budget process and, importantly, we will take into consideration the circumstances of carers. Financial constraints need to be balanced, as does where we are in the process of recovering from the pandemic.

I make the point that whether we are talking about additional support for carers, more support for the Scottish child payment or more support for local government, we cannot do everything on a fixed budget: we have to make choices. If more money above what we have already allocated is to go to the Scottish child payment or to carers, it has to come from somewhere. I am happy to continue discussions. If Pam Duncan-Glancy or others want to suggest where that money should come from, I will be happy to have those discussions. However, we have tried to allocate what we can to support carers.

Today, in recognition of the needs of unpaid carers, we are announcing an additional £4 million to help organisations that work with unpaid carers to put expanded services in place this winter. That is in the here and now, because we recognise that they are under pressure. They are doing an incredible job. That funding will help local carer centres across Scotland to expand their vital support. It will support young carers, expand the family fund support for breaks and provide money for wellbeing support and services. We recognise the needs of carers and are putting money into supporting them in the here and now, as well as through the coming budget.

Thanks very much, convener, and a happy new year to everyone. Thank you for inviting me, supported by Shirley Laing and Kevin Stevens, to the committee.

As you will be aware, this is another challenging budget—perhaps the most fiscally challenging to date. We have had to make choices and we are proud that we have chosen to back our national mission to tackle child poverty and strengthen the support that is available for families during the cost of living crisis.

We have committed almost £200 million to support the doubling of the Scottish child payment to £20 from April 2022, immediately supporting 111,000 children under the age of six. We are committed to rolling out the Scottish child payment fully to under-16s by the end of 2022, backed by an investment of £197 million. In the meantime, we will continue to meet the costs of delivering a bridging payment, worth £520 a year per child in 2022, to around 150,000 children of school age. That investment underlines our commitment to delivering on our national mission and, of course, we will publish our next four-year tackling child poverty delivery plan by the end of March. The plan will outline cross-government action to put Scotland on a critical path to meet the targets that have been set.

The Scottish child payment forms part of the £4 billion that we are committing in social security and welfare payments, which will go directly to over one million people in Scotland. The money will help low-income families with their living costs, support older people to heat their homes in winter and enable disabled people to live full and independent lives.

This summer, we will introduce the adult disability payment, which will deliver approximately £1.95 billion of support for working-age disabled people. This brand new benefit will provide disabled people with a fundamentally different experience when applying for and receiving the support that they are entitled to. I am delighted to confirm that the regulations for the adult disability payment have been laid before the Parliament, marking a significant milestone in the devolution of disability benefits.

We are investing £530 million to deliver the devolved social security system in Scotland in 2022-23, ensuring a simplified, compassionate system that will treat everyone with dignity, fairness and respect, and provide people with an improved experience.

This winter, we will launch low-income winter heating assistance. Through an investment of £21 million, around 400,000 low-income households that are currently eligible for cold weather payments will receive a guaranteed annual payment of £50. We are also investing £41 million, including local authority administration, in the Scottish welfare fund to provide essential help to the most vulnerable people in our communities.

The budget also recognises the important role that carers play in supporting those with disabilities or long-term conditions, with a further £315 million of funding for carers allowance and £42 million for carers allowance supplement.

Within the budget, we are making available £831 million for affordable housing, progressing our commitment to deliver 110,000 affordable, energy-efficient homes across the next decade, of which at least 70 per cent will be available for social rent and 10 per cent will be in our remote, rural and island communities.

We are making a further £10 million available for our ending homelessness together fund. This continues our investment of £100 million for transformation funding between 2018-19 and 2025-26. It supports the commitment that we made in the programme for government to continue to invest over £100 million to support front-line services and focus on the prevention of violence against women and girls from school onwards over the next three years. That figure includes the enhanced delivering equally safe fund, which we have increased by £12 million to £38 million, providing over £28 million to support front-line services and £2 million for prevention over the next two years.

In conclusion, this is very much a budget of choices and, indeed, a transitional budget in which we have sought to support our three strategic priorities of child poverty, climate challenge and Covid economic recovery while progressing our resource spending review for the longer term. That will be under way soon.

I thank the committee for its pre-budget scrutiny and I look forward to your questions.

We have agreed to make sure that the best start payments and the best start grants are uprated going forward. The best start grants and the best start payments form an important part of the support that is given to children and are an important part of the overall package. We increased best start foods in August this year from £4.25 to £4.50, a rise exceeding the rate of inflation and providing a level of support more generous than in other parts of the UK. We are also widening eligibility for best start foods later in the parliamentary term. We increased the best start grant in 2021 by 1 per cent, which is technically double the rate of inflation. A two-child family will now receive £1,919 in their children’s early years, which is £1,419 more than the sure start maternity grant equivalent. Of course, as I have said earlier, the families receiving the best start grant and the best start foods will also benefit from the doubling of the Scottish child payment from April.

We talk about big numbers and those numbers do not always mean a lot to people, but when you take them together, the best start grant and the best start foods will provide a financial support package that is worth £8,400 by the time an eligible family’s first child turns six, which is a commitment to the most vulnerable children that is unparalleled across the UK. I think that that brings home what this means for families.