Seòmar agus comataidhean

Good morning, and welcome to the second meeting in 2021 of the Finance and Public Administration Committee. The first item on our agenda is a decision on taking business in private. Do members agree to take item 4 in private?

Members indicated agreement.

I inform members that Patrick Harvie has resigned from the committee, no doubt due to his elevation to ministerial office. Although he has been to only two meetings, I thank Patrick for his contributions to date.

I have pages of questions, but I will let other committee members in after my next question, which is on a different topic: international supply pressures. Your forecast says that

“we assume there are no future waves of rapidly rising ... deaths and hospitalisations”

but that

“There are ... ongoing international supply pressures which combined with domestic recruitment challenges present risks to our forecasts.”

The impacts are from not just Covid but Brexit. How do you quantify the risks from supply pressures? We have heard about significant rises in raw material prices, for example, which could have an impact on the ability to deliver the Scottish Government’s capital programme.

There is a significant mismatch in the labour market between skills and geographic location.

We will certainly deliberate on that in our next private session, which is about to start in a few minutes, when we consider our work programme.

I thank both our guests today, particularly the cabinet secretary for answering so many questions in such depth, particularly after a session at the Local Government, Housing and Planning Committee. I realise that it has been a very heavy morning for you, so I hope you will have a wee break now before the rest of the day’s proceedings.

Thank you. I open up for questions from the committee.

That is clear.

Your report says that house price stability will be established in the current financial year and that prices will grow in subsequent years. How did you come to that conclusion? House prices appear to be rising quite significantly.

I asked a question about the possibility of deferred funding, and members asked about the impacts on a number of areas of the Scottish budget. You talked about how difficult it was, as did members, with additional funding coming in at a time when local authorities were agreeing their own budgets and the council tax settlement was being agreed. Should we get into that situation—I hope that we do not, because I hope that the UK Government will do as it has done previously and agree a carry-over if necessary—do you have any shovel-ready projects available that would allow you to provide additional support to businesses or other areas of the economy, so that that money is used effectively?

Just look at the most recent block grant adjustment—it was only £34 million.

Straight in at the deep end.