To ask the Scottish Executive what progress is being made with the proposal to implement a local income tax. (S3O-94)

The Government is committed to abolishing the unfair council tax as part of our agenda to create a wealthier and fairer Scotland. We will announce in due course detailed proposals to introduce a local income tax.

Does the cabinet secretary recognise that there is no inherent, popular public support for that dangerous policy? If there were, surely the former junior partners in the previous coalition would be standing where he is standing, instead of withering on the vine and contemplating some judicious summer pruning. Does he recall that last week, in response to a question from Annabel Goldie, the First Minister said merely that he saw a "difficulty" with our proposal to give pensioner households a 50 per cent council tax rebate? A difficulty is not an objection in principle. Surely he will not let a little difficulty stand in the way. Will he commit now to work with the Conservatives to secure that vital relief for Scotland's pensioners, whatever the torrid fate of his local income tax plans?

Mr Carlaw misjudges the situation. On my left and my right, I am surrounded by the former junior partners in the coalition, who enthusiastically support the local income tax and the abolition of the council tax. He should explore the new politics a tad further before he jumps to such conclusions.

To reinforce what the First Minister said last week, we do not support the Conservatives' proposal to discount the council tax for all pensioners, because it does not take into account the ability to pay. One of the fundamental points in the Government's approach to local taxation is that we want to make it affordable for everyone in Scotland and to relate it to the ability to pay. In the short term, we will concentrate minds on freezing the council tax and on moving to the abolition of the council tax and the introduction of a fair system of local income tax, which of course will require support for legislation from Parliament. I look forward to enthusiastic support for that legislation from those sitting on my left and my right.