Budget Scotland Bill: Stage 1

Part of the debate – in the Scottish Parliament at 2:23 pm on 23 January 2008.

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Photo of Andrew Welsh Andrew Welsh Scottish National Party 2:23, 23 January 2008

In speaking to the Finance Committee's report and the amendment, I thank all the members of the committee for the constructive way in which they approached the task in hand. I also thank our committee clerks, our Scottish Parliament information centre researchers and our budget adviser, Professor David Bell, for all their hard work. This was very much a team effort, and everyone's input has been greatly appreciated.

We also had a first this year: all the subject committees appointed specialist advisers who worked with our adviser to discuss common approaches to scrutiny and to seeking budget information. The Finance Committee adviser has been appointed for two years and the subject committee advisers were appointed for the duration of the subject committee's scrutiny. Different advisers might be appointed for finance budget scrutiny in the future because subject committees might now want to look at discrete areas of the budget on which different specialist advice is needed. Therefore, although we cannot have a standing group of advisers at the moment, having all the advisers working together has been successful and we would like to adopt and develop that in future years to put Parliament at the leading edge in financial and budget scrutiny.

To help us to get a sense of how the budget affects local areas, the committee held an external meeting at Discovery Point in Dundee. I thank all those who participated in the workshops that we held there before we took evidence from the Cabinet Secretary for Finance and Sustainable Growth. Such meetings are an important part of our outreach work, which I would like to be continued and further developed.

The backdrop to this year's budget is that the United Kingdom spending review has given us the lowest growth rate since Parliament was established. We have a new Government and a new budget, which proposes a new relationship with local government. We had to grapple with those issues in our scrutiny of the budget. Apart from putting forward two proposals, which asked the Government to consider how police recruitment can be further increased and how reductions in business rates can be accelerated, the committee also made some important recommendations on budgetary information and on how the new relationship with local government will work and be monitored.

Although there were changes in how the information was presented in the new budget documents, it was not the case that vast swathes of information disappeared for no reason. Because of the new relationship with local authorities and the concordat that was signed with the Convention of Scottish Local Authorities, a number of budget lines were rolled up into the local government settlement as the money was no longer to be ring fenced and so was not shown separately in the draft budget.

However, the committee noticed that there seemed to be differences in the way that some level 3 information had been presented and wrote to the Cabinet Secretary for Finance and Sustainable Growth on the matter. The response that we received showed that more than 160 level 3 budget lines had, for various reasons, been merged, renamed or dropped. The committee welcomed the cabinet secretary's clarification, but thought that the changes made it difficult to read across to previous years. Although the information was made available to us, we believe that it would have been better if the changes had been footnoted or listed in a separate annex. Although we recognise that the budget documents had to be put together quickly this year, we have recommended that in the future the Scottish Government should agree any significant changes in presentation with the committee. Our common objective is accountability and openness.

The main concerns that were expressed by subject committees were about level 3 budget lines, which are now rolled up into the local government settlement, and about the absence of identifiable grant-aided expenditure totals, which I should point out are not budgets for local authorities; in fact, GAE is a basis for calculating the distribution of the Scottish Government's grant to local government.

We must recognise that we are dealing with a new system. Local authorities are now being given the freedom to spend their money according to their priorities, rather than according to central Government diktat. Although local authorities are now locally accountable for the money that they spend, the important point is that public expenditure is still monitored and tracked. As a committee, we tried to balance the concerns that were expressed by the subject committees with the fact that we are in a new situation to which we must adapt.