Local Government Finance

– in the Scottish Parliament at 10:21 am on 4th December 2008.

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Photo of Alasdair Morgan Alasdair Morgan Scottish National Party 10:21 am, 4th December 2008

The next item of business is a debate on motion S3M-3014, in the name of Derek Brownlee, on local government finance.

Photo of Derek Brownlee Derek Brownlee Conservative 10:27 am, 4th December 2008

Fundamental reform of local government finance should be neither considered lightly nor undertaken without full consideration of the positive and negative consequences of the options. It might feel as though we have been debating local income tax for many years, but the fact is that the system of local government finance is altered perhaps only once in a generation.

Why, in that case, should legislation be restricted to only one option—the Government's option? We know that opinion in Parliament, as in the country, is divided on the issue. The SNP favours a nationally set income tax, the Liberal Democrats favour a locally set income tax, and the Greens favour a land value tax. We, on the other hand, have set out proposals for council tax reform. Labour has indicated a similar desire, although it would no doubt propose different reforms to those that we favour.

Today, we advance a simple proposition: instead of restricting consideration to one option, we should allow Parliament to consider all of them. Each of us can argue the case for our preferred option and outline the case against the options that we oppose. Such an approach would allow us to tease out the practical implications of the various options. Indeed, that point was raised in Margo MacDonald's amendment, which we would have supported, had it been selected for debate.

The Government obviously does not agree with what I thought was a very reasonable proposition and has decided to close down debate on the matter.

Photo of Derek Brownlee Derek Brownlee Conservative

Well— Last year, we were told to wait for the consultation to be published, then we were told to wait until the consultation had finished. Now we have been told to wait until next year. However, the Government's real agenda is to make the issue of local government finance a straight choice between the status quo and its own proposals.

Quite apart from the lack of a majority for its proposals—which in itself is quite a problem—the problem with the Government's approach is that no one in the Parliament is arguing for the status quo. Even those of us who prefer to retain the council tax want it to be reformed. Although polarising the debate between the Government's preferred option and the status quo might give the Government a slightly better chance of winning a vote, it does not give Scotland a better system of local government finance because it simply excludes too many options.

Whatever our preference for local government finance reform, there is no point in our changing the law only for further change to be made in the next Parliament, where the arithmetic will be different. We might never reach widespread consensus on the right system, but unless we can fully examine every option and unless every party is able to put forward proposals on their own merits and have them debated and voted on, there will be no chance that whatever is voted through will gain lasting acceptance. Whatever one's perspective on local government might be, such an approach cannot be sensible.

Although the Government's amendment is simply a rehash of the case against council tax that it has made on many occasions, it does not seem to suggest that there is any problem with having a broader debate. The bottom line for the Government is that council tax reform is a serious option that should be considered.

The Conservative position is clear. I am not going to hide the fact that we do not like local income tax and reject both the SNP and Liberal Democrat variants. We want council tax reform, with the subsidy the Government says it will use to subsidise local income tax used instead to reduce every council tax bill. On top of that, we favour a discount for pensioner households—something that Mr Alex Neil, who is absent this morning, has famously favoured—and we are very interested in options for a green discount for energy efficiency measures, which could be delivered via a property-based tax such as council tax, but not via a person-based tax such as local income tax.

We believe that there are so many problems with local income tax that if the legislation were ever passed, it would be unlikely ever to come into effect. At that juncture, reforming the council tax will be the obvious solution. If the Government is genuinely convinced that local income tax is better, why on earth does it fear counterproposals for a reformed council tax? The only reason for its opposition is that it knows that it is possible to deal with some of the concerns around council tax by reforming rather than abolishing it. The Government is ploughing this particular furrow not because it sees no merit in the various options for reforming local government finance, but because of political dogma.

I am not going to pretend that I have been convinced of the case for the land value tax, but the same argument applies: if local income tax is better, why on earth is the Government frightened of debate? Why is it worried about alternatives? If local income tax is that good, it will stand on its merits. Only if it does not stack up is there any reason to restrict the scope of the debate. I am certainly quite happy to examine the Green party's proposals on their merits. I hope that Parliament shares that view.

The Government is happy to tack on some mention of land value tax to every motion that it lodges on local income tax but, as far as I can see, it has done nothing to advance the debate on the issue—which is what I am sure it has promised Mr Patrick Harvie on every occasion. A look at the Official Report shows that we seem to have been discussing and promising the Greens serious consideration of land value tax since the first session of Parliament. However, that consideration has never taken place, so the Government should really stop stringing the Green party along on such an important matter.

We know what will happen to the Liberal Democrats: the Government will tell them that it will introduce local income tax at a fixed national rate initially to let it bed down and then, in the fullness of time move—perhaps—to a locally variable tax. Of course, there is, because of the practical difficulties, no intention that that local variation will ever happen. However, the move will no doubt be enough to secure Liberal Democrat votes in the meantime.

Curiously, the Liberal Democrats have a greater chance of getting a vote on their preferred system of local government finance under the approach in the Conservative motion than they have under what is set out in their own rather tame amendment. No doubt they will make it clear whether they will support the Conservative motion if their amendment does not succeed. I look forward to their speeches.

I move,

That the Parliament notes the intention of the Scottish Government to introduce legislation to reform the system of local government taxation and calls on it to ensure that the scope of the Bill when introduced is sufficiently wide as to enable members to debate and vote on all options, including reform of the council tax, a land value tax, a local income tax with variable rates determined locally and the Scottish Government's own proposals.

Photo of John Swinney John Swinney Scottish National Party 10:34 am, 4th December 2008

What a difference a day makes. Yesterday, Mr Brownlee and Mr Whitton were engaged in the most ferocious political battle on the floor of Parliament. I have never seen Mr Brownlee more venomous in a contribution to a parliamentary debate, nor have I seen Mr Whitton more exercised in defending the record of the United Kingdom Government. They were fighting about which Government—Labour or Conservative—was more responsible for the decline of the United Kingdom economy.

That was a ferocious battle, but unity has broken out today. Mr Brownlee and Mr Whitton are back in the same club—the council tax club for Labour and the Conservatives. They are determined to put on a show of unity today because the Conservatives were responsible for a 40 per cent increase in the council tax when they were in power and the Labour Party was responsible for a 60 per cent increase in the council tax when it was in power. No wonder they have been brought together in unity.

However, Mr Whitton should beware of the trap that Mr Brownlee has set for him. It is implicit in the motion, in which Mr Brownlee says we should consider all these options:

"reform of the council tax, a land value tax, a local income tax with variable rates determined locally and the Scottish Government's own proposals."

Of course, that presumes that the Labour Party has something to contribute to the debate. Mr Iain Gray, the Labour leader who was installed on 4 October, said candidly:

"We don't have our own proposals. ... We went into the 2007 election with a proposal to try and make the council tax fairer"—

Mr Brownlee's position—

"and it didn't add up. Central to our new manifesto is a properly worked out suggestion for how we make the council tax fairer."

There is not a scrap of evidence to suggest that Labour is anywhere close to producing that.

There are quotations not just from Mr Gray but from Mr Kerr, who in his aspirational moment when he wanted to be leader of the Labour Party in Scotland, said:

"I would immediately signal a long-term desire to replace the council tax."

Mr Kerr obviously cannot support the motion, because it accepts to some extent the continuation of the council tax.

The man of wisdom on the Labour benches, who is unfortunately absent today—the man worth listening to on the Labour benches—is the former Minister for Finance and Public Service Reform, Mr McCabe, who said on 3 August that the council tax is an "unfair burden" and that Labour must back

"a firm timetable for abolition."

He said that the plan to reform the council at the previous election was "a pointless fudge" presented as "a radical change". The Labour Party should be very careful about the trap that the wily Mr Brownlee has set for it today.

Photo of Derek Brownlee Derek Brownlee Conservative

I was just wondering whether the cabinet secretary would listen to the man of wisdom on the Scottish National Party benches, Fergus Ewing, who said in 2006:

"It is reasonable to say that the council tax per se is not unfair".—[Official Report, 1 February 2006; c 22919.]

Photo of John Swinney John Swinney Scottish National Party

We are a broad church that is prepared to tolerate open debate, unlike the "Stalinists" on the Conservative benches.

I am afraid that, despite Mr Brownlee's logical presentation—or his best efforts at it—the Conservative position is completely and utterly all over the place. On 2 October, Mr Brownlee moved a motion that called on the Scottish Government to "publish in detail" the impact on local authority revenues

"prior to the introduction of a council tax abolition Bill

He accepted that we are going for council tax abolition. That prompted me, in one of my more generous moments, to say:

"I welcome the debate and the indication in the Conservative motion and the Labour Party amendment that those parties are at last coming to terms with the fact that change to local taxation is coming."—[Official Report, 2 October 2008; c 11384.]

Today, we have a U-turn—a volte-face. We have seen the introduction of a new concept to the parliamentary etiquette—the multi-option bill. That is strange from a party that is so vehement in its opposition to a multi-option referendum on the constitutional question, which I heard Ms Goldie wax lyrical about some weeks ago. The Conservatives are chopping and changing their position without any certainty about where they are going.

Photo of Gavin Brown Gavin Brown Conservative

To save time, will the cabinet secretary tell us whether the Government is going to capitulate to the Liberal Democrats and have a locally variable rate?

Photo of John Swinney John Swinney Scottish National Party

Mr Brown just does not enter into the spirit of decent parliamentary debate. We are working together with the Liberal Democrats to reach consensus, as the First Minister set out so eloquently on that wonderful day when he became First Minister, when he explained how we would bring people together. Even Mr Purvis and I have been brought together in agreement today. I look forward enthusiastically to Mr Purvis's speech, of which I am sure I will approve; I will just slip my speech over to him.

The council tax is unfair and regressive. It dominated the election campaign and people throughout the country have realised that it has no credibility. The party that was its principal advocate was ousted from office because it had no credibility on the council tax.

We believe in a local income tax that is based on the ability to pay, which will reflect the interests of the people of Scotland. We are determined to press ahead with that reform.

I move amendment S3M-3014.2, to leave out from "calls on" to end and insert:

"believes that the council tax is discredited and should be abolished and that a local income tax based on ability to pay is a fairer system of local taxation, and calls on the Scottish Government to publish early in 2009 its detailed response to the consultation on local income tax for debate by this Parliament."

Photo of Jeremy Purvis Jeremy Purvis Liberal Democrat 10:40 am, 4th December 2008

I am not sure whether I can compete with the members of the council tax club or with the Very Rev John Swinney of the SNP broad church. I will, however, point out that—just last week, I think—Derek Brownlee demanded "clarity and certainty" about the legislative proposals that the SNP was due to bring forward, but now he is calling for greater confusion. He said that businesses want—need, in fact—a clear statement on the proposals that are to be brought forward in the spring. Now, he is calling for everything to be cast up in the air again. Two years ago, Mr Brownlee castigated the Burt review of local government finance and said that it was a complete waste of time. Now he wants to reconvene the commissioners to start that work all over again.

The publication of the bill by the Scottish Government will give Parliament an opportunity to consider the general principles of a system of local taxation that is based on the ability to pay and which is progressive and fair. Those are the general principles that Liberal Democrats support. I hope that that will get cross-party support in the chamber.

Photo of Hugh Henry Hugh Henry Labour

Can Jeremy Purvis confirm that the Liberal Democrats will not support the bill unless it includes the provision for each council in Scotland to set a local rate of income tax at the outset?

Photo of Jeremy Purvis Jeremy Purvis Liberal Democrat

Mr Henry asks me to address the amendment in my name, which I am happy to do. If parties support the amendment, that will give a clear signal that Parliament supports not only councils having flexibility in expenditure but their being available to them variable rates of local income tax for local government revenue. Our position is clear: we do not support a national system of local taxation. Local taxation has to be local; otherwise, it is a national income tax addition, which we simply do not support.

It is interesting that the debate this week has been about the financial powers of this Parliament. There has been little debate about the financial powers of local government. Derek Brownlee is right to some extent that this debate is a once-in-a-generation opportunity. He also said that he regrets that the approach might well be dogmatic. I concede that the council tax is not a dogmatic policy, because it replaced a dogmatic policy. The council tax was crisis management—it replaced the poll tax—and was neither consistent with the core understanding of what local government powers should be, nor was it fair or progressive.

We have the ability to correct a 17-year wrong. That should be based not on a toom tabard of a concordat with local government, but on a proper fiscal relationship that will, in the long term, move to parity for local government for the revenue that it raises and the expenditure for which it is responsible. The structure for that should be based on principles that are similar to the principles for which we are arguing in the fiscal relationship with the UK.

We are still waiting for the Labour Party's response. After the debate in October, I wrote to Iain Gray asking for Labour's policy proposals. He wrote back saying that Mr Kerr would reply on his behalf. I am still waiting for that letter. I suspect that it will be part of a round-robin or a Christmas card.

I hope that other parties will bring forward their proposals. We have had some tinkering at the edges from the Conservatives, but everyone should understand that their core belief is that the council tax is fair. The Conservatives are wrong in that—communities throughout Scotland know that they are wrong. By voting for our amendment to the Government's amendment, we will send a strong signal of support for a local tax that is fair, progressive and based on the ability to pay.

I move amendment S3M-3014.2.1, to insert at end:

", giving further consideration to a system of local taxation that includes local variability, protection for those in full-time education, transition support for businesses and appropriate taxation for people receiving high levels of income from dividends."

Photo of David Whitton David Whitton Labour 10:44 am, 4th December 2008

I am very happy to take part in today's debate on local government finance, and I will be speaking in support of the motion in the name of Derek Brownlee. Yesterday we were foes, today we are friends. Such is politics. If it is all right, in the spirit of parliamentary debate, for the SNP and the Liberal Democrats to get together, I see no reason why Mr Brownlee and I cannot get together in this particular case—especially as the very successful local council in East Dunbartonshire is run by the Labour and Conservative parties together.

Albert Einstein once stated:

"The hardest thing in the world to understand is the income tax."

He could have added "local income tax in particular". I agree with Einstein's assessment. If one of the greatest minds of any generation struggled with the concept, I am certainly not alone in questioning the SNP's proposed local income tax or, indeed, the Liberal Democrat variant. The proposed local income tax is simply another diversion by an SNP Government whose economic policy is beset by dither and decay. SNP members love to criticise the council tax, but they would do better to focus on the flaws in their own proposed system and to seek answers to the numerous problems that exist with local income tax. If they do not do that, they should just drop the idea altogether.

The SNP touts its support for the policy, but a look at the consultation numbers reveals a very different picture. The SNP's consultation on the popularity of local income tax drew what are described in show business as "mixed reviews". Although 55 per cent of individual respondents believe that the local income tax is the fairest approach to taxation, only 34 per cent—about a third—of people aged between 34 and 54, who make up the bulk of the working population, support a local income tax. Within that same demographic, 40 per cent of 34 to 44-year-olds and 43 per cent of 55 to 64-year-olds feel that the council tax is fairer. Only 47 per cent of those who were polled are full-time employees, who would suffer the most from the switch. Support for a local income tax is much different from what the SNP would have us believe, and it is certainly not at anything like the levels that the First Minister brags about.

Furthermore, the headlines do not reveal the mixed reviews that local income tax is getting from business.

Photo of Brian Adam Brian Adam Scottish National Party

Will David Whitton at least do us the courtesy of conceding that local income tax is rather more popular than the council tax, reformed or otherwise?

Photo of David Whitton David Whitton Labour

No I will not, because I do not see the evidence to back up that assertion.

The key theme from organisational responses to the consultation is that more information is required on local income tax before any sort of decision can be reached. Naturally, the SNP has delayed getting the answers to the business community. Clearly, there is a lot of concern during these troubling economic times about any sort of change to the tax structure.

Photo of David Whitton David Whitton Labour

Liz Cameron, chief executive of the Scottish Chambers of Commerce, said:

"It is extremely disappointing the Government are planning to press ahead with legislation to introduce a Local Income Tax in Scotland without addressing the widespread concerns among the business community regarding such a measure."

The overwhelming support that the SNP claims simply does not exist. In addition, the introduction of local income tax in Scotland would complicate the relationship between Scotland and the rest of the UK. Income taxes are not as black and white as property taxes. What happens to people who work in London during the week but who reside permanently in Scotland? As is shown by the relationship between Sweden and Denmark, income taxes only complicate relationships. There is a bridge that allows easy travel between Malmö in Sweden and Copenhagen in Denmark.

Photo of David Whitton David Whitton Labour

No, I will not—I am in my last minute. I am sorry.

What happens to the commuters who work in Denmark and live in Malmö? Through redistribution, the Danish Government must pay almost £37 million to the Swedish Government to compensate for loss of revenue, which causes the city of Malmö to lose out.

Photo of David Whitton David Whitton Labour

Presiding Officer, I could speak all day about the flaws of local income tax but, sadly, time does not allow me to do so. Suffice it to say that we will support the Conservative motion.

Photo of David McLetchie David McLetchie Conservative 10:49 am, 4th December 2008

This is a Parliament of minorities and, since the welcome demise of the Labour-Liberal Democrat coalition, it is a Parliament in which a majority has to be constructed on every issue and in which, other than in the unlikely event of Labour and the SNP ganging up on the rest of us, the support of at least three parties is required for a majority. I believe that to be a healthy situation that is broadly welcomed by people in Scotland of all political persuasions, and that our Parliament is the better for it.

Local government taxation has been a contentious issue for the past 30 years. It is a subject on which there are significant differences of opinion in this Parliament and in Scotland's other Parliament. Three parties broadly support a property-based tax, ameliorated by discounts and benefits, and referable to the financial circumstances and nature of the household that occupies any particular property. Two parties believe in introducing a local tax based on income.

Those broad lines of division mask significant differences among the parties on both sides of the property tax versus income tax debate. The Greens advocate a land value tax, while the Conservatives support the introduction of pensioner discounts for council tax. The Labour Party and others want council tax levels to reflect the energy efficiency of homes as a spur to achieving a sustainable energy policy. Equally, on the local income tax side of the argument, there are considerable differences between the Scottish National Party and the Liberal Democrats as to the form and scope of such an income tax.

The motion seeks to reflect that diversity of opinion in the Parliament. We do not think it right for the terms of debate to be framed solely by those who want to abolish a property-based tax and introduce an income-based tax. We believe that the scope of the proposed bill should be sufficiently wide to enable all parties to put forward their proposals and to seek to build a majority for a reformed system of local government taxation. That, we submit, is the fair way to proceed, and it should appeal to all fair-minded people.

Photo of Brian Adam Brian Adam Scottish National Party

Would it be fair to characterise the Conservatives' proposal as seeking an enabling bill that would allow ministers to make statutory instruments to introduce any kind of local taxation that they might choose?

Photo of David McLetchie David McLetchie Conservative

No, we certainly would not support that proposition. We believe in real debate, not the few minutes that Mr Adam wants for debating a Scottish statutory instrument.

Our proposals should be supported across the chamber, but, as we know, that will not happen. I am disappointed by the sterile and partisan nature of the amendments that were lodged by Mr Swinney and Mr Purvis. I was particularly intrigued to note in the Business Bulletin that Mr Swinney's amendment is expressly supported by Jim Mather. I regret that Mr Mather will not be speaking in the debate. He has been conspicuously silent on the subject of local income tax. I wonder whether he, as a self-proclaimed friend of the Scottish business community, is embarrassed by the fact that every single business organisation in Scotland has denounced local income tax. I wonder to myself whether local income tax might be another TPRA moment for Jim Mather—I refer to the third-party right of appeal, the policy that he really hates and cannot wait to dump at the first convenient opportunity. We should watch this space—we should watch Mr Mather very carefully on this one.

I was delighted to note the participation of Sir Sean Connery in the homecoming television advert. I am sure that we would all welcome the permanent homecoming of Sir Sean, and no one more than Mr Swinney, given that the resumption of tax residence in Scotland by Sir Sean would go a significant way towards plugging the gaping financial hole in Mr Swinney's local income tax plans. I ask myself whether Sir Sean might once again ride to the rescue of the Scottish National Party in its hour of financial crisis. On this occasion, I do not think so, but we never know.

I support the motion.

Photo of Frank McAveety Frank McAveety Labour 10:53 am, 4th December 2008

It is always a pleasure to follow David McLetchie and his erudite commentary on the issues under debate. Like many members, I, too, welcomed the recently produced homecoming Scotland video. Incidentally, the video is to be shown only in cinemas in Scotland, rather than in cinemas across the world, so a lot of people will be making a five-mile journey home, rather than the 3,000-mile journey home that we expected.

Sir Sean said:

"I think about you all the time", but he will be chuckling at the fact that he will not be making a contribution under local income tax.

In his entertaining turn, John Swinney made no reference to any of the substantive points that have been raised in the motion and in the recent public debate. Perhaps he will welcome the opportunity to amplify the issues in the near future.

John Swinney also made no reference to the issues that were raised in the consultation response that he snuck out at the crack of dawn on a much more difficult news day than anyone could imagine. He did not mention the views that the Scottish Chambers of Commerce expressed last week or those of local authorities, which for a number of years have wanted to protect their autonomy against intrusion by central Government. He made no mention, either, of the concerns that many other public sector bodies have expressed about the impact on the voluntary sector if there was a shortfall in funding. Mr Swinney's speech might have been entertaining, but those are substantive matters of interest that we need to interrogate.

John Swinney referred to old-time religion. I am a great believer that a sinner can repent and, when he is at the penitence stool, identify where he got it wrong. One member of the Scottish Chambers of Commerce said that LIT could have a "positively spine-chilling" impact on small businesses across Scotland.

In 1988, I became a member of the City of Glasgow District Council during the difficult days of the poll tax—I am sure that Conservative members went through that bitter experience. We were assured that the introduction of the poll tax would not have a significant impact on individuals or communities and that it was a reasonable response to concerns about the old rates, but the result was extremely negative. That is my concern about LIT, which does not address some of the fundamental issues to do with the funding of local government services.

When Mr Swinney mentioned Stalinists, I was reminded of the novel "Nineteen Eighty-Four" by George Orwell, in which those in power used Newspeak to restrict the nature of the debate and the language that could be used. They tried to remove from the language certain words that could be used to describe their policies. Something that was bad could not be described as such, so a new word, "ungood", had to be invented. The words "excellent" or "splendid", which I have heard Mr Swinney use about local income tax, became "doubleplus good". I do not think that LIT is doubleplus good for those who need local government-funded services; in fact, I would call it doubleplus bad, because it makes three fundamental mistakes.

First, LIT is not a local income tax because it would be set nationally. Secondly, it would not give local government the autonomy to set taxation levels that would be appropriate locally. Thirdly, and most fundamentally, the Scottish National Party said at the last election that it wanted to remove the unfair council tax, but it did not complete the sentence. That is the problem with the policy that the cabinet secretary is defending—it does not complete the sentence, in that it does not deal with the impact that LIT would have. On that ground, I am happy to support the motion, which at least articulates the view that we want a better way to fund local government services than a local income tax.

Photo of Joe FitzPatrick Joe FitzPatrick Scottish National Party 10:58 am, 4th December 2008

It is with a sense of déjà vu that I find myself again speaking in a debate on local government finance, but I accept that as the abolition of the hated and unfair council tax is top of the list of our constituents' concerns, it should be at the top of the Parliament's agenda.

It has been 21 months since the SNP announced its proposals for scrapping the council tax and introducing a fair local tax that is based on ability to pay. After all that time, we have still not heard about any real alternatives to those proposals.

Photo of Joe FitzPatrick Joe FitzPatrick Scottish National Party

I will deal with the Conservatives' position shortly.

Let me be clear: doing nothing is not an option. The people of Scotland will not forgive any party that stands in the way of the SNP Government's bill to abolish the council tax.

In relation to his motion, I remind Mr Brownlee that it is the job of Opposition members to come up with alternatives to the Government's proposals when they disagree with them. I will give credit where credit is due—Mr Brownlee has suggested tinkering with the hated council tax, but he must publish his workings because the sums just do not add up.

Some parties have been quite open about their lack of alternatives to the council tax. As Mr Swinney has already quoted what Iain Gray said last October, which was also mentioned in Parliament yesterday, it would be unfair of me to repeat it, but Mr Gray accepted that the Labour Party had no proposals and that the suggestions to tinker with the council tax that it made in the campaign for the most recent parliamentary elections were worked out on the back of a cigarette packet.

Photo of David Whitton David Whitton Labour

Does Mr FitzPatrick share my view that it was the SNP's policy on local income tax that did for it in Glenrothes?

Photo of Joe FitzPatrick Joe FitzPatrick Scottish National Party

I have no idea why the people of Glenrothes did not vote for the best candidate. We will learn lessons to ensure that that never happens again. I am quite convinced that the progress that the SNP is making throughout the country will continue at the next election.

Mr Gray said that the Labour Party was working on new proposals for making the council tax fairer, but so far we have heard nothing. However, given that he is often seen clutching a fag packet with a determined look on his face when he leaves the chamber after First Minister's questions, perhaps he is indeed working on Labour's new proposals, which were conspicuously absent from the consultation process. Labour's position remains that it knows that the council tax is unfair, but it does not know what to do about it.

Neither Labour nor the Conservatives have mentioned what is, when it comes to the retention of the hated council tax, the elephant in the room—the much-delayed but ultimately unavoidable council tax revaluation. The revaluation that took place in Wales led to 65 per cent of properties in Cardiff being moved up by at least one band.

Photo of Derek Brownlee Derek Brownlee Conservative

The revaluation in Wales led to a 5 per cent increase in the overall tax take. It is perfectly feasible to do a revaluation on a revenue-neutral basis.

Photo of Trish Godman Trish Godman Labour

You should be finishing now, Mr FitzPatrick.

Photo of Joe FitzPatrick Joe FitzPatrick Scottish National Party

Mr Brownlee and the Labour Party need to be open—they must tell the people of Scotland when they propose to carry out a revaluation. It is not possible to keep the council tax without having a rebanding.

I conclude by highlighting the views of one of the respondents to the consultation on local income tax. Scottish Action Against Council Tax shares the views of the majority of Scots. That organisation, which is made up of ordinary Scottish taxpayers from around the country, stated that it does not want the council tax to be tinkered with or any one-off payments or reductions to be made; it wants that hated tax to be scrapped altogether and replaced by a fairer local income tax that is based on ability to pay. That is what the people of Scotland want, which is why the SNP Government will introduce the council tax abolition bill, not the council tax version 2 bill.

Photo of Margo MacDonald Margo MacDonald Independent 11:02 am, 4th December 2008

I might never have made this speech if Alex Salmond had only replied to the letter that I wrote to him at the general election to inquire about his plans for local income tax. That said, my speech should not be interpreted as offering support for what we must call "the hated council tax". I prefer an income-based tax to a property-based tax. I remind Frank McAveety that the criticism of the poll tax was that the duke would pay the same as the dustman. His speech contained just a hint of Orwellian doublespeak.

I have always doubted whether a local income tax could be bolted on to a comprehensive and cohesive tax system such as the one that we have in the United Kingdom. The Government's consultation paper on LIT asks who should collect the tax and whether it should be collected at source, by payment—by the taxpayer, I presume—or by a combination of the two. That is the Achilles' heel of LIT in the devolution setting. In an independent country that had its own central tax-collecting authority, there would be an instrument to instruct on LIT collection, but that is not the case in a devolved Scotland.

Paragraph 29 of the consultation paper states:

"We will work with the UK Government to ensure that processes are thoroughly tested before implementation."

That clearly implies that HM Revenue and Customs, with the agreement of the UK Government, will be the LIT collection instrument, and that the UK Government will be asked to legislate to ensure that employers, who represent the first tax collection point, are required to calculate and deduct the tax and then to send it to HMRC for onward transmission to the Scottish Government. It is difficult to see how any body other than HMRC could be the collection instrument, because if the Scottish Government set up its own equivalent, that would eat deeply into the block grant that we get from Westminster.

What puzzles me is why, despite the number of times that the First Minister has reaffirmed his determination to go ahead with LIT, we have not heard anything substantial about the Government's discussions with HMRC and the UK Government.

A constituent of mine who does voluntary research, a Mr Sillars—[Laughter.]—made a freedom of information request to HMRC dated 3 October. He asked for copies of correspondence—including memos and notes—between the Scottish Government and HMRC since the 2007 election on HMRC becoming involved in the collection of the SNP Government's local income tax and for any similar material from previous parliamentary sessions. He received this reply:

"I am writing to inform you that following a search of our paper and electronic records, I have established that HMRC does not hold the information you have requested."

Before any bill is published, we need to know the position regarding collection by HMRC: whether it will do it, what the cost will be, and whether we believe that it will be able to do it accurately, given that department's poor record on tax credits. If HMRC is not the chosen instrument of collection, what will be chosen, how will it be established, at what cost, and what confidence can we have that it will do the job properly?

All that I have said is, of course, predicated on the Scottish Government's proposal for a national LIT—if that is not a contradiction in terms. When it comes to 32 variable taxes, it is all the more imperative that the bill spells out the detail, complexity and cost. That is why I find it very difficult to support the Government's proposition on local income tax.

Photo of Duncan McNeil Duncan McNeil Labour 11:06 am, 4th December 2008

I suppose that today's divisions on the issues of fairness and what will replace the hated council tax are only to be expected. We have also heard the Scottish Government's analysis from Joe FitzPatrick, which shows that the division exists in the country too.

The consultation showed that groups that make up the working-age population are less supportive of local income tax than groups of older people. Only 10 of the 86 organisations that submitted views supported local income tax. Less than half said that it would be better for the economy, and less than half of the individuals who responded said that the proposed rate was correct.

My question is: how would those people know? How are they able to compare the local income tax system with a range of systems? How can individuals know how fair an income tax would be unless they know what they would be asked to pay? We still do not know that. We do not know whether the exemptions for students and the armed forces would go or stay. We do know whether people would be taxed on the current year's earnings or on the previous year's earnings.

Would it be considered fair for people in Greenock to pay 6p in the pound while people in Eastwood paid 4p in the pound? The business community would willingly agree that a cut in the business rate was fair, but we know that the impact of cuts on communities and the quality of services would not be considered fair. How would the principle of comparable service levels be maintained if there were different levels of taxation across the country?

Photo of Jeremy Purvis Jeremy Purvis Liberal Democrat

Will the member explain why he is defending a system under which a taxpayer in his area could pay £1,050 while a taxpayer in my area paid £1,000? It is a question of local accountability. Why is local accountability fair for a property-based tax but not for an income-based tax?

Photo of Duncan McNeil Duncan McNeil Labour

The division in the chamber is about replacing that system. There is broad agreement that the current system needs to be amended or replaced, and we are discussing how we test the fairness of different systems. If we have only one option—local income tax—rather than a range of options, how can we make that judgment? We are in a deep economic crisis, with unemployment expected to increase in Edinburgh. What would local income tax bring to local government finance in Edinburgh if the tax base collapsed?

Why are we still waiting? As Joe FitzPatrick said, it is 21 months since the policy was launched. The Chartered Institute of Public Finance and Accountancy, a leading professional accountancy body for public service, has asked why we are still waiting for the promised detailed route map towards a local income tax. Critical issues have still not been answered, including the loss of the financial autonomy and accountability of local authorities and their democratically elected members—no small matter—and the £750 million annual shortfall. That professional body's strong recommendation was that the Scottish Government needs to be clearer on the detail. I agree. Only then will we be in a position to pass judgment on any new tax to replace the hated council tax.

Photo of Brian Adam Brian Adam Scottish National Party 11:11 am, 4th December 2008

The Conservative proposal before us is an unusual beast. Despite Mr McLetchie's denials, I find it difficult to see it as a proposal for anything other than an enabling bill. He is asking the Government to introduce a bill that offers a range of options. I presume that he has painted in all the options that are currently under debate, but as he is such a democrat, with such strong feelings about the effectiveness of a group of minorities running the country, I assume that he has not ruled out any system of taxation.

I find it hard to understand how Mr McLetchie can expect a Government to introduce the Opposition's proposals in a Government bill. Without wishing to dismiss other people's views, I find that an unusual approach to democracy.

Photo of Brian Adam Brian Adam Scottish National Party

If Mr McLetchie wants to explain his approach, I will be delighted to listen.

Photo of David McLetchie David McLetchie Conservative

We ask simply that the scope of the bill is such that we can introduce our own proposals. We do not need the Government to draft our proposals for us; we are more than capable of doing that—and of producing a more effective outcome than I am sure the Government will.

Photo of Brian Adam Brian Adam Scottish National Party

Given that the Conservatives are not currently in government, minority or otherwise, I do not think that it is our responsibility to introduce an enabling bill that allows them to lodge the amendments that they want. If they do not care for the Government's approach, they will have the opportunity to vote against it.

The Conservatives' proposal, which is for what must be an enabling bill, has no credibility. It is clearly just a device to gather a grouping of those who oppose local income tax to support a motion. It is not a serious proposal for a serious bill.

Having listened to several Labour members, I am disappointed that we do not yet have any idea what their alternative is. At least Mr McNeil described the council tax appropriately as "hated"—I perhaps picked him up wrong, but I thought that that is what he said. There is no doubt that the council tax is absolutely discredited. The Government, with some Liberal Democrat allies—who knows what will happen at 5pm tonight?—at least has a credible alternative.

Mr McNeil pointed out some aspects of the consultation. However, only five of the organisations to which he referred suggested that the council tax was the fairest way to proceed. There is no doubt that all the objective evidence suggests that local income tax is the fairest way to proceed.

If we are to debate alternatives, we need to have those alternatives. This is the time to have the debate about alternatives, not when we are introducing a bill, because a sensible bill can be about only one proposal. There may be debates on the nuances of that proposal, but an enabling bill is not credible, and it does the Conservatives no credit whatsoever to propose one.

The Government's LIT proposals make a lot of sense, and they clearly carry support in the country. If the Tories and Labour do not have alternative proposals, they should accept the will of the Parliament, which, following the two previous debates, has been to allow LIT to proceed. If they do not want to support the bill, they can vote against it when the time comes.

Photo of Hugh Henry Hugh Henry Labour 11:15 am, 4th December 2008

Unusually, I agree with Joe FitzPatrick: the Conservatives need to publish the figures to justify and sustain their arguments. However, I hope equally that John Swinney will listen to his exhortation and publish an analysis of the cost to small business of administering the local income tax. Joe FitzPatrick cannot justifiably ask the Conservatives to publish the figures that justify their arguments while failing to ask ministers of his party to publish the figures that justify theirs.

Photo of Derek Brownlee Derek Brownlee Conservative

I do not particularly blame Hugh Henry for not reading everything that comes out of the Scottish Conservative press office. However, we revealed our proposal for a pension discount in our manifesto and fully costed it last year; our submission to the local government finance consultation, which Mr Swinney talked about, was the longest of any; and, in September, we published our proposals for an across-the-board discount, so we cannot be accused of not publishing our proposals.

Photo of Hugh Henry Hugh Henry Labour

I made no accusations; I merely said that I agreed with Joe FitzPatrick's exhortation and that he needs to speak to John Swinney about publishing figures. I welcome the thrust of Derek Brownlee's speech and congratulate him on it. It was measured and well set out. He is right to point to the futility of introducing a controversial taxation proposal in a Parliament such as this, given the uncertainty that the country might face after the next election and the further turmoil that would follow from that.

At some point, we need to consider what Brian Adam said about how much support there is. Joe FitzPatrick grandiosely stated that local income tax is what the people of Scotland want. Indeed, in the Paisley Daily Express this week, a nationalist parliamentary candidate welcomed the results of the Scottish Government's consultation on council tax. He said:

"I'm glad and yet unsurprised that the people of Scotland have given their backing to the SNP's proposal".

On what basis does he say that the people of Scotland have done that? He says:

"more than half of all individual respondents supported the SNP's proposals".

There were 430 respondents, 55 per cent of whom supported the proposals. In other words, only 237 people were in favour. That is what he calls the people of Scotland: 237 in favour.

Joe FitzPatrick described Scottish Action Against Council Tax as the voice of the people of Scotland, but I have never heard of that organisation. That shows the reality of the SNP's proposals. According to the SNP, 237 people represent the people of Scotland. However, its own analysis of the consultation responses says that

"Given the primarily self-selecting nature of" the consultation exercise, the numbers could not be said to be representative.

The most damning point of the whole argument is the one that Margo MacDonald made about collection. She is absolutely right about the problems that would arise from trying to collect local income tax through HMRC. She is also right to say that, in an independent country, one could reasonably aspire to what the SNP proposes. However, with the dog's breakfast of proposals hidden from the people of Scotland as they are just now, the Parliament cannot reasonably draw any conclusion on any proposal.

When people are asked about their views on taxation, they may know what they are against. However, so far, the detail of the proposals that are on offer from the SNP and the Liberal Democrats has been hidden from the people of Scotland. If we are to justify ourselves as a truly democratic, representative Parliament, that detail needs to be published.

Photo of Alison McInnes Alison McInnes Liberal Democrat 11:19 am, 4th December 2008

I am not sure that I have been much enlightened by the debate. When I first read the Conservative motion, I was reminded of my childhood Saturday mornings at Woolies pick-'n'-mix: "Oh dear, we really can't decide what we want, but that's okay—we can have a wee taste of everything." I realise that I am a newcomer to the Parliament, but it is the first time that I have come across the pick-'n'-mix, multi-option bill, and I am glad to hear that Brian Adam—who is far more experienced than I—is also perplexed by that suggestion.

Of course, during the debate, the Tories confirmed that their favourite sweetie would be the retention of the council tax. I do not think much of their choice. Under that option, people on the highest incomes would benefit more than pensioners and low-income families. The proposal may be superficially attractive, but it would leave many of the poorest in our society out in the cold.

The Labour Party has been vociferous in its opposition to local income tax based on the ability to pay but, as yet, less than forthcoming about how it plans to tackle the gross inequities of the council tax system, under which the poorest 10 per cent pay four times more of their income than the richest 10 per cent do. The Labour Party has confirmed its membership of what Mr Swinney referred to as the council tax club, but it has not yet come up with a workable alternative.

Hugh Henry criticised our proposals by saying that they would burden local businesses with collection charges, but he failed to point out that, for many years, his Government asked local businesses to collect tax credits and that, with one week's notice, they were asked to change VAT—a heavy burden on them. Thousands of low-income households struggle under the punitive burden of the council tax. Does Iain Gray still believe, as he did two months ago, that that system is unfair? If so, when will he tell us what he wants to replace it with?

Earlier this year, a survey of 30,000 users of the internet service MSN money put council tax as the most hated tax—above fuel duty, inheritance tax, VAT and income tax. We know that it is a regressive and unfair tax that simply cannot be fixed. We want to replace it with a fairer local income tax that is based on the ability to pay.

Photo of Hugh Henry Hugh Henry Labour

What did the Liberal Democrats ask the wider public about what they believed the implications of a 6p local income tax might be, and what were the results?

Photo of Alison McInnes Alison McInnes Liberal Democrat

The survey was not ours; it was carried out by MSN money, as I said.

The Scottish Liberal Democrats are prepared to work with the Scottish Government to abolish the council tax and introduce a fairer system. However, as Jeremy Purvis said, the current proposals do not address some key issues, including the protection of students, the accountability of local councils, support for small businesses and appropriate taxation for people who receive high levels of income from dividends. We will continue to pursue those issues with the Government and make constructive proposals.

Photo of Alison McInnes Alison McInnes Liberal Democrat

No, I am in my last minute.

Changes to the council tax are overdue, but it contributes only a small percentage to the pot of local government funding, and other inequalities in the local government settlement need to be addressed. Local authority discretion and accountability should be strengthened. Unfortunately, the council tax freeze and that audacious con, the concordat, have weakened those principles. This year, local government is even more dependent on central Government hand-outs. That is an unhealthy relationship, as it allows central Government too much control over what happens locally and leads to less local transparency in decision making and less local accountability. I am sure that there must be a fairer and more transparent way of allocating resources to local government.

The Liberal Democrats would like the vagaries of the local government formula to be addressed. If Aberdeen City Council was funded at the same level per head of population as Dundee City Council, it would have an astonishing £104 million extra every year to spend, so it is little wonder that Aberdeen City Council is struggling to cope with its budget allocation. A fairer system must be found.

We want a fairer system of taxation that is based on the ability to pay. It must be truly local and address issues such as the protection of students, support for small businesses and appropriate taxation for people who receive high levels of income from dividends.

Photo of David Whitton David Whitton Labour 11:24 am, 4th December 2008

Nothing that I have heard persuades me that the introduction of local income tax will be good for Scotland and the Scots. Indeed, it is clear that, contrary to what the First Minister and the SNP claim, there is no massive majority in support of the new nat tax.

As I pointed out in my opening speech, only 34 per cent—that is, just over a third—of people aged between 34 and 54, which is the main working age, believe that local income tax is the fairest approach to taxation. That contrasts with the SNP's spin on the local income tax consultation. It claimed that 55 per cent of individual respondents to the consultation thought that local income tax was fairer. I am grateful to my colleague Hugh Henry for exposing that nonsense for what it was. The devil is in the detail.

On the subject of detail, fewer than half of the individuals who responded thought that local income tax would provide a wealthier Scotland. That view is shared by Scotland's business community, whose principal representatives held face-to-face talks with Mr Swinney last week. We do not know exactly what was said, but we can guess that the Confederation of British Industry Scotland, the Scottish Council for Development and Industry, the Institute of Directors, the Scottish Chambers of Commerce, the Federation of Small Businesses Scotland and Scottish Financial Enterprise were less than complimentary about the proposals, given that those organisations have loudly condemned local income tax. Indeed, I remind Mr Swinney of what was said in public forum by Norman Quirk on 19 November, at the Scottish Chambers of Commerce annual dinner. Mr Swinney had to sit and squirm as he heard Mr Quirk say:

"Even in an economic boom time, the risk to Scottish competitiveness would be worrying; in the current climate it is positively spine-chilling. Our clear message to the Scottish Government and the supporters of a local income tax is to listen to the overwhelming view of the Scottish business community and think again."

It is a wonder that Mr Swinney continues to go to business dinners. They are clearly bad for his health.

Photo of Margo MacDonald Margo MacDonald Independent

Would the Labour Party support a progressive income-based tax if it were part of a cohesive system of taxation, or does it support a property-based tax per se?

Photo of David Whitton David Whitton Labour

We support a property-based tax per se.

Mr Swinney was, as always, good on rhetoric but short on comment about the local income tax consultation. Mr FitzPatrick did his best to push the party line but had no answer to the Glenrothes question. To be fair, neither does his leader, Alex Salmond. Suffice to say that the SNP was sent homeward to think again, as the song goes. Labour Party members think that it is time for the SNP and Liberals to think again about local income tax.

Photo of David Whitton David Whitton Labour

I am sorry. I have only four minutes.

The Government says that its primary purpose is the growth of the Scottish economy and the creation of more jobs. Did it not listen to Mr Quirk? Has it not heeded the views of the business community and the Scottish trade unions? Has it paid any attention to the views that were expressed during the consultation, particularly by people who are of working age?

Local income tax will penalise carers, armed forces personnel, families in receipt of tax credits and the disabled. Unless Mr Swinney and the SNP and the Liberals do the right thing, it will also penalise the whole of Scotland.

Photo of John Swinney John Swinney Scottish National Party 11:27 am, 4th December 2008

Margo MacDonald asked about the extent of contact between the Scottish Government and HMRC. Frank McAveety asked a similar question a couple of weeks ago at question time. What I put on the record in response to Mr McAveety remains the case. Her Majesty's Government has requested that the Government in Scotland take forward its discussions about the implementation of local income tax primarily with the Treasury.

We have had contact with the Treasury. We have also had discussions with the Department for Work and Pensions, the Ministry of Defence and HMRC. I met the Chief Secretary to the Treasury to discuss the issue and Treasury officials have been involved in discussions. A process of dialogue is under way and we have a detailed proposition to put forward, which we will discuss with the UK Government.

Photo of Hugh Henry Hugh Henry Labour

Can the cabinet secretary enlighten us about whether, in any of the discussions that he mentioned, the UK Government has indicated a willingness to collect the tax on behalf of the Scottish Government and return it to local authorities?

Photo of John Swinney John Swinney Scottish National Party

The UK Government has said that it will consider the proposals that we put forward. That is why we are taking forward discussions, which perhaps reflects the mature way in which the Scottish Government goes about its business with the UK Government.

Much comment has been made on the consultation exercise that the Government carried out. Let me put on the record that 55 per cent of respondents considered local income tax to be the fairest approach to taxation, compared with the 25 per cent who supported the council tax. Numerous recent opinion surveys have shown that somewhere in the order of 60 per cent of the public support local income tax. I gently point out to members that the issue predominated during the parliamentary election campaign, in which the council tax parties did not do well.

Photo of Derek Brownlee Derek Brownlee Conservative

Mr Swinney said that 55 per cent of respondents favoured a local income tax. Does he agree that the 57 per cent of respondents who favoured a nationally rather than locally set tax should be listened to? Will those respondents' views be taken into account?

Photo of John Swinney John Swinney Scottish National Party

Ministers always reflect on the contents of consultation exercises and will continue to do so.

At the heart of the issue is whether we decide to make progress on local government taxation. Back in 1998, when Mr McAveety was the leader of Glasgow City Council, he had to come to terms with a defeat by the SNP in the Garrowhill by-election. He said:

"Labour voters in Garrowhill gave us a clear message. We've got to get our act together on such issues as the high council tax."

That was in 1998, but the Labour Party is still flailing around trying to reach an answer on what to do about the council tax.

Photo of Frank McAveety Frank McAveety Labour

Will the cabinet secretary compliment me on my ensuring that there was a council tax freeze in the following year?

Photo of John Swinney John Swinney Scottish National Party

I am delighted to welcome Glasgow City Council's council tax freeze, and I was delighted to propose such a freeze in this year's budget. I am only sorry that Mr McAveety could not bring himself to vote for a reforming budget, which froze the council tax and delivered to householders in every part of Scotland the support that he had delivered to the people of Glasgow in such a pioneering fashion.

I make two points that I think get to the nub of the debate. Brian Adam delivered a devastating critique of the Conservatives' proposition. He described how the Conservatives are calling for an enabling bill that would allow ministers to bring forward regulations that would make changes to local government finance. That is not how we should make such changes. The Conservatives have made no suggestions about how to resolve issues to do with the choice between the different propositions that are mentioned in the motion.

The most startling revelation in the debate came in Mr Brownlee's response to my colleague Mr FitzPatrick, on revaluation. The cat is out of the bag. The Tories are signed up to a revaluation of the council tax, which would punish them as much as the rates revaluation in the 1980s and the poll tax in the 1990s did. That is a sure sign that the Conservatives remain out of touch with the people of Scotland on the issue.

We will make our proposals for a local income tax based on the ability to pay, and we will argue for parliamentary support for those proposals.

Photo of Gavin Brown Gavin Brown Conservative 11:32 am, 4th December 2008

The local income tax is very different from all that went before it—the unpopular rates system, the unpopular poll tax and the unpopular council tax. The big difference is that the local income tax has become unpopular before anyone has paid a penny—at least the other taxes were around for 10 or 15 years before they caused outrage. The local income tax has been discredited before it is even finalised.

Mr Swinney was away in the realms of fantasy in his closing speech. He suggested that parties that supported a local income tax did much better in 2007 than did parties that did not support such a tax. Anyone who has even a casual relationship with mathematics can see that the number of members elected in 2007 who supported a local income tax was exactly the same as the number of members elected who did not support such a tax.

The most interesting revelation in the debate has been the unhappy dance between the SNP and the Liberal Democrats. The relationship is so unhappy that SNP members have not said whether they will support the amendment in Mr Purvis's name. It is telling that when Mr Brian Adam, who apparently launched a "devastating critique"—if members blinked they would have missed it—said that he is happy to work with the Liberal Democrats, he added, "who knows what will happen" in tonight's vote. I suspect that there will be 15 votes in favour of Mr Purvis's amendment.

Among some other interesting revelations, the main one involved the question of who will blink first on the local income tax. Will the tax be national, as suggested in the consultation exercise, or will it be otherwise? The Liberal Democrats have said that there is no way that they will agree to a nationally set local income tax. Will Mr Purvis capitulate or will John Swinney give up, desperate to secure the votes of the Liberal Democrats so that this discredited tax can be implemented? Only time will tell, but it is clear that one party or the other will have to give enormous ground and will receive a real red face.

Photo of Keith Brown Keith Brown Scottish National Party

In light of the demand for clarity and detail, will Mr Brown confirm whether his party will support the retention of the £400 million in council tax benefits money if the change goes ahead? Further, will he tell us when the revaluation that the Conservatives now support will happen?

Photo of Gavin Brown Gavin Brown Conservative

The Conservatives have been extremely clear about the benefits money: we are happy for that matter to be discussed and negotiated. We have not ruled out the retention of the £480 million or so. That position has been clear for months.

In the previous debate on this matter, Keith Brown agreed that it was important that the Government publish in detail the allocation method for the local income tax and, more important, state how it would affect each and every local authority. A few months ago, the Parliament resolved that that ought to happen. Although, in that debate, the cabinet secretary said that the Government had that information already, we have seen no sign of it.

Photo of Gavin Brown Gavin Brown Conservative

I will happily give way, if the cabinet secretary can explain that.

Photo of John Swinney John Swinney Scottish National Party

We will entirely honour the commitment that we gave with regard to the motion in the previous debate, which set out the position that Mr Brownlee held before he flip-flopped on the matter and adopted the position that he outlined in today's debate.

Will Mr Brown clarify two points in relation to the other Mr Brown's intervention? First, why do the Conservatives not support the council tax benefits position that the Government put forward in this debate; and, secondly, when will the revaluation that is being endorsed as part of the reformed council tax proposition take place?

Photo of Gavin Brown Gavin Brown Conservative

Mr Swinney is being utterly disingenuous and is taking Mr Brownlee's comments absolutely out of context. Mr Brownlee said that the revaluation in Wales ended up with a 5 per cent increase, but that it was possible to have a revaluation that was revenue neutral. He did not support the prospect of a revaluation; he simply put forward, in a theoretical context, how it would happen.

Joe FitzPatrick tried to advance the view that the consultation was heavily in favour of the local income tax. However, the best quotation that the SNP could find to support that view was from a group called Scottish Action Against Council Tax that—would you believe it?—said in the consultation that they were against the idea of continuing the council tax.

Let us examine the information that we have had since the previous debate. The financial black hole has got bigger—by an additional £300 million, according to the pre-budget report. We now know that only two councils supported the consultation, which says great things about the historic concordat—those two words usually get a round of applause from SNP back benchers, but not today, it seems.

We have learned that 59 per cent of people are not prepared to pay more than 3p in the pound, which means that there is a deep division between the SNP and the Liberal Democrats. On that basis, Mr Brownlee lodged a reasonable motion, which was drafted extremely widely and kept open all the options, including options that we do not support. We put forward the idea of having a reformed council tax, and there have already been two proposals in that regard: one featured £150 being given back to every family in Scotland and the other featured a 50 per cent discount for pensioners. We said that we would listen to ideas about a land value tax. Some time ago, the Parliament resolved to consider that proposal, and I think that it is right that that should happen. Our motion even allows for discussion of both the SNP strain and the Liberal Democrat strain of local income tax. However, local income tax is discredited and unpopular; accordingly, I urge everyone to support the motion in the name of Derek Brownlee.