 Welcome to the 20th meeting in 2015 of the Finance Committee of the Scottish Parliament. I will please remind everyone present to turn off any mobile phones or rather electronic devices. Our first piece of business today is to decide whether to item foreign private. Are members agreed? Members have indicated their agreement. Our next piece of business is to take evidence from the Cabinet Secretary for Finance, Constitution and Economy in relation to our Scotland's fiscal framework report. Mr Swinney is today joined by Government officials Sean Neill and Gerald Burn. Members have copies of the Government's response to report. I would like to welcome our witnesses to the meeting and invite Mr Swinney to make an opening statement. Thank you, convener. I welcome the opportunity to meet with the Finance Committee this morning to provide further evidence on your inquiry in response to your report on Scotland's fiscal framework. I welcome the publication on the 29 June of the Finance Committee's views and recommendations on an updated fiscal framework for Scotland. The written submissions, workshop and oral sessions all underline the importance of a sound fiscal framework for Scotland's future. As I said in my response to the committee, I thank all those who contributed to the inquiry. This has helped to shape how we approach the programme of work around the fiscal framework. I continue to be clear that effective parliamentary scrutiny of the framework is important and I recognise that the Scottish Parliament will want to be assured that a robust and coherent fiscal framework is in place before it gives legislative consent to the Scotland Bill. The fiscal framework needs to be fair and it needs to be workable. It is important that both Governments and Parliaments have a detailed and shared understanding of how the various elements of the fiscal framework should work and what the clear implications may be. There must be transparency and openness, and I strongly believe that there is a need for accountability in parliamentary scrutiny. Moving forward, the structures and working relations between the Scottish and United Kingdom Governments need to be reformed and made more effective. We need to look at how we work together to reach agreement, as well as how we work together to ensure the successful, on-going operation of the new funding arrangements. The Joint Exchequer Committee met on 7 July and will meet again this Friday to progress our negotiations. It is likely that, as with the first meeting, we will issue a communicator on the topics of discussion, and I will ensure that it is passed to the committee as soon as it is practicable to enable it to be kept updated on our discussions. As I am sure that the committee will appreciate, it will be a challenge to provide detailed updates as the negotiations progress, but I am happy to report back to Parliament at the appropriate opportunity on the issues that are discussed. I thank you very much for that opening statement. You have been here on many occasions, so, as you know, I will start off with some opening questions and then I will open out the session to colleagues. Your response to our report goes through section by section, so my intention is to touch on each of those areas, and I am sure that colleagues will want to explore some of those issues in depth. The first area that I want to touch on is on page 3 of your response. You talk about funding for welfare expenditure transferred into the block grant, and you say that that should reflect the full costs of the benefit devolved with an agreed methodology, and transfers into the block grant should reflect the full cost of administering the new powers. Just for clarification, would that full cost of administering new powers include the cost of setting up a new system, or is that something that you believe should fall in the Scottish Government? We believe that, where we are securing new responsibilities, there should be sufficient financial provision to enable the Scottish Government to set up and to establish the operation of the welfare provisions. The second last bullet point in that page is that we should be able to talk to the time and quantum of our capital spending materially through capital borrowing powers, and you obviously talk about borrowing further on, but that is a wee bit coy. Can you please expand just a little bit on that particular issue? The Government believes that the Smith commission was crystal clear in its report that, on borrowing, we had to be able to secure additional borrowing capability of two types. The first was additional borrowing capability to support revenue expenditure, where, if we are responsible for the raising of a larger proportion of our public finances through taxation, we have to acknowledge that there is the likelihood of greater volatility in that compared to the delivery of a set block grant from the UK Government. Therefore, revenue borrowing needs to be expanded to enable us to manage any of that volatility. The other aspect of the borrowing requirement is in relation to capital expenditure, where we believe—and the Smith commission came to that conclusion—that there was a necessity for there to be additional borrowing capacity beyond the existing capital provisions and existing borrowing provisions that would be in place as a consequence of the Scotland Act 2012 and the existing arrangements. I stress that the key point that I would stress in all of this, convener, is the importance of recognising that both of those provisions were additional to the existing arrangements that we have in place, and that was clearly articulated in the Smith commission report. Okay, thank you for that. Under the borrowing section on page 4, the last paragraph before the cut spending paragraph, I quote the Scottish Government welcomes the Smith recommendation that both Governments should consider the merits of a prudential borrowing regime. I am sure that you do indeed favour that, but it is not really a ringing endorsement saying that you should consider its merits. Does the Scottish Government in fact want to have prudential borrowing powers? I think that prudential borrowing powers would be desirable, convener, but we have to ensure that prudential borrowing powers enable us to pass the test of securing additional borrowing capability and the ability to undertake additional capital expenditure beyond the current provisions of our arrangements. For example, an argument could be advanced, which tried to suggest that prudential borrowing powers should be the only type of borrowing capacity or the only form of support for capital expenditure that we had. I would need to be satisfied in all of that. What that delivered for us was additional capital spending capability beyond the current arrangements that we have, and I am sure that Parliament would want to have that as well. The test for me is whether or not any of the borrowing arrangements that we have genuinely deliver additional capability beyond the capability that we currently have to invest in capital spending priorities. The reason why this is important, convener, is self-evident from the latest data that the chief economist has provided in the state of the economy report last week past Friday, which made the point that the construction sector in Scotland had grown by 21 per cent in the last 12 months, fuelled by Government capital expenditure, and that had flowed through also into the performance of the Scottish economy in terms of its growth. What we are able to do on the scale and the nature of our capital expenditure is so important to the delivery of the growth agenda in which the Government is focused. You are basically saying that you are looking for prudential borrowing over and above capital and departmental expenditure limits. In terms of current revenue, you say in the third-last paragraph on page 5, what the Scottish Government is seeking is sufficient revenue borrowing powers to be able to manage Scottish specific risks arising from devolved powers in the context of all the UK fiscal framework. Have you touched on that? I wonder if you can give us a bit more detail as to what you are looking for there. One of the questions that the committee asked me when I was here before, as part of the evidence gathering around the fiscal framework inquiry, was whether I thought that we should have limitless borrowing capability. I answered the committee at that stage saying that I had to acknowledge the constitutional structures within which we were operating. As a consequence, I had to accept that there would be limitations on the amount of borrowing that we could undertake. We could take a set of decisions that were perfectly supportable within a prudential framework from our perspective, but they might relate to the wider borrowing requirement and the borrowing profile of the United Kingdom. Our borrowing will be a subset of that overall United Kingdom figure. In the current constitutional environment, I cannot ignore that wider constitutional framework. We argue for the creation of a greater degree of flexibility for us to be able to borrow, but I have to acknowledge that that would have to be undertaken within a particular framework that would constrain the amount of borrowing that we were able to undertake. We would be constrained essentially by two things. One, the affordability in terms of our ability to support that borrowing, which is an absolute given. I do not question that in the slightest. Secondly, any framework that would be in place to ensure the compatibility of our borrowing with the wider borrowing priorities of the United Kingdom Government. Do you have any idea what the parameters would be? That is obviously a matter for negotiation with the United Kingdom Government. That is fine. Moving on to page 7, we are looking at no detriment, of course, which we took a look of evidence on. In the fourth paragraph in your response, you say that transparency will best be served by considering a process to apply the no detriment principle, which is sustainable, repeatable, that should minimise any reliance on subjective assessments where possible. Does that mean that the Scottish Government is looking for a mechanical formula in terms of the administration of the no detriment rule? That is a difficult word. I am not sure that I could accept the word mechanical, convener. That is an issue that came up in evidence from a number of our witnesses. The point that we are trying to make is that the exercise of the no detriment principle has got to be dispassionate. Essentially, we have to ensure that when funding has been withdrawn from the Scottish bloc as a consequence of the devolution of a particular responsibility, and we are taking account of that, we do so in a fashion that is neither beneficial nor damaging to the interests of the Scottish Parliament and the Scottish Public Purse and vice versa to the United Kingdom into the bargain. I suppose that the better word is a dispassionate analysis has got to be undertaken to enable us to arrive at a robust position on the exercise of the principle of no detriment. Are you not looking for a formula to be applied to that no detriment? You are talking about the falling paragraph. The application of no detriment should be symmetric and operate in the base of a shared understanding of the evidence. Is that something that is going to be deliverable? Is it going to be a shared understanding with the UK or with the block grant adjustment where they had one position and the Scottish Government had another position and we were deadlocked for consideration? Time will give us the answer to that question, convener, but I think that the point that I would make to take the example that you just raised is that—and this gets to the heart of another point that I have made to the committee in my previous evidence—I do not think that it is good enough for us just to say that this is the OBR or the Treasury methodology for this particular block grant adjustment. We have to look for what is the best mechanism, what is the best information base that can enable us to make a judgment about the block grant adjustment. I believe that the model that we had constructed on land and buildings transaction tax, for example, which was based on housing transactions in Scotland, real data—over many years of that data being held and retained by registers of Scotland—verses a subset of a UK sample where the UK property market is heavily skewed from one extreme in London to others at the other end of the spectrum. To me, there was a very robust, well-evidenceed information base driven by actual housing transactions in Scotland that gave us the ability to come to a conclusion about what the block grant adjustment should be, not because we just fancied a different number, but because we had built an entire system on the actual housing transactions that had taken place in Scotland over a number of years. I think that what I am appealing for in this process is for the UK Government to accept that there may be a better methodology than the one that it uses. If we can get to that position, perhaps to answer the question that you just asked me, it will be deliverable, because we will come to a shared understanding based on the evidence that we have in front of us. I cannot get to a shared understanding that accepts that the best mechanism for the block grant adjustment on land and buildings transaction tax is to subdivide the UK property market, because I think that the UK property market is uneven. The model that we put forward, I thought, was a robust, evidence-based model that should give confidence to a decision making process in this respect. I would certainly agree with that, but it is worth it or not that you can achieve that, because despite all the evidence that you presented, the UK Government still was not prepared to accept the evidence that you put forward. In those areas where it might not be quite so clear the data on which you are basing your proposition, it might surely be even more difficult to get understanding and agreement from the UK Government, especially in the short time frame that you have ahead of us. We have to pursue the best-agreed data available to enable us to form a judgment. I certainly enter into those discussions in good faith, prepared to look at the data on all of those questions and to come to appropriate conclusions. Equally, I am looking to the UK Government to take the same approach to the data that we put forward. Okay, thank you. Now, moving on to page 8 in terms of the Barnett formula, you say in fourth paragraph, the transparency of the Barnett process could be improved. I'm just wondering if you can enlighten us on how that could be improved. There is a process that we go through, which looks at every spending settlement, to determine whether the Barnett formula has been correctly and fully applied in all circumstances. Some of that work is now going on in relation to the construction of the United Kingdom spending review, where many of those issues are very material, particularly in relation to the establishment of baselines and comparability factors between United Kingdom and Scottish Government budgets. We endeavour, from our perspective, to apply the greatest amount of scrutiny that we can to the funding decisions and changes that are made by the United Kingdom Government and to ensure that they have been properly calculated in the fashion that would be consistent with the Barnett formula. I think that where the position could be improved is that the UK Government could share more of the thinking and the workings that underpin some of the comparability factors and they could also share more of the thinking and the workings around particular programme changes to enable us to come to an even better and more informed position about whether or not the Barnett formula has been properly applied. However, those are essentially steps that the UK Government has to take as the essential administrators of the Barnett formula and the administrators of the spending decisions that then have an effect through the Barnett formula on public finances within Scotland. Last week, the Committee on Informal Session met the Scottish Fiscal Commission. One of the issues that the committee pointed out in our report was that the committee is unaware of any other examples of fiscal councillor lying solely on official government forecasts. In the last paragraph on page 8, you talked about the 17 IFIs in operation in OECD countries in 2013, only two in a row, in producing macroeconomic forecasts. Surely the issue is not whether or not the SFC necessarily produces such forecasts, but there is a body other than the Scottish Government that does that? That is where I take a different opinion from the committee in the report that the committee produced in that respect. I think that the key test here is the fiscal commission able to challenge the estimated tax revenues that are put forward by the Government, and are they able to pursue alternatives to those tax numbers. In my opinion, I certainly want to make sure that the fiscal commission is enabled and empowered to do exactly that. I believe that the bill that we have put forward and the arguments that we have put forward enables that to happen in a number of different respects. First of all, on the independence of the fiscal commission, the appointment mechanism of the members of the fiscal commission was designed—I rehearsed this with the committee extensively before appointment—to ensure that none of the individuals would be in any way constrained in saying what they liked about the Government's predictions. Nobody was ever going to have to come to me for reappointments, so there was no question that I held some sway over the individuals involved. They were appointed because of their eminent expertise, and that point was well recorded and generously recorded by all shades of parliamentary opinion about the expertise of the members of the fiscal commission. The commission was appointed on the basis to be independent. Then we move on to the questioning and scrutiny of the approach that the Government takes. Essentially, on what we have done so far and the experience that we have had to date, the fiscal commission has been in a position to scrutinise the working model that generates the tax revenues that the Government would aim to establish, to test it, to challenge it, to interact with it, to push it, to try to change it and ultimately to get to a point where the fiscal commission was confident from its independent standpoint that the model for tax forecasting was robust. As I have said to the committee before, if the fiscal commission was to say to me, I think that your model is flawed, I would have to go back to the drawing board. There is absolutely no way that I could come to Parliament and say that I am ignoring this, because the independent fiscal commission said, if this is flawed, I would have to change it. The fiscal commission has a veto over all of our tax modelling arrangements. The commission has all of the power that it could ever require to challenge those forecasts. Finally, we come to the question of resources. Again, I want to make sure that the fiscal commission has the resources that it requires—not that I believe that it requires, but that it believes that it requires—to undertake that task. My officials are in regular dialogue with the fiscal commission on the questions, and I want to give the committee the assurance that the fiscal commission will support and deliver to the fiscal commission the resources that they require to enable them to fulfil their functions. In paragraph 4 on page 9, a thorough assessment of the methodologies and assumptions that were applied to produce the SFC forecasts. In scrutinising the economic determinants of the forecast of NDRI underpinning the 2015-16 budget, the commission expressed that the buoyancy assumption seemed optimistic and that the commission therefore affected the veto of our tax forecasts. You have just responded in that fashion as well. When we met the fiscal commission last week, it seemed that the commission was advising officials directly. Does that not compromise its scrutiny function? You have said, for example, on page 10 in your report in paragraph 5, that those bodies should be independent of Government and seem to be so, but if members of the Scottish Fiscal Commission are coming in and meeting officials prior to production of forecasts, etc., and advising them along the way, does that not compromise that position? I think that that is essentially the commission fulfilling the role that we would expect them to fulfil. I cannot see how the fiscal commission can fulfil its role without interacting with the Government to ensure that what the Government does is compatible with what the fiscal commission expects. That is precisely the nature of the arrangements that the fiscal commission is in a position to say to Government that we do not think that the arrangements that you are taking forward are robust enough or sufficient evidence-based or whatever view they happen to form. If our assumptions are that they believe that they are optimistic or that they are under-optimistic, the commission has got to be able to express that to Government and we have got to respond to that. Ultimately, if we do not, then when it comes to the final stage, I run the risk of the commission saying to me that we do not think that your numbers are robust, which is a disaster. If you look at the example that you cited, convener, the fiscal commission said that they thought that the buoyancy assumption was optimistic and I revised down the buoyancy assumption in the forecast that I put to Parliament as part of the draft budget. The fiscal commission is just a pre-o-facy example of the fiscal commission being able to cast doubt on an assumption that I had made and I had to respond to that. Absolutely, I understand that, but it seems now that rather than you producing forecasts and then the SFC looking at them, they are actually helping to… They are actually inside, if you like, saying that you should do this, you should do that within the system, so to speak. I do think that there is concern that people may look at that and wonder if that does impact on the independent scrutiny function, if they are involved in almost a council of economic advisers day-to-day workings of the Scottish Government itself. The fiscal commission has got to be able to exercise influence over how the Government undertakes its activities, so that we can get to a position whereby we have robust modelling and robust forecasting. Without that, I cannot quite see how the fiscal commission can exercise its responsibilities. It has the absolute ability to say to us formally that we have not got the forecast correct and to challenge the forecast. It has also got the ability to express that view at various stages and at various times to ensure that we are focusing on the right judgments to arrive at the calculation of the forecasts that are implicit in those arrangements. I do not think that those things can happen in silos. If it happens in silos, we end up with a poor understanding of what is underpinning the methodology. Why does the draft bill not state that the SFC should endorse the forecast rather than just assess the reasonableness? Ultimately, the forecasts are the Government's forecasts and I am accountable to the Parliament for those forecasts. If the SFC was to endorse them, that would soften the accountability that I have to Parliament for those forecasts. Ultimately, they are my forecasts and my calculations. The calculations that I believe are justifiable to put to Parliament. The fiscal commission is there to assess whether I have done that exercise judiciously, or whether I need to give further consideration to those questions. I move on to intergovernment relations. I will conclude in a few minutes to let my colleagues in. In the middle of page 12, the framework will be agreed jointly by both Governments, and we are aiming to conclude negotiations by the autumn in line with the timetable for the Scotland bill. I make clear that a robust and credible fiscal framework will need to be agreed before recommending to the Scottish Parliament that legislative consent is given to the Scotland bill. If a robust and credible fiscal framework is not agreed, would the Scottish Government consider not supporting the Scotland bill? That is implicit in what I have said to the committee. I certainly said to the Further Powers Committee as far back as the 12th of March. There has to be a fiscal framework in place that is acceptable to Parliament before any LCM can be agreed to. It is in no way possible or plausible for an LCM to be agreed without an agreed fiscal framework that is to the satisfaction of Parliament being in place. I do not think that it could be any clearer than that. Before the Government would put a legislative consent motion to Parliament, there has to be an acceptable fiscal framework in place. You are going to say that ministers in agreement that negotiations on the fiscal framework should be supported by information sharing principles, which ensure that both Governments have access to the same information, subject to legal requirements and good time to support the decision making process. Where are we with this? We are making progress on it, convener. If I go back through the sequence of events and my officials can correct me if I am not recalling this correctly, we essentially started the discussions on the fiscal framework back in March when I met the chancellor. That was just at the start of the United Kingdom general election campaign, so we acknowledged that ministerial interaction would be difficult for a period. That led to officials doing a lot of the preparatory work on many of the questions that you raised in your question, convener. We then, subsequent to the United Kingdom election, met with the chief secretary in June, on 15 June. We had a further discussion at the Joint Exchequer Committee on 7 July, and we had a further Joint Exchequer Committee on Friday. We then had a further session in September that was planned, one in October and one in November, with a large volume of preparatory work being undertaken in between all those meetings. On the characteristics that you talked about, convener, about availability of information, about open dialogue on all those questions, all of those things are happening. Lads have been happening at official level, but there has been an increasing amount of ministerial interaction, and there will be further amounts of ministerial interaction in the course of the next few weeks, as I have just set out to you. I have one further question, which is in response to our conclusion, which is the second last paragraph, in your response. We have previously given a commitment to keep the Scottish Parliament updated on the negotiations with HM Treasury, and we are happy to continue to do so. I am just wondering what the mechanism will be for keeping Parliament updated. Will you go through the finance committee, or will you make a statement to Parliament at some point, or how do you intend to keep Parliament informed of what is happening here? That is quite a difficult issue, convener, because I want to be open with Parliament, because all shades of parliamentary opinion have to be confident about the legislative framework. I recognise that to be an absolute requirement of members of Parliament, and I want to do all that I can to support that. However, there is a negotiation going on with the United Kingdom Government on all of these questions. I just have to try to strike a balance between satisfying the needs of Parliament for there to be a transparent discussion about what is happening in the discussions with the UK Government, while I am sure that Parliament would understand that, leaving me enough space to be able to conduct a negotiation that enables me to protect the Scottish interests, which is my objective. What I have said to the committee before is that I would find it difficult to give a running commentary on all the discussions that are under way, and I would hope that Parliament would understand why that is difficult for me to do that. I am very happy to update Parliament through either parliamentary questions or an appearance at the finance committee, or whatever mechanism Parliament believes to be appropriate, but I just insert the caveat that, although that understandable and necessary requirement for parliamentary scrutiny is being undertaken, I also have a negotiation to pursue with the United Kingdom Government. Thank you very much for that. I am now going to open up the session to colleagues around the table. The first person to ask questions will be Gavin to be followed by Mark. Good morning, cabinet secretary. Just a quick follow-up on that last question, then, and I appreciate that there is a negotiation going on and you do not want to give a running commentary. Everyone understands that. However, if there are points agreed on Friday, when I think you said the next meeting is, between the Governments, is it your intention to publish agreements that have been reached so that we can see where there is no discussion going on now that you have decided what the position is, and then what is still on the table, or is it the intention to save all agreements until the end of the final package? The view that I am taking on this is that nothing is agreed until everything is agreed. We may make progress and there was a communique that was published after the meeting in July. I would expect that there will be a communique of some sorts published after the meeting on Friday. However, my view is that it is very much in the realms of the process of making progress through those questions, but ultimately we will have to look at the whole thing to say, do we believe that this is a satisfactory arrangement? I think that, in trying to be as open about this as possible, I realise how difficult that is then for Parliament, because I cannot come here and be scrutinised, for example, in October, about where we have got so far and how many points have you got agreed on. I quite appreciate that it is then difficult for it to be pursued with Parliament. We heard yesterday from the First Minister that consent to the bill would not be given unless the fiscal framework was, in her words, fair, and he reiterated that again today. In terms of transparency and trying to work out what you think is fair, is fairness what is contained within your response to the committee? If I look at all the issues that you raised in your response to the committee and you set out the Government's position, is that broadly what you deem to be fair, or are there other issues that have not appeared yet? I am just trying to get a sense of exactly what you mean by fairness. Have you covered them all publicly already, or are there not hidden bits, but bits that you have not covered in there? I would have to go away and look once again at the full response that we have given to the committee to give a definitive answer to that point. There will be a range of issues about which I am concerned, some of which will be to ensure that I cannot, for example, recall if, in my response to the committee, I have covered all the considerations that emerged out of the Smith commission report that I think have to be involved in the fiscal framework and have to be protected in the fiscal framework. I would have to go away and just establish, before I give a definitive answer to that point, as to whether or not that was the case. I would also have to say that, whilst I might have in my own mind the checklist of things that I think have got to be in there for it to be defined as fair, I might face a couple of other things in the course of a negotiation, but I think, wait a minute, that is not very fair. It is not in my checklist that it arises, and I have to be able to respond to that. Ultimately, I want an approach that enables the Scottish Parliament, without prejudice, to be able to exercise the powers that have been granted to us on the fair and reasonable basis that I believe was argued for in the Smith commission report. Okay, thank you. If I turn to the specifics of your response in the committee's conclusion paragraph 25, we say that the committee recommends that there should be a legislative requirement for the Scottish Government to prepare a charter for budget responsibility, containing details of the Scottish fiscal policies and how they will be implemented for approval by the Scottish Parliament. Your opening response to that says that we welcome the committee's recommendations at paragraphs 22 to 25 and so on. My reading of that is that you accept paragraph 25 in its entirety and that there ought to be a legislative requirement, but it is not addressed anywhere else in that answer, so I just want, for the sake of clarity, can we assume that you agree with paragraph 25 in its entirety from your opening sentence there? What I have said in the opening sentence is that we welcome the committee's recommendations and that we believe that there should be a well-designed fiscal framework in place. As to the specific choices about whether or not what fiscal arrangements the Government decides to put in place, there is a lot to be commended about paragraph 25 and the Government would give consideration to whether that was approach that it wished to take in the aftermath of the agreement of a fiscal framework. I have left the door open to paragraph 25. If we go on to borrowing powers, you gave quite a detailed answer to the convener, so I do not want to dwell on it for too long, but you have not given a categorical view on what you think the limits are, what the sort of quantum might be for revenue or for volatility or indeed for capital. Maybe you do not have a definitive view at this stage, but I am interested to know just how is the Scottish Government going to form a definitive view on what the borrowing powers ought to be A for volatility or revenue and B for capital? We will form a definitive view on that by essentially testing the question of adequacy, adequacy to deal with the level of volatility that we can foresee within the tax revenues over which we have control and adequacy in relation to fulfilling the Smith test that we had to have additional borrowing capability that enhanced our capital expenditure beyond its current arrangements. The test of adequacy is the one that I would apply, but I would also accept that there are constraints to that given the fact that we are undertaking this conversation and discussion within the United Kingdom fiscal framework and the United Kingdom fiscal environment. Of course, the importance of all that enables us to take a set of decisions arising out of the negotiations around the fiscal framework that should enable us to exercise a greater degree of fiscal flexibility than we have today. I move on to the Scottish Fiscal Commission, which has answered a number of questions on that already. You said in your response that you drew some of your conclusions about the forecast issue, which is the main issue of contention. You drew some of your conclusions from the responses to the Government consultation on the draft bill. Where a majority of those responses are basically supporting your position and saying that they did not agree with the committee or vice versa. Can you give us a rough flavour of what the tenor of the responses happened to be? I am not sure that it was clear numerically from the responses that have come in, but we will publish a full response to the consultation information that came out in due course. In fulfilling our obligations there, we will be able to answer the point that Mr Brown has raised. I have a very good question about looking at international bodies and so on. You made the point that seven of the 17 assessed Government forecasts as opposed to producing their own forecasts. Out of those seven, some of them I know as a matter of fact, for example Sweden, have alternative forecasts to examine, so they do not just look at the Government forecasts, they look at a range of forecasts. I do not know about the rest of the seven, but can you give any examples of Fiscal Commission-type bodies who only look at the Government forecasts and that is the only forecast that they can use when reaching their decision? The model that is perhaps closest to what Mr Brown has said is the Irish Fiscal Advisory Council, which assesses Government forecasts. They only have access to Government forecasts? That is my understanding. That is my understanding. Okay. Are there any others who only have access to an official Government forecast? There is one that I can readily give to Mr Brown, but for example out of 15 institutions, seven assessed Government forecasts, six prepared alternative forecasts and two had no role in relation to forecasting, so there must be a variety of others and we will happily provide those to them. I am not trying to explain, but my question is, because if they are assessing Government forecasts but are able to assess other forecasts as well and reach a view over a blend of forecasts, that is different from a body that only has access to one official forecast and there is no alternative? I think that this is where we are splitting hairs with respect, because I think that what I have tried to say to the committee, I have obviously not got this across clearly enough, is that if the Fiscal Commission does not agree with my forecast, I have got to change my forecast. That is, to me, utterly and blindingly obvious. If the Fiscal Commission does not accept my forecast, I have to change it. The Fiscal Commission said, and you could say that that was almost fairly soft-wording, that my buoyancy assumption on a non-domestic rate seemed, to quote them exactly, seems optimistic. You could argue with that, well, maybe it is, maybe it is not, we will just call Canny. I suspect that I could have marshaled an argument when you said, well, they only say it seems optimistic, they do not say it is optimistic, so I have got room for a manoeuvre. I changed it at the first hurdle. I cite that to the committee to make the point that if the Fiscal Commission judges the stance that I am taking not to be reasonable, I have got to go back to the drawing board. I have got to agree to disagree on the fact that we are splitting hairs, I actually do not think that we are splitting hairs at all here. They can cast out on your assumptions, cabinet secretary, and they did and you amended, but you said earlier, and I quote verbatim as long as I have written it down correctly, the important thing is that they are able to pursue alternatives to that number. On the reports that I have seen from the Fiscal Commission, they have not been able to come up with alternative numbers. They have been able to say, we think that you are a bit optimistic, or they have been able to say, that seems reasonable, but they do not appear to be able to look at a range of models or a range of alternatives and they have not come up with any alternative numbers, which you said was the key. If the Fiscal Commission wished to do that, the Fiscal Commission have to be satisfied that the approach that the Government is taking is going to deliver a reasonable forecast. The Fiscal Commission is able to interact with the Government's model of estimating and forecasting revenues and they can question it, they can dissect it, they can challenge it, they can interact with it, and we have to satisfy them that we have addressed their issues. Therefore, if we do not satisfy them, we will get a report that says that we are not satisfied that this is a robust model, and if I get a report that says that this is not a robust model, I have a problem in my hands. I must satisfy the Fiscal Commission that every judgment we have made about the constructs of that model gives the best possible reliable forecast that you can conceive of in these circumstances. Once we have an agreed model, I then have to make a judgment about the rates and the Fiscal Commission needs to consider those rates in relation to the model that I have put together. If we cannot satisfy the Fiscal Commission about the robustness of the model, then we have a significant difficulty in our hands. Last question, then. Your conclusion is that you are not persuaded that they should do official forecasts. Can they do alternative forecasts? The Fiscal Commission is an independent body. They are free to produce the material that they wish to produce, and I am not a decision maker about the Fiscal Commission. In terms of our remit, we are not allowed to do alternative forecasts. As far as you are concerned, I guess that it will come down to what the bill says. The Fiscal Commission is an independent body. I do not run it, so I cannot dictate its agenda. There will be nothing in the legislation that you put anyway that will prevent them from doing alternative forecasts. There is nothing that I can do to constrain the independence of the Fiscal Commission. I want to go a little further around the intergovernmental relations point, because, as well as sitting on this committee, I also sit on the Further Powers Committee, which has been exploring the question around intergovernmental relations. In terms of the current framework of IGR, the view has been, and I think that you have accepted it, that there needs to be some tying up and formalisation around the way that Governments interact. Do you have a preferred model in terms of how ministers and departments interact, or is that something that is very much on the negotiating table at present? We are going through what I would recognise as a more orderly process of discussion on the arrangements around the fiscal framework. There is a very clear structure for those discussions to take place within and a very clear agreement of the issues that we are discussing. That is beneficial. I think that a lot of what this issue turns on is some of the material that I discussed in my response to the convener earlier on, which was about the degree to which there is appropriate respect demonstrated for the mechanisms and approaches that we might advance for calculating certain aspects of the negotiations on fiscal frameworks. For example, if we come up with a model, which is a robust model for the determination of the priorities that should be in the fiscal framework, I think that that should be taken seriously. Of course, we will get the answer to that in the course of the proceedings in which we are involved. One of my criticisms of the intergovernmental mechanisms is that they have been rigid and scripted and not particularly relevant. I hope that we can improve that in the wider intergovernmental working. I should also say that the formal mechanisms of intergovernmental working in my experience over the past eight years have not been particularly valuable, but there is a lot of good bilateral intergovernmental working that goes on in sorting out particular issues and policy questions, which I think is beneficial to us all. I guess that the question that follows on from what Gavin Brown was mentioning is about how Parliament has kept updated on the appropriate points at which Parliament has kept updated. You have suggested that a running commentary is not something that would be helpful to committees or to the negotiation process, but should there be some formalisation around the points at which Parliament has updated or committees have updated or should it be very much on a kind of judgment column when the right time for that to be done would be? It is a very difficult question for me to answer. I hope that I have conveyed to the committee my interest in being open, but I hope that the committee can understand the constraints under which I am operating. Given the answer that I gave to Mr Brown a moment ago, that nothing is agreed until everything agreed, I think that it would be difficult for me to come to Parliament with a sort of take of issues agreed by, let's say, 1 October or 1 November, whereas I certainly can come to the committee and give a sense of how much progress has been made in general around those questions, but we would have to look at the value that would be attached to that. The indications that have been given to the committee around the timescale that the UK Government is looking at and the Scottish Government in terms of when the fiscal framework is likely to be agreed was also accounting for the flexibility that autumn now takes on when it comes to the parliamentary timetable. Obviously, there is the Scotland Bill process, and the view that has been expressed is that it would be unlikely that that would be put forward for final approval until the fiscal framework was in place. Is that your understanding that you could not conceive of a scenario in which it is completing its parliamentary process at Westminster before there is a final agreement on the fiscal framework? I hope that I have been crystal clear. The First Minister was crystal clear yesterday in Parliament about this question. We could not bring forward a legislative consent motion in the Scottish Parliament until such time as we have an acceptable fiscal framework in place. On the question about borrowing powers, you have said that there is the wider UK borrowing framework to examine before we can determine what the Scottish borrowing limit is perhaps the wrong word, but how much Scottish borrowing can be carried within that. Has there been much discussion around what that is likely to look like or is that something that is going to need to wait for the spending review to take place before there could be greater clarity around that? We will begin to start talking about some of those questions on Friday, and I think that they will also be material to the spending review. Certainly, the perspective that the Treasury ministers have shared with me is that they would like to have the fiscal framework agreed in much the same timescale as the spending review, so that those issues can be looked at collectively. That is what we are aiming to do. John Finch-Earley, on our report at paragraph 23, we quoted the command paper talking about committees concerned about the level of constraint that is implied by paragraph 2.27 of the command paper, which states that the fiscal framework must require Scotland to contribute proportionally to fiscal consolidation at the pace that is set out by the UK Government across devolved and reserved areas. The tone of that says to me that this is effectively a dictat that the UK Government will decide, and that concerns myself and the committee. Is that your concern as well? I do not support those words. They are not my words and they do not represent my position. I think that the whole point of devolution, the fiscal commission, the Smith commission and all the debate that has gone on here has been about giving this Parliament greater flexibility to take alternative sets of decisions. I accept and I have been pretty clear about this, that there will be a relationship between the fiscal decisions that take place within Scotland and the UK's fiscal framework. I accept that we are living within a United Kingdom. There will be certain constraints of the fiscal architecture, but the wording in that quote that the committee highlights at paragraph 23 of its report has a tone about it, which essentially I read to say that it is our way or it is the highway, and I do not think that that is acceptable. I was interested in your comment about VAT, which is the second-last paragraph. Assignment of VAT provides no devolved control of this tax, but it is effectively an alternative approach to calculating part of the Scottish block grant. I tend to agree with that because we have no control over VAT, so the value in getting VAT assigned is not very great. There is certainly no decision-making enhancement as a consequence of it, none whatsoever. It is simply a mechanistic calculation to essentially put a greater degree of tax revenue under the control of the Scottish Parliament, but we have no decision-making capability over VAT. There is one aspect of it where we may see the consequence of our policy actions materialising in the level of VAT that is collected in Scotland, but I would have to highlight that that is likely to be a more peripheral factor than a central factor. The way VAT would be assigned, whether it is at the end point or all the way through the process, is still to be decided. There is work under way that looks at all of those different methodologies and how that might be calculated. That is also one of the issues that will be discussed and afraid. For clarity, the convener asked you, and I think that it has been touched on by others, about the amount of borrowing and prudential borrowing. From your earlier answer, you seem to suggest that we would have to be able to borrow more or at least spend more on capital than we are at the moment. Prudential borrowing, as I understand it, means what you can afford to sensibly borrow and therefore pay back. Presumably, we would never want to go above what is prudential to borrow. I hope that that would allow more borrowing than we have at the moment. For example, if I give the committee a very real example of that, we have taken a set of decisions around the revenue-financed capital programme, which is essentially generating about £1 billion more capital expenditure in this financial year than would be possible had we just stuck to our traditional methods of spending capital funds. We are spending about £1 billion more on capital because we are going to finance that by revenue-financed investment, which is, I would argue, a form of prudential borrowing, because I have put in place a framework that says that there will be a limit set by how much our revenue-financed payments can reach to support capital expenditure, which is essentially a prudential framework. If we cannot go beyond that limit, I have put that limit in place some years ago. I report on it to Parliament at every budget process and I am happy to report on it more frequently, but that is a framework. I say that there is a certain amount of our revenue that we can count on to support revenue-financed investment, but there is a limit to that. Once we reach that limit, we have to stop doing that, but what it does is increase our capital capability. That limit that I agree with is set on by you and it is voluntary. Does it need to be fixed more in stone somewhere? There is an argument for that, yes. Again, I am operating on the basis that having said that there is a 5 per cent cap on this, I think that I would find it hard to come to Parliament and say that there should be six or seven or eight. Having made the argument for five, I think that I would be on pretty thin ice. One day you might not be there and a less responsible person might take over. We should never speculate on such terrible adversities to afflict Scotland, but I think that some of that comes back to the point that Mr Brown raised about paragraph 25 in the committee's report about the wider fiscal rules that might be in place as a consequence of all those discussions. That would be a reasonable point to consider. Paragraph 63 refers to borrowing and the whole concept of borrowing for preventative spending. I think that that came up from ICAS, which I declare that I am a member of. Is that part of the whole borrowing picture that we have already discussed, or would that be a separate concept that you could borrow specifically for preventative spending? I think that we would have to be very careful about that. I take the view that I am very hostile to borrowing for revenue expenditure. I can accept the argument and I make the argument for having the ability to undertake revenue borrowing to deal with tax volatility, but it is quite a different matter to borrow to support day-to-day expenditure. That is a matter of principle, which is how I read that recommendation. There is an argument to borrow for capital investment that may well have the impact on preventative policies. I can accept the argument that if we borrowed for capital investment in greater cycling infrastructure or if we borrowed for investment purposes to redesign healthcare services to make them more integrated in localities to meet a wider range of needs, which we are all about providing preventative opportunities for people to interact with public services to address some of the issues. I could accept that argument. However, the way that I read that paragraph suggests that we should be borrowing for operational expenditure other than tax volatility, and I am not supportive of that. The whole area that we have already touched on, but I will touch on it again about the relationship between the Governments and some of the discussions and some of the things that have been said. I was interested in page 7 at the last paragraph of your response before 111 in the middle of the page. We will continue to work within the spirit of Smith to ensure that consensus is reached between the Scottish and UK Governments and to ensure that the application of no detriment is symmetric. We touched on tone right at the beginning of my questions. There are a few other things. If we go on to pages 11 and 12, there is the whole concept of me not having an independent body to sort out page 12 and establish an independent body to advise, for example on the calculation of the block grant, independent arbiter to resolve disputes on issues. I am sorry for jumping around, but on page 8, at the most recent meeting of the George Eichscherch committee, both Governments agreed to look in detail at the range of options. I have to say that all of that putting it together does not fill me with optimism. If we are only now saying that the Governments are agreeing to look in detail at the range of options, everything that I pick up from Westminster is that they are the judge and the jury. They will make all the decisions. They will not accept an independent arbiter. Is that your reading of it all as well? We will see what happens in the course of the discussions. I can understand why Mr Mason might come to that conclusion. I already understand that, but the Smith commission has set out that there has to be a fair fiscal framework in place and the UK Government has agreed to implement the conclusions of the Smith commission report in full in its entirety. I think that some of those judgments are implicit as part of that process. We will wait and see what happens. Finally, I want to touch on the Scottish Fiscal Commission, not surprisingly, which we have struggled over for quite a long time. There have been various suggestions made to us as a committee. One has been that you could have a body that was making its own forecasts, but it was very cosy with the Government, so it would not really be independent. On the other hand, you can have somebody who is totally independent but who is not making their own forecasts. It is that question of independence, which is more important than who makes the forecasts. Is that a view that you agree with? Yes. The Fiscal Commission has been set up on an independent basis and I have no control over it. I believe that it was important that we had to appoint people of very strong professional, reputational capability and people of high integrity. Amongst all the whole process that we went through about the appointments, all of that was accepted right across the political spectrum within Parliament. We have a Fiscal Commission, which is independent. I cannot direct it. It has people of great capability and integrity in its members and it has, as I have demonstrated already, practically already. It is not even in statute yet and it has exercised a veto over my forecasts. I think that that should give people confidence that we have a body that fulfills the key tests of being able to exercise independent judgment. If the commission did prepare its own forecasts, would we then need a separate body to assess those forecasts? I would have to make a forecast as well, because I cannot just sit around waiting for a forecast to come along. I have got to be doing some work on that, so I would be setting up a forecast. The Fiscal Commission would be making up a forecast. There might be a call for what if I thought that the Fiscal Commission forecast had some flaw in its methodology? Where do you stop? In that scenario, it would not just be that some Government resources have effectively switched over to the Fiscal Commission to do the forecasting, but we would actually need duplication then. Of course, I would have to be able to undertake forecasting work to determine what is undertaken. Edward Troupe came to the committee and essentially set out to you that HMRC does all the legwork and the activity and the data to inform the forecasts that they will be put forward. That has got to be done somewhere. We have already said that I get the impression that the commission is feeling that they are properly resourced at the moment, but that would require an increase in resources if both sides were going to be forecasting. I was surprised that you did not respond to paragraph 61 of our report, because it seems to me that the block grant adjustment, particularly in relation to income tax, is absolutely central to that. It may be that there is not much disagreement between you and the UK Government on that, but the point that we made was that some witnesses were questioning whether the whole-term method would work for us if we had a relatively smaller number of higher-tax pairs and a slower population growth. I suppose that the questions that we asked were whether you carried out any analysis of those factors and whether you carried out any analysis of the alternative of basing the indexation on the per capita tax base, rather than the overall growth of the UK tax base. We arrived at the conclusion of the benefits of the whole-term mechanism during the consideration of the Scotland Bill 2012, which is rising out of the Kalman commission. Our view was that the whole-term method was a more reliable and stable mechanism than the one proposed by the Kalman commission. We did a lot of work at that time to demonstrate the comparative experience that would have happened had we gone for the mechanism that was proposed by the Kalman commission versus the mechanism that the whole-term commission had put up. Essentially, the Kalman mechanism would have had a significantly damaging impact on the Scottish budget over the years of devolution in advance of that moment, whereas, if we applied the whole-term methodology, it was a broadly neutral experience. That was essentially what we were looking for, as I have looked for throughout the process, starting mechanisms that are broadly neutral. The issue that Mr Chisholm raises about the question of indexation is a material issue to the negotiations around the fiscal framework. Obviously, I am looking at and I would expect the joint work with the Treasury to look at the most appropriate mechanisms for indexation to address all of those questions. Can you say whether you have done any analysis of the impact of different scenarios on that? We are doing that analysis just now as part of our discussions with the United Kingdom Government. Most other areas have been covered, but I can go back to the fiscal commission briefly. You say that you have no control over the fiscal commission, but in a sense, do you not have some control over its independence? Is it not your responsibility to ensure that it is independent and to ensure that it is perceived to be independent? I suppose that is part of our worries about the way that it seems to be operating. There may well be good reasons for the commission to have meetings with your officials and to advise your officials, but it does rather change the perception of them. That is part of the reason why we are concerned about that. It could be said that they are not acting very differently from the economic advisory group. Although you can give the example of NDRI as a hard example of them challenging you, in fact, if they keep having informal meetings, most of those differences will get ironed out before there is any need to challenge anything. If we are now getting to the point where we are saying that the Scottish Fiscal Commission cannot meet officials of the Scottish Government, then I am not sure how the Scottish Fiscal Commission can exercise its responsibilities. I think that that is a truly absurd proposition, because how are the Fiscal Commission supposed to interrogate my officials about the model? How is that supposed to happen? It is an absurd argument. I come back to the key tests of the independence of the Scottish Fiscal Commission, in my view. First of all, the individuals are not able to be re-appointed. None of them can be re-appointed as part of their arrangements. I cannot hold the dagger of dismissal above the heads of the Fiscal Commission. They are in there for their term in office. Secondly, they have got to be people of strong professional reputation. We all sat through the debates that went on in committee and in the parliamentary chamber, and the one issue that was not in any way questioned by anybody from any political persuasion in Parliament was that those people were not technically and professionally competent and fit to be on the commission. I accept that there was an issue about two members being members of the commission, the council for economic advisers, and they are both no longer members of the council for economic advisers. That issue has taken care of itself. We then come on to what is their freedom of operation, and I have no ability to direct them. I am dependent on them to validate and assess the forecast that I have put forward. I have given the committee one very concrete example where we are not even in statute yet and I have had to change my forecast. I have done it readily and willingly because I respect what the commission says. If the commission is not able to interrogate my officials about what is involved, then we are on the risk that the commission might get a misapprehension about some of the things that are inherent in our work and our forecast, and that would be damaging to the quality of the work that is involved. I do not think that anyone is suggesting that the commission should not be able to interrogate your officials, but I suppose that there is a difference between you producing an estimate that they then interrogate officials about as part of their responsibility. What seems to be happening is that the commission is having a significant influence on your forecast. Again, I am not necessarily saying that that is a bad thing if we had a different model, but it is inconsistent with the model of a separation of those who are making the forecast and those who are judging its reasonableness. It appears that they are becoming high-level Government advisers, which I think that Governments of all hues have relied on to a large extent external advisers under devolution. It is not a bad thing, but it is not consistent with the model as stated. I do not accept that at all. I think that the fiscal commission must be free to choose who they speak to, what they interrogate, what they look at, and I can have no control over that process, and I do not. They have been set up independently, they are free to operate independently and it is inherent in the work that they have to undertake, that they have to properly understand and have the ability to interrogate what the Government is doing on those questions and to challenge it. Ultimately, they have got the absolute ability to say that they do not think that that is reasonable. I will say it now, but I will never come to Parliament to counter the fiscal commission. Never, because the credibility of what I am saying will not stand the test of parliamentary scrutiny. I am sure that there will be many more discussions of this during the course of the bill. Unfortunately, I will not be taking part in them, since this is my last day at the finance industry. On that tearful note, Jeane, to be followed by Richard. A couple of points, cabinet secretary. The Joint Exchequer Committee, who sits on that? The chief secretary to the treasury sits on it, and he is accompanied—I will tell the committee what I know about this, but if I get this wrong, I am sure that the UK Government will challenge it. He is accompanied by Lord Dunlop, not in his capacity as the parliamentary undersecretary of state at the Scotland office, but in his capacity as a special adviser to the treasury. I will leave that with the committee to mull over. There are various officials that support the chief secretary at the Joint Exchequer Committee, and I represent the Scottish Government at the Exchequer Committee, and I am supported by a range of officials who give me professional advice on all of these questions. In terms of senior officials that are there, the chief secretary is supported by the permanent secretary, the treasury, similar class McPherson, and I am supported by the director general of finance, Alison Stafford and other officials. On the Barnett formula, is it right in any discussions that the Barnett formula has worked in the past continues in that way? Is there any—accept that there are changes to the Barnett formula in terms of tax regime and so on and the powers that the Scottish Government is going to have, but the formula for the Barnett formula, as has been for a long time, is remaining the same, is that correct? Yes, in relation to—subject to the application of the changes that arise out of this process, which will undoubtedly reduce the proportion of our budget that is influenced by the Barnett formula, that will be reduced as a consequence of what of this process we are going through. Then also, at each spending review, some of the comparability factors that drive the Barnett formula, so for example, on health expenditure we have 100 per cent comparability, so if there is a change in the health budget of the Department of Health in England, we get 100 per cent of the comparability factor in Scotland. On other budgets, on defence, for example, it is zero on other budgets that might be somewhere in between. Those comparability factors are looked at again by the Treasury, but the Barnett formula and the comparability factors are all part of the statement of funding policy. I can argue for changes to the statement of funding policy, but I am not a signature to the statement of funding policy. It is ultimately a product of Treasury decision making, and sometimes it invariably contains things with which I disagree. I am asking you to step into the realms of fantasy here, but if your prediction was found to be correct and the Scottish Fiscal Commission was found to be wrong, would that shake your confidence in the Scottish Fiscal Commission's prediction? I suppose that you establish bodies on the basis of the professional capability of which you think that they are capable. I take very frequent professional advice on the judgments that I make, and I subject them to test by the Fiscal Commission, by people who are eminently qualified to undertake that role. Those arrangements should give us confidence that we will get a good product and a good outcome as a consequence. Would you accept that we could, even on the situation that you have explained, that your prediction could be right? That you were right to be more optimistic? That could be the case, yes. Of course it could be. It certainly could be, yes. That has an interesting point in why having transparency with two separate forecasts aids scrutiny and transparency over the process of your fiscal policy. I heard the discussion between Mr Mason and me where having separate forecasts was described as duplication, but would you not accept, Cabinet Secretary, that in other countries that is simply regarded as good practice and encouraging greater transparency over the Government's fiscal policy? In some countries that is the arrangement that is in place in other countries it is not. The model that I think is appropriate for us, given the issues that we are wrestling with, is to establish an independent commission of professional authority and integrity and enable that to challenge the forecast that the Government makes. Cabinet Secretary, you are not going to achieve agreement on that issue clearly. My final question then is on the issue of no detriment. I wish that you discussed the issue with the convener earlier. You said that you did not want to have a mechanistic approach to a no detriment policy, but the cabinet secretary's reassurance in terms of the fiscal framework is that when this Parliament in future makes decisions over issues such as APD, where there may be an argument over the necessity of implementation of a no detriment policy, before taking such decisions on those policy proposals, the Parliament would be aware of whether there would be a no detriment policy or some description to be applied in that instance. That would be a product of the fiscal framework as to whether, essentially what Mr Baker is driving at is what I might describe as second stage no detriment questions. First stage no detriment, I do not think that there is much disagreement about you undertake a fair netting off of the tax that is raised. There is then a question about what you do if there is an effect, an economic effect, that is that it is essentially clawed back from the Scottish Government as a consequence. I think that that rather undermines the whole point of undertaking some form of devolution. Surely, if we are having those powers, they should be used to deliver different and better outcomes. In a sense, the point that Mr Baker makes will be answered by whatever is in the fiscal framework. I am keen for us to get that right at this stage and not to have to revisit the fiscal framework in years to come. That would be disadvantageous if we had to do that. That concludes the questions from the committee. I will get one further question. The Scottish Fiscal Commission indicates that, in January, it is working in relation to forecasting for stalling for land-building's transaction tax. I am just wondering whether that has been completed and whether there has been a comment on the forecast. The work is still under way. We will have much clearer data from the end of the last financial year, and we will be discussing those issues around stalling with the United Kingdom Government as part of the fiscal framework. Thank you very much for that. That concludes our question today, unless there are any further points that the cabinet secretary has to make. Thank you very much for answering our questions. That also ends the public session, but before we conclude the private section, I thank Malcolm for his contributions to the committee. He has been a very key member of the Finance Committee over the past couple of years, and we will be sorry to see him go. I wish you best in the next committee that you move on to. Thank you very much for your hard work. That concludes the public session. We will call a five-minute break to allow the official report on public to leave.