 The next item of business is a debate on motion 4815, in the name of Liz Smith, on economic priorities. I would invite those members who wish to speak in the debate to please press the request to speak buttons now, and I call on Liz Smith to speak to and to move the motion up to 30 minutes, please, Ms Smith. Thank you, Deputy Presiding Officer. There are really two reasons behind the Scottish Conservatives asking for this debate this afternoon. Firstly, a 30-minute statement last week, with less than an hour prior to that, to digest very significant amount of economic analysis, was not satisfactory in terms of this chamber's parliamentary scrutiny time. Secondly, this is the first projected longer-term outline of the Scottish Government's fiscal policies since 2011, a timeline that we welcome, so we believe that extended scrutiny is absolutely essential, particularly at a time of very challenging economic circumstances. Let me begin by stating some of the key facts. The Scottish Fiscal Commission's December 2021 statistics show that the overall Scottish Government budget for 2022-23 would no longer receive on-going Covid funding as the pandemic eased. What is also correct, however, and the cabinet secretary should know by now that all the expert statistics, including those from SPICE and the Institute of Fiscal Studies, confirm that the real terms block grant received from Westminster was the largest in the history of devolution and is set to rise in real terms for the lifetime of this Parliament, and the Scottish Government received around £15 billion of additional Covid spend for the previous two financial years, and that the Scottish Government has had £7 billion more to spend than it expected four years ago. Here are some more facts. Income tax revenues are growing more slowly than the Income Tax Block Grant adjustment. The Institute of Fiscal Studies predicted that income tax revenues will be around £428 million less than it would have been the case if the income tax had remained within a UK tax structure. From 2024-25, the UK income tax rate will reduce to 19 per cent, but as yet there are no signs of the Scottish Government making the same commitment, and I'll come back to that later. The social security spend is set to rise from 10 per cent to 14 per cent within the resource budget. The size of Scotland's labour force is falling as the labour market participation rate, and then there is the huge black hole in the public finances, which yet again, this time at the Finance Committee, the finance secretary told us doesn't exist. On top of those facts is the backdrop to the current economic situation. As Dame Susan Rice spelt out last week, the war in Ukraine, the significant increase in global energy prices and difficulties in international supply chains, most especially those related to China, are creating serious challenges to every single economy across the world. It is perfectly true that there is greater uncertainty within the economy than was the case in December 2021, when forecasts were published. Likewise, what is also correct, and I repeat my views from several previous debates in this chamber, is the fact that there are aspects of the current fiscal framework which exacerbate uncertainty, because it does not help that there is very considerable time lags between and sometimes a divergence between the forecasts of the SFC and the OBR, and it doesn't help that the framework is not inflation-adjusted. Two aspects that I hope will be resolved in the current negotiations of the new fiscal framework are concluded. But neither can the cabinet secretary blame the fiscal framework on Westminster, because it was her predecessor John Swinney, as well as UK Government ministers, who signed up to it in 2016. The long and short, Presiding Officer, confirmed by all the economic forecasters, is that the Scottish Government is spending too much in comparison to what it is raising. If the cabinet secretary doesn't like the term black hole, let me try the term shortfall. Let me remind her of what David Phillips of the Institute of Fiscal Studies said last week. I quote, "...a series of expensive spending commitments on top of the underlying spending pressures mean that the Scottish Government faces a multi-billion shortfall over the next four years." We know that, as a result of all that, the cabinet secretary has decided to make savage cuts to public sector jobs. The new statesman, I think, was offered the view that this includes many jobs in Government agencies, such as Quangos, Transport Scotland, Marine Scotland, Food Standards and Sea Parole, mentioned in his article, so we'll see what happens here. I'm sure that the public will find it very difficult, indeed, to understand why on earth such substantial real-term cuts are to be made to the following. To our police who are on the front line of keeping our communities safe, to local government services, to trade and enterprise, to tourism and to our universities, which the cabinet secretary admitted yesterday, are integral to the realisation of the national economic transformation strategy, in which plays such a vital role when it comes to developing research and development and innovation. This is exactly the same public who will see the profligacy of the SNP Government wasting vast sums of public money on ferries that don't sail, by-fab, presbyt airport, the malicious rangers prosecution, the list goes on. Of course, there is the £20 million preparing for a second referendum. Yes, I will take an intervention. Thank you very much and thanks to Liz Smith for taking an intervention. Yet again we've got the Conservative Party in this chamber talking about the ferries being a waste of money. Is Liz Smith certainly in this chamber saying to the population of Inverclyde, is Liz Smith saying to the workforce of Ferguson that they are a waste of money? Liz Smith, I can't believe that that question actually is absolutely patently obvious about the extent of the waste of public money that is being afforded by the SNP Government. That is totalling up almost week by week. Therefore, taking away an awful lot of the money that should have been used in order to finance the public books. Can I just remind the chamber what Audit Scotland has been saying about parliamentary scrutiny over public money? That perhaps might go to answering another part of that question that I've just been asked. The Scottish Government, again I quote, the Scottish Government needs to be much more proactive in showing where and how money is spent and showing a clear line from budgets to funding announcements to actual spending. That will support scrutiny and transparency and that, the cabinet secretary is exactly the same conclusion as the Finance Committee came to in this Parliament. Let me turn to the tax issue, which is central to the problems currently facing the Scottish Government, both in terms of the disincentives and in terms of the weaknesses of the tax take. The cabinet secretary has been saying that Scotland has a very progressive income tax policy, but she should heed the warnings of the Scottish Fiscal Commission, in the next five years Kate Forbes will have 700,000 middle earners in a higher tax bracket. Neither should the cabinet secretary forget that, in December, the Scottish Fiscal Commission dismissed her claims that the majority of Scots would be paying less tax. That is simply not borne out by the evidence. Of course, the disincentives that come from this are likely to be significant and most importantly Scotland's divergence from the UK income tax rate threatens to damage Scotland's competitiveness, which is why we want to see a return to parity as soon as resources are allowed. John Mason. Will the member accept that, through the different tax policies, we have raised £240 million extra for 2018-19, which are the latest figures? If we didn't have that money, there would be further cuts to police or anything else. Mr Smith. Mr Mason sits on the same committee that I do that has been scrutinising the finances, and he will know exactly what some of the projections are about the downturn in the tax take in terms of the revenues that we are suffering from. That is exactly the problem that I am referring to in this. The tax revenue situation is the most worrying of all, since not only does it reflect the very serious challenges about the primary source of Government spending, but also serious imbalances in the Scottish economy. Those imbalances, most especially those relating to the labour force, mean that it is highly likely that we will continue to lag behind the UK when it comes to several key economic indicators, because higher tax rates are not delivering the higher tax revenues that we need, and that is obviously a very serious concern. Yes, of course. Is he just made a comment that is contradicted by David Phillips from the IFS, who says explicitly, and I quote, is almost certainly have raised revenue. Who is right? Her or David Smith? Of course the tax revenues are up in that sense. Of course they are, but Cabinet Secretary, they are not up to the extent that, as a Scottish Government requires for the spending, there is a huge divergence just this morning at the Scottish Fiscal Commission breakfast on the graph. That was very patently obvious, and that is a very serious concern. The context of that is also set out by the Scottish Government's approach to the north-east and the oil and gas sectors, sectors that encompass a large number of well-paid, highly skilled workers whose tax contributions to the Scottish economy are extremely important, and that has become a problem because we know only too well that the SNP wants to rip the heart out of these industries. Those issues about tax revenues were set out in very stark terms by the Parliament's Finance Committee, and I remind the Cabinet Secretary of its unanimous conclusions in that. I quote, The committee believes that such is the outlook for Scotland's economic performance and the downward pressure on the Scottish budget requires greater emphasis on prevention and reform, and it wanted the Scottish Government to streamline and make much more coherent its policy strategies. In paragraph 97, I quote, we consider the evidence showing Scotland is lagging behind almost all other areas of the UK in key economic indicators of economic performance. That is deeply worrying. I have mentioned two changes that we would like to see delivered by the Scottish Government to return to priority when it comes to income tax rates, so that Scotland is not disadvantaged, and a finance bill that would enhance the scooter day of public spending decisions. The crucial element in all of that are policies to enhance economic growth, even if the SNP's partners, the Greens, do not agree with that. Scottish Future was absolutely blunt in its analysis last week and described it as the elephant in the room, because it says, and I quote, is Scotland's long-term failure to increase its growth rates relative to the UK. Scottish Future tells the Scottish Government to stop throwing good money after bad on non-productive projects, and it cites the illogical decision to cut spending on university research as one example. We agree with that. Just as we do about ensuring that there is a much simpler and more easily understood pathway through the enterprise bodies and the grants that they can award, it is just about everybody in business wants that change as quickly as possible, because they are keen to get on with boosting innovation and productivity without the red tape, without the form filling and the complex planning and procurement processes getting in their way. Business feeling good about itself and its future is absolutely essential if Scotland is to achieve the growth rates that we need. In recent weeks we have had several key business leaders saying that the national economic transformation strategy and the national investment bank do not have anything like the clarity and the rigor that we need to deliver growth. Business also wants to see Scotland's governments working together, not embroiled in constant bickering and constitutional wrangles which divert attention away from the important focus. A unanimous conclusion of the finance committee. Scotland has immense talent in every corner of the country. We need to mobilise that talent in every way we can. We need policies that support talent, which incentivise investment, which support our businesses or public services and a Scottish Government that is wholly committed to efficiency and transparency within the public finances and not a Government that is constantly peddling grudge and grievance at every turn and not looking after our finances properly. With that, Deputy Presiding Officer, I move the motion in my name. Thank you. Before calling the next speaker, I would remind all members who wish to speak in the debate to ensure that they have pressed the request to speak buttons. I now call on Kate Forbes Cabinet Secretary up to nine minutes, please. What this debate is really about is why and how Scotland cannot afford to remain under UK Tory rule. It is more than a little ironic that the Conservatives have initiated today's debate on the economy when their Westminster leaders are presiding over the sharpest fall in living standards and the fastest rise in inflation for a generation. They are the very symbol right now across the world of economic mismanagement. The true cost of Tory economic mismanagement is laid bare by external commentators. Research by the LSE's centre for economic performance revealed that Tory Brexit has caused food prices to rise by 6 per cent, deepening the cost of living crisis for households across the UK. Just today, the OECD has warned that next year the UK will have the worst economic growth of any G20 country bar Russia. The worst economic growth of any G20 country bar Russia. I am grateful to the cabinet secretary for giving way. Can I ask her what she felt about the finance committee's conclusion? We consider the evidence that showing Scotland is lagging behind almost all other areas of UK and the economic indicators of key performance areas is deeply worrying. Cabinet secretary. Which Government is responsible for faster GDP growth in Scotland in March compared with a fall in GDP across the rest of the UK? I will come on to another number of other metrics. All of that that I have just detailed is happening under the leadership of the very party who have brought today's motion. As I said although inflation is quite clearly also impacting other countries it is not impacting them equally. The UK currently has the highest inflation rate of any G7 country and almost twice the rate of France under this Tory Government. Under the current devolution settlement only the UK Government has the macroeconomic levers to fully address the cost of living crisis and they have spectacularly failed to manage our economy in a way that works for businesses and works for households. Poverty is rising, costs are rising the energy price cap is rising living standards are falling growth rates are dropping and competitiveness is sliding under the Conservatives. I agree with much with what the cabinet secretary said. The Conservatives are doing an absolutely appalling job at running the economy but isn't that making the case better? While we may not have all the levers he wants we do have levers which does not explain why wage growth is underperforming in Scotland compared to the UK average. Can she explain that? I will come on to that but I think the context here is important. I recently wrote to the chancellor with a comprehensive funding package that fully addresses the unprecedented rise in the cost of living rather than following this approach in using the fiscal headroom that is available to him to support people and businesses now the piecemeal package that he announced makes it highly likely that more support will be needed later when energy prices rise significantly in the autumn. In other words whilst people sit in cold houses right now and turn to food banks the chancellor is sitting on a substantial election war chest and in contrast and this comes to Daniel Johnson's point we are doing all that we can in response and our amendment to today's motion reflects the priorities that we have for Scotland's economy and for our public finances our prudent stewardship of our finances and our careful our careful ambitious management of the economy has resulted in the 2021 EY attractiveness survey finding that Scotland has been the top UK destination for foreign direct investment outside London for the past seven years Scotland's GDP growing 0.3% in March 2022 compared to a fall of 0.1% in the UK as a whole estimates for January showing Scotland's unemployment rate fell to 3.2% in the first quarter of this year a joint record low and below the UK rate of 3.7% and Scotland has a positive trade balance in goods exporting a billion pounds more goods than it imported in 2021 Willie Rennie The cabinet secretary is willing to take credit for those selective statistics is she prepared to accept responsibility for Scotland's overall economic performance which does lag behind the rest of the United Kingdom does she accept any responsibility for that? The irony of that question is that yes we have set out our approach to economic growth over the next 10 years recognising the work that needs to be done in terms of productivity in terms of new markets in terms of entrepreneurship but there is no way around the fact that the macroeconomic levers sit with the UK Government and if the Liberal Democrats want that to be any different then I suggest they join us in calling for those because we have done that with one hand tied behind our back this year alone whatever the Conservatives say we believe independent commentators this year alone Scotland's budget is being reduced in real terms by 5.2% and if we look I've taken quite a few interventions and I'm probably running low on time if we look across the whole four year period of the resource spending review our real terms funding is to grow by only 2% after accounting for the devolution of social security benefits the current fiscal settlement denies as even the most modest of borrowing powers that most Governments across the world would have access to powers that Scotland would have as an independent state so if we need another reason why Scotland cannot afford to remain under UK Tory rule researchers at the Glasgow centre for population health found that and I quote austerity is highly likely to be the most substantial causal contributor to the stalled mortality rates seen in Scotland and across the UK the Scottish people deserve better than that and they also deserve informed and intelligent debates on the true nature of our financial outlook so it's disappointing to see that the Conservatives have once again claimed that and I quote Scotland has imposed higher tax rates on Scotland without increasing revenues that is factually inaccurate it is contradicted by the institute for fiscal studies who stated last week and I quote we are not saying that tax rises have reduced revenue the tax rises have almost certainly raised revenue in the SFC's December 2021 forecast publication which I think Liz Smith has already referred to the SFC noted that the Scottish Government's decisions on income tax since 2017 to 2018 will add around £552 million to the Scottish budget in 2022-23 in the last six months we have set out our annual budget a strategy for economic transformation two medium-term financial strategies and a three-year resource spending review all of that with the backdrop of a pandemic and the biggest economic shock the most significant cost of living crisis in a generation and the illegal Russian invasion of Ukraine which is a humanitarian crisis that is affecting the global economy there could be no accusation that this government is shying away from its responsibilities on managing our public finances and Scotland's economy and managing them well it's despite those funding pressures and it is despite those pressures remaining with the UK Government that our resource spending review prioritises our limited resources on the Scottish Government's long-term ambitions for Scotland now other parties in this chamber may have different priorities but I strongly believe that the priorities that we have set out as part of this resource spending review are the priorities for the people of Scotland priorities of tackling child poverty the priority of economic recovery and the priority of helping households with the cost of living crisis it is our job as a mature, fiscally, responsible Government to deliver those priorities but Parliament needs to face up to the realities of where powers lie and the realities of a budget that gets cut by the UK Government Cabinet Secretary I can ask you to move the amendments moved 4815.2 I now call on Paul Sweeney to speak to and move amendment 4815.2 up to 7 minutes please Mr Sweeney Thank you Deputy Presiding Officer and it's a pleasure to open today's debate on behalf of the Labour Party and to move the amendment in my name I'd also like to thank the Scottish Conservatives for proposing their motion for the debate today and it is a debate that is long overdue and urgent following last week's demoralising spending review where the Cabinet Secretary attempted to heroically spin cuts that the Tories themselves would be proud of as fiscal prudence and has just done so again today but put bluntly the economic outlook for the next five years is nothing but grim we often hear warnings of economic uncertainty and it seems as though not a day goes by without headlines about record fuel prices record gas and electric bills and record inflationary pressures and of course those pressures all contribute to the economic forecasts we are discussing but the underlying vulnerabilities of the Scottish economy run far deeper than recent price bikes and the cost of living crisis so I was dismayed to read the Government's amendment to Liz Smith's motion it can only be described as burying your head in the sand rather than address the failures that they have presided over the Scottish Government have done their usual point the finger at Whitehall highlight the failings of the Tories rightly in that case but it also attempts to distract from the myriad of fears that they themselves as a Government have presided over in Scotland the underlying indicators of economic performance are clear for everyone to see the Scottish fiscal commission's recent forecasts highlight the stark reality that the challenges facing us all productivity stalling real wages falling and tax receipts significantly lower than previously predicted it's an economic forecast that many of us have been warning about for a long time but the cabinet secretary has point blank refused to accept this take productivity for example the Scottish fiscal commission states and I quote that productivity growth has stalled in Scotland since 2015 the single biggest important factor improving prosperity stalled seven years of absolutely no progress whatsoever despite repeated warnings the cabinet secretary can play the blame game all she likes and the amendment in her name attempts to do just that but it is abundantly clear that the government have no plan to approve productivity forecasts we see the same scenario when it comes to average earnings in Scotland every single year for the next five years Scotland is forecast to lag behind the UK as a whole it's not a recent phenomenon either between 2016 and 2020 earnings in Scotland increased at a slower rate than the rest of the UK and in recent years the fiscal commission state that the gap has widened not shortened and in fact since 2016 Scotland's average earnings have grown by 21% which is 5% less than the UK average over the same period and the picture happy to give away John Mason He's very good at listing some of the problems we've faced and I don't think anyone's arguing that these are challenges Can he give us some answers? Paul Sweeney I'm happy to accept the proposal for a superannuation given the cost of living crisis but I have to say that the key proposals are about efficiency of investments returning on investments there are huge endless opportunities to increase revenue and to get public investments raising more money for Scotland there are innumerable opportunities to outline this the Scottish Government and councils can be making big bold moves to be the main supplier of heating to all households and businesses in Scotland instead of multinational utilities for the national publicly owned and developed district heat networks but there's no state entrepreneurship that's just one example I could give the member to take into consideration indeed in his constituency of Dalmarnock where there are district heating schemes that are not being expanded and currently new build housing introducing and seeding a cost of living crisis in our midst when we could be doing something differently Deputy Presiding Officer I don't take any pleasure in pointing out these facts I want nothing more than for Scotland's economy to be prosperous, thriving and providing a solid foundation for the improvement of people's lives of course I do but the fact of the matter is that it is not it is underperforming and the Scottish Government need to take their share of the blame yes external factors have played a role Brexit Covid global inflationary pressures cannot be ignored but the problems I've outlined existed well before any of those external factors and have left our economy less resilient in the face of these shocks and the reality of what poor economic forecast mean in practice is stark last week the cabinet secretary outlined the Scottish Government's spending priorities health and social security budgets were protected but everything else was raided and the Scottish fiscal commission said in 2023 2024 and 2024 2025 spending in all other areas is expected to fall in real terms and in 2025-26 only the net zero energy and transport portfolios are expected to increase so there we have it in black and white austerity the very thing the cabinet secretary spent the bulk of her speech criticising in withering terms for the next three years the budgets afforded to local government education and skills the economy and finance justice the crown office and prosecutor fiscal service net zero energy and transport external affairs and culture will be hammered and the consequences couldn't be clear further cuts to local government will see further job losses drastically reduced services cuts to education and skills will see the attainment gap widen further and the life chances of our children decimated transport budgets resulting in even poorer services pushing people away from public transport costs and subsidy dependence at the exact time we should be encouraging them back but perhaps the worst consequence of all is the admission of scathing cuts to the number of public sector jobs in Scotland the point is perhaps most illustrative of the short sightedness of this government when it comes to the economy rather than investing retaining skilling up and increasing the wages of public sector employees they sack them with the profound personal and financial consequences that decision will have on families across Scotland it's a symptom of a government run by accountants not economists but Deputy Presiding Officer it doesn't take an accountant or an economist to see the perilous state the Scottish economy is in people can feel it in their pockets and in their pay packets every single day and unless something fundamentally changes and unless the Scottish government finally takes its head out of the sand we will continue on this managed decline and before we note will be too late to reverse the matter on is our amendment today states Deputy Presiding Officer the failure to grow Scottish wages will also mean that hardworking people in Scotland exposed the pressures of the cost of living crisis that needs to be the forefront of our minds squabble met constitutional arrangements firing figures across the chamber blaming the Tories cutting vital budgets won't help ordinary hard working people and every one of them needs to be laser focused on improving their lives in the coming years all the evidence I've seen so far suggest I think that focus. Thank you Mr Speedy and I now call on Alex Cole-Hamilton up to six minutes please. Thank you very much indeed Deputy Presiding Officer I'm grateful to rise for the Liberal Democrats to speak in this debate and I'm very grateful to Liz Smith for doing the parliamentary time for us to debate it. When the finance secretary outlined the government's spending review she laid bare the price of SNP economic incompetence. The truth is when it comes to the economy by almost every metric we are falling behind. The SNP like to take any opportunity they can to set Scotland apart from the rest of the UK while Deputy Presiding Officer when it comes to the economy they have accomplished that mission but there is nothing for the government ventures to take pride in in that reality. In the last decade under SNP rule the Scottish economy has been consistently consistently outpaced by the rest of the UK which of course means we have less money to spend on vital public services many of which are currently in dire need of funding. We've seen productivity growth stagnate while we failed to keep pace with earnings growth in England and Wales and I was very interested to see the cabinet secretary told Daniel Johnson that she would come on to that in her remarks but I must have fallen asleep because I didn't hear her come on to that at all and all of this has been coupled with downward growth estimates as Liz Smith rightly quoted in the words of Scottish Future Presiding Officer, project after project has been mishandled. There aren't enough workers to build even a handful of offshore wind turbine jackets at BiFab. Where are the 2000 jobs that were promised to Lochaber by the SNP Government and Sanjeev Gupta in return for taxpayer backing worth hundreds of millions of pounds? Why are communities going to spend years more without the broadband connections they need to do business and to get on with their lives? Presiding Officer, the Government may not like it, but their fiscal incompetence is plain for all to see. Not long ago, the word ferry would conjure up happy images of relaxed atrips to some of Scotland's beautiful islands, of island businesses expanding beyond their shores. Now it is synonymous with cancellations, botched deals, missing documents and horrendous, horrendous overspend. These were lifeline ferries promised to our island communities so they could go to work or attend hospital appointments on the mainland. They are years late and more than £150 million over budget. Tourist businesses, cafes and more must all be wondering what they pay their taxes for when their absence of sailing costs them hundreds of pounds each day in lost earnings. The same could be said for all the restaurants, bars, theatres, shift workers and commuters who are staring at rail train tables in disbelief. The Scottish Greens must be the only green party in the entire world to go into government, nationalise the rail sector and put a red pen through a third of the rail timetable. It has been reported that that is costing the Government and the Scottish economy £80 million each week. The Scottish Government had two years to prepare for its running of ScotRail, but it did precisely nothing to avoid the dispute. Every day, which the SNP Green Government fails to provide core connections, be they ferries, broadband or trains, can be counted and measured out in lost revenue to our economy. I'm happy to give way to Dan Johnson. Dan Johnson? I wonder if Alex Cole-Hamilton would agree with me that this transport disruption in the chaos isn't just a problem because of the disrupted journeys. It prevents people from getting to new opportunities and, given our regional inequalities, is a horrendous economic crime in itself. I'm grateful for Daniel Johnson's intervention. I absolutely agree with him. The £80 million that's been quoted in lost revenue is just the tip of the iceberg and will represent lost opportunity for growing our economy still further as well as all the social disruptions that I have laid out. The Government has also been good at wasting opportunities. When he was First Minister, Alex Salmond often spoke of making Scotland the Saudi Arabia of Renewables. Scotland was the best chance for generations for the Scottish Government to bring serious money into the public press, but, alas, it sold it on the cheap after the Government inexplicably decided to cap how much companies were allowed to pay in the offshore wind auctions. That was just by auction south of the border, comparable auctions and around the world showing that this is a fiercely competitive market, Deputy Presiding Officer. I mean, who on earth puts a cap on something they are selling in those circumstances? I will. Does the member think that £25 billion requirement to invest in the supply chain is selling it on the cheap? £25 billion. Alex, go on with that. I'm sorry, this is a very weak area for the Cabinet Secretary to try to defend. Anybody who's ever been on eBay knows that when you're selling something you'll possibly send on it. You don't put a cap on it saying please don't give us any more money than we're providing in these circumstances, but that is exactly where we find ourselves. The truth is that Scotland's prize seabed was sold at a pittance and this matters because it is income that goes straight or could go straight to the Scottish Government to be spent on schools, on hospitals, better pay for social care workers, but once again we are seeing that potential squandered. Presiding Officer, it is well past time for the Scottish National Party's economic mismanagement. The Government has its priorities all wrong and when it comes to allocating finances as I highlighted at FMQs last week, we recently learned the number of people suffering along Covid has risen to over £150,000, that's one in 30 Scots, yet the First Minister is devoting twice as much money to a divisive second independence referendum as she is to the entirety of this awful condition. The SNP Green Government is devoting its focus, top civil servants and tens of millions of pounds to an unwanted independence referendum and you need only look at the statistics published in the last 24 hours to see why this is indefensible. Over 300,000 operations now lost to Covid delayed discharges up 64% in a year, dangerous levels of nursing vacancies and thousands of children and adults waiting over a year for the mental health support they desperately need. Everyone needs these SNP and Green Ministers to be focused on what really matters right now. Instead NHS staff... I will conclude with this, NHS staff, patients, islanders, hospitality businesses are all being taken for granted and it is shameful. Thank you, Mr Cole-Hamilton. We will now move to the open debate. There are six minute speeches and I call Douglas Lumsden to be followed by Michelle Thompson. Thank you, Presiding Officer. It's good to be discussing this important topic since we were not able to last week as my colleague Liz Smith pointed out. This spend and review highlights the mismanagement of our economy by the SNP Green devolved Government. With the highest core block grant ever coming from the UK Government, a more investment in Scotland than we have previously seen, it's ridiculous to see an SNP Minister defend their economic decisions as we saw last week. Let's be clear, the tough decisions that this devolved Government are a direct consequence of their economic incompetence. At the finance committee yesterday, I questioned the cabinet secretary on public sector job cuts. At first, I was given the usual smoke and mirrors, as we expect from the SNP, but eventually the figure of back-to-pre-COVID levels was mentioned. Most of that increase, if we look at it, was in health and the cabinet secretary said there won't be cuts there. We have over 1,000 now and that won't be cut. We have an expansion of ELC, so I presume that the Scottish Government won't be reversing that policy. So we can only presume that the hammer will fall in other areas, like policing, like firefighters, like teachers, like social workers, like carers, like refuse collectors, like road workers, like lecturers who we need to upskill our workforce. Yes, of course. Is the member distancing himself from his Conservative counterparts in the UK Government? Dr Slumson? Once again, we are in Scotland, but at least there is a bit of clarity. What we have for the cabinet secretary is more smoke and mirrors all the time. She gives no answers of where the jobs will be cut. The cabinet secretary needs to come clean with her public sector workers and let them know where the planned cuts to the workforce will take place. Presiding Officer, I want to focus on the impact of local government cuts proposed in this spending review and the impact of the wider economic situation on our vital public services. I have spoken before in this chamber about the importance of prevention in all our public services, the need for investment into preventative services that stop greater expenditure further down the line. That is what I would like to focus on today. A view that I thought was shared by many across this chamber. This review spending has told us that the SNP-devolved Government is planning to cut the budget for local government by 8 per cent in real terms by 2027. The Government suggests on how the local government will make those savings, reducing real estate, increased digitisation and more shared services. That advice to local government is actually an insult. It is teaching your granny how to suck eggs. This is what local government has been doing for the last five years to balance the budget in the face of SNP austerity. For many local authorities, the low-hanging fruit has gone. The efficiencies through digitisation have been achieved. The headcount reduction in conjunction with unions has been done. Presiding Officer, this deal means that jobs will be lost, bins will be collected less often, care packages will be cut, new schools will not be built, roads will not be repaired, sports facilities and libraries will be closed all on this Government's watch. It's a disgrace. I'm very grateful for Mr Lumsden giving way the RSR forges the opportunity to consider our spending some six months out from when a budget will be presented. Can Mr Lumsden state what the total quantum he believes should be allocated to local government in the next financial year and following financial years? I'll come on to the waste that this Government makes all over the place. The more transparency around the budget process, it might be easier to answer. We'll have things in the budget for this year, like 620 million of a line of things that might come in, including Scotland. That's been taken out of this year's budget, into next year's budget and suddenly the 620 million has miraculously just reappeared again. Prevention is much better than trying to tackle the outcomes of such a steer measure. Our sports and libraries aid in health and wellbeing and prevent long-term illness. Our schools and youth clubs cut down on crime. Good roads cut down on accidents. New schools increase attainment and opportunities for all, have taken enough. Cutting investment in our local government is short-sighted and will lead to greater cuts down the track. The SNP is also cutting off investment from key sectors such as oil and gas which will have massive implications for the north-east and the Scottish economy. We heard at the SPICE SFC breakfast meeting this morning that one of the reasons our economy has fallen behind the rest of the UK is the decline in the energy sector and the income tax take from it. It's clear that the SNP Government do not back the oil and gas industry and they're driving investment away. While we still have a demand for hydrocarbons it's better for the environment and better for the jobs in the north-east that the energy industry in this country is protected and supported. This devolved government's outright hostility to the industry is directly related to the cuts that they are having to make to public services and the need to change their tune before it's too late. Much has been said today about the cost-of-living crisis. Time will not allow me to go into detail here but the UK Government have now provided over 37 billion of support to families. Families in Scotland will have to pay more income tax than the rest of the UK, a point that was covered earlier by Liz Smith. That is the Scottish Government's contribution to the cost-of-living crisis, higher taxes. What has this devolved government doing with our taxes? 250 million on ferries that do not sell. 40 million on the doomed malicious prosecution of rangers. 50 million on loans to BiFab and now 20 million allocated for an independence referendum next year. 50 million more than they have allocated as an increase in the education budget. Colleagues, this is an absolute disgrace. This Government holds an obsession to having a referendum above the education of our children. Presiding Officer, this spending review has so many areas of concern that we can only skim over today. I know that we will have more sessions in committee, maybe, to go over in detail. But this SNP green coalition will need to put the needs of the people in Scotland at the heart of their policies and not of the obsession with independence. We need more spending to our local authorities to deliver our vital services. We need this false notice. Mr Lumson, could you please conclude your remarks? Thank you very much. I now call Michelle Thomson to be followed by Michael Marra up to six minutes. Please, Ms Thomson. Thank you, Presiding Officer. If the last few days have taught us anything, it's that the price of dependence on this failing UK state and leaders like Boris Johnson makes the need for Scottish independence all the more urgent. Economics. Economics. And I say to you all, cannot be understood without a deep appreciation of society. And this was fundamental to the work of Adam Smith. To understand his wealth of nations, it's best to read his earlier work, the theory of moral sentiment and the theory of moral sentiments. Smith knew only too well the importance of justice, of effective administration of the law, of ethics, of human behaviour and the importance of empathy towards others. All issues this Tory Government in Westminster shows little regard for. Happily. I thank Michelle Thomson for giving way. Adam Smith also talked very substantially about the importance of economic growth. Could I ask Michelle Thomson to expand on what her Government believes are the most important features of improving economic growth? I'm delighted to take that intervention because I'm going to go on and reflect much more carefully on economic growth and GDP and so on. Besides a lack of morality, I notice too the absence from the Tory motion of any mention of Scotland's assets. Now we know the track record of exploiting Scotland's resources such as those in the North Sea and, of course, Norway invested in their future, creating a fund for long-term investment, while successive UK Governments squandered the riches. At that point, there was no empathy with the needs or indeed the rights of the Scottish people as long as our friends in the city of London were doing all right, thank you. Now, Scotland, today we have the prospect of an even larger and longer money asset, with wind and seas driving a revolution in sustainable energy production. I commented only earlier today in this chamber that the anticipated energy production capacity of Scotland will far exceed even our own 2030 target. We need to put the needs of people and society at the heart of our economics. So who do you trust? And I ask the people of Scotland to focus on the right outcomes, but a Government elected by Scotland, for Scotland or Boris Johnson. The Tory motion talks of concerns around the revised downward growth estimates that fails to acknowledge the failure of UK Government policies contributing to this. Now, let's take the last 20 years and run an international comparison of growth rates in GDP. What do we find? The UK's growth was 68 per cent in nominal terms whilst the average large advanced economy grew by 93 per cent and the average small advanced economy grew by 138 per cent. That is double the cumulative growth of the UK economy. The UK failures a heavy price Scotland has to pay for being tied to its economic mismanagement particularly in comparison with other medium-sized advanced economies, many of which have a weaker asset base in Scotland. If he is going to directly counter my figures and give one's better of why I'm wrong, are you going to do that? I'm just curious to know why Scotland's growth figures have the rest of the UK. Can you please explain that one? I can refer directly back to the cabinet secretary's comment. Those benches over here the Tory Benches seem incapable of understanding the difference between micro and macroeconomics. I would encourage you to look at exactly which powers reside in Westminster and this is absolutely the crux of the debate. If this motion had any genuine concern about growth or understanding of economics it would be shouting from the rooftops for Scotland to have the full powers I notice too that the motion says nothing about the straight jacket imposed on Scotland by our lack of borrowing powers already referenced by the cabinet secretary and they complain about highly uncertain forecasts and they didn't mention that UK public sector net borrowing was £151.8 billion in the financial year ending March 2022. So if it's good that the Government of Boris Johnson can borrow so freely why is the Scottish Government denied these powers? The pseudo economics of the Tories we also know turns a blind eye to corruption and large scale financial crime that distorts the markets I've only got one minute left sorry and punishes consumers and businesses that play by the rules. The egregious law breaking of Boris Johnson really matters because not only does it display a disregard for both our society it also permeates into the economy and as long as Boris Johnson indeed most of the Tories care not for money laundering and other forms of financial crime counted in the hundreds of billions annually according to the UK's national crime agency as long as they care not for the distortions created in markets in the wider economy as long as they care not for the people that are supposed to serve the state capture that's taken place in the UK will continue in both society and our economic system but the most objectionable aspect of the Tory motion is the undercurrent I've tried to force a feeling of helplessness and dependency in Scotland they seek to damage the Scottish people's belief in themselves they seek to feed the myth there is better to allow people like Boris Johnson to be in charge rather than us being accountable for creating our own future and of course this explains in my last closing comment that I've allowed the Scottish people to decide their own future they will fail to stop us doing that Scotland will be the wealthiest country ever to achieve political independence and put the people of Scotland in charge of our own future thank you I now call on Michael Marra to be followed by Paul McLennan up to six minutes please Mr Marra thank you deputy thanks to Liz Smith for moving the motion and bringing this debate to the chamber I'm happy to support the amendment in Paul Sweeney's name I want to start by directly quoting the remarks made by the First Minister from six years ago that excellence in education is essential to our prosperity competitiveness, wellbeing and to our overall success as a nation and with those remarks I think I couldn't agree any more and yet the resource spending review that we had last week is a damning indictment of what the priorities of this Government truly are and to suggest that education is by any means up there is an insult to the intelligence of the Scottish people what once was the defining mission a sacred cause well none of that was true was it so in response to the cabinet secretary spending review the fiscal commission have made it clear that government spending on colleges and universities will face a real terms cut of 8% and these cuts won't just devastate colleges and universities they will tear through every tier of our education system from local government and early years schooling to academic innovation and research and at the heart of these cuts lies the inability of the SNP to reconcile themselves with the reality that a strong properly resourced education system is integral to the Scottish economy and frankly cabinet secretary it is the single greatest economic lever that we can and we ever will have in this country the net output of properly investing in our education system and by extension in our young people strengthens and diversifies our workforce in our society where proper investment is crucial from preschool to PhD in order to fulfil job vacancies to nurture talent and support economic development in fact research from London economics shows that for every £1 million of Scottish Government investment in university research £9 million of economic growth is generated and as colleagues have already hired out we can do with some more of that yes. Broadly it is his argument that we should be putting more into education and less into social security. Mike Marra. I suppose this is a question of priorities and I think Mr Mason is right to highlight it. It is choices that we have to make as a government. I would say that other colleagues have set out issues about waste and choices that are put to the Scottish people in elections when you say that actually your priority is education, that it is a sacred mission is defining purpose of this Government then you have to actually back it up with action either one set of those words are true or the others can't be true at the same time. I would say that these are the choices that you have made and Labour will put forward the choices that we will make also but it's not a fixed budget in the way that members would wish to present. We can grow our economy, we can grow in our coffers and we can ensure that we have a better tax take in our country. I think it is particularly troublesome that the SNP choose now precisely when our schools, colleges and universities finally are having to deal with and have the chance to pull back from the rubble of Covid and the resultant educational deficit that that is left behind that this Government has chosen to hit schools, colleges and universities with a further blow. I'd hope sincerely that the Cabinet Secretary in the spending new at the very least would have recognised the need to invest in that particular cohort of students. Young people who have suffered so much over recent years, who have lacked a large amount of their education and whose life chances are particularly hard, but there has been and I know that there may be talk of that in future budget but this spending review sets the very clear direction of the trouble ahead for all these services and so that incredible disruption over the last two years will take an immense toll on their academic and their mental wellbeing, not just for the moment but for many years to come. Colleges are already dealing with substantial cuts in this financial year already. The education committee heard this morning of voluntary redundancies across the sector and indeed potential compulsory redundancies. Let me remind the finance secretary that this is a very sector which is meant to handle the energy transition in our economy which members have mentioned, the need to transition to the net zero economy. That's where we have to make sure that we have the investment and the support. Scottish universities have delivered just in the last couple of weeks outstanding REF results in the research excellence framework and they have been rewarded as well with cuts, while simultaneously research funding in England has shot up. On the same day as the resource spending review UKRI announced 31.7% increase for research over three years. That is the competition. That's the reality. Our universities have to compete in that marketplace. They have to work to recruit the same staff, outstanding excellence staff from across the world and we have to make sure that we match those terms and we have the ability to do it. That compounds a long-term trend and I would say to members in the SNP that eight of our top 10 universities in this country have progressed at a slower rate than the comparators in the rest of the UK. There are direct consequences for that. What has been a national advantage in this country? We have previously captured 15.4% of UKRI funding. That's reduced to 12.9% now and it's a trend that is only going in one direction and is being further exacerbated by the decisions that are taken today. All of this does result in the points made by colleagues. A productivity that has stalled since 2015 failure to grow wages and the direct impact that has on people, I certainly will. Richard Lochhead. Does the member recognise the biggest threat to research funding being mooted by the university sector in Scotland? As we speak, it's the threat not to participate in the horizon by the UK Government and therefore that's a perfect example of how the UK Conservative Government is damaging research in Scotland and that's the priority of the university sector at the moment. Michael Marra. I certainly would agree with the member that it's entirely irresponsible to withdraw from the horizon programme. It's a massive issue and the amount of money that's brought in through horizon programmes to Scotland is dwarfed by the central funding that is provided by UKRI and the Scottish Funding Council. The proportion is actually just as important if not more so. The Government has long known the challenge of demographic transition and I'll conclude on that. I appreciate the leniency. There has been no substantive programme of reform to address any of that. Michelle Thompson is keen to talk about Adam Smith although I'm not sure he would agree with her on the ideas of throwing up trade barriers across the UK. I would more point towards the work of Marianne Masocuto, the idea for an entrepreneurial state that can actually grow our economy, invest in our people and build a better future for Scotland. I now call on Paul MacLennan to be followed by Alexander Stewart up to six minutes please, Mr MacLennan. Thank you, Deputy Presiding Officer. I thank the Tories for bringing forward this debate this afternoon. This debate allows us to compare the policies of the UK Government that is failing Scotland and the benefits of an independent Scotland. The Tory motion mentions downward growth estimates and decline in real earnings in labour market inflexibilities. The main levers of weak and weak powers are still held at Westminster. I'll mention that impact with these in my speech. No, I'm just starting. The Tory motion highlights the failures of the union and the negative impacts it has on the Scottish economy. Britain's economy is in a bad place. Removing Boris Johnson might help. That was a headline and analysis by CNN Business Analyst. She said that Boris Johnson survived a vote of confidence from Monday triggered by MSPs for his own party. She then went on and said that he'd been angered by Government parties that broke coronavirus rules. It's hardly of a deteriorating cost of living crisis and a dearth of clear policy goals. This is how others see the UK. She then went on and said that the cost of living crisis has been caused in large part by global factors but has been very significantly exacerbated by Brexit. The UK economy ground to hall in February and started shrinking in March. No, I've just started and it's continuing down that route. We are heading into a recession. Retail sales fell in May for the second consecutive month. The British Pound has plunged almost 8 per cent against the US Dollar this year alone. Losing even more against the Euro impacts on Scotland. The Pound is the third worst performing major currency this year. Only this morning, the cabinet secretary mentioned that the OECD is forecasting that the UK will have the lowest growth rate and highest inflation rate in the developed world. Apart from Russia. Stagflation, here we come. He spoke about independence and he spoke about currency. Can we confirm what a currency would be in independent Scotland? That's been out in the growth commission for everyone to see. Last week the Bank of America strategy stated investors should hedge for an existential sterling crisis as the British currency faces struggles usually seen in emerging markets. CNN state around the world consider facing huge economic challenges but the United Kingdom is in a particularly bad spot. They went on to say that the knock-on effects of Brexit have led to crippling labour shortages and boosted operating costs for businesses making the spike in prices even worse. Inflation in the UK reached 9 per cent last month. It's above the 8.0 per cent rate in the US and Germany's 7.4 per cent. Japan and economy characterised below information for decades as a lowest rate at 1.2 per cent. Inflation, this impacts on Scotland's UK Government policy. Both Tory and Labour parties are keen on avert to talk down the Scottish economy at every opportunity. Of course, this is fuelled by the independence debate on whether those parties need to highlight the negatives and ignore or dispute the positives when it comes to Scotland's economy. Last week, last year's university issued a report highlighting to people across the UK that they are dying younger because of UK Government austerity with people living in the poorest areas hardest hit. It went on to say that mortality rates are related indicators such as life expectancy are important markers of the health of a population. However, after 2012, life expectancy stopped improving and death rates among those living in the poorest areas have increased. Scotland spends over £700 million a year mitigating Tory welfare policies. That impacts on our ability to spend on other areas. That impacts on Scotland's UK Government policy. Let's recap. What impacts on our spending power on our fixed budget? Scotland has no powers regarding interest rates. No ability to vary national insurance rates and hasn't had no say over Brexit. Of course, the Labour Party supports that position. Inflation at a 40-year high, the highest rate in the G7, a currency which I quote has emerging market characteristics and which analysts are advising investors to hedge against. I'll take that intervention. Mike Marra. He cited the growth commission position as his own on currency but that wouldn't allow for control of our interest rates either, would it? Paul MacLennan. The growth commission stated that it would be in the initial position and then move on to our independent currency. That's the set rate. Of course, in control of our and of course in Brexit which we are still feeling the impact of on and of course which the Tories have never even mentioned in this debate not once. Not one MSP in debate on the Tory bench. So what can Scotland influence? Scotland has its very own inward investment and trade agency in the SDI international. The organisation that is performing is very much under the control of the Scottish Government. Ernst and Young last week published a survey saying how well Scotland is doing on the FDI front relative to other parts of the UK and to countries elsewhere in Europe and funny enough that's never been mentioned by the Tories either. Scotland outpaced UK-wide progress significantly. Scotland achieved a 14 per cent rise in the number of inward investment projects secured in 2021 to 122. Putting a one-point increase in the UK and the Shade and countries across Europe saw an overall 5.4 per cent rise of FDI projects retracted. The increase in the amount of investment projects worn in Scotland was the fourth consecutive annual rise. The past year in Ernst and Young has seen that the number of investment projects has increased significantly The past year in Ernst and Young has stated that Scotland continues to make great strides as a destination for FDI meaning that it can look to the future with even greater confidence. Scotland's record levels of attractiveness is underpinned by investors rising per sections. How will there see Scotland? Estonia regained independence in 1991. Its GDP has since increased fivefold and today it recognises Europe's Baltic Tiger. Slovakia, after a velvet divorce from the Czech Republic was 60 per cent in 10 years thereafter. Denmark and Norway have higher GDP than that of Scotland of between 30 and 40 per cent. Are there lessons for Scotland or are there circumstances simply too different as our opposition would tell us? To conclude, the UK's stewardship of the economy is failing Scotland. Scotland is on a journey to independence. The right to like every other independent country to choose its own path. Run its own economy and rejoin the EU. Scotland is on that journey and will find its way home soon. Scotland will retain its rightful place in the world. I now call Alexander Stewart to be followed by John Mason up to six minutes. I am grateful for the opportunity to speak in today's debate supporting the motion in the name of my colleague Liv Smith. As Scotland continues to recover from the economic damage of the last two years, careful management of the economy should be one of the highest priorities for the Scottish Government in the coming years. Today's debate is an important opportunity to highlight some of the SNP Government's failures in this area. As the recent analysis from the Scottish Fiscal Commission confirms, the economy is an area where this Government's record is one of wasted potential and failure. One area where such failure is abundantly clear is on income tax. As with so many areas, income tax is something over which this Government has received substantial new powers only to fail to use them properly. The introduction of two additional income tax brands in Scotland was supposedly done to create a more progressive tax system. Regardless of the Government's intentions this does not justify and has been described by the Institute of Fiscal Studies is unnecessary and complicated. Of course this Government may claim that a more progressive tax system means that lower income households pay less tax and they would otherwise. Given that analysis, the IFS finds any savings from these households to be barely apparent in a clear cut from the system has not been achieved. What does this Government have to show in the fiscal meddling in Scotland's tax system? Over 400 million less than if it had simply stuck with the UK tax bans according to the most recent analysis. This is yet another example of this Government receiving sufficient and significant new powers only to completely misuse them. It is perhaps the IFS when it summarises its best views that it states that the SNP's tax changes achieve little more than a political statement. A political statement that is tackling poor individuals the length and breadth of this country hardworking families paying more. We know from all the economic statistics that there is a substantial black hole in the public finances. That is despite the UK Government block grant providing real-term increases in funding for every year of this parliamentary term. Although IFS analyses and suggests that the deficit could turn out to be significant we already know that cuts to vital public services are being faced across to fill the black hole. Education and policing budgets are set to be hit in real-term cuts over the lifetime of this Parliament and, surprisingly, it will once again be local government that will bear the brunt of these cutbacks. The Scottish Fiscal Commission analysis suggests that local government budgets will be cut by 7 per cent in real terms by 2027. Even taken by itself, a figure of such magnitude should set alarm bells ringing for this government. We must not forget that there will also follow from the decision from councils. Councils have seen their budgets slashed between 2014 and 2021. They have fallen by 2.4 per cent in real terms. They have also received 250 million real-term cuts into their budget for 2022-23. More and more often, communities across Scotland are seeing councils faced with the choice to provide only the services that they are legally obliged to provide. On current forecasts I fear that this trend is set to continue, where local government will see budgets removed, individuals will see facilities closed, families will see no opportunities within their communities and this is at the best for this government who want to achieve that for their communities and our constituents. We have now had 15 years to learn about the SNP's economic priorities in government and it is clear that local government has never been one of their priorities never been one of their priorities. As the spending review makes clear this is something that looks obviously unlikely to change. This is the first opportunity that I have had to highlight the issues in my new role of shadow for just transition, economy and fair work. It will certainly not be the last time that I highlight the SNP's failures in this area. This Government has a lot of work to do to get Scotland's economy back on track to deliver budgets that are truly reflective of Scotland's public priorities. The Scottish Government should commit to aligning some tax rates with the rest of the United Kingdom. It must also work alongside the UK Government to capitalise on the potential for both Scotland's Government working together. The city regions, the growth deals which are now covering nearly every single part of Scotland have shown what can be achieved and what is being achieved by cross-government co-operation and Scotland's public will rightly expect to see more of that in the coming years. In conclusion, the Scottish Government should drop their plans for a divisive and desperate independence referendum for the Scottish public simply do not want it. We had a choice, we made our choice and to put £20 million aside is an absolute insult to these hardworking families the length and breadth of this country. I support the motion in Liz Smith's name and I urge individuals across the chamber to do likewise. I call John Mason to be followed by Katie Clark. Thank you very much and I am more than happy to take part in today's debate. Clearly we are facing challenging times financially and economically and inflation is a major part of this. The war in Ukraine with its impact on both energy and food prices has been very much outwith the control of the Scottish Government and in fact of most Governments for that matter yet we are now having consequences. The decline in real earnings is important not least for those personally impacted. We discussed this at some length on Tuesday at the Finance Committee and a lot depends not just on what level inflation peaks at but also how long higher inflation continues. If it is just for one year and there is then a rapid reduction in inflation to the target of 2 per cent or thereabouts many employees might live with that. However if higher inflation continues longer with a spiral of wage and price inflation then we all face serious problems. I would like to look a little more closely at the Tory motion and especially the suggestion that tax rates are higher without increasing revenue. They then have a comma and the phrase compared with the block grant adjustment. At the very least I consider that to be poor English but I suspect it has been done deliberately to try to confuse both the Parliament and the wider public. The Conservative motion attempts to conflate two or three distinct issues. Firstly the different tax rates in Scotland have raised more revenue than if we had left the rates the same as the UK. This was estimated at 240 million in 2018-19 so there has been real extra money to spend on health and other priorities. Secondly, Scottish earnings and therefore Scottish tax receipts have not been growing as fast as UK earnings and taxes and I think that we are all agreed on that. Now there are a number of reasons for this including the decline in oil and gas in the north-east of Scotland where there have been higher earners and taxpayers. Secondly the inability of most parts of the UK including Scotland to compete in the west as our Lib Dem friends have left but as Vince Cable said in 2013 London is like a black hole draining the life out of the rest of the country. Of course, sorry, give way, yes. Daniel Johnson. I'm grateful and he's right on the detail but that doesn't explain why every single Scottish region was underperforming the UK average. That surely is cause for concern and isn't entirely explained John Mason. I think he's choosing as to which figures he looks at because I think if we look at the longer term certainly since I've been in the Scottish Parliament the picture does change from year to year but on the whole Scotland compares very favourably with most English regions with the exception of London and the south-east and the example's already been given by one of my colleagues that when the figures were published recently on international inward investment they were doing very well. Third, the question with implied by the Tory motion as to whether we would have had more income for the Scottish budget if income tax had not been devolved at all. If that was the case then it would show us that the current financial and fiscal arrangements within the UK Government and the Scottish Government are deeply flawed which is a quote from the SNP amendment because none of that is to say because what that implies is that the fiscal framework is deeply flawed and needs to be looked at as soon as we possibly can. So none of what I've said is to say that the Scottish Government or we as the Parliament should not be taking responsibility for what we can control and of course we should be seeking to grow the economy and increase productivity and achieve increasing tax revenues but it does mean we have to be honest and realistic about what we can and cannot do under the present fiscal framework and it does seem to me at least that changes to that fiscal framework do need to be made as soon as possible but going back to the wording of the Conservative motion I do find it somewhat ironic that Conservative members frequently stand up in this chamber and make points of order about the accuracy of government answers yet when they produce a motion themselves it seems to me it is clearly intended to mislead. As we move on to the content of the resource spending review itself I do very much agree that our focus should be on the neediest in our society and therefore it makes sense to protect social security spending even if it is clearly disappointing that we're going to have to make savings in other areas however as the cabinet secretary has said we cannot prioritise everything just this week we had if it's brief Liam Kerr MP is going to be cutting budgets for local government for prisons, for universities, for rural affairs by about 8 per cent over the next four years whilst putting £20 million on the NDRF2 can we take that as a sign of where the member's priorities lie? John Mason I think frankly that £20 million would not make much of an impact on the police or on local government or on a number of other issues and I will touch on that later if I've got time but I don't want to mention that again as I think has been mentioned already the Glasgow centre for population health report which talks about life expectancy in Scotland between 1995 and 2019 whereas from up to 2009 there was a general increase in life expectancy healthy life expectancy for males and females from 2011 to 2019 there's been a decrease of two years across the board and a greater decrease of 3.5 years in the 20 per cent most deprived areas must focus on the poorest people in this country just to finish then on the inconsistency in the Labour amendment because they called for long-term growth but one of the areas where we could get long-term growth by being independent like other smaller countries they are refusing to accept so I think that is totally inconsistent and hypocritical so therefore I do hope that the opposition parties will engage in an adult way by all means give us their priorities but we can't have everything thank you I call Katie Clark to be followed by Jim Fairlie thank you very much and I warmly welcome this debate and the opportunity to consider the significant announcements that were made last week and of course we've heard from many members about the backdrop to this discussion across the UK we have standards rising food and fuel prices rising inflation and of course as been said Brexit, the pandemic itself and Ukraine make the economic situation more challenging however as has also been said there do seem to be specific issues in Scotland around poor productivity and earnings growth we know that the growth forecasts are poor and what we're facing clearly with the announcements that were made last week are significant cuts in budgets for many sectors that the Scottish Government is responsible for I'm going to focus mainly in my speech on the impact that that will have local government obviously is in area with an approximate at 7% cut that is going to be significantly affected and Unison's Scottish Secretary Tracy Dialing said that the announcements last week were a desperate day for public services that will have catastrophic consequences for Scotland's community I would however like to specifically focus on one sector where I think the impact of the cuts are going to be disastrous and that's the justice sector which is already in crisis before the pandemic there were approximately 13,400 Sheriff Court trials outstanding but as the criminal justice committee earlier this year indicated there are now approximately 32,400 cases outstanding in the Sheriff Court and we're seeing very significant real terms cuts proposed in the announcements last week of at least 20% over the next few years the Crown Office and Procreative Fiscal Service are having their budgets frozen at £170 million per year until 2026 2027 Community Justice is frozen at £47 million per year again until 2026 2027 The judiciary budget is frozen at £39 million per year again until 2026 2027 The legal aid budgets and police authority budgets also are frozen the prison service budget the Scottish Courts and Tribunals service budget and the Scottish Fire and Service budget and I fully appreciate the points that have been made that politics is about priorities and about choices but these real terms cuts are going to have very significant impacts on this sector which I see is already in crisis and a projected gap of it said in the region of £3.5 billion so I think these are issues that this chamber needs to be debating because they're going to have very significant impacts we know that there's a massive backrock in trials 43,606 as as February Scotland has the highest proportion of people in prison anywhere in Europe it's historically had very high percentages of people on remand and that's risen to 30% perhaps more during the pandemic and we also know that it costs £40,000 a year to keep a prisoner in prison so I think there's a very significant impacts and consequences of the types of cuts that were announced last week that this chamber needs to debate as I say I've focused on one sector but I know other sectors have similar stories of course it's been said that it's a matter of choices and the other sectors perhaps have done better in particular because of the challenge that we face in the health sector and the social security budgets and I really hope going forward we have a very serious debate about how we actually make the budget of the Scottish Parliament bigger and I do not think it's helpful particularly to focus specifically on independence in this debate today because you know there's many things that this Parliament can do within the powers that it has already we've heard already a number of speeches in relation to income tax we've heard my colleague Paul Sweeney talk about what could be done with district heating and indeed there's much that could be done in terms of municipal energy production that would significantly contribute the issues that we have before us today we need urgently to be looking at what we can do in terms of land taxes and we really need serious proposals for a land value tax including looking at what we can do to tax the profiteers such as Amazon who operate out of warehouses which could fall within land tax these are the kind of debates that we should be having in our chamber I will take an intervention and hopefully I'll get my time back I mentioned Amazon but that isn't tax over which we have power this is the whole problem for the Labour benches Katie Clark I think a land based tax is indeed lawful and indeed I hope that's a debate that we come back to and I look forward to debating the member on that specific issue in the future there are a number of reports that have indicated the types of taxes that are within the power the STUC in its joint report with the IPPR Scotland listed a number of reports areas that we could be looking at including local inheritance tax local payroll taxes fair work supplements and business taxes local income tax and carbon taxes I hope that in coming debates that the Scottish Government will seriously come forward with proposals as to how we meet these challenges which are going to be absolutely massive over the coming years thank you and I call Jim Fairlie to be followed by Ross Greer thank you very much there were two words that I didn't expect to hear very much of from the speeches and the Conservative benches today and those of course were the two bees that's Boris and Brexit two pretty big bees for anybody to deal with long and bungles Brexit meantime the disastrous consequences of Brexit are swept under the number 10 carpet alongside no doubt all the empty bottles and party hats but I'm afraid to say this that the office for budget responsibility is estimated last year that only two fifths of the Brexit damage had yet been inflicted it was the Tories who chose to give this debate the title economic priorities so let's look at some of the priorities and the choices that they have inspired where the UK Government has chosen not to cut universal credit the Scottish Government has increased the Scottish child payment where the UK Government continues to impose the bedroom tax the Scottish Government continues to protect people from it whereas the Tories want to ensure that no one in Scotland pays more income tax compared with people in the rest of the UK we in the SNP see the benefit in making progressive changes to the tax system so that those at the bottom pay less and yes those at the top pay a wee bit more but the Tories are quite happy to see that the UK Government is plundering Scotland's resources in the North Sea to make grand gestures across the UK so on the one hand we're having to use huge amounts of a limited budget to mitigate Tory policies and on the other hand the rest of the UK is benefiting from and are receiving the benefit of Scottish resources so where does that tell you about Scotland's place in this union of equals the picture on growth of course is not the same across all sectors I was reading just yesterday that the industrial sector in Scotland is not only exceeding growth expectations it is on track to achieve an annual turnover of £1.2 billion and over 4,000 jobs by 2025 which is way in excess of the initial targets of the national plan for an industrial biotechnology which were set at £900 million and a turnover of £2,500,000 employees by 2025 and of course I have spoken previously and often about the fantastic growth that has been over the years in the Scottish tourism and food and drink sectors and Tory's and areas like the renewable energy still have a massive potential my colleague Paul MacLennan talked about the growth commission but it's worth repeating that Ernst and Young's annual survey of foreign direct investment shows Scotland recorded a 14% increase in such projects in 2021 that's not a little better than the rest of the UK it is streets ahead this is a truly significant level investment compared to an increase in foreign direct investment of 1.8% across the rest of the UK and 5.4% across Europe so if you're wondering about growth figures this is exactly the sort of thing that is going to turn that situation around people want to invest in Scotland people want to do business in Scotland and according to Ernst Young's survey results Scotland's perceived attractiveness to investors now sits at a record high yes I'll take the intervention Douglas Lumsden talks about growth figures for specific sectors overall where Scotland the growth figure is almost half the rest of the UK the macroeconomics the names of macroeconomics sit with Westminster however going back to the pointers making this is no flash in the pan we have been the most successful nation or region in the UK outside of London for nine of the last 11 years and for the seventh year running and attracting foreign direct investment so why are we doing so well in that field the proactive work being done by the Scottish Government and offices various major European and world cities has had to play a large part in that now I'll give credit where credit is due that this programme of work that began before the evolution under a Tory Scottish office was continued through Labour Lib Dem Coalition days and it has truly flourished under the SNP so what is the modern day Tory response to that success story being Stephen Kerr decides to write to Dominic Rab bleeding about the waste and beseeching him to put the First Minister in her place and assure that we do not see any further additions to this network well let's say to Mr Kerr he better buckle up because we intend to go a lot faster not stop and that brings me neatly to the last part of the Tory motion we are debating to be today they want us to take plans for a second referendum off the table well I've got news for the Tory members it was the people of Scotland who put that on the table by electing a government a party who stood and decisively won the 2021 Scottish Parliamenter election and an explicit commitment in our manifesto for holding such a referendum so in terms of the overall referendum budget the amount that was put aside for the referendum is in relative relative terms tiny but what a powerful investment that tiny investment is going to prove to be the opportunity as a nation to give ourselves the ability to finally operate as a normal country to have the powers to really address the economic problems that we have doubtless to face and to encourage and to engage with other countries and build bridges rather than put all ourselves behind the false barricades that the UK has decided to do and to take responsibility for our own future that independence is priceless I call Ross Greer to be followed by Emma Roddick I'm grateful to Liz Smith for having given us the opportunity to discuss the resource spending review and the wider financial situation facing the Scottish Government and frustrated at how this afternoon's opportunity to discuss something so far reaching and serious is being wasted or has been wasted on what I can only describe as performative ignorance in some quarters a number of useful contributions have been made but alongside them we've had to hear what I can only assume are deliberate misunderstandings and I do hope they're deliberate of how devolved finance actually works and like at every budget demands for billions of pounds in extra spending or tax cuts without any explanation of how it will actually be paid for The first line of the Conservative motion is quite correct we're all concerned by some of the trends in our economy which are putting a squeeze on our public finances and by the significant decline in real earnings expected in the coming period but from there I can only characterise the Conservative motion and the comments they've made in the last week since the spending review was published as disingenuous particularly on the issue of income tax the deliberate conflation of two entirely separate issues the devolution of income tax and the fiscal framework under which that devolution has taken place and the separate issue of the rates and bans that we set it is entirely true not quite yet Mr Johnson it is quite true to say that devolution of income tax under the terms of the fiscal framework has been detrimental no one in this chamber argues that the fiscal framework is fit for purpose but it is disingenuous to imply that the progressive changes to income tax made in 2018 at the instigation of the Greens have somehow resulted in less money being raised as Mr Mason pointed out in firm figures the opposite was the case a quarter of a billion pounds was made available to our public services as a result of making our income tax rates more progressive but then on top of that the one key proposal the Conservatives seem to have is cutting tax particularly for higher earners meaning that we would have even less money for our public services the public services that they are complaining about spending reductions for Labour might demand higher spending without offering proposals for where that money should come from we do not demand that even less money be raised simultaneously to demanding that more money is spent you cannot argue for a low tax high spend position and expect it to be taken seriously it is disappointing though that Labour's amendment is only cosmetically different to the Conservative motion offering no substantial alternative proposal to the savings laid out in the spending review one point of agreement I will offer though is to reiterate my interest in exploring changes to the budget process potentially including the introduction of finance bills as I've said to Liz Smith previously I think that this would be an appropriate issue for Parliament's finance committee to consider building on the work that it's done in recent years to improve the budget process it bears repeating though that the Scottish Government has a fixed budget it cannot overspend nor can it meaningfully borrow Daniel Johnson I thank the member for giving me but in the interest of accuracy would he acknowledge at the very least that the budget is not entirely fixed the Government has spent comes directly from taxes that it sets here in Scotland Ross Greer I thank Mr Johnson for that intervention and I only wish that the Labour Party would table a single proposal on any of the five core devolved taxes that we have that could be considered a budget time because the Labour Party quite rightly want huge increases in public spending on a range of issues I completely agree with them on but have not yet once in any of the six years of budgets that I can remember proposed how they would actually pay for that even the modest borrowing powers are restricted to correcting forecasting error and that is arbitrarily capped both the overall sum of the Scottish Government's reserve and the amount that can be drawn down in any individual year from that reserve are also arbitrarily capped there are universities in Scotland with larger reserves than what the Scottish Government is even allowed to hold and as all of these caps were set in cash terms rather than as a proportion of the overall budget their value in real terms is far smaller than when the fiscal framework was agreed add to that the real terms erosion of the settlement by a 9% inflation rate and the fact that the UK Government cut the Scottish budget by 5.2% this year and it's quite clear why the numbers look the way they do the most notable spending pressure on social security is an example of Scottish Government's success not failure establishing the Scottish child payment raising it to £20 and then to £25 is a game changing achievement this will be a lifeline to so many low income families though sadly for many it will now act largely as mitigation against the UK Government's cuts to universal credit rather than something which sits on top of UC to genuinely boost family incomes enough to lift them out of poverty Conservative MSPs want to talk about Government waste and avoidable spending but not one can defend Westminster policies from the bedroom tax to the benefit cap to universal credit cut which the Scottish Government then has to spend hundreds of millions of pounds simply mitigating that is absolutely the right thing to do but imagine how much more Scotland could do if so much public money was not constantly spent limiting the damage caused by a Government that this country did not actually vote for if the UK Government was to take a more humane approach or even a less nakedly inhumane one not only would it provide some desperately needed relief to people across the UK it would be a huge benefit to Scotland's public finances even an uprating of their own social security payments in line with inflation would be hugely helpful on both counts alongside the commitment to protect the most progressive package of social security anywhere on these islands this spending review ensures the Scottish Government is able to deliver on its commitments to tackle the climate emergency we have an overriding moral obligation to play our part in reaching net zero for those already suffering the devastating effects of climate breakdown and for future generations but the economic benefits and the return on public investment here is massive the £1.8 billion heat and building strategy for energy efficiency for example will deliver thousands if not tens of thousands of jobs in home energy installation heat pump installation and other sectors those decent paying jobs will contribute to families raising new revenue through tax and if the training and skills opportunities are delivered correctly they will lift families out of poverty through secure employment no-one is pretending that the financial context of this spending review is a good one but given the absurdly tight room for manoeuvre it has the Scottish Government has rightly prioritised efforts to tackle child poverty and the climate crisis if Labour and the Tories have serious alternatives they should have put those forward because today's motion and amendment look like they haven't even read the Scotland Act thank you I call Emma Roddick to be followed by Jamie Halcro Johnston thank you, Presiding Officer I've heard quite a lot today from the Tories complaining that our priorities are wrong the SNP Government's priorities are clear tackling the cost of living crisis tackling child poverty and tackling the climate crisis whether the Tories like it or not people voted for those priorities they voted for the party offering to direct the spending towards tackling poverty it's been 20 seconds but okay Douglas Lumsden you have to get started oh just to clean Emma any bother not worth waiting for I thank the member for taking an invention sorry about that do you not think that one of the key priorities should be to prevent poverty and how is that achievable when there's cuts to local government cuts to enterprise cuts to the university colleges budget Emma Roddick I'm really glad the member raised that because I am going to come on very shortly to how exactly the Scottish Government is doing that despite what his party has inflicted on this country whether the Tories like it or not people voted for these priorities and they were not impressed what the Tories played for so-called economic growth to be the priority particularly as we all saw what conservative led economic growth actually means during Covid it meant that the rich got richer and the poorer got poorer it is no surprise that they're here today arguing for tax breaks for those on the highest wages it meant public contracts awarded to friends of friends and employers rewarded for having terrible sick pay policies and unfair contracts it meant billions in unjustified spending directed to grow specific pots of money not in the public interest but in private interests Liz Smith complained in her opening speech about shortfalls and I do want to address one of the reasons the Scottish Government doesn't have as much money as it would like to spend the Scottish Government is having to spend more than £770 million this year alone to mitigate the impact of harmful Tory UK policies that Scotland did not vote for that includes the bedroom tax it includes the cutting of benefits for those already worst off and the cap on the number of children the Tories are willing to ensure people have enough money to clothe and feed that's not right, it's not sensible and you would think it's indefensible but here the Tories are today trying to defend it anyway using the fact that managing Scotland's finances is a huge challenge within this union as an argument for staying in the union is like saying you're not going to take medication because your conditions getting worse there is a fix here for being able to borrow, being able to invest more productively, being able to make wider decisions about budgeting and it's certainly not remaining tied to a UK Government with fundamentally opposing political ideologies and priorities to our own who's shown no signs of giving us these powers if we hang around the answer is independence and I'll take another intervention Craig Hoy I thank the member for giving away could she say in what way a policy of sterlingisation would allow Scotland to borrow and to frame its own affairs Emerotic Michelle Thompson spoke earlier to a lack of morality and this is the perfect demonstration I'm not interested in endless economic growth for the few what I'm interested in is making sure that the standard of living is not at the lowest that it has been since records began speaking of which for a party that insists chat about independence is a waste of time it is incredible how often the Tories managed to work it into debates no matter what the SNP no matter what the SNP says or does not say the Conservatives will continue to bang on about independence I remember their 2017 and their 2022 council campaigns it was independence independence Thank you I would like to hear Ms Roddick their council administrations are farmed based on independence and their party name has unionist in it the Tories call supporting independence divisive that is misleading it is one answer to a question that hasn't been answered yet that's why we're still discussing it public opinion is split opposing it is just as divisive as supporting it the Tories cannot pretend that their view on the matter is the one that has consensus so let's consider just for a moment that Scotland were independent right now and we were sitting in this chamber looking at Brexit looking at Covid shambles looking at a country run by a Prime Minister who doesn't have the confidence of the public or even as many of his own MPs as Margaret Thatcher did and the Tories brought a motion asking this Parliament to agree that we should join that union would we think it sounded like a good idea because I don't think so we've already heard that the Scottish Government has no control over UK Government spending decisions and no control then over what it gets from the block grant perhaps more important to note is that the people of Scotland have no control over the UK Government spending decisions the election of the last Labour Government is a distant childhood memory for me but the country I've grown up in has not voted Tory in any of the election since Scotland isn't voting for tax breaks for the rich it is not voting for Tory Governments the Tories can win that not pandering to their calls for those things here and instead calling for decisions that must be made by us is undemocratic in some way but that's blatant nonsense they just can't remember what democracy looks like Presiding Officer it is clear that the Tories and the Scottish Government do have different priorities they favour what they call economic growth to tackling inequality but they cannot be surprised when I and others stand up and call that out for what it means it means abandoning the most vulnerable to the sharpest fall in living standards when the Tories began in the name of funneling more money to their pals thank you thank you thank you I'd first like to echo the sentiments of my colleague Liz Smith in introducing today's debate last week we saw a major announcement on Scotland's public finances made by the cabinet secretary in this chamber but just 30 minutes of parliamentary time was given for her that's not treating the Scottish Parliament with respect and it's not giving even basic recognition to accountability and it's one reason why the Scottish Conservatives brought this forward to this debate today the resource spending review and the associated outlook provided by the Scottish fiscal commission has been a wake-up call more than ever it will be a battle of priorities that shapes Scotland's immediate future but the decisions we make now will impact on how we rebuild economy after the unprecedented economic shock which is why we should look with real concern at where the axes to fall the IFS noted these areas will suffer with significant real-term cuts their local government, the police, prisons universities and rural affairs but with cuts of around 16% in real terms the enterprise tourism and trade portfolio will be hit even harder than most it seems an unusual position when we are lagging behind the rest of the UK in growth and productivity to see our enterprise budget slashed in this way we should ask if this government has come to terms with the devolution of tax powers and the creation of the fiscal framework no longer is the economy in any sense someone else's problem as long as SNP Green administrators seem content with lagging behind the rest of the UK remaining stubbornly inattentive to the needs of business and apparently untroubled by being outpaced we will see continued pressure on our finances in March we were presented with a national strategy for economic transformation a lightweight document which should not live up to its name but what now for the delivery of even the most modest goals of that strategy when enterprise bodies are being cut to the bone and sadly the approach the Scottish government has taken will not harm only itself it will impact yet further on local government where councils have already been forced for too many years to do more with less one of their core functions is of course the provision of schools and there can be little doubt that the spending review has thrown out education as a priority but at the most fundamental level it is galling to see the Scottish government rankle at the highest core block grant from the UK government in its history while passing on swinging cuts to people's local councils and that is particularly the case in my own region the highlands and islands where local bodies have a far greater ability to be responsive to local needs and to deliver effective change on the ground however their services seem undervalued by government Edinburgh that only seeks to centralise authority but what of the Scottish government's own stewardship of its finances in last week's quick question slot I asked the finance secretary about wasting government projects to tell us we are facing a tough economic outlook down the road is one thing but to do it while her government waste hundreds of millions of pounds of taxpayers' money on unfinished ferries and on other failed or failing projects is quite another the Scottish government will be aware of the catalogue of weaknesses identified by what it's Scotland amongst others this is not something that can be branded with Covid or Brexit these are homegrown calamities with the Scottish government's logo firmly painted on the side and it's time for SNP and Green Ministers to move beyond the excuse that these things happen they must set out concrete proposals for getting value for money from public spending because the alternative is precisely the sort of cutbacks that Kate Forbes has set out gone already it seems are the long term strategies that could make a difference to people's lives reducing the attainment gap boosting productivity to at least UK average levels fighting health inequalities instead this is a spending review that does little to actually review the funding instead it tries to maintain vanity projects while cutting back core budgets and it lets short term firefighting replace reform and improvements in public services it's also an arrangement that hits our constituents hard in the pocket unless action is taken the gulf between the tax people in the Scotland pay and the tax people in the rest of the United Kingdom pay is going to grow even wider still and what have we gained from this situation a taxation system which hammers earners one that was projected to raise an additional half a billion pounds in revenue but which actually loses us 170 million because of a lack of growth in the tax base and the government benches can spare at any nonsense about the 19p tax ban they created it was a fiddle entirely confected to create rebuttal points a measure that can save taxpayer an absolute maximum of 42 pence per week presiding officer if we take any lessons from the resource spending review that we cannot go on with a Scottish Government that confuses suffering with solidarity and action with achievement in some ways I welcome the finance secretary's belated conversion to economic reality because for too long this SNP led administration has played the support of internet interest groups while seeing Scotland's public services suffer but in times like this we see where a Government's real priorities lie and where choices can make a difference sadly in this case the Scottish Government has made choices that will have a devastating impact across the leganth and breadth of this country thank you thank you and I call Christine Grahame the final speaker in the open debate thank you very much presiding officer reading the Tory motion and the Labour amendment I have to wonder what plan indeed what UK they live in indeed some speeches remind me of Groundhog Day 2014 better together when Scots were told vote yes and you'll be thrown out of the EU while we all know what happened after that we're out to state the obvious this Government depends almost entirely for its spending person the Barnett formula and any consequentials flowing from what UK Government additionally spends on its domestic responsibilities our tax-raising powers are limited and most pay less tax in Scotland and England we all of course however pay extra UK national insurance which is a tax and those in universal credit have lost out the £40 per week delivered during Covid most of those people are working references being made to the Scottish fiscal commission rightly so but not the fact that it has independently verified that our budget has decreased by 5.2% in real terms between 2021-22 and 2022-22 let me make some progress then yes and that the Scottish fiscal commission has also confirmed a further 1% real terms reduction 2025-26 we are and will remain at the economic mercy of the UK Government until such time as we are independent of it, yes I'm grateful to Christine Grahame for giving way I'm not sure of which newspapers she reads but Brian Wilson in his Scotsman column last Saturday said that the SNP should check their own graph and he referred us to the Scottish Government core resource and Covid-19 funding in real terms and when she talks about this 5.2% cut she fails to mention that we have the highest block grant that she had in history she fails to recognise that that will be increasing in real terms for this Parliament she fails to recognise that the finance secretary has £7 billion more than she was forecasting four years ago so can she explain all that Christine Grahame first of all I recognise an interventional issue and that was a speech and I take no lessons and the Tories are desperate to pray him in aid further we have had two years of Covid years of post Brexit not included and certainly not of and ready the impact of the war in Ukraine and inflation set to rise to 10% with desperate and destructive cost of living and energy prices and I repeat the UK currently has the highest inflation of any G7 country almost twice the rate of France I notice the Conservatives dance around that but who do they attack they attack the independent governor of the Bank of England criticised for claiming the bank had quotes and fallen asleep at the wheel regarding inflation to which Mr Bailey rightly said there's a lot of uncertainty around this situation and that is a major major worry and it's not just that I have to tell you a major worry for this country there's a major worry for the developing world as well and so if I had to sort of sorry for being apocalyptic for a moment that is a major concern apocalyptic from the Governor of the Bank of England now the increase in food and energy prices doesn't just impact on individuals and families but the cost of manufacturing running our schools and hospitals even filling the ambulance diesel tanks bills which will land at the feet of this government it's as plain as a pike staff that we face the same economic challenges as other nations worldwide except we don't control the macroeconomy all the other tax-raising powers companies tax inheritance tax, VAT, fuel duty and so on despite that to protect the most vulnerable we have commendable social policies we make choices to P5 free prescripts and no tuition fees free travel for all under 22s over 60s in certain disabled and so on that is not the complete list add to that the 770 million already reference to mitigate that word I hate mitigate Tory policies and to Liz Smith waste this is the waste of the UK government festival of Brexit 120 million tracking trace by the public accounts committee at Westminster HS2 112 billion at least ferries that didn't exist ordered by Chris Grayling 81 million Nimrods oh I've more to come Nimrods oh you don't want to hear it perhaps you should listen Nimrods 9 scrapped in 2011 4.2 billion in the garden bridge while mayor 43 million and never built Crossrail cost 4 billion above its 14.8 billion budget PPE contracts to cronies there's a great big list policies I may add and an economic tsunami which Scotland did not vote for six Tory MPs in Scotland with only four wanting to toss Boris out or is it three and a half with Douglas Ross I think he could give Kamasutra a run for his money of the UK government's man in Scotland we would expect nothing less of Uber loyalist Alasdair Jack who I'm sure is expecting a comfy seat in the best special retirement home the house of lords so here's my message to Boris as he clings by his free fingernails to the door handle of number 10 grab that section 30 for that legally binding referendum after all with your government's track record a victory for the union should be a skoosh go for it Boris otherwise we'll know you fear yet another unhappy result independence I say to Katie Clark is not an end in itself but the right to tax fairly to deliver a socially just society and it's time Labour woke up to that thank you we move to winding up the speeches and I call on Daniel Johnson thank you Presiding Officer though I think I need a moment to gather myself I'll expunge the picture of Douglas Ross and the Kamasutra if the member will forgive me but the spending review and the fiscal commission's forecast make three things brutally clear first of all the Scottish economy under SNP management has underperformed not just its long term performance but underperformed the UK average it would be bad enough if that was just meant that Scottish workers were earning less and had fewer job opportunities than they should but it's even worse because income tax devolution means that there are hundreds of million pounds less to spend on frontline public services than if income tax had not been devolved at all 400 million less for next year alone second after 15 years in charge the SNP have suddenly woken up to the need for public service reform and modernisation except they've left it so late that there's no vision or strategy as to how the apparent efficiencies will be made just four vague references to shared services and reforms it all sounds very similar to things being proposed than in Westminster by the Tories that they're so quick to criticise the cabinet secretary indeed has used the word reset endlessly in recent days but every time she says it she means cutting jobs cutting public services and passing the buck yet again to local councils to make those cuts thirdly and make no mistake the spending review does mean cuts deep cuts to critical services 7 per cent cuts over five years to local services so it is inevitable that class sizes will rise local roads will deteriorate parks will be left to rust and libraries will close and it's not just councils taking the brunt of these cuts our colleges, our universities will see resources slashed which means that we won't have the ability to grow the skills that is so clear from the data that our economy needs now if the SNP are saying that health jobs will be protected then it is ultimately abundantly clear as Douglas Lumsden was pointing out in his speech that that means huge cuts to the rest half of the job increases through the Covid period have been in the health service so if those cuts are to be made in other places in the health service that means up to 8,000 job losses from central government that's a third, one in 20 jobs in local government at risk so while they've been quick to criticise the Tories and rightly criticise the Tories for austerity that comprehensive spending review is nothing short of that same austerity being needed out to Scottish jobs and Scottish services up and down this country now there's been much talk about independence from the SNP benches and they are absolutely within their right to argue their opinions about what it may or may not deliver although I would urge them to read the growth commission and ask them what would the moment public service spending to half that of economic growth really do to public spending and while they may be entitled to their opinion on independence they are not entitled to their own facts and the facts are very straight forward since 2016 average wages in Scotland have been not just well below the UK average they've been below Northern Ireland they've been below Wales apart from East Scotland so places like Manchester and Cumbria if you can answer me why average wages are so far below UK average wages since 2016 I thank you very much for taking the intervention what I'll point out to Douglas Daniel my apologies Daniel is that would you recognise as an independent Scotland we would have a much different position because the Norwegian wealth fund is 2.1 2.1 million pounds to each and every Norwegian citizen so does the member not agree that there has been a massive wasted opportunity for the people of Scotland? Daniel Johnson the oil's gone if he had a time machine that argument might be relevant but we're in 2021 and we have to face facts to date and the other facts that we have to face and Michelle Thompson is right microeconomic policy and microeconomic policy and she is correct that largely microeconomic policy rests with the UK Government but microeconomic policy does rest with the Scottish Government we have control over skills over enterprise support and regional economic development and in past decades that has seen Scotland do very well it's seen Scotland have productivity growth higher than the UK average so why is it then with those levers that have been demonstrated to work have those levers been failing to work in the last decade because that is the reality SNP members are absolutely right to point out to the dreadful context that the UK finds itself but they cannot explain why we are against a obviously and in their own words a dreadful and incompetent Government they're not able to do at least a bit better than that they need to explain why against that context we're doing worse than the UK average rather than better if we have those levers surely we should be able to beat the UK average in terms of skills growth in terms of enterprise support instead we have the highest spend on enterprise support and the lowest levels of productivity growth across the UK so in closing Presiding Officer the the spending review is very clear what the Scottish Government priorities are they're to find money for another divisive independence referendum while cutting and slashing spend elsewhere and they quite frankly are completely devoid of any answers as to why they have been utterly incapable of using the levers at their disposal to grow Scottish incomes to grow Scottish investment and quite frankly leaving Scots the highest level of tax across the UK following the introduction of the 19 pence while receiving less for it than they would have done prior to income tax devolution that is a fact that frankly few Scots should ever forgive them for thank you and I call on Tom Arthur thank you Presiding Officer and I'm grateful to members across the chamber for their contribution and also for the revelation from Daniel Johnson that the oil is gone funny that when the price of oil goes up we always start to hear an increase in calls and sayings that the oil is gone isn't that funny the reality is that oil still has an important part to play for the future of the north feast and we are committed to supporting the north feast and a just transition but let me move to some points of consensus Liz Smith said two things she said that this is a time of challenging economic circumstances and I think we have to be very realistic about that the position we find ourselves in here in Scotland across the UK in the wider world we are not unique, we are all wrestling with feast challenges but Liz Smith also said that Scotland has immense talent in every corner of the country and while we have a job to do to debate constructively and with passion about what we think needs to change to harness that we must make sure in doing so that we never risk even inadvertently talking down the huge potential of our country and also means recognising that talent has also been able to have constructive engagement across these islands and it also means being able to point out where for example the UK Government gets things wrong for example on the subject of a just transition with Acorn, yes I will take the intervention from the member Daniel Johnson I thank the minister for taking the intervention and on that point I agree with him we have huge potential but can we actually maximise on that potential when we are cutting three of the four budget lines which are relevant to developing skills in Scotland Minister This is a central point and it's a point that Michael Marra spoke about passionately and advocating for education I pointed out that Katie Clark spoke about passionately with regards to the justice portfolio but fundamental in this RSR we are having to make decisions and the fundamental reality of that is there is opportunity cost but I would say recognise the money that is being invested in employability and also as has been quoted by other members which is a reflection of that talented workforce that we have across Scotland and we should not forget that Now another point that I want to just to pick up on and it's a technical point but it's an important point of process but Liz Smith raised in Ross Greer and that was about the finance bill I would just want to remind the chamber and inform the chamber that we are working to re-establish the devolved taxis working group that is an important piece of work and it is important to recognise that devolution of taxation is a process, it's not an event and I think we need to be ensuring in debates like this we do allow some time for that detail technical consideration of these matters certainly I'm very grateful to him for mentioning that point can I just confirm that possibility of a finance bill is actually within the discussions because it is something that I think in terms of audit Scotland's remarks would be very welcome across all the political parties in this chamber Minister? Yes, that is something that can will be discussed as part of that I would not want to pre-empt what the outcome would be Now I'm going to turn to the remarks of Paul when he spoke about some of the causes of where we are just now and he mentioned Brexit and he mentioned Covid, both proximate causes but we are still living with the legacy of 2007-2008 there's been a number of people who have mentioned in this debate that this government came to power 15 years ago it was by coincidence and this government came to power just as those teaser rates started to end in sub-prime mortgages across the United States precipitating the global calamity that we faced and I would recognise the fact that there's an accountability for all parties that were in power in the period up to there but we are still living with the reality of that, with Verizon Poverty and it was disappointing in Alex Cole-Hamilton's contribution that he did not recognise the contributing fact that austerity had and we are still living with to this day and that was ultimately a policy decision that his party in government supported and I think that that is something that has to be recognised we are coming back to that fundamental question of choices, Douglas firms has spoke with passion about local government I recognise his interest in this as a former councillor but when I put the question to him what quantum does he want to see allocated to local government he did not respond and this is the question that we have to grapple with if we are going to increase one budget line it means decreasing another we have taken a clear choice around our priorities on tackling child poverty on a just transition and we have put our money where our mouth is with regards to the social security lines now if members want to go and see increased budgets in other areas then it's incumbent upon them to say where that should come from we are not in a position where we are having a question and answer session or a debate at stage one of the budget process we are six months out from the budget and the broad framework and the parameters so there is an opportunity to be on this debate for members across the chamber to reflect on what they want to see in that budget come December and if members do want to see increased lines elsewhere then it is incumbent upon them as responsible parliamentarians to say where that should come from now Michelle Thompson raised another very important point in this debate and this was a bit insufficient in borrowing powers and this speaks more broadly to the issue of the operation of the fiscal framework we do have to get some facts to it here our devolved taxes are raising more revenue the issue that members are referring to in John Mason made the point about the fact that issues are being conflated it is the operation of the fiscal framework and I would hope we can be united across the chamber in wanting to see revisions to the fiscal framework which address some of these key points but also give us those additional borrowing powers and indeed expanding the powers with regards to the reserve to allow us to more reasonably manage the volatility that any Government will face in any particular set of circumstances but particular now Alexander Stewart spoke about hardworking families paying more hardworking families are paying more they are paying more for food they are paying more for energy they are paying more for a range of household goods that is the reality of it but I will say whether they are not paying more this is where the counterfactual comes in whether it is the Tories from power they are not paying for prescription charges which is the reality for people south of the border and the reality is that we were to follow the Conservative Party's policy of a £500 million tax cut for the best paid in society a time of a cost of living crisis frankly I think most people would look at that as a dereliction of duty I'm afraid I don't have time I have to conclude Fundamentally this resource spending review is about choices Adam Smith was mentioned a couple of times in this debate and I want to quote something from me biographer of Adam Smith The Government seems to lack a sense of mission it has a large majority but no long term plan there is no sign for example that it has even begun to get to grips with the need for greater security and resilience in a range of policy areas that is the former financial secretary to the treasurer in Tory MP Jesse Norman talking about the UK Government chaotic lacking decision lacking vision in contrast this Government does have purpose a mission reducing child poverty tackling the climate emergency and that is exactly what this resource spending review will deliver Thank you I call on Murdo Fraser to wind up the debate Thank you it's my pleasure to reply to the debate on behalf of the Scottish Conservatives I think it's been a very helpful and valuable debate in fact it may be one of the most important debates we're going to have in this chamber for a long time because the medium term financial strategy set out by the finance secretary last week sets the trend for government spending for the next four years and I think it's disappointing frankly that having had just a half hour statement on this last week it was left to the opposition party to take this debate this afternoon of course Cabinet secretary that sets the timing considering every Conservative has raised this in the debate this afternoon can he accept that it's incumbent on his chief whip to make that point in Bureau Surely it's up to the Government of the day to bring to the chamber enough time to debate what could be the most important set of issues facing this Parliament over the next four years but we learned quite a lot in this debate we learned first of all that the SNP don't like the term black hole so what do we call it perhaps we should call it a mismatch a mismatch between the money coming in and the money that's going out and this black hole the situation that's mismatch is one that is entirely of the SNP's own making no matter how much they try to deflect away and all the SNP speeches this afternoon were all characterised by deflection it was all about trying to point it is down to them we heard and I'm very disappointed in the finance secretary because we heard her once again put forward this claim that there would be a 5.2% cut in the Scottish Government's budget she knows that's a dishonest claim because that is not comparing like with like she knows, I'll give away in a second she knows perfectly well that the budget for the previous year was inflated because of one-off Covid money and if you take that money out this budget here is the highest it has ever been I'll give away again if he calls me dishonest on that statement he must also call the SFC dishonest because I'm quoting directly from the Scottish Fiscal Commission Murdo Fraser what the cabinet secretary is not doing is taking account the one-off Covid money that was in the budget for last year the reality is the core budget is up the block grant is up £4 billion on last year 10% in cash terms 10% in real terms the biggest block grant in the history of devolution and also we know because the cabinet secretary said in her statement last week that the budget for this year is £7 billion higher than was being expected back in 2018 at the time of her predecessor Derek Mackay's last medium term financial strategy in 2018 he was predicting a budget £7 billion lower than she has in her budget for this year and that's thanks to the UK Government providing more money in its block grant to support devolved spending in Scotland and yet what do we see? we see cuts right across the board sorry Michelle Thompson Michelle Thompson thank you for giving way in that point I suppose I continue to wonder when I was growing up Scottish Conservatives would talk often about taking accountability and responsibility for creating their own future why is it uniquely now that the best hope for is going cap in hand to Boris Johnson and asking for more money rather than creating a better future what on earth happened to the Tories? Murdo Fraser that's a brilliantly timed intervention but I'll go on to talk precisely about what the SNP have done with the devolved tax powers the extensive devolved tax powers that they have and we know that tax receipts are not performing as well as hope the SNP's tax changes are bringing 700,000 more Scots into the 41% higher tax rate making us the highest tax part of the United Kingdom but we also know, as we've heard in this debate that income tax receipts are £400 million less than would have been the case under the old system now this is the party that wanted fiscal devolution this is the party that signed up to the Smith commission John Swinney sat on the Smith commission and they've left us in a worse position as a result John Mason said that the fiscal framework was deeply flawed but why did you sign up to it Mr Mason knew in your party if it's deeply flawed and Mr Arthur was similarly disparaging this is the party that calls again and again and again for more economic and fiscal levers but when it gets levers and it pulls them it leaves us poorer and worse off I'll give way and a serious point it was agreed by both the UK Government and the Scottish Government that there should be a review of the fiscal framework which recognised that it would be a learning process does the member not concede that point Murdo Fraser well of course but you might have thought given that Mr Mason said it's fatally flawed fundamentally flawed if it's that bad why would you sign up to it in the first place we now have to live with the consequences of what we've seen in terms of tax revenues and the block grant and the consequences will be that there will have to be real savings made in public spending whole swathes of departments including justice education, universities and local governments will see real terms cuts of 8% over the next four years for enterprise, trade promotion and tourism the outlook is even more grim cuts of 16% in real terms and as Jamie Halcro Johnson reminded us some of the acts falls in the very areas where we would expect to see investment to deliver a faster growing economy such as universities tourism are on trade and yet these will see the biggest reductions in spending Michael Marra made a very fair point about the importance of education not only as important in its own right but as a driver for economic success and yet education is being cut under this budget too Stuart McMillan in his intervention earlier talked about the jobs that have been saved at Ferguson marine what he didn't say is that it's been estimated that up to 40,000 jobs could be lost under the spending review that we've seen announced although ministers are claiming no compulsory redundancies there's even been suggestions that the public sector could move to a four day week but get their salaries cut by 70% as a consequence there's been a few raised reactions from the trade unions with unison threatening strike action if the Scottish Government doesn't rethink its plans and as we heard from Douglas Lumsden and Alexander Stewart local councils will be the hardest hit vital services such as bin collections and libraries under more pressure than ever before it shouldn't surprise us the SNP Government waited until after the local elections before announcing these plans so that the different outcome the voters have known what was coming down the track for them at that particular point we also see cuts in the capital budget so we see that motorways and trunk road spending being cut for £411 million this year to £377 million in 2025-26 my constituents are concerned about the impact, I'm sure that Kate Forbes are too what impact that might have on the A9 dueling project already many years behind schedule we don't know what's going to come of that too and yet they're still in spite of all these cuts plenty of money for the SNP's pet projects £20 million being ring-fenced for a divisive independence referendum in 2023 despite everyone knowing that simply not going to happen and it says all we need to know about priorities of this SNP Government that they would divert precious resources to another unwanted referendum rather than support our courts our universities our parties or our local council Scotland undoubtedly needs a different approach we would want to see a renewed focus on growing the economy at least in line with the UK average and that would increase tax revenues to fund local services cos these are so important Michelle Thompson in our contribution earlier was asking about why the Scottish economy isn't growing any faster and we've pointed out we're not even matching average UK economic growth that's not an issue about macroeconomics it's an issue about this Government using the powers it has at its disposal to help grow the economy and there needs to be a better understanding that unless our private sector businesses thrive our economy won't progress that means tackling the productivity puzzle with a laser-like focus and there needs to be constitutional stability not the endless threat of another referendum to conclude the horrendous situation the Scottish public finances now face is not the fault of Westminster it is entirely down to the actions of this SNP Government for years they've railed against so-called Tory austerity now we have a made in Scotland SNP austerity and they have simply no one else to blame for their point made in the motion by my colleague Liz Smith which I'm delighted to support that concludes the debate on economic priorities it's now time to move on to the next item of business which is consideration of business motion 4839 in the name of George Adam on behalf of Parliamentary Bureau setting out a business programme and I call on George Adam to move the motion thank you minister no member has asked to speak on the motion therefore the question is that motion 4839 be agreed are we all agreed the motion is therefore agreed the next item of business is consideration of Parliamentary Bureau motion 4842 on approval of SSI and I ask George Adam on behalf of Parliamentary Bureau to move the motion moved minister and I call on Michael Marra thank you for your opportunity to speak on the issue of SSI and cross border placements for children this morning MSPs received representation from Scotland's children's and young people's commissioner asking that we consider our decision on this issue in light of our obligations as human rights guarantor for all children in Scotland the commissioner lays out a set of issues pertaining to the regulations which deserve the attention of Parliament colleagues on the education children and young people's committee heard evidence from the office of the commissioner as well as from the minister and our officials on this issue and we should be clear and I know that the minister has reflected this in her work on this issue that we must not let the perfect be the enemy of the good in regards to the welfare of children in England and Wales for whom appropriate care placements are unavailable closer to home these are and must be temporary measures Labour will support the SSI on that basis but the situation Parliament finds itself in is unacceptable the incorporation of UNCRC which could have been done many months ago and that is the situation of the Government's own making firstly I would ask the minister to give assurances to the chamber that the range of issues pertaining to the welfare of these young people raised by the commissioner are being taken on board by the Government can she now give assurances that these issues will be dealt with in the fullest degree possible in accompanying guidance for statutory bodies who must deal with these cross-border placements secondly these placements are required because the situation in England in Wales is one of disarray we must also be clear that Scottish facilities are reliant on the funding that follows these placements in order to keep the likes on all is not well in our own sector far from it I asked the minister on 25 May in committee for assurances that full funding for Scottish placements will be made available from the Government as an integral part of the children's care and justice bill she said in response we need to think about how we can assist that service to be economically viable I would ask her to elaborate on those issues to the chamber today the current situation in Scotland is unsustainable and risks appropriate provision thirdly and finally the children's care and justice bill is promised as the long-term fix for these temporary measures we still have no date for the introduction of the legislation and I would ask the minister to provide a firm date I'm happy to do so I'm very grateful indeed to Mike Marra for giving away before he concludes remarks which I wholeheartedly agree with the right guarantors this Parliament has a duty to make sure that we don't render a sort of second class of looked after young person as the children's commissioner warns might happen as a result of this Mike Marra I think it's a very fair point that Mr Cole-Hamilton makes and certainly this legislation is a temporary measure I was convinced by the arguments made by the minister and officials in committee that this was a necessary stopgap for legislation to be brought forward what I'm looking for today is to be put in place that this is a truly temporary measure and on that basis it would be an assurance to this chamber I think to the Parliament and to the Children's Commissioner if we can have a date when that legislation will be forthcoming to ensure that these measures are as temporary as they can be so Labour will support the SSI but we believe it is imperative that the minister addresses these issues in the chamber today thank you I call on minister Claire Holly thank you Presiding Officer to speak to these draft regulations Scottish ministers have committed to keeping the promise by reducing cross-border placements to a minimum we all agree that they should only occur in exceptional circumstances last year the UK Supreme Court ruled the use of a court's inherent jurisdiction to authorise deprivations of liberty in residential accommodation is lawful and is not incompatible with article 5 of the European Convention on Human Rights where deprivation of liberty or doll orders are made elsewhere in the UK and children are to be placed in Scotland there needs to be an appropriate legal mechanism to recognise them currently recognition is granted through a court of session petition process which is not designed for these types of cases a lawful basis for deprivation of a child's liberty in Scotland is an essential requirement in terms article 5 of the ECHR the very essence of the regulations is therefore about ensuring that children's rights are complied with and ensuring compatibility with the ECHR the Scottish Government is satisfied that the draft regulations are ECHR compliant and we published a suite of impact assessments alongside them including a children's rights and wellbeing assessment detailing our considerations of children's rights regulations before you provide recognition of the doll orders in Scots law but with conditions attached the conditions mean that there will be greater accountability for authorities elsewhere in the UK to place children in Scotland and greater protections for the children in these placements I have always been clear that these draft regulations represent an interim step towards better regulation of cross-border placements and we are of course exploring long-term solutions as part of the children's justice a care and justice bill which we are currently consulting on and we welcome views from all stakeholders I know that the children and young people's commissioners office raised a number of concerns with the education children and young people committee we have engaged with the commissioners office and other key actors throughout the development of these regulations I wrote to the committee on the 23rd of May to respond to the concerns raised and gave evidence on the 25th of May focusing on the improvements that these draft regulations will make to the status quo for children placed in Scotland I also stress that the scope of these regulations is in line with the powers that parliament has granted to ministers that is to provide a route for legal recognition of deprivation of liberty orders and to deliver a better regulated placement process we are clear that funding models based on the acceptance of cross-border children cannot be sustained and that's why we are committed to looking at more fundamental measures in the forthcoming care and justice bill ultimately these draft regulations will not and should not be a substitute for proper provision being made available for children in England and Wales I've met with my UK Government counterpart to express my grave concerns about the lack of capacity which is driving cross-border placents into Scotland and we'll continue to seek assurances that these are being addressed urgently in the meantime we cannot delay in taking action to better protect these children that's why we brought forward these draft regulations which the education children and young people committee voted unanimously to support at their recent meeting on 1 June thank you this motion will be put at decision time the next item of business is consideration of three parliamentary bureau motions and I asked George Adam on behalf of the parliamentary bureau to move motions 4840 and 4841 on approval of SSIs and 4843 on designation of a Leeds Committee all move the question on these motions will be put at decision time and there are four questions to be put as a result of today's business members that if the amendment in the name of Kate Forbes is agreed the amendment in the name of Paul Sweeney will fall and the first question is that amendment 4815.3 in the name of Kate Forbes which seeks to amend motion 4815 in the name of Liz Smith on economic priorities be agreed are we all agreed the Parliament is not agreed therefore we will move to a vote and there will be a short suspension to allow members to access the voting system