 Mer котором, a fyddwch i ddweud hynny'n gweithio wrth gwrth gyrfaenwyntol deiligol ac rwyntrwynt Gwmiddag. Mae gafodd o gweithio'r llwy, daeth fyddwch chi'n dweud credu ddweud, rwy'n teimlo yn gwneud maen nhw'n fwy ychydigigwyd mewn proses. First of all, item one is a decision by the committee to take items three and four in private. Are we agreed to do so? I have apologies from Gordon MacDonald, who's unavoidably detained elsewhere, ac maen nhw i g 우� inhibi. Felly, rydym wedi bod gwneud pasteoant iawn o datblygu, ac mae'n cael mwy i ffrind o'r gwaen dinidol Gweithfawr, Richard Marsh, Margaret Cuthbert, John McLaren, Professor Richard Murphy, Professor Katia Montana. Felly, fod i'n gweithio i gweithio i ddatblygu i'n gwaeniffau hwn o gwbl hynny, and the Accuracy Utility and Comprehensibility of Scottish Economic Statistics to consider what data is required for effective delivery and scrutiny of policy, and perhaps most importantly, we would like to, after looking at this issue, recommend where any improvements might be made. We will go to our round table session and the idea is that hopefully discussion will flow ddoch tenant anodol i ddraeddwyr gwirion? Oni ddoch yn ddodol i ddraeddwyr gwirion yn ddwyd, jedi'n ddweud ddodol i ddodol i ddweud yr angen i gafodddu ar y prifwrdd gwael iaim. Felly ei fod yn dweud a yn ddodol i ddweud wedi'n dogfithu ei gweld â'r gwell ran ymgyrch a nesaf i ddyddugoddig i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i ddodol i digwyddau First of all, Richard Marsh. Thank you very much. My name is Richard Marsh. I'm the economics director of a small independent consultancy based in Cacoddy, and I've been working on economic data in Scotland for nearly 20 years. Hello, I'm Margaret Cuthbert. I work for no one, not even my husband, and I started off in a big business, ICI, and then worked as a lecturer, but for many years then worked as a consultant, but in recent years, and I mean that by the last 15, I've worked on major issues on the Scottish economy, but may I say, as completely independent people on PFI and Scottish Water on GERS, but on major issues to do with Scotland. Thank you. Ex-Civil Servant at the Treasury and the Scottish Government briefly spad under Donald Dure and Henry McLeish, and then working for CPBR at Glasgow University and Fiscal Affairs Scotland now defunct, currently mainly working in Scottish Trends website. Richard Murphy, I'm Professor of International Political Economy at City University of London. As you will tell, I'm not Scottish. I wrote a blog earlier this year on GERS, and as a result, I seem to have become engaged in this debate. I'm a chartered accountant by original training, and I probably am unusual in being both an economist and an accountant and bringing both perspectives to this debate. I'm Catia Montagna, a Professor of Economics at the University of Aberdeen. My area of research is mainly international economics, and I've been working with teams across Europe on recently, in particular, on the effects of globalisation, labour markets and competitiveness. Thank you. I should say that the sound desk will deal with the microphones. You don't need to press any buttons on the desk in front of you. I start with perhaps the question, what is the one thing that each of our witnesses would consider the key point in improving Scottish data, at which one of our witnesses would like to come in first on that? Margaret Cuthbert. To my mind, we're very lucky with the statistics professional staff that we have here. My big problem is that, in searching for data, it's a political reason why I can't get the data. I would like us to examine that. We've come from a dependency or a province of the United Kingdom. Through devolution, which was accepted by everyone, we got our own Parliament. I don't think that we have made enough of the political independence, to a certain extent, that that gave in looking after our economy and in collecting the type of data that is needed to run an economy. That goes all the way through from agriculture, fisheries, tourism, transport—you name it. We need more discussion of those matters, and it's political matters that need to be discussed, because our statisticians cannot provide the data unless they have the powers to do so. That includes, for example, in exports where a survey can go out to a very large number of thousands, they get a fifth of the answers back and they cannot force people to answer the questionnaire. On that, we base part of our export statistics. Who else would like to come in? Professor Murphy? I'd like to agree with Margaret, to be totally honest. I think that the interest that I always have in data is how decision useful is it. The data that exists appears to not be decision useful. It was designed a long time ago for a different environment and has been modified since, and quite clearly has been modified with good intent. Nobody questions that in the slightest, but it ends up not being of much use to anybody in Scotland, whether in the political domain or not, to actually decide what decisions have been made, who was responsible for them, were they successful, and what should now change as a consequence. That's what data should do for people, but it isn't doing that and it needs to be redesigned to achieve that goal. I would entirely agree as well that the problem is that the data to make this information decision useful does not exist. I've concentrated heavily on tax because that is the area where I have most expertise, but quite simply at the present point of time, the UK VAT system, the UK payroll, PAYE system, the UK personal tax system, and in particular the UK corporation tax system, as well as UK company data, does not provide information that lets Scottish information be separately identified on a reliable basis. As a consequence, we end up with a situation where so much that is looked at is inherently unreliable and can't be used to form decisions. Someone else wish to come in? Richard Marsh? Just in danger for the first time of having all the economists agree. I would like to put myself fully behind both those statements to say we know that the Office for National Statistics is moving away from large-scale surveys to making more use of this administrative data that Professor Richard Murphys just talked about. So if the VAT, the payroll, the corporation tax isn't properly identifying the Scottish part of businesses and individual activities, we're going to be in a very awkward position. The one thing I would probably say I would like to look at is what we've not yet had in Scotland is starting from a position with a blank sheet of paper. For the last 20 years we've always taken the existing figures and statistics we've produced and saying how can they be supplemented, how they can be amended, how can they be improved. No one's really asked the fundamental question saying starting from scratch, what would you measure to help us make good decisions about how to grow Scotland's economy? To do that I would suggest we need to have a more independent team of statisticians based in Scotland who can be innovative, who can create, who can look at the next generation of statistics that need to be produced. Thank you and John McClarton. I'll change the subject level although by and large I agree with what's been said so far but to bring it back to a slightly more basic level and to the economy I think the first thing we need to finish off is get a full set of national accounts. At the minute national accounts are published but a lot of it is derived or residuals and there's very little on the balance of payments, very little investment. These are key areas for the economy as a whole and if you want to then model the economy which you will need to do with the new powers. To finish off those national accounts will require more resources because the balance of payments including foreign investments to and from Scotland is very complicated. More resources in terms of money, in terms of good surveys but also in terms of staffing of people interpreting that data. Once you've got the national accounts in place then you can start to add other things whether it be in the environment or wider measures but I think that that is the initially the key area to concentrate. That's where much of the push has been put in so far and I think that we should extend that push until it's finished. Thank you and Professor Montana. Yes, I would endorse what has been said. I would also add however that there is an enormous wealth of data which already exists and which we are not able to access as well as we could particularly at the microeconomic level. Data existed under PINs aggregate statistics but researchers cannot access them and I think that therefore if you think strategically in terms of how to go about improving the data situation in Scotland I think in the long term yes all which has been said in terms of greater autonomy and of the Scottish Government and collection of new data is important but it's also important in the shorter term at a relatively cost-effective manner to try to improve what exists and accessibility to what exists is a key issue. Thank you and I think John Mason. It was actually on that point and it was what Margaret Murdoff said which was we're not collecting the data. I mean is that the problem? We're not, no one's collecting the data or somebody's collecting it and we can't see it. That's a very good point. There's an awful lot of data collected in Scotland but the way in which we have virtually been forced down the road of for example public procurement and you all know the history of public procurement and the PFI system has meant that we've ended up with non-departmental public bodies being in charge of large parts for example of public procurement. They themselves have either produced tremendous glossies which give figures and I tell you from experience of many hours you cannot get beyond the glossy figure on the thing. I cannot get the basis on which we've found. I might be told there was a survey carried out but I cannot find the detail of the survey and for somebody who once was called inlid or tentive by a Scottish Government official, obviously I do like to find the detail. Now this has become even worse with the Scottish Futures Trust who established hubs and while the Scottish Futures Trust is a non-departmental public body and is subject to freedom of information, the hubs are not. So how do you find the information? As I've said before, we don't have any information really on imports. How can we run the country as we hope to do in the future no matter which political persuasion you are if we do not have the basic types of data? You're right in two points. Some data isn't collected, we don't have the powers to do it and some data through the system that has been introduced of NDPBs and their associates we cannot get the data. Finally, freedom of information actually lets us down as you probably know in that previously it was 25 years or 20 years, now it's 15. If you're putting up schools in Edinburgh and it's 15 years before somebody like myself can actually get the contracts to see what's happening in construction, the buildings may be falling down before you get the, and a child killed before you get the information. Follow-up from Dean Lockhart? Yes, it was a follow-up on the asks for additional data across the table and it's interesting to see so much consensus amongst economists. I think we all agree that there is need for more data and better data, but I think we also need to prioritise given limited resource in this area with all areas. With the fiscal framework now with us, could I ask our guest what would be the bare minimum you think in terms of data, statistics and resource we need to effectively implement the fiscal framework? Not just implement it but model around it and understand the impact it will have on Scottish economy and the Scottish public finances. What would be the bare minimum ask to be ready for the fiscal framework? Richard Marsh? That's quite a big ask. What I would say is the thing that struck me from the Scottish economics statistics plan that was produced a couple of weeks ago said that we have 11 full-time staff working on national accounts for Scotland producing our GDP investment and so on. In the BEAN review he highlighted that New Zealand has 60 full-time equivalent staff working on national accounts. The UK has around 170. So I suppose it's difficult to provide a sense of the resource needed but certainly even compared to countries of comparable size Scotland's national accounts team is small. This is the point I raised in my submission that perhaps I'm fairly calling them statistical scavengers because they're basically trying to pick the bones of what are essentially UK data sets. Could I just make a small point on what John Mason was talking about earlier as well? There's a difference between the macroeconomic indicators that Margaret was talking about think what's our liabilities, what's our capital investment so on and then there's the micro data and that is almost criminally underused. We have a vast set of data covering most businesses in Scotland saying what their turnover is, how many people they're employing, how quickly they're growing. We can link various sets of data together to say have these companies been supported by the enterprise agencies? If they were did they grow more quickly than the ones that weren't? Have they been caught marked by the tourism industry? What happened to their productivity? Do they add more value? Those kind of things are largely a question of finding a way to press buttons on a computer. The thing that surprised me from the submissions, if you look at the submissions from Slade you ask them local authorities across Scotland what do you want from economic data? They said increased localised data a few other things and publication of sub indicators. They're asking more local data to publish it more quickly, to include smaller businesses and provide more detail. To me that reads they actually don't know what they want. They're not really telling you we need the following things. We've just had a review of business rates in which we could have pulled from that data set how much a whole range of different types of businesses are actually paying in rates compared to how much profits they're making, broken down by small towns, industrial estates, how have you chose to do it? And we didn't do it. The issue is it's not an reasonable position for Slade to take. I actually think they don't know what's possible. We have the Scottish Government statisticians sat on this vast reservoir of data that could be used to a huge range of policy applications and the people that could use it largely not fully understanding quite reasonably what it can do and we've got to try and have a meeting of minds there somewhere. But are you saying that partly that's because there's not the staff, I mean I think you've referred to pushing buttons on computers but if you don't have enough people to push the buttons you can't do it, is that what you're saying or does it go beyond that? What I would say it's possibly an issue that you would need some extra staff. I think if you're going to create a lot more data you would need more staff but I would say it's a culture issue here in that you can ask the question if your job is to produce a set of data describing turnover for 10 standard defined industries and that product has been produced the last 10 years. I wonder who's going to thank you for saying we've produced a fantastic new way of cutting this seven different ways which show really interesting things about Scotland's economy. Right, I'd like to bring in Richard Murphy. A bare minimum would be to first of all agree what the accounting framework is because as I've outlined I don't believe that what Scotland has at present is adequate. Income is accounted for on one basis and expenditure is accounted for on another basis and the consequence is that expenditure is always going to be higher in proportion to income in jures and it should be in a properly balanced accruals accounting system because in an accruals accounting system you have to undertake both on the same basis and that is not the case in jures at present and therefore right now the accounting framework is simply incorrect. I've also suggested and I agree with John McClaren that I think that there is a demand here for a full set of national accounts but that would also of course include a proper estimation of what the liabilities of Scotland are as well. Not just imports and exports and so on but also what are the assets and liabilities because you actually need to have a framework against which you're measuring improvement or not and without that you actually haven't got an accounting system and that is absent as well at present so there is a very real need to go right back to the start point that Richard Marsher referred to. That would be a first bare minimum. The second I am persuaded that although there are major problems as Margaret Cuthbert has explained with regard to getting data with regard to expenditure expenditure is probably better at least within Scotland not for Scotland but within Scotland better recorded than any other part of the existing data even if it is difficult to get at whereas the income side of the equation is very difficult to pretend that it's properly recorded. I was at another hearing in this parliament earlier this year where we were discussing taxation and devolved taxation powers and what is very clear is that there are inherent conflicts of interest inside many of those devolved taxation powers that are contradictory, make it exceptionally difficult for anyone in Scotland to decide how to use the power because for example income taxation on earned income is devolved and income taxation on unearned income is not and it is incredibly easy for a taxpayer to re-describe their income from being earned to unearned and therefore avoid the powers so there does have to be if those devolved powers are to be properly used much better information on taxation and that does require a new agreement between the Scottish Government and HMRC not Revenue Scotland but HMRC because this is a UK as a whole decision to identify in particular where VAT destination the point of delivery of services is not the point of supply but the point of delivery because that's what is important for VAT and it's not recorded but also with regard to corporation tax for example who owns Scottish companies companies that appear to be Scottish and how to apportion income between the two and this is an area I've worked on for 15 years and been told persistently it's not possible but now we are reaching international agreements on things like country by country reporting to apportion income between states if we can now agree how to do that in broad principle within Europe we must be able to agree how to do in broad principle within the UK it just requires the political willing to actually produce the underlying data to achieve that goal and it's not that difficult to do John McLaren I guess the answer to the question goes what are you going to use the data for so currently we're quite well we have quite a lot of data versus other regions of the UK if you don't mind expressing it in those terms at the minute but we don't actually use it for very much academics but rarely use the Scottish data I mean some will and the micro data is maybe slightly different but in terms of GDP data national account data because it's not in their interests because it doesn't do them much good in terms of their career it's not really used in the public debate I mean I put out something every time quarterly GDP figures come out and rarely if ever is anybody interested or is anything picked up on the papers and this goes through to a point I made in my paper about the media aren't particularly interested I myself would say that the parliament isn't particularly interested in comparison to other parliaments in the economy so if you're not actually going to use it for much you're kind of wasting your money if you're going to put it into that apart from at the minute now with you with the extra powers you'll need to forecast so that means you'll need a decent model which again goes back to decent national accounts but even in that model you could spend models very expensive to run and you could spend quite a lot of time and money on that model and get results that are guaranteed to be wrong how wrong is an issue but the OBR has an awful lot of money and is always wrong and he's been very badly wrong for a number of years now all Scottish models currently are not as extensive as developed as the OBRs want so if they were better that would be pure happenstance so again you're not going to get thanked for building a complex model that's quite expensive when it continually comes out with stuff that proves to be wrong which is a point that Jeremy Paxman put to the head of the OBR in a famous interview so it's a difficult question to answer because there isn't you're not guaranteed to get something that is deaf that isn't necessarily going to help you a lot the only thing I would say about the model is that yes the model will be of variable quality and be wrong most of the time and will never get big ups and downs but who would not try and model what their public finances are going to be you are flying blind if you don't do that in the same way that a company wouldn't it doesn't know what it's going to sell but it's going to make a prediction or a forecast of what it's it hopes to sell and then adjust as time goes on and that's what you do with models thank you I'm going to take another couple of supplementaries from committee members and then perhaps bring the our other two guests in on on this question from Dean Lockhart first of all Gillian Martin and then Richard Leonard so we're about to embark in this parliament this week and probably for many months to come on a big tax debate on income Scottish rate of income tax this these gaps in this data this is urgent absolutely urgent and I want to know your your thoughts on the the issues around the lack of information that we get on taxes that are reserved and obviously that includes corporation tax that and how that lack of information around Scottish corporation tax raised in Scotland that raised in Scotland is going to impact on the tax debate around the Scottish rate of income tax given the gaps that we have right and perhaps Richard Leonard's question then we'll bring our guests in on on these issues thanks committee it was to reflect on something which both Richard Murphy said and I know John McLaren includes in his written submission and and Margaret Cuthbert also talks as well about business registration I'm interested in a couple of areas around this first of all to what extent do we really capture all businesses that operate in Scotland versus businesses that are registered in Scotland versus businesses that are registered in the rest of the UK versus businesses that are registered overseas you know I wonder how thorough going the collection of data is in all of those areas because we know that from statistics how reliable they are we shall see but around about a third of the turnover or the GVA in the Scottish economy is overseas owned which is why I think John McLaren makes the point in his paper that we're moving to us to a calculation now of gross national income rather than just gross domestic product in order to try to understand the extent to which there is leakage from the Scottish economy so I don't know I don't know whether you could perhaps give us your thoughts on that new development and also where we stand and how reliable do you think we are with the collection of data based upon country of ownership? That's Margaret Cuthbert and then Cattie Montana. Well there is actually a lot of work going on right now in statistics in the Scottish Government on businesses and they're working with ONS on that and that's gone on just now but I quite appreciate the position right now is very difficult for example in the tables that we get there'll be ones that say businesses with no employees they can sit and think about that for long enough what exactly does it mean a business with no employees and yet it might be in there as we have had a growth in the number of businesses well what was that we also have as you've rightly said the problem of other companies from other countries who are owning our assets that becomes extremely difficult when for example we've got these new hubs set up and each one of them has a private company in there it turns out for some of them that private company was only established a couple of months before they got the contract to be part of the team of the hubs and being part of that team is really important because if you're a big construction company and you're in that group and that's sure you get quite a lot of the business and when you look at that company that's just been established Scottish company registered in Scotland you find that all of the directors are in the street in Lombard street in London so we're wide open to big big problems which are really not statistical and that need other types of input which we've not got and that's a really important point on the way through so hopefully that type of I mean that I'm getting carried away there are other things I wanted to put other ones so I'll leave that to be so you're welcome back to that hopefully. Thank you and Katia Montana. Yeah I think the issue of the ownership is a big one because the Scottish Government supplements the annual business survey by commissioning to what is it called now Dunand Bradstreet to provide information about the company which are foreign owned but we don't get hold of those we cannot put our hands on those data I mean the data are the information is produced at the industry level but we don't have information at the firm level so whereas the annual business survey data can be accessed through the O&S secure lab the Scottish data cannot so I you know I disagree slightly with what John McLaren said earlier that academics do not have an interest in doing work on Scotland I mean regional disparities for example in productivity are very central to economic research but it's very difficult to get hold of the data to analyse this as far as Scotland is concerned and the data does exist so accessibility is a key issue as well as the ability to link the different data sets and this is I go back to what I said earlier not all of the interventions which is required is necessarily very costly I'm not a statistician so I don't know exactly how many buttons need to be pressed but certainly it's I don't envisage it to be very difficult to to you know link link link things up at the source upstream in other countries the data the different data set sets are all linked up as I say upstream and in the UK it is you know the individual researcher who has to make the effort to link them up and apart from the margin of error which clearly increases but we may have three different people in Scotland doing the same thing so there is a huge duplication of effort and in essence you know a waste of public money because we are we are doing things more than once just are we in a situation where the data exists or is it a question of definition so for example we'll come on to Richard Murphy but he commented about companies now you've got obviously you've got Scottish registered companies English registered companies they can operate in England Scotland and abroad you can have English an example an English registered company but owns property or land in Scotland which is then rented out all sorts of questions about how that income is defined as being Scottish for taxation purposes or not arise so is it that the information is not available in a data form that economists can use or is it the question of the definition which may go into political questions already referred to about how that income should be defined as whether Scottish or English or in what way and if one thinks the international level big companies like Google and so forth and where they pay tax or how much tax they pay what exactly is the number of the issue for you I think there are certainly discrepancies between data sets about methodological definitions as well as sample size so that is probably where also some cultural change is required not only in in addressing issues of accessibility but also there is a difference between accessibility and ease of use so you can access sometimes data sets but then when you try to put them together they don't match in terms of definition in terms of sample size and time coverage and so on so there definitely are issues in Scotland with respect to all of those dimensions but all I'm saying is that making an effort in trying to overcome the accessibility and the linkability issue will also bring to the fore that type of of constraints and and and it you know there are there is an infrastructure in place in the UK about data collection which and I go back to something that Richard Murphy said earlier I mean it is I think very possible to and should be very desirable to try to work more closely with the ONS and HMRC and so on to to make sure that the UK data collection has a better reflection of of the Scottish you know sample thank you and Richard Murphy you wanted to come in I do because I think these two questions are directly related to each other the question on income tax somebody asked me to write about this yesterday and I would repeat basically what I said in April here in this room the question on income tax in Scotland is one of how effective is a rate rise going to be more than anything else and the answer is it may well not be very effective because it is so easy for people to incorporate what otherwise looks like an employment turn it into a company it will have an employee I expect it won't have no employees but it will probably have one who will be paid a tiny salary will then be paid a dividend to cover the rest of the remuneration and that will be subject to UK wide income tax rates not Scottish income tax rates and so tax avoidance will go on it is as simple and straightforward as that Scotland cannot enforce its own world with regard to its own income tax rate when it is so easy for income to leave the Scottish tax system and the question I was asked was will there be massive capital flight out of Scotland to avoid a Scottish tax rate and my answer was straightforwardly no there doesn't need to be because you can turn it into capital within Scotland and not pay tax on it so it doesn't need to fly anywhere the tax system lets that happen domestically and at that point this debate becomes you know not meaningless of course there are loads of employees in Scotland but there is going to be a lot of tension as a result of that but this also spills over into this question of do we know about Scottish businesses there is a very interesting statistic which companies house based in Cardiff produce every year because that is where the Scottish company register is actually run and it says there have been no prosecutions under Scottish law with regard to breaches of company law since 2008 now I don't know why there have been no prosecutions under Scottish law with regard to breaches in company law since 2008 but they appear to say they don't know of any does that mean that Scottish law does not exist with regard to the application of company law now I don't know it probably doesn't why because we don't have any company registration in the UK anymore let's be clear the company registrar in the UK receives information but it does not check its quality there are apparently four people reviewing the accounts of nearly four million companies to make sure that they have some truth and accuracy I will tell you that the only piece of information that is checked on the form sent to company's house is the postcode so long as you put an accurate postcode on then your form will be filed everything else is just inconsequential they do like the balance sheet of a set of accounts to balance but given the not every company that manages that and they get away with it that's how weak the data is we don't know who owns the companies the new regulation on beneficial ownership is entirely voluntary you can get round it by simply saying there isn't anybody who controls this company and nobody checks at all there is no data on source and destination of revenues and 90% of small companies don't have to file accounts which are a profit and loss account anyway bluntly we are living in the wild west when it comes to or the wild north if you like when it comes to company registration and data from company's house if you want to have a point to start have a Scottish company registry that actually enforces beneficial ownership rules which requires that full accounts be put on public record which reduces the risk and actually says that you're meaningfully prosecute people when they don't fulfil their obligations to either file accounts or pay their tax but at the moment so many people get round their obligations by registering a company it's ridiculous it's just license fraud but surely is that not dealt with by directors disqualification actions which of course there have been in Scotland since 2008 all i'm saying is that they carry on quite regularly do they not they say they're not taking place under Scottish law i don't know why they say they're not taking place under Scottish law but that's what companies now say what is not taking place under Scottish law they say there are no they do not know of actions under Scottish law perhaps they're using English law to prosecute in Scotland i genuinely don't know why they make this weird claim the point is though let's not worry too much about that particular issue the point is this is a UK wide issue there are around 5000 prosecutions a year for failure to comply with company's house regulations i don't dispute that of the of the prosecutions over half a drop when somebody turns up with a document which is the reason for the prosecution in other words if you haven't filed your accounts but then offer them to the court the prosecution is dropped that reduces to two and a half thousand but 400 000 companies a year in the UK as a whole not for Scotland but in the UK as a whole but proportionally i suspect the data is the same for Scotland disappear without traits that means they are literally struck off the register because they don't meet their legal obligations so in other words they don't have to pay their tax because they simply disappear and very few of these cases are pursued less than one percent to pursued it's so easy to get around your tax obligations as a result you're not in a position to tell us how many directors have been subject to disqualification proceedings in Scotland i don't know the scientific of Scotland but it will be a couple of hundred maybe sorry let me if in relation to failing to file documentation or accounts you wouldn't be able to tell us that would you i would be very surprised if it's more than 200 a year so there might be that there might be right but but it's a tiny proportion of the number of companies in scotland the scottish government says there's 345 000 businesses in scotland yeah well just let me stop you there but if you you don't know the numbers i mean we don't know the proportion of companies we don't know what is being done in terms of government enforcement in scotland one would have to look at the actual statistics of what actions are being brought before the courts and so forth and so on but again you're not in a position to comment on that are you i'm saying to you that there isn't the data available and anyway there isn't a system to make that data meaningful because there isn't a proper regulatory system to ensure that there is compliance in the first place okay no i mean that that's a different question there may not be data accessible to someone like yourself but that's why i can't answer your question well that's fair enough but one cannot then or you cannot make assertions about there not being prosecutions or whatever type of court actions being i was quoting current house they say there are no prosecutions under scottish law okay well perhaps we can move on i think richard marsh wanted to add comment and i think candy waitman then wanted to come in with a question very quick point not wanting to do down anything was just spoken about but i think the point is that businesses are messy and they're difficult to measure almost in the same way just like i get my toddler ready for her nursery in the morning businesses can make it very difficult for you to measure them they don't stay in place they move about and they change and they occasionally go out of their way to make your life very difficult the point that richard landed was was making he said a third of the economy is foreign owned you mean the business economy there's a big issue with trying to measure the public sector in scotland and we shouldn't lose sight of that that actually we really need to know how productive our public services are in scotland and the only point i suppose is is um catter again i kind of agree with with most of the points that that you've made i actually think it's great when you have um messy data sets colliding together that actually don't make sense because if they did i would be equally as as a suspicious of them so the ideal world is to actually take these data sets that probably weren't made for linking together to actually put a bit of time and effort in to try and say are there consistent measures coming out of this to julie martin your point about how can we measure these things properly um if we come to kind of like if we appreciate this is difficult to do but what's the best method to do it i was always amused by trying to measure corporation tax in scotland and we always said well what's the value of our economy what proportion of that is roughly profits the operating surplus and we'll take a pro router of what the uk is doing hugely blunt but you can say okay well it's probably it's probably not a million miles away but it's probably wet finger in the air about there could we get any more data from the treasure in hmrc no absolutely not impossible 2014 um suddenly we get a beautiful piece of research linking all the administrative data and corporation tax records with businesses identified as scotish to actually get a far better measure of corporation tax paid so gordon i think that's the point i was making terms terms of the culture it's when there's pressure there's a need to actually think of a better way to do things methods are quite often found thank you no sorry john mclaren then andy whiteman i think margaret cuthbert wanted to come in perhaps after andy's point yeah john mclaren just on the on the taxes that we have and perhaps the corporation tax that that would be interesting i mean the three big taxes are income tax national insurance v at those by far outweigh all the other taxes in terms of size but it's the the debate at the minute in scotland is about perhaps moving the additional rate up or down the additional rate doesn't give you much very much extra money so unless you use the move the basic rates and also that interestingly before the laffer curve was used by alex salmon to say that cutting corporation tax might be a good idea to get more people in but that was obviously originally applied to the income tax so the studies that the scotish government should do should be looking at both sides they should be saying if you cut income tax would that actually bring more people in but by being extra competitive i'm not saying that's the right thing to do but i mean that's what the study should be doing from from all sides because we don't have corporation tax powers at the minute probably leave that out for the minute but it is becoming it is quite a difficult issue because you've then got to say well what in the current modern day are going to be the behaviour impacts to those changes which is probably unknown but you can be guessed at at best um can i finish my point in then and the other thing is going back to richard's point i mean we don't really need to have gni modified gdp or whatever as a region even with some taxes devolved if we don't want to if you had full full independence or full fiscal independence it would be important but we don't need it but what it is important or interesting for is in terms of getting the right policies even with if you stay a partially devolved region within the UK because for example how do you improve Scottish ownership how do you how do you make these things that are currently an issue better and and you won't you won't understand that until you have a fuller understanding of the economy which is why the Irish economy looks at these about three or four different measures and just just recently introduced a new modified gni measure because the old two measures suggested that in 2015 the Irish economy in real terms had grown by 25 which is clearly absurd but so they had to introduce a new measure which only goes back a few years i mean but but Scotland is in a similar situation partly because of oil partly because foreign ownership that it's very difficult to actually really understand what is going on with the Scottish economy and therefore how wealthy and prosperous it is and how it's growing to bring Andy Wightman in in case he has a point that's going to be superseded if we carry on in this very interesting discussion thank you community I just wanted to move the conversation on a little bit i mean i was interested in Richard Marsh's comment about starting with a blank sheet of paper and i think this is an opportunity inquiry because we're at an important time in terms of public finances and tax powers in this parliament and the intertwining between the interrelationship between tax powers and how they're used and the performance of the economy i noted in a number of witnesses statements i thank everyone for giving a lot of very very useful written evidence that there was there seemed to be support for making the Scottish statistical collection a more independent project with an independent authority possibly with more powers i was a bit disappointed to read Scottish enterprises evidence that said the Scottish economic data are reliable as far as we are aware and if there are any inaccuracies for whatever reason they're likely to be small it's our chief economic development agency for the central central of scotland so i just want to witness is it would agree that we need to move in a direction that gives us a more independent statistical authority with greater powers to compel the acquisition of data and i note for example whatever one thinks of the argument between the chair of the ons and Boris Johnson that the chair of the ons felt able to speak out when he rightly or wrongly felt that statistics were being misused we couldn't do that in scotland because there is nobody of that nature commenting at least on Scottish statistics i'm sure the chair of the ons would speak out if he felt that any members of the Scottish government were misusing UK and ons collected statistics so i wonder what your view about independence and greater powers for stats in scotland perhaps we start with Margaret Cuthbert there's very happy to answer in that one we actually did have much more independence on the chief statistician speaking out in scotland prior to devolution but at that particular time he or she it could go with all the he mind you could always go directly to the head of ons and stand up for the quality of statistics that went with devolution i cannot think of any example where the chief statistician has been able to stand up and say we're not doing that and in fact we have seen recently even that the accounts commissioner gave in if that was true that was in the papers but actually if we had one andy we might actually have a proper answer to your whole of government accounts question which you asked last year and you asked could we have whole of government accounts and the answer came back which was completely messed up we do not have whole of government accounts we could have them but somehow or other people are stalling is this because the liabilities of scotland would be shown if we had them and this all adds up to have we got the proper system in place to make sure that we are no longer a colony but actually moving forward as this parliament expects to be doing and it's not just a criticism of politics it's actually a criticism of the academic world as well in the 1970s when i produced the first paper i know of on public expenditure in scotland i was told at that time by the scottish head of the scotish journal economic research that in fact that was a parochial thing that was not carried in scotish journals i see no difference today other than the phraser of anandah and in fact it was the phraser of anandah that used that paper as one of the first economic reports we have to change not only the effect of committees like this but our academic world is appalling what john was able to tell us today about lack of interest why are we paying for any contribution to them if they're not actually producing decent stuff on the Scottish economy which is helping groups like you did you want to expand on the point about why since devolution you say that hasn't been possible i mean i don't think anyone we seem still thank you we seem still to have a mindset that we are collecting data that is feeding into a larger group i give you examples on that on agriculture you know we're now not going to have any comment whatsoever on the agricultural statistics for five years here we are facing brexit said in the papers we probably wouldn't survive the super supermarkets probably wouldn't survive for four days if things stopped and as far as our agricultural statistics school it's just a series of data and it's meaningless to most of us on the way through as far as um what else we got fishing if you go into fisheries and you ask about can quotas be changed from one group to another you'll get a series of chats telling you oh no you can't move the quotas but actually you can sell the ships and the ships have the quotas so you're lambasted with information which at the end of the day is very difficult to understand now i give you all a lovely thing to do over next week try it yourselves and see how many hours you spend on it and how much brandy you need at the end of the day so we have a we do have a big problem but actually i think a lot of you in fact knowing some of you on the way through i think you'd actually be quite interested in what taxes could scotland actually put in place that are not these ones that is john defined um take up most of our taxation but in fact don't necessarily help the poorest group in society what about a land tax i mean that that's just one of them i'm any one of the many but i'm sure you can all think of other ones why are we still sticking to a taxation system that is maybe not appropriate to the Scottish economy or Scottish society right well thank you i think that's starting to strain the questions of politics and what we might do whereas i think we're trying to focus on what the statistics and data that we have at the minute are richard marsh you wanted to come in and may i ask do you think that the statistical team in scotland has been less independent since devolution well i suppose it's i think i echo what margaret says it hasn't been independent since devolution in terms of what's happened it's really the pressure that's been placed on scotlands are the independence the effective independence of the office for national statistics what i'd say is we've got a scottish fiscal commission and we have the national accounts team they've both got a render 11 people working for them the national accounts team is by far the most important team in scotland without producing that core economic data we could not forecast we would have nothing to work from one of those teams is independent and well resourced the other is not we have to think carefully have we got the priorities right in terms of i think andy whiteman you you mentioned the foreign secretary and the statistics authority the example i kind of i kind of give was was just was produced last year on the 24th of august and it's a national statistics publication it's a kite mark publication produced by the government so we knew the data was coming out months in advance the day before a previous unannounced paper on the cost of brexit to scotland is produced without any warning on the Tuesday and i think it was the bbc's brian taylor covered it to say is this politics or arithmetic and saying clearly the government is seeking to preempt the results of jure's the next day that in itself is very worrying that you have a producer of official and national statistics that the bbc's brian taylor is suggesting could be seeking to preempt its own products whilst that's worrying that there are two things that are hugely important that didn't happen unlike the situation over the weekend the statistics regulator didn't say anything it wasn't called up as a potential breach of the code of conduct and perhaps more importantly scotland's chief statistician didn't say anything so if you have an independence to six body covering the uk saying they're disappointed and surprised at someone confusing a gross and net figure the chief statistician would suspect would be furious or as close to furious as a statistician can get that someone's tried to preempt that someone within his own organisation has sought to preempt a kite mark publication but at that moment at the moment the guy who's actually filling effectively filling the role of the chief statistician and the regulator at the same time is effectively the bbc's brian taylor and he's got a lot on his plate so we shouldn't really be leaving this to to the media to kind of police and point out the role of the statistics and when you say chief statistician you mean the Scottish chief statistician it's a small distinction but very important for the ons the national statistician is independent of government in scotland the chief statistician is the Scottish government's chief statistician and do you think the chief statistician should have a different position or terms of appointment than at present if we think of um if we think of the situation i've just described there are several instance along those lines it's difficult to see how you can you can foster that culture to say i want you to be innovative to think of new products to actually be quite open and explaining what your statistics mean if you're not independent of the government of the day so you think the chief statistician in scotland should be independent of the government of the day more independent i suppose i find it harder square um i suppose you'll know better than i will the speed at which the scotish fiscal commission was set up and constituted as a non ministerial department and we've had 20 years of a national accounts team who are sit within the rest of the civil service okay i think john mason wanted to come in on this question of the fury of statisticians i mean i don't disagree sorry with what mr marsh is saying i'm just wondering about the cost i'm an accountant so i suppose that's logical i mean the scotish fiscal commission was set up independently despite the government and certainly myself disagreeing with that and i think one of the factors was cost i mean we're 5 million people the UK is 50 million or england's 50 million we cannot possibly copy everything they do in the way they do it at that expense when there's a tenth of us so has there not got to be some kind of compromise to do things smaller and i would hope more efficiently while at the same time having this independence i love your statement there we can't possibly copy what they're doing but we're trying our damnedest at the moment statistics in scotland we try and ape a great deal of what's done for the UK i think we should try and stop doing that in terms of the cost for say an independent statistics body in scotland really the main thing that we need is for the head of a statistics profession in scotland to be independent of government and be able to say i think the most important things we should measure are the following five things we'd be measuring the follow 40 things and really they don't matter very much we can have a debate around the table today everyone will have a view as to what they think should be measured for scotland's economy whether jures is fit for purpose or not fit for purpose it doesn't really matter what richard murphy thinks or i think it actually matters what an independent statistician thinks and that's where you build trust in the statistics right i want to bring jamie halko johnson and then richard murphy since he's just been spoken of to comment on this as well yeah thank you community it's just to kind of rather ties into that um Margaret cothbert mentioned the public sector and the lack of perhaps transparency in some of the contracts the ndpbs obviously you've talked about um chiefs statistician and their role i was just wondering what the um the Scottish parliament or the Scottish government can do now to make to i suppose make some of that data more accessible more transparent what actions it could take and also what perhaps national or regional examples there are that we should be or we could be looking to model ourselves on if say trying to kind of mimic the the UK wider UK model isn't really suitable well um Margaret cothbert and then perhaps richard what can i say on the um exports and imports um and on quite a number of statistics i've found actually that the northern island office has cheaper system than we have and has a more timely system so that's possibly something we should look at the other interesting thing was that when they are looking at for example um public procurement they don't look at value for money they look at value a huge difference so there are things that we could learn from a much smaller country um which is still part of the united kingdom on how they've managed it i don't know i haven't had the time to investigate i only know the results Richard Murphy i do a lot of international comparisons in the work that i do around taxation um and we often use median states for review because median is more important than mean of course in this area and on that basis Scotland is a median mid-sized state in its own right um 5 million is plenty enough to put your well up the order um somewhere in the middle so you know Scotland isn't a state a region of the UK however you view it that is small in international terms um yeah the British Virgin Islands is but Scotland most certainly isn't um and on some things the British Virgin Islands actually might produce better data than Scotland which is quite shockingly true um not many but some um so and if you look at a place like Jersey its national accounts are substantially better than those available for Scotland i mean much as it greaves me to say so they've really got it right and if they can afford that with 100 000 people why can't Scotland with 5 million so there is obviously an issue here and actually it does come back to this issue of political will i am very uh first of all let me make the point all data is subjective all data is political because what you choose to measure is obviously a choice um there is no such thing as objective data because what you measure changes it um we know that it will change performance it will change behaviour so therefore i am worried about the concept of independence just as much as i worry about the concept of independent central banks which actually normally aren't at all as we know in the case of the UK as a whole because you only have to look at the banking act 1998 to see that the independent bank of england is in fact subject to complete and direct control by the chancellor who can at any time suspend the governor of the bank of england if they don't do what he wants um it's always been a he so far um so therefore there isn't an independent bank of england independent international statistical authorities will have the same problem there does at the very least have to be very sensible dialogue between the government as to what it needs to make decisions and what a statistical authority wants which it thinks is important because they may have different priorities i wish to make that point very strongly because otherwise you'll end up with information being produced for the wrong purposes again which doesn't suit the political purpose of a government but suits the political purpose of a director of a national statistical authority and both will have whether they like it or not political purpose because we all do it just is a matter of fact whether which party political doesn't matter there will be political purpose to the decision so in the end of the day you might as well be explicit and have a very clear role for government in it whilst that person must also have the right to squeal and say i'm being put under too much pressure for a particular result um jenky bailey i wonder whether we could move on to a substantive discussion about jazz um and let me quote back at you professor murphy some of the things that you are on record as saying and perhaps get a view from the panellys to whether they agree with it or not um and i hope i'm quoting you correctly but um you said that the jazz figures are untrustworthy rigged by Westminster literally made up and nonsense and then you go on to say no accountant could use the jazz methodology without risking the allegation of professional misconduct i wonder whether i could put it to the panel assuming i've quoted you correctly whether any of them agree oh i'll take silences no agreement at all oh silence is not golden in this case um Margaret Cuthbert well in fact as i wrote in my piece um for this i objected strongly to the word that jazz was used as crap um i don't know if um Richard murphy sorry i don't know what's going on i'll need to give you a big pudding when you come anyway i don't know if you have done as much work as Jim Cuthbert myself in going through line by line every bit of jazz when we first got it under freedom of information since those days i know that there's been tremendous work done on it by the statisticians almost every bit of data has uh some bit of estimation in it an estimate is worthwhile if it's got a small deviation on either side and i would say that tremendous work has been done to try and reduce the uncertainty over some of the statistics now there is a group which has been meeting on jazz jazz keeps changing its composition to some extent as we go on that group's meeting and as successfully considering changes to it there are some things that i wouldn't necessarily agree with but we cannot run an economy where the main taxes etc are from another um what would you call it another government in a sense and not have estimation i can assure you for the years that the department of trade hmrc and private have certainly all cooperated with me fantastically if it question then to professor murphy because your contention is that tax revenues generated if i've understood you correctly from spending outside scotland should be attributed back to jazz now um if i've got that right is it the case that this would be the only set of national accounts where that would happen in or can you point to others where this is routinely done well the question there is of course most national accounts are prepared for nations and we're talking at the moment about scotland not in that sense a nation um we are talking about it as a part of the uk because it is constitutionally a part of the uk at present but it does obviously have its own parliament which needs data my point was very straightforward with regard to accounting you can't have one basis for recognizing income and another for recognizing expenditure one which is only income in scotland and the other which is expenditure for scotland which includes expenditure therefore incurred outside scotland which does generate tax revenue which is excluded from consideration on the income side and then take one of the other because that's simply apples and oranges accounting they're not the same thing if an account it was to do that i stand by the contention i made i think they would be guilty of professional misconduct and i would expect them to be pulled up before their professional body and told that you aren't preparing consistent accounts prepared on accordance with a consistent accounting basis and that's what's required so i completely stand by that um the suggestion has been made but it will be small there are no other areas that produce national accounts in that way and the way you've just described i mean i'm looking to try and be helpful is is that you know somewhere i can go see this what you describe well any country there are obviously is expenditure which can be incurred outside a country i mean the point has been made to me for example that in the uk as a whole we spend money on overseas aid and that spending takes place outside the uk and that tax may be paid on that in another country and i would accept that point and that has been said that therefore that is the same as the scottish situation of having spending attributed to scotland and which tax is not paid no it isn't because that is paid by the uk government deciding to spend that money overseas therefore under the central government direction of control whereas the point about or the point i'm making about jers is that the expenditure which is allocated to scotland is not under the control of the scottish government and therefore if this is meant to indicate the activity within scotland which is under the control of scotland it doesn't so they are totally inconsistent so i don't know of another example of that sort in other words okay that's helpful to know because i think you know if you're making that suggestion of how to do things then clearly we would want to look at other examples and there are none i can't think of one okay and neither could i but in you know fairness you're you're the professional rather than me i'm trying really hard to struggle to answer that and i genuinely can't think of one you then go on to say and i just want to explore this because i think this is hugely important for us to stand understand you then go on to say that the net benefit flows very heavily from scotland to the rest of uk and the likely under statement of scottish revenue resulting from this flawed approach to national income accounting is likely to be very significant have you got an order of magnitude for what is very significant well how much money are we talking about again one of the suggestions that came out from the discussion the phrase that allender was involved in this was that this would give rise to a restatement and if my basis of accounting was used and i can't remember precisely the number your colleague mentioned but we're talking about a couple of percentage points or so of the state of scottish deficit may be but again we we're using some estimates here and very rough and ready stuff which is done on the basis of blogging not on the basis of you know doing a lot of deep searching and i'm not pretending i have but the point here and i'm not pretending i have done that deep searching but the point here is that actually even if you do the deep searching i'm going to go back to margaret's point here actually i mean i know you didn't like the use of language but i mean i'm afraid to say i sometimes use language to put something onto a political agenda it's you know i've been involved with trying to put deeply unsexy issues onto the political agenda for a long time your tax wasn't discussed when i first started talking about it tax havens weren't discussed and nor is national income accounting something which is normally picked up but when you use some sorts of language which puts it in newspapers well i'm as far as i'm concerned if it creates discussion it's worthwhile but the point is if we haven't got underlying data to prepare these estimates i can't be sure can i just say you don't need to use that language to make this interesting to me i'm already there can i can i can i can i can i ask you because Fraser of Allander did in fact look at the assumptions and and notions that you raised and i quote from them changing assumptions about how much spending is allocated for Scotland or spent in Scotland in jazz will change the net fiscal position but any revisions are relatively small so actually rather than being very significant they are actually quite marginal would you not agree that that's the correct interpretation of the Fraser of Allander position no i wouldn't and for a number of reasons one is that for example we don't know flows in and out of Scotland something that has been consistently said we don't truly know what the income flows in and out of Scotland are and i think if we don't know those we might well be mistaking what Scottish income is anyway i mean so we don't actually know some of the basis on which these estimates should take place we don't also know what the multiplier effect is of some of this expenditure which is being incurred outside Scotland might be and i raised the point as well that we're not just looking about the impact of the expenditures at their first stage of measurement but that actually in economic terms you actually have a consequence of that spending which could be greater than the initial spend that is a fiscal multiplier attached to these that was not taken into account as far as i know in those figures i am not disputing at the end of the day that the jur's methodology is going to show that there is a deficit for Scotland let me be clear about that that's not what i'm saying i'm saying the methodology there is does not work at a theoretical level and therefore we need to go back to start again i'm basically suggesting as Richard Marsh has done that we should go back to a plain piece of paper and start from there and if we did we wouldn't end up with jur's is my point i think that what i'm trying to do is understand your position and look for evidence of it what i'm hearing from you is that there is no evidence that that what you're doing is is you know asserting in in the absence of numbers a particular position i'm saying and i as far as i can hear if this has been agreed by Fraser Valentine there would be a restainment of the figures if my position was correct they've said this would undoubtedly change the numbers they've said it would be small what is open to question i'm saying it would be bigger than they say because they haven't taken a fiscal multiplier into account but they're saying it would not be dramatic and i'm saying it may be bigger than they're saying would it change overall i don't know but i'm also saying jur's as a whole is incorrectly prepared and therefore is not the basis for comparison for the future what i'm trying to understand is the basis the evidential basis of you saying it's going to be very significant when we've had Fraser of Allander saying it's going to be very small when the whole of this issue appears to be that Scotland is in a major fiscal deficit position and the data can't be certain to support that particularly when we don't know what imports and exports from Scotland are and therefore that figure may be heavily misstated and actually i am looking at data at the moment on Scottish imports and exports which show that the data for Scotland looks to be so dramatically out of line with the norm that there's something obviously wrong with it then i think that we are in a position where we can say that data could be seriously misstated but do we know precisely no i accept that point i'm telling you i've said it time and again we haven't got the data to be sure about that but nor have you got the data to be sure you're right either is my retort i may be wrong so may the other people be rather guess into the discussion before we do that Richard Murphy are you seriously saying that the i think it's not a colony nowadays it's a british overseas territory the british virgin islands population 28 000 plus has better statistics than scotland i think there will be some statistics they produce not many that will be better than scotland i think in the case of jersey many of the statistics will be substantially better than scotland in particular jersey does produce quite reliable accounts which show who is responsible for what it does have gni data which is reasonably reliable and i think that actually it would be worth looking at and if that island can produce better data which is more decision useful probably than that which is available to many scotish politicians i think it's something that needs to be thought about seriously right so it's something we'd have to look at the specifics of uh john mclaren and then catty montana just a brief point if you're looking at scotish exports and imports then you know more than i do because there are no scotish imports data there's a there's an imputed residual in the in the quarterly national accounts but that's a huge problem because it's like well if anything is wrong in throughout the national accounts it ends up in imports so it's a highly questionable figure and if you look at the figures even for exports there are two main measures for exports and quite often year by year one will go up and one will go down which doesn't fill you full of hope that they're particularly accurate but that's a slight move away from jersey i mean the main point i want to say on jerseys is that i think the point that you have is is of interest i'm not sure it would change the as you say it wouldn't change the overall result i mean jerseys is a bit of a dead end these days and that we know what it's going to say i really wouldn't want to put an awful lot more time and effort and money into expanding it perhaps a little bit but the money could be better far better spent elsewhere and that's where that's where it should go so i think if we can try and get away from simply much of this is to do with finance rather than the economy and i think it's you know if you concentrate on the economy and then go to the to go to the fiscal issues that are relevant to that but but a lot of the time we seem to be and perhaps perhaps because jerseys dominates the the debate whereas when the quarterly national accounts are published it gets no coverage whatsoever this goes if i can just make the opportunity to go back to the point that Andy Wightman talked about before if there's something in this data whether it be jerseys or something else that the statisticians aren't happy about i mean how often do you hear the head statistician in in the uk speak out very rarely or OBR very rarely it's actually exposed by the media and by think tax whether it's at IFS or the financial times that's what we really lack in Scotland in terms of getting through holding figures to account holding public public the government to account ministers to account that there isn't the analysis being done by these independent bodies you can you can create an independent statistician if you want but it's not it's not really going to he or she because they've got there as a career move partly so it's these other elements i think that need to be brought in but as i say i think you know i think we've i think we've exhausted jerseys in terms of the good it's going to do scotland and the scottish debate in terms certainly in terms of the economy catio montana i won't comment on jerseys because i i don't feel i've got enough expertise to do so but i think it is certainly true that one of the problem with the scottish economic data is that it is not always possible to disentangle them from the uk once once but one point i would like to make is that perhaps there has to be a more nuanced distinction between micro and macro data because ultimately the macro data come from aggregating upward micro data and we don't have any data on imports but even the data on export which i think comes from the global connection survey now the global connection survey has a non return rate of about 70% so it is based on a fairly small sample of firms and it is also biased on non exporters so it doesn't capture for example if there is a a change in status of firms from non exporter to exporter so i think you know to go back i think we need to to have a i take all the points which have been made on the national accounts but i think we need to have a more holistic approach and try to see the micro and macro side of the data as as being more interconnected and in this sense to go back to the earlier debate about whether there should be a higher degree of independence of the scottish statistical agency certainly in the long term in the long term that would be important but i also think to go back to a point that margaret made earlier i wouldn't be too concerned about the scottish data collection system feeding into a higher level because ultimately the major progress is which have been made in recent years in in in in europe and beyond have been at an international level so it is very important to join up forces coordinate collection follow follow you know uniform protocols to ensure comparability of data because a lot can be learned in terms of being able to compare you know the the evidence which comes out of regional or national data internationally. Thank you and Gil Paterson John Mason wanted to enter the discussion on some of the points that have been given to you. Yes, one of the biggest things sticking out for me in GERS is the fact that so much money billions of pounds are spent money that's raised in scotland and tax is spent for for scotland and so as an impact in the first instance the first whammy is that that money being spent somewhere else out with the scottish economy and then the second bit is that that money is spent primarily in another part of the UK so that's the second whammy. The third whammy is this and this is a big political i don't think John that we can ignore GERS because it's used extensively in one way or another either to talk scotland up or to talk scotland down and it's and you know phraise lallander for instance published figures and everybody was already lining up the night before to say that scotland was failing so that's just an indication that phraise lallander happened to be wrong it went in the other direction so it's a big big political football but the third whammy is this is that the third whammy is this that the places that benefit from this Scottish expenditure are used to measure against scotland in a political sense so these are these are big big issues and you know looking at everybody that's written into us in this exercise there's nobody has said that the stats are good no it's uncertain nobody has said what they're absolutely brilliant everybody's get qualifiers all along and GERS is the same but so my question is you know where is the information where is the information to say what the actual the amount of money spent in the UK no not overseas in the UK that's actually taken from scotland and what impact has that got in scotland's economy and what impact has that got in the place that we have been measured against where are the stats you know politicians should get that answer so important perhaps john mclown would like to comment on that since he's been mentioned and then we'll come to john mason difficult to know where is that i mean i disagree with virtually everything you said the and i'm not saying that as a political i mean one three reason i think we should park GERS is because it is too political and it does get to these places where it's good or it's bad it's not it's saying something about what would happen if scotland based on the current spending patterns and tax patterns if scotland became ffiscally independent that's all it's doing which is not particularly interesting but the everybody who is looked at the figures agrees and has agreed for the last number of years that scotland would be in a deficit position versus relative to the rest of the UK as would Wales as would Northern Ireland there is nobody who has produced any figures to say anything else scotland got uh relative to the UK i think it got it's got worse than worse than the last few years because of north sea oil it's not a great mystery as to what's happening and it's not a great mystery as to why more money is spent in scotland than in other parts of the UK because scotland is a third of the size of the UK and has a network of islands so you'd expect more money to be spent per head a little bit is is earned in terms of tax per person which is because there's not because london basically has a impact in terms of most of the high earners in london but um other than that i don't think there's any mysteries around around the data in jures mason and then we'll bring in margaret cuthbert well i was going to refer to her anyway so she'll when we come in anyway but um yeah i was going back to right at the beginning of the discussion in jures um and margaret cuthbert was saying there had been improvements and kind of defended the position of there will always be estimates and we can make the estimates better and that's the kind of technical area i'm interested in because i think i started off earlier this morning thinking that we should move everything to admin data and use that instead of like a portion mint or estimates and you can correct me if a portion of the estimates are the same thing or they're not quite the same thing and then professor montana has been talking about micro data i'm not quite sure if that's the same as administrative data but this concept of should we move wholeheartedly to just collecting every little company's details and adding them all up and yet i think mr marr she said that a lot of that that is pretty messy or it's it's not very dependable or do we just accept that apportionment for vat or some of these things is perfectly acceptable it's not perfectly acceptable and i'm actually very much in agreement with John McLaren that there are other issues that are of much more importance for us right now in on your job in the economics jobs and fair work committee than GERS it really should be taking a bit more of a back seat i have carried out endless conversations with various departments in England in the UK government on whether we can do any better than what we're doing just now i can't see it without a tremendous amount of expenditure on our behalf of setting up units and even at that we don't have the political power to get information from companies it doesn't exist so i don't see how we can do anything else at the minute other than use UK departments to get the information but hrc seems to have moved from pretty vague estimates because they've been forced to with income tax giving people an s code and at least they will shortly have definite figures so could you could we just do that with everything do the same with that do the same with corporation tax do the same with everything or is it not as simple as that i don't think it's anyway as simple as that actually because of some of the things that Richard Murphy said and Richard Marsh we've got it's a very dirty field business data and they are trying very hard in the ons and in the Scottish government to try and get more detailed local information it's a huge job and i don't know how long you would actually have to ask the statisticians themselves on that how it's progressing but at the minute it's a job that's on going i don't know where it'll go okay yes um can't hear montana briefly answer your question about the difference between micro data and administrative data yes micro data could be administrative data micro data is data collected for example at the level of the fair and in some cases it is connected via questionnaires surveys other in other cases it's collected through vat return in that case it is administrative data so it typically tends to be more reliable than if it is correct collected by a service and in fact there is recent research which shows that data collected by within the famed database which is a privately produced database is less reliable in terms of information about whether firms are exporters or no than data which come from hmrc so you know ideally the more the data is collected through vat return and so on the more reliable it is but it is to mention another point that you you made it is you know very important to have as large a sample of the population of firms as possible because the reality is that the majority of firms across Europe 98 percent of firms are small and medium enterprises and about 60 70 percent of those are very small so if you leave them out you actually miss out a lot of economic activity within a country and and the distribution of firms within industries is very important in enabling you know us to understand the impact of policy for example so it's not you know if you you can't focus on the average productivity of an industry what matters is how the productivity distribution looks like and there is a huge variation across industries but also across regions and countries there's a very recent experimental paper they call it by the ons which looks at productivity differences across regions and they show that it is not the composition of industry which matters in determining the productivity of a region it is the distribution of firms within industries so there is a lot of information which is required in trying to understand for example the productivity puzzle which comes from firm level data that's why it is important to get it as much as possible. I think Ash Denham wanted to come in at this point. If we're talking about decision useful data because obviously as an economy committee we want to look at you know the sort of data that might help us make more or better decisions and we know that the Scottish Government at the moment is judging its progress on what they're calling the four eyes so I'll take it everybody's familiar with what they are so are the existing stats that we have you know useful to judge whether the Scottish Government is making progress in those four areas or not. Margaret Cuthbert first of all. Yes I have a big problem with that kind of data that the Scottish Government really needs and somebody's mentioned Scottish Enterprise already on the way through if you look at any of these NDPBs and the information that is given is almost impossible to find out why they have said we have helped let's say 85 per cent of businesses what does that mean and then you say well is it advice is it finance is it whatever and then how have you monitored the success of that and how have you evaluated the programme at the end of the day and if you want to spend half a week in my filing cabinet good luck to you. It's impossible to get the information. I've mentioned Scottish Enterprise. They cannot even split up for Scottish Development International how much they have actually spent on encouraging exports and how much they've spent on encouraging foreign direct investment. A committee has actually asked them for that information. They were told they would get oh I'm sorry I don't have that just now you'll get it but we're still waiting because I ask have you got it yet and this is a year later we still they still don't have it. So there's a big big problem in trying to get this type of information that the Scottish Government is happy to put forward whether it's helping businesses or the other one is on skills with modern apprenticeships we're not getting back the real data that's needed and again when I ask you to go and look at the reports by skills on modern apprentices and sit there and think instead of watching 10 o'clock news what they what you're actually getting from that and the questions that you yourself obviously would ask and then phone them up and ask or write an email better. The answers are not there. We are living in Cloud Cuckoo land as far as the this programme goes. Thank you very much. The four eyes that the Scottish Government is working towards I think it wouldn't be entirely unfair to say we've decided to go down this road of a slightly different economic strategy with the four eyes with perhaps the biggest change being tackling inequality and what's happened is we've looked at what data we have and said how can we best use that to measure progress against these four eyes rather than what more do we need to do to better fill in the gaps. I was at a business breakfast lunch in which someone from Scottish Enterprise was stood up and they were asked about this dimension of inequality and inclusive growth and they said well we know what inclusive growth means it just means growth and half the half of them said oh and the other half I thought was kind of well this has been honest and I actually think that's probably where we are I mean in terms of what what do we mean by inclusive growth and what kind of data should should we be picking up picking up on um there's a there's a theme I think John mentioned it and Margaret mentioned it earlier to say are we using the data the data we've got are we using it in the right way if you look at the quarterly national accounts the thing that jumps out on you is taxation on individuals has grown substantially over the last 20 years in Scotland taxation on businesses has been virtually unchanged virtually unchanged now that isn't picked up at all but that surely is a huge issue if we're going to raise the rate of VAT raise income tax at the same time cut corporation tax and at the same time say we will tackle inclusive growth I think that's the kind of data we actually have ready to hand that we should be investigating a bit more and Richard Murphy thank you for your question because it moves us on um I will slightly heart back to Gers there and answering the question slightly the four eyes make sense in a very real way you know who wouldn't want investment improved international trading positions innovation inclusive growth I mean it's sort of you know invert them all and would you not want any of those no so therefore they must make sense um they are a statement of what everybody would probably want they made us put four eyes on the front of it does this help us does the data we've got help us well actually no in a very real way um it doesn't answer the question why there isn't inclusive growth now for example because and for example we don't know how many assets there are in Scotland we haven't got a figure we haven't got a balance sheet we don't know what is happening we don't know whether there's a net investment or not because the accounts that are available are an income and expenditure account prepared that's what Gers is um prepared on an inconsistent basis with no balance sheet to prove that there has actually been a net improvement of deterioration in the Scottish position nor do we know who actually has the liabilities it shows a deficit but we actually it isn't clear who pays for that and there's an apportionment which of liabilities which may be inappropriate so to make this work there needs to be a much better awareness that to drive any form of growth to drive international investment you've got to have measures of actually what is the capital accumulation that is taking place inside Scotland and not the financial capital but the actual real tangible physical capital which is going to give rise to changes in productivity and the therefore the increase in wages which is obviously the driver which is underpinning that which is one of the reasons why at present Scottish state expenditure per head is higher than it is in the rest of the UK because average wages in Scotland are lower than in the rest of the UK which is also true of Wales and Northern Ireland which is why it appears that so much of the UK deficit is attributable to the regional governments rather than to England so without that information which is about assets then you can't also and a proper balance sheet and who's funding that you can't actually come up with an answer to these questions and you can't come up with an answer to that question until you know who's actually also funding that process and right now that is not clear either because there isn't a Scottish liability side of the balance sheet either and is Scotland liable for the debts that are recorded as a result of deficits being incurred because actually the Scottish government can't be liable for those debts because it hasn't got the capacity to pay the debt it's not allowed to pay the debt so therefore you know I go back to Jersey and say that's a completely meaningless statement for a world that doesn't exist a Scotland that would be independent that does everything that the UK does now but clearly wouldn't and which has a liability for something that it may not have incurred because who knows whether it would pick it up you know it is just make believe the existing data so that's why you have to go back to this question of saying what do you want if you were going to get meaningful information you would want information on both asset growth and liabilities to fund that as well as therefore this information and that goes back to the apportionment issue in the paper I discussed how to apportion some aspects of tax which is an issue on which I've done a lot of work I created the idea of country by country reporting which is now being used as the basis for potentially apportioning corporation tax liabilities internationally as the basis of OECD recommendation it's now law in 100 countries so you know it's I've been around this area for some time and it is done on the basis of estimates let's be clear about it because there isn't enough data to ever be certain you can apportion corporation tax accurately over international boundaries so a basis of estimation has been used and it's based upon where are the sales the only difficulty being is that Scotland doesn't know how many sales it's got why because there isn't reliable VAT data on sales in Scotland and it's sales to end consumers that matter here but it isn't there though that would also require reliable import data of course as well and export data to count those sales out of consideration there isn't the data so with sufficient accuracy maybe although I think we're getting close to it on the number of employees in Scotland I think that one is probably being resolved and the third indicator is assets and that isn't there so in very real sense the data required to fulfil the current Scottish economic policy which as I say makes sense because nobody would oppose those four things in that sense there isn't the data to actually fulfil that promise so just you know let's start the whole thing from scratch again what is required to actually make rational economic decisions in Scotland should be the question which is why I extended my paper beyond the six pages I was allowed which I apologise. Thank you. Andy Wight want to come in on these points before we move on to a question from Gillian Martin. Thank you. I want to ask a question about productivity data so it may not be appropriate this time. One of the key bits of economic data that is talked about quite a lot is productivity and I just want to ask John McLaren. In your paper you say that this is tricky to collect and analyse and that in order to make like for like comparisons with other countries a number of adjustments need to be made. I just wonder if you can give us any sense on the record about how big a job that's likely to be and whether we're in other words able to get better figures on productivity to make political debate and economic choices more meaningful? It is a key measure because it's likely to, over the longer term, make the economy stronger and stronger. However, if you're trying to compare the USA with France, with Germany, with the UK, first of all you need to adjust for how long people are working for. So it's not just, these adjustments include, so is it per person, is it per job, is it per hour, all of these things will give you different results. Then it's what are they working at, are they in manufacturing, are they in services, are they in public services, all these things have different projectivities attached to them. The reason you are being less productive may be because you're working longer than in other areas. For example, France has quite short working hours, the United States has quite long working hours and France is actually quite productive partly because it's got quite shorter hours and there's quite a large unemployment, so that means that people who are most productive are in work, so it looks like they are actually quite productive. One of the reasons that the productivity thing happened in the UK in the last downturn was that North Sea oil has come down a lot. Clearly hardly anybody works in North Sea oil, but they were making huge amounts of profits and all that disappeared. Also, financial services, which took a huge hit, again not that many people working it, but a lot of money being attached to them, so that partly explains it. The industry composition, you can then put in skills levels and issues like that, you need to adjust for all those to try and get to a like for like, but then again it's like, well, if you're adjusting for those things, should you adjust for them because actually the skills is important, so it's the skills that you need to address in terms of policy, but you've probably perhaps worked more in this area than I have. You talked about labour productivity, essentially, and that's one dimension, and even there an additional problem that you didn't mention is prices. We don't have prices, so we are, you know, an increase in productivity could simply be a reflection of an increase in inflation and we don't know what is behind it. The other thing is that more meaningful measures would be factoring in other factors of production, energy consumption, intermediates, and so total factor productivity is a better measure, but it is not being calculated. I mean, the ONS is starting now, they've written an experimental paper which came out in April 2017. Again, the major progress in this area has been done at the European level, the European Union is funding the MAP Compete project which brings together academics and statistical offices of many countries, the UK unfortunately is not part of that, and so there are big methodological issues and there are big data requirements because when we talk about productivity, I mean, the metaphor I like to give the students is like, you know, it's like peeling an onion, you know, you may even measure productivity correctly, but then what matters is what determines it, so you can identify approximate causes, but you need to be able to go to the ultimate causes to know what, in terms of economic policy, you can do about it, and that requires information which comes from within the black box of the firm. You need information, for example, about management practices. Again, the ONS has reacted to the World Management Survey which was produced by, which has been initiated by Bloom and Van Renen, used to be at the LSEs now in Harvard, and I don't necessarily fully agree with the spirit of the exercise entirely, because I think that environmental factors are important, but what they do is to identify and quantify elements of management practices which can then be used into total factor productivity estimates, because they think they look at management basically as a technology. Now, it may well be that ultimately at the end of peeling the onion, at the core, what you are left with are environmental factors such as agglomeration economies, but it is important to understand how, and I go back to your point about behavioural responses, how firms and investors react. One of the messages which comes out of this firm level view of the world is essentially that some of the macro factors that people think about like unit labour cost are less relevant than we like to think. Unit labour cost is not a very good predictor of a country's ability to export. In fact, it may well be the case, as some have suggested, that a low unit labour cost which results from a very high deregulation of labour markets, for example, may well be responsible for low productivity, because it incentivises firms to substitute labour for capital, or rather capital for labour. No, labour for capital. I go back to the point I made earlier. It is important to overcome this dichotomy between macro and microdata, because they are really very much connected. In terms of understanding the ultimate causes of productivity, we need to be able to go into the black box of the firm. Once you have unwrapped the onion, you are left with total multi-factor productivity, which is nothing tangible. It is innovation, it is the things that make economies very good. That is the tantalising thing of what countries are doing that well, and it is like management practices. It is R&D being used well and it is working with universities. However, it takes you to this intangible element that you then have to understand. However, if it was easy, every country would be doing it and growing quickly, and they are not. That is why international co-operation, and co-operation with academics, is essential. I want to move on to a question now from Gillian Martin. My question is actually related to what we are talking about, because one of the gaps that has been identified in quite a few of you is around what goes on in the household, what goes on with families, and I suppose that comes down to the data that you are talking about. We have a situation in which the Government is making decisions around policies that, on the surface of it, might look expensive, but could generate economic activity. Enhanced free childcare, for example, would be one example. A progressive policy or something that encourages the living wage. How can we measure what is missing in the data sets that are available to us to be able to look at how those policies have worked and how they have been able to stimulate the economy? You can make the case for more progressive policies, because that is one of the difficulties for the Government to say that, by giving families enhanced childcare, that is not a massive expense, but it is going to generate a lot more economic activity. Professor Montana? Well, I would say, I would go back to a point I made earlier, the linkability of data sets, because there is quite a lot of information about, for example, the BHPS has got a lot of information, the British household panel data has got a lot of information about some of these issues, and I'm sure there are other data sets which don't come to mind at the moment, but the important thing is to be able to link them up, because there may well be very clear causal links between some of the aspects you mentioned, and the productivity of the fair. For example, we have been thinking to set up a project looking at the impact of management practices on productivity, but through the channel of worker satisfaction, because management practices have got a lot to do with how the workforce is managing the fair, and we couldn't do it because we didn't have management data, and in fact we got in touch with Van Rien and to see whether they were prepared to replicate their study in Scotland, and a priori impression was that we wouldn't be able to have a significantly large number of firms to make the sample significant. Now, luckily, the UNS now has started with this management practices project, and maybe in the near future it should be possible to do something like that, but I mean, what you say is very pertinent. Clearly, there are links between different things, and that's why I say that it's important to have a kind of holistic view of these things, because if you start peeling the onion, the nice links that come out are endless, and it's important to be able to establish causality between the different tasks. I've got written in our papers longitudinal data. There's very limited data on a longitudinal basis of Scottish households, particularly in terms of issues like income, wealth and spending, and I'm interested to get feedback from the panel on that. John McClaren wants to come in and perhaps Richard Murphy briefly, and also Margaret Cuthbert, so perhaps John McClaren first. I wanted to come in on your previous point, if you don't mind. I think things like early years intervention, which has a lot of evidence behind it, that it will be good for in terms of prosperity and sharing prosperity. The trouble is, and I've been looking at this for quite a long time, the trouble is trying to find the money to put into it, because all the money at the minute is being put into primary education or secondary education or tertiary education, because that's politically, and to be honest, with a lot of the public. That's where the money already goes, and you've got to fight damn hard to take it off them to put it somewhere else, even though there's a huge amount of evidence. I mean, there is an issue about implementation versus picking the right policy, as perhaps we've seen recently in Scotland in terms of education, but these things can be identified. I think that one way of potentially bringing it into a higher profile and bringing it up with GDP is something that is sort of like concentrated on, is to have, as well as GDP, have another wider measure, which might sound more like social things, but things like health, education, environment, wealth distribution and things like that, and have that as a measure, perhaps an annual measure. A, it would be innovative so that other countries could look at it, but it also sort of says, it's not just about GDP, it's about all these other things, education early years, which will eventually, should eventually improve GDP. So if you can show that these other things are improving, that I've hopefully will eventually improve GDP, you widen out the issue to just being about, has GDP risen by 1 per cent or 2 per cent or 3 per cent, which is not really that interesting and it doesn't get you very far. But it's like trying to get that wider measure, still keeping a focus on economics to some extent, but highlighting the elements that goes in to GDP rising rather than just the final element itself. And I think there's a, you know, not many countries do it, so I think there's a, there's quite a good opportunity for Scotland to be in the forefront in an area like that. Good morning briefly, please. A brief comment, and I've made it the mention before, and it's in my paper, I've talked about a capital maintenance concept. That means a balance sheet and an idea that you're investing. Productivity is about the relative input of labour and capital. Some investment in early years may be a capital spend. It is designed to create longer-term impacts in the current year, in other words. But the current system of accounting just looks at income and spend and without any consideration as to whether there may be a benefit over time. But because of that absence, you can't make that sort of decision because you can't say the benefit will be three years. Hence, inside the accounting system, there should be a system where it is possible to recognise that spending now is for future benefit. And obviously that will be subjective. There will be differences of opinion on what does give rise to future benefit or not. But unless you've got that, you have the problem. And that then also means that you can actually look at current capital invested and I would just put it to you that at the moment Scotland hasn't got the degree of debt it should have because it hasn't had the capital expenditure at Scotland. We know that's true. So some of the apportionments are wrong because if we actually understood what is capital in Scotland, we'd realise there's far too little of it and therefore Scotland is being charged for capital that it hasn't even got, for example. But unless you have that extra dimension to decision making, you can't make informed decisions. Well, just briefly on that point that Richard has made, for long enough, the pair of us, there's another guy sitting beside me, Jim Cuthbert, for long enough we have believed that GERS is too static and we do need to place it in time and also it has to connect with other major statistics that are produced in Scotland and that's not happened. But if I can onto your point about family household money, I'd also like that to include geography. We can see quite clearly in Scotland that some of the cities do quite well but the areas that are close to it, like North Ayrshire, are really doing very badly indeed. Now there are statistics that we could be using pulling them together, which would give us a much, much better picture of what's happening in Scotland, rather than just looking at disability benefit. All the different things that are called support that's given, how children are doing at schools, how many are getting into higher education. We now need to do what you call a multivariate analysis in this to try and find out how best to spend our money and how that money has been used in the past and whether it's been successful. We actually have the data. We could be spending some big effort, academics could be spending some big effort on doing a study on that and it would be extremely useful and help you with the issues. I agree very much with what John Broughton said. You need to look at other aspects, as well as children. The social matters really matter for the economy. Just to address Gillian's question, it's less a question about what economic data is available to evaluate those policies. When you start looking at the policy, having a very clear idea how you're going to measure it and looking at what's available, you might collect some new data whilst the policy is being rolled out. One of the biggest flaws we have in Scotland is not setting out how we're going to measure things once we start rolling out a policy. I'm going to mention Andy Wightman here briefly. There was a good paper produced by Andy on the fringe and whether or not people who rent out their flats should be paying tax. Now that, assume it might not have been, maybe it was some sort of highly talented researcher behind the scenes pushing the buttons, but it was an elegant, clever, really good piece of research. I don't necessarily agree with the conclusions, but actually the process, you could almost say, why aren't we doing that for very large government programmes? It's less a question, I suppose, about what statistics are available. Having the political will to say, we have a genuine interest in saying, does this work or not. Dean Lockhart wanted to do a follow-up there, and then perhaps we'll come to John Mason for a last question. Just to wrap up on this need for more holistic measurements, John McLaren mentioned the index of social and economic wellbeing in his paper. I think that there seems to be some consensus that we don't just look at GDP, we need to look at a broader scope of measurements, and the data seems to be there. How can we take that one step further? How can we further embed and bring into the mainstream measures like the index for social and economic wellbeing so that we look at policies in the round in terms of the impact on education as well as the economy? I think that publishing it regularly and being behind it so that you, as a Government, say that we take it seriously so that when it is published you have a press conference or whatever to say and we're going to do this, that or the other. One of the things that came out of the one that I published the other week was that the Scottish life expectancy remains outside of Eastern Europe the worst in any developed OECD country. As it has done for a number of years. In many ways, that is the worst aspect of Scottish livestock, the Scottish social economic environment. It hasn't improved over the last 10, 20 years probably. Why has it not improved? We're concentrating on the NHS because that figure isn't really highlighted that much. Why is it important to the economy? If our life expectancy is poor and our healthy life expectancy is even poorer, that probably relates to poverty as well, then those are some of the issues that are explaining partly what could be done better to improve Scotland's growth rate by improving health, not through the NHS but through preventative measures and areas like that. Although it doesn't seem like the economy, it is the economy, but you have to give it a high profile and share it. It's not the outcome, which is GDP, it's the core things that are feeding into the outcome. Clearly, it's difficult in areas like the environment, which you might want to include as well, but it's not impossible. Those things do move quite slowly, whereas the economy moves up and down quite quickly, life expectancy can move quite slowly. I'll throw in the last 10 years or so, the Estonians have gained over four years of life expectancy, which is pretty good. Do you mind if I add to that? I think that what John said is absolutely right. We've got to, however, look at the whole of Scotland as well, and there are areas in Scotland that really have just been left and their hearts pulled out of them. When we're devising a policy, we've got to look at other aspects such as transport on the way through, which seems to, relative to what has happened in the south of Ireland around itself, we've missed the boat away. Our policies have to be inclusive of the other aspects, not just health but transport and good communications throughout Scotland, so that we're one society, rather than bits that have been left to die. A brief comment from Richard Murphy and, I think, Catio Montana wanted to come in as well. This goes right back to the core of redesigning the data. If you're a company, you think you're maximising profit. You may not be, but that's what you think you're doing, or you want growth or whatever. You choose your indicators, your key performance indicators, which are going to be the drivers of your business, and you create a measurement system to provide data to say are you succeeding or not. Actually, before even redesigning the information system for Scotland, you've got to decide what are the key performance indicators, which are actually going to be driving this. That is a political choice. That's why I said all data is political, because what you choose to measure, how you choose to measure it, is a political choice from the beginning to the end. If you don't choose the right KPIs, you're going to come up with data that doesn't suit the purpose. If there are no further questions from committee members, then that is our time today. Thank you very much to all of our guests for coming in. Thank you very much. We'll now move into private sessions, so I'll allow five minutes for the gallery to clear. Thank you.