 Hei. welcome to the second meeting of 2015 of the finance committee of the scoi parliament. Could I please remind everyone present to please turn off any mobile phones, tablets or electronic devices. I would like to welcome to the meeting, and indeed to the committee our new member, Richard Baker, who has replaced his colleague Michael McMahon. I would like to invite Richard to declare any interests relevant to the remit of the committee. I would like to draw members' attention to my report of interest. Ie ddweud i gyntaf i'r unidi Busan. Okay. Thank you very much for that. I'd like to remind Richard that the initiation video will be at midnight. I was looking forward to that super. I'll just check my diary with Claire and Apple Mae. My first item of business this morning is to decide whether to take item 7 private and estimate and are members agreed? Yes. Members have indicated their agreement. Our next item of business is to take evidence on the community-charged debt Scotland bill. This one could do separate evidence sessions. O 우리는 i utilise unrhy Zhang, angen i fy yаз tu sydd hyn sidesŷnt gŷwyrあります. Awr Gruffyddiaeth y Cymru yn gweithio fittedig dd!, ti'n gwybod o enaldig ar dda. Ond rwy'n gwybod felcc señorl ithae, byddw i yr D rodd finestr Lleil Starddol cyllid。 Wrth gwrs' dddechrau, yr ddŵr bydd y cacio ag ein spain o hyfforddiad ar gyfer cychwyn館 ddechrau. C notifications yn rhan gyd-rif Members have copies of all the written evidence that's received including Glasgow's, so... ...without further ado, I'll start with a few questions and then we'll move on to open up the session to colleagues around the table and hopefully other local authority colleagues will arrive before too long. The Glasgow submission is a fairly short but perfectly formed submission, it's It's less than one page, but there are some important points to it. First of all, on the question that was asked, which is what is your view of the purpose of the broadlet, are you supportive of it? I have to say that it does seem in political parlance to be what I would call a body swerve in terms of whether or not the city actually supports the bill, so I'd like a wee bit of clarification on that first of all. Thank you, chair, and good morning to the committee. In terms of the response, and I understand that you will all have a copy of that. In terms of the council's view on this, our whole priority over the last, particularly the last 15 years or so, has been to maximise our council tax collection levels and our whole debt policy is geared to that, and it's also geared to what we call breaking the cycle of debt. You'll have seen in the figures that are in part of the information at this committee that our actual levels of community charge collection are relatively low, because we're very much focused on collecting our council tax, and that would be the issue for us. I'm still not really sure if Glasgow thinks the bill is a good idea or not. It has a formal position on it through committee, for example, and, as I said, we are very much focused on helping the current taxpayers. We've just been joined by Councillor Kevin Keenan of COSLA and also by Gregory Colgan of Dundee City Council, both of whom are delayed, no doubt, because of the polling weather conditions. Welcome to the committee. It was just the first question that I asked, and it was basically—I just asked Lynn whether Glasgow was supportive of the bill and you would have heard her response there. I'm just wondering if you can say whether or not what COSLA's broad view is, because we don't have a submission from COSLA, Mr Keenan. First of all, please accept my apology for being late. The weather has been a bit severe over the past few days in Dundee, and God normally just puts rays of sunshine on Dundee, as you all well know. COSLA's real issue is that they didn't particularly see the read for legislation. Obviously, as regards the bill and the write-off of the debt as agreed, don't particularly—or there got some concerns as to whether there's any additional consequences with individuals who feel that they've paid their tax in good faith and here what are now some years later with individuals who wouldn't be having their debt written off of them. So there's some concern there, and as to whether there's a legislation that has any other consequence, hence the reason that COSLA was not overly supportive of feeling the need for legislation. In Dundee's submission, I quote and communicate in the bill to the public, it's important that this does not send out a message that is linked to non-payment of older council tax debt, which is still being pursued. Dundee City Council is a strong track record of collecting prior years council tax. I wonder if you can expand on that a wee bit and tell us what concerns you actually have in that regard. I think that reflecting the submission, the concern that the council would have would be that, with the bill, should it go through, that individuals think that it's acceptable not to pay historic council tax debt and something similar may happen in the future. With our current corporate debt policy, what we aim to do is break the debt link. Our focus is obviously on current council tax, with any arrangements then going to prior council tax and subsequently community tax debt, but we would hope that individuals would still pay and continue to work with the council to ensure that arrangements are fair and we can work with them to recover council tax and also break the links to future debt and poverty. In that regard, your comments were very similar to Glasgow's. One thing that I thought was interesting is that, based on the figures of Glasgow Council, it doesn't believe that the peak in voter registration record ahead of September 2014 can be attributed to people with community charge debt re-engaging after a quarter of a century. Of course, that's important because that's one of the reasons that's given for bringing forward this piece of legislation. I know that you've given me a submission, but I'm just wondering if you think of as a way more information on what Glasgow's thinking on that and what Glasgow believes. Was it a reason for so many people engaging who had not been on the register for years? In terms of our register, we have made it a priority, particularly since 2009, to increase the register in Glasgow. For example, in 2009, 89 per cent people were registered that you would expect to be registered. By September 2014, that was 97.4 per cent. However, between September 2013 and September 2014, we had an increase of about 2.5 per cent. It was about 11,000 voters, and 10,000 of those were 16 to 17-year-olds. It's our view that, until then, people were engaged in the process that they were registering, even if they might have had community charge debt. For us, the last big surge was around for Glasgow, and our figures show that that was for the 16 to 17-year-olds, which we had a very high level of registration. Councillor Keenan, I know that you don't have the submission before us, but we have a number of submissions from other organisations, member organisations of COSLA. The director of finance of Highland Council commented on the potential for what he called those unintended consequences. Is there any unintended consequences that COSLA are concerned about with regard to this legislation? I think that the unintended consequences are, do people consider that someone is going to come along and write off debt that they have at the moment? I think that the answer that Mr Cogan just gave you in relation to Dundee's concerns is very much that as well. As people are seeing pressures on their home budget and their living standards as they are at the moment, and I think that if we could get away with not paying a bill, chances are that that would be the case. I think that the unintended consequences are, would it affect the collection levels that we have at the moment? We wouldn't want to see them getting any worse considering the pressures that local Government is under with finance at the moment. COSLA appears to have accepted a full and financial settlement of £869,000 provided by the Scottish Government. That was done on 21 November. Is that your view that that is a fair settlement? The commission that was COSLA was requested in the figures that came in for a COSLA point of view. I think that we see that as a fair settlement. Those are the figures that were asked for, and those are the figures that were achieved. It seems to me that Ms Brown that you have said that it is our understanding that the calculation of the financial settlement flex amounts intimately to COSLA from individual accounts as to the impact of the bill. I will surprise at that, because Glasgow City Council is only getting 2.3 per cent of the settlement figure, but when you look at the amount of money that is owed to Glasgow City Council, 29.4 per cent is owed to Glasgow £125 million, yet the settlement figure is £20,000. What is Glasgow's view? I was surprised that Glasgow seemed to be quite happy with the COSLA settlement figure. We give a figure for the city, for ourselves, and that reflects the payment arrangements that we have in place—I think that it is about £2,000 to £3,000 a year—that we get in through existing payment arrangements for community charge. Those payment arrangements have now been set aside, as such, between £10,000 to £20,000. I think that COSLA has gone in with a higher figure of £20,000. In terms of the dead-out standing, as we have said, our policy, I mean, since council tax has come in, is to focus on that. When council tax has come in, the level of payment in Glasgow on reflecting the community charge was about 70 per cent, so about 30 per cent. That figure that you will have seen of £125 million reflects 30 per cent non-payment over time of community charge. We really focused hard on getting our collection levels. They were at 73 per cent in 1996 up to nearly 94 per cent line of council tax. In terms of resources that you would put into following up in community charge, it is really time-consuming and costly. We focused on the current council tax and on encouraging people to start paying tax again, because they had developed a process of non-payment in Glasgow, and that has been reversed. Mr Keenan, the financial memorandum says, and I quote, that recovery of much of the debt is now prevented by practical considerations and by the law of prescription. How do you feel that this is something that we really should be drawn a line under, or do you share the view of large accounts that I quote, the collecting authority? In this case, local authority should be empowered to use all available information and means to seek collection? Individual authorities will continue to talk for themselves. Obviously, because they are happy to accept the agreement as it stands, we have made the reference of, I do not think, the need for legislation and, again, obviously the potential for unintended consequences. In general terms, people were happy to accept the offer that was made. I will get one final question and I will open the session out. It is just to go back to the settlement. Dundee is getting 35.1 per cent of the settlement figure, but it is only 2.6 per cent of the outstanding. How did you manage to wangle that? The figures that are provided by Dundee Council to COSLA reflect the current arrangements and current income that the council is receiving for arrangements that are in place to community charge. Albeit those figures have reduced, we still anticipate to collect around £60,000 a year over the next five years relating to community charge. That is arrangements that are currently in place. Thank you for that. I am now going to open up the session. The first person to ask a question will be the deputy convener, to be followed by Mark. Thanks, convener, very much. Just to follow up on that point, it is quite interesting that Dundee is getting quite a lot of money. Is that something that has been constant throughout, or have you put in a lot of effort in recently? Can you explain to us, is that through earnings arrestments, or how is the money coming in? The value of income that we have received for the community charge has reduced over the last five years. In 2009-10, it was around £150,000, and it has reduced to currently $60,000. Those arrangements are arrangements that are on-going and are mostly relating to people who are paying us some of money towards the debt. There are very few that are in relation to earnings arrestment. Ms Brown, why is Glasgow different? Had we tried harder earlier, are Glasgow people just more reluctant to pay, or is there a difference there? We have taken in about £1 million since 2004, and that has reduced over the last three or four years, so we are at around about £2,000-3,000, because people have paid off their debt and there are some remaining. I think that it is because our focus really is on the council tax and on breaking that cycle of debt, and that is where our focus has been. Are the people still paying? Are they coming in and paying cash, or are they coming off their wages, or off their benefits? I have that detail here, Mr Mason, on the payment arrangements that they have for the number of people. I cannot provide that. I do not have that level of breakdown here today. That is fine. Is the problem for Glasgow and D or anywhere else? We have not known where the people were, so there are people out there with lots of money that could be paying it, but now, with the voter registration potential, we could have found out where they were? Or is the reality that most of that money is owed by people who have no money, and there is very little chance of them paying it at all? All those individuals that did not pay, and many years ago decided that they would take themselves off any kind of voter registration because they did not want to be tracked down to pay, probably did not have the money at the time to pay either. Individuals that were in employment, good prospects, honour occupiers or whatever had a different scenario. I know individuals that said at the time that they would not pay and they paid up eventually, and those are the type of individuals that are unhappy with the fact that there is a debt being written off for someone else, but that again is a potential unintended consequence. I came through in the train this morning with somebody who had not paid to start with, then did pay, but also fully supported that they felt that this was the right thing. Do you think that there was potential with the new voters to really start to get a lot more money in from the community charge if we would pursue that? I think that it is hard to tell what type of voter is turned up by that type of breakdown of what age groups and whatever would be the one. I think that you asked that one earlier in Glasgow, and they are unable to say what are the individuals that turned up. Is it often age group that have been away for 20 odd years or off the electoral roll for 20 odd years? Is it new individuals coming on, 16-year-olds, often age coming in to vote for the first time? Those are the unknowns to us. I do not have that level of breakdown that would suggest that it is all based on a historic debt that we have seen people coming on. People obviously may well want to see change and hence the reason they are signed up, or there was just that level of campaigning going on that felt the one to be a part of it. Let us hope that that continues. For us, as I said, the voter registration has been increasing since 2009 when community charge was in place, and for Glasgow the increase was 16-17-year-olds. I think that the difference was the voter turnout, which was much higher, but the actual voting registration had been increasing regularly since 2009. There has been an issue that the convener already referred to that if people get into the habit of not paying something and then, hopefully, eventually it will go away, that could knock on to the council tax. I suppose that the counterargument to that is that almost everybody thought that the poll tax was a bad idea, apart from Mr Brown, obviously, and whereas people think that the council tax that we can live with, do you think that people make that differentiation or do you think that there is a real danger that we could go down the road that this will actually put people off paying council tax? There are many changes coming in the direction of people's household budgets. Individuals on benefits have seen a bedroom tax introduced. There is a lot more individual pressures on individual households. There are food banks now, and there is a lot of reason to believe that people are struggling. I think that that in itself may have people off the opinion that that might be one that we will be able to walk away from, or that it will be a debt that we will be able to walk away from, and hence the reason that we believe that there could be that level of consequential loss to council should that be the case. I would not like to see it because, obviously, there are a lot of vital services that are delivered by council, and that would be the message that I would be trying to put out to people, which is please pay, because those are the services that it delivers for you and your community. My final question is not one that you can answer, but do you know how, if we take, say, the utility companies or shops when they are pursuing debt, how long they go on pursuing it? Would it be 20 years as well, or do they go on for longer? Have you any idea about that? That is maybe a fair question. I have no great amount of debt that I know of. I am probably the wrong person to ask, but I am sure that organisations could get closer to giving you a good answer on that. Is there any idea not that that would not be your area of expertise, I assume? In Glasgow, we spend about £3.5 million a year on financial advice through law centres, money advice and sensitive advice bureaus, and our experience is that people do not like being in debt. It causes mental health issues as well as other issues. That is why we invest in those services to support them. I cannot comment on the utility companies and so on, but I know that, in Glasgow, it is not taking lightly getting into debt. The comment was made around the possibility of establishment of precedent in terms of if the debt is written off, it could give the impression that other debts would be treated similarly. A note from a number of tables that have been provided to the committee by the Parliament's information centre is that 10 local authorities have ceased collection of community charge debt. Presumably, they have had to square that circle locally. Has any information been sought by local authorities or by COSLA from those councils around the impact that their decision locally to cease collection had in regard to council tax debt and how they square the circle that has been suggested by some of our witnesses? That is because there is no try to gather that kind of information as to what affect non-collection or a decision not to collect in any area. Obviously, we respect the fact that individual local authorities make the decisions in their area, but they best suit the individuals that they represent, as that is how we operate as an organisation. I suppose that we don't need as much as being a council that has always seen itself among the higher of value to council tax and has always tried to pursue the debt. We have a press in the area that individuals in the area would put council under pressure to make sure that outstanding debt is looked at and tried to gather up fully in agreement with what was said from Glasgow or Linder in relation to, I don't think, people like being in debt. I think that it adds another pressure on them, and local authorities do what they can to make sure that people don't build debt. Unfortunately, some people don't engage in its homes. I don't know any further about the local authority. Any other local authority on the matter? The figures on the income from community charge collection that we have been provided with show dramatic tail-offs in some local authorities' Glasgow being the one that stands out where £550,000 was collected in £2,000, £3,400 and £2,000 in 2013-14. I am being interested to explore a little bit further. You mentioned the costly process that is involved. Is Glasgow in a position where it is spending more in pursuit of community charge and administering a collection of community charge than it is taking in on an annual basis? We are taking in around £3,000, but there are payment arrangements, so the administration cost is very low for that. That evens itself out as such. As I said, you have mentioned the figures from 2003-04 when we decided to look at our debt policy and to focus on council tax and to help people break that debt, and those figures reflect that. To look at the breakdowns of total and uncollected community charge—obviously, that is the total sum that goes uncollected—is there a relevant figure that is held by the local authority in terms of the likely recoverable community charge? I imagine that some of that debt is held against people who do not have any idea of where they are, and therefore at present it is not debt that you could realistically say was recoverable. Do you hold similar figures in either local authority of the total amount that is owed versus the total amount that you could reasonably assume to collect? The higher you would show that it is through your accounts where you would have a provision for that collection and 2003-04 again, we decided to write that down and focus on council tax, so we do not reflect that in our books. Finally, a number of submissions have spoken about the existence of sporadic and informal payments, so where you have formal payment arrangements at present where individuals know that you are going to get that income, there is the potential that it is argued for individuals to arrive at the door of the council if you will and say that I am here to clear my community charge debt. There has been an argument that that should be factored in in terms of the way that the settlement has been calculated. Do you see any realistic way that that could be calculated, or is it a method that you think ought to be used by the Scottish Government when it is coming to the calculation of the settlement? As reflected in our submission, we believe that the settlement is a fair settlement. It would be extremely difficult, particularly for Dundee council, to in any way estimate what the likelihood of sporadic payments would be for individuals who may appear in the scenario that you have outlined. That would be the same from Glasgow? That would be the same from Glasgow, yes. Do you need to follow by Gavin? I wanted to ask about putting the debt in context in as much as comparing with other debts. I mean, I have been a councillor and I know that at the end of the year there are other debts that are written off, because the councillor has decided for whatever reasons, different reasons, that they just never, no matter how much money they throw at sheriff officers or anybody else, they are simply just not going to be paid. In context of outstanding debt that councils have, is the poll tax element massive? Is it the largest part of the debt? Is it the biggest debt that is outstanding in councils? Because it has been written out of the books, there is no figure sitting on the books, which is the issue to do with debt. Can you get that money back? As I said, it has been written out of the books in Glasgow in 2003, so there is no comparison of such, although that £125 million for Glasgow is a significant figure, but that is not sitting on our books. Do you think that that is the same for most councils? Do we know from COSLEC? In our position again, the debt is not sitting on the books. Again, going back to our submission, our focus would be on council tax debt, so to provide that analysis in terms of the proportion of which the community charge relates versus other individual debts. That would be a quite an extremely difficult task to do, but certainly Dundee's position would be the same as Glasgow, that the debt is not reflected in the books. I think that we could probably fairly assume that that would be the case for every council. In essence, as far as the annual accounts are concerned, the poll tax will have in effect been written off. I cannot comment on other councils, but I just cannot comment on their books. The difference between England—one of the things that was thrown up at the time of the fear of suddenly people registering to vote and then being challenged or chased up for poll tax that was highlighted was the difference between England and Scotland, and we seem to pursue debt for a longer time. Do you feel that this merits legislation or that there could be some kind of amnesty that, put in context, might be even more agreeable to the people who feel a bit aggrieved that they somehow were good citizens and have paid their bill and look what happens if you do not bother? I think that the fear is that that is where it gets to. Obviously, in the local government that is hard pressed for finance, we look towards maximising the income that we have and clearly we look towards other ways of trying to maximise our income that we have seen any kind of debt right now and often. We would not want to see the wrong message being sent out to individuals, so that is a bit of a fear. It is an unknown at the moment. We will just have to see what that plans look like over a period of time. However, if you are reducing the number of years that you live with the consequence of holding the debt to knowing that it falls off the end of the plate somewhere, that would be another goal for some individuals as they may not wish to pay things. I know that one or two of the evidence papers that we have from other councils are saying that it does not merit legislation. If you have a view about that, if you feel that there is a way that we could be going forward with this without legislation and still writing off the poll tax debt. I think that the councils have agreed to accept the deal that is done by the Government as far as I am concerned, and it is forgotten now. However, as there is a need for legislation, there was a concern at COSLA that it is unnecessary, and they would not want to see any legislation that affected anything else. COSLA agreed to work with the Scottish Government to make sure that, hopefully, that would not happen. Perhaps it is an unnecessary parliamentary time. The number of witnesses giving written evidence has made the point about trying not to link it to older payment of council tax and bringing their concerns about that. Dundee and your submission says specifically that it is important that this does not send out a message that is linked to non-payment of older council tax debt, which is still being pursued. What has been the Government response to that issue being raised? I am not sure that there has been any response to that. It is the weather director of finance that has received anything that I am unaware of, but we could check it out and see what else there is. Do you have any but it is possible that it has been? Has Dundee had a formal response to that? Formal response has been received by Dundee City Council. I know that Glasgow did not specifically raise that in the written evidence here, but are you aware of any response to that concern that has been raised by a few councils? I understand that that is part of why we are here in front of a committee today, so a committee can assess that. That would be part of the Government's response, is my understanding. Secondly, in relation to the issue that Mark McDonald raised, he referred to a paper that we have been given by the information centre. It is page 16, but I do not know whether you have the document, but if you do not, it does not matter too much. He asked the question about how much of that debt is realistically recoverable. I want to ask a slightly different question, and it is to do with prescription, because if you take, we will just take Dundee, for example, just because obviously you are here. According to the table, uncollected community charge, as at 31 March last year for Dundee City, is just over £11 million. Now, you are not sure how much of that is recoverable or not, fair enough, but that is the uncollected charge. Is some of that £11 million invalid due to prescription, or is that likely to be the figure having ignored the stuff that has fallen due to prescription? Is the £11 million, while it does not be a realistic collection figure, illegally due figure or has prescription meant that that £11 million figure should be reduced anyway? Do you know about that? For Dundee City Council, the £11 million reflects the value at the end of March 2014, which remains uncollected. None of that debt has been prescribed, because the council took a decision to warrant that debt, so all that debt at present is still collectible under a valid summary warrant. On an annual basis, Dundee's position, anyway, is that each year you would suggest that a certain amount has actually been prescribed and therefore it should not be included in that figure? That in itself would be a difficult task to determine that value, because none of the debt at present is prescribed, and if an individual were to make contact with us, then the summary warrant would then start from that point. It is 20 years of uninterrupted acknowledgement. Is that the same for Glasgow? The next question. Obviously, the process has happened fairly swiftly. The first public pronouncement was 2 October, and we are already looking at the stage 1 process here, or just in advance of the stage 1 process. What has been the process of engagement with Government over the objectives of the bill? Obviously, there was no formal consultation, but the Government is saying in its policy memorandum and explanatory notes that there has been quite a lot of engagement. What has been the nature of that engagement and how, what sort of depth of discussions have they had with either COSLA or your individual councils? The conversation and coming up with a settlement and reaching agreement has taken this meeting longer than that particular conversation had. Obviously, the First Minister at the time made an announcement that he was going to do. COSLA is broadly in agreement. There has been a canvassing of individual authorities as to what the debt was, and then we had a meeting with Darren McKay and his officers myself. I think that it was David O'Neill from the president of COSLA and our officer of COSLA, and we agreed that that was the settlement figure. That is what individual councils have seen as the debt that, based on the criteria that they were asked for, was where it was. The conversation has been great and enormous with Government. That was at the reaction of travel. Just for clarity, you said a fairly short period of time, shorter than this meeting, for agreeing the amount. In terms of engagement over the policy objectives of the bill and potential unforeseen consequences of some of which have come out today, what level of discussion took place with Government on that? There seems to be an acceptance that, if there was an unforeseen circumstance, it would be back around the table having some level of negotiation as to the way forward. If that had a negative effect on the collection of council tax, then we would be back looking for support from Government to make sure that we were able to pay our bills. They have underwritten that effectively. I believe that the agreement was that we would get back around the table should that happen. We have raised the fact that individual groups may well form and say that, in good faith, we paid. Where is their discount? Are you giving us some money back? We will not see what is happening. I know that there has been noise in the press, but I am not sure that councils have had anything presented to them as yet. In terms of discussion or engagement with the Government, is that similar to for your two individual councils, or was it all done through COSLA to your knowledge? It was done through COSLA. It was all done through COSLA. Last issue to explore is the—I think that you have given the mean done—that you are obviously not unhappy with the numbers, as such, as the convener alluded to. A point that has come through some of the papers, but I do not think that either of your individual papers, but you may wish to comment on it. Other papers say that the amounts agreed reflect what were existing arrangements at the time of the information being given. Some councils, or some witnesses, have said that that was a position of existing arrangements, but because of the information that we have now—electrol rules specifically—there is a possibility that we could have collected higher. We do not put figures on it, but we could have collected more. Therefore, the figures should be increased to reflect that. I wonder whether COSLA or your councils have a view on that. Are there arrangements that could have been set up if the bill had not been brought forward that would have increased the amounts that were collected? For us, as the convener said, our electoral register has been increasing. Since 2009, our major increase is 16 to 17-year-olds who would not be impacted by this, so we did not see the link. Dundee's collection rate was relatively high anyway. Was there scope for a greater collection based on the electoral roll-up? Was that de minimis? Dundee council did not see any potential scope for increasing the collection within community charge due to the electoral register information. I think that some councils are intimated to COSLA that they felt that there were other ways where they were achieving an income, albeit that might not have been enormous. Based on the criteria that were asked for and information gathered, those are the figures that COSLA dealt with. I am not sure whether those individual councils are overly unhappy because it was not a debt that individuals had paid up and agreed that there were other means of pursuing that debt, which we are now accounted for here. I turn briefly to the issue of process, Mr Brown, because whatever the merits of the policy here, you said that there have been questions about whether legislations are the right way to progress it. Before the announcement was made that the Scottish Government was going to introduce it as a bill, prior to that announcement, was there any consultation with COSLA about that proposal? To my knowledge, COSLA received the phone call five minutes before an announcement was made or maybe five minutes after an announcement was made to say that this is what was likely to happen, so there was no level of consultation about that. It was a direction of travel that the Scottish Government or COSLA felt that they needed to go. I think that whatever the merits of this process, whatever the policies, I think that on a consultation level that is deeply unsatisfactory. However, returning to the graphs that we have on the table and financial data, Mr MacDonald made the point that, in case of a number of local authorities, in the years from 2003 to 2010, there was quite a lot of collection of debt and, after that, it fell off quickly. Is it fair to say that that is because of issues of practicality rather than policy decisions by councils of whatever political complexion, not to collect that debt? Or was it actually a policy decision or did you have an overview of the main driver for why councils stopped collecting debt, to the extent that they had been? From Dundee's perspective, to my knowledge, it would be to the change in focus moving to a corporate approach to recovery and focusing that process on breaking the debt cycle and for payments and arrangements that were coming in, focusing them towards current year payments and also due to arrangements that may have been in place for community charge that had come to an end. The driver was collecting debt in a different way, or dealing with debts in a different way, rather than saying that we are going to give up chasing this debt at all? Yes, that would be my assumption. My final question is, how many local authorities have, up to this point, been using information from the electoral register to chase up outstanding community charge debt? Has it been happening routinely of many local authorities doing it? Or is this just an issue that came up with the referendum? Any of them have been particularly using it, but... We haven't been doing that in Glasgow and I can't comment on other councils. They haven't been using that information in terms of community charge debt? No. And presumably, actually, the vast majority of local authorities have not been using that to electoral registration information to actually, as part of their policy in terms of pursuing corporate debt. When you look at the figures that are being produced, quite a lot of councils have stopped pursuing the debt, so I assume that is the case. I haven't really heard of the law of prescription until this came up, and I'm not entirely sure if I totally understand how it works now, but Gavin Brown has covered some of this already. Is it true that all the figures that are being presented is all debt that could legally be collected so that there isn't any of it that would be covered by the law of prescription? From Dundee's point of view, the figures that are given there, I think that Greg suggested, is about a five-year figure on the current level that we're collecting, on agreements that are in place. Dundee's debt, for some of the figures that I got when we were having that discussion with Derek Mackay, was that I was surprised that Dundee only looked for £300,000. I thought we'd be looking for a lot more. Having had discussions with finance officers and director of finance, I can understand how that figure was reached. I thought it would be a much higher figure, but I accept that over that period of time individuals or debt will be finished for some. The length of time becomes difficult to continue to accept that you're going to get that level year on year. I know how to display migrants of the law of prescription here, but if somebody disappeared from the electoral register in 1991 and then suddenly appeared again in 2014, would it be possible to recover from them if they disappeared for that length of time? If no approach had been made to them in that time because they disappeared from the register, would that not be covered by the law of prescription? Or am I misunderstanding it? To my knowledge, it would be dependent on when the summary warrant was taken out and whether or not there had been contact from the date that the summary warrant was granted within that 20-year period. It would depend when for some debts the debts may have been re-warranted. That came up when the bill was introduced and people were talking about it, but I just wonder practically whether it's very relevant to this debate or not, or should we just forget about it? I've been missing for 23 years. It's not made any contact with council whatsoever. There's not been any kind of warrant in place or whatever, but the chances of ever making any pursuit of that is not going to happen. Of course, in the discussion of the bill, the law of prescription got mixed up in some people's minds with the situation in England where my understanding is that debts are written off after 10 years, so I think that that was something brought in by the last Labour Government. I can't remember what the reason for it was, but it was English on the legislation, so I had no reason to know. But, Ted, does anybody see any virtue in us copying the English approach in terms of a time limit for all debt owed to councils? If the Scottish Government's going to stump up the money, but I'm not sure that you've got the finance even with the underspent to make that level happen. Thank you very much. One of the jobs that I have as convener is to do this kind of sweeper role as well and ask any questions that may have not been asked by colleagues round the table. I've just got a couple really, a lot of more of my questions that are going to be for the cabinet secretary, but the first question I'd like to ask is, I mean, we keep hearing about this £425.3 million, which is outstanding. Is that £425 million a cash figure or is it being increased to take any account inflation over the years, or is that the actual sum of money that's owed? Do you know what the position is on that? Is that interesting? The fire has people here. Is it community charges made up of a number of things, including surcharges, and I understand that that figure reflects the total cash that would be due as at the date that was given? Understanding as well, actually. I just wanted clarification on that. The other thing that I was going to ask is, how realistic is this debt? Over 20-odd years, a lot of the people who will have owed this money will have simply passed away, a lot of them will have emigrated to move to other parts of the United Kingdom or whatever. How much of it is real in terms of recoverable because the people are A, still alive, and B, living in a Scottish local authority? Is there any assessment being made of that? Do we know, Kevin, from Dundee's point of view? I don't think that there's any assessment, but if some council has acted differently and Dundee's kept a focus on it, then there's no reason to believe that other councils shouldn't have had a similar figure in relation to what Dundee, especially if you're looking at, you're trying to judge of what the areas of multiple deprivation would be. You would have expected Glasgow to be truly a fast for a much higher figure than Dundee's obviously agreed to settle on. He's only bringing in just over 0.5 per cent of what's owed, so it's not really big bucks, really, if you think about the money that's allegedly owed on paper. Of course, as I said, somebody might have died in 1995 and they're still effectively classed as having owed that. The other thing that I'm going to say is just how much is being spent on collection at the moment. I mean, for example, Dundee, how much are you spending to collect that £60,000? I think that it's quite interesting. I mean, we're looking at £327,000 coming in, but I'm wondering how much has been spent collecting that £327,000. I think that must have a significant impact on the fact that 10 local authorities have just decided not to bother. Do we know how much it's costing? I don't know the exact figure for the cost of collection in relation to community charge. It will not be a high figure, but there will be some resource that will go into collecting the figure that has estimated to be £60,000 for this year, but I don't have the exact figure with me today. I appreciate, Linda, what you said about Glasgow earlier on, about the fact that Glasgow is focusing on ensuring that the council tax is being paid, but it's one of the reasons why Glasgow is not really pursuing this is the cost to pursue it? It's a mix of the cost and the practicality because of the time. The regions that we have in place have just run themselves. The cost is very minimal. Is there any overall figure, Kevin? Any kind of ballpark figure about what it's costing per pound brought in? I mean, I would doubt very much whether any council's got an army of individuals that's solely focused on trying to bring this in. Even for the point of view of Dundee, I mean, as a local councillor in Dundee, I would be saying, why have we got that army of people a long time ago? We would have forgotten about the collection if it was costing an arm and a leg to collect it. The fact is that we have a number of people that work in debt recovery, we have a number of individuals that go out and support and try to get people out of debt and guide them through welfare reform, welfare rights individuals, citizens advice and a number of other agencies in the city. We've focused well on that, like other authorities, of done to try to make sure that we guide people through the debt and make sure that we get them out of it, look for ways to maximise their income as well, which is obviously important too. We haven't got an army of people across local government collecting and focusing on a debt that's 20-odd year-old. It's agreements that are in place and that trickles in, albeit at a small amount. I'm just about to draw the session to close. I just wonder if any of our witnesses have got any further points they want to bring to the attention of committee. You're all happy? I'd like to thank you very much for coming today, particularly in the appalling weather. We really do appreciate you coming to committee today, so thank you very much for that. I'm going to call a recess until 10.40 just to allow members to have a natural break and a lot of change over all witnesses. Our consideration of community charge debt Scotland by taking evidence from John Swinney, Cabinet Secretary for Finance, Constitution and Economy, the Cabinet Secretary is accompanied for the site and by Scottish Government officials, Jenny Brough, Graham Owenson, Laurie Barry and Colin Brown. I welcome our witnesses to the meeting today and I'd like to invite the Cabinet Secretary to make an opening statement. On 2 October last year, the former First Minister announced the Government's intention to bring forward legislation to ensure that councils can take no further action to recover ancient community charge or poor tax debts. With the co-operation of the parliamentary authorities, we've been able to bring legislation forward on an expedited timetable so that legislation can be enforced for the start of the next financial year. As a result, our proposals have not been subject to full public consultation, but we have consulted with COSLA and local authorities who are the only bodies that could be adversely affected by our proposals. Informed by that consultation, the financial settlement that the Scottish Government will make to local authorities to reflect the winding up of community charge debt collection will reflect the small amount of income that will be foregone by authorities as a result of the policy that we have set out. It is a fact that around £425 million of community charge was not collected in the four years that the charge operated in Scotland. Almost all of that £425 million can no longer be collected. Over 20 years has passed since the community charge was abolished and replaced with the council tax. Many people have moved home in that time, moved away from Scotland, become married, changed their name or, in certain circumstances, have sadly deceased. They could not now be traced and linked to a debt. Even if a person could be traced, if no attempt had been made to recover outstanding arrears from a debtor within the last 20 years, then the local authority cannot pursue the debt any further. In the last financial year 2013-14, those authorities still collecting community charge debts collected a total of £327,000. Projecting the declining rate of collection forward, we can easily see a point at which the costs of collecting are greater than the sums collected. Local authorities tell us that the total that they can recover under existing recovery arrangements is £869,000. For years after the abolition of the community charge, collection rates for the community charge and for the council tax that replaced it were lower than for the domestic rates that the community charge replaced. I can understand that there may be a concern that the legislation will have a similar effect. However, people objected to community charge because it was a tax that bore no relation to what people could afford to pay. Council tax liability is linked to ability to pay through the council tax reduction scheme, which supports those on low incomes in meeting their council tax liability. Those still paying off community charge debt include some of the poorest and most vulnerable in our community who were unable to pay at the time and are now paying very small sums towards their years every week or even having them deducted from social security benefits. In some cases, those benefits may be their only source of income. Over 20 years after the community charge was abolished, it could still be many years yet before some debts are cleared. Furthermore, the referendum on independence inspired record numbers of people to register to vote. Many of them had not voted for decades, some never before. We do not want people to fear being on the electoral registers because of decades-old debts on discredited legislation that cannot, in all practicality, be collected. The bill will help to avoid that and ensure that everyone's voice continues to be heard. Each local authority still collecting community charge debt will receive as part of their settlement what they would have collected if their outstanding recovery arrangements had continued. They will not be compensated for £425 million, which is now uncollectible. The bill is one step, which the Scottish Government is taking to make local taxation fairer. The independent commission that we will establish to examine fairer alternatives to the current system of countertax is another. Meanwhile, we should consign the poll tax to history and extinguish any remaining liability for a disgraced and defunct tax. Thank you very much for that opening statement. As you have been to the Finance Committee, there are countless occasions. I will ask the opening questions and then move around the table. Let's start at the beginning with the policy objectives to the bill, which she touched on in your statement. It says here, following recent high levels of democratic engagement in Scotland, the electoral registers are not used to pursue historic areas of community charge as well as any on-going repayment arrangements that are already in place. The local authority representatives who were here before, including the representatives of COSLA at Glasgow and D, said that they did not use those systems to collect the tax. Is your view that it is a perception by people rather than a reality that it is used to collect the ancient tax? Shortly after the independence referendum, comments were made by local authority leaders to the effect that they intended to now use the higher level of registration that was part of the product and process of the referendum to try to collect further historic poll tax arrears. That was an indication of the intentions of certain local authority leaders. Ten local authorities have already stopped paying this, and the COSLA view is that legislation is not necessary. Is any of any information about why those local authorities stopped collecting? Is it because they thought that it was costing more to bring in the tax than the tax was bringing in? What kind of assessment has been made in terms of the cost effectiveness of continued collection? If we look at some of the sums of money that remain to be collected at individual local authority levels—for example, Argyll and Bute Council—there are 63 pounds to be collected. We can all, with an application of common sense, realise that the pursuit of 63 pounds in one particular historic poll tax arrear is going to incur recurring costs to ensure that that is in fact collected. The other authorities who are not collecting have obviously come to the conclusion that there is no worthwhile or legitimate area of activity that can be pursued to take that forward. Do you know that Dundee seems to collect about a fifth of all the poll tax arrears that exist out there? Does it seem to be able to collect that money? Is there any reason why it is different from other local authorities? Do you think that? The same from the city of Dundee Council is that, essentially, when they are collecting arrears from individuals, they allocate those against more recent council tax debt. Essentially, they are making good council tax payments with some of the arrears that have been collected rather than allocating them against the historic poll tax arrears for which they still have a connection and an ability to collect. It is a different focus in the city of Dundee Council's approach, compared with those of other authorities. Thank you. Do you get any figures at all on the cost of bringing in the £327,000 that was brought up by the still collecting local authorities? Do you have any idea about that? You mentioned your opening statement about consultation. North Lanarkshire Council said in my quote that it was in Congress that a bill is considered necessary as up the high levels of democratic engagement, but the bill itself will not be subject to a formal public consultation. How do you explain that in a way? How are the views of the public, the majority of whom have made payment of their community child's liability, to be understood? I accept that those are not the habitual arrangements that we have towards consultation. The Government decided to act because we were concerned that, going back to the comment that I made earlier on—in one of your responses to your earlier questions, convener—there was an expressed appetite among certain local authority leaders to use the information that had been gathered by registration during the independence referendum to essentially reactivate the pursuit of many of those outstanding arrears. We felt that that sat very uncomfortably with what I thought was a general view across the country of wide appreciation of the upsurge in democratic participation that we saw, which was supported and complemented right across the political spectrum in the independence referendum. It would be a rather strange conclusion that we felt to that democratic process to then use the information that has been gathered to pursue historic debts from a tax that is discredited and that has not been operational for over 20 years in Scotland. We wanted, therefore, to do two things. We wanted to act expeditiously to address that point, which is why we have pursued a shorter consultation process and, of course, organisations that would potentially suffer any financial impact as a consequence—a negative financial impact—have been consulted with as a consequence of that process. However, we also wanted to make sure that we made it absolutely crystal clear from a local authority perspective that local authorities were absolved of any statutory obligation to collect poll tax debt, which up until the passage of the legislation will remain the case. Of course, all MSPs, if not all, have received a number of communications from constituents who have said, and I quote, what about those who paid at the time. East Ayrshire Council has said that, if the Scottish Government is determined to rate off the debt, will they then reimburse the millions of law-abiding people who have for many years paid their community charge, even though they did not agree with it in principle? That is a very frequent one. That was from an individual called John Nellis, I should have said, but East Ayrshire Council has raised similar concerns. I wonder if you can comment on that, because that is something that we are all getting correspondence about, I would suggest. Certainly, I have not had anyone incidentally tell me what a great idea the bill is, but I have plenty of writing to me on those kinds of terms. I acknowledge the point that you make, convener, and I have had letters from my constituents of expressing exactly the same point. We are dealing here with a situation in which a tax that was the subject of significant public disquiet at the time of its implementation was a very short-lived tax that only functioned for four years, demonstrating its unsustainability as a particular local tax. That action was taken over 20 years ago to address the inadequacies of the poll tax and to abolish it. We have given a reasonable length of time and opportunity for historic debts to be collected. We are now reaching the point where, in certain parts of the country, voluntarily, 10 local authorities have decided not to collect any more, so they have essentially taken the decision that the Government is now proposing to legislate for. We have reached a very pragmatic point where we all have to recognise that the tax has entirely run its course, and the collection of the remaining and outstanding elements of the tax that can be collected is now a much more—it involves all the practical issues that you have raised, convener, and your own questions about the additional costs of collection and the disproportionate costs of collection for the sums that are actually collected. None of that, of course, takes away from the very clear view that I have, which the Government has and which is implicit in all the legislation that we take forward, is that people should properly pay the taxes for which they are liable. That is the message that we take in relation to the council tax. It is what we take in relation to the taxes for which we will soon be responsible in relation to land and buildings transaction tax and also landfill tax. I understand your point of view. The issue that I should have used was that it is a difficult argument to have with an individual who feels aggrieved that they have paid and in some cases placed themselves in considerable financial hardship to do so. One of them is that others are now being excused of their obligations. That is the kind of issue for people sometimes in the local authority front line, but others may explore that further. However, I want to make one final point to give colleagues around the table a chance to make their own. It is just in relation to the comments by the director of finance at Highland Council. He said that he is not supportive of the bill and that local authorities are required by law to take all legal means at a disposal to collect the tax due. The point that he has raised is the issue of unintended consequences. You have touched on the fact that you want others to continue to pay or everyone to continue to pay the council tax, but he has said that the legislation may leave the impression that, if you avoid paying debt long enough, it will eventually be written off despite what the Government is saying at the moment. At the same time, he talks about how the timing of the council tax commission is very worrying about the possible negative impacts on future council tax collection levels, and that the bill brings an avoidable risk. The fundamental difference between what we are discussing today and the council tax is that the council tax is a live tax and the poor tax is a dead tax. That is the fundamental difference. That is why I think that there is no similarity in the point that the director of finance of Highland Council, the poor tax, is a dead tax. We are essentially pursuing historic liabilities that we can see from the data that are petering out year by year in terms of the ability to collect. If I look at the data, if I go back 10 years, convener, £3,916,000 has been collected in poor tax rears in 2004-05. In the last financial year, it was £327,000, so it is quite clear that it is petering out. Disproportionate resources have been used in collection, and, crucially, it is a dead tax. It is no longer in place. The council tax is a live tax, and people have obligations to pay it, and I unreservedly support the necessity of individuals to pay their council tax. In terms of collection rates, the collection rate for the poll tax was approximately 88.4 per cent. The in-year collection of the council tax is 95.2 per cent, which is the immediate year for which liability arises. The expectation is that, in excess of 97 per cent of council tax, it is collected once follow-up mechanisms are taken within short order to ensure its collection. The pattern of collection capability between the council tax and the dead poll tax is the strongest reassurance that can be offered to the director of finance of Highland Council. Is there not an issue of public perception, though? That is the issue that she has raised, which is that people may feel, regardless of the political views that you have expressed in terms of one tax and another, that people might feel, well, hold on a second, that was written out, if I hang on long enough. There may still be pursued just as actively for the council tax, but there may be more resistance to paying it, which will impact on the council tax collection figures. That is the point that a number of local authorities have been trying to make to us. The difference is easily expressed and made clear as the difference between being a dead tax and a live tax. That is the point. We are not dealing with arrears that were crystallised in the last month or the last 12 months even. We are dealing with arrears that were crystallised 20 years ago, and we are dealing with the very end of the line of the particular tax. On the council tax, an individual who is not paying their council tax is certainly my experience in the locality that I represent pursued assiduously. A number of levels want to make sure that any financial advice that is available to an individual should be available to an individual in financial hardship is made available to them so that if there is a payment problem that the individual has with the council tax, the local authority will be intent on finding out if they are entitled to a council tax reduction or some other form of support. Then, if not, the pursuit for collection and those collection rates that I have just talked about give us confidence that those mechanisms are in place within local authorities. I did not want to stop at this point, but you have prompted another question and I will let colleagues in. You talked about a live and a dead tax, but if the Scottish Government were to replace the council tax with a local income tax, the council tax might be classed by some people as a dead tax. How would that argument that you have made hold water if we were to move to another taxation system after, for example, the Scottish elections if the SNP Government was re-elected? The council tax is currently a live tax being paid. Today, a demand was last issued over 20 years ago to anybody in Scotland. Those are not comparable. They are completely different concepts. As I have also said in relation to the point about if there was to be a replacement to the council tax, the council tax collection rates are upward of 97 per cent. The performance of local authorities in collecting the tax is very high and very strong, significantly stronger than at any stage under the community charge. As I have said, the community charge is over 20 years old dead. The point that you have made was that one of the arguments for the bill is that we do not want councils wasting money on spending and collecting very little money. Is there evidence that councils are spending a lot of money? We got the impression from Glasgow and D that their collection costs are quite minimal. Some councils are not spending any money at all because they have stopped collecting it, so that is just the end of the story for 10 local authorities. There will obviously be costs of collection involved in the remaining outstanding arrears, but some of those costs will have been acquired over time and put in place payment arrangements that will now be running their course. We did not do anything. Do you think that 10 would just drift upwards until it eventually got to 32? Do you know—I asked the councils, but they did not really know—sorry, yes? We also add on to that. However, there would still be a statutory obligation on local authorities to collect, so the point of the legislation is to absolve local authorities of that statutory obligation, which I would have thought, and which is the point that I have made to COSLA, would be something that would be welcomed by local government. My guess is—I do not know if you could answer that, but the people who are now paying a pound a week or something are perhaps people in quite a lot of poverty and are actually honest and are trying to pay the pound a week compared to the vast majority, which is just not being paid at all, but I suppose that is. However, they will be in small sums of money that are being paid. If you look at 2013-14, Aberdeenshire Council raised £1,000, likewise in Murray and Inverclyde, so those are going to be made up by very small sums of money that have been paid by individuals. I was asking the councils if they knew how long other organisations pursue debt, and they did not really know. I do not know if you can give us any idea of that, just so that we get a comparison with the idea of 20 years. Do we know how long the utility companies say would pursue debt, or do we know how long a shop would pursue a debt? The length of time that varies in different circumstances, there will be examples. In the prescription and limitation Scotland in 1973, some debts and obligations prescribed after five years. I am sure that I do not have that in front of me, but there will be variations in the degree to which obligations exist for. By implication, some debts get written off much quicker, and 20 years is not particularly short. It is quite a long period of time. The final thing that I wanted to touch on was the £869,000 and how it is being split up. Presumably, you had various options. One would have been to take the total debt and say 0.02 per cent or something that we are actually paying out and just give it in proportion to the debt. The councils basically told us that their net value of the debt in their accounts is nill because they have fully provided for it. Presumably, there was an argument that the councils did not need any money and the £869,000 is a bonus. However, you have chosen the third option based on what they are collecting. Could you explain to us why you chose that option? That struck me as the fair option. If local authorities were still endeavouring to collect the elements of the poll tax and they had and were able to provide for us, which they have done through COSLA, the sums of money authority by authority that are still essentially in play to be collected, I thought that it was a reasonable point of agreement to accept that the Government should compensate local authorities for those sums of money. I should point out, cabinet secretary, that a lot of Highland Council have said that local authorities are required to take all legal means that are supposed to collect due tax and that they are not support of the bill. They have, in fact, ceased collection. That is absolutely correct. Thank you very much, convener. The evidence that was given to us earlier from the local authorities, the answer was given to Jeane Irker at the time that the debts are not currently held on the books by the councils. The sums that we are speaking about here do not show up on the councils annual return of accounts, for example. Do you feel that the £425 million figure that is bandied around is an unhelpful one in the sense that A, the debts are not currently held against the accounts of the council but also the point that you have raised about the likelihood of recovery of the vast bulk of that debt? I think that the £425 million figure is, whereas I said in my opening statement that it is a fact, that that is the amount that is currently uncollected of poll tax debt, but it is a meaningless figure because it is never going to be collected. Certain authorities or 10 authorities have decided that their share of that £425 million is just not going to be collected, and some of them have not been collecting it for some considerable time, so it is just completely meaningless as a relevant figure. I wonder if you would agree with me that where those authorities and those 10 authorities who have taken the local decision to cease collection, the issues that are being raised that the legislation could give rise to individual behaviours around council tax debts, council tax rears, we would have perhaps seen evidence of that manifesting itself in those local authorities that had taken that local decision, but given the collection figures that you have pointed out, that does not appear to have been the case. Therefore, would you suggest that the experience in those local authority areas would suggest that those fears may perhaps be unfounded? I think that we are talking about two completely different things here. I think that local authorities deploy very good practice in relation to council tax collection. The rates of council tax collection have improved significantly over the past nearly 20 years, and they have become much stronger. I think that authorities pursue that approach in an effective way. As a consequence of that, I think that what we are essentially doing here is tidying up a long-standing issue and doing it in a way that is fair to local government. The evidence that we received earlier—Dundee City Council and Glasgow City Council said that they were questioning the rule of prescription, the 20-year limit through which action can be taken. The indication appeared to be that, by renewal of summary warrant, they had essentially got around the 20-year prescription, so the debt, as they saw it, remained in theory recoverable because they were not subject to the 20-year limit. The two questions that I have off the back of that are, do you think that local authorities should be taking that view in terms of the whole debt sum given what we know about recoverability anyway, but also does the Scottish Government take a view around the 20-year prescription period? I know that it is separate perhaps from the legislation, but it has given rise to the disparity that exists between the situation south of the border, where I think that it is a six-year period that the debt was pursuable compared to a 20-year period in Scotland. Obviously, that has been thrown into contrast as a result of this move. Has the Scottish Government taken any view on that beyond this legislation as something that it might examine? As a point in principle, no, we have not. The conclusion that we have come to has been prompted by the set of circumstances that I raised with the convener at the outset, whereby the suggestion that the upsurge in democratic participation in the referendum and participation in the electoral process should somehow be used as a route to reactivating the pursuit of historic debt, which, as Mr MacDonald has said, would become proscribed in circumstances in which the debt had not been pursued in any way over a 20-year period. That is what has prompted our action on this particular piece of legislation. As to the general principle and what underpins the terms of the prescription and limitations Scotland in 1973, the Government has not given consideration to that point. Just one final question, convener. A number of witnesses and submissions to the committee have spoken about sporadic and informal payments, i.e., the Scottish Government has received the sums that were likely to come in from those payment plans or recovery plans that were in place. Some local authorities have spoken about the existence of sporadic and informal payments. Presumably, the Scottish Government did not factor those into the calculation, because there is no way to come to any kind of accurate figure about the potential of somebody turning up at the doorstep of a council and saying that they wish to make good their debt without there already being a recovery plan in place? There is no reliable means of estimating that. I think that one of the things that we can look to is the pattern of payment under the poll tax arrears. As I indicated earlier on, that is a steadily declining year by year to the point where in the last financial year for which data is available, it totaled £327,000, so we are seeing that peatering out quite significantly. If an individual is troubled by all of this, there is nothing to stop them paying off their arrears now, if they really want to. There is nothing to stop that. There is nothing to stop them after the bill has been enacted making a donation to a local authority to assist with its work. There is nothing to stop them doing that, if they are particularly troubled by that. In terms of the orderly disposal of liabilities to local authorities, this is the right move for the Government to take. You make quite a big distinction on several occasions between what you describe as a live tax and a dead tax. For how much longer will the council tax be a live tax? It is a live tax today and it will be a live tax for as long as Parliament wishes it to be a live tax. Is it correct to say that the Government is setting up a commission, which meets, I think, tomorrow, with the objective of replacing the council tax? The Government is setting up a commission, as we said in the programme for government, to try to work with other political parties. The invitation has been extended to all political parties to participate in this. I hope that all political parties decide to participate in this, given the fact that the Local Government and Regeneration Committee suggested that the Government should work to create agreement among all political parties on this question, and to work in partnership with our local authority colleagues on arriving at an approach to local taxation that was broadly supported. That is the objective of the commission that the Government is setting up. I look forward to all political parties participating in that process. In terms of the wording that the Government has said and the letter sent to political parties, did it say an approach to local taxation or does it say replace the council tax? I do not have the letter in front of me, convener, so I am happy to provide that letter. I am happy to provide the letter to the committee. I do not have it in front of me to set that out. I am just trying to establish that the Government's intention, as far as I am going to side, is to replace the council tax and turn that into to use the Cabinet Secretary's word, a dead tax. That was the purpose of the question. I have not come equipped, convener, with the wording from the Government's manifesto, but please do not have this quoted back to me what I am about to say. However, I think that the Government's manifesto said something like, consult with others to design a system of local taxation that had a better relationship to the ability to pay, something like that. I do not think that that was the exact wording, but it was of that character. We are just inviting other political parties to be involved in that conversation. I will leave that at you. Use the word consult their Cabinet Secretary, which leads on nicely to the idea of a consultation. The convener put the question to you, others have raised it. In the absence of a consultation, how are the views of the public being taken into account in the formulation of the bill? Clearly, we hear representations from members of the public, we hear representations from members of Parliament on behalf of their constituents. I have certainly replied to a number of members of Parliament who have raised issues with me about the proposals in the bill. Do you not think that the public should have a say prior to stage 1 in that there should be a formal consultation on the issue? We have sought agreement of Parliament to undertake an expedited bill process to enable us to make the bill effective from 1 February 2015 to ensure that there is clarity before the start of the next financial year. Do you not think that there should have been even an expedited public consultation? I do not feel as if I am being insulated from public opinion on the issue, because as the convener has said, a number of members of the public have raised the issue. As I have indicated already to Mr Brown, I have replied to a number of members of Parliament who have raised the very issue that Mr Brown has raised with me, so the Government is conscious of that issue. I understand the concerns that are expressed by members of the public who have paid their community charge. As I have done, I should make that clear, since I am old enough to have been liable for the community charge. I understand the concerns that those members of the public are raising. In terms of what did happen, I look at your policy memorandum under the heading consultation. Officials have consulted COSLA and local authority practitioners on the development of provisions in the bill, which have operational implications for local authorities to ensure that those provisions are informed by how community charge debt collection operates in practice. I was reading a paragraph 14, page 3 of the policy memorandum. When I asked COSLA today and the two local authorities who were giving evidence, it was only two local authorities about the consultation process with them. You can check the record in the official report, but the suggestion was made that there was a meeting to discuss quantum, which lasted longer and shorter than that meeting had taken place at that time, which was about 40 minutes on the clock at that stage. However, their understanding—and certainly the witnesses who spoke to us—was that there had not been any consultation on the terms of the bill, the political objectives of the bill and, indeed, some of the unintended consequences. That is what those witnesses said. Are you saying to me that there were other consultations with calls that those witnesses were not aware of? If so, what was in nature? I do not know what instances or examples of consultation were being mentioned by the local authorities that were here. I am certainly very happy to provide the committee with an explanation of the consultation steps that were taken by ministers and officials with local government. I can confirm one bit of it for the sake of the record. Mr Brown asked me about consultation about the policy intent and the principle of it. There was no consultation with local government about that point. I telephoned the president of COSLA about 15 or 20 minutes before I knew that the statement was going to be made in Parliament to give him advance warning, so that is what consultation there was. We did not ask COSLA if they agreed with us about this. I phoned the president of COSLA to advise him in advance that this announcement would be made. You are going to furnish with the record, but I only say that because the policy memorandum says that there was consultation on the development of the provisions in the bill. That just seemed different to what I heard today, but of course they may not have had the complete picture. They may not have, but I will furnish the committee with the detail that supports paragraph 14. I am grateful for that. What is the Government saying to two individuals, one individual who both disagreed with the community charge and one of whom ended up paying it, perhaps making sacrifices to do so, and another who simply did not and is now being absolved of it? How does the Government explain that to those two individuals in terms of fairness in the way that the Government ought to operate? What I would say is that I start from the principle that people should pay their taxes. That is my basic principle in all this. I do not support the fact that people do not pay the taxes for which they are liable. That is the first thing I would say. The second thing is that I think we are dealing with quite exceptional circumstances here. We are dealing with a tax that lasted four years that was the subject of massive political controversy of enormous political disruption, a very significant political disruption to one individual that I can remember, who lost office on the back of the potachs, the late Prime Minister, Mrs Thatcher. This was an issue of enormous political conflict and dispute. It was concluded 20 years ago. The best efforts of local government have been deployed over 20 years to try to collect this tax. As we see from the data that we have in front of us, various authorities over the years have worked away at trying to collect these arrears. In certain circumstances, for example, in Falkirk, nothing has been collected of this tax since, well, I have got the data back to 2003-04, and nothing has been collected in Falkirk since then. There have been efforts around the country to try to collect the tax. We have reached a point where there has been a particular intervention that has prompted the Government to say, let's just draw a line on this. Ten local authorities have decided not to collect any tax and aren't doing so, and we are simply regularising that across the country. I appreciate and value the fact that those individuals have fulfilled their obligations to the public purse. I acknowledge that what the Government is proposing is perhaps not something that it supports, but it is something that we believe is important to bring to a close what is a pretty unsatisfactory and unsavory part of our political and taxation history. Another issue that has been raised briefly, but there is a concern among the councils that have submitted evidence to us that it could impact on their council tax collection. You have obviously referred to the current collection rates. If, though, their fears turn out to be true, and it does impact on council tax collection, particularly historic council tax collection, they can demonstrate that it has hardened attitudes, if you like, or just made it more difficult to collect the money, is the Government agreeable to underwrite those sums that they feel they've lost out on, or is the Government hoping that it doesn't turn out to be the case? If it does turn out to be the case, is the Government going to back local government and underwrite those sums? I think that the distinction that I would make is the one that I made to the convener, and that's the difference between a dead tax and a live tax. There's a live tax for the council tax, so I would encourage local authorities to pursue council tax collection as efficiently as they currently do so. I see nothing that is a read across from the abolition of historic poll tax debt, which is now clearly uncollectible in the country and has been for some considerable time. I see no connection between that and the collection of the current council tax. You don't see the connection, but if the council's fears, as expressed to us, turn out to be correct and they can demonstrate to some degree that that has been the case, as a matter of principle, is the Government effectively putting its money where its mouth is and underwriting? No, because the collection of council tax is the responsibility of local government and it's an on-going responsibility of local government and local authorities to do that. I don't mean the collection of current, but if it turns out that there are historic rates of council tax debts from years gone by, if there's a dramatic slowdown in the collection rate of that and it can be attributed to this policy, then is the Government not willing to move to help councils there? No, because that's the responsibility of local authorities to undertake that collection activity. For example, Mr Brown said that if it could be demonstrated that that slowdown was attributed to the passage of its legislation, that would be a really interesting point to prove and demonstrate how that had any substance about it. If that was used, for example, as an excuse by somebody to resist due process in pursuing, in the collection of a council tax liability, there would be no substance of standing to that whatsoever in due process. Last question, then. In terms of the, you said that local authority leaders were saying publicly or privately, I don't know if you said it, they were saying it publicly or privately, they intended to use the expanded electoral role to collect backdated community charge debts. They may well use it to collect backdated or historic council tax debts too. Is the Government comfortable with that? The individuals have got liabilities for the council tax, which I think individuals should fulfil and local authorities are entitled to use the publicly available information at their disposal to collect arrears of council tax. Jeane Tymfawld, Richard Mountain. A point of clarification from me, I think, Cabinet Secretary, is that we talk about needing, we need to have this legislation in order to absolve the councils from pursuing taxes, perhaps from people who have since deceased or emigrated or whatever, and yet there are 10 local authorities who have stopped doing that without legislation. I just wonder what the, on one hand, we seem to be saying that the councils are legally obliged to pursue tax. What difference then for the 10 local authorities who appear not to need the legislation to do what you think they should be doing? The 10 local authorities who are not collecting any are essentially voluntarily turning a blind eye to the collection, or maybe it's impractical for them to collect any. Maybe they just have absolutely reached the end of the road, but there will still be obligations there in law, and that's the purpose of the legislation, is to remove that obligation in law. Right. Do you think that there might have been a way forward in other local authorities doing it on a voluntary basis in the same way, rather than managing legislation? I think that the legislation removing this particular obligation and duty on local authorities just clears up the law, and where we have the opportunity to do that, we should take that to make it absolutely crystal clear where the law stands on these matters. Finally, do we have any idea how many people are? I mean, I'm assuming that a local authority would not be after 20 years pursuing somebody who was dead or had emigrated 15 years ago, I mean, do we know for sure that the amount of money that we're talking about is actually including money's 20 years' worth of poll tax that's somebody who's deceased or has emigrated or moved to another part of the UK? I don't have particular, obviously we're dealing with a range of individuals here, I don't have any particular colour on the nature of who is being pursued, who's got particular payment arrangements in place, I can't furnish the committee with that, but what there is is a variety of different levels of collectivity around the country in different authorities, and it is clear from my reading of the data, or the conclusion that I arrive at having looked at the data, is that essentially there have been a number of payment arrangements in place with a reasonably large number of individuals over probably a 15 to 20-year period since the abolition of the poll tax, and that those existing arrangements have been sterilely petering out, and what you've not seen is an upsurge in arrangements, let's say, five years ago, to get new people to accept their obligations and to pay those up. I think that the data, the conclusion I arrive at from the data, is that payment arrangements were put in place in 1992, 93, 94, 95, 96, and then there's just generally petered out. Right. I think some of that information will be quite important in terms of perhaps convincing some of the people who are writing to me as they are to you and everybody, and all other MSPs who see this as unfair. I personally don't agree with their view, but I think it will be important that there is some presentation of some of these facts that make it much more real, and I think back up the legislation rather than that it's going to be quite easy to have to deliver that information to people who feel that it's unfair. I think we have to accept that in some of the consultation papers that we've had back from local authorities, there is a, and I think something that we've talked about before in terms of tax collection, a confidence that's required that actually people confidently pay tax that people don't like being in debt, and I think both of those are key in many ways to this legislation. That's in a sense my conclusion that I've had looking at the issues around about council tax collection, that the council tax collection rates are really very strong and they've got much stronger in recent years, so I think there is that evidence that people are actively paying their obligations towards local authorities to support the public services that are available in our localities, so I think that that point is very strongly and clearly evidenced by the experience of council tax collection. Thank you. The logic of your argument about why you wanted to move quickly with this policy, but this morning you've basically said that there was no consultation at all with local authorities about the intent to bring forward this legislation. Surely this policy could have been introduced quickly, expeditiously, but also including time to have that dialogue properly with local authorities over this intent to bring this forward. How does that approach sit with the Scottish Government's relationship to local authorities and respect for the importance of their duties, their responsibilities and their views? I think we, as a minister who's been immersed in our dialogue and discusses with local Governments since 2007, there is frankly a barload of evidence of the Government's good practice in communication and dialogue with local government about the formulation of shared priorities and about the development of the wider policy agenda, which I see as a partnership between the Scottish Government and local government. Do you think that this meets the standard of good practice? I don't think that this is a particularly typical example of how what the point I was making is that we've got ample evidence of the way in which the Government properly, fully, openly, exhaustively consults with local Government about many questions. I would freely acknowledge that that is not the norm. I accept that. We acted because we didn't like the way in which post referendum, the upsurge in democratic participation, was being suggested as being a means of collecting historic poll tax barriers by certain local authority leaders, and we wanted to act swiftly to nip it in the bud. We could have had an extensive consultation, but that wouldn't have swiftly nipped it in the bud. I appreciate your point of view on that, but Jeane Irkett raised again the important question of to what extent legislation is necessary. That was raised by COSLA as well. If you had had that consultation beforehand, that whole area of thought could have been explored more considerably. To what extent did you consider alternative routes legislation to achieve the policy objective before bringing this bill forward? The President of COSLA has made the point to me in correspondence as to whether or not legislation was required. The response that I have provided to Councillor Anil has been to say that we wanted to legislate to remove any possible doubt about the solution to those issues. We wanted to make it absolute crystal-clear in law. Having come to an agreement with local government about the Government meeting the cost of the outstanding collectible poll tax debts that could be identified by local authorities, we wanted to draw this matter to a conclusion with a clarity that would enable local authorities to be absolved of any obligation to collect any further arrears. I would have thought that legal clarity would be something that would be welcomed by local government. In his questions to your Government, Brown raised the issue of using electoral roll generally to recover debts to councils. You said that you thought that that was appropriate for council tax debt, but did you explore at all the possibility instead of approaching a policy whereby it was made clear to local authorities by guidance or whatever necessary mechanism? In fact, electoral registrations should not be used for those purposes. In fact, councils should not be using that information when it comes to pursuing debts owed to them because does not the issue apply to council tax as it does in fact to apply it in terms of this tax? That should not really be a factor when encouraging people to vote or take part in the democratic process. There are a number of factors that are wrapped up in that particular question. The simplest way to address this point is to look at what is the core substance of the issue at stake here. Is it desirable for people to become involved in the democratic process in 2014 and find that the first thing that happens to them as a consequence of that is that they are pursued for historic poll tax arrears that have been dead for 20 years? Is that the first thing that we should make as a connection? I fundamentally disapprove of that. I think that that is the only thing to do, which is why we are legislating for what we are legislating now. It is a wider question about the utilisation of the electoral rule. I have concerns about the way in which the electoral rule can be available to a whole variety of different organisations to pursue individuals, not necessarily for debt but for other purposes. I get representations quite frequently from constituents who feel actively pursued by external organisations, which are clearly using the electoral rule. We have to look at some of those questions, which are issues that the Government has raised with the UK Government in this respect. Fundamentally, the way to address the issue is to provide absolute legal clarity for local authorities that the debts arising from the poll tax have been extinguished. Is that the issue that we are addressing here? Are you comfortable with councils using information to chase up council tax debt? They are entitled to do so. Finally, convener, will the issue of debt recovery be part of the discussions that we had at the commission that you have established to discuss the future of local taxation? In respect of what? Just this general issue. Obviously, some local authorities, including Highland Council, raised the issue of their concerns of a precedent set by the legislation. Do you think that that general approach in terms of maximising income to councils is an appropriate way to chase up debts to councils to be part of those discussions? Does that should be a separate issue? I think that it should be a separate issue. I would like to thank the cabinet secretary for his evidence. I am just wondering if there is any further points that you want to make, cabinet secretary. I am happy to wind up this session. I would like to call a two-minute recess to allow a changeover of officials. Our next item of business is to take evidence from the cabinet secretary on the landfill tax, prescribed landfill site activities, order 2014. The cabinet secretary is joined for the item by David Caruchy, Neil Ferguson and John St. Clair of the Scottish Government. I invite the cabinet secretary to make an opening statement explaining the instrument and I would also like to remind him not to move the motion at this point. Section 6 of the landfill tax Scotland Acts 2014 provides a power to prescribe certain landfill site activities. If a prescribed landfill site activity is carried out at a landfill site, the activity is treated as a disposal of waste to landfill at that site. The list of prescribed activities in regulation 3 of this order relates to temporary engineering activities on a landfill site. The background to this order has its origin in case law concerning the UK tax in the case brought by waste resources group against HMRC in 2008. The English Court of Appeal ruled in favour of the waste resources group. It concluded that engineering activities on a landfill site were classed as non-waste disposals to land and as such those activities fell outside the UK tax. In response to the rule in the following year, the UK Government brought forward the landfill tax prescribed landfill site activities order 2009 to bring temporary engineering works into the scope of the tax. It is the Scottish Government's view that all waste material deposited at a landfill tax should be subject to Scottish landfill tax, unless, of course, there is a specific exemption. It is deposited in a non-disposal area or is used in the final restoration of the site. Building on the experience of HMRC in that case, this order brings material from temporary engineering works on a landfill site into the scope of the tax. Activities relating to the permanent restoration of a landfill site are not, however, within the scope of the Scottish landfill tax, as we would not want to create any barriers to the full and final remediation of a landfill site. A draft order was included in the public consultation paper Scottish landfill tax, a consultation on subordinate legislation published in June of last year. 85 per cent of respondents agreed with the proposed orders. Ernst and Young, LLP and CETA UK Ltd, for example, suggested that mirroring the UK list of prescribed activities would alleviate concerns about the possibility of waste tourism. Thank you very much for that, cabinet secretary. I have no questions myself. I just want to ask members of the committee if they have any questions. John Mason. The argument has been put that, if somebody builds a road somewhere else, especially if they would be using recycled material, there would not be any tax on that, so it seems to some people that it is logical that there should be a tax on a road that was built within a landfill site. Can you explain why that would not be the case? The rationale for that is to ensure that the activity that gives rise to waste has to essentially reach a landfill destination is properly taxed in that process and in all circumstances. The fact that there is activity that is happening within a landfill site does not absolve it of that necessity to be captured by the consistency of the tax. Is it not the case that the same materials used outside the site to improve access and transportation would not attract the taxes? Is that not the case? Is that not the point that is being made by some of the people who are concerned about it? The Chartered Institute of Taxation says that it is difficult to see why building a road inside a landfill site should be considered as a disposal of waste when the same activity done outside the site would not be. That is what is associated with the concern. I think that we have to look at where the waste is clearly being generated within that site and has to be disposed of. That is the point that we have to focus on. The point that Mr Chisholm is making about a development outside a landfill site is that that will be sourced from materials, which will come from a variety of different sources for which whatever tax has got to be charged has been charged. The distinction that I am making here is that where a road construction is undertaken within a landfill site, the purpose of doing that should have given rise to landfill tax if the material had been removed from that site and gone to a landfill site. Establishing that point is that if there is waste, there has to be a charge on that waste, even though it may be used within a landfill site. Is that the simplest I could try to express it? I shall reflect on your response. That is the most generous response. No further questions. We now move to the debate on the motion. I invite the cabinet secretary formally to move motion S4M1207. I now put the question on the motion. The question is that motion S4M1207 be agreed to, are we all agreed? We are all agreed. The committee will now publish a short report to Parliament setting out our decision on the order. On the next item of business, we have to take evidence from the cabinet secretary on three items of subordinate legislation in relation to the land and buildings transaction tax. I would like to invite the cabinet secretary to make an opening statement. I will take each of the three land and buildings transaction tax instruments, which are all subject to the negative procedure in turn. First, the prescribed proportions order sets out prescribed proportions for two reliefs from LBTT, multiple dwellings relief and acquisition relief. To encourage investment in the private rented sector, schedule 5 to the LBTT act provides tax relief for land transactions evolving a purchase of multiple dwellings. Relief is provided based on the calculation of the average price of each dwelling being acquired applying residential rates of tax to each dwelling rather than charging the higher rates of tax on the full purchase price of the multiple dwellings. Paragraph 12 of schedule 5 allows Scottish ministers to prescribe a minimum proportion of LBTT, which must be paid so that the amount of relief is effectively capped. This instrument sets the minimum proportion of LBTT that must be paid where the relief applies. The consultation paper is moving forward with land and buildings transaction tax, a consultation on proposed subordinate legislation, published in May 2014, proposes setting a minimum prescribed proportion of 40 per cent of the LBTT that would be payable in the absence of multiple dwellings relief. 11 respondents opposed the proposal on the basis that it would result in a higher tax liability than under stamp duty land tax. Taking the views of those who responded to the consultation into account, I have concluded that an appropriate prescribed proportion for multiple dwellings relief should be 25 per cent. The logic behind this is that under the slab tax structure for SDOT, which applied at the time, where the average price per dwelling being acquired fell in the nil rate band, a tax floor was charged at 1 per cent of the whole average purchase price of the dwellings. If the chargeable consideration for the whole transaction exceeded £1 million, as it often would, though not on all cases, in the absence of a relief, tax would have been charged at a rate of 4 per cent. As 1 per cent as a proportion of 4 per cent is equal to 25 per cent, then 25 per cent is, in my view, a comparable prescribed proportion for the relief under LBTT. Part 3 of schedule 11 to the LBTT Act provides for acquisition relief, where a land transaction is entered into by a company for the purpose of or in connection with the transfer of an undertaking or part of an undertaking of another company. The instrument prescribes the proportion of LBTT that must be paid where the transaction qualifies for acquisition relief. 11 respondents to the consultation paper addressed this question, with views divided on the proposed rate of 15 per cent for the prescribed proportion of acquisition relief from LBTT. Under the slab tax structure for SDOT, tax was charged using this relief at 0.5 per cent on the chargeable consideration, which, if the chargeable consideration exceeded £1 million, tax would otherwise have been charged at 4 per cent. As 0.5 per cent as a proportion of 4 per cent is equal to 12.5 per cent, then 12.5 per cent is a comparable prescribed proportion for the relief under LBTT. The instrument therefore provides for a prescribed proportion for acquisition relief of 12.5 per cent. I will now turn to the second order, the Qualifying Public or Educational Bodies Scotland amendment order. Paragraph 17 of schedule 2 to the LBTT act sets out what counts as chargeable consideration where a public or educational body enters into a sale and leaseback arrangement with another property, a non-qualifying body. Subparagraph 17.2 sets out which public or educational bodies are qualifying bodies for the purposes of paragraph 17. Subparagraph 2 to C refers to any body listed in schedule 2 to the further and higher education Scotland Act 2005. Subparagraph 3 to C provides a power to varial list of qualifying bodies mentioned in paragraph 2. The post-16 education Scotland Act 2013 removed institutions from schedule 2 of the further and higher education Scotland Act 2005, so that should still have the exemption at schedule 2 paragraph 17 to C applied to them. It is my intention that publicly funded colleges and universities should continue to be in the scope of subparagraph 17.2 of the schedule to the LBTT act. The LBTT qualifying public or educational bodies amendment order therefore amends the list of qualifying bodies in paragraph 17.2 accordingly. This is therefore a purely technical change to reflect the changes to the higher education landscape following the post-16 education Scotland Act 2013. Finally, the definition of charity relevant territories regulations makes use of the power in paragraph 15 3D of schedule 13 to the LBTT act to add to the list of qualifying territories from which a body registered as a charity may originate and be eligible to claim charity's relief, reflecting tax treaties that the UK has with other territories. The LBTT consultation paper published on 1 May 2014 invited views on a draft of the regulations. There was agreement from the 10 respondents to the Scottish Government's proposal that the Republic of Ireland and the Kingdom of Norway should be added to the list of relevant territories for the purposes of charity's relief. One respondent suggested that the principality of Liechtenstein should be added to the list of relevant territories in order to ensure consistency with changes coming into effect for SDLT under the taxes definition of charity relevant territories amendment regulations 2014. To keep Scotland's LBTT legislation in line with UK tax treaties, the LBTT definition of charity relevant territories regulations added the Republic of Ireland, the Kingdom of Norway and the principality of Liechtenstein to the list of relevant territories for the purposes of charity's relief. Just for the avoidance of doubt, convener, I may have inadvertently referred to the Republic of Ireland, but I did mean the Republic of Iceland earlier on. I thought that I would get in there before you, convener. Do you have any questions from members? I have none myself. Cabinet Secretary, in relation to the First Order, SSI 2014-350, the policy note says right at the end impact assessments, government's approach to the prescribed proportions for multiple dwellings relief in that position will be broadly mirrors the current approach for SDLT. Is that referring to the previous approach to SDLT, or has it taken into account the autumn statement? I am just looking to see what the position is. If it is a latter than fine, if it is the former, is there any reworking needed in order to do that? It will apply to both because we are applying a mechanism here. It is not an absolute number but it is a mechanism, so that would deal with all circumstances. Your statement then that it broadly mirrors the current approach to SDLT would stand then? It says that by describing what I am proposing here as a mechanism. Anything else? Malcolm? I am sorry, Jeane, then Malcolm. Just on the same order, I may be wrong about this, but it seems that I remember when we were discussing the changes that we would make within the legislation, cabinet secretary, that this was one area where I am right in saying that it was vulnerable in the legislation that we were changing in terms of tax loopholes and that we were determined to make our legislation as tight as it could. Are you content that we are not making this more vulnerable by changing the legislation in terms of the multiple dwellings? The sentiment that Jeane Irker refers to very much is my sentiment in approaching the legislation. That is evidenced by two things, really, and how we pursued the legislation. One was by the minimisation of reliefs, and there will be fewer reliefs in our legislation than in the current arrangements. Secondly, by the work that we undertook in the Revenue, Scotland and Tax Powers Bill, in relation to the establishment of a very high threshold of intolerance to tax avoidance through the general anti-avoidance show. As I look at the commentary about the general anti-avoidance show, it is now attracting the commentary that I hoped it would attract, which is a pretty high bar and a very intolerant approach that has been taken in Scotland. I am pleased that the tax commentary is now reflecting that intent in our legislation. Although we reduced the number of reliefs, we did not eliminate them altogether, because reliefs have a legitimate part within a tax system. I am confident that the arrangements that I have put in place here are consistent with that approach. You gave a mathematical logical explanation for changing from 40 per cent to 25 per cent, but I wonder whether you thought that it would have any impact on future private housing investment. Is that a relevant factor? Is it significant that there is a change from 40 per cent to 25 per cent in that regard? That concern is interesting that Mr Chisholm highlighted my mathematical logicality on 25 per cent. I do not suppose that I could say that 40 per cent was graced by mathematical logic, so at least we got there in the end. I think that the point that was made by the respondents was that Mr Chisholm makes that 40 per cent might have had an impact on multiple dwellings. I hope that, by the actions that I have taken, I have addressed that issue. It says that it will not be available to private landlords and I quote, who acquire properties in a piecemeal fashion. What does that mean in practice? It essentially means that this is an approach that we are taking on the development of I suppose a project development, if I could describe it in that fashion, which is a cumulative project development in a particular site where there is the opportunity to undertake a particular piece of work that creates a range of properties that would then be available for onward transaction as opposed to a private landlord applying for this type of relief here, there and everywhere, if that makes the distinction. What Mr Swinney has said is absolutely correct. It is where the landlord is acquiring multiple dwellings in one transaction, one go essentially, whereas the piecemeal approach would be to buy them one at a time. This relief would not apply to a landlord buying properties one at a time with a view to building up a portfolio, but where they acquire eight or 10 properties or 50 properties in one go, the relief would apply there. It is to encourage the investment in the private rented sector, as the cabinet secretary said at the outset. That has exhausted the questions from members. I thank the witness today and I have a 30-second break while we allow the cabinet secretary and his colleagues to leave. Our next item of business is to consider the negative instruments on which we have just heard evidence. I would like to invite any comments from members. We have no comment from any members. At the start of the meeting, the committee agreed to take the next item in private. Therefore, I would like to close the public part of the meeting, so I will suspend for 30 seconds to allow the public and official reports to leave.