Holyrood’s Finance and Constitution Committee’s report on the Scottish Government’s draft budget is published today.
The unanimously agreed report warns that Scotland’s budget is now subject to greater volatility and uncertainty.
Bruce Crawford MSP says he is pleased that MSPs were able to find consensus and produce a unanimous report, despite the differences in approach to the Budget taken by the political parties, citing agreement that the new tax and borrowing powers and the Fiscal Framework introduce a ‘significant level of complexity’ to the budget process.
Publication of the report comes ahead of next week’s stage 1 debate on the Budget Bill at Holyrood (Thursday 2 February).
Key amongst the report’s findings are:
- The Committee is very aware that the increased dependence of the budget on relative economic performance combined with the complexity of the Fiscal Framework means that there is now a much greater degree of volatility and uncertainty in the budget process. This uncertainty is exacerbated by the potential impact of Brexit on economic growth and the public finances.
- The Committee emphasises therefore, that it is essential that there is complete transparency in how the Fiscal Framework operates and one of the main purposes of this report is to provide some clarity on this process.
- The Committee recommends that information in relation to the operation of the Fiscal Framework should be provided as soon as it is available in order to provide greater opportunity for parliamentary and wider public scrutiny.
- The Committee also recognises that the operation of the Fiscal Framework is a shared responsibility between the Scottish Government and the UK Government. The Committee is, therefore, disappointed that the Chief Secretary to the Treasury declined to give evidence in relation to the operation of the Fiscal Framework. The Committee believes it is vital that it has the opportunity to hear from an HM Treasury Minister on the operation of the Fiscal Framework as part of the annual budget process. The Committee will continue to pursue this matter with HM Treasury.
Finance and Constitution Committee Convener Bruce Crawford MSP said:
“I am pleased that despite the differences in approach to the Budget taken by the political parties that we were able to find consensus and operate collectively to produce a unanimous report. This is testament to the reasonable and balanced approach taken by all members of the Committee.
“We agreed for instance that the new tax and borrowing powers and the Fiscal Framework introduce a significant level of complexity to the budget process.
“Our Committee, therefore, has a vital role to play in interpreting the complexity of the Fiscal Framework and how this impacts on the budget, and setting out before Parliament all the key fiscal and economic issues.”
“It is clear to us the increased dependence of the budget on relative economic performance, combined with the complexity of the Fiscal Framework, means there is now a much greater degree of volatility and uncertainty in the budget process. This uncertainty is exacerbated by the potential impact of Brexit on economic growth and the public finances.”
“This report is intended to provide clarity and demonstrates the importance of cross-party, parliamentary oversight of both the draft budget and the Fiscal Framework."
The full report is available on the Finance & Constitution Committee’s webpage - http://www.parliament.scot/parliamentarybusiness/CurrentCommittees/103269.aspx
Stage 1 of the Budget Bill is scheduled for Thursday 2 February. Subject to parliamentary approval Stage 2 (Committee consideration) will be scheduled before the February Recess with Stage 3 before the end of February.