03/02/2016

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:00:17. > :00:21.Good afternoon and welcome to Politics Scotland.

:00:22. > :00:26.Coming up on the programme: We'll be bringing you live coverage as MSPs

:00:27. > :00:28.debate the budget, with the opposition challenging

:00:29. > :00:33.And after many months of meetings like this, the Prime Minister

:00:34. > :00:42.Here at Westminster, David Cameron tells the Commons his EU reform

:00:43. > :00:46.proposals are "an important milestone" but there's more work

:00:47. > :00:56.Even so, are we on course for a June referendum?

:00:57. > :00:59.Holyrood is holding a showdown vote on income tax this afternoon

:01:00. > :01:01.as Opposition leaders challenge the Scottish Government to raise

:01:02. > :01:02.extra money to protect public services.

:01:03. > :01:05.Ministers are determined to resist the demands for a tax increase,

:01:06. > :01:07.pledging instead to boost pay, by extending the Living Wage

:01:08. > :01:20.The budget for 2016-17 marks the first time Holyrood ministers

:01:21. > :01:23.have been required to set income tax rates in Scotland.

:01:24. > :01:25.This from our political editor Brian Taylor.

:01:26. > :01:30.Nicola Sturgeon offers social care, visiting a centre in Midlothian that

:01:31. > :01:37.helps adults with learning disabilities. Care workers are paid

:01:38. > :01:41.a Living Wage. The First Minister wants that extended across Scotland

:01:42. > :01:48.and says there are funds for that the budget being today. It she says

:01:49. > :01:51.that Labour's plan to increase income tax. This is a policy that

:01:52. > :01:56.will take money out of the pockets of those we are trying to push up

:01:57. > :02:00.the income scale by boosting the incomes of low paid public sector

:02:01. > :02:06.workers, to claw that back through an increase in the basic rate of

:02:07. > :02:13.income tax is the wrong thing to do. Back to school for Labour's minister

:02:14. > :02:19.in Cowdenbeath. She says all MSPs need to learn a lesson and support

:02:20. > :02:22.her plans for 1p on tax to support rebates for the low paid. The

:02:23. > :02:25.proposal strip hundreds of millions rebates for the low paid. The

:02:26. > :02:31.of pounds out of vital public services including schools, 50% of

:02:32. > :02:37.what our councils do. I am not prepared for the next generation of

:02:38. > :02:40.children to pay the price of Tory austerity. Members of the GMB union

:02:41. > :02:50.warned that thousands of jobs are at risk from council spending cuts.

:02:51. > :02:56.Scottish ministers' reply is, use a tax rise we see pay rise. Today will

:02:57. > :02:58.help define Scottish politics for the elections in May.

:02:59. > :03:01.I'm joined this afternoon by Andy Maciver, who was formerly

:03:02. > :03:02.Head of Communications for the Scottish Conservatives

:03:03. > :03:15.I think I know what your answers is going to be, but is putting people's

:03:16. > :03:21.taxes up evil twin? No. I can see why they are trying to do this --

:03:22. > :03:26.vote winner. It is a reasonable thing to do at this point but what

:03:27. > :03:30.the strategy fails to grasp of the hangover of constitutional politics

:03:31. > :03:36.we still love. She is trying to move left to attract voters back from the

:03:37. > :03:44.SNP and we are not in a climate where but as possible at the moment.

:03:45. > :03:48.Why? We are still in constitutional politics and people voting SNP are

:03:49. > :03:52.doing so for more than ideological reasons, they are voting for a party

:03:53. > :03:58.that they things done is up for Scotland more than anyone else. The

:03:59. > :04:04.only voters it might attract our left-wing unionists. I do not think

:04:05. > :04:10.it is a vote winner. I do not think it is going to attract anybody knew.

:04:11. > :04:15.It might hold onto some votes. Presumably that applies to the

:04:16. > :04:19.Liberal Democrats as well. Yes. More curious for them to have done it. It

:04:20. > :04:24.is the obvious mode of differentiation to go down for

:04:25. > :04:28.Labour. I was surprised that the Lib Dems did it and I do not

:04:29. > :04:34.Labour. I was surprised that the Lib will do his vote any good. Why is

:04:35. > :04:40.the cure for education... We already spend more per capita than in

:04:41. > :04:45.England on education and the English education system seems to be at the

:04:46. > :04:48.very least as good as the one in Scotland so why spend more money? In

:04:49. > :04:52.the fullness of the next three of Scotland so why spend more money? In

:04:53. > :04:59.four years Michael Gove reforms will make the system much better than the

:05:00. > :05:03.one we have here. Or not. There is no evidence that the cure for

:05:04. > :05:07.education is money. Spending has been going up and education has been

:05:08. > :05:17.getting worse. Reform is required rather than more money. John Swinney

:05:18. > :05:23.is speaking about his budget. A programme that will enhance our

:05:24. > :05:27.social infrastructure and help address climate change. It takes

:05:28. > :05:32.forward a bold and ambitious programme of public sector reform to

:05:33. > :05:36.ensure the sustainability and quality of our services and delivers

:05:37. > :05:42.on our commitments to the people of Scotland at a time of pressure on

:05:43. > :05:46.household incomes. The government proposed a Scottish rate of income

:05:47. > :05:49.tax on the first time. The limited nature of their income tax power

:05:50. > :05:56.available only allows for a single rate be set and then applied to all

:05:57. > :06:02.three income takes rate bands. This means the rate on the wealthiest

:06:03. > :06:06.would apply to the lowest taxpayers. Proposals to increase income tax by

:06:07. > :06:15.1p would hit those taxpayers least able to pay. How does that comment

:06:16. > :06:19.match the comment from last able to pay. How does that comment

:06:20. > :06:24.the Finance committee when he said he viewed the Scottish rate of

:06:25. > :06:28.income tax as the progress of power? Clearly people on higher incomes

:06:29. > :06:38.paid more than those on lower incomes are surely what he has just

:06:39. > :06:39.said is wrong. Order. What I said is that the proposals to increase

:06:40. > :06:45.income tax by 1p next year that the proposals to increase

:06:46. > :06:49.those taxpayers least able to pay. Of course it will, it puts up tax

:06:50. > :06:59.for the lowest paid people in our society. Whether those individuals

:07:00. > :07:08.are newly qualified teachers, they would be hit by this rise, and

:07:09. > :07:12.police officers, firefighters, bus drivers, charity workers, shop

:07:13. > :07:13.workers, hotel workers, workers across the land would see their

:07:14. > :07:20.income tax rise. I wondered if the across the land would see their

:07:21. > :07:26.cabinet secretary would reflect on the fact that teachers are doing

:07:27. > :07:33.their own photocopying, buying jobs as for the classroom. There are no

:07:34. > :07:37.resources and our classroom -- jotters. They might understand why

:07:38. > :07:42.this is being done. Would he welcomed the rebate that we put in

:07:43. > :07:50.place to protect those on the lowest incomes? I want to say to the

:07:51. > :07:57.teachers and public service workers across the country who have had to

:07:58. > :08:02.injure his constraints because of the austerity programme of the

:08:03. > :08:06.United Kingdom government that I value the Cyprus faces they have

:08:07. > :08:15.made and the last thing I am going to do is put up their taxes --

:08:16. > :08:18.sacrifices. She has just raised the issue of the rebate proposal to

:08:19. > :08:24.mitigate the effects of the tax rise. The immediate conclusion to

:08:25. > :08:28.draw from that very announcement of area bit proposal is the recognition

:08:29. > :08:38.that this tax rise is damaging to the incomes of low paid workers. No.

:08:39. > :08:43.Then there are the legislative and practical issues that would have to

:08:44. > :08:50.be quickly overcome to make that concept and reality from April this

:08:51. > :08:54.year. Let us go through the detail. Labour will need to clearly

:08:55. > :09:02.demonstrate the legal basis under which they believes such a payment

:09:03. > :09:06.can be made. Order. Let us hear the Deputy First Minister. I am only

:09:07. > :09:13.going to dismantle Labour's proposal. If it is a tax relief it

:09:14. > :09:18.is outside the powers of the Scottish parliament in relation to

:09:19. > :09:23.income tax has conferred by the Scotland act 2012. If it is a social

:09:24. > :09:26.security payment that is outside the competence of Parliament as defined

:09:27. > :09:33.in the original Scotland act of 1998. Further evidence this proposal

:09:34. > :09:37.is not properly thought through is provided by the lack of clarity

:09:38. > :09:42.about how it would be administered and in particular how it could be

:09:43. > :09:48.done within the ?75 million allocated to this proposal by

:09:49. > :09:52.Labour. An estimated 1 million taxpayers, workers and pensioners

:09:53. > :09:58.could be eligible for the rebate which would cost ?100 million. More

:09:59. > :10:01.than Labour have targeted for the rebate which does not even meet the

:10:02. > :10:07.needs of individuals within our society. The second problem is on

:10:08. > :10:13.top of that the cost of setting up and operating administrative systems

:10:14. > :10:21.by 32 local authorities across Scotland. We know already that it

:10:22. > :10:25.costs local authorities many millions to administer help with

:10:26. > :10:30.council tax bills were Makkah for it is have a lot of information about

:10:31. > :10:34.the circumstances of claimants. The rebate payment is likely to be

:10:35. > :10:40.candid of income tax for tax purposes and those who receive it

:10:41. > :10:44.would be liable to pay tax on it. It does not seem too much to expect

:10:45. > :10:46.those who propose policies of this kind to have at least considered

:10:47. > :10:51.these issues but there kind to have at least considered

:10:52. > :10:56.evidence this happened. The only conclusion we can draw is it is

:10:57. > :10:58.unlikely anyone would receive the rebate on the basis they were

:10:59. > :11:02.offered that proposition to the rebate on the basis they were

:11:03. > :11:07.people of this country. His speech is reminiscent of what we heard from

:11:08. > :11:22.the backbenches yesterday, all about fine as big some detail -- aspects.

:11:23. > :11:29.Order. Let us hear. This is an excuse and not addressing the

:11:30. > :11:33.question of principle. What do you think of the principal of what we

:11:34. > :11:42.are proposing? That politically is important. That was a very relieved

:11:43. > :11:49.revealing intervention. The detail matters. On the 1st of April a

:11:50. > :11:52.citizen of this country who was going to have their tax raised by

:11:53. > :12:00.Labour and will not haven't raised by the SNP would have the right to

:12:01. > :12:05.expect that what has been promised by Labour can actually be delivered.

:12:06. > :12:10.What Jackie Baillie has got to do is explain why the legal practical

:12:11. > :12:18.operational issues that I have raised are somehow overcome by the

:12:19. > :12:26.back of the fag packet which she has written a song. -- this one. This

:12:27. > :12:32.government will deliver a pay rise to around 50,000 of the lowest paid

:12:33. > :12:37.workers in Scotland. The upgrade of the living wages extension to social

:12:38. > :12:43.care workers and uplift of ?400 for those covered by public sector pay

:12:44. > :12:48.policy earning ?22,000 less will see tens of thousands better off because

:12:49. > :12:53.of this budget. That is the difference between the SNP and

:12:54. > :13:02.Labour. We want to give the lowest paid a pay rise and Labour want to

:13:03. > :13:07.give them a tax rise. I understand he was too busy to come out to the

:13:08. > :13:14.parliament today to talk to local government workers who were lobbying

:13:15. > :13:18.outside Parliament. Since he has reiterated that he has said this

:13:19. > :13:22.against any increase in tax what is his message to the 16,000 local

:13:23. > :13:32.government workers liable to lose their jobs as a result of ?500

:13:33. > :13:36.million of cuts? The SNP is determined to protect their income

:13:37. > :13:49.is not punished them with a tax rise that the Labour Party is coming out

:13:50. > :13:58.with. This budget reaffirms... No afternoon would be complete without

:13:59. > :14:07.him. It is simple, how can you protect their income when they do

:14:08. > :14:12.have a job? Let us hear the Deputy First Minister. This is the

:14:13. > :14:15.government that has given public sector workers the guarantee of no

:14:16. > :14:22.compulsory redundancies. That is what we have given the people of

:14:23. > :14:26.this country. This budget reaffirms our commitment to deliver in growth

:14:27. > :14:32.through investment in education and skills. Almost ?5 billion is

:14:33. > :14:35.invested annually in delivering school education with averages spent

:14:36. > :14:44.at your power pupil hired in Scotland than in England. It will

:14:45. > :14:47.reach ?13 billion. We will protect the budget in Scotland and ensure

:14:48. > :14:53.that higher education spending is over ?1 billion in 2016-2017. That

:14:54. > :14:57.was John Swinney. The Finance Secretary

:14:58. > :14:58.John Swinney there. We'll have more from the chamber

:14:59. > :15:01.later in the programme. David Cameron has made

:15:02. > :15:03.a statement to the Commons, outlining his draft deal

:15:04. > :15:05.with the European Union on reforming The Labour Leader, Jeremy Corbyn,

:15:06. > :15:09.criticised his efforts, saying he'd negotiated

:15:10. > :15:11."the wrong goals, in the wrong But the Prime Minister

:15:12. > :15:14.insisted his fresh settlement would ensure Europe

:15:15. > :15:22.works for Britain. If we stay, Britain will be in there

:15:23. > :15:29.keeping a lid on the budget, shopping away unnecessary regulation

:15:30. > :15:33.and securing the commitments. Ensuring that Britain can have the

:15:34. > :15:36.and securing the commitments. best of both worlds. In the parts of

:15:37. > :15:40.Europe that work for us and out of those that don't. In the single

:15:41. > :15:47.market free to travel around Europe free to travel around where Britain

:15:48. > :15:51.and its partners can be safer and more prosperous but with guarantees

:15:52. > :16:00.we will never be part of the Europa, never part of a European army --

:16:01. > :16:06.euro. And never be part of a European superstate. That is a path

:16:07. > :16:11.that can lead to a fresh settlement for Britain and a reformed European

:16:12. > :16:16.Union that will offer the best future for jobs, security, and

:16:17. > :16:20.strengthen our country. A settlement which will offer families security

:16:21. > :16:29.at every stage of their lives. That is what we are fighting for.

:16:30. > :16:36.not a full and reader Prime Minister's ended up exactly where he

:16:37. > :16:42.would be, making the case to remain in Europe which is what was always

:16:43. > :16:47.intended, despite renegotiating spectacle, choreographed for TV

:16:48. > :16:50.cameras all over the continent. Mr Speaker, as his own backbenchers

:16:51. > :16:54.keep telling us, the proposals from the European council are simply

:16:55. > :16:59.tinkering round the edges. They have little impact of the EU delivers for

:17:00. > :17:05.tinkering round the edges. They have Britain's workers and businesses. We

:17:06. > :17:10.welcome proposals for a veto over commission legislation, even if it's

:17:11. > :17:13.heavily qualified, it seems the Prime Minister has moved towards the

:17:14. > :17:20.Labour Party's view on this issue and we welcome him to that.

:17:21. > :17:27.Protecting non-Eurozone states is necessary, but we cannot let these

:17:28. > :17:30.opposable is hamper efforts to regulate the financial sector,

:17:31. > :17:37.including bankers' bonuses. The crucial detail the emergency brake

:17:38. > :17:42.for EU migrants is to entirely absent. When is that information

:17:43. > :17:46.going to be made available? In any case, the Prime Minister calls the

:17:47. > :17:50.strongest package ever on abuse of free movement doesn't begin to

:17:51. > :18:01.tackle the real problem of the impact of migration on communities

:18:02. > :18:05.and wages. First Minister of Northern Ireland has rendered the

:18:06. > :18:09.Minister today. They see the following, and I think honourable

:18:10. > :18:14.Right Honourable members should listen. We believe that hoping a

:18:15. > :18:20.referendum as early as June will maim that a significant part of the

:18:21. > :18:27.referendum campaign won't necessarily run in parallel and risk

:18:28. > :18:31.confusion when clarity is required. We believe that the European

:18:32. > :18:34.referendum is of vital importance that the whole of the United

:18:35. > :18:38.Kingdom, and the debate leading up to it should be free of other

:18:39. > :18:41.Kingdom, and the debate leading up campaigning distractions. We believe

:18:42. > :18:47.it would be better for you, the Prime Minister to commit to a

:18:48. > :18:55.referendum later in the year. So, will the Prime Minister take the

:18:56. > :18:58.agility and confirm that he will be respectful of the governments of

:18:59. > :19:03.Scotland, Wales and Northern Ireland and defer until June? We were

:19:04. > :19:09.promised we would deal with the excessive immigrant numbers, which

:19:10. > :19:15.is now being dealt with a European court of human just it -- European

:19:16. > :19:22.court of justice. We were told that these would be legally binding, and

:19:23. > :19:29.also irreversible. But, now it will be stitched up by a political

:19:30. > :19:35.decision, by the European council and not by a guaranteed treaty

:19:36. > :19:39.change, at the right time, and this, I had to say to the Prime

:19:40. > :19:40.change, at the right time, and this, is a wholly inappropriate way of

:19:41. > :19:43.dealing with this matter. Our Westminster Correspondent David

:19:44. > :19:46.Porter and his panel of parliamentarians

:19:47. > :19:58.were listening to that. No prizes for guessing what we'll be

:19:59. > :20:04.talking about this week. Let me introduce, Malcolm Bruce, Lord

:20:05. > :20:11.Bruce, Ian Murray for Labour, Drew Hendry for the SNP. First of all,

:20:12. > :20:16.Drew, you asked a question today and you got a telling off from the

:20:17. > :20:23.Speaker. You got a telling off, what was that about? You get told off for

:20:24. > :20:29.going out to votes. I've spoken to the Speaker and we've cleared that

:20:30. > :20:33.up. I'm glad your no longer on the naughty step. Let's move to Europe.

:20:34. > :20:38.The Prime Minister says it's an important milestone, this deal, that

:20:39. > :20:46.he is negotiated. Your party wants to stay in the EU but you don't want

:20:47. > :20:49.the vote as many people? It's disrespectful to the Scottish, Welsh

:20:50. > :20:53.and Northern Ireland Parliament during a time when elections are

:20:54. > :20:57.going on for those bodies. I think people need to have a clear view,

:20:58. > :21:01.understanding of the issues will be voting on in Europe and this is the

:21:02. > :21:03.wrong time to muddy the waters with this kind of panic exercise to make

:21:04. > :21:07.sure they can get something through this kind of panic exercise to make

:21:08. > :21:13.as quickly as they possibly can. But there could be 6-7 weeks between the

:21:14. > :21:18.Scottish elections and any EU bikes. Surely voters can consider two

:21:19. > :21:23.things at one time, can't make? What they can can clearly consider

:21:24. > :21:26.different things, but if you consider the Scottish Referendum

:21:27. > :21:34.they had time to discuss the issues. People are being given no such time

:21:35. > :21:37.with this issue. June 23 is this -- disrespectful to all the assemblies,

:21:38. > :21:41.to the Scottish Government, and the London mayor elections to be

:21:42. > :21:50.happening at the same time. We need clarity. This affects every single

:21:51. > :21:56.person, their incomes, their future. Do you buy this argument that if

:21:57. > :21:59.David Cameron decides to go forging the 23rd is being disrespectful to

:22:00. > :22:05.Scotland? I don't think it is a tall, and the first thing to bear in

:22:06. > :22:12.mind we don't yet have a negotiation or a date. But if it's June 23, I

:22:13. > :22:15.think it's a bit insulting to the Scottish Electric to say that they

:22:16. > :22:20.cannot digester European arguments which had been going around for

:22:21. > :22:27.years, in a period of six weeks. Alex Salmond said that it's a

:22:28. > :22:33.sensible time. It's within the time gap that he set out side ending is

:22:34. > :22:41.being this respectful. Ian Murray, what about this timing issue. Your

:22:42. > :22:53.leader once the referendum soon and if it's June then, so be it? Week in

:22:54. > :22:59.re has -- re-rehearsing this argument. Let's get on with having

:23:00. > :23:04.those arguments, making sure that the people across United Kingdom now

:23:05. > :23:09.the strength of those arguments and get into the polling station. The

:23:10. > :23:18.last thing we need is another paused referendum, where it goes round and

:23:19. > :23:21.damages the economy of the UK, and the -- and Scotland. Let's start

:23:22. > :23:28.talking about process and benefits of staying in. Do you have any

:23:29. > :23:31.problems with a date? The pro Minister can't carry his party with

:23:32. > :23:36.him, because they are split over it. The sooner it happens the better.

:23:37. > :23:42.The good of the country, for this issue to be resolved, we need to

:23:43. > :23:46.know what's involved, so I think it should be possible to decide that

:23:47. > :23:51.issue at the end of June. And I rather agree that running it all

:23:52. > :23:55.through the summer would damage business confidence, create greater

:23:56. > :24:01.uncertainty. I don't think I would be prepared to put my party's

:24:02. > :24:06.interest about the nation. Unfortunately, the dryness does the

:24:07. > :24:10.everyday. The deal that David Cameron has outlined, with a few

:24:11. > :24:11.everyday. The deal that David nips and tucks, that will be the

:24:12. > :24:18.deal that Europe agreed to. Is it good enough? It won't be given at

:24:19. > :24:23.the Eurosceptics. It likes Scottish Nationalists, it's never enough.

:24:24. > :24:26.the Eurosceptics. It likes Scottish They want outcome of the Scottish

:24:27. > :24:28.Nationalists want out, but for most people, they had to balance the view

:24:29. > :24:35.that there's been some good will towards the UK. Fundamentally, in

:24:36. > :24:41.the end, we have to decide whether we go to be part of adventure or

:24:42. > :24:43.leave it. We don't really want to face up to the consequences, because

:24:44. > :24:51.nobody really knows, if we'd leave. face up to the consequences, because

:24:52. > :24:57.You will live with this deal if the Prime Minister is the best it can

:24:58. > :25:02.get? If he can convince the UK Electric that we can stay in Europe

:25:03. > :25:06.then sat that particular argument. He hasn't touched the issues of

:25:07. > :25:13.holiday pay, maternity leave, though socialist issues being stripped

:25:14. > :25:16.away. There are pros and cons, and there are many more prize of staying

:25:17. > :25:22.within the European Union, and Malcolm is right, the Europe

:25:23. > :25:26.sceptics that once out, nothing will ever please them. Let's get the

:25:27. > :25:30.referendum outweighs quickly as possible. The Prime Minister is

:25:31. > :25:37.trying to fix his party and not the country. When not in the euro, were

:25:38. > :25:43.not in Schengen arts we need to create alliances from inside the

:25:44. > :25:47.tent rather than outside. This is more about the Prime Minister try to

:25:48. > :25:55.fix his party rather than get a deal for Europe? There are 20 of Labour

:25:56. > :26:01.members of Parliament about the campaign to leave Europe. It cuts

:26:02. > :26:05.across all political parties. Where I agree with Ian Malcolm is that

:26:06. > :26:14.this is an issue where you have to weigh up pros and cons. Most of us

:26:15. > :26:18.have put the the pros and cons. I'm currently undecided. The deal that

:26:19. > :26:22.the pro Minister has negotiated, if that's what's finally agreed will be

:26:23. > :26:27.a big improvement on what we have now, but we also have to face up,

:26:28. > :26:31.this is a global issue. What is Britain's role in the world? The

:26:32. > :26:38.generations to come. That's what we need to resolve. It makes it sound

:26:39. > :26:42.though, that you're not entirely convinced by the deal that the pro

:26:43. > :26:45.Minister has put forward? This is my individual perspective. What I want

:26:46. > :26:51.to get us back to is a common market. If you go shedding gets us

:26:52. > :26:55.further towards that... But I want to see the small print, which will

:26:56. > :27:03.be most important. I say, this is a once in a generation chance. I was

:27:04. > :27:05.three when a last referendum happen. We must settle it the next

:27:06. > :27:12.generation, have a proper debate, way up pros and cons. All our votes

:27:13. > :27:15.will have the same lecture in power as the rest of the country. We need

:27:16. > :27:21.to decide our future and let's get on with it. Drew Hendry, whatever

:27:22. > :27:25.the date is, whether it's June or put back to September, this is such

:27:26. > :27:30.an important issue, that with all due respect to the other elections

:27:31. > :27:34.which take place, it's going to overshadow everything, isn't it?

:27:35. > :27:37.That's twice part of the problem. That's why is this respectful to the

:27:38. > :27:42.rest of the governments and assemblies that are having

:27:43. > :27:47.elections. This issue of the EU, it's not perfect, nobody is saying

:27:48. > :27:52.that, it there are things that need to be done with it. Nobody is

:27:53. > :27:57.convinced by David Cameron's argument. What's important is that

:27:58. > :28:05.Scotland benefits from being in the EU, and the EU benefits from

:28:06. > :28:08.Scotland benefits from being in the Scotland as a member. We need to

:28:09. > :28:11.know the impact this will have, as you have that at the same time when

:28:12. > :28:17.we got the Scottish elections going on is very bad. Is it right that

:28:18. > :28:22.because this is such a big constitutional issue, that it will

:28:23. > :28:31.dominate editing? We have a mature enough electric -- Electric and --

:28:32. > :28:39.electorate and media that they will be a substantial periods between the

:28:40. > :28:44.elections that that will be inadequate time to weigh up as a

:28:45. > :28:49.country and make our decision. We had enough time, Ian Murray, if the

:28:50. > :28:57.pro Minister wanted to go even sooner? The electorate are

:28:58. > :29:02.intelligent enough to work out the issues that are important to them. I

:29:03. > :29:11.would have thought that Drew Hendry would have want -- wanted to get

:29:12. > :29:16.that moving so he doesn't have two answer how terrible his Government

:29:17. > :29:21.have made Scotland. Once the elections are closed down, they can

:29:22. > :29:26.move on to the arguments about the Scottish elections. Do you think

:29:27. > :29:31.it's one of those issues that he will have already made their mind up

:29:32. > :29:36.about? Six weeks seem to be long enough. The question is, do we stay

:29:37. > :29:38.or do we leave? I think if people are going to engage with this debate

:29:39. > :29:44.they can do it in six weeks. Do we are going to engage with this debate

:29:45. > :29:46.stay or do we leave? Gentlemen, we are going to leave and we are going

:29:47. > :30:08.to return to the studio. What about having the referendum six

:30:09. > :30:12.weeks after a Scottish election will. No leader up here, I can't

:30:13. > :30:20.figure many parliamentarians who actually want exit the EU. So it's

:30:21. > :30:23.not really... You can't see that topic overshadowing the Scottish

:30:24. > :30:26.elections, because everyone things the same way in it. So I actually

:30:27. > :30:33.don't think it's going to be that big a deal. I think it will be seven

:30:34. > :30:37.weeks, not six. In seven weeks is a reasonably long time. If you think

:30:38. > :30:41.about the independence referendum campaign, it in get very, very

:30:42. > :30:46.heated until quite near the end, so I think it's probably OK. I don't

:30:47. > :30:51.see overshadowing the Scottish elections much. What did you make of

:30:52. > :30:58.what happened in the count -- House of Commons today? I was expecting

:30:59. > :31:05.very impassioned speeches by the Eurosceptics on the Tory side and it

:31:06. > :31:11.seemed a little bit muted. They looked a bit out of puff. The deal

:31:12. > :31:16.that Cameron has reached is quite superficial. If you look at what he

:31:17. > :31:22.was promising before and what his rhetoric was today. He's saying we

:31:23. > :31:24.won't have to join Schengen, being the European army, none of these

:31:25. > :31:29.things were going to happen, so you think it would be a reasonable day

:31:30. > :31:34.for Eurosceptics to put a little bit of bite into what they were saying,

:31:35. > :31:40.but I don't think they organise themselves enough. They can't decide

:31:41. > :31:48.what campaign is going to be official. They're just not together.

:31:49. > :31:53.We had Liam Fox, OK, he may have Liam Fox was though he's got other

:31:54. > :31:59.irons in a fire, but Bill Cash? His very existence is to do with getting

:32:00. > :32:04.out the European Union. It sees -- it should be his moment? It looks

:32:05. > :32:11.like they lost a bit of a PR war this weekend. There was a lot of

:32:12. > :32:15.Cameron backing away from deals, and new lease is going out saying deals

:32:16. > :32:20.were going ahead. But actually, if you look at the substance of it...

:32:21. > :32:25.They'll be hoping for a big figure to lead to big get out campaign. It

:32:26. > :32:30.looks like it's not going to be Theresa May. I don't think it will

:32:31. > :32:31.be Boris Johnson, either. So you start to wonder where that big

:32:32. > :32:43.figure is actually going to come People who want to stay in the EU

:32:44. > :32:48.want this out of the way quickly. There is probably an underlying bias

:32:49. > :32:53.against staying in in the polls so they are probably further ahead than

:32:54. > :32:55.the polls say they are. The people who are for the EU want this done

:32:56. > :32:58.and to move on. Back to the Chamber now,

:32:59. > :33:00.where the Scottish Government's budget is up for debate

:33:01. > :33:02.this afternoon. The Finance Secretary has pledged

:33:03. > :33:04.not to change income tax rates but Labour and the Lib Dems are both

:33:05. > :33:20.pushing for a 1p increase Kenneth Gibson is speaking on behalf

:33:21. > :33:23.of the finance committee. Expert witnesses have explained how

:33:24. > :33:27.taxpayers could be expected to change their behaviour in response

:33:28. > :33:31.to tax changes. Evidence suggests that higher rates of income tax are

:33:32. > :33:38.likely to lead to behaviours that impact negatively. Including tax

:33:39. > :33:41.avoidance and migration. These are particularly important in relation

:33:42. > :33:46.to high earners who are more likely to have the means and mobility to

:33:47. > :33:50.change their behaviour in response to tax changes. The highest

:33:51. > :33:53.change their behaviour in response more than half of income tax

:33:54. > :33:58.revenues while the top 1% contributes a fifth. 11,000

:33:59. > :34:05.additional rate taxpayers are in Scotland. Such a large proportion of

:34:06. > :34:11.tax revenue depends on a small number of taxpayers. It is

:34:12. > :34:17.imperative the impact is assessed before are made. The intention

:34:18. > :34:22.underlying will be responsible for raising more of the money than it

:34:23. > :34:27.spends that be accountable to the electorate. A large part of this

:34:28. > :34:29.income will continue to be dependent and the members will know the

:34:30. > :34:37.mechanism by which it will be reduced is of supreme and

:34:38. > :34:40.importance. We have raised concerns about the impact of relative

:34:41. > :34:45.population growth on the adjustment and we welcome the fact that the

:34:46. > :34:48.Deputy First Minister supports the index deduction per capita method

:34:49. > :34:52.and we recommend this is a great within a fiscal framework that will

:34:53. > :34:58.underpin the devolution settlement. Time is of the essence of Parliament

:34:59. > :35:02.is to scrutinise it Parliament to do solution. We look forward to

:35:03. > :35:11.questioning the finance minister in the coming weeks to consider if

:35:12. > :35:16.these criteria are met and it meets the no detriment principle. The

:35:17. > :35:20.finance committee has consistently raised concerns about the lack of

:35:21. > :35:25.transparency arising from the devolution of financial powers I

:35:26. > :35:28.believe that full transparency is essential to secure public

:35:29. > :35:32.confidence. It is imperative that the fiscal framework contains

:35:33. > :35:41.detailed explanations of how it will be adjusted. Regarding already

:35:42. > :35:43.devolved tax we have followed operations regarding land and

:35:44. > :35:47.buildings transaction tax. Stakeholders raised concerns that it

:35:48. > :35:49.had a negative effect on sales of the higher end of the property

:35:50. > :35:54.market. It is not possible the higher end of the property

:35:55. > :35:57.assess the impact without full year figures but indications are that

:35:58. > :36:07.high value sales are returning to previous levels. We are supportive

:36:08. > :36:12.of the proposal to maintain the current rates and bands. We

:36:13. > :36:18.recommend that the government conducts and publishes a review once

:36:19. > :36:22.the figures for the first year of operation become available. This

:36:23. > :36:28.will assist Parliament in its scrutiny of next year's proposals.

:36:29. > :36:35.The committee takes 18 interest in the Scottish Fiscal Commission's

:36:36. > :36:40.work. Discussions take place next week. I look forward to discussing

:36:41. > :36:44.issues raised and do not intend to discuss the commission outlined

:36:45. > :36:48.today but reiterate a recommendation that later acquire is needed on the

:36:49. > :36:57.role of the commission and how it works in practice and how it was

:36:58. > :37:01.agreed -- to agree the forecasting. We invited written evidence on how

:37:02. > :37:09.successful the Scottish futures trust is. To improve the efficiency

:37:10. > :37:14.by working collaboratively with public bodies and industry leading

:37:15. > :37:19.to better value for money and public services. The overwhelming majority

:37:20. > :37:21.of responses were positive and indicated a high level of regard for

:37:22. > :37:26.the staff and collaborative approach. Suggestions were also made

:37:27. > :37:36.and we look forward to hearing their views. Staying with capital

:37:37. > :37:41.investment, the European system of accounts regulations which have led

:37:42. > :37:52.to certain nonprofit distribution projects being reclassified as

:37:53. > :37:56.public sector spending. ?398 million was allocated to cover projects and

:37:57. > :38:01.full transparency is required particularly where it resulted to

:38:02. > :38:05.the latest other investment projects. This is relevant to those

:38:06. > :38:08.fiscal framework negotiations related to additional borrowing

:38:09. > :38:13.powers and we would welcome an update. The committee continues to

:38:14. > :38:19.scrutinise the government's commitment. While there is evidence

:38:20. > :38:22.of progress the committee remains frustrated by the lack of evidence

:38:23. > :38:29.of any large-scale shift towards prevention. We received 40 responses

:38:30. > :38:33.to our calls for evidence of barriers including a lack of

:38:34. > :38:36.to our calls for evidence of ownership among public sector

:38:37. > :38:39.partners. If the shift does not take place we will have growing demands

:38:40. > :38:43.for services against the backdrop of diminishing resources. The committee

:38:44. > :38:52.would need to take further evidence on prevention before reporting

:38:53. > :38:55.conclusions. The budget focused on accountability and processes. Many

:38:56. > :38:59.other topics were also covered and I am sure will be raised later. I hope

:39:00. > :39:05.to have given a flavour of the broad range of subjects considered by the

:39:06. > :39:17.finance committee. I look forward to hearing from other members. Maximum

:39:18. > :39:20.six minutes. The Deputy First Minister is fond of telling us the

:39:21. > :39:24.extent to which he is a victim of so-called Tory austerity from

:39:25. > :39:28.Westminster so I thought it would be useful to add buys were the total

:39:29. > :39:36.budget stands in relation to previous years. The total budget for

:39:37. > :39:41.2016-2017 will be higher in real terms than in every year of

:39:42. > :39:51.devolution from 1999 until 2007, higher in each of the year 2011, 20

:39:52. > :39:54.12-2013 and 2013-2014 and nearly ?400 million higher than the current

:39:55. > :39:59.year. The Scottish Government will always complain they do not have

:40:00. > :40:04.enough money and always put the blame at Westminster. The difference

:40:05. > :40:06.in this budget is that the finance secretary couldn't make the choice

:40:07. > :40:15.if he wished to increase taxation and chose not to do so -- could have

:40:16. > :40:20.made the choice. In 1999 a fresh faced John Swinney was the architect

:40:21. > :40:25.of the penny for Scotland campaign. It is with irony we are year and

:40:26. > :40:28.that campaign has been taken up by Labour and the Liberal Democrats and

:40:29. > :40:37.John Swinney is holding the line against increases in income tax. I

:40:38. > :40:45.will not. He is right to do so. The members said no. People in Scotland

:40:46. > :40:50.should not be more highly taxed than people in the rest of the UK.

:40:51. > :40:57.Sometimes that was a lonely message to boot out but no more. It makes me

:40:58. > :41:02.glad to hear these self-proclaimed social Democrats and political

:41:03. > :41:04.progressives on the SNP benches arguing so vigorously and

:41:05. > :41:14.passionately against increases in taxation. We on the Conservative

:41:15. > :41:18.benches will stand shoulder to shoulder with the SNP in holding the

:41:19. > :41:23.line against the tax grabbers on the Labour benches and the Liberal

:41:24. > :41:27.Democrat benches who would punish Scottish families. We are happy to

:41:28. > :41:34.be Better Together with the SNP, to coin a phrase. The SNP can hardly

:41:35. > :41:41.complain about Tory austerity when they had the choice to do otherwise.

:41:42. > :41:44.What this means is that in the coming election those who are

:41:45. > :41:48.unionist and those who voted no in the referendum, there is only one

:41:49. > :41:50.party which will protect their pockets and

:41:51. > :42:03.party which will protect their that of the Scottish Conservatives.

:42:04. > :42:13.-- and that is. Order. Willie rainy. Tax grabber. ?189 million in tax

:42:14. > :42:17.cuts and spending increases. I can only see ?50 million worth of cuts

:42:18. > :42:24.to the bus pass. Where has the rest of the money come from and how is he

:42:25. > :42:34.going to be for it? He could have seen if he had studied it in detail,

:42:35. > :42:43.?42 million behind projections they are, so we think some of the sons --

:42:44. > :42:48.his sons are wrong. He will see that we have a package of proposals. I

:42:49. > :42:53.will spell out in more detail by these are important. Our priority

:42:54. > :42:57.should be the Scottish economy. A strong and vibrant economy is

:42:58. > :43:01.essential for the benefit of the people of Scotland and for

:43:02. > :43:04.generating the tax income the Scottish Government requires and

:43:05. > :43:08.this will be important in the coming year and subsequent years as a

:43:09. > :43:12.closer link between Scotland's economic performance and the

:43:13. > :43:18.Scottish Government's tax take is established. We have proposed a

:43:19. > :43:21.number of changes. We are concerned about the increase in nondomestic

:43:22. > :43:29.rates with the doubling of a large domestic supplement to 2.6%. This

:43:30. > :43:31.will hit many relatively modest businesses applying to properties

:43:32. > :43:41.with erect a ball value of ?35,000 or more. The First Minister has told

:43:42. > :43:46.she wishes to see Scotland become the most competitive part of the UK

:43:47. > :43:49.in which to do business. Having a supplementary rate doubled that

:43:50. > :43:52.payable south of the border lies in the face of this.

:43:53. > :43:55.The Conservatives' Murdo Fraser there.

:43:56. > :43:58.Negotiations are continuing between the Scottish and UK

:43:59. > :44:00.governments in an effort to agree on the fiscal framework

:44:01. > :44:06.The Chief Secretary to the Treasury, Greg Hands, has been giving evidence

:44:07. > :44:08.to the Scottish Affairs Committee at Westminster this afternoon.

:44:09. > :44:15.Put simply this means that neither Scotland or the rest of the UK

:44:16. > :44:20.should be better or worse off as a result of the initial act of

:44:21. > :44:23.devolution. Thereafter the Scottish Government should bear the fruit of

:44:24. > :44:31.good policy decisions and the consequences of poor policy

:44:32. > :44:36.decisions. David Porter has been following the story. Can you cast

:44:37. > :44:43.any light, this is a complicated subject, on what he said which

:44:44. > :44:47.eliminated what these discussions are about? You are right, these

:44:48. > :44:53.discussions are very complicated and have had eight sets of talks. Greg

:44:54. > :44:57.hands announced that he would be clearing his diary and going to

:44:58. > :45:00.Edinburgh on Monday at the night session of talks to try to get a

:45:01. > :45:08.deal which could go on longer than that. It underpins the way that

:45:09. > :45:12.further devolution will work. To some extent it is more important in

:45:13. > :45:17.financial and economic terms than a lot of what is in the Scotland bill

:45:18. > :45:22.because it will help determine the financial mechanism that will decide

:45:23. > :45:27.the amount of the block grant in future, how much Westminster will

:45:28. > :45:32.send to Holyrood and how that could change over time. It is very

:45:33. > :45:36.important and intricate. Where the difficulty seems to be and this

:45:37. > :45:39.sticking point between the UK and Scottish governments is whether you

:45:40. > :45:45.index linked in future the way that the payments will be made therefore

:45:46. > :45:48.of the population did not grow as much in Scotland would Scotland be

:45:49. > :45:52.disadvantaged by changes to the Barnett formula? Lots of clever

:45:53. > :45:58.people with politicians have been trying to square the circle and have

:45:59. > :46:03.not done it. The clock is ticking. They need to get agreement by the

:46:04. > :46:07.end of next week. If not it could make it very hard see the Scottish

:46:08. > :46:11.Government to get everything that needs to be done in time for the

:46:12. > :46:17.Scottish elections and to get the Scotland bill on the statute. There

:46:18. > :46:19.will be a lot of hard negotiating next week and if they get a deal it

:46:20. > :46:29.will probably go down to the wire. from what was the tone of his

:46:30. > :46:34.remarks? Did he say we could get this sorted out? He did tell

:46:35. > :46:35.remarks? Did he say we could get committee that he believed they

:46:36. > :46:41.could reach a deal, but he says there's got to be goodwill on both

:46:42. > :46:46.sides. I spoke to him earlier this week after the discussions, a little

:46:47. > :46:51.earlier in the week, at the Treasury. He sounded quite upbeat,

:46:52. > :46:55.perhaps a little bit more upbeat in -- than John Swinney did when he

:46:56. > :46:58.came out of the meeting, but in many ways, this is

:46:59. > :47:02.came out of the meeting, but in many is turning into a game of poker,

:47:03. > :47:07.where perhaps neither side wants to give all their ideas on what they

:47:08. > :47:13.will will not talk about at the moment. Both sides are both saying

:47:14. > :47:17.they refused to give a running commentary. I think both sides want

:47:18. > :47:22.to get a deal on this one, but it has to be a deal that is good for

:47:23. > :47:23.both Westminster and for Holyrood. And that might be easier said than

:47:24. > :47:29.done. Banks David, we will let you get

:47:30. > :47:33.back to your deckchair! Time for some final thoughts

:47:34. > :47:43.from Andy Maciver. You don't want a situation where

:47:44. > :47:46.Scotland was following through, whether Scottish Government starts

:47:47. > :47:51.losing money, on the other hand you can't have a situation where the

:47:52. > :47:54.Scottish have and make some policy decisions which adversely affect the

:47:55. > :48:00.economy, and doesn't have to take responsibility for or that,

:48:01. > :48:04.there effectively getting subsidy. This is wedded to detrimental clause

:48:05. > :48:08.becomes difficult, and very difficult to meet. One of the

:48:09. > :48:12.positives is that you can make the difficult to meet. One of the

:48:13. > :48:17.outcome different from another part of the UK. It's difficult to make

:48:18. > :48:21.that clause. I think there will be a deal, I don't think they'd seen in

:48:22. > :48:27.anyone's interest for their not to be. David Bell, the Economist, who

:48:28. > :48:35.dreams about this in his state, he argued in detail paper he's produced

:48:36. > :48:41.for the Institute For Fiscal Studies that there is no way of meeting

:48:42. > :48:46.everything because of no detriment? Yeah. I think there'll effectively

:48:47. > :48:53.come out with something that has an outcome which is very similar to

:48:54. > :48:56.Barnet. People are going to be exposed to the detail on this unless

:48:57. > :49:03.they're going to search it out. There will be a big PR battle for

:49:04. > :49:07.who wins. Has the SNP secured a great deal for Scotland? And if they

:49:08. > :49:14.get something like the Barnett Formula, or better... How do you go

:49:15. > :49:18.about indexing? And who takes responsibility for things going

:49:19. > :49:30.wrong, things changing? On either side? One of the options that you do

:49:31. > :49:34.for that extra part, the part decreasing the Barnett Formula

:49:35. > :49:41.grants, how you get that top part is very similar to Barnet. So I think

:49:42. > :49:45.the Scottish Government have it -- has its preferred model. I think

:49:46. > :49:52.there would be something relatively similar in place to the Barnett

:49:53. > :49:56.Formula. There are areas around the world's... In federal states, there

:49:57. > :50:05.are still fiscal transfers, whereby the richer parts of the country

:50:06. > :50:12.transfer money to poorer parts. Clearly, they'll be able to do it.

:50:13. > :50:16.The tricky part, as David Bell and I say, is trying to meet the no

:50:17. > :50:21.detriment clause, because it's hard to see how they would be detriment

:50:22. > :50:28.from any settlement to Scotland are other parts of the UK that will

:50:29. > :50:32.happen. Regarding the debate on tax, has it changed your mind any about

:50:33. > :50:37.putting up taxes being a vote winner? I don't think so. The one

:50:38. > :50:42.party in Scotland who knows how to win votes is the SNP. They haven't

:50:43. > :50:48.raised taxes since they've been in Government, they've only raised land

:50:49. > :50:54.building transaction tax which replaced Stan GT. The reason they

:50:55. > :50:59.haven't done that is because they are not popular, and there's not

:51:00. > :51:01.much evidence that they're actually necessary in Scotland, because

:51:02. > :51:06.public services have continued reasonably well under austerity and

:51:07. > :51:12.John Swinney thinks he can carry on doing that without raising taxes.

:51:13. > :51:16.I'll be back with Sunday Politics Scotland, on Sunday at 11am.