: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.