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Chamber and committees

Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 5 May 2021
  6. Current session: 12 May 2021 to 17 June 2025
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Displaying 1574 contributions

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Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

You mentioned tomorrow鈥檚 UK spending review. What discussions have you had with the Government about a Scottish spending review?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

Do you think that there should be a Scottish spending review? Would it be prudent to have a Scottish spending review?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

I also understand that鈥攖hat is well recognised. However, that does not change the fact that we should be concerned about the figures that I mentioned. Are you more or less concerned than you were 12 months ago about the broad picture that you have painted in your update?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

I suppose that I am talking about whether it is possible on a technical level. Do you think that that is achievable, as opposed to desirable? I understand that there is a lot of politics in this, and I do not want to draw you on that, but, on a technical level, do you think that it would be possible to have a spending review?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

So, the Government does not supply you with any of its working on evaluating whether it should adopt a certain policy approach. I understand your point about motivation, but that is not really what my question is about. We can agree about the motivation behind a policy but move on to decide the most effective approach. From what Mr Davidson described, deep complexity surrounds the behavioural effects, the thresholds, the timing of when people exit, and how all those factors are combined. However, you say that you were not provided with any working on the assumptions that the Government had made in choosing its approach.

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

With regard to your evaluating the fiscal impacts of the approach, you will understand that one of the committee鈥檚 interests concerns the effectiveness of the approach that is chosen. That side of it is interesting.

Let us move on to the economic performance gap. In 2022-23, it was 拢624 million; in December 2024, it was 拢838 million; and, in May 2025, it was 拢1.06 billion, so it is clear that it has been increasing significantly over the past two years.

In addition, to pick up on what colleagues said about the negative income tax reconciliation, that has grown by 20 per cent in the past six months. I understand some of the factors that are involved in that. Are you concerned about the fact that, as a result of all those different factors, the Scottish Government appears to have a growing gap across those different areas?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

If we get ourselves into a position in which we undertake a spending review after the election in 2026, we will, as you said, be approaching the midpoint of the UK Government鈥檚 spending review cycle. There has been a lot of discussion about the problems with an MTFS, because events come along and things change. In your view, should the Government simply get ahead and get it done? Would that be the best thing to do to address the strategic challenges that you have set out in your report?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

For my last question, I want to go back to the issue of productivity. You mentioned that capital investment is comparatively lower in Scotland. I attended an excellent conference on Friday, at which I chaired a session, but there was one thing that I found slightly puzzling, so I will ask the question that I did not get answered then. It relates to the availability of capital to firms in Scotland.

Prior to the Ukraine crisis, companies and firms would tell me that the availability of capital was not the problem, because capital was relatively cheap for a long period of time. Because of low interest rates, it was accessible. Interest rates have now increased and it is a bit more difficult for firms to access capital. However, access to capital is a long-term problem; it is not just a short-term problem, following the invasion of Ukraine. In a marketplace in which capital was cheap, Scottish firms were still underinvesting in capital and productivity. Can you say why that is a problem?

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

I am glad that you do not take their homework as read.

Finance and Public Administration Committee [Draft]

Scottish Fiscal Commission (Economic and Fiscal Forecasts)

Meeting date: 10 June 2025

Michael Marra

The comparison that was drawn between the amount of capital that we retain in-country and the amount that other developed nations retain was a striking one. I was also struck by the situation with regard to the ability of firms to mobilise capital and the absorptive capacity of the economy to use that capital effectively. It strikes me that you are saying that the issue is partly to do with the behaviour of firms and whether they are risk averse in relation to investing here rather than elsewhere. Is there anything that we could do to address those issues, rather than simply addressing the question of capital flows?