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The implications of the United Kingdom Government’s mini-budget last Friday in Barnett consequentials for this financial year—I stress that the conversation that we are having is just about this financial year—total £35 million. Those are a consequence of the changes that are being made in stamp duty.

I have taken no decisions about the consequentials. I am, to say the least, uncertain about whether the changes that were made last Friday will come to pass, given the fact that enormous market volatility is being experienced. However, that is the available impact on this financial year and I will consider those questions as I formulate the provisions around the emergency budget review.

For completeness and accuracy, I stress to Mr Balfour that the emergency budget review will consider the issues around balancing of this financial year’s budgets. Budget statements will be made later in the year in the normal sequence of events and will be accompanied by the normal level of forecasting that Parliament would expect.

I consider all that information because, as a member of the Cabinet, I carry collective responsibility for the Government’s objectives. Therefore, the success of the Government’s programmes, in whatever area of policy they happen to be, matters to me, so I want to ensure that we can be successful. I was heavily involved in the formulation of the child poverty delivery plan, for example, and such issues are material to me in the conduct of policy. However, I come up against hard financial choices. I understand the concerns that people will have about the scale of increase not being as great as we would like, but in a difficult context, I think that this is a rational policy choice, because we have available capacity within existing programmes to support our endeavour.

However, we may not be able to put as much resource into this as we would like to, given the financial pressures that we face, and that is the dilemma that I am trying to square. Ultimately, I have a legal duty to balance the budget, but there has been an increase in financial pressure that has come from a number of places. One is the erosion of the value of our budget because inflation is more than double what was predicted, which undermines the value of our budget to the tune of £1.7 billion. There is also a necessity to resolve public sector pay claims, which are coming in at a much higher rate than was anticipated in the budget. I have to find resources to balance all that, and, in that context, we have to make considered policy choices. Those choices might be difficult and have wider ramifications, but I am trying to make choices that protect the programmes that enable us to pursue the policy agenda to which we have committed ourselves. However, I will keep those issues under review.

Yes, because it is a demand-led budget, so whoever is entitled to it will get it. It is simply about making sure, given the degree of pressure that I am having to deal with within this financial year, that I do not allocate money into budget lines in which it is unlikely to be required when it is required in other budget lines.

In my letter to the Finance and Public Administration Committee, I have set out the specific changes that are being made. If further changes are to be made, I will do that transparently.

I have been completely open with the Parliament. There is no obligation on me to come to the Parliament in September with the statement that I made. I could have left it all to the autumn budget revision. However, I have a duty of candour to the Parliament. It should hear the issues and difficulties with which I am wrestling. Those should be set out to members. Any further changes of that nature will be set out in a similar fashion.

The judgment that I was making there was based on looking at the available data on the levels of usage of public transport in the current context. We fixed our budget—obviously, concessionary travel is a crucial social and economic benefit in our society—and made our best estimates of what we reckon will be the uptake of the concessionary travel scheme.

We looked at the data that is available to us through the financial year showing the degree to which people are returning to public transport in the aftermath of Covid—there is obviously a degree of nervousness or anxiety about using public transport—and made a judgment about where we think that demand will eventually settle.

Again, there is a degree of judgment involved here and, ultimately, if we find that the budget line exceeds what I have predicted in the latest update, we will have to meet that cost from other areas in the budget. However, I hope that the steps that we have taken will be appropriate and that the predictions about the budget will have the necessary accuracy.

I am aware that different approaches are taken in different parts of the country to what support is available to people—for example, the arrangement for my son’s national entitlement card was handled through the school and done very efficiently. It was a totally straightforward process and there was no difficulty whatsoever, and he is now using his national entitlement card with some gusto.

Given that the scheme has been open since only January, there have been high levels of uptake in a relatively short space of time. We are promoting awareness of the national entitlement card among young people, and we encourage them to take it up. We make necessary judgments about the volume of usage, which allows me to make the judgment that I have made about the size of the budget.

The £82 million is a product of decisions that were taken by the United Kingdom Government, which gave rise to a consequential. As members know, those consequentials come into our budget but they do not come in with a badge on them; they come in as consequentials and we decide their allocation. Obviously, a range of measures to assist with the cost of living challenges are provided in Scotland that are not provided in other parts of the United Kingdom, and we have allocated resources for those measures. The £82 million had been allocated into the Scottish Government’s budget to help us meet the various elements of expenditure that we put in to support our programmes that assist with the cost of living and other matters.

I would pause before adding the two numbers together, Mr McLennan, if you will forgive me. The point that I am making is that, whatever we say about the erosion of value, £700 million in hard money, which we did not anticipate at the start of the financial year, has to be found in the budget, which has to balance by the end of the year. That is the challenge with which I am trying to wrestle.

I will come on to that. Looking at the comparative example from the Republic of Ireland, dramatically different decisions are being taken by an independent country that is in close proximity to us and has made different constitutional choices. There is an important lesson for us in that comparison.

I am very happy to engage with all groups as much as I can on the issues. I listen to people’s perspectives, and I think that I have a track record of listening to different views. When I was finance minister, I enjoyed my interaction with the Women’s Budget Group; I have huge respect for its work and have valued it enormously. However, I have to make this point to the committee bluntly: if people are going to complain about the choices that I have made, they have to give me alternatives.

When I look at the way in which Government engages, there is extensive engagement with organisations in the formulation of our plans. At a personal level, I am involved in some of those discussions, but my colleagues—principally, the Cabinet Secretary for Social Justice, Housing and Local Government, as well as the Minister for Just Transition, Employment and Fair Work—take forward a range of discussions with organisations that have an interest in the sphere of employability.

Generally, the Government has every opportunity to hear and understand the perspectives of different organisations in that respect. Obviously, we will continue that dialogue. I will be talking to a range of interested parties as I finalise issues around the emergency budget review. We have had a number of submissions from organisations about what resources should be available to assist with cost of living challenges and where they would be best deployed. The committee will be familiar with the range of propositions that have come forward from organisations, and we will certainly undertake further dialogue on that.

In response to the questions about equality impact assessments, those are carried out in relation to budget statements and programmes and we will continue to do exactly that.