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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 4 May 2021
  6. Current session: 13 May 2021 to 2 September 2025
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Displaying 3539 contributions

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Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Yes. It will be interesting to see what is included in the £28 billion and whether that will be linked to inflation. The figure was £28 billion when the policy was announced. Will that money be worth the same in real terms in year 5? What pace will things progress at?

Thank you very much for your evidence today, gentlemen. As always, it has been really helpful.

12:18 Meeting continued in private until 12:30.  

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

We will be taking evidence from the SFC next week. Is it your view that there are likely to be tens or hundreds of millions of pounds of additional expenditure in the years ahead?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

I am thinking about the impact on capital. Capital inflation is running higher than resource inflation, yet the GDP deflator is predicted to grow by only 5.5 per cent over four years. That seems to be nonsense. Anyone who wants to get a house built or a road patched and goes out to tender will not be quoted a 5.5 per cent increase over the next four years, will they? Surely there should be a much more realistic look at how inflation is impacting on capital in particular.

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

I am thinking about looking in the round and looking not at individual projects but at capital procurement, which is a huge aspect of UK public spending relative to the same projects on the continent.

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Does Mr Hughes or Professor Miles have any final comments? Are there are any areas that you feel we have not touched on that you want to emphasise?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

We move on to the second part of our evidence session on the UK autumn budget statement and the wider UK context. We are joined remotely by Carl Emmerson, deputy director, and David Phillips, associate director and head of devolved and local government finance at the Institute for Fiscal Studies. Good morning, and I welcome you both to the meeting. I am glad to see that you are sitting together; that should make life a wee bit easier.

I will start where we left off. I quoted Paul Johnson’s response to the autumn statement to witnesses from the OBR, who gave evidence just a few moments ago. Professor Miles said that he thought that the IFS was being “somewhat pessimistic” in its outlook. What is your view on that?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Interestingly, the UK population has been growing very consistently over the past three years by about a third of 1 per cent a year. When it looks at growth for the UK economy, does the OBR also look separately at per capita income growth, or does it simply look at the economy globally? You are talking about 1.6 per cent growth in the UK economy but, if you take population into account, it is probably about 1.2 or 1.3 per cent. Do you look at that?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Good morning, and welcome to the 33rd meeting in 2023 of the Finance and Public Administration Committee. We have apologies from Jamie Halcro Johnston, who is unwell, and from Ross Greer, who will be late. Michael Marra joins us remotely.

The first item on our agenda is an evidence session with the Office for Budget Responsibility on the United Kingdom autumn budget statement and the wider UK context, with a view to informing our scrutiny of the upcoming 2024-25 Scottish budget. I welcome to the meeting our witnesses from the Office for Budget Responsibility: Richard Hughes is chair of the budget responsibility committee; Tom Josephs is a member of the budget responsibility committee; and Professor David Miles, who joins us remotely, is a member of the budget responsibility committee. I understand that questions should be put to Richard Hughes and that he will bring in Professor Miles if he needs to do so.

We will move directly to questions from me; I will then bring in other members of the committee.

It appears that, in September, the Chancellor of the Exchequer was in—let us say—deep trouble with the fiscal situation, but by November, he had some significant wriggle room, thanks to OBR predictions of higher inflation and fiscal drag. I understand that that amounts to around £14 billion since March alone. Can you talk us through how the OBR forecasts have changed over the months since March?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

I am glad that you look at it in defence procurement, because the costs for the Ajax project or for certain aircraft carriers have been billions of pounds higher than initially estimated. Of course, that was the case with HS2 as well. All those major projects seem to be hugely over budget.

Incidentally, does the OBR ever look at the price of procurement in the UK relative to other parts of Europe? All capital projects seem to be phenomenally more expensive in the UK than they are in Europe, for example.

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Overseas students still put billions into the economy, even if they do not work. What is the contribution to the UK economy of the overseas student population? There are thousands and thousands here in Edinburgh, and in Glasgow, Manchester, London and elsewhere. What is their net contribution to the economy?