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I understand that there is some politics there, but I think that the flexibility issue is one that will not go away. I would hope that the Verity house agreement will allow greater flexibility to enable better service provision, with the resources that we have.

However, the Scottish Government can make savings in other areas. One thing that I have always been surprised about is that people can go to their general practitioner and get paracetamol. I asked a question about that and found that the cost of paracetamol that was prescribed in Scotland in 2022-23 was nearly £12 million, and that the average cost to see a doctor is £56, apparently. Other products such as Calpol and ibuprofen are also being prescribed. Surely we could save tens of millions of pounds from the medicines budget if things that are readily available in local pharmacies and, indeed, in supermarkets were no longer on the list of medicines that can be prescribed.

Research universities are concerned that the golden triangle of London, Oxford and Cambridge sucks in a lot of venture capital. That is why I have raised issues such as proof of concept money in the chamber. We were told that £5 million of Scottish Government money would bring in some £200 million of private investment, but some predictions, such as those about the data-driven innovation initiative, have underestimated how much we could bring in.

The main issue is that we have the potential to take Scotland forward but we are falling behind the rest of the UK. Employment in high-tech areas will provide tax revenue for the Scottish Government to invest in anti-poverty initiatives and other measures, which would be a win-win all round. I am asking about where to invest limited resources to get the best return.

That is helpful—thank you.

There is loads of other stuff that I could ask about, but colleagues are keen to jump in, so I will ask just one more question, which is about progressive taxation. The UK does not have progressive taxation—it takes a steps and stairs approach, which Scotland is tied into because we have limited room for manoeuvre.

Colleagues and I have raised every year the fact that marginal tax rates in Scotland are higher on incomes of just over £43,000 than they are on incomes of £50,000-odd, because of higher rates of national insurance, which we do not control. Given the difficulties of that system, what work is the Scottish Government doing to try to make that progressive, so that the share of income that a person pays in taxes rises as their income rises? As I have said, that is not the situation at the moment, when someone who is earning £55,000 a year can actually pay less tax than someone who is earning £45,000 a year. What is the Scottish Government doing about that?

What further research is being done on behaviour? The behavioural response to taxation was trailed last year, and there is a big debate about the impact of increased taxation, not because of the mistaken idea that people might flee Scotland but because they might choose to work less or might use incorporation or other ways of avoiding paying income tax.

Obviously, we can look at what is happening in other countries, such as Estonia, which, incidentally, has a straight 20 per cent tax across the board. I do not think that we in Scotland will be in that position any time soon, but having six tax bands does not help—having rates of 19, 20 and 21 per cent just seems daft to most people. I understand why that was brought in, but it is a nonsense, is it not?

I thank the cabinet secretary and her officials very much for appearing today.

That concludes our evidence taking on managing Scotland’s public finances, a strategic approach. We will consider all the evidence received as part of our inquiry and publish our report in early November.

We will now have a short break to allow for a changeover of witnesses before we move on to our next agenda item.

Because time is against us, and you have another meeting to go to, I will not revisit capital or talk about public sector reform or digitalisation, all of which I had hoped to cover.

However, Jamie Halcro Johnston has provoked me to ask a final question on another issue: the mitigation of UK Westminster welfare cuts. For example, the Scottish Government is currently paying £133.7 million to mitigate welfare cuts, with the imposition of the bedroom tax being the most obvious example in that respect. However, it has decided that it will not continue down the road of funding the winter fuel payment, because that £160 million would have to be found from the national health service, local government, justice and other budgets. Has the Scottish Government taken a decision that it will no longer mitigate any reductions in Westminster spend, or will it continue to look at that on a case-by-case basis? Obviously, that £133.7 million that we are using to mitigate things is also £133.7 million that is not going into devolved areas of spend.

I am not saying that it should be about new things. I think that people are saying that they are concerned that the Scottish Government is paying lip service to the national performance framework, that it is not embedded in what the Government does and that it is not clear, for example, how Government spending or, indeed, priorities align with it.

The fact that the consultation was not all singing and all dancing, as many of the witnesses said that it should have been, and that it was fairly limited in scope made witnesses think that the Scottish Government is not serious about it—it is almost a tick-box exercise. That is a major criticism of where we are at this time.

There was an expression of disappointment among many people who are committed to the national performance framework that they feel that the Government is not as committed as perhaps some of our stakeholders are.

You talked about the importance of the national performance framework with regard to finance, but it is not seen as explicitly or transparently driving financial decisions by Government, nor is it seen as holding organisations to account for spending funding effectively.

I find it difficult to comprehend how, as a sub-state legislature, we could eradicate child poverty or poverty in general with the powers that we have, which are limited—let us be honest about it—and could be changed at a moment’s notice by the UK Government. How realistic are those ambitions in the national performance framework?

Hello. Earth calling Keith.