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Do we have too many NHS boards in Scotland?

That is the point, though. You talked about the two areas where you can get additional money. The first is via the block grant, which presumably is either money that has been pre-promised from the UK Government through top-up funding from the UK budget or Barnett consequentials due to decisions that have been made in Westminster, or block grant asks of the UK Government, which are not guaranteed to be met—the two are very different. Alongside that sit revenue projections from tax intake under devolved taxation. What happens if neither of those increases or if there is no likelihood of them increasing? For example, early projections show that the tax increases announced in yesterday’s statement are less than £100 million, so it is nominal and nowhere near enough to scratch the surface of the spending commitments—the cash spend commitments. Surely the only other option would be for portfolio increases that happen in one area to require cuts in other areas. In other words, to balance the books, the money is just shuffled around from one set of portfolios to another. Either you have new money or you are just shuffling around existing money. It is very hard to determine which it is, and I guess that that is what I am struggling with.

You said in your last answer that the report highlights that social security spending will be £1.5 billion more due to devolved spending decisions, which again are policy decisions for policy makers. I understand that, and I am not asking for comment on the policy itself, but the facts are that they are spending more than they are getting in that portfolio. Presumably, that is unsustainable—the money must come from somewhere.

Just before I bring in Richard Robinson, I have to wonder whether we have a problem here. All the news headlines last night were about this particular policy, which I will not comment on the specifics of; however, despite all the focus on that policy announcement, we have since discovered that we do not know how much it will cost, if it is passed as part of the final budget and implemented. In fact, there is some dispute over those costs.

How can ministers stand up in Parliament or go on TV and say, “We are introducing this policy but no one has a clue how much it costs”? Any estimates that there might be—and we have heard from one independent source that it might cost £200 million to £300 million per annum—have not been fed into the budget process and therefore not been factored into the wider budget assumptions. What if you were to do that with every policy and just announced what you like? Having nothing in the small print that says, “This is how we came to that number. This is how much we as a Government know it will cost the public purse” does not feel like a sustainable way of running a budget in the long term.

Are you surprised—or, indeed, disappointed—that we do not have medium-term financial strategies from our Government? It seems to me that producing this kind of high-level strategy is a really basic aspect of the governance of public finances, but year after year, we hear these criticisms that it does not exist.

Just to throw a spanner in the works, some of the early analysis of yesterday’s announcement paints a bigger picture around how we get our heads around the transparency issue when ministers make announcements about new money. I was particularly struck by the summary from the Institute for Fiscal Studies. I am not sure whether you have read that yet, but it left me with more questions than answers. To summarise it briefly for the benefit of others, it paints a picture of announcements that are made on paper—by the way, this is backed up by the SPICe graphics that came out this morning—suggesting around a 5 per cent cash-terms increase or 2.9 per cent after inflation, so a real-terms increase. However, and this is key, it excludes £1.3 billion of funding that the budget documentation implies the Scottish Government still has to allocate to services this year. If that was to be taken into account, you are looking at a flat-cash settlement next year.

Where do I start with this? There is either a 5 per cent cash increase or there is not. I am of the understanding that the Government is unable to roll over money year on year, so how can unallocated money from this year be spent in next year’s budget, for example? Again, that all just raises questions about the veracity of some of the top-line figures that people are seeing in the newspapers this morning, which is why I think that it is important to dig under those figures. Do you have any view on that?

You talked a little bit about the budgets for the NHS, social care and social security. We all know the direction of travel for those budgets—they are becoming an ever-increasing chunk of expenditure for the Government. Presumably, any announcement—whatever the numbers are or whether they are increases of 1, 3 or 5 per cent—will either cannibalise the wider Scottish budget and the total pie available, or is reliant on some additional cash, the value of which is unknown, although we know roughly the value of the spending commitments. You talk about balancing the books. That may be the case, but big spending announcements are being made where there is no clear, backed-up and identifiable source for how those will be funded. Are we able to follow the money, or is there still a lack of transparency and clarity?

Thank you.

Finally, do you have the feeling or the impression that the Scottish Government is, year on year, firefighting in the way that it makes in-year changes to the budget? By that, I mean emergency measures that move money from one budget to another. Over the past two years, money has been pumped into pay awards, pensions, social security and health and social care at the expense of agriculture, energy, housing, ferry services and education. Money is getting sucked out of other portfolios in the middle of the year to plug gaps as a result of policy decisions and spending commitments that must be fulfilled not just annually but, as you have rightly said, over the medium term.

To me, that feels like a very short-term way of managing your budget year on year. It is a bit like getting up in the morning and deciding how much you will spend that day, instead of looking towards the rest of the week or month. Again, does that indicate a picture of stability or good governance of public money?

Good morning, Auditor General. I am very surprised that you were not up all night studying the budget like everyone else was.

Yes, a draft budget was announced yesterday, but I want to look at the context, given your report and some of the wider issues around financial sustainability of public spending relative to revenue that you have been talking about for the past few months. I will reflect on some of what happened yesterday, but in that context, rather than in relation to the specifics of policy. I hope that that is helpful.

Over the 24 hours since the budget announcement, I have struggled to dig below the headlines. You will see a lot of media reporting around cash spend increases and promises to spend more in specific portfolios, but where that money is coming from is particularly unclear. That transparency issue is something that you raise in your report. How do we, as a committee and as parliamentarians, and the public get to the detail? How do we know where the additional money is coming from? I do not know where it is coming from.