Contingencies Fund (No. 2) Bill

Published date : 11 March, 2021
This is a short but important Bill. Last year’s measures in the Contingencies Fund Act 2020 were absolutely unprecedented. Setting a level of 50% on the fund ensured that the rapidly evolving policy response to covid-19 could be matched with the necessary resource. It was important that we did so. At that time, we were heading for a lockdown and a parliamentary recess for Easter. It was unclear when Parliament would be able to return and we had no means at that point, at least as I recall, of enabling virtual participation in Westminster, so it was essential to allow necessary and perhaps even extraordinary expenditure to take place in the short to medium term to support the policy responses to covid that were deemed to be necessary, without the requirement for us to reconvene Parliament to ensure that further spending could be authorised.

This year’s Bill, by extending the scale of the fund beyond the usual 2%, clearly recognises a need for that flexibility to continue. Setting this year’s contingencies fund at 12% may well give access in the short term to the same amount of resource that was used in practice last year. In the light of experience, it may be felt that out of all the arbitrary figures that could have been chosen for the Bill this year, this is the figure that somehow just feels right. However, for all the progress that has been made with vaccines and vaccinations in recent times, we are not out of the woods yet. There have been mutations to the virus, which have increased its virulence and forced us in consequence to change our behaviours and responses. There may yet be further mutations that force us to further reappraise our plans on how we wish to emerge from the present restrictions.

The only thing that we can predict with certainty about the future of living under this virus is that we cannot predict it with certainty. As such, while the Scottish National party group supports the Bill and will not oppose the 12% level being set on the fund, I will place on the record that we would have been content, in the interests of prudence and good governance, to see a higher figure being used.

Let me turn to the proposed amendment; I am aware of your injunctions about time, Mr Deputy Speaker, and that the Bill will have a Committee stage. I have looked at the amendment, which has been tabled in the name of the Leader of the Opposition and the shadow Chancellor, and although it increases the length of the Bill tenfold, it clearly seeks to tackle important issues regarding transparency and accountability in Government spending. I have a lot of sympathy with its intent and will listen carefully to the arguments in Committee.

There is, however, a much wider issue regarding the ability of this House to properly scrutinise Government expenditure, which extends to the estimates process. For someone who entered the House with a background in local government and who bore the scars of passing budgets as a co-leader of a minority council administration, it is remarkable, in contrast, how contested local authority budgets running to just hundreds of millions of pounds can be, when hundreds of billions of pounds across the year in central Government expenditure can still sail through relatively untroubled by the interference of competing views from the Opposition. Although there have been some recent changes to the estimates days’ debates—the estimates can now be debated rather than needing the vehicle of Select Committee reports related to them—it is still extraordinary to my mind that there is no meaningful way to seek to amend Government spending through the estimates process or an ability, as a matter of course, to scrutinise planned departmental expenditure before it is approved.

That brings me, in closing, to the current fiscal framework. The Scottish Cabinet Secretary for Finance has repeatedly pressed the UK Government to provide extra flexibility so that the Scottish Government can mobilise funding when it is most urgently needed through this crisis. While the UK Government have indeed confirmed that the late funding allocated in this financial year could be carried forward into 2021-22 without having to use the Scotland reserve, that flexibility is still limited and temporary. The crisis has revealed a fiscal framework in the UK that is not fit for purpose. As the previous furlough extension for England demonstrated, no matter what the devolved Governments might wish to do in policy terms, problems still have often to be felt first in Whitehall before a budgetary response is triggered for England, which then triggers its way through to other Governments.

In my view, the best people to take decisions for Scotland are those of us who make our lives here. The policy choices we make should be restricted only by the limits of our own resources, the limits of our own choices and the limits of our own imaginations, and not by limits and constraints that are set elsewhere. We will continue to press for these additional flexibilities as part of the fiscal framework review.

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