3rd Report, 2008 (Session 3)

Annual Report 2007-08

Remit and membership

Remit:

1. The remit of the Finance Committee is to consider and report on-

(a) any report or other document laid before the Parliament by members of the Scottish Executive containing proposals for, or budgets of, public expenditure or proposals for the making of a tax-varying resolution, taking into account any report or recommendations concerning such documents made to them by any other committee with power to consider such documents or any part of them;

(b) any report made by a committee setting out proposals concerning public expenditure;

(c) Budget Bills; and

(d) any other matter relating to or affecting the expenditure of the Scottish Administration or other expenditure payable out of the Scottish Consolidated Fund.

2. The Committee may also consider and, where it sees fit, report to the Parliament on the timetable for the Stages of Budget Bills and on the handling of financial business.

3. In these Rules, "public expenditure" means expenditure of the Scottish Administration, other expenditure payable out of the Scottish Consolidated Fund and any other expenditure met out of taxes, charges and other public revenue.

(Standing Orders of the Scottish Parliament, Rule 6.6)

Membership:

Derek Brownlee
Joe Fitzpatrick
James Kelly
Liam McArthur
Tom McCabe
Elaine Murray (Deputy Convener)
Alex Neil
Andrew Welsh (Convener)

Committee Clerking Team:

Clerk to the Committee
Susan Duffy

Senior Assistant Clerk
Mark Brough

Assistant Clerk
Allan Campbell

Committee Assistant
Katie Packer

Annual Report 2007-08

The Committee reports to the Parliament as follows—

Introduction

1. The Committee has had a busy work programme in the first year of the new parliamentary session. The Committee’s main area of work is the annual budget process.  In addition to its budget scrutiny, the Committee has considered seven financial memoranda and has begun taking evidence on a major inquiry into the methods of funding of capital investment projects.  The Committee has also launched a review of the budget process, and will begin a programme of evidence in the forthcoming parliamentary year.

Inquiries and Reports

Budget Process 2008-09
2. The principal role of the Finance Committee is to lead the Parliament’s response to the Scottish Government’s spending proposals through the annual budget process.  Although the process this year was particularly time-pressured, the Committee protected time for parliamentary scrutiny by agreeing a revised timetable with the Scottish Government.

3. As well as examining the overall budget, the Committee decided to focus its scrutiny on the impact of the budget on local government and on sustainability, holding an evidence session on 11 December 2007 with representatives of COSLA and experts on sustainability.  In order to gauge local views on the budget, the Committee held an external meeting at Discovery Point in Dundee on 10 December 2007.

4. The Committee’s report was published on 16 January 2008.  Alongside a series of recommendations on the provision of budgetary information, the Committee recommended that the Scottish Government examine ways to increase police numbers and, by division, to accelerate proposed cuts in business rates.  The proposals were accepted by the Scottish Government, and amendments to the Budget Bill were subsequently agreed by the Parliament.

Inquiry into the methods of funding capital investment projects
5. The Committee launched an inquiry into the methods of funding capital investment projects in 2007 and, after gathering substantial written evidence, it is currently taking oral evidence from a wide variety of organisations and individuals.

Review of the Budget Process
6. The Committee launched a review of the annual budget process in March 2008 and published a detailed consultation paper.  The Committee will begin taking evidence in June.

One-off evidence sessions
7. The Committee agreed to continue the work of the previous Finance Committee in monitoring specific Scottish Government initiatives, and has held a number of one-off evidence sessions on issues such as the relocation of public sector jobs, the Independent Review of Scrutiny (“the Crerar Review”), and the Report of the Budget Review Group (“the Howat Report”).

Bills

The Committee has adopted its predecessor Committee’s three level system for scrutinising Financial Memoranda of Bills. Level 1 involves sending a standard questionnaire to affected bodies. Level 2 involves taking written evidence from affected bodies and oral evidence from the Scottish Government. Level 3 involves the same steps as level 2, plus oral evidence from affected bodies.  This year, three Financial Memoranda have been scrutinised at level 1, two at level 2, and two at level 3, which has resulted in four reports to lead committees at Stage 1

Subordinate Legislation

8. The Committee has considered and reported on two affirmative and two negative Scottish Statutory Instruments.

Innovations

9. As part of its 2008-09 budget scrutiny the Committee held an external meeting in Dundee. Prior to the meeting the Committee held workshops with selected representatives from businesses and organisations from within the local community. Participants were chosen to represent a wide range of views, including a number of contributors from environmental groups.  Issues arising from these workshops were then raised with the Cabinet Secretary for Finance and Sustainable Growth during a formal evidence session.

10. Members of the Committee also met with students from local schools in Dundee for a series of informal question and answer sessions.  Students were also given the opportunity to attend the Committee’s evidence session with the Cabinet Secretary.

Equalities

11. In its preparatory work for the external meeting the Committee sought to ensure that the venue was accessible to disabled people and had good transport links with the local area to allow the highest possible participation.

12. The Committee’s budget adviser has also met with members of a working group investigating ways to equality-proof the annual budget.  In addition, the Committee made a number of recommendations in its report on the 2008-09 Draft Budget on how equalities information could be improved.

Meetings

13. During the parliamentary year (from 9 May 2007 to 8 May 2008), the Committee met 25 times. Of these, 10 were held entirely in public, 13 were held partly in private and two were held totally in private. The purpose of the majority of private items was to consider Committee reports.

14. All Committee meetings were held in Edinburgh, with the exception of its meeting in Dundee on 10 December 2007.