Scottish Parliament, 17 April 2008

437 contributions from 89 members. The official report.

Official Report 17 April 2008

Local Income Tax

Alex Fergusson (None, Galloway and Upper Nithsdale)

Good morning. The first item of business is a Labour Party debate on motion S3M-1715, in the name of Andy Kerr, on local income tax. I invite all members who wish to speak in the debate to press their request-to-speak buttons now. I advise all members that time is extremely tight and I will have to be pretty ruthless.

Andy Kerr (Labour, East Kilbride)

As we are learning, the nat tax proposals can now be added to the list of broken promises and ill-thought-through manifesto commitments that the nationalists made. We have a long list of ditched promises to students, primary school pupils, and first-time buyers. We have the mess that is the Scottish futures trust. We have cut-back and cut-down promises on nursery provision, renewable energy, free school meals and the rest. We have cuts all over Scotland's local authorities to bus services, education maintenance allowances, enterprise, energy and tourism, and the rest.

We have waited for a long time for the nationalists' tax proposals to be presented to Parliament and the people. We know that the consultation document lacks the most basic figures. It is getting a worse reception than Thatcher's poll tax did when it was first published. Just yesterday, the Edinburgh Evening News said that the local income tax

"is just as big a political time bomb as poll tax".

It will be Mr Salmond's poll tax.

Many commentators and others have spoken on this matter. Iain McMillan of the Confederation of British Industry Scotland said:

"replacing the council tax with a local income tax is the wrong policy response"

and

"If Alex Salmond and his colleagues have any sense they will dump this policy forthwith".

In 2006, Mr Swinney said:

"Our conclusion is that there is no point in replacing one bad system with another".—[Official Report, 1 February 2006; c 22902.]

He is absolutely right, so I expect him to dump his nat tax proposals.

The great contradiction at the heart of the proposal is that it is not a local income tax. There is nothing local about it. Overnight, it would remove one of the key principles of local government: its right to determine how much revenue it raises locally. How would that show the new respect and understanding that we hear so much about?

The Scottish National Party proposals fail the test of accountability. A nationally set tax would mean that the Scottish Government would determine how much councils can spend, thereby removing fiscal autonomy and responsibility from local government. It is, as we know, centralisation by stealth. Autonomy is crucial because without it councils could not have resisted the tax-cutting agenda of the Thatcher years. Now we have a tartan Tory budget in Scotland. A minority Administration with a tax-cutting agenda is squeezing council budgets and causing cuts in services across Scotland. The nat tax will allow the SNP to continue that agenda, preventing councils from responding to local needs and priorities.

The Liberal Democrats should be extremely wary of any suggestion that the SNP would revert to a local tax in future years, given the broken promises in its manifesto.

Another myth around the so-called local income tax—which it is not—is that the rate would be 3 pence in the pound. We all know that it would be 5 pence at least. The Cabinet Secretary for Finance and Sustainable Growth is plain wrong to assert that a 3p rate of local income tax would provide the resources to replace the council tax. We cannot find one independent commentator who thinks that a 3p rate would be sufficient to raise the same amount of funds as the council tax raises. A 3p rate would provide only 60 per cent of those resources, leaving an £800 million black hole. Whichever way we look at it, the rate would be 5p not 3p, and that puts a totally different complexion on the SNP proposals. That would mean a 25 per cent increase in the standard rate of tax. Modelling by PricewaterhouseCoopers shows that a 5p rate would mean that a single person living in an average house and earning £22,375 would be a loser, as would a couple on a joint income of £33,450.

John Swinney (Scottish National Party, North Tayside)

Before Mr Kerr leaves the point about the financing of local authority services, will he confirm whether the Labour Party in Scotland believes that the Parliament is able to change the system of local taxation and include in that calculation the resources that we currently receive in council tax benefit?

Andy Kerr (Labour, East Kilbride)

I will come to council tax benefit in a minute.

Three-fifths of Scottish households have more than one earning adult, and they will be very badly off under the nat tax. Far from being better off—the myth peddled by the SNP—many hard-working Scottish families would be worse off. The proposal is nothing less than a tax on jobs in Scotland. Unless local income tax bills are around 40 per cent higher than forecast, they will not close the shortfall in local government funding.

The local income tax will not be a fair tax. It can safely be concluded that the proportion of households that will be better off under the nat tax will be significantly lower than the 90 per cent figure conjured up by the SNP. Bills will have to be higher because 25 per cent of households currently receive full council tax benefit and they will be no better off under the nat tax proposals. Almost half of Scotland's pensioners already pay income tax and they would still be liable for that under the SNP's local income tax plans. There is no recognition of the impact that the plans will have on pensioners, on young workers living at home with their parents, or on single adults living together, such as nurses who are in training or students who are working their way through college. They will be badly hurt by the nat tax.

I will address Mr Swinney's point about council tax benefit. The SNP was warned before, during and after the election that the council tax benefit that is currently provided by Westminster would cease on the introduction of a local income tax. That is not bullying by Westminster; it is the view of respected academics and commentators alike. It is wrong to assume that the £381 million provided through council tax benefit to low-income households would be transferred to Scotland. That assumption reveals a limited understanding of the Treasury. The Burt report—not Westminster, the Labour Party, or anyone else—says that "Council Tax Benefit would cease" if a local income tax was introduced in Scotland. I suggest that Mr Swinney reads the Burt report more closely.

As we know, this is not a local income tax; it is a national tax. Families cannot afford it, businesses do not want it, local government does not like it, and, of course, the rich, who have accountants, will not pay it.

I move,

That the Parliament rejects the SNP proposals for a local income tax, noting that these proposals are neither local nor fair, that property has a role to play in our taxation system, that they would remove from local government any autonomy over raising resources locally and that they would fail to raise the resources required to fund much valued local services.

Patrick Harvie (Green, Glasgow)

There are two approaches that we could have taken to the debate and that we could take to future debates on this subject.

We could have taken the easy way and each party, once again, could have done nothing more than lay out its stall on local government taxation and knock down its opponents' arguments. The advocates of local income tax could have made the case for fairness and listened to nothing else. The SNP could have stuck to its 3p rate and the Liberal Democrats could have defended local variability to the hilt.

The opponents of the local income tax—more accurately called the salary tax—in its various guises could have listed all the shortcomings as we see them. The Conservatives could have restated the case for cutting the rate for pensioners. The Labour Party could have continued its attack on the administration or competence of the salary tax, or it could have raised more questions about the impact on average earners or the amount of revenue that it would generate.

The Greens could have made another speech about the merits of the land value tax, which the Burt review—that review that somehow started gathering dust before it was even shelved—recognised. Every time we make a speech about the LVT, a majority seems to come together somehow and the chamber agrees that the idea shows promise and that we should fully investigate it. It never happens. The previous Government never made good on that promise, and the current one manages a less than impressive eight lines on the issue in its consultation.

So, we could have had that easy debate. Each of us could have set out our policy and defended our positions. The Greens could have taken the easiest possible approach and simply voted for the Labour motion, which rejects a local income tax but says nothing—not one word—about what should be done instead. How much further would that have taken us? Not a single step. Why? It is simply because the Parliament remains deeply and almost precisely evenly divided on the issue. There is no majority for a local income tax in the chamber, but there is no majority for the status quo either. Each party's colours are nailed firmly to its own particular mast and little room is left for dialogue. We appear to be at an impasse.

That is why we chose a different approach to this debate. If we were to agree a motion today that closed the door either to reform or to any element of property tax, Parliament would still be facing the same impasse. We would not have moved forward in any way. It is far better to recognise our differences and agree some basis on which to resolve them. That is what my amendment does—it specifies the criteria that we should establish for a local taxation system. If it is agreed, all of us—regardless of which system we support—will need to answer for ourselves against the criteria.

That is not the easy debate; it is the harder debate. It will be hard for the advocates of the salary tax to demonstrate how they can reduce tax avoidance, especially given that people at the wealthiest end of the spectrum would get away with paying nothing under the proposals. They will also find it hard to explain the economic advantages of the abolition of any element of property tax. It is a measure that, all things being equal, would be inflationary and would further distort the housing market and make it even harder for people to buy their first property. They will find it hard to point to any environmental benefits of such a tax, as it gives local authorities no facility to incentivise the efficient use of land. In case that seems to imply that LVT would get an easy ride, I am prepared to admit that we also have a hard job to persuade others that land value tax or site value rating can be made to ensure fairness for everybody. I know that there are questions about the detail that we have not yet answered and that we will need to work hard to answer them.

Margo MacDonald (Independent, Lothians)

Some of us believe that local income tax as proposed by the Scottish Government is impossible to bolt on to a comprehensive, cohesive system of taxation set in Westminster. Will the same apply to land value tax, or is there a way round the problem?

Patrick Harvie (Green, Glasgow)

If land value tax is introduced gradually it can be compatible with existing taxation systems, even in a devolved settlement, but we will need to put flesh on the bones of that proposal. I accept that that is a hard thing for us to do. My point is that we should all be prepared to have the harder debate on our own policy rather than just battle against each other.

The other parties that oppose the salary tax will also have difficult questions to answer. Those who have until now opposed fundamental reform will need to answer the fairness question. How can we address the strong, perhaps even overwhelming, public feeling against council tax and build greater fairness into the system? In Andy Kerr's words, it would be wrong to replace one bad tax with another. If we accept that council tax is a bad system, we need to accept the need for reform. How can we achieve improvements in social and environmental impacts if we retain the existing system? Those are all questions to which we do not yet have the answers, but it is only by asking them and by taking part in that difficult debate that we can move beyond the impasse and respond to the public clamour for change.

The most important lesson that should be learned from today's debate is that those, like me, who believe in the principle of retaining a property element in local taxation but understand the need for change, must have something more constructive to offer than the status quo. The status quo is unfair, unpopular and, after today, if my amendment is agreed to, it cannot be regarded as sustainable. After agreeing that, we can only move forward, rather than endlessly lock horns in a familiar, easy and futile confrontation.

I move amendment S3M-1715.1, to leave out from "rejects" to end and insert:

"notes the Scottish Government's consultation on the future of local taxation; recognises that this consultation is not due to close until 18 July 2008; notes the wider range of possible options, including local income tax, land value tax, property tax and reform of the council tax; recognises that the existing system of local government taxation is discredited, bureaucratic and unpopular; agrees on the urgent need for substantial changes to the system of local taxation, and agrees that, in developing this future system, due consideration should be given to fairness, local accountability, the need to reduce tax avoidance and the wider social, economic and environmental impact of any proposed system of local tax reform on communities across Scotland."

John Swinney (Scottish National Party, North Tayside)

This Government is committed to abolishing the unfair council tax and introducing a fairer local tax, based on the ability to pay, as part of our agenda to create a more successful country, with opportunities for all of Scotland to flourish.

Council tax is unfair and regressive. It hits people on low incomes, particularly pensioners, who can least afford to pay it. Our proposals for local income tax will make most single pensioners, most pensioner couples, most couples—with or without children—most one parent families, most single people and most households with multiple taxpayers better off. Only the top income decile will pay more under our proposals.

Last June, this Parliament agreed

"that local income tax, which is based on ability to pay, is a fairer system of local taxation than the discredited and unfair council tax".

Parliament went on to note

"the position of the Green Party in regard to land value taxation."

Just over a month ago, the Government published a consultation paper that sets out our proposals for change. The consultation period runs until 18 July. Now, just over a month into that consultation, we are debating a motion that seeks to bring the debate to an end and keep the hated council tax in this country. Given that this Parliament gave us the authority to develop our proposals, it would be an insult to the people of Scotland not to give this Government the opportunity to discuss its proposals with those people.

Gavin Brown (Conservative, Lothians)

On the subject of authority, the Scotland Act 1998 refers to

"Local taxes to fund local authority expenditure."

I accept that the local income tax would fund local authority expenditure, but, on the first part of the phrase, in what way is it a local tax?

John Swinney (Scottish National Party, North Tayside)

The proposals that the Government brings forward will be for local taxation to support local public services, which is exactly what the Government is entitled and able to bring forward. I will address the point in more detail. In our proposals—

Charlie Gordon (Labour, Glasgow Cathcart)

Will Mr Swinney take an intervention?

John Swinney (Scottish National Party, North Tayside)

Let me address Mr Brown's point. In our consultation document, we make it clear that our proposals are to support local taxation and local services. The simple contrast must be with United Kingdom income tax. No matter how much they pay, if an individual lives in the UK that money flows into the coffers of the Treasury. Let us face it, many people who earn under £17,000 will now pay much more in tax thanks to that crowd in the Labour party and their mates in the Treasury. The money that every individual pays in local income tax will go directly to the local authority area in which they live to pay for services for people living in that area.

Charlie Gordon (Labour, Glasgow Cathcart)

There has not been an above-inflation increase in Glasgow's council tax for 10 years. For three of those years, it has been frozen. That is mainly down to councillors. Why are you proposing to abolish local democracy as well as to attack wage earners?

John Swinney (Scottish National Party, North Tayside)

This Government has given local authorities more ability and discretion to decide their own priorities, in stark contrast to the way in which the previous Government strangled local authorities for the best part of eight years.

I am delighted to debate the issues on local taxation. Our proposals are designed to tackle the fact that low-income households pay 5 per cent of their income on average in council tax, but higher earners pay only 2.5 per cent. That is unfair and it is no wonder that Labour and the Conservatives want to keep the council tax. We are determined to press on with the debate to give people in Scotland a choice, because for eight years we had an Administration that put off the reform of local taxation and was put out of office as a result. We will reform local taxation and we will take the debate forward with the people of Scotland.

Derek Brownlee (Conservative, South of Scotland)

We could criticise the Labour party for giving only half its debating time this morning to the local income tax debate, but even if we had all week to debate local income tax there would not be enough time to cover all the flaws in the Government's proposals.

In the five weeks since the Government published its consultation, every week has brought fresh problems to the fore. With 13 more weeks to go, we can only conclude that it will be unlucky for some. I do not know whether Mr Swinney is a superstitious man, but the omens are not good for local income tax.

If the problems were not previously obvious to the Government, surely they must have become so on the day that Nicol Stephen and Tavish Scott pitched up at St Andrew's house and offered to help. Mr Swinney need only look to his left, to the Labour party, to see where help from the Liberal Democrats gets someone.

The Government should cut its losses, abandon its hare-brained schemes and focus instead on reforming the council tax. Ministers will not have to do that today, thanks to Patrick Harvie's amendment. Today is unlikely to be the day of reckoning for local income tax, although it will come soon enough. There may be some quiet satisfaction on the Government benches if the Labour motion is rejected at decision time, but a defeat for the Labour motion this evening will not be a win for the Government. In fact, it might prove to be the reverse as it will allow the local income tax plans to limp on and continue to drag down and damage the Government. Today there is an opportunity to save the Government from itself. Local income tax is supposed to be its flagship policy, but it is a flagship that is not merely holed below the water line; it has sunk so far that it should be based at Faslane.

The local income tax plans are based on many dubious assumptions and assertions. It is claimed to be a local tax, but it is a national one. It is claimed to be a tax on income, but it is a tax on earnings. Of all the dubious assumptions, surely the most dubious are about the arithmetic—even the parliamentary arithmetic.

The Government has sensibly rejected the notion that every council in Scotland could set a different rate of local income tax. That would be a costly bureaucratic nightmare. It used to be SNP policy until Mr Mather had one prawn cocktail too many with those who would have had to administer it. Clearly, there were no prawn cocktails for Mr Scott because that is still Lib Dem policy. The Lib Dems have made their position clear—not a phrase I have ever had occasion to utter before. If local councils cannot set their own rate of local income tax, the Lib Dems will not support the policy. If the Conservatives and the Labour Party are opposed to the Government's proposals, the SNP's hopes lie with that most unlikely of outcomes: that the Lib Dems abandon their principles, go back on their word and do one thing, having said another. Who would have thought that the cabinet secretary would be so reckless as to gamble the Government on such a remote possibility?

Margo MacDonald (Independent, Lothians)

Much as I am thoroughly enjoying an excellent speech, I wonder whether the member agrees that outside these hallowed walls, people are much more concerned about whether they can pay their mortgage and the collapse of the international monetary system than fancy dancing on something that will never happen.

Derek Brownlee (Conservative, South of Scotland)

I certainly hope that it never happens.

There is some other arithmetic that has exercised the cabinet secretary. The Conservatives have published more figures on local income tax than the Government has. When the Government tried to rebut our figures, it said that the local income tax would lead to a £281 million tax cut. However, that is nothing to do with local income tax and everything to do with a decision by the Government to subsidise local income tax to a greater degree than it subsidises the council tax. If the money could be found to subsidise local income tax, why can it not be found to reduce the council tax? How much could council tax bills be cut if that additional funding was used to reduce them?

If we reject the motion, we can go on to consider council tax reform, but as long as local income tax is on the table that will not happen. We will happily work with the Government to reform and improve the council tax. That is an open and constructive offer, which will remain on the table and which I hope the Government takes up. In the meantime, for the first time in almost a year, I urge members to support the Labour motion.

Tavish Scott (Liberal Democrat, Shetland Islands)

Mr Brownlee was keen to talk about arithmetic. I recall that when the Conservatives were in Government, they recalculated unemployment at least 19 times. When it comes to arithmetic, Mr Brownlee's party certainly knows how to cook the books—it did it for 18 years and people were out of work because of the way in which it behaved. We will take few lectures from the sanctimonious Mr Brownlee on such matters.

Labour and the Tories are competing to be the voices of conservatism. Both are arch advocates of the council tax, despite their open acknowledgement that it gravely penalises Scottish pensioners. There is a consultation, which parties can use. We can let Parliament debate the issue when the Government introduces legislation. Through our Steel commission, the Liberal Democrats will work on a wider package of fiscal reforms. We take the point about the importance of local income tax fitting into a general basket of taxation, in terms of both the objective of growing the economy and the pressure on the incomes of Scotland's hard-pressed households.

The council tax is the ultimate in discredited, unfair, blunt instruments. Labour and the Conservatives—because they introduced it—argue for its retention.

Gavin Brown (Conservative, Lothians)

In the previous debate on local income tax, Mr Scott said:

"I give clear notice that the Scottish Liberal Democrats will work with the SNP Government on the issue."—[Official Report, 21 June 2007; c 971.]

How is that work going, Mr Scott?

Tavish Scott (Liberal Democrat, Shetland Islands)

It is interesting that Mr Brown disapproves of those who want to work to change the council tax. I want to work to get rid of the council tax and he does not, which is where he and I disagree.

Despite the rises in the cost of living in this country, Labour and the Conservatives argue for the retention of the council tax. The people in the lowest income tax bracket are being hit by changes in the budget, such as the withdrawal of the 10p minimum tax rate that was introduced by a previous Labour Government. Margo MacDonald referred to the international monetary system. Today, we hear that the Labour Government is to bail out the banks and expose taxpayers throughout the country to unprecedented levels of risk. That follows the utter shambles of Northern Rock. Labour cannot come here and lecture us and, more to the point, the country on taxation and on management of the economy. In China yesterday, our esteemed Chancellor said that Labour needed to sharpen up. At least Mr Darling is more in touch than the boss. There can be no greater indication of how much Labour in London is out of touch than its withholding what most Scots see as their money—that has given the SNP the easiest campaigning, anti-Labour argument. It is clear from last night's "Newsnight" that Labour needs rather more of Paul Murphy and a lot less of Des Browne and Yvette Cooper.

As Patrick Harvie pointed out, the Labour/Tory motion contains no proposals. There is nothing about the new council tax bands proposed by Labour during last year's election and nothing about revaluation, which also came up at the election. In Wales, where revaluation happened, millions face rises in local taxes that are not linked to the ability to pay. The Tories never seem to have any proposals, but what we remember of the most recent election is that they proposed cutting tax and rewarding the better off. That is not quite the on-message position of Mr George Osborne, who has had his Gordon Brown "Today" programme moment and committed the Tories to Labour spending levels and no tax cuts. Mr Brownlee's position is therefore even more right wing than that of George Osborne, which takes some doing.

Labour and the Tories are tied to what a recent survey of 30,000 internet financial users found to be the most hated tax—above inheritance tax, VAT and even fuel duty. The Scottish Government's proposals for a local income tax address some of the inequalities inherent in the current system. If the detail can be got right, 60 to 70 per cent of local tax payers throughout Scotland could be better off. However, the SNP's plans for a national tax undermine the autonomy of local councils. Our plans avoid the legal issues that appear to beset the SNP's position. There are differences between the Liberal Democrats and the SNP on local accountability—which we believe in—but we absolutely agree that no matter how the council tax is adjusted, it will always be unfair and it will always fail to reflect ability to pay. We will work constructively with the Government on the case for change and the detail of that change.

Frank McAveety (Labour, Glasgow Shettleston)

I am grateful for the opportunity to debate the local income tax. A few of us served in local government through some fairly turbulent periods—periods in which Derek Brownlee was probably in nursery school, if his counting is anything to go by.

There are various issues that I would like to discuss. First, in the debate about local government, a key point on which I think all members agree is the right of local councillors to determine their budgets in light of local circumstances and to have responsibility for how they raise revenue. One of the central problems with the local income tax is that it is not local and it removes that accountability. When I read about the council tax freeze and investment in council services, I recall the issue of parity of esteem, which was prevalent in debates prior to the election. Since the election, a horse and coach has been driven right through the principle of accountability, which many of us who have served in local government defended with great vigour, particularly during the Conservatives' centralising agenda in the 1980s and early 1990s.

Mr Swinney may dispute the point but, unfortunately, the Scottish Government is by stealth endangering the very autonomy of local government. That autonomy is meant to be one of the pillars of the new relationship and concordat—not to mention the parity of esteem—between the Scottish Government and local government. Those of us who have a background in local government and who have had discussions with our colleagues in local government should be wary of the commitment that the Government has made so far in the local income tax debate.

The second issue is much more fundamental. In the 1980s and 1990s, there was a debate not only about ensuring that we had enough resources to meet our statutory needs but about how we should address the new concerns emerging in communities throughout Scotland about issues such as pressure from population growth. In the case of Glasgow, an issue that Charlie Gordon and I had to confront was a diminishing income base and working population because of developments outside the city. Glasgow has an agenda for regeneration and the generation of income inside the city. The local income tax is a policy that could jeopardise much of the hard work that has been undertaken in Scotland's largest city.

There are major problems of accountability and fiscal prudence. I was a councillor and a council leader for a number of years, and I respect the fact that we expect councillors to make decisions locally. It is important that Mr Swinney gives them the opportunity to do that. The local income tax proposal, as it is currently constituted, does not present that opportunity.

My colleague Andy Kerr identified many other issues. My third point is that the Layfield committee, the Burt commission and—in relation to England and Wales—the Lyons report identified that if we are to have an effective local government system, we have to have the consent of local taxpayers to changes in taxation. The vast majority of those who will be making the most substantial contribution are working families. If there is a policy that penetrates their personal incomes to such a level that the noble aspiration to meet the needs of pensioners and the poor—

Patrick Harvie (Green, Glasgow)

Will the member take an intervention?

Frank McAveety (Labour, Glasgow Shettleston)

I am sorry, but I am in my final minute.

If you undermine that commitment, which was one of the clear problems with the poll tax, you imperil not only the accountability of local government but the effectiveness of the revenue-raising capacity.

Local income tax is an SNP manifesto commitment. You have had the bravery to ditch manifesto commitments when they have been inconvenient, but here is one that you may get consent to ditch because it imperils the legitimacy of local government and those who raise taxes locally. I urge members to recognise that that is part of the debate. There are broader debates on other issues, and I hope that the ministers will listen carefully to all the speeches.

Alex Fergusson (None, Galloway and Upper Nithsdale)

I remind all members that the only "you" they should refer to in this chamber is me.

Joe FitzPatrick (Scottish National Party, Dundee West)

I thank the Labour Party for its choice of debate. I would have thought that, in a month when 500,000 Scottish households have become worse off as a result of the scrapping of the 10p tax rate, Labour would be wary of debating taxation. However, rather than talking about how Labour's policies affect people throughout Scotland, we once again have a Labour debate on one of the SNP's flagship policies—a policy that is popular throughout the country, in stark contrast to Labour's hated council tax.

The idea of a local income tax is highly popular. In fact, the most recent academic research found that almost nine out of 10 Scots are in favour of replacing the council tax with a local income tax.

Frank McAveety (Labour, Glasgow Shettleston)

Does Joe FitzPatrick concede that Malcolm Rifkind also claimed that the poll tax was popular when he first introduced it in Scotland?

Joe FitzPatrick (Scottish National Party, Dundee West)

My claims are based on the most recent academic research by the University of Strathclyde; Mr Brownlee can defend Malcolm Rifkind's past actions. We all remember that the council tax was introduced by the same people who introduced the poll tax.

I am not sure how many of the 88 per cent of Scots who are in favour of scrapping council tax and moving to a fairer, income-based tax are in the Labour Party but, given that Jack McConnell and Gordon Brown have previously called for the introduction of such a tax, there may be more than we think. It is a shame that party politics prevents the progressive elements in the Labour Party from speaking out in favour of progressive taxation.

The reason why the local income tax is so popular is that, as well as being fundamentally fairer, it will leave the majority of Scottish households better off, as we heard from the cabinet secretary. We have heard Labour's made- up costs for LIT, which fail to take into account the SNP Government's commitment to deliver the biggest tax cut in a generation, and have read about the Tories' fantasy families. I will talk about some real-life scenarios in my constituency.

A single mother who lives in a band C rented house and works full time as a cleaner will be £35 a month better off when the council tax is replaced with a local income tax set at 3 per cent. That £35 assumes that she claims all the benefits to which she is entitled under the current system, even though we know that many people who are entitled to council tax benefit do not receive it in spite of campaigns by local authorities and anti-poverty groups.

We could also consider the police officer whose partner works for the council. They have a joint income of £40,000, live in a band D property and would pocket an LIT saving of £337 a year on what they pay under Dundee's council tax. That is after we have frozen the council tax—we can only speculate what the difference would be if we did not have an SNP Government.

Margo MacDonald (Independent, Lothians)

Does Joe FitzPatrick have any case studies of a family of two adults with two grown-up children who cannot afford to pay mortgages living at home? Will they look forward to paying four times what they pay now?

Joe FitzPatrick (Scottish National Party, Dundee West)

I thank Margo MacDonald for that point, because I came across such a family in Dundee. During the election campaign, I was quite surprised to come across one family who lived in a former council house and would pay more. They showed me that they would pay more, but they said that that was okay because their grannie and mother would pay less. The most vulnerable people in society will pay less, so they were happy to pay a tiny bit more. Other people in Dundee would pay a little bit more, myself included. However, that is the result of a fairer system. For example, I would pay an extra £55 a month as a result of a local income tax, but that is less than 1.5 per cent of my salary as an MSP, which is a small price to pay to remove the crippling chains of the council tax.

Peter Peacock (Labour, Highlands and Islands)

Before I came to this place, I spent 17 happy years as a councillor, many of them as chair of the finance committee of a big regional council. If I learned anything doing that job, I learned something about the essence of local government and local democracy. As Frank McAveety described, right at the heart of local democracy are local councillors assessing local needs, deciding on priorities and exercising discretion on how they meet those needs. That is principally enabled by their ability to levy a local tax and stand accountable at the ballot box for their decisions on that local tax, as I did when I was in that role for many years.

Scotland is littered with evidence of local discretion, local diversity and local choice in services and facilities. That is the essence of local government and local democracy but, at a stroke, the minority Government would eliminate all the local discretion that we have enjoyed for many decades. Not even Mrs Thatcher was prepared to contemplate that when she introduced the poll tax. At a stroke, a century or more of local discretion would be swept away. All local discretion would be removed and the often-articulated long-term ambition of local government in Scotland to raise a greater proportion of its income locally would be thwarted. In future, local government would not raise a greater proportion locally; it would not raise any local tax at all.

Ian McKee (Scottish National Party, Lothians)

Will Peter Peacock give way?

Peter Peacock (Labour, Highlands and Islands)

With respect, I will not, because I want to get on; I have only four minutes.

The irony is that the Government that is proposing to do that is also arguing for more tax powers for the Scottish Parliament. It is doing that at the same time as removing all local taxation powers and leaving Scottish local government with fewer tax powers than English parish councils enjoyed. What a joke it is for the Government to dress those proposals up as a local tax. There is nothing local about it. It is a new, extra Scottish national tax—a nat tax—and it will leave many worse off, unlike what Joe FitzPatrick said. That will be the case particularly in the region that I represent—the Highlands and Islands—and more widely throughout rural Scotland. Many households in Orkney, Shetland, the Western Isles, Moray, the Highlands and Argyll and Bute, where council tax levels have traditionally been lower than the Scottish average, will be worse off not only by a few pounds but by hundreds of pounds. Rural Scotland will be hit disproportionately, just as it was under the poll tax.

The proposed tax has many of the same features as the poll tax. It is ill considered and ill judged. It is costly to administer. It creates disincentives to pay and incentives to evade it, which is a huge issue for any taxation system. It adversely affects rural areas in particular and leaves the laird paying less than his keeper will pay. However, it adds problems that even the poll tax did not have. It removes all the local discretion that I have talked about. Its yield is inevitably unstable and unpredictable, unlike any form of property tax, and it raises big questions about redistribution between local government areas in Scotland. In the process, it reduces local government to agents of central Government.

It is also a deception to suggest that it is a 3p national income tax. An independent commission—it was set up by the previous Administration, but it was independent—said that it would be at least 5p. If the Government disagrees with Sir Peter Burt's conclusions and with all his expert advisers, it has an obligation to publish in detail the precise reasons why it believes that he got that calculation wrong. It will not, because he did not get it wrong.

The proposal is ill considered, expensive and ill judged. The Scottish National Party will rue the day that it introduces the Scottish national tax.

Jamie Hepburn (Scottish National Party, Central Scotland)

In the recent parliamentary recess, we learned that change is apparently what the Labour Party does. Nothing signifies the Labour Party's change as a force for social justice to its modern form more than its desire to defend the Tory-introduced council tax.

I will dwell briefly on the council tax that Labour wishes to defend, even if it cannot quite bring itself to mention it by name in the motion. That unfair tax hits people on low incomes the hardest, as it bears no relation to their ability to pay. We have heard much wailing and gnashing of teeth about vulnerable groups from the Labour members, but their continued support for the council tax betrays their shallow position. The council tax rose by 60 per cent under Labour's leadership during its time in government, and the most vulnerable and poorest people were the hardest hit.

The motion asks us to consider the merits of a local income tax, but the Parliament has already done so, on 21 June last year. Contrary to Patrick Harvie's assertion that there is not majority support in the Parliament for a local income tax, we agreed at that time that a local income tax that is based on the ability to pay is a fairer system of local taxation than the discredited and unfair council tax.

Patrick Harvie (Green, Glasgow)

I politely remind the member that the motion for the debate to which he refers did not get an absolute majority and was passed only because a number of members abstained on the basis that, without knowing the detail, we have no way of judging whether the SNP's proposal would be fairer. I also remind the member that fairness is only one of many criteria.

Jamie Hepburn (Scottish National Party, Central Scotland)

Members can, of course, choose to abstain from any vote. On that day, we secured a majority, which I take to be our agreeing on a starting point, at least.

We know that, out in the country, the people of Scotland are considering the merits of a local income tax. The survey for the University of Strathclyde that my colleague Joe FitzPatrick mentioned showed that 88 per cent of people in Scotland believe that local services should be funded through a tax that is based on income rather than one that is based on property values. The reason is simple—people will be better off. The tax will be a particular help and relief to Scotland's poorest and most vulnerable households and it will make Scotland a fairer place in which to live.

We hear an alternative view from the Labour Party, but it is hard to take Labour seriously when it so recently increased the tax burden on hundreds of thousands of low-income citizens in Scotland. Gordon Brown should be ashamed of himself. The perverse tax hike for our poorest citizens—the very vulnerable groups that Labour members go on about—stands in stark contrast to the SNP Government's intention to make local taxation fairer.

If the Parliament unites around the proposal and a local income tax is introduced, it will be the single biggest social democratic, progressive change that can be made in Scotland under the powers that are available to us under the devolution settlement. Perhaps that is what the Labour Party fears the most about a local income tax—it represents the radical, progressive social change for which people thought they were voting in 1997, only to be sorely disappointed.

Margo MacDonald (Independent, Lothians)

Will the member give way?

Jamie Hepburn (Scottish National Party, Central Scotland)

No, I am afraid I will not.

The SNP seeks to maximise the Parliament's powers because we believe that that is the way in which to improve people's lives throughout Scotland. We can radically change them for the better.

No form of taxation will ever be universally approved of, but we can make tax fairer. To me, doing so necessarily means having taxes that bear some relation to people's ability to pay. That means a local income tax and not the unfair council tax.

David McLetchie (Conservative, Edinburgh Pentlands)

The SNP's plan to introduce an unfair, wholly bogus, so-called local income tax is coming apart at the seams. Its many faults and failings have been well exemplified in the speeches that we have heard so far. In my remarks, I will focus on the fundamental issue of legal competence and whether the SNP's proposal could be translated into law with regard to the terms of the Scotland Act 1998.

Schedule 5 to the 1998 act reserves to Westminster the levying of taxes and excise duties. However, there is an exception, which is described as

"Local taxes to fund local authority expenditure (for example, council tax and non-domestic rates)."

It is self-evident that, for the purposes of interpreting the 1998 act, a tax is not a local tax just because it is called a local tax. It must, in substance, be a local tax by reference to its characteristics. Moreover, the fact that the proceeds of a tax are used to fund local authority expenditure does not make it a local tax. If that were the case, the phrase "local taxes" would have no meaning, nor would there be a need in the legislation for the descriptive examples of council tax and non-domestic rates.

If the SNP's view were correct, the Scottish Parliament could legislate for any tax as a so-called local tax just because it was used to fund local authority expenditure. On that flawed line of reasoning, the Parliament would have the power to introduce a Scottish national sales tax, excise duty, capital gains tax, inheritance tax and corporation tax. When one bears it in mind that the total expenditure of local authorities in Scotland is more than £11 billion, on the SNP's Government's flawed analysis there is ample scope for a range of national taxes to fund that expenditure. Patently, that cannot be right. It was most certainly not the Westminster Parliament's intention when it passed the 1998 act.

To be within the competence of the Scottish Parliament, a local tax has to have local characteristics. Such characteristics are wholly absent from the SNP's proposal. The rate of tax is to be set nationally, and the tax is to be assessed, collected and distributed nationally. By contrast, if we consider the council tax and non-domestic rates, although one is set locally and the other nationally, they both have strongly localised characteristics because they are based on the capital and rental values of properties, which are assessed locally, held on local valuation lists and collected locally by our councils.

The SNP Government takes umbrage when anyone has the temerity to suggest that its plans are fatally flawed. It should address the serious issue, but all that we get is bluster about interference from London. Frankly, that is not good enough. The SNP Government and the Parliament have a responsibility to conduct themselves within the parameters that were set by the Scotland Act 1998 and to legislate only when it is competent to do so. As a party, the SNP might want to kick against those traces, but as a Government it does not and cannot have that luxury if it is to act responsibly. The SNP's plan is not competent. It is not a local income tax but a Scottish national income tax. It is out of order.

Richard Baker (Labour, North East Scotland)

We have heard many criticisms of the Scottish Government's proposed local income tax, not least because, as Mr McLetchie said, it is not a local income tax at all. There is wide agreement that the term is a misnomer. The tax is indeed a nat tax—a national income tax. I will focus on two key areas of the debate: first, the impact of the tax on families, with particular reference to younger people; and, secondly, its impact on the provision of key local services, particularly those for the vulnerable.

Labour has pointed out repeatedly that the proposal will hit families with two or more incomes. That relates to the question that Margo MacDonald posed earlier. I am talking not about families where those in employment are on extravagant incomes but about people who have jobs with average salaries. Both we and the Scottish Conservatives have released estimates of how much extra such families would have to pay. In many cases, it is hundreds of pounds, and I made similar findings about the impact of the Government's proposal on families in the north-east. It is as much of a fantasy to say that four out of five families will be better or no worse off as it is to say that the proposal will be popular throughout Scotland.

A great many families in today's Scotland have two or more incomes coming in, not because they are wealthy but because many young people are staying in, or moving back to, the parental home. The Scottish household survey figures for 2006 show that almost half of 20 to 24-year-olds were living at home. A huge number of people are affected. Many such households will pay more because the young people are working. At present, students are exempt from the council tax, but they will be subject to local income tax if they are in employment while studying.

I am afraid that young people are staying on in their parental home not purely because of their affection for their parents but because of an issue about which every party in the Parliament has expressed concern: the affordability of housing.

Joe FitzPatrick (Scottish National Party, Dundee West)

Will the member take an intervention?

Margo MacDonald (Independent, Lothians)

Will the member give way?

Richard Baker (Labour, North East Scotland)

I give way to Margo MacDonald.

Margo MacDonald (Independent, Lothians)

Does the member agree that that is why there is so much concern about the income tax that will be levied on the young people to whom he refers?

Richard Baker (Labour, North East Scotland)

The position of those young people is crucial. I take that point entirely.

Joe FitzPatrick (Scottish National Party, Dundee West)

Will the member take an intervention?

Richard Baker (Labour, North East Scotland)

I am sorry. I must make progress.

Many young people are staying with their parents to save money so that they can get on to the housing ladder. They will find it more difficult to save under a local income tax because, although they are not required to pay council tax, they will be required to pay local income tax.

The second issue on which I want to focus is the huge, £800 million funding hole in the Scottish Government's proposals. The potential impact of that is of grave concern. Either the Scottish Government would have to admit that sufficient funds could not be raised on the basis of a 3p hike and that the rate would have to be much closer to the 5p that the Burt commission said would be necessary, or there would be even more swingeing cuts to local services of the kind that we have seen in Aberdeen, where the administration, which includes party colleagues of the cabinet secretary, has instigated £27 million of cuts that most affect people with disabilities and older people, as well as young people who have had their access to sporting facilities restricted. It has been suggested that the First Minister will intervene personally in the situation. I would be interested to hear the cabinet secretary enlighten us on that.

The reason why I found Jamie Hepburn's speech so perplexing is that I fear that the Scottish Government will not hesitate to axe vital local public services for its own political purposes in relation to this policy. It is clear that its sums do not add up and that the most vulnerable people in Scotland are likely to pay a high price for that.

The debate has shown that the nat tax proposals are neither progressive nor advantageous for hard-working Scottish families. The proposals are shambolic. On all counts, the proposals are not worthy of approval by the Parliament. That is the message that should come loud and clear from Parliament this morning.

Bob Doris (Scottish National Party, Glasgow)

On 21 June 2007, the Parliament stated its view that a local income tax based on the ability to pay was a much fairer system of local taxation than the discredited and unfair council tax. It is time to take the next step and move to the delivery of that parliamentary position. That is what the parties that wish the council tax to be abolished are trying to do.

Derek Brownlee (Conservative, South of Scotland)

Will the member take an intervention?

Bob Doris (Scottish National Party, Glasgow)

No thank you. I have only four minutes and I want to make my points clearly.

What we have from the Labour Party this morning is an attempt to turn back the clock and defend the council tax. It is pretending that the Parliament has not already taken a view, that all is rosy with the council tax and that the Scottish public support the council tax. Such pretence and self-delusion will not help my constituents in Glasgow or the people of the rest of Scotland.

In Glasgow, the council tax has increased by almost 51 per cent—by £408—since new Labour swept to power in the UK. It is hardly any wonder that 88 per cent of Scottish people favour taxation for local services based on income over the council tax.

Citizens Advice Scotland is equally keen to see the end of the council tax. In 2005, it called on the previous, Labour and Liberal Democrat Executive to

"examine fully alternative means of local government taxation, and introduce a fairer and more cost effective system as soon as possible."

I am delighted that, free from the shackles of the partnership agreement with the backward-looking Labour Party, the Liberal Democrats can now play their part in answering the call of Citizens Advice Scotland, along with the SNP Government.

Labour is determined to persevere with the council tax. I will highlight three problems with the council tax that would be solved by the introduction of a local income tax based on the ability to pay.

The first problem is that we all know that the council tax discriminates against Scotland's pensioners and low-paid workers, because it takes no account of their ability to pay. A constituent of mine in Glasgow might have worked all their life to earn a modest salary and then find themselves retired and struggling on a fixed income. Labour does not seem to care about that. Is its advice to those pensioners that they should pay up or sell up? The SNP will treat our pensioners with a lot more respect than the Labour Party will. That is why, under a local income tax, the average pensioner couple will be £717 better off per year.

The second problem is that at some point Labour will have to face up to the desperate need for a revaluation of Scottish properties if it wants the council tax to have a future. Labour put off the pain of a property revaluation when it was in power, but it cannot possibly believe that in 2008 a property-based council tax should be predicated on the house prices of 1991. A Labour revaluation would be bad news: it would force an estimated 750,000 Scottish households to pay more. With a local income tax, the need for such a revaluation would disappear completely.

The third problem is the potential unknown. Thousands of houses in Glasgow alone, and many more throughout Scotland, have been banded too high. I have discovered a number of such properties in Glasgow, and in conjunction with SNP councillors I have managed to get them brought down to the correct banding. That means that the householder, quite rightly, gets refunded previous overpayments, which often date back several years. It also means that there is a direct loss of revenue to local authorities, which, quite rightly, have to make good those overpayments from their funds. A local income tax will prevent future injustices to home owners on that front and prevent local authorities being exposed to such financial liabilities because of inaccurate bandings.

The Scottish Government wishes to take forward a scheme of progressive local taxation based on the ability to pay. The Labour Party has no answer and no way of reforming the council tax. I would like to hear in its spokesperson's summing up what its alternative is.

Patrick Harvie (Green, Glasgow)

Andy Kerr began the debate and appeared to endorse the concern that we should not replace one bad tax with another bad tax. That was an implicit acceptance that the council tax is a bad tax. The only question that we have to ask ourselves is, what are we going to do instead? I am sorry that no one from the Labour Party has answered that.

In responding to interventions, I suspect that John Swinney spent more time than he would have liked on answering the question whether the local income tax is local or national. The Scotland Act 1998 can clearly be read one way or another by people, depending on their agenda.

David McLetchie (Conservative, Edinburgh Pentlands)

Rubbish!

Patrick Harvie (Green, Glasgow)

I would like to continue, if I may. It is clear that a similar previous scheme was not considered incompetent by the previous Presiding Officer. I am sure that the current Presiding Officer is looking forward to making such a decision at some point.

Would the proposal reduce local democracy? That is the more important question. The attack on local income tax or salary tax should be that it is a bad policy. An attack that comes down to blocking tactics will be destined to fail, because it will amount to the UK authorities being seen to look north and say, "No, you cannae." Tavish Scott and I are rarely on the same side of a debate. However, we were on the same side at least with regard to the amendment, if not with regard to his policy. Like others, Tavish Scott is concerned to ensure that councils continue to have the freedom to raise some of their revenue. I agree, but he failed to address the complex consequences, with which we are all familiar, to which his plan would give rise. We can all imagine a scenario whereby two work colleagues in a shop, hospital or office do the same job, but one of them knows that month after month there is less in their pay packet than in their colleague's, not because they work less hard or achieve less, but because they live on the other side of a local authority boundary.

Tavish Scott (Liberal Democrat, Shetland Islands)

I accept Mr Harvie's contention that there will always be complexity in proposals for changes in taxation. However, he was not terribly clear about how complex his proposal would be. I would be grateful if he would tell us.

Patrick Harvie (Green, Glasgow)

The Green party has been clear for years that our policy is land value taxation—it was once the Liberal Democrats' policy, too.

However, my attack on Tavish Scott's proposal is that, although I support local flexibility, salaries are the wrong basis for local variability. A new Scottish salary tax would be in danger of becoming even more unpopular than the council tax—and quickly, too.

Derek Brownlee made the case that as long as local income tax remains on the Government agenda, reform will not happen. I say the opposite: reform must happen, and until those of us who accept the need for reform but want a property element to remain propose something clear and specific, it would be wrong to close down the argument.

Although we in the bad kids corner enjoyed the idea of a broad interpretation of Holyrood's tax-raising powers, David McLetchie's attack was on the competence of the proposal.

My greatest disappointment is that not one single Labour member had anything positive to say about what they would do instead of introducing a local income tax. If the council tax is a bad, unpopular tax, as Andy Kerr seems to accept, let us agree to my amendment, endorse the need for reform and spend the rest of our time debating the basis of that reform, subject to the criteria that my amendment lays out.

Liam McArthur (Liberal Democrat, Orkney Islands)

It is not difficult to understand why we are having this brief debate this morning. The leader of the Labour Party, after months of unrelenting bad publicity and personal attacks—some of them even coming from members of other parties—has had some joy of late in putting the First Minister on the spot over the detail of the Government's proposals for reforming the system of local taxation in this country.

As my colleague, Tavish Scott, made clear in his opening remarks, Liberal Democrats agree with some of the criticisms of the Government's approach. We have made it clear not only that any system of taxation should be based on the principle of fairness, and therefore the ability of an individual to pay, but that, in the case of local tax reform, the principle of local accountability is also essential. Frank McAveety and Peter Peacock made some valid points in that regard.

However, we entirely support the Government's initiation of a consultation on the future of local taxation. The consultation will conclude in July, and will enable the various parties' different approaches to be considered and tested before proposals are put to this Parliament for debate and, ultimately, a vote. That approach is sensible and constructive.

David McLetchie (Conservative, Edinburgh Pentlands)

Does the member think that the Government's consultation document is a more substantial piece of work than the report of the Burt committee, which was commissioned by his party when it was in Government?

Liam McArthur (Liberal Democrat, Orkney Islands)

The consultation is a sensible and constructive approach and I look forward to seeing the Tories' contribution to it.

So, why are we having this debate today? What this debate has exposed is that Labour and the Tories will say and do anything to prop up the discredited council tax, even though they concede that it unfairly penalises pensioners and others on low fixed incomes. Many members have highlighted the complete lack of detail in Labour's motion. In the past, Labour talked about introducing new council tax bands. However, Gordon Brown's abolition of the 10p income tax rate has not only clobbered lower income families but done serious damage to Labour's taxation credentials, particularly when it comes to bands.

Rebanding has other consequences. To split the top and bottom bands, a revaluation would be required. It would then be inconceivable that the other bands would not be revalued—after all, council tax cannot forever be based on 1991 house prices. There are lessons to be learned from what has happened in Wales. When revaluation goes ahead, millions face an unfair rise in local tax bills—rises that are not linked at all to the ability to pay.

Margo MacDonald (Independent, Lothians)

Will the member give way?

Liam McArthur (Liberal Democrat, Orkney Islands)

I am sorry, I do not have time.

The Tories, too, cling faithfully to the council tax. After their experiment with the hated poll tax, they believed that they had hit upon a vote winner, yet even the Tories have had to accept the serious flaws in the council tax. However, not surprisingly, their response to those flaws has been not progressive but opportunistic and inconsistent. First, we had promises of cuts in everyone's bills, with a larger rebate for pensioners, irrespective of their ability to pay. The Tories' next position was that only pensioners would benefit from their largesse. However, the Institute for Fiscal Studies exposed their plans as not benefiting the poorest pensioners at all, but instead targeting most resources on the richest 10 per cent of pensioners. The Tories' latest wheeze is to propose an across-the-board cut for all council tax payers, again despite the fact that that would target more resources on the more well off and would fail those who are least able to pay.

Labour is wedded to the council tax, despite Andy Kerr's suggestion that it is a bad tax, and the Tories refer to it as being "as fair a tax as you'll find". Richard Baker and Joe FitzPatrick raised the issue of tax and popularity, which are not natural bedfellows, but it is true to say that the council tax was recently voted the most hated tax. To do that, it had to fight off stiff opposition from fuel duty, which is no small feat in my part of the world.

The suggestion that the United Kingdom Labour Government would try to withhold £400 million that is currently paid to Scots through council tax benefit is nothing short of scandalous.

Liberal Democrats do not believe that the sticking plaster solutions offered by Labour or the Tories are sufficient. Council tax cannot be fixed. It needs to be removed, and it should be replaced with a genuinely local income tax that is based on ability to pay.

Gavin Brown (Conservative, Lothians)

Five weeks ago, the local income tax was a flagship policy of the SNP Government. However, after relentless attacks, lots of scrutiny and tough questions, it remains a dog with fleas that, I hope, we can get rid of as soon as possible.

The SNP is so desperate today that it has not gone for the usual last-ditch tactic of bringing in Mike Russell to give the closing speech in the hope that he will have some kind of defence.

Serious issues have been raised in relation to this national income tax, on the grounds of both its legality and substance.

David McLetchie succinctly outlined the arguments around the legality of the tax, but it is worth reading again the relevant line in schedule 5 to the Scotland Act 1998:

"Local taxes to fund local authority expenditure".

The word "Local" is critical.

Margo MacDonald (Independent, Lothians)

On the matter of legality, do we not also have to consider the legitimacy that is conferred on elected representatives by voters? Voters voted against having a council tax.

Gavin Brown (Conservative, Lothians)

The Scotland Act 1998 is particularly clear on the matter. Margo MacDonald might not like it, but that act was clearly passed, and it is the legislation that we have to work under.

Until today, the Government's only response to the question about the legality of the tax was from Mr MacAskill, who said in the press, "That's nonsense". Today, Mr Swinney has merely used a tautological argument, saying that the tax will be used to fund local services. We have heard no arguments whatsoever about how the word "local" fits in to the Government's analysis. The tax will not be set locally, the values will not be assessed locally and it will not be collected locally.

I issue a challenge to the Government. I am fairly sure that it will have taken legal advice in advance of its consultation. What did that legal advice say? The Government's enthusiasm for the tax has certainly gone down since the consultation started. Will the Government publish the legal advice that it was given on the national income tax? Let us see what its legal advisers said about the legality of the tax.

On the substance of the tax, we have heard a number of powerful arguments against the proposal. We have heard that it will penalise hard-working families, especially those with two earners in a household. We have published information over the past week or so that shows that the average two-income household that is currently paying the average council tax will be £289 a year worse off under the local income tax.

We have heard about the shortfall, which even the Government concedes will be at least £281 million. If it can find that money through savings—or cuts or whatever it wants to call them—it could equally use that money to fund a council tax discount, as outlined by Derek Brownlee.

We have heard powerful arguments about the loss of local authority autonomy. Currently, local authorities raise 20 per cent of their income. Under the Government's proposal, that would go down to zero. Do we want local government or do we simply want local administration? The national income tax will lead to local administration.

We have heard about the additional costs. The new tax would cost £30 million to collect and, according to the Burt report, would place a burden of an extra £28 million on businesses.

The Government's flagship policy has become a mess. It is unworkable, unfair and, most probably, unconstitutional. We do not need another tax on the Scotland that gets up in the morning. It is time to ditch the idea.

John Swinney (Scottish National Party, North Tayside)

Margo MacDonald made a number of points. One that merits particular attention is her point about the impact of the current economic circumstances on the household budgets of families in Scotland. She is quite right to highlight the significant unease that exists in households about mortgage costs and other increased costs—Mr McArthur mentioned fuel and there has been clear information about rising food prices. That makes the Government's determination to freeze the council tax and give some respite to families facing financial difficulties all the more justifiable.

In the course of this debate, which has been interesting—I am sure we will have many more such debates—Tavish Scott has been criticised, particularly by the Conservatives, for engaging with this Government in discussions about the formulation of our local income tax policies.

Tavish Scott (Liberal Democrat, Shetland Islands)

Which is rich, coming from Derek Brownlee.

John Swinney (Scottish National Party, North Tayside)

Mr Scott's comment from a sedentary position makes my point. As the Conservatives know full well, their party engaged in constructive discussions with the Government that were influential in changing our priorities in relation to other areas of our budget, and we secured from Parliament support for that budget. [ Interruption. ]

I hear Johann Lamont muttering, as usual, from the Labour benches. Perhaps if she had learned something from the approach of Mr Scott and Mr Brownlee, she might be in a slightly more influential position rather than someone who simply mutters from the left-hand side of the chamber.

This is a minority Government. We have to work with other people and engage in discussion and dialogue. That is why we have launched a consultation paper on local income tax to engage with others and seek their contributions. Patrick Harvie's amendment encourages the process of debate within Scotland. It is a welcome debate, if we bear in mind the fact that one of the critical issues in the election campaign was the level of dissatisfaction with the council tax. That was not a peripheral issue—it dominated a number of debates during the campaign.

Patrick Harvie and other members, including Tavish Scott, were right to say that the Labour Party, after eight years in government, during which it could have reformed the council tax, offered proposals in the election campaign that hardly lasted a moment after their launch. The proposals were not mainstays of Labour's arguments—it could not substantiate the changes. It is a bit rich for Labour members to come to Parliament and lecture me about bringing forward reform proposals when the Labour Party singularly failed to do so.

Margo MacDonald (Independent, Lothians)

In interpreting what voters thought of what the Labour Party said, will the cabinet secretary accept that voters thought that the SNP's proposed local income tax would mean not that everybody in a family would pay but that only the person who paid the hated council tax would pay?

John Swinney (Scottish National Party, North Tayside)

That requires a degree of psychological analysis that I do not have at my disposal today, but I will find out if there is any research.

On the subject of research, the Labour Party commissioned the Burt report, which has been much cited in this debate. The independent Burt committee came up with a proposition. I remember it vividly, because it was rubbished by the Administration before it was even published, and yet Labour cites it here.

Frank McAveety—who made, to be fair, a thoughtful speech in today's debate—made a point about the importance and sanctity of local accountability. The Burt committee said:

"The Committee have been unable to find any evidence in any of our research as to why accountability is enhanced by local government having its own tax-raising powers."

I do not agree with that point of view, but it was expressed by the Burt committee and cited by the Labour Party. Labour did not bring a roof tax forward, because it is bereft of ideas in this debate—that is why it is no longer in office.

One of the fundamental revelations in the debate was that Andy Kerr made it absolutely clear that the Labour Party in Scotland supports Her Majesty's Treasury's argument that council tax benefit should not be part of funding for local authority services in Scotland. There we have it: a £400 million cut in Scottish public services and finances initiated by the United Kingdom Government and enthusiastically supported by the Labour Party in Scotland. If that is what Labour members mean by standing up for Scotland, it is no wonder that they are sitting on the Opposition benches.

Andy Kerr (Labour, East Kilbride)

Mr Swinney's financial incompetence comes to the fore. I was not quoting the Treasury when I said that that money was not due to Scotland; I was quoting Sir Peter Burt and many other learned professors and commentators who all agreed at the outset of the debate—as the SNP knew fine well when it drafted its manifesto—that council tax benefit money was not going to come to Scotland. That money is paid to individual families, not to individual Governments—local authorities get that resource because of the profile of the communities within their areas.

I remind members of some of the comments that have been made about local taxation. First, I remind Patrick Harvie that it was John Swinney who said:

"Our conclusion is that there is no point in replacing one bad system with another".—[Official Report, 1 February 2006; c 22902.]

I contest that the local income tax system—which is not local; we all know that it is national—is a bad system.

The debate has been about many key issues. First, no-one—not one commentator, professor or journalist—will stand up the SNP's contention that the rate is somehow going to be 3p in the pound. As a result, we have the misleading myth from the SNP that, somehow, 90 per cent of Scots will benefit from the proposal. That is based on a flawed figure of 3p in the pound, which we know will not be the rate.

Many members spoke eloquently about local accountability. It is interesting that Mr Swinney said in 2006:

"Local communities would be in control of how much they wished to contribute to pay for local services."—[Official Report, 11 May 2006; c 25491.]

That will not be true under the SNP Administration's proposals.

Christine Grahame has said:

"We cannot expect people in the Borders to pay the same local income tax as people in Glasgow because they have different needs and requirements."—[Official Report, 11 May 2006; c 25515.]

However, under the nat tax people would pay the same. With regard to local accountability—I disagree with Sir Peter Burt's point—the SNP in opposition made the point that every member in the chamber bar SNP members is now making: the national income tax would remove one of the key primary responsibilities and accountabilities of our local authorities.

Other members, such as Margo MacDonald and Richard Baker, made interesting points. It is indeed working families in Scotland who will pay. When the SNP was trumpeting its alternative to the council tax, it did not point out with absolute clarity the following points: that more than three-fifths of Scottish households have more than one earner; and that, as Richard Baker pointed out with regard to the household survey, in many homes there are young earners, all of whom will be individually liable for the nat tax. Nurses in training and students will be liable for the nat tax. That is not fair on them or on Scotland's hard-working families.

John Swinney talked about launching manifestos and documents—those did not last long. I squirmed when I saw him on "Newsnight" on the very day the local income tax proposals were launched. He could not answer any basic questions about the so-called flagship policy. He should not lecture me or anyone else about the issues.

With regard to David McLetchie's speech, the reason that Scotland should not have the tax is that it is a bad tax and a bad way to raise money for our local services. It would be interesting, as Gavin Brown said, to see the legal advice. I am happy to hear the cabinet secretary's view on that point. Will he publish the legal advice that he was given, so that we can understand where the Government is coming from and put the issue to bed? That would help us all to progress the debate.

Some members made points about pensioners. Those pensioners who pay income tax will continue to pay the nat tax; they will not get away with it. The SNP should not lecture the Labour Party about pensioners. We introduced the free national travel scheme and the free central heating scheme, and did much other work for pensioners. In 2007, we would have immediately halved pensioners' water charges, which would have had a real benefit straight away, and we would have subsequently removed the water charges in their entirety. That would have been real action to help pensioners, rather than the SNP bringing forward its flawed proposal. Our response is clear on the key issues that have been raised about pensioners.

Mr Swinney should make clear the proposal's legality by publishing the legal advice. With regard to local democracy, why does the SNP not live up to some of the words that it used when it was in opposition, instead of selling out today with a national income tax that will be levied from the centre? Other members have raised points about the administration of the system. Not only will the Treasury—presumably—raise the so-called local income tax, but other issues will be involved, such as taxes on second homes. What will we do about that? Who will collect the water rates? What is the burden on business for collecting the national income tax?

I return to the comments that I made in my opening speech. The proposal is ill-thought through, ill-judged and ill-measured. There has been no consideration of impact, and the consultation document is frankly embarrassing in its lack of detail. Publishing such a Government document is an abject response to a key debate in Scotland.

I will finish by considering some of the economic impacts. Jim Mather said in the debate about a Scottish service tax—which the SNP's proposal is essentially a version of—that it would cause a flight of the best brains out of Scotland. That is what the SNP's proposal will do. The economic impact will be high, given the adverse impact of the marginal rate of tax, and it will be bad for business and bad for the Scottish economy. The Confederation of British Industry says that it is misguided, and the Institute of Directors and the Federation of Small Businesses say that it is anti-business. With regard to the SNP's economic strategy, those organisations completely condemn the proposal. Business does not like it, the unions do not like it, local government does not like it and we do not like it. The Government should drop it.

Voluntary Sector

Alasdair Morgan (Scottish National Party, South of Scotland)

The next item of business is a debate on motion S3M-1706, in the name of Elaine Murray, on support for the voluntary sector. Time is short, so members' speaking limits will have to be strictly adhered to.

Elaine Murray (Labour, Dumfries)

According to Scottish Council for Voluntary Organisations statistics, there are 45,000 voluntary organisations in Scotland, 1.2 million people are involved in volunteering, and the sector employs 130,000 paid staff, three quarters of whom are women. The sector's annual income amounted to £3.87 billion in 2007. Its value to Scottish society and the economy cannot be denied.

The third sector relies significantly on the public sector for income. In a report that was published in February last year for the previous Executive, half the organisations that were surveyed stated that they relied on public sector contracts for over 80 per cent of their income. Of those contracts, 53 per cent were with local authorities and 23 per cent were with central Government.

The historic concordat that the Government is so proud of has changed the mechanism by which funding is allocated to the voluntary sector. In the main, ministers have relinquished responsibility to local authorities and, in doing so, have passed to them the blame for cuts. Labour members warned that there was a danger that if councils were under financial pressures, funding to external organisations would be hit first as local authorities protected their statutory obligations. Funding streams that provide services to vulnerable or disadvantaged individuals may therefore be at risk. The Government said that we are scaremongering, but let us consider some of the evidence so far.

In Aberdeen, there has been a £900,000 cut in funding to the Cyrenians, which provides services to the homeless; £650,000 of revenue support has been withdrawn from the Glencraft workshop; and £120,000 a year has been withdrawn from the Richmond Fellowship, which is a mental health charity. However, voluntary sector cuts have not been confined to Aberdeen. In Edinburgh, the withdrawal of financial support from the Workers Educational Association may result in the loss of premises and staff, and consequently of adult education in the city. In the Highlands, Age Concern has lost £86,000 of council funding. In my area—Dumfries and Galloway—£90,000 of the funding of Independent Living Support, which helps people with drug and alcohol dependencies to sustain tenancies, has been cut, and almost £400,000 has been cut from the Loch Arthur project, which supports people with learning disabilities and runs a successful social enterprise. I understand that, across Scotland, Quarriers is facing cuts this year that total £1.1 million.

On 10 January, the First Minister claimed that there were

"attempts to scaremonger to vulnerable groups throughout Scotland"—[Official Report, 10 January 2008; c 4930.]

I am not making such attempts; I am talking about cuts in funding to real organisations that provide real services to real people.

On top of such cuts, uncertainty exists about eligibility for new funding streams, such as the fairer Scotland fund, which will flatline at £145 million over the spending review period. That represents a real-terms cut of 8 per cent by 2010-11. Major national charities, such as the Prince's Trust, have expressed concerns about the demands that will be placed on them if they are required to apply to 32 different local authorities instead of to one national fund.

There could be worse to come. In the face of the uncertainties that exist about future funding, many councils have, for the time being, rolled forward existing spending commitments, but that approach may be impossible to maintain if funding pressures build further. That is why we will support the Liberal Democrat amendment in the name of Robert Brown, which calls for a review of the operation of the concordat after its first year.

The truth is that one year of Scottish National Party Government has, despite that Government's warm words, reduced the voluntary sector's funding and influence. I want to expand on the latter.

The previous Scottish Executive worked with the SCVO and the Convention of Scottish Local Authorities on a strategic funding review for the third sector, which examined, for example, the implementation of full cost recovery. That principle, whereby third sector organisations are fully reimbursed for provision of services, including overheads, was endorsed by Her Majesty's Treasury in 2002. I ask the ministers what the current status of that review is and what is happening with respect to the previous Executive's commitment to three-year funding for voluntary sector organisations. Voluntary sector organisations cannot survive being put on hold while details of single outcome agreements, the Scottish investment fund and the fairer Scotland fund are being worked out. The consequences of delay for them are redundancies, demoralisation of staff and, ultimately, reduction of services. Will the Government provide transitional funding for organisations that are affected to enable them to survive until the new funding streams are in place?

The Scottish Trades Union Congress has highlighted concerns about the insecurity of third sector employment contracts, lower wages and poorer conditions of employment as organisations compete to secure contracts. The practice of reverse auctions, for example, whereby authorities advertise care package requirements to attract the lowest bidder, encourages undercutting not only of the public sector, but of other third sector organisations. The third sector's voice needs to be heard, and voluntary sector interests must be represented in the single outcome agreement negotiations. How do ministers intend to ensure that voluntary sector organisations have a seat at the community planning table?

Our motion urges that the funding that has been removed from Project Scotland be reinstated. Independent assessment found that that funding was worth at least £21.4 million to the Scottish economy, that it was 10 times more effective than the jobseekers scheme in getting young people into sustainable employment, and that it delivered £9 million-worth of benefits to partner organisations. If the Government's amendment indicates a rethink on its position, I welcome that, but I question whether the Government appreciates that the third sector is not only about social enterprise. Social enterprises are valuable and important, but aspects of the voluntary sector are about support and sustaining very vulnerable people—they are not really about enterprise. I am not convinced that the ministers appreciate that.

Finally, the previous Executive further extended the exemption from paying water rates for the vast majority of church and village halls from 2006 to 2010. Scottish Labour's response to the Government's consultation on water charges for the next period, from 2010 to 2014, argued for a further extension. I have read the Government's amendment and am absolutely delighted that it has accepted our position.

I move,

That the Parliament applauds the vital contribution made to society and the economy by the voluntary sector; is concerned that pressures on local authority budgets over the period of the spending review will lead to cuts in support to voluntary sector organisations and inadequate payment for the services that they provide; recognises the role that volunteering can play in personal development and urges ministers to restore funding to Project Scotland, and believes that the exemption from payment of water rates extended by the previous administration to 2010 should be further extended.

Jim Mather (Scottish National Party, Argyll and Bute)

I am pleased that the third sector is the focus of today's debate and that the motion acknowledges its vital contribution to delivering a stronger, better and more cohesive Scotland. My colleagues and I have made it clear on many occasions that the Scottish Government strongly supports that sector's work and that it wants to see the sector thrive and grow. That is why the Government is making £93 million available to it over the next three years, which represents a massive 37 per cent funding increase. Consequently, I believe that the Government amendment better reflects the support that exists for the sector. I will say why.

George (Labour, Lothians)

If the minister is right and the SNP is so enthusiastic about the third sector, why are so few back-bench SNP members in the chamber?

Jim Mather (Scottish National Party, Argyll and Bute)

They are out engaging with their constituents and with people in the third sector. That is in the nature of the job we do.

There is a new relationship between the Government and the third sector and between the third sector and local government. That is a key by-product of the concordat. The aims are to help the public sector to access the vital transformational potential of the third sector at local level, and to harness the innovation and quality that it offers in delivering real improvements to people's lives and in stimulating growth. We are convinced that the third sector has that potential.

Johann Lamont (Labour, Glasgow Pollok)

Will the minister take an intervention?

Jim Mather (Scottish National Party, Argyll and Bute)

No, I will not. I will crack on and ensure that the groundless fears, uncertainties and doubts that are being inculcated by the Labour Party are expunged. We are going to get on the record what we are actually doing, as opposed to the nonsense that Labour members are breeding.

We want local authorities, community planning partnerships and the third sector to work together increasingly closely and collaboratively to deliver better services to their communities. The sector's ability to reach people who are currently not economically active but are desperate to reconnect with the world of work, and to gain increased economic wellbeing and a renewed sense of purpose, should be used. That is what we are about. We are also about ensuring that the third sector helps to design public services that more closely meet the individual needs of real people and their communities, and that that sector can be the catalyst that pulls together and fills the gaps in other public services. It is no surprise that, for local authorities, the third sector can be an essential element in service delivery and in keeping in close touch with communities.

New opportunities exist for councils, which are now free to decide what their priorities are and are free to choose how to secure those priorities. Our approach also creates the opportunity and the motivation for councils to scope and assess both the needs in their areas and the capability of the communities to be involved in meeting those needs. That demands a new and positive approach from councils and communities. Consequently, we are focusing strongly on how the third sector plays into this burgeoning sense of localism. The new arrangements bring a strong focus on the community planning partnerships, offering them a heightened sense of purpose and the means to increase community spirit.

Rhona Brankin (Labour, Midlothian)

On localism, two days ago I met representatives of Quarriers who told me that, as a whole, Quarriers has suffered cuts of £1.1 million in this year alone. That is adding up what has happened in many local authorities throughout Scotland. Is the Government interested in what is happening as a whole? Is it monitoring what is happening to charities such as Quarriers?

Jim Mather (Scottish National Party, Argyll and Bute)

We are monitoring and listening. I regret to say that Quarriers has not approached me or my officials directly, which is a problem.

The community planning partnerships are the key element in our trying to effect change and create a new landscape with a much better sense of cohesion out there in the sector. We have categorical proof that the micromanagement style of the Labour Party is essentially a harking back to stasis, and we know that stasis is a recipe for extinction. We must move on.

Of course, we need stability, especially in financial matters, and we are committed to delivering the long-term funding that will make that possible. We are committed to developing local compacts and to moving them forward in a concentrated way. We are also reinforcing local decision making by ensuring that councils for voluntary service and volunteer centres are well funded in 2008-11. They are working closely with us on a strategy that they wish to see, in which they will thrive and connect better with local authorities and in which they will increase local authorities' awareness of the value that can be delivered by the sector. We are working to ensure that that is an absolute success.

We have discussed Project Scotland in some depth in the chamber. We are continuing to fund Project Scotland with a grant of £1.4 million to continue its work in encouraging people of all ages to take part in volunteering. We are also investing a substantial amount of money in the volunteer centres to ensure that, across the board, more people are entering the world of volunteering. Our support for volunteering is clear and unambiguous.

A strong case for retaining the water charges exemption has been made by the voluntary sector through the consultation process that we have initiated. We agree that the principle should be supported and, in due course, we will set out in full our response to the consultation to ensure that people understand our position.

We are driving forward to connect better with local communities and to ensure that the third sector flourishes and grows. Consequently, I trust that members will support the Government's amendment.

I move amendment S3M-1706.2, to leave out from the first "voluntary" to end and insert:

"third sector; believes that co-operation between the third sector, local authorities and the Scottish Government is vital in ensuring a strong role for the third sector; recognises that the Scottish Government is funding Project Scotland and has made clear to Project Scotland that further resources may be available for projects it runs in terms of the Scottish Government's employability agenda, and believes that the exemption from payment of water rates extended by the previous administration to 2010 should be further extended."

Derek Brownlee (Conservative, South of Scotland)

This has the potential to be a constructive and useful debate, but that is not a preordained outcome, of course. Elaine Murray's speech was very thoughtful and she raised some valid points. I agree that we should applaud the vital contribution that is made by the voluntary sector. Throughout Scotland and in all walks of life, volunteers make massive contributions to their communities. Throughout the United Kingdom, including Scotland, their contribution has perhaps not been valued as strongly as it should have been, and they have perhaps not received the support—under all parties—that they deserve. It will be useful if we can focus on what the voluntary sector can achieve.

I welcome the fairly strong hint from the minister that the lobbying on the water rates exemption has been successful. If the exemption is extended—as the minister seems to have all but conceded—that will make a major contribution to many organisations throughout the country. All MSPs have been lobbied furiously by organisations in their constituencies and regions. It is an important issue to the voluntary sector, and it is very good news if the exemption is to continue.

I will focus on the role of the sector, not just in terms of what it does but in terms of what it could do and how we can help it to achieve more. My amendment focuses on the need to reduce the burden of red tape. We all agree that red tape is a problem not just for business—although it is often cited in the context of business—but for voluntary organisations, which it affects as much if not more. With the financial pressures that always exist in the voluntary sector, it is difficult for it to comply with the red tape that business inevitably recruits people to deal with. It is important that the Government work closely with the sector to tackle the problems of red tape and to come up with innovative solutions that will allow the sector to deliver what it is best at delivering—front-line services—instead of spending time on administration.

A good example of that was cited in the briefing that was circulated to MSPs yesterday, relating to the cost of administering the existing water charges exemption. If it is costing the sector around £300,000 to administer an exemption that is worth £2.3 million, the balance is wrong. It should not cost the sector so much to administer a relatively small exemption. If we can get action on deregulation of the sector, that will be a positive move.

The sector brings most to delivery of services in Scotland where it is able to deliver different services in different areas, to be flexible and to be much more fleet of foot than many public sector organisations can be. We must be careful not to be overly prescriptive about how the sector should operate; it works best when it is given targets to achieve but is left to decide for itself how best it can deliver the services.

I have some sympathy with aspects of the Liberal Democrat amendment. It is essential that greater certainty be given over funding. We all know that the constant rounds of bidding and re-tendering are a drain on resources in the voluntary sector. We need to get better at allowing greater security and more time for the sector to deliver services. That relates to the important point about the need to reduce the burden of red tape. I therefore have sympathy with much that is in the Liberal Democrat amendment.

Today, Parliament has the opportunity to endorse what the voluntary sector is doing and to offer constructive suggestions about how it can be supported. The danger, I suspect, is that we will descend a little too much into day-to-day politics, although that is what we are here to do. It will be much better for the sector if we can rise above that and focus on how we can act constructively to help the sector to succeed.

I move amendment S3M-1706.2.1, to insert at end:

"and calls on the Scottish Government to work with the third sector to reduce the burden of regulation affecting the sector."

Robert Brown (Liberal Democrat, Glasgow)

Elaine Murray has chosen a highly topical and vital debate on the voluntary sector. We have had many debates on the voluntary sector in its many aspects. Most of those have been fairly consensual but have raised a number of long-term challenges—short-term, time-limited or matched funding; the divide in staff conditions between the voluntary sector and the public sector; how to entrench the sector's independence—all against the background of a recognition throughout Parliament of the huge value of the input that the sector provides.

Great strides were made by the previous Government in funding the national umbrella groups, enhancing their independence and introducing the voluntary sector compact and the compact with local government. I am proud of the work that we did in that context. However, apart from the welcome Government concession on extending the water rates exemption—an important concession—the debate is no longer consensual. Day by day, the SNP's actions, its unravelling "historic concordat" and its desire for quick fixes are causing more and more grief in the voluntary sector and are undoing much of the good work of the past eight years. Despite the evasions of the SNP amendment, the SNP Government cannot indefinitely avoid responsibility for the extra burdens that it is placing on the voluntary sector and the damaging service cuts for voluntary organisations that are flowing from its funding settlement.

It is manifest from the gobbledegook that we heard from the minister this morning that he is not comfortable with this area of policy. The central problem is that the SNP does not understand the sector in its various forms and has not taken the time to analyse the complex and myriad ways in which the sector engages with funders and with local authorities, in particular.

Richard Simpson (Labour, Mid Scotland and Fife)

Will Mr Brown acknowledge the comment that was made to me at a meeting last night by a representative of the voluntary sector, that it feels as though we have gone back to 1996. Does he agree that the minister has singularly failed to address the uncertainty among voluntary sector workers, many of whom have received redundancy notices and have only temporary funding?

Robert Brown (Liberal Democrat, Glasgow)

Yes, I acknowledge that. A notable casualty was Project Scotland, which has been mentioned on previous occasions. Its funding was slashed with no evidence to justify the cut. That has damaged opportunities for 16 to 25-year-olds and has made a mockery of the Government's pretensions to a proper skills strategy. The modest changes that were agreed by the cabinet secretary—after huge cross-party protests—are welcome, but they do not detract from the short-sighted nature of the original decision.

However, let me concentrate on the things that the SNP Government could do, even within its present policy envelope, to improve the lot of the voluntary sector. The Government could, as the sector has asked, consider a review of the system to guarantee more stable funding. It could build on the previous compacts and, in the light of the move to single outcome agreements, accept a thorough and independent review after a year of the concordat and its key outcomes. A national contract framework could provide a basis for parity with the wages and conditions of the public sector and for fair consideration for the sector in commissioning. The Government could also rein back on unnecessary and destabilising re-tendering procedures, which damage capacity and delivery and cost money for process rather than services.

Some 1,400 disadvantaged young people, for whom funding was previously provided centrally, will no longer have the support of the Prince's Trust because councils have failed to pick up the work. The Aberlour Child Care Trust and the Salvation Army are cutting services for drug addicts and the homeless. Addiction projects in Glasgow and Aberdeen are being rationalised. Day by day, challenges are developing in the sector.

The political argument will no doubt centre on the blame game as to where responsibility for those cuts lies. I suggest that it lies substantially at the door of the SNP Government, but a more important issue is whether the minister, in replying to the debate, will address the specific practical suggestions in the Liberal Democrat amendment for dramatically improving the framework. Those are particularly needed against the background of a tightened financial situation and a credit squeeze that is likely to hit charitable giving.

I move amendment S3M-1706.1, to insert at end:

"recognises the problems facing the voluntary sector caused by short-term funding and re-tendering; believes that there is a pressing need to review the system to provide more stable funding for the sector including longer-term contracts and a national contracts framework; notes the establishment of the voluntary sector compact under the last administration and calls for a revitalised compact between local government and the voluntary sector; believes that this compact must ensure greater dialogue between councils and voluntary groups as to the operation of the local government Concordat and the single outcome agreements, and calls for a review of the operation of the Concordat including its key outcomes and performance indicators following the first year of its implementation."

Rob Gibson (Scottish National Party, Highlands and Islands)

It is excellent to note that funding for the voluntary sector has been increased by 150 per cent by the SNP's budget. That provides the focus for this debate and is the reason why the SNP amendment talks about the reality in Scotland, while Labour is scaremongering by calling into question the competence of our councils and our Government, and their ability to co-operate with the voluntary sector. We argue that such co-operation is taking place and, for the first time, we are sitting down to consider the question of value. [ Interruption. ] If the Opposition would listen for a minute, we might be able to discuss how value should be looked at.

Robert Brown suggested that we need to value the voluntary sector. I suggest that we need to start to measure value a good deal more carefully. That is why the single outcome agreements that local authorities are currently drawing up are looking at the historical situation, given that many voluntary organisations have grown like Topsy. Someone needs to say, "We need to look at this to ensure that these organisations are doing a job for the community."

Margaret Curran (Labour, Glasgow Baillieston)

Will the member take an intervention?

Rob Gibson (Scottish National Party, Highlands and Islands)

No, I will not take an intervention. [ Interruption. ]

Alasdair Morgan (Scottish National Party, South of Scotland)

Order.

Rob Gibson (Scottish National Party, Highlands and Islands)

In respect of the circumstances in the local government area in which I live, I value the way in which the voluntary sector has been helped by the Government in various fashions. For example, a precedent has been created that allows some end-year flexibility so that small amounts of money can be carried over. That will allow the continuation of the work of the Ross-shire Waste Action Network. I value the fact that Highland Council is organising a forum for the voluntary sector to ensure that the value of what the sector does for vulnerable and disadvantaged people is measured carefully. It is high time that was done.

The Labour press release talks about people who are vulnerable and disadvantaged, but we have heard nothing about remoteness or the environmental disadvantage that many people in my area suffer. Our local authority is working with the voluntary sector to tackle that. Those are the kinds of issues on which we need to hear a good deal more. I am sorry to say that, this morning, we have heard only the usual tear-jerking stuff about vulnerable and disadvantaged people. Let us broaden out the definition and start to look at these things seriously. [Interruption.] Listen to Labour members. They are the kind of people who have presided over a poverty industry for the past eight years and long before that. What we are trying to do now, through our councils and so on, is ensure that we have an opportunity to take forward a rational debate about the issue. Take Highland Council's proposition. It says:

"We will develop a five year concordat with the voluntary sector in the Highlands governing the Council's £14 million investment."

That is the kind of work that is being taken forward under the SNP Government.

Richard Simpson (Labour, Mid Scotland and Fife)

Will the member take an intervention?

Alasdair Morgan (Scottish National Party, South of Scotland)

No, the member is winding up.

Rob Gibson (Scottish National Party, Highlands and Islands)

I am in my last minute.

In this debate, we need to recognise that, at long last, we have lifted the lid on how things were done in the past and we are seeing where the valuable parts are and where the dross is. We have to support the value.

Des McNulty (Labour, Clydebank and Milngavie)

How can I follow that?

I draw members' attention to my declaration of interests. I am a board member of the Wise Group, which is a major voluntary organisation in Scotland.

First, I seek clarification from the minister. In 2001, the then Transport and the Environment Committee recommended in a report that there should be a targeted water rates relief scheme covering hospices, churches, scout troops and other small voluntary organisations that maintain premises. Today, the minister has announced—if I may put it that way—that the Government is sympathetic to the extension of that scheme. Does he mean that the existing scheme will be maintained or that it will be augmented to cover a wider range of voluntary organisations? What has the minister actually decided? At that time, there was a considerable debate and the SNP had a position. What is the minister's position now? We are not clear about what the Government has decided. Voluntary sector organisations will want to know precisely what relief will be given, to whom it will be given and on what basis it will be available. The current situation is thoroughly unsatisfactory.

Of the two SNP speeches that we have heard, Jim Mather's can be summarised as being the emperor's new clothes. It is hard to summarise Rob Gibson's speech other than by commenting that hard-faced men are beginning to emerge in the SNP who believe that

"voluntary organisations have grown like Topsy"

and are far too generous in dealing with social need. That is absolutely not what the SNP said in Opposition. I think that there will be a lot of embarrassment among SNP people in Scotland when they listen to that.

Some important issues need to be addressed in the crisis in which the voluntary sector finds itself. As Richard Simpson rightly said, the crisis is exactly similar to the position during local government reorganisation in 1995-96, when voluntary sector organisations were left in a huge amount of financial uncertainty. At that time, I was involved in a group that was headed by Arnold Kemp and had been set up by the SCVO. In looking at the future of the voluntary sector, we argued strongly for three-year funding. Over the past seven or eight years, voluntary sector organisations have benefited from that continuity of funding and from the realistic expectation that resources would be rolled over. That predictability has allowed voluntary sector organisations to plan, to strategise and to provide greater continuity. They do not have that in the present situation.

In the concordat, there is a read-across from local government corporate plans into outcome agreements but there is not one word about voluntary sector organisations. Local government seems to be accepting its resources but not handing them on to the voluntary sector. That is the emperor's new clothes. That is what is happening in Aberdeen, West Dunbartonshire, Glasgow and throughout Scotland. Voluntary sector organisations do not know what money they will get so they are issuing redundancy notices. The people who will use their services do not know where those services will come from. That is a product of the Government's policy—a consistent, logical consequence of what the Government has chosen to do.

We need transitional funding for such organisations so that they can deal with that uncertainty—an uncertainty that is the Government's fault and a consequence of its actions. I hope to hear from the minister what he will do about it.

Gil Paterson (Scottish National Party, West of Scotland)

The Labour motion starts by stating

"That the Parliament applauds the vital contribution made to society and the economy by the voluntary sector".

I support that statement unreservedly and would go even further. As a board member of Central Scotland Rape Crisis and Sexual Abuse Centre, I can tell members that the volunteers' work cannot be matched pound for pound by public or private sector organisations.

Robert Brown (Liberal Democrat, Glasgow)

Will the member give way?

Gil Paterson (Scottish National Party, West of Scotland)

I am sorry. I do not intend to do so because I want to get a lot into my speech.

Give a voluntary organisation a pound and it can turn it into £10, but give a quango £10 and it will turn it into a pound.

It is clear that the Scottish Government recognises the contribution of the voluntary sector. At the concordat conference on Monday 14 April, John Swinney highlighted the key role for the third sector in effective community planning. The single outcome agreement structure will strengthen the role of the sector by recording officially its contribution as a key strategic delivery partner in each local authority area in Scotland and will give it valuable recognition for the first time in many areas. That recognition will open up a range of possibilities for the sector and statutory partners to look more creatively at resourcing themselves individually and collectively. Partnership bids that will maximise use of resources and move full-cost recovery from theory to tangible fact can be better pursued.

Support to voluntary organisations has been strengthened by the new funding round for councils for voluntary service, which exist to support and develop the third sector in each local authority area, of £11.85 million for 2008-11.

Active community engagement and volunteering are valuable personal development tools that are best delivered at a local level where the value of community activism can best be seen. The Scottish Government acknowledged that by supporting the volunteering partnership in Scotland, which consists of Volunteer Development Scotland—the national centre for excellence—and the network of 32 volunteer centres, one in each local authority area, which exist to grow and develop engagement and volunteering at local authority level. The partnership has just received a three-year funding package of £11.5 million for 2008-11.

Youth volunteering is a vital personal development tool that the Scottish Government has committed to supporting through the millennium volunteer certificate scheme which is run through volunteer centres and funding for YouthLink Scotland. However, with an ageing population, the contribution of volunteering schemes, such as those that are run by community service volunteers, is also important. Support has also been given through the voluntary action fund's volunteering grant schemes.

I turn to the scaremongering that is implicit in the Labour motion. It is clear that Labour hopes and prays that the third sector will run into trouble. The continual and perpetual false claims that councillors will withdraw funding are shameful.

Let me just conclude, Deputy Presiding Officer.

Alasdair Morgan (Scottish National Party, South of Scotland)

You must conclude now, Mr Paterson.

Gil Paterson (Scottish National Party, West of Scotland)

I trust implicitly the SNP councillors. I even trust the Labour councillors. It is just a pity that their leadership does not.

George (Labour, Lothians)

SNP spokesmen ought to stop pretending. We have had a tartan Tory budget, supported by the real Tories, with real tax cuts; the SNP has to accept the consequences.

Some of my colleagues might be wondering why, given all the statements about the voluntary sector that we had from the SNP in opposition, it is putting itself through this. I will let members into a secret. In a rare moment of candour, Sir George Mathewson said to me that he, Souter and Farmer had given up on the discredited Scottish Tories ever getting Labour out of power in Scotland so they all put their money, resources and support into the SNP. Of course, that succeeded. Now, however, it is payback time. There will be no re-regulation of the buses, because Mr Souter would not like that, and we have had the tartan Tory budget.

Gavin Brown (Conservative, Lothians)

Will the member give way?

George (Labour, Lothians)

No.

The SNP has to accept the consequences, which are job losses and service cuts, and it must stop pretending that they are not happening.

Such losses and cuts might be acceptable for right wingers such as Jim Mather and Rob Gibson, but what about those with left-wing credentials? Where are Alex Neil and republican Rose today? Their seats are empty—they are skulking away in some corner because they realise what is going on.

Labour introduced ring fencing because real Tory councils—we had them in Scotland at one time—would not spend money on the vulnerable and the old. Colleagues will remember that Tory councils cut rates all the time. We brought in ring fencing to protect the vulnerable, old and disabled, but that protection has been lifted by the concordat. Pat Watters ought to be ashamed of himself for agreeing to that concordat, as any Labour spokesman ought to be.

Now councils have tight budgets and chief officials are asked to find savings, but they are not going to say, "Okay, I'll retire," or, "My deputy and top officials will go." No—it is the home helps and nursery nurses in council services who will go. Above all, it is the voluntary organisations—the outside bodies that councils do not worry about—that will go. That is happening now. Somewhat belatedly, Martin Sime of the Scottish Council for Voluntary Organisations has begun to realise that lifting that protection has consequences for voluntary organisations.

The SNP still says that we are scaremongering, but cuts and losses are happening on the ground. Why are thousands of people marching in Aberdeen? I offer a few examples from Edinburgh. The Edinburgh Cyrenians, which supports the homeless, has suffered a £30,000 cut, and the Gorgie Dalry Partnership, which does innovative work in one of the poorest areas of the city, is closing down because of the cuts. We keep hearing from the SNP about asylum seekers, but the Scottish Refugee Council is closing down some of its services because of the SNP cuts. Across Edinburgh, 30 organisations have suffered a 75 per cent loss in funding. That is not scaremongering; that is really happening. That is the reality of the SNP in power, and the party ought to be thoroughly ashamed of itself.

Brian Adam (Scottish National Party, Aberdeen North)

George Foulkes has given us a very interesting speech and an interesting insight into what is really happening in the Labour Party. He has long experience as a councillor, a member of the House of Commons and now as a member here, so I am surprised that he ignores the fact that there are changes in council budgets every year and that, every year, those changes affect the voluntary sector.

Rhona Brankin (Labour, Midlothian)

Will the member give way?

Brian Adam (Scottish National Party, Aberdeen North)

I ask the member to let me develop my point.

I do not believe that George Foulkes's description of what is happening this year, in comparison with what happened in previous years, was as full as it might have been. The reality is that there are changes every year. Substantial amounts of money go to the voluntary sector through arrangements such as lottery funding, and projects have to move on when that funding ends. Lots of funding streams end.

One of the interesting things that has happened with the lottery funding stream for the voluntary sector is that Mr Foulkes and his colleagues in the House of Commons agreed to take £184 million of funding that would have come to Scotland. As a direct result, there will be cuts in the voluntary sector here. Those cuts will be much more substantial than those that result from some of the natural changes that happen year in, year out throughout Scotland, no matter which parties are in power in either central or local government.

Des McNulty (Labour, Clydebank and Milngavie)

Will the member give way?

Brian Adam (Scottish National Party, Aberdeen North)

No.

The fact is that judgments are always made on the value that is given.

I welcome the fact that, despite the real difficulties faced in Aberdeen as a result of the mismanagement of council budgets, the aye can facility has this week been saved through the efforts of the council, the Government's social enterprise policies and Sir Ian Wood's family trust. I hope that such a model will be rolled out across Scotland—

Lewis Macdonald (Labour, Aberdeen Central)

Will the member give way?

Brian Adam (Scottish National Party, Aberdeen North)

No.

I hope that that model, which encourages the widest possible participation in delivering services, will be rolled out.

Robert Brown (Liberal Democrat, Glasgow)

Will the member give way?

Brian Adam (Scottish National Party, Aberdeen North)

I want to develop this point a little more.

I have to say that I do not recall the Labour members who have told us this morning how bad the current changes are thinking that the closure of the Airborne Initiative was such a bad idea.

Rhona Brankin (Labour, Midlothian)

Will the member take an intervention?

Brian Adam (Scottish National Party, Aberdeen North)

I will take no interventions from the Labour Party.

Robert Brown was absolutely right to say that too much of the voluntary sector's effort is focused on process. Many groups have to devote a substantial amount of time and energy to applying for and raising funds and having that activity monitored. It is a good idea to reduce such red tape and increase security, but it is patently absurd to suggest that the removal of ring fencing will sound the death knell of the voluntary sector in Scotland. There will be changes, some of which might well be painful, but that is what happens, no matter whether we are talking about the voluntary sector, the public sector or the private sector.

I am delighted to support the Government's amendment.

David Stewart (Labour, Highlands and Islands)

I refer members to my entry in the register of members' interests.

A century and more before the national health service was a mere twinkle in Nye Bevan's eye, hospital almoners cared for the sick, comforted the bereaved and counselled the dispossessed. That work was not done out of a sense of paternalism or pity; instead, it was a matter of professionalism and commitment, and the ethos followed by those early almoners remains apt for the dynamic and diverse third sector, which in my area covers a range of organisations from the Highland Hospice to the Highland Community Care Forum.

Like many members, I have worked in the voluntary sector. I have been a volunteer with the Samaritans and Citizens Advice Scotland; I have been an unpaid director with Highland Homeless Trust; and I have been employed by the umbrella organisation of the sector, the SCVO. I have campaigned and organised on the front line of the sector and have seen at first hand the quality of work being carried out in various areas, from rural development to the provision of autism services.

The sector's very scale should act as a wake-up call to commentators who accuse Scots of being a nation of couch potatoes. Scotland has 1.2 million volunteers, 45,000 organisations with a formal set of rules and 18,000 regulated charities, and the sector has nearly 130,000 paid staff—or about 5 per cent of the Scottish workforce. The sector's income represents 4 per cent of the country's gross domestic product.

As we all know, the third sector is part of civic society and encompasses churches, faith groups, trade unions and professional associations. Indeed, it played a key role in the constitutional convention, which framed the ideas and principles behind the Parliament.

I give credit to the previous Administration for recognising the sector's contribution and value. As members have already pointed out, it introduced a number of initiatives such as the Scottish voluntary sector compact, the review of direct funding, the strategic funding review and Social Investment Scotland, which was set up in 2001 to build capacity through loan finance. Full cost recovery and three-year funding contracts are also very important for the sector.

To be fair—as I always am, Presiding Officer—the current Administration seemed to be very positive about the sector when it took office almost a year ago. However, the reality is different on the ground. For example, as we have already heard, the SNP-controlled Highland Council has cut £86,000 from Age Concern Scotland, which now has to find the money from its own resources. The funding for Aberdeen Cyrenians has been cut by £900,000 and, in Edinburgh, the Ark's funding has been cut by £74,000.

In Highland, we will soon see a huge cut in funding for those who look after our elderly people's needs. These organisations are not, as Rob Gibson has suggested, growing like Topsy; they exist to meet the needs of the vulnerable in our communities. Although the excellent and well-respected Highland Community Care Forum might have had a stay of execution, many are worried about its future. Moreover, every voluntary and youth sports organisation in Highland faces a real-terms cut as a result of the £50,000 saving that the education department is seeking to make in its budget.

On top of all that, the Highland Council is about to embark on a major revision of charges for accessing the school buildings that are used extensively by the voluntary sector. Organisations face being squeezed not only by cuts and savings but by increased charges. Is the third sector being squeezed out by the concordat? Moreover, what will be the effect on users of mental health, disability and vulnerable elderly services? We must stand up for the voluntary sector, and I urge members to support my friend Elaine Murray's motion.

Iain Smith (Liberal Democrat, North East Fife)

Derek Brownlee was wrong to say that this debate would be constructive. Instead, we have seen speaker after speaker for the SNP squirming around, trying to change their party's position. A year ago, they called every cut in funding to local voluntary services an absolute disgrace and blamed the Government for letting them happen; now they are saying that such cuts are natural and that they are simply what happens. Frankly, Rob Gibson should be ashamed of his speech, as should those who applauded it.

The minister and SNP members need a reality check. Real cuts are being made to the voluntary sector in our communities, and they are the direct result of the Government's decision to freeze the council tax and limit the money available to local government. That is the reality; if no one believes me, perhaps they will believe the SCVO briefing, which states that

"Current problems with Third Sector Funding"

relate to the local government funding settlement and

"Specific funding decisions taken by Local Authorities".

Members have highlighted the voluntary sector's major contribution to our economy, but we should also remember that we rely on it to provide key drug and alcohol services; services to offenders to prevent reoffending; pre-school and child care services in many of our deprived communities; and welfare advice and debt counselling services to help the poorest in our society deal with their many problems, particularly in the current economic situation. People with mental health problems rely on the voluntary sector to provide counselling and advocacy services, and the sector also provides support to the deaf and blind communities and many other people with disabilities. Moreover, those with long-term illnesses rely on the sector for specialist services to support them in their daily life. The sector provides vital services to some of the neediest in our community, and this Government is simply not respecting it.

The sector faces serious problems, some of which are long term. I do not claim that the previous Administration got everything right, and changes need to be made. We need, for example, to deal with the problem of short-term funding and constantly changing funding streams. The nature of project-based funding means that the sector has to change its approach every so often to meet different funding needs; and fulfilling the audit and performance management requirements of different funders requires a huge amount of form filling. Indeed, two different council departments that fund the same organisation might have completely different audit and performance management trails. That situation is simply unnecessary, and I agree to an extent with Derek Brownlee that we need to deal with such bureaucracy.

As we have seen in local government, when savings are required, the voluntary sector is always the first to be hit. That is why so many senior staff in the voluntary sector spend so much time filling in forms and chasing funding instead of supporting and developing the services that their organisations provide. We need to change that situation and provide proper security and support for long-term core funding, not just project-based funding, for those organisations. I am not saying that every voluntary organisation deserves to be funded ad infinitum; they have to show that they are providing a necessary service. However, they need security to develop their services and provide them in the long term.

I am pleased that the Government has hinted that it will continue to extend the water rates relief scheme. However, the treasurers in the village halls and church halls in our communities want the minister to do more to address the uncertainties and worries. They want a clear commitment from him that the exemption will continue; they do not want hints. I hope that he can give such a commitment in his closing speech.

I hope that members will support the Liberal Democrat amendment. SCVO said in its briefing, which arrived late this morning:

"The Lib-Dem amendment focuses on the need for more stable funding for voluntary organisations and a clearer relationship between Scotland's 32 local authorities and the voluntary sector. The problems of short-term and unstable funding mean that some of the most vulnerable people in society who rely on the voluntary sector do not always get the services they deserve due to high staff turn-over and inability on the part of charities to forward plan effectively."

I could not agree more. The briefing continues:

"SCVO strongly supports this amendment."

The Parliament should do so too.

Gavin Brown (Conservative, Lothians)

Overall, the debate felt a little rushed. The voluntary sector, which makes a massive contribution to society in Scotland, would probably benefit from a longer, deeper, more informed debate. All parties probably agree on that.

Margaret Curran (Labour, Glasgow Baillieston)

Will the member give way?

Gavin Brown (Conservative, Lothians)

Not just now.

It is easy to say that the sector makes a vital contribution, but it is worth reiterating the sheer size of the sector and the figures that Elaine Murray used at the start of her thoughtful speech. The voluntary sector in Scotland is worth well over £2 billion and comprises more than 50,000 organisations, which employ more than 130,000 people and have well over a million volunteers. To say that the sector makes a vital contribution is almost to do it a disservice; it is critical to the future of service delivery in Scotland.

I will pick up on a couple of important points that have been made. Derek Brownlee talked about the burden of red tape that the third sector bears, which is the subject of the amendment in his name. It is important that we invest time and energy in resolving the problem. He said, quite correctly, that the third sector should focus heavily on the delivery of front-line services and should not have to spend time in the back room worrying about administration. It is important that we secure a commitment on that. I have no simple solution, but I think that all voluntary organisations and their workers would appreciate it if something akin to the regulatory review group, which considers business regulation, could consider the third sector.

We strongly welcome the commitment on water service charges that is in the amendment in Jim Mather's name and was reiterated by Mr Mather in his speech. A number of parties and organisations have campaigned on the issue for a long time and the Scottish Conservatives have been heavily involved in the campaign. We have lodged motions and tried to bring communities together. It is good news for everybody that the exemption will be taken forward. It is right that the exemption for churches, village halls and smaller voluntary organisations should continue beyond 2010.

We probably differ slightly from the Labour Party in our thinking on where the blame lies for shortfalls that might be experienced. In broad terms, we welcome the reduction in ring fencing. It is right that local councils should make decisions about what happens locally. It is worth pointing out that, as Brian Adam said, considerably more than £100 million that could have come to Scotland via the lottery has ended up being directed to the London Olympics. Surely even the Labour Party must accept that that is a factor in the reduction in funding to certain voluntary organisations.

Elaine Murray (Labour, Dumfries)

Will the member give way?

Robert Brown (Liberal Democrat, Glasgow)

Will the member give way?

Gavin Brown (Conservative, Lothians)

I will take an intervention from Elaine Murray, because she stood up first.

Elaine Murray (Labour, Dumfries)

The draft Payments into the Olympic Lottery Distribution Fund etc Order 2007 was approved on 15 January by 357 votes to 9, so the vast majority of Conservative members of Parliament voted for it.

Gavin Brown (Conservative, Lothians)

As well as the vast majority of Labour MPs.

I point out to Elaine Murray and the rest of the Labour Party, who blame the local government settlement, that there were two occasions on which they could have opposed the settlement, but every Labour MSP in the chamber voted in favour on both occasions. I point out to George Foulkes, who had a go at the budget, that only one Labour MSP had the courage to vote against the budget, so it is trite—

Rhona Brankin (Labour, Midlothian)

Will the member give way?

Alasdair Morgan (Scottish National Party, South of Scotland)

The member is in his final minute.

Gavin Brown (Conservative, Lothians)

I am in my final 20 seconds.

As Derek Brownlee said, we want greater independence and autonomy for the third sector. It is critical that there should be a debate about longer-term funding, particularly for proven models of success.

Stewart Maxwell (Scottish National Party, West of Scotland)

I am pleased by the strong support for and commitment to the third sector that has been expressed by members of all parties. At least we can agree on that—[ Interruption. ] Sorry, I was wrong—the Labour Party disagrees.

My colleague, the Minister for Enterprise, Energy and Tourism, strongly expressed the Scottish Government's belief in the transformational potential of the sector. Perhaps more important, he set out our approach to ensure that that potential is realised. There is no doubt that the sector faces challenges—this is a new environment for the sector, too. However, the key is for people to recognise the opportunities that our focus on localism is providing and for the Government to support the sector to take those opportunities.

We have increased our investment in the national network of councils for voluntary service and the volunteer centres. That funding is specifically intended to support the sector to have access to the new opportunities and to enable it to support the people and organisations that rely on it.

We also made clear that we will work to support a new and stronger framework to enable the third sector to engage with local structures, including councils and community planning partnerships. Of course, that works both ways: we will also support local authorities and others to connect with the sector, to work smarter with it and to enable greater access to procurement processes in relation to service delivery and design.

Margaret Curran (Labour, Glasgow Baillieston)

I am not sure whether I followed the minister correctly. He will be aware that the voluntary sector has made strong representation about its exclusion from negotiations about the single outcome agreements. Is he now saying that the sector should be part of those negotiations?

Stewart Maxwell (Scottish National Party, West of Scotland)

I am saying that we will work with all sectors to ensure that work is taken forward. Of course, there is a working group, which includes the voluntary sector as well as officials, the Convention of Scottish Local Authorities, the Society of Local Authority Chief Executives and Senior Managers, as well as SCVO—

Johann Lamont (Labour, Glasgow Pollok)

The voluntary sector is not included—

Stewart Maxwell (Scottish National Party, West of Scotland)

SCVO is part of the sector. That monitoring group is considering single outcome agreements and is contributing to the progress that we are making in that regard. It is part of the process.

We have discussed the record funding and financial support that we are providing. The water charge exemption is part of that. We know how vital it is to small third-sector organisations to be able to support their communities and causes. We have also made clear our intention to introduce a Scottish investment fund, which will build the capacity and sustainability of individual third-sector organisations, thereby contributing to a more successful Scotland.

However, the issue is more than just money; there are real opportunities to grow the sector, which will bring benefits to the sector, its clients, local authorities and Scotland's economy. Volunteering has a role to play and we have outlined our support for volunteering and the funding that backs that up. We acknowledge the wide benefits of volunteering, which builds skills and confidence and provides volunteers with the satisfaction of knowing that they are making a contribution for the individual that has knock-on benefits for us all. Our support to our national networks, in particular the £11.5 million for the volunteer centres, will help to ensure that there are opportunities to volunteer for as many people as possible, across all age ranges.

Elaine Murray and other members talked about the necessity for three-year funding. A three-year settlement is provided to local authorities and it is perfectly reasonable for local authorities to negotiate with local voluntary organisations in the same manner. It is open to local authorities to do that and nothing prevents them from doing so. It is a bit rich of Labour members to talk about delays in funding. The reason why the process this year has been so delayed is the Treasury's delay in allocating the block grant to the Scottish Government. The delay was caused by the Labour Party in London and Labour members cannot escape from that and the problem that it caused this Government.

Derek Brownlee made good points about the need to strike the right balance on regulation. I absolutely agree that there must be proper regulation but not overregulation.

Alasdair Morgan (Scottish National Party, South of Scotland)

You have one minute left.

Stewart Maxwell (Scottish National Party, West of Scotland)

I fear that the call to rise above day-to-day matters and consider strategic issues has failed. Robert Brown's speech seemed to be fundamentally about scaremongering. He cried wolf again and again, as did many members on the Labour benches. It is nonsense to talk in the way that many members have done—Rob Gibson made an excellent speech, slaying some of the issues that were raised.

For the record and in case members missed it, George Foulkes said—I think I quote him correctly—that Pat Watters

"ought to be ashamed of himself".

I think that that comment will come back to bite not only George Foulkes but the Labour Party.

George Foulkes also mentioned Martin Sime, who said this week—

Alasdair Morgan (Scottish National Party, South of Scotland)

I am afraid that you must finish now, minister.

Stewart Maxwell (Scottish National Party, West of Scotland)

Martin Sime said that the removal of ring fencing, which controlled how money was spent, is a development that he can support, is a good idea and is good for local democracy—

Alasdair Morgan (Scottish National Party, South of Scotland)

I am sorry. I must call Margaret Curran.

Margaret Curran (Labour, Glasgow Baillieston)

It has been some debate—I have written in my notes that it has been interesting and challenging. We heard what I consider to be an excellent speech from Robert Brown, who gave a tight analysis of developments in the voluntary sector, as did Elaine Murray. I also pay tribute to Rob Gibson, who did the Parliament a service by letting the cat out of the bag and telling us exactly what the SNP is about. I am sure that the minister will come to regret his endorsement of that speech. Rob Gibson told us exactly what the SNP agenda is on the voluntary sector—it is about tackling the "poverty industry". Perhaps he could define that and say which bits of the sector he wants to get rid of. He said that the sector has been growing like Topsy, that that needs to be addressed and that elements of the voluntary sector are "dross". Now we know exactly what the SNP thinks.

Rob Gibson (Scottish National Party, Highlands and Islands)

rose—

Stewart Maxwell (Scottish National Party, West of Scotland)

rose—

Margaret Curran (Labour, Glasgow Baillieston)

Sit down.

The central charge is that Stewart Maxwell, a minister of the Government, dismissed as scaremongering the litany of cuts that we have brought to the Parliament today. On one level, I am flattered by that. He clearly must think that the Labour Party is extraordinarily powerful if he thinks that we could organise all the organisations in Scotland that have concerns to operate at our behest. I did not expect SNP ministers to get so stuck in their cars and offices that they have become disconnected from the real experience of what is happening in Scotland—shame on you, as the voluntary sector minister.

Rhona Brankin (Labour, Midlothian)

Does the member agree that the cuts of more than £1.1 million in funding to Quarriers will affect children with disabilities, vulnerable families and adults with learning disabilities? Does she agree that it is an absolute disgrace that those cuts have come in the past year alone?

Margaret Curran (Labour, Glasgow Baillieston)

Absolutely—and who knows what the future will bring? That is the hallmark of the SNP Administration, now that we are approaching one year into its time in office. Funding is under threat, services are being lost and there are cuts and uncertainty. That sorry situation is undermining the good work of previous Administrations on the voluntary sector—work that you supported when you were in opposition. As has been said, that work delivered a step change in Government support to the voluntary sector, with a strategic review of funding and three-year funding cycles. I challenge you, minister—I will give way to you on this—to say whether you expect local authorities to give three-year funding to the voluntary sector.

Stewart Maxwell (Scottish National Party, West of Scotland)

I said clearly that we provide a three-year funding proposal.

Richard Simpson (Labour, Mid Scotland and Fife)

They cannot.

Stewart Maxwell (Scottish National Party, West of Scotland)

They can. We believe in local authorities and their right to determine what is important locally—that is the difference between Margaret Curran and me.

Alasdair Morgan (Scottish National Party, South of Scotland)

Minister, that is long enough.

Margaret Curran, can we avoid the second person, please?

Margaret Curran (Labour, Glasgow Baillieston)

I apologise, Presiding Officer—I will do my very best not to use it again.

The previous Administration delivered the historic compact, sustained investment and a framework for volunteering. That work enabled the voluntary sector to innovate and create and to change and deliver, but there is now a real danger that that work is being undermined. Despite the denials that we hear from the SNP, there is a litany of concerns throughout Scotland about cuts and uncertainty. Despite the minister's words, the volunteering sector would tell him that there is a lack of any strategic investment policy. The sector is getting much less funding than it anticipated.

I could spend the rest of my speech talking about voluntary organisation after voluntary organisation that has had funding cuts and is deeply worried. Worst of all in what we have heard today is the Government's refusal to take responsibility for its actions. What is happening in Scotland—ministers can hide in their offices, but it is happening—is not an act of God, but a direct result of ministers' budget decisions. Labour's charge against the SNP is serious and profound. The SNP provided a reduced settlement for local government. Christine Grahame, who is normally around for such debates, has said:

"When local authorities have to find savings, the first thing that they cut is their voluntary sector contributions."—[Official Report, 3 May 2006; c 25204.]

Is that still the SNP's view?

Another issue that is just as important and which the minister did not clarify is that there is now no place at the table for the voluntary sector. We empowered the voluntary sector, but the SNP is reducing its influence. After the SNP's first year in office, we are beginning to see the reality rather than the rhetoric. There is a lack of vital services, from child care to support for homeless people, and from services for people with learning disabilities to health charities and mental health organisations—and we are told that we are scaremongering. The SNP has upset the balance between Government and the voluntary sector, with the sector losing resource and influence.

The SNP has addressed the water rates issue and has partially addressed the issues to do with ProjectScotland. However, I hope that the SNP will provide transitional funding to support our vital services and organisations. I am disappointed that the SNP has not done that already. Just for once, can we have grown-up politics from the SNP? The SNP should face the consequences of its actions, take responsibility for its decisions and recognise the scale and depth of what it has done.

I say to Jim Mather that the concern about those in need that drives Labour members is not about micromanaging; it is about standing up for Scotland. Economic growth and social justice must go hand in hand—that will make Scotland grow. The SNP's cuts illustrate its betrayal of that profound aspiration. It is time to take action now. We have seen a shameful display from the SNP today.

Question Time — Scottish Executive — General Questions

Hugh Henry (Labour, Paisley South)

To ask the Scottish Executive how many of the teachers who finished their probationary year in June 2007 have failed to find a job in teaching during the current academic year. (S3O-2933)

Maureen Watt (Scottish National Party, North East Scotland)

The General Teaching Council for Scotland's survey of post-probation teachers in October 2007 showed that 87.8 per cent of respondents had gained employment as a teacher. The GTC will carry out a further survey next month, which will show the position closer to the end of the school year.

Hugh Henry (Labour, Paisley South)

It is profoundly worrying that you seem to take comfort from the figure of 87.8 per cent, because it includes those who are on temporary or short-term contracts and who have failed to get a permanent job, which means that 20 per cent of those teachers have still to get a job. Renfrewshire Council is cutting at least 55 to 60 secondary teaching jobs, which will make it more difficult for new teachers to obtain employment. Minister, do you have any concerns about what Renfrewshire Council is doing?

Alex Fergusson (None, Galloway and Upper Nithsdale)

Before the minister speaks, I remind members that the word "you" should be applied only to me. I really have to say that too often.

Maureen Watt (Scottish National Party, North East Scotland)

I will answer the second part of the member's question first. Renfrewshire Council has allocated £1 million for class-size reduction in early years and £0.5 million to increase the hours of nursery education for every three to four-year-old. That is not counting the efficiency savings that the council can recoup and reinvest, which it could not do in the past.

We knew that there would be a problem—inherited from the previous Executive—with the employment rate among post-probation teachers this year, which is why we took early action to provide an additional £9 million to local authorities so that they could employ the equivalent of 245 full-time teachers. The situation would have been much worse if the Government had not acted.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Does the Scottish Executive agree that one way in which to avoid the problem arising in future would be to set up a formal forum in which all the local authority education departments can meet the GTC for Scotland on a regular basis? That would bring together the two bodies that know best what teachers are required and what skills are available.

Maureen Watt (Scottish National Party, North East Scotland)

That is precisely what we believe and know that we will be able to achieve with the concordat and the single outcome agreements that we have with local authorities. It will now be much easier to have a better knowledge of local authorities' requirements for teacher employment.

Sandra White (Scottish National Party, Glasgow)

To ask the Scottish Government what issues will be discussed at the next joint ministerial committee. (S3O-2883)

Linda Fabiani (Scottish National Party, Central Scotland)

The First Minister is currently in discussion with the United Kingdom Government and the other devolved Administrations about what issues should be discussed at the joint ministerial committee. Of course, at this stage the main priority for us is to ensure its successful reinstatement, so that we can build on the good work that the Government has carried out in the joint ministerial committee on Europe.

Sandra White (Scottish National Party, Glasgow)

The minister will be aware that the Glasgow passport office—Scotland's only passport office—is to be run down, which will lead to the loss of more than 100 jobs. The same fate may befall the offices in Northern Ireland and Wales, leaving all the devolved Administrations without full passport services. Does the minister agree that that would be totally unacceptable? Will she consider raising the matter at the next JMC meeting?

Linda Fabiani (Scottish National Party, Central Scotland)

There is great concern throughout Scotland about what is happening at the passport office, and I am glad that our colleagues at Westminster are raising the issue directly.

At the JMC, there are many issues that can be discussed to the benefit of Scotland, which is what this Government is always most concerned about. The First Minister will give consideration to which items he will request should be examined at the first plenary session of the JMC.

Jeremy Purvis (Liberal Democrat, Tweeddale, Ettrick and Lauderdale)

Alongside the JMC, in the relationship between the devolved Administrations and the United Kingdom Government, are the concordats. Before last summer, the Scottish Government announced its review of the concordats. Has that review been concluded, and will it be published?

Linda Fabiani (Scottish National Party, Central Scotland)

Discussions with the UK Government are, of course, on-going. However, the most important thing just now is to get the JMC set up properly. After all, it will be the first JMC plenary meeting since 2002. Our desire to get the JMC set up shows the importance that this Government places on looking after the interests of Scotland.

Brian Adam (Scottish National Party, Aberdeen North)

To ask the Scottish Executive whether it has any plans to monitor the provision of alternative and augmentative communication aids by individual health authorities. (S3O-2859)

Shona Robison (Scottish National Party, Dundee East)

It is for national health service boards to provide alternative and augmentative communication aids that best meet the needs of their local populations, in partnership with education services, social services and other service providers, as necessary.

Brian Adam (Scottish National Party, Aberdeen North)

Does the minister agree that the current provision is rather patchy, and that the significant improvements in those aids have meant that their provision to stroke victims, for example, can result in much better outcomes?

Will the minister consider monitoring the issue to ensure that we do not have a postcode lottery as far as this matter is concerned?

Shona Robison (Scottish National Party, Dundee East)

I am aware of the concerns that Brian Adam raises. I have agreed to meet the alternative and augmentative communication services campaign group on 12 May to discuss its concerns, including those raised by the member, and to examine what steps can be taken to improve the services.

Patricia Ferguson (Labour, Glasgow Maryhill)

To ask the Scottish Executive what savings have been accrued from the merger of the seven previously available funds into the fairer Scotland fund. (S3O-2926)

Stewart Maxwell (Scottish National Party, West of Scotland)

The fairer Scotland fund is allocated to and managed by community planning partnerships. By replacing seven individual funding streams, each with its own separate administrative arrangements, the introduction of the fairer Scotland fund should generate real benefits for local authorities and their partners through reduced bureaucracy and more streamlined monitoring and reporting requirements. However, it is for each individual partnership to estimate and manage any resultant savings.

Patricia Ferguson (Labour, Glasgow Maryhill)

The minister has said that efficiency savings will accrue as a result of the change. Is he concerned, as I am, that uncertainty is arising as a result of the merger? People are on redundancy notice; they may or may not be made redundant. Funding streams have not yet flowed through to the very organisations that need them most. Will the minister consider the merger carefully and review it? Will he also consider the request that I made to him previously—to give regard to the special circumstances of Glasgow, in the same way as the Executive has hinted that it will give regard to Edinburgh? Will he consider setting up a separate fund to address Glasgow's particular needs?

Stewart Maxwell (Scottish National Party, West of Scotland)

The only uncertainty in this area is caused by the continual scaremongering of Labour members. We have had a whole morning of it, and now we are having it yet again during question time. It is reprehensible and irresponsible to continue this kind of scaremongering, with its tactic of crying wolf. The fairer Scotland fund was called for by the Finance Committee. At the time, that committee was convened by Des McNulty, and I am sure that other Labour members on the committee supported the establishment of a single deprivation fund. We have brought it about and that has been very much welcomed.

Glasgow City Council receives a substantial share of the money and, because of particular problems in the Glasgow area, Glasgow will receive £154.5 million from the fairer Scotland fund over the next three years to tackle poverty and deprivation and to help more people to access sustainable employment opportunities.

Dave Thompson (Scottish National Party, Highlands and Islands)

Does the minister agree that the fairer Scotland fund provides a simpler and more effective method of distributing funds to local communities? What has been done to improve public awareness of the fairer Scotland fund and access to it?

Stewart Maxwell (Scottish National Party, West of Scotland)

The fairer Scotland fund is intended to be a streamlined and simplified system for allocating funds. It was called for by a committee in the previous session of Parliament, and it was called for by this Parliament. Now that we have implemented the fund, it is a bit rich of members of Opposition parties suddenly to condemn the very thing that they called for when they were members of particular committees.

Individual community planning partnerships are responsible for administering the fairer Scotland fund. They should ensure that all the organisations in their area are aware of the fund and of the application process. Applying to a single funding stream is a big improvement on the previous system, under which people had to apply to up to seven different funding streams.

Alasdair Morgan (Scottish National Party, South of Scotland)

To ask the Scottish Government what discussions it has had with Her Majesty's Government regarding ITV's proposals for news broadcasting in the Border Television area. (S3O-2858)

Linda Fabiani (Scottish National Party, Central Scotland)

The Scottish Government has not raised the matter with the United Kingdom Government, because it is primarily a matter for the Office of Communications, the communications regulator. My officials are in regular discussion with Ofcom on this and many other matters.

Alasdair Morgan (Scottish National Party, South of Scotland)

Does the minister agree that ITV's proposals represent a huge diminution in the amount of local news and current affairs coverage available in the south of Scotland?

Does the minister also agree that given that new technology allows news coverage to be much more flexible, responsive and local, the public will be astonished and angry that news coverage for the south of Scotland will, in effect, be centralised in Newcastle? Would it not be much better if broadcasting was controlled by the Scottish Government?

Linda Fabiani (Scottish National Party, Central Scotland)

I understand that for some, in particular those who live closer to Edinburgh than Carlisle, the service of Border Television is distant. It may be that Border Television can develop services that meet needs across its region. I am happy to await the report of the Scottish Broadcasting Commission for advice on this issue. Likewise, we will consider how to respond to Ofcom's consultation review as and when appropriate and taking into consideration the work of the Broadcasting Commission.

Alex Neil (Scottish National Party, Central Scotland)

To ask the Scottish Executive whether it is satisfied with the performance of Historic Scotland. (S3O-2878)

Linda Fabiani (Scottish National Party, Central Scotland)

I understand that Historic Scotland expects to meet all 10 of the key performance targets set for it by the Government for 2007-08.

Alex Neil (Scottish National Party, Central Scotland)

I draw the minister's attention to the Rowallan development in an unemployment blackspot in East Ayrshire, where Historic Scotland has done severe damage to the fabric of the old castle but is still holding up £60 million of development. It has employed what can only be called heavy-boot tactics in dealing with the developer. Will the minister try to resolve the situation, and will she introduce a policy for the disposal of properties in care?

Linda Fabiani (Scottish National Party, Central Scotland)

As Mr Neil knows, the case is currently the subject of a public inquiry. Therefore, I am constrained in responding to the particular issues. However, I will make a general point. In the period from 2005 to 2008, Historic Scotland received 798 applications for scheduled monument consent and approved all but one of those applications. Therefore, it approved almost 100 per cent of such applications.

Ted Brocklebank (Conservative, Mid Scotland and Fife)

Is the minister aware of the ludicrous situation at Crail airfield in Fife? The airfield was scheduled as a national monument by Historic Scotland more than a decade ago. Is she aware that, because of its listing, this ramshackle collection of huts, which never saw a shot fired in anger, has continued to disintegrate while the local farmer has, in effect, been prevented from developing or farming his land? Will the minister undertake to meet Historic Scotland to bring about an early resolution, so that the farmer can take control of his land while preserving the most significant parts of the airfield?

Linda Fabiani (Scottish National Party, Central Scotland)

One thing that I learned very quickly as a minister was that I can always rely on Mr Ted Brocklebank to come up with something that is not in my briefing notes. I am more than happy to admit to having no idea about the particulars of that case, and I will ensure that it is discussed in detail at my next scheduled meeting with the chief executive of Historic Scotland.

Pauline McNeill (Labour, Glasgow Kelvin)

I declare an interest as a member of GMB.

To ask the Scottish Executive whether it will consider compiling annual statistics on the incidence of offences committed against workers in the cash and valuables in transit industry. (S3O-2945)

Kenny MacAskill (Scottish National Party, Edinburgh East and Musselburgh)

Offences of that nature are very serious, often involving organised criminals who have no hesitation about using violence. Although the matter is one of operational policing, the Government has a part to play. That is why we recently announced a three-year funding package of £778,000 for the Scottish Business Crime Centre.

The centre provides practical advice to the business and commercial sectors on how to prevent and deter business crime, and it is responsible for the Scottish financial crime group, which monitors offences against cash and valuables in transit workers through the British Security Industry Association. It therefore seems to be neither efficient nor sensible for the Scottish Government to gather the same information.

Pauline McNeill (Labour, Glasgow Kelvin)

I welcome the fact that the cabinet secretary recognises that Scottish cash in transit workers are vulnerable to violent attacks on the job. Does the minister agree that the threat of violence should never be seen as an occupational hazard? Will he note that workers in the industry are reporting a rise in incidents? Given that, and the fact that the Home Office has already taken steps to reduce this type of crime by getting the parties together to discuss what can be done, will the cabinet secretary consider having a meeting with interested parties, including GMB, which will represent the workers, to discuss our concerns?

Kenny MacAskill (Scottish National Party, Edinburgh East and Musselburgh)

Absolutely. No one in any occupation should have to view violence against them as part of their job. That applies to those who work in the transit of cash industry and equally to police officers, who should not be viewed as punch-bags for whoever seeks to take out their ill humour on them.

I am more than happy to consider any meetings, but I confirm that the Government is acting, and we believe that the best way of doing that is to deliver a visible police presence in our communities to deter criminals and to reassure good citizens. That is why we are delivering our commitment to 1,000 additional officers in our communities. Equally, we acknowledge the problem of serious organised crime that this country faces, which is why we have set up a serious organised crime task force to tackle those who are involved in the peddling of drugs and other matters such as armed robbery.

David Whitton (Labour, Strathkelvin and Bearsden)

To ask the Scottish Executive when the Minister for Communities and Sport will produce his strategy for housing. (S3O-2957)

Stewart Maxwell (Scottish National Party, West of Scotland)

The Scottish Government's discussion document "Firm Foundations: The Future of Housing in Scotland", which was published in October 2007, sets out our vision for the strategic future of housing in Scotland. Earlier this month, we published an analysis of the consultation responses and we will be involved in discussions with the Convention of Scottish Local Authorities and other stakeholders during the coming weeks, with the aim of making a policy statement before the summer recess.

David Whitton (Labour, Strathkelvin and Bearsden)

I thank the minister for his answer, although I am not sure that all those who are connected with housing will.

The analysis to which the minister refers was sneaked out during the recent recess. In it, there was no target for affordable housing and little support for the Scottish National Party plans to force housing associations to compete for subsidies. Will the minister give a commitment today that his housing strategy will be subject to scrutiny by a committee and a full parliamentary debate?

Stewart Maxwell (Scottish National Party, West of Scotland)

The report to which the member refers was an analysis of consultation responses so of course it will not talk about all the things that he claims are missing from it. I reiterate that there will be a debate in Parliament and an opportunity for committees to consider the housing strategy, and all stakeholder organisations, including COSLA and all the housing associations, will have the opportunity to take part in further consultation once the statement has been made.

Elaine Murray (Labour, Dumfries)

To ask the Scottish Executive whether guidance has been issued to local authorities regarding the payment of kinship care allowances. (S3O-2948)

Adam Ingram (Scottish National Party, South of Scotland)

Yes. The Scottish Government and the Convention of Scottish Local Authorities have issued a joint information note to local authorities regarding the payment of kinship care allowances.

Elaine Murray (Labour, Dumfries)

Does the guidance state that kinship carers who previously applied for residency orders on the advice of social services, as was the case for Dumfries and Galloway kinship carers, are to be excluded from kinship care payments?

Adam Ingram (Scottish National Party, South of Scotland)

As the member will be aware, she is referring to section 11 orders, which define kinship care for non-looked-after children. Local authorities have discretion to provide payments to children and families in need, so the premise of her question is factually inaccurate.

First Minister's Question Time

Wendy Alexander (Labour, Paisley North)

To ask the First Minister what engagements he has planned for the rest of the day. (S3F-670)

Alex Salmond (Scottish National Party, Gordon)

Later today I will have meetings to take forward the Government's programme for Scotland, which is enjoying substantial support among the Scottish population.

Wendy Alexander (Labour, Paisley North)

This week, I will ask the First Minister about obesity. It is a challenge that America and Scotland share: the United States is top of the global league of fat nations and we in Scotland are second. Why did the SNP Government brief at the weekend that it had agreed to break its manifesto promise to deliver two hours of quality physical education for every pupil in Scotland?

Alex Salmond (Scottish National Party, Gordon)

Wendy Alexander should not believe everything that she reads in the papers. Reports that we intend to scrap that target are completely unfounded, which should make her next question rather interesting.

Wendy Alexander (Labour, Paisley North)

It is interesting that the Government's official spin doctor announced on Sunday that

"it has now been agreed that the new curriculum framework"

should have

"no input requirements in terms of subject or time allocations."

On Sunday, the two hours of PE was gone. Now it seems that the First Minister has changed his mind. It is good to see that Labour has delivered a second U-turn in two days from the First Minister. This morning, under pressure from Labour, there was a U-turn on water rates and we have just had a U-turn on PE. If the pledge is staying, how long will it take to deliver and how much will it cost?

Alex Salmond (Scottish National Party, Gordon)

I am delighted that Wendy Alexander wants to claim the credit for Scottish National Party initiatives. She will certainly have more success in doing that than in claiming credit for the Labour Party's policies, which nobody supports.

Over the next three years, we are putting additional investment of more than £40 million into tackling childhood obesity. That is action from the SNP Government. There was no such quotation from a Government spin doctor—spin doctors are the people that Wendy Alexander keeps sacking.

Wendy Alexander (Labour, Paisley North)

It was not just the Government's official spokesperson. Let us try the Convention of Scottish Local Authorities education spokesperson, who is a member of the SNP. She said:

"We are moving away from narrow targets such as two hours of PE".

The First Minister said that the commitment will be delivered, but as usual he dodges the question when it comes to the detail. With the two-hour target, every parent in Scotland knows where they stand with their local schools, so that is the promise that we look for. If the Government is tempted to negotiate away the target again in its discussions with local authorities, will the First Minister guarantee to come back to the chamber and explain any changes to that promise?

Alex Salmond (Scottish National Party, Gordon)

The difficulty with Wendy Alexander reading out her third question is that she cannot take into account the answer to her first question. I repeat it again for her benefit. Reports over the weekend that we intend to scrap the existing target are completely unfounded. For her benefit and for the benefit of Labour members, I point out once again that investment in this area is increasing by an extra £40 million over three years. Will Wendy Alexander also want to claim the credit for that?

Wendy Alexander (Labour, Paisley North)

I thank the First Minister for his answer. I have no further questions, because he has changed his mind and he has made a promise. My job for today was to secure the U-turn. We have secured the U-turn and his promise is now to stick to that position.

Alex Salmond (Scottish National Party, Gordon)

rose—

Alex Fergusson (None, Galloway and Upper Nithsdale)

There was no question, First Minister.

Alex Salmond (Scottish National Party, Gordon)

Presiding Officer—[ Interruption. ]