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  1. Finance Secretary Derek Mackay announces income tax changes that will see higher earners pay more than elsewhere in the UK - and lower earners pay less
  2. Mr Mackay announces a new tax band of 21p for those earning more than £24,000
  3. The higher rate of tax will be increased from 40p to 41p and the top rate from 45p to 46p
  4. A starter rate of 19p in the pound will also be introduced, Mr Mackay confirmed in his draft budget

Live Reporting

By Craig Hutchison, Andrew Southwick, Nasim Asl and Catherine Lyst

All times stated are UK

That's all from Holyrood Live on draft budget day!

Derek Mackay arrived in the Holyrood chamber alongside First Minister Nicola Sturgeon ahead of his budget speech
Getty Images
Derek Mackay arrived in the Holyrood chamber alongside First Minister Nicola Sturgeon ahead of his budget speech

That's all from Holyrood Live on 14 December, better known as draft budget day.

Today the Scottish government announced income tax changes that will see higher earners pay more than elsewhere in the UK - and lower earners pay less.

The country's finance secretary, Derek Mackay, announced a new tax band of 21p for those earning more than £24,000.

The higher rate of tax will be increased from 40p to 41p and the top rate from 45p to 46p.

But a starter rate of 19p in the pound will also be introduced, Mr Mackay confirmed in his draft budget.

Mr Mackay said the move will mean no one earning less than £33,000 in Scotland will pay more tax.

Income tax

Writers to the Signet Dependants’ Annuity Fund Amendment (Scotland) Bill debate

MSPs participate in the final stage proceeding of the Writers to the Signet Dependants’ Annuity Fund Amendment (Scotland) Bill.

The Bill deals with a fund for dependants of members of the WS Society (an independent association of solicitors).

The legislative regime governing the fund is based on primary legislation.

Conservative MSP Alison Harris
Conservative MSP Alison Harris

The trustees to the Fund consider that two aspects of this legislation needs updating.

The Bill therefore proposes removing the requirement that the 'collector' (i.e. administrator) of the Fund is a also contributor to the Fund. The aim being to widen the pool of persons eligible to be a collector

In addition, the Bill proposes amending the definition of 'actuary' in the legislation to reflect the merger of the Faculty of Actuaries in Scotland and the Institute of Actuaries in 2011.

Read more about the Bill here.

MSPs vote to unanimously back the Bill.

Minister welcomes appetitie for debate on tackling inequalities

Equalities Secretary Angela Constance
Equalities Secretary Angela Constance

Equalities Secretary Angela Constance says it is "welcome and grateful that there is an appetite for continued debate".

Ms Constance praises Labour MSP Anas Sarwar's contribution as "excellent".

She says: "The facts of the matter are very harsh.

"Ethnic minorities are twice as likely to be unemployed."

The minister adds: "We know ethnic minority women are hit hardest by austerity."

Labour MSP Kezia Dugdale raised the issue of Sikh women, and says they are one of the most marginalised people in Scotland.

Ms Dugdale asks if the minister will meet with Sikh Sanjog.

Ms Constance says she will try to engage with Sikh organisations.

On indigenous groups, she says Scotland has not done enough to help and says "If you're going to change something, you have to own it, you have to address it."

Tory MSP says resources should be prioritsed to tackle inequalitiies

Tory MSP Jamie Greene
Tory MSP Jamie Greene

Tory MSP Jamie Greene says to the people to whom this debate really matters this is more important than the budget.

Mr Greene says resources should be prioritsed to tackle inequalitiies.

The Tory MSP says: "Are we blinded by talking about how open we think we are?"

Background: Prejudice of all types 'falling across Scotland'

Rainbow flag

In September 2016 we reported prejudice based on age, disability, sexual orientation, gender, ethnicity or religion was falling, a study for the Scottish government has suggested.

The report said 70% of Scots believed everything possible should be done to rid Scotland of prejudice of all kinds.

It showed a 50% drop since 2010 in those who would be unhappy about a relative in a same-sex relationship.

The Scottish government said the figures "show clearly that Scotland is becoming a more tolerant place".

The Scottish Social Attitudes Survey: Attitudes to Discrimination was commissioned by the Scottish government and the Equalities and Human Rights Commission.

It was carried out by the Scottish Centre for Social Research.

Labour MSP hopes budget does not overshadow important debate

Labour MSP Mark Griffin
Labour MSP Mark Griffin

Labour MSP Mark Griffin calls it a "momentous day in the chamber" and says it would be a shame if the budget overshadows the debate.

He says: "It is alarming that ethnic groups are more likely to be in poverty than their white peers, but have a lower rate of benefit uptake."

Background: Economic forecasts

  • The Scottish Fiscal Commission published its first economic and fiscal forecasts
  • The economy is predicted to grow 0.7% this year and next, and 2.2% in 2022
  • Wages will increase by 2%, 2.3% and 3.1% in 2017, 2018 and 2022, respectively
  • Employment is forecast to grow 1.6% this year, but will slow to 0.6% in 2018 and 0.1% by 2022
  • Productivity growth will remain slow this year (0.2%), before speeding up slightly to 0.5% in 2018 and 1% in 2022
Getty Images

Conservative MSP welcomes news of a new ministerial working group

Alexander Stewart

Conservative MSP Alexander Stewart welcomes the new joint ministerial working group.

He says: "We need to focus our efforts on working together, making communities feel safe, and supporting individuals."

Draft budget: Councils/police/carers

  • Core funding for councils will increase by £94m - resource budgets are to be protected in cash terms, while capital budgets are increased in real terms
  • £20m of additional investment will go to the police to protect revenue budgets
  • A specific figure has not been attached to the new benefits yet, but there was a pledge to provide in-year funding for the new carers allowance to begin in summer 2018

Draft budget: Transport

  • £1.2bn for transport infrastructure, including road and rail developments
  • A transition to electric vehicles, including green buses, is supported by £20m
  • £4bn worth of infrastructure for active and sustainable travel as part of a £20bn investment plan over the lifetime of this parliament

Decision to exit the EU has 'emboldened the far right' - Alex Cole-Hamilton

Lib Dems MSP Alex Cole-Hamilton
Lib Dems MSP Alex Cole-Hamilton

Lib Dems MSP Alex Cole-Hamilton says that: "The 121 action points recommended by the plan show the distance we still have to travel as a nation."

He says: The calamitous decision to exit the EU has embolden the far right."

Referring to the committee last week with members of the Gypsy/Traveller community, including Davie Donaldson, he says "I am not overstating things when I say it amounted to two of the most informative hours of my career."

Background: Scottish Gypsies still face 'acceptable racism'

Davie spent much of his childhood on Traveller sites around Scotland
Davie Donaldson
Davie spent much of his childhood on Traveller sites around Scotland

Discrimination against Gypsy/Travellers in Scotland has become the last form of "acceptable racism", a young campaigner claims.

Davie Donaldson, 19, said the public's view of Gypsy/Travellers had "remained stagnant" since the 1980s.

He said travellers faced discrimination in education and were often being prevented from setting up camps.

The Scottish Parliament's Equalities Committee was marking Human Rights Day 2017 by focusing on the issue.

Davie Donaldson is a campaigner for Travellers rights
Davie Donaldson is a campaigner for Travellers rights

Read more here.

'No-one should be marginalised or discriminated against'

Scottish Green MSP John Finnie
Scottish Green MSP John Finnie

Scottish Green MSP John Finnie says he very much welcomes this debate and says no-one should be marginalised or discriminated against.

Mr Finnie says his amendment, calling for more progress in tackling the discrimination faced by Gypsy/Travellers, was not selected for this debate.

He says there is limited data and information so he says he will back the Tory amendment.

Draft budget: Housing

  • Land and buildings transaction tax (formerly stamp duty) will not apply for first-time buyers for properties under £175,000
  • £756m will be allocated as part of the wider £30bn investment for building affordable homes
  • £137m will be given to support energy efficiency and heat decarbonisation measures
  • An initial £10m has been allocated to an ending homelessness fund, with £50m to be provided over the next five years
  • The bedroom tax will continue to be mitigated

Draft budget: Business and economy

  • The economy, jobs and fair work portfolio will be given £270m more
  • £18m will go to the new national manufacturing institute
  • £122m more for city region deals
  • Business research and investment will see a 70% uplift and £10m will be provided for the new south of Scotland enterprise agency
  • The business rates relief package will total £720m, including the continuation of the small business bonus scheme
  • The poundage rate inflation will be capped at CPI next year, rather than at RPI
  • £340m has been allocated to the establishment of the Scottish national investment bank, with £150m over the next two years to go to a building Scotland fund while the bank is set up
  • Procurement for the Reaching 100 superfast broadband programme begins immediately, supported by £600m over the next four years

'Today I am nervous talking about race' - Anas Sarwar

Labour MSP Anas Sarwar
Labour MSP Anas Sarwar

Labour MSP Anas Sarwar says "In the entire history of the Westminster parliament we have only elected three ethnic minorities."

He says that "Often we are nervous when talking about race.

"Today I am nervous talking about race."

Mr Sarwar asks how many CEOs, chairs of public bodies, governemnt departments, special advisors and staff running political parties (among others) are ethnic minorities?

He says the answer to each and every one of them is none, or next to one.

Draft budget: Childcare and education

  • £243m is to be allocated to help deliver 1,140 hours of free childcare - £150m in capital funding and £93m in resource funding
  • The attainment Scotland fund will increase to £179m, with £120m going to the pupil equity fund and £59m in targeted support for children and young people from the most deprived households
  • An additional £10m is available to support children and young people with complex support needs
  • Local government will be given £88m to maintain the pupil-teacher ratio
  • University tuition remains free and £1.8bn will be given to colleges and universities via the Scottish Funding Council

Draft budget: NHS and social care

  • Health resource funding will increase by £400m, bringing the total to £13bn
  • £110m for primary care
  • Mental health investment will increase by £17m, with a pledge to deliver 800 new mental health workers
  • £550m to support social care delivery via integrated joint boards and NHS funding

How will the draft budget affect your pocket?

Income tax

Income tax and wages

  • The basic rate of income tax has been frozen at 20p, but a new intermediate rate of 21p will be established for those earning between £24,000 and £44,290
  • A new Scottish starter rate will be introduced, meaning earnings between £11,850 and £13,850 will be taxed at 19%
  • The higher and additional rate of tax will be increased by a penny to 41p and 46p, respectively
  • Combined, these changes mean those earning under £26,000 will pay marginally less tax than elsewhere in the UK, while tax will not change for those earning less than £33,000
  • Public sector pay will increase by 3% for those earning less than £30,000, while those earning more than that will see a 2% increase.
  • A cap of £1,600 will apply to pay increases for those earning over £80,000 in the public sector

Summary of draft budget: Key points at a glance


Finance Secretary Derek Mackay has delivered the Scottish draft budget for 2018-19.

We'll bring you the key points from his speech now.

What is the Scottish Fiscal Commission?

The SFC produces independent forecasts on issues such as tax revenues, expenditure on social security and onshore Gross Domestic Product (GDP).

The commission was established in 2014 to scrutinise the Scottish government's devolved tax forecasts.

It is a non-ministerial department that operates independently of the Scottish government. It gained this status in April 2017.

Chaired by Lady Susan Rice CBE, a former chairwoman and chief executive of Lloyds TSB Scotland, the SFC works closely with HMRC, the UK's Office for Budget Responsibility, Revenue Scotland and the Scottish government, among others.

Read more here.

susan rice
Lady Susan Rice CBE chairs the Scottish Fiscal Commission

Debate and action on equality is 'long overdue' - Pauline McNeil

Labour MSP Pauline McNeil
Labour MSP Pauline McNeil

Labour MSP Pauline McNeil says that "action on equality is "long overdue".

She express her frustration that the debate "has been reduced to an hour and a half slot".

Ms McNeil says Labour will be supporting the Conservative amendment this evening.

She claims that: "Scotland is not that different form the rest of the UK when it comes to institutionalised racism."

Scottish Fiscal Commission: predictions round-up


The Scottish Fiscal Commission (SFC) are predicting:

  • The Scottish economy will grow at less than 1% a year for the next five years
  • GDP will grow at 0.7% in 2017 and 2018. It will rise to 1.1% in 2022
  • Now that taxes have been devolved to Scotland, £16bn will be raised by tax in the next financial year
  • In 2018-19 income tax revenue will be £12.1bn instead of the earlier prediction of £12.3bn. It says the subdued economic growth will have an effect on revenue raised from income tax
  • Revenue from the Land and Buildings Transaction Tax (LBTT) will decrease by £6m in 2018-19 due to the LBTT relief announce in the draft budget
  • The new five-band income tax system will raise an additional £164m in 2018-19


Read more here.

Tories to back government motion

Tory MSP Annie Well

Tory MSP Annie Wells says her party will support the government motion on A Fairer Scotland - Delivering Race Equality.

Ms Wells says more needs to be done for Gypsy/Travellers.

She says it is important to be as proactive as possible when trying to improve the lives of Scotland' minorities.

The Tory MSP says it is important to have an honest debate around this subject and says on a number of fronts progress is stagnating.