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An important point, which is pertinent to the line of questioning that Mr Dey just pursued, is that the bill will not remove any existing appeal rights—those rights will not be impacted. The bill will provide certainty and clarity about the definition of a material change in circumstances.

The policy intent was clear when Parliament passed the 2020 act. As the order that was made last autumn did, the bill will provide clarity, as I said.

On the point about being retrospective, the bill will not remove any appeal rights—it will provide clarity about the definition of a material change of circumstances. It is for individual appellants to consider whether they wish to appeal—[Inaudible.]—or to withdraw their appeal. That will not change; the bill just provides clarity about the definition of an MCC.

Any provisions that have retrospective effect must be given careful consideration. Our approach to tax is informed by our tax framework, which we published alongside the budget. That gives the best overview of how we will seek to proceed. Part of that is to have continuous engagement and dialogue. Our approach is also underpinned by the Adam Smith principles.

That informs our approach to taxation. As for any unknown unknowns and future hypotheticals, I do not want to speculate, other than to say that decisions about taxation policy are informed by and will be consistent with what we have set out in the tax framework.

As I attempted to convey when I was before the committee last November, we sought to clarify the definition of

“a material change of circumstances”

in the Non-Domestic Rates (Scotland) Act 2020, and the bill seeks to further clarify what we mean by that term. That is the bill’s primary driver: it provides that clarity and certainty for the users of the non-domestic rates system.

Of course, public finances are a consideration, too, and the bill’s financial memorandum illustrates particular scenarios and the potential impact on those finances. Were that impact to materialise, it would have to be factored into how we manage our budget, year in and year out. The key point that I come back to is that, fundamentally, there is uncertainty about the outcome of appeals on the basis of a material change of circumstances, their duration and any potential impact on ratepayers or the public finances.

Effectively, the reasons that I gave for introducing the Valuation and Rating (Coronavirus) (Scotland) Order 2021 back in November apply to the bill. I am conscious that, at stage 1, we consider the general principles of legislation. When the order that was before the Parliament in November was agreed, there was recognition of the general principle of the need to clarify and provide certainty around material changes in circumstances as being clearly delineated, local and specific, and recognition of the fact that broader considerations with regard to the general economy were best captured through revaluation. As a result, we changed the revaluation process from a five-year to a three-year cycle and put in place a tone date that precedes revaluation by a single year to ensure that revaluation means that rateable values and net annual values are more reflective of the market at the time that they are introduced.

I hope that that helps to clarify the intent behind the bill.

The draft instrument is purely technical. It is intended to assist councillors in administering business growth accelerator relief.

BGA relief, which is unique in the United Kingdom, provides 100 per cent relief on new properties for 12 months after they are first occupied and 100 per cent relief for 12 months on property improvements. In order to facilitate the identification of eligible properties by councils, the Non-Domestic Rates (Scotland) Act 2020 requires that the assessor put a mark on the valuation roll to flag new and improved properties.

We keep all our reliefs under review. In response to stakeholder feedback, BGA relief has been expanded a number of times since the Non-Domestic Rates (Scotland) Act 2020 was passed. The draft instrument that we are discussing merely takes that into account and aligns the definition of new and improved properties in the act with the properties that may be eligible for BGA relief from 1 April 2022. That will enable local authorities to distinguish the properties that are eligible for the relief.

The regulations specifically clarify that property improvements include a concurrent change of use in the property and improvements associated with the installation of certain plant and machinery, including the installation of solar cells or solar panels.

Business growth accelerator relief is a flagship relief that has been praised by the business community. It was even highlighted in response to the UK Government’s recent review as a policy that should be replicated in England. I note for the committee’s benefit that the UK Government has chosen to replicate it with a relief only for property improvements from 2023. Business growth accelerator relief in Scotland has been available not only for property improvements but for new builds since 2018.

I hope that members will support the regulations.

Yes, I do. There was an opportunity for those matters to be covered in that dialogue.

I would also mention that although the bill does what was set out in the order, it uses the date of April 2020 rather than April 2021, and there was an opportunity for consultation and direct engagement on that issue between ministers and business organisations—and, importantly, the Parliament—when that order was considered. I am confident that there has been sufficient opportunity for engagement and consultation in the extensive process that I have outlined. The process has allowed issues to be aired and considered, and business has had the opportunity to feed into it.

I am happy to do that. I sought to address the point about consultation and stakeholder engagement in my response to Mr Dey. Certainty is at the heart of what the bill seeks to do.

On how we go forward, as I said in my opening remarks, the key ask on non-domestic rates from business ahead of the budget was to avoid the cliff edge on 31 March. That is exactly what we have avoided through the RHL 50 per cent relief for the first three months of the financial year.

The certainty that the bill will provide, the engagement that took place between the announcement of our intentions and the order being made, and the non-domestic rates policy for the forthcoming financial year, which was informed by the key ask from business, show that in relation to engagement and providing certainty, the Government is absolutely committed to being consistent with the principles that are outlined in the tax framework.

That is a good question and, in answering it, there must be recognition that it has not been possible to help every single business. We are restricted, to an extent, by the mechanisms for getting money out of the door that are at our disposal.

One of the ways that we are seeking to solve that is through the discretionary funding that we have provided to local government, and I have already referred to the latest tranche of £80 million. That reflects the recognition that councils have local knowledge that they can bring to bear in supporting businesses.

We have also sought a few other mechanisms, such as the Scotland loves local fund, to provide support for businesses in other localities more generally. However, the key point to come back to is the fact that we have provided a total of £4.5 billion, £1.6 billion of which responded to the key ask of business, which was to avoid the cliff edge on 31 March.

Obviously, the targeted business support covers a range of actions. Extensive and specific reliefs have been delivered through the NDR system in the past two financial years, and they will address the ask in the coming financial year to avoid the cliff edge. Various business programmes have also been in operation throughout the pandemic. Finally, there has been the discretionary money for local authorities, the last tranche of which is £80 million, and local authorities will have the discretion to decide how to apply it to their own areas.

I hope that that gives an overview of the support that has been provided and how it relates to what we have done on NDR relief. [Interruption.]

I do not have the details of that in front of me. We have published our most up-to-date statistics on the delivery of resource on the Scottish Government website, and local government provides the Scottish Government with returns on its spending for statistical analysis and monitoring.

On how funding is agreed with local government through the Convention of Scottish Local Authorities, the £80 million was subject to principles agreements about what we are trying to achieve. Whether it be through the publication of overall business support, monitoring the returns from local government, or the principles agreements that we have with COSLA for allocating funding, there is a range of ways in which we monitor the money, which is what Mr Briggs is driving at, and make sure that we can evidence that it gets to those who need it.

No, the money has been committed as part of the budget process.

I will not get into the intricacies of the budget process but, as you will be aware, we have found ourselves in quite a challenging situation. I do not want to draw direct correlations between the MCC money and other parts of the budget, because it is quite complex. However, with, for example, the resources that we anticipated as supplementary estimates towards the end of last year and in the early part of this year, we have received less than we expected. Beyond that, we were led to believe that we would receive additional money to support the cost of living, but we did not receive that and we had to find that £290 million from within money that we had already committed.

Fundamentally, the UK Government gave us an indication of money that was going to come, but the money was less than indicated and new commitments had to be met from it that we had not been led to believe would have to be met from it, such as the cost of living package. To take an example, we expected to get £841 million of supplementaries. That went down to £827 million, if I remember correctly. Then, rather than getting £290 million of additional money for the cost of living, we had to take that £290 million from the £827 million.

We explored that situation last week at the Finance and Public Administration Committee in the spring budget revision. I mention it to give you an example of the complexity that is involved at this point of the year. The key point that I come back to is that we have delivered significantly more in business support than we have received in consequentials and we have worked to get that money out of the door as quickly and effectively as possible to the businesses that need it.

As you will be aware, we indicated our intention to act on this in late June. In other words, it preceded the order, which went before Parliament in the autumn. In the interim period, extensive consultation was undertaken by me and my colleagues, the Cabinet Secretary for Finance and the Economy and the Minister for Business, Trade, Tourism and Enterprise, and we met and engaged thoroughly with all the major business representative organisations across Scotland. If memory serves, I conveyed to the committee that the issue that you have highlighted was not raised as a priority at that point.

Following that, the Valuation and Rating (Coronavirus) (Scotland) Order 2021 was considered, with Parliament taking extensive oral and written evidence, on which I was able to answer questions at a meeting of this committee in November. Throughout that process, we have been clear about what we are doing. Indeed, we even announced in the programme for government that we would introduce primary legislation in year 1 of this session, a commitment that I reiterated to this committee in November.

We have continuous and regular engagement with business. As I have said, in the period between announcing the intention to act on MCC and the order being considered in Parliament, we had extensive engagement with the business community, and—in my experience, at least—the issue that you are talking about was not raised to any meaningful extent.