Subsection (1) places a duty on the Parliament to provide for the payment of salaries to Members of the Parliament and the members of the Scottish Executive including the junior Scottish Ministers.
Subsection (2) allows the Parliament to provide for the payment of allowances to members of the Parliament and members of the Scottish Executive including the junior Scottish Ministers. It is for the Parliament to determine what allowances if any are payable but it could provide, for example, for allowances for the provision of secretarial services etc.
Subsection (3) allows the Parliament to provide for the payment of pensions, gratuities or allowances to or in respect of any person who has ceased to be a member of the Parliament or a member of the Scottish Executive. It is for the Parliament to determine what provision is to be made but it could for example, include provision for payment of a gratuity similar to the resettlement grant paid at Westminster when an MP fails to be re-elected. The subsection also allows the Parliament to provide for a pension etc. to be payable to or in respect of any person who has ceased to hold an appointment in the Parliament or Scottish Executive but who continues to be a member of the Parliament or the Scottish Executive. There is, however, nothing to prevent an MSP contributing to a pension scheme under private arrangements.
Under subsection (4) the provision made by the Parliament under subsection (3) may include in particular provision for contributions or payments towards the provision of pensions, gratuities and allowances. The Parliament may also make arrangements for the establishment and administration of one or more pension schemes. It can do this through the Scottish Parliamentary Corporate Body (SPCB) or by such other means as the Parliament decides.
Subsection (5) provides that “provision” includes provision by an Act of the Scottish Parliament or by a resolution of the Parliament conferring functions on the SPCB. All references in this section to a member of the Scottish Executive include a junior Scottish Minister.
Commentary Part V: Miscellaneous and General Details of Provisions