Economy, Energy and Tourism Committee

Meeting date: Wednesday, September 7, 2011

Official Report 307KB pdf

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Business in the Parliament Conference and Scottish Trades Union Congress Seminar

Item 5 is really two items: the business in the Parliament conference, and the joint seminar with the Scottish Trades Union Congress. I will take them in the order in which they are mentioned in the paper that has been circulated, dealing with the conference first.

There have been discussions involving our clerks, Scottish Government officials, business organisations and others, and it is proposed that the next conference will be held in May of next year. A theme focused around entrepreneurship and internationalisation has been thought up and developed by those on the steering committee, with the idea of looking specifically at the step-by-step stages of company growth. It is for members to look at the clerk’s paper and see whether there are any specific concerns or comments that they want to feed in, and then to invite the convener and clerks to take things forward.

I have a question about context. I am new to the committee, so this is the first time that I am considering the issue. It struck me from reading the paper that the conference is very much a Government-led initiative, and that we are being consulted on it. When we discussed it before, it appeared to be a committee-led initiative, so I want to know what our role is.

From looking at previous programmes, it appears to me that the conference consists of sessions led by Government and not so much by the committee, and to focus very much on Government. I am puzzled as to how the conference comes together. I am not taking a negative point of view; I just want to be clear in my mind about what we are trying to do and what our role is.

It has certainly struck me before that the conference is very much a joint event involving Government and Parliament—specifically this committee, but also the wider Parliament, in that every MSP is invited to attend and to nominate a business in their constituency or region to take part.

In my view, the event involves Government, Parliament and the business community. The term “business community” is defined widely, as it covers not just profit-making businesses, but anyone who is involved in any type of enterprise, whether it is profit making or not. The STUC has been involved too, as have colleges, universities and so on. It is meant to be a joint initiative.

In the past, the committee has not in practice dealt with that much of the detail in terms of deciding exactly how the timetable will work. A broad theme has been approved, and the work has then been delegated to the clerks to take forward.

It seems from looking at the programme for the previous event that about half of the discussion sessions were led by a Government minister and half by a member of this committee. There was also a panel session to which three or four members of the committee and two ministers contributed. It is meant to be a joint event.

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I want to stress internationalisation. In a previous life, I attended two of these conferences and found them to be very good. I am not saying that it was only the great and the good of Scottish finance who were there, but given the overall situation—indeed, given the implications of the current international economic and business situation—I wonder whether we should spread our wings a bit and look to bring in renowned international businessmen, businesswomen and financiers to provide a different perspective on what we are trying to achieve.

I have just been told privately that that has already been discussed and is on the cards. I think that if we are to discuss internationalisation what you say clearly makes sense.

And we should not aim too low with regard to the people we try to get.

Agreed.

With regard to internationalisation, will there be a focus on a particular sector, or will we just examine the wider economy? Thinking back to one of the reports that the previous committee undertook, I remember that at one point a couple of members had a eureka moment about the need to manufacture more. The issue is not so much the service economy or the financial sector; the fact is that we need to manufacture more. It is widely thought—indeed, this has been widely written about—that the economy can be improved by ensuring that we manufacture and sell more. However, exporting raises other issues such as payment dates. For example, when members of the previous committee visited Catalonia, we were told that one of the drawbacks with exporting there was that it can take up to a year to be paid. That might well put some companies off going into that market. We should not take a narrow perspective on this issue and instead ensure that we encompass all aspects. Personally, I would like a large focus on the manufacturing sector.

The proposal is to be as wide as possible for the simple reason that we want to attract as many delegates as we can from across the spectrum. If we picked only one sector, we would rule out the attendance of a lot of other people.

You make a perfectly reasonable point about manufacturing. Over the course of the day there might be at least six discussion sessions, some of which would break down into sectors. The issue might be an excellent one to run in a discussion session but, as I say, the proposal is to make things as wide as possible to ensure maximum uptake.

My point, which is also about widening things out, relates to the previous item. One problem seems to be the low rate of start-ups. I draw an analogy with the housing market, which stagnates when first-time buyers cannot get on to the first rung of the ladder. The same happens in business, and I hope that the scope of the event will include someone who can speak on that aspect of entrepreneurship.

When you talk about first-time buyers, is that just an analogy? Are you talking about microbusinesses?

I am actually talking about start-up businesses. It was an analogy.

I was just double-checking.

Again, with those helpful suggestions, are members content to allow us to continue with the preparations?

Members indicated agreement.

As for the date of the event, which is to be held next May, my only comment is that the council elections are scheduled for 3 May. I guess therefore that if we want lots of MSPs to attend, the event will have to take place after that date.

The paper says that more MSPs need to attend the event. I went to the previous conference. Such conferences are an opportunity for businesses—not only in the private sector but in all sections of the economy—to speak directly to MSPs and raise issues; the programme also has a structured element. I encourage as many MSPs as possible—not just from the committee but from the whole Parliament—to attend at least part of the event, because doing so is imperative to driving the Scottish economy forward.

That is agreed. Step 1 is to set as soon as possible a date that people can put in their diaries months in advance, so that the fact that the conference is on a Friday does not hinder their attendance. It is incumbent on committee members to speak to their groups and to ensure that everyone in their groups nominates a business and commits to turning up for as much of the day as they can.

Under the same agenda item, we move on to the proposed joint event with the STUC—information about it begins on page 2 of the paper that we just discussed. Our clerking team and STUC officials have discussed the event, which the STUC would like to take place in the week commencing 20 February next year, to coincide with trade union week.

The STUC has suggested four themes without stating a strong preference for one—they are presented as four equally good options. It is for us to consider the STUC’s proposed timing and themes and to see whether we prefer one of the four themes, although we will ask the STUC whether it really wants one of the four themes. What are members’ views on the timing and the suggested themes?

I will speak up in favour of the first of the four options—I accept that they are not in order of priority in the paper. The question whether the Government’s economic strategy is achieving what it set out to achieve is pretty central. The Administration is at the beginning of a new five-year term, so I am sure that it will consider over the next couple of months where its economic strategy is going and how it will develop in the next few years. I have mentioned the current review of the national performance framework, which is related to that question. I imagine that we will by February have much more sense of where that is going, so the timing might be useful. Such a discussion would be pretty central to issues in which the STUC, the trade union movement, the Government and the Parliament have a shared interest.

So one member has a particular interest in the first option—growth versus the golden rules. Do any other members have preferences? I think that all four options are pretty good.

I quite like the option that Patrick Harvie identified and the third option, which covers employment, given that we were told during our business planning day that employment provides a good way to gauge wellbeing and how the economy is doing. How to get people back to work, and how to get young people in particular into work, is one big issue that we face. However, I do not propose an alternative to the first option—I am torn between those two options.

So you think that both those options are particularly good.

Given my background, I have a bias towards manufacturing. I mentioned internationalisation earlier. It is fine to look at the financial sector and the Scottish economy, but that cannot be done in a vacuum, given how we operate—although I hope that that will change. It would be instructive to look forward rather than back. Unemployment is critical, but we need to consider the Scottish economy and the financial sector in the grander scale of things and the knock-on effect of that on matters such as manufacturing and unemployment. I support the fourth option but with more consideration of international implications and looking forward.

I like all four suggestions, but the two that stick out for me are the fourth and the second. I like the fourth option because the banking commission report will be published on 12 September and we have already discussed this morning the fact that we will keep an eye on it. I know that it will take time to put the event together, but I do not think that we should rule out that option if the seminar is to be held in February. On the manufacturing option, I return to the point that I made earlier: if we are going to move the economy forward, we have to manufacture and export more.

I have a strong preference for option 4, in as much as the failure of the banking system is the reason why we are in recession. That has occupied a certain amount of attention, but it is evident that we still do not have a banking system that is fit for purpose to support economic areas such as manufacturing. Until we get that system right, we will not solve the problems of the economy. It strikes me that we have made limited progress in getting a banking system that is fit for purpose, and that is where I think we should apply our focus.

I would not say that option 4 is not important, but I ruled it out because we will be doing a short inquiry into the issue. We are focusing on it already, and the previous event focused on manufacturing, whereas the other two options are new, different and of equal importance. That is why I went for those two options rather than the ones on banking and manufacturing. We will be carrying out work on the financial sector in our own inquiry, so we could become repetitive, whereas the other options are equally important and need to be looked at.

If there are no other specific comments, I propose that, given that the event is a joint one, we go back to the STUC to say that all four are good suggestions and to ask whether it is equally keen on all four or has one that it really wants to do. We can tie its response in with our remarks today and see which one comes out.

Members indicated agreement.

That is the end of the public part of the meeting as we agreed to take item 6 in private.

10:12 Meeting continued in private until 10:20.