European Structural Funds (South of Scotland)
The final item of business is a members' business debate on motion S2M-177, in the name of Jeremy Purvis, on European structural funds and the south of Scotland.
Motion debated,
That the Parliament recognises the importance to the south of Scotland of European structural funds; welcomes the investment of £44 million in projects such as the Ettrick Riverside Centre, Selkirk, the Eastgate Arts Centre, Peebles, the Border Union Showground, Kelso and harbour investment in Eyemouth; appreciates the efforts of agencies working in partnership to deliver a full spend of the allocated funding, and stresses the importance of the continuation of such funding after 2006, whether delivered from Brussels or repatriated.
I am delighted that the Parliament has an opportunity to debate this issue, which is important for the south of Scotland and Scotland as a whole.
The debate is not meant to establish among the regions of Scotland competition over their desires for economic investment. Many members have in the past made powerful speeches on behalf of their own regions—I do not decry those for a moment. However, we have an opportunity to debate the fragility of the economy of the south of Scotland, the region's priorities and its future in partnership with the European Union.
Together, the Scottish Borders and Dumfries and Galloway cover about one seventh of the land mass of Scotland, but have a small population of just over 250,000 people. The areas are famous for their stunning beauty, rich culture, remarkable history and their proud and distinct small towns and villages. Their beauty is, to a large degree, a mask over the fragile nature of our economy and the pressures that our traditional industries have faced over recent years.
We also face a demographic challenge of out-migration of our younger people, which has been brought about by, among other things, low wages and lack of investment in infrastructure. The economic strategy for the Borders—which I welcomed when it was published earlier this year—and the work of the south of Scotland alliance between the two local authorities directly address those challenges. They do so in partnership with the Scottish Executive and the European Union, which, in the early 1990s, developed policies that took account of the wider problems of economic development in rural areas such as the south of Scotland.
The south of Scotland objective 2 programme has a possible EU funding investment of €73 million—or £45 million. The programme has so far invested more than £24 million in more than 80 projects throughout the south of Scotland. It is worth stressing that the structural funds account for around a quarter of the budgets of the local enterprise companies and area tourist boards and make a major contribution to the economic development budgets of the local authorities.
My motion, which we are debating, highlights some of the innovative ways in which that money has been used. I was delighted to be able to show Jim Wallace, Ross Finnie and other Liberal Democrat ministers and members round Ettrick Riverside, the busy small-business centre in Selkirk, this week.
The funds are also vital for area regeneration initiatives, such as those in Hawick, Eyemouth, east Berwickshire and Innerleithen and Walkerburn in my constituency. The Scottish Borders rural partnership's rural resource centre and the councils for voluntary services have received support from funds and, by working with other organisations and developing expertise in funding applications, they have attracted a net capital increase of over £3 million to the Borders and created more than 100 jobs.
In addition, more than £5 million-worth of awards have been made to the south of Scotland for training and guidance projects under the lowland Scotland objective 3 programme, and there is a large demand for support for environmental and cultural projects under the LEADER + programmes, from which £4 million has been allocated to the south of Scotland.
We also have an opportunity to discuss the future. There are proposed changes to European regional policy post 2006 due to the enlargement of the European Union, which could dramatically reduce the amount of European funding support for the south of Scotland. That will have a significant adverse impact on economic development in the south of Scotland.
The Department of Trade and Industry issued in March 2003 a consultation document on the future of regional policy beyond 2006. That document puts forward the case for the renationalisation of regional policy. It is understood that the Scottish Executive supports that position. I hope that all members made a submission to that consultation and that the minister will be able to comment on the Executive's position in his closing speech.
The south of Scotland requires substantial development assistance in the long term because of the fragility of its local economies. There is enormous potential in the south of Scotland, with its high-quality environment, strong communities, large number of small businesses and relative accessibility to the populations living in the cities of Edinburgh and Glasgow to the north, Belfast to the west and Newcastle and Manchester to the south. A major effort is being made to exploit that potential through tourism, environmental and cultural initiatives, community development, encouragement of inward investment, expansion of local businesses, training, education guidance and support for child care.
I am about to end my speech. I am sure that the member will have an opportunity to contribute to the debate later, if he will forgive me for not giving way at this point.
We must continue to receive the support of the Scottish Executive and of the European Commission after 2006, and all parties in Parliament must work together. I am delighted that many members are attending this important debate, and I look forward to hearing their speeches.
We can allow three to four minutes for speeches.
I congratulate Jeremy Purvis on securing this first members' business debate following the recess. My connection with the south of Scotland goes back more than 30 years, to when I was a teacher in Newton Stewart. I campaigned for many years in the Scottish Borders, and have served four years here as a member for South of Scotland. My perspective on, and concerns about, the demise of the economy in the south of Scotland connected with the changes in European structural funding, now and post 2006, are both personal and political.
Although Jeremy Purvis is quite right to highlight projects that have benefited from European funding, the big picture shows that funding to be drops in proverbial buckets. The Borders lacks decent roads and through rail for passengers and freight, for which no one seems to have any funds. The Borders comes bottom in Scotland for average weekly earnings, the average weekly wage being £346.20, which is £80 below the Scottish average. In the Borders, 95.7 per cent of female manual workers earn less than £280 per week, which is the Scottish low pay threshold.
I am much indebted to the south of Scotland alliance, which in June this year held a seminar on its concerns. That led to a series of parliamentary questions, which I lodged on the subjects of those concerns. The alliance includes representatives from all over the south of Scotland, including councillors and members of local enterprise boards. Some of their concerns are consequences of the enlargement by 10 countries of the EU, of the changes to funding that will be made in 2006, and of the recent DTI proposals, which I understand would involve repatriation of funding to the Treasury and which might also mean any funding's being allocated via the block grant.
I am not surprised that the south of Scotland alliance is worried and I am pleased that it took the opportunity that I suggested at the seminar: to brief our European and External Relations Committee, which is chaired by my colleague, Richard Lochhead. I note that a letter from that committee to Patricia Hewitt—for therein lies the power—expressed concerns about consultation. The letter stated the committee's disappointment with the timing of the consultation, which was launched in March 2003 with a closing date of early July 2003. That period covered the time when the Scottish Parliament was dissolved for elections and its first days afterwards. As the letter went on to point out, that meant that Parliament and its committees had been somewhat disadvantaged in their ability to conduct inquiries and to consult throughout Scotland—one of the founding principles of the way we work. That is much to be regretted. If Richard Lochhead is present for the debate, I am sure that he will say something further on the matter.
Does the member know that the European and External Relations Committee asked for evidence to be submitted in written form, and that a considerable amount of evidence was received, on the basis of which a report was drafted?
Yes, I am aware of that. I was going to leave those points to Richard Lochhead to cover in his speech, which I do not wish to pre-empt.
Let me put on record the Scottish National Party's response on the matter, which was launched by Sir Neil MacCormick MEP. It contains some interesting comments with regard not just to changes to structural funding, but to the whole system. I quote from the response:
"The SNP supports increased flexibility and simplification of regional funding, and recognises that there will be increased demand placed on the structural funds with the accession of ten new Member States. We are strongly of the view that Scotland should be included in the allocation of structural funds after the present programming period ends in 2006."
Do I have another minute left, Presiding Officer?
I am allowing everybody four minutes.
I will curtail my quotation in order to let other members in. The response continues:
"The SNP is of the view that either structural funds or any successor scheme, whether at EU level or Member State level, should be directed at funding infrastructure projects rather than by way of direct payments to foreign companies."
I will not return to the issue of Viasystems and the £17 million that was clawed back by the DTI and which will never see the light of day. However, we must change the rules, because the way to regenerate the Borders economy is to ensure that we have good transport links—good rail and road links. That is the issue on which we must focus.
I congratulate Jeremy Purvis on securing the debate and I apologise to him for failing to sign his motion. Unfortunately, I missed it because the business bulletin is not my most required reading during the recess. However, I am pleased to support the member in the debate.
It is important that we take the opportunity to showcase achievement and investment in the south of Scotland. All that we in the south of Scotland do is moan about the hard lot that we have. If we continually talk down our region, jobs will continue to be relocated in Inverness rather than in the south of Scotland and we will continue to have problems recruiting dentists, teachers, health professionals and other key workers in our area. Let us take this opportunity to debate something positive about the south of Scotland and, indeed, something positive about Europe.
Jeremy Purvis has described several successful projects in his constituency that have used European funding. I want to add a small snapshot of key achievements in Dumfries constituency and the way in which those have contributed to the economic and social fabric of the area.
European regional development funding totalling £488,000 in 2001 helped the Crichton Development Company to refurbish Galloway House on the Crichton campus in Dumfries and to develop the Crichton Business Park, which has provided 400m2 of business space and now has a state-of-the-art call centre that is used by Telegate, or 118866, as the company would like us to say at the moment. It is hoped that the centre will eventually provide 400 local jobs. It is also offering training that is developed and provided locally.
In the same year, the Crichton campus benefited from a grant of almost £500,000 from objective 2 funding towards the refurbishment of Browne House, which has provided a centre for management, personal and professional development. The building acts as an interface with the higher education development on the site, which is a unique partnership between several higher and further education institutions. That partnership now includes the business sector, because the centre aims to meet the demands for training and product development of small and medium-sized enterprises, which are very important in rural economies such as the south of Scotland. It will enable local businesses throughout Dumfries and Galloway to compete more effectively.
Nearly £1 million has been allocated to those two projects centred on the Crichton campus in Dumfries. The projects have attracted inward investment, have provided job opportunities and have provided a facility that will allow indigenous local businesses to develop.
The European regional development fund also contributed nearly £700,000 to a £1.4 million project, led by Dumfries and Galloway Council, to develop a community resource centre in north-west Dumfries, which is one of the more disadvantaged areas in my constituency. That funding helped to upgrade and convert a former old people's home in Lincluden, to create an integrated facility that provides child care, further education, training, volunteering and business start-up advice. Forty-six partner organisations from across the spectrum were involved in converting a derelict eyesore into a focus for local pride and a centre for the entire community, from the very young to senior citizens. The centre has provided 120 child-care places and training facilities that have created 27 jobs—mainly for women. It also has an extremely good café-restaurant that I have had the pleasure of visiting on one occasion.
We have also received £270,000 for the arts and crafts sector, which is developing marketing of arts and crafts in Dumfries and Galloway. Nearly £200,000 was allocated to Dumfries and Galloway College for a flexible access centre. The money helped to purchase 50 computers that are linked to the internet and intranet and which are available not only to students of the college, but to the public.
The area tourist board has lost funding because of the decision of the Executive not to pass on the third tranche of foot-and-mouth disease recovery money. I am profoundly disappointed by, and disagree with, that decision. However, it should not detract from the fact that Dumfries and Galloway tourist board has already received approval to spend £1.3 million of objective 2 money that has come into the region and has done a great deal to promote tourism and information and communications technology.
I welcome the opportunity to debate south of Scotland issues. As Mr Purvis knows, I do not quite agree with the emphasis of the debate, because I believe that the benefit of members' business debates lies in our being able to put ministers on the spot about issues; there are many such issues in the south of Scotland. In general, I welcome the work of the South of Scotland European Partnership. When I was a member of the European Committee I was keen for us to have our own south of Scotland area so that funds could be focused appropriately.
I do not want to detract from the issues that Mr Purvis raised, which instigated the debate, but we must reject absolutely Elaine Murray's premise that to highlight Executive failures is somehow to talk down Dumfries and Galloway, the Borders and the south of Scotland. It is not, because it is Opposition members' job to highlight Executive failures.
The clear policy of and similarity between Dr Murray, Mr Robson and Mr Purvis is that when anything good happens, they say it is because of the Executive. They say that the Liberal Democrats have delivered this, that and the next thing in the Borders and that Dr Murray has delivered this or that in Dumfries. When good things do not happen they say, "It wasnae me. It's nothing to do with us. Let's have a cross-party approach. Let's bring in everybody so we don't attach any blame to us." The reality is that Dr Murray and Mr Purvis are not delivering for those areas. Forest Enterprise is not in Dumfries because Dr Murray, as a member of the Executive, did not have adequate clout to bring it there—we cannot be diverted from that fact. Mr Purvis has not had the influence to ensure that money was paid to VisitScotland.
Will Mr Mundell tell us what he has achieved in the south of Scotland in the past four years?
I have achieved quite a lot, which is why I cut Dr Murray's majority by such a large amount in the election and she suffered one of the Labour party's worst election results. Because of Mrs Grahame's efforts, the Liberal Democrats in the Borders suffered the worst of the Liberal Democrats' results in Scotland. That is because neither the Labour party nor the Liberal Democrats are delivering for the south of Scotland.
We will obviously not be able to achieve consensus on structural funds, which are so important to the entire region—both the Borders and the south of Scotland. It is not beyond the notice of people in the Borders that David Mundell has said that the debate would be full of empty rhetoric and that it would be about motherhood and apple pie. However, it is quite clear that the only empty rhetoric that we have heard has been David Mundell's contribution.
I am afraid that that is not the case. It is obvious that Mr Purvis was not listening to Dr Murray's opening remarks, which prompted me to make mine and limited me to about 45 seconds to highlight the important issues that need to be highlighted. One such issue is the serious problem that the south of Scotland faces in relation to the withdrawal of common agricultural policy funding. Although structural funding is important, the amount of money that it brings in is dwarfed by the amount of money from common agricultural policy funding. If that issue is not addressed, we will be in serious difficulty.
I am not going to ignore the fact of Executive failure in this or any other debate just to get cosy consensus. Consensus might have its purpose, but we do not have consensus in the south of Scotland on the Executive's achievements.
The Scottish Green Party has many problems with the European Union because the EU is largely unaccountable, highly bureaucratic and centralist. However, we acknowledge and welcome the fact that there have been several positive outcomes; the use of European funding to support regions that have particular geographical and structural problems is an area of European Union activity that I hope we can all support. I would like us to take a non-party line on advocating and securing the retention of those funds for the south of Scotland. That is our central objective. I hope and trust that everyone agrees on the importance of such funds to the south of Scotland.
Many projects in the area that I represent exist or have been helped because of those funds. The Wigtown restoration project, which I have an interest and an involvement in, Dumfries and Galloway tourist board, the south of Scotland childminding development project and the host of other organisations in the Borders that have been mentioned are just some examples of schemes that would otherwise not be able to operate at the level that they do today.
As Christine Grahame mentioned, the Scottish Low Pay Unit's recent survey reported that almost half the male manual work force in the Scottish Borders are below the low-pay threshold. That is nearly twice the Scottish average and gives the Borders the highest number of such workers in Scotland. Dumfries and Galloway is close behind it as the region that has the third-highest number of male manual workers who are below the low-pay threshold. Low pay is a major problem throughout the south of Scotland.
Financial assistance from schemes such as the European structural funds is vital if we are to develop sustainable industries and support community developments throughout the entire region. The European funding is welcome, but it is not enough. The sorry news that the Executive will not provide the final tranche of the VisitScotland foot-and-mouth recovery fund is a major blow for one of the major industries in the region. I also agree with the comments that have been made about the lack of dispersal of Forest Enterprise jobs to the region.
We need to ensure that the Executive now energetically advocates the case for the south of Scotland, so that we receive the maximum financial assistance available. In tonight's debate, I look for reassurance from the minister—if he is listening—that he will advocate as hard as he possibly can the case for the retention of European structural funds for the south of Scotland as the debate progresses over the next year. If we can secure that from tonight's debate, it will have been well worth while.
I am pleased to be involved in tonight's debate. I congratulate Jeremy Purvis on his motion and on securing the debate.
My constituency falls in the south of Scotland. Like the projects that Jeremy Purvis mentioned, there are a number of important projects in my area that would never have gone ahead without assistance from the European regional development fund and European social fund. The Magnum leisure centre and James Watt College come to mind.
Those of us who have been involved in European matters for some time recognise that, although difficulties sometimes occur, when we look back we can see just how much has been achieved. Over the years, we have learned how better to focus and target funds to the areas where they can have the greatest return. The fact that the European Commission has described Scotland as a flagship model makes us realise that we have come a long way in managing funds and in our partnership approach at local level.
Post 2006, things will change. The Parliament has regularly embraced the concept of enlargement, and I know that tonight will be no different. We realise that, while enlargement will present challenges, it will also present opportunities to share with the new member states the kind of expertise that I talked about, which we have developed over a considerable number of years.
I believe that that gives us a marketable commodity. The European Commission estimates that around 30 to 40 per cent of European Union funding that is spent in the poorer member states will eventually find its way to the richer member states in the form of purchases of equipment or expertise. Therefore, improving the quality of life in the new member states can benefit all of us.
The DTI's consultation paper has been mentioned during the debate. I am aware that the Executive has set up a working group to find a constructive way forward to ensure that we maximise the returns to Scotland. It would be welcome if, in his summing up, the minister could update us on the progress of that, and the proposed time scale.
It would be remiss of me to speak about European funding without mentioning some of the smaller community initiatives that have delivered first-class results. I have been immeasurably impressed at the excellent links that we in Scotland have developed in relation to the educational aspects of European funding. The opportunities afforded to our children, sometimes in our most deprived communities, to develop language and learning skills, demonstrate that we have tremendous returns for relatively small expenditure in some areas of European funding.
It is important to remind ourselves that the objective of structural funds is to promote economic and social cohesion across Europe and to reduce inequalities and disparities. I know that we in Scotland will rise to the challenge that lies ahead of us post 2006.
I welcome the debate, which Jeremy Purvis secured, because the subject is going to appear on the Parliament's agenda again and again over the next couple of years.
During my first minute, I will wear my hat as convener of the European and External Relations Committee. The committee will be considering the issue because the changes that are going to happen over the next few years are so important to Scotland. Previous committee reports illustrated the value of regional funds to Scotland and the positive impact that they have on the south of Scotland and elsewhere in the country.
Unfortunately, the latest United Kingdom Government consultation gave the committee only a few weeks to consider its ideas, including the controversial idea of renationalising—if we want to use that phrase—the regional funding back to London, which should mean that it should be coming back to Scotland. That issue is very controversial.
We are, of course, discussing this subject because of the enlargement of the EU. On 1 May 2004, the EU goes from having 15 member states to having 25, bringing in countries such as Poland, the Czech Republic and Hungary. A couple of years after that, Bulgaria and Romania might also be coming into the EU.
At the same time, the UK Government does not want to put more money into the European cake. That means that the cake will stay the same size—although it might increase marginally—but it is going to be spread more thinly across 27 member states. We know that that is going to lead to changes in the distribution of regional funding because we are going to get less of that cake.
We have battles on our hands. The first battle is to ensure that regional funding continues and that Scotland qualifies. Unless economic disparity in Scotland disappears post 2006—which I do not expect to happen in the south of Scotland—we are still going to need regional funding. That is the first battle that ministers will have to start fighting.
The second battle is with Whitehall, which favours renationalising the cash and bringing it back to London because it wants to save money. Whitehall says that Scotland does not have to worry about that because there is a guarantee that Whitehall will match any money that has come from Europe. That has a number of difficulties that have been highlighted by agencies and local authorities throughout Scotland that do not trust Whitehall.
One of those difficulties is that the Administration in London might change; future Governments cannot be bound. One Government might say, "Don't worry; we are going to match the funding," but it cannot bind future Governments to that. That means that we could lose cash in future. Let us not forget that regional funding is worth £1.1 billion to Scotland between 2000 and 2006. That illustrates the price that we will have to pay if we fail to get our act together in the foreseeable future. Many people in Scotland do not believe that the guarantee is worth the paper that it is written on and that is a serious issue for ministers.
It is important that ministers take a view. At the moment they are hiding behind the Scottish structural funds forum. We do not know what our ministers' views are. Do they support the repatriation of regional funding? We need to know if they are going to stand up for Scotland's interests in the foreseeable future. If they do not, we could lose hundreds of millions of pounds for peripheral communities in Scotland.
Will the member give way?
I apologise to the member, but I am in my final minute.
My final comment relates to Jeremy Purvis's remarks about the need for consensus. If there is going to be consensus between the Scottish Parliament and its committees, the Government in Scotland and the UK Government, we must have consensus around a particular view. At the moment there is no view and no view is expressed in Jeremy Purvis's motion. He says that he wants regional funding to continue, whether or not the money is repatriated, but if it is repatriated, there might be no funding in the foreseeable future. Not expressing a view is a classic Liberal Democrat position. We need to hear the Liberal Democrats' view because they are part of the coalition. Please get a view. Let us all rally round it and defend regional funding for Scotland's communities.
I am pleased to follow the convener of the European and External Relations Committee, of which I am now a member.
Members in this debate have repeatedly used the phrase "European funding". Richard Lochhead suggested that the Labour Government did not want to put more money for structural funding into the European Union cake. That is quite right, given that Britain is one of the three net contributors to European funding. We talk about European funding being used for all the projects that Jeremy Purvis mentioned, but that funding basically has come directly from the UK taxpayer, not from taxpayers across Europe.
When Gordon Brown talks about repatriation, I have some sympathy with him, and I will support him on that. It disappoints me that, yesterday in the European Parliament, Labour's MEPs failed to support the Chancellor of the Exchequer on that subject and, to a degree, caused chaos with respect to the future of structural funding from a UK Government perspective.
Irene Oldfather talked about the benefits that could come to us from the redistribution of objective funding to the lesser nations in other parts of Europe. She said that the money will work its way back to us, but when I look at her own constituency of Cunninghame South and I see the destruction of manufacturing and production there, I do not know what goods or expertise the people in those far eastern European countries are going to come to Irvine to buy. Unfortunately, the place has been decimated.
We need to examine our own development. I would have far more confidence in a British minister, even a Labour minister, even Gordon Brown, finding funds for useful structural work in Scotland and the UK than I would have in ministers in Europe doing so. In the past, Richard Lochhead has been vitriotic in his condemnation of ministers in Brussels. He should think back to what they did to fisheries, and tell me how he can justify his words in the Parliament today.
I look to some of the good work that needs to be done, but which is not being done. I look to the minister, who has answered my questions on the Maybole bypass on many occasions. We have funds going to Europe. There is money in the structural funds—bags of money, as far as I can ascertain. The president of the European Court of Auditors concluded that the distribution of structural funds is so complicated that it is almost impossible. On that basis, masses of money has accrued that is not being used to provide the advantages that Jeremy Purvis desires.
I return to the Maybole bypass. I would love some funding to be provided for it. When we get the repatriation that Gordon Brown has talked about, I expect the minister to fight his corner for that bypass. I think about some of the good work in East Lothian, and in particular the work on the A1. Once again, Europe has claimed the credit, but it is British taxpayers' money that is going into those projects.
I congratulate Jeremy Purvis on raising the subject of the debate. I congratulate David Mundell on highlighting the deficiencies of the Executive. He hit the nail on the head. I hope that ministers take that on board.
The SNP response to the DTI consultation paper was submitted by Sir Neil MacCormick and the SNP's European policy review group. In that submission, Sir Neil pointed out that
"Successive UK Governments have shown a marked reluctance … to ensure funds are truly additional"
and, in particular,
"that since 1975, the Treasury have retained between £1.6 and £3.3 billion of EU funds that should have been spent in Scotland."
That is the true record of Westminster. Phil Gallie's faith in a British ministry belies that record, which is a sad one. His faith is touching if slightly misplaced. If not "vitriotic", it is certainly irrational.
We have no doubt about the way in which this debate should be going. The debate lies in the last sentence of Mr Purvis's motion: no matter whether Brussels or London is in charge, the important thing is to ensure that money flows in the future as it has in the past. If we are to have consensus in this Parliament—as Richard Lochhead of the SNP has argued that we should—it must be around a clear position. At the moment, the position is as clear as mud. I am indebted to the briefing from the Scottish Parliament information centre, which points out that the current Executive position is that it "cannot adopt a stance". Well, no change there. I am also indebted to Stephen Herbert and Aileen McLeod of SPICe for stating that the majority of people who responded to the European Committee were in no doubt—they had far more confidence in Europe to deliver a better deal on regional funds than they had in the Westminster regime.
Mr Ewing has made it clear that he is not at all happy with the DTI's consultation paper and the money coming from Westminster. Given that, post 2006, money will go east because many regions in the United Kingdom will not meet the criteria, how does the SNP propose to resolve that problem?
I am coming to that right now. My wife and I, under our own steam, attended a meeting in Brussels that brought together around 100 regional and national representatives and bodies from areas that are mountainous, sparsely populated and include island communities. I do not know how much Irene Oldfather knows about such things, but I know a lot because I have taken the time and trouble to campaign here, and around the Highlands and Islands, where aid is absolutely essential. The work of people such as Drew McFarlane Slack in Highland Council has been remarkable in trying to establish a directive, and a new budget line under European regional policy, that recognises as a specific category areas with those features—mountains, sparse populations and islands. This Parliament should be uniting around such proposals.
Why have we heard nothing about that from the Executive? Why has there been a complete wall of silence over the past months and years when every other small and medium-sized country in Europe has not only been debating what its position should be but, having formulated that position, has been going around Europe and winning friends for the position? Those countries are negotiating as independent states in their own right to ensure that they get the best possible deal. Can anyone imagine Ireland in the shambles that we are in now, without an agreed position?
Will the member give way?
No—I will give Mr Purvis the same time as he gave me. I notice that Mr Purvis did not give his position, either in his speech or in his press release. He has no idea what it is. The south of Scotland alliance has grave reservations about the DTI's proposals, so I was surprised that we did not hear about that.
I would be interested to hear why, based on the information in the SPICe paper of 14 August, the forum that was set up to consider this vital matter has not had members such as Ben Wallace replaced since the election. If this matter is so important, why has the forum not even got round to replacing members such as Christine May and Ben Wallace, who are obviously no longer appropriate to serve on it?
I start by congratulating Jeremy Purvis on securing the debate. As has been said by speakers all round the chamber, structural funds have made a vital contribution to regional policy and to supporting sustainable economic growth in the south of Scotland in recent years. All too often in the past, the difficulties that are associated with regional policy funding have been emphasised. Like Elaine Murray, I am pleased that colleagues round the chamber—not all of them, but the majority—have recognised what has been achieved with the structural funds. The work continues, and the current programme will continue approving new projects until 2006.
Let us not forget that, as well as the £50 million in the south of Scotland objective 2 programme, the region has benefited from other structural funding that organisations in the region can access. For example, nearly €500 million is available across lowland Scotland under the objective 3 programme for 2000 to 2006. Local action groups in the Borders and in Dumfries and Galloway are promoting rural development through the LEADER + Community initiative. Partners in the south are also benefiting from the Equal and Interreg Community initiatives. Those programmes and other Community initiatives have been tackling regional disparities across Scotland. They allow us, through the programme management executives, to respond to local problems with innovative solutions.
During the summer recess, I spent some time in the south of Scotland. I saw for myself the difference that structural funds have made. I enjoyed meeting representatives of the local organisations, including councils, the enterprise network, tourist boards and higher and further education institutions, all of which are using this important European funding to make a difference to the economy and to individuals and communities in the south.
It is clear that, in addition to some specific challenges, the area is facing challenges that are very similar to those facing other parts of rural Scotland. I was very pleased to see people working together to take full advantage of the natural environment and the geographical features of the region to stimulate the economy. For example, projects such as the Seven Stanes project, which has developed a state-of-the-art mountain biking centre, take advantage of the upland terrain to transform geographical handicaps into economic assets.
I also saw how redundant buildings have been transformed to modern use in various places, including the impressive Crichton campus in Elaine Murray's constituency, in which further and higher education have come together with the business community to make learning accessible to all. I also visited the Ettrick Riverside development in Selkirk, where I saw for myself what has been done to convert a redundant mill into a modern business centre, which is now the home of a number of dynamic local enterprises.
I know that Jeremy Purvis will welcome the fact that Labour as well as Liberal Democrat ministers took the opportunity to visit the south of Scotland to see what is being done at those excellent projects. I am delighted that structural funds have been able to help such imaginative developments and I am also delighted with the way in which people and organisations are working together to deliver them.
The south of Scotland objective 2 programme has been very successful in stimulating partnership working. It has encouraged partners to work together and to share ideas and good practice. We believe that, as the debate on the future of regional policy unfolds, that policy will remain a fundamental part of the promotion of economic development in the south of Scotland and across the rest of the country.
Will the minister give way?
I will do so in a moment.
We are committed to ensuring that regional policy continues to play that role, whether that is through the EU framework for devolved regional policy, as was proposed in the recent UK Government consultation paper, continuing structural funds support or, indeed, through the Executive's own direct support through regional selective assistance.
The minister has answered my question in part. Given what he has just said, if objective 2 funding is lost after 2006, can he give a commitment that the Scottish Executive will continue to meet such funding?
The approach that is being taken by the UK Government which, as the member rightly stated, is the relevant body in this regard, is to give a guarantee that any change in the funding mechanisms that will apply for Scottish regional policy will involve no net loss of funding to Scotland's regions.
The minister referred to the UK Government's consultation on the so-called repatriation of regional funding. To help the Parliament's committees, all parties in the chamber and the local authorities, will he put on record a clear view of whether the Executive believes that that funding should be repatriated?
I will come to that. I ask Mr Lochhead to be patient.
It is important to note that there was vigorous participation in the consultation exercise in Scotland. UK ministers are expected to report soon on the overall findings of the consultation. A broad range of Scottish opinion was represented and more than 50 responses out of the 300 that were received came from Scotland, including a number from the south of Scotland.
I will come in a moment to some of the other issues that have been raised. Many respondents cited the contribution that the funds have made. They also identified areas in which the funding, by whatever mechanism, could be improved in its delivery in order to remove some of the bureaucratic hurdles and obstacles that exist. Such submissions point us towards some of the things that can be done to ensure that the funds are accessed more readily and that they are more fully used.
The debate has a long way to run and the UK consultation has already stimulated thinking about the critical issues. Of course, the decision process lies in the European Commission's hands. We expect the third cohesion report towards the end of the year to be followed by formal proposals next spring.
Through the European structural funds forum, we pulled together the views and responses of many partners and submitted a response to the consultation that laid out the range of views in Scotland. The Executive's priority is to support regional funding vigorously, whether or not the UK's repatriation proposals are sustained through the European process.
The south of Scotland alliance hoped that, if funds were repatriated to the Treasury, the money that would come to Scotland would be ring fenced. Does the minister support that view?
As we have made very clear to Westminster colleagues, we expect that any proposals to repatriate regional policy decisions or funds should not simply involve repatriation from the European level to Westminster. By definition, the principle of subsidiarity that underlies the repatriation proposals would involve a devolution of responsibility from the UK to this Parliament. However, what we require in any such arrangement is an EU framework that delivers the UK Government's guarantee that there would be no loss of funding if regional policy funding were repatriated.
The point that the debate has still to run is very pertinent. Even if the money is repatriated directly to the Scottish Executive or the Scottish Parliament, it does not matter if it is then divided up using indices of multiple deprivation—it could still act against the south of Scotland. As a result, a debate within the regions of Scotland still needs to take place.
Jeremy Purvis makes an important point. It would be a mistake to pre-empt either the debate or the process. As most of us in the chamber would agree, the priority is to ensure that the regional policy funding stream supporting Scotland's more disadvantaged areas continues in whatever form. That is the focal point of our concerns, our discussions with our colleagues in the UK and the discussions that will take place between the UK and the European Union.
It is clear that, as a result of enlargement, a reduction in structural funds will be inevitable after 2006. No tinkering about with budget lines will disguise the fundamental fact that there will be a change in the balance of regions within the European Union and that that will have consequences. We in government must manage such consequences and seek to ensure that lessons are learned from the programmes that we have introduced thus far. We must also ensure that future funding continues to be targeted effectively to obtain the maximum economic and social benefit.
We will carry the debate forward on that basis; indeed, as various members have pointed out, it is a continuing debate. The strapline that we have used for structural funds in the south of Scotland—"Europe and Scotland: Making it work together"—should continue to inform our debates on this issue in the chamber and elsewhere. I am glad to have seen in practice how that approach is being developed in the south of Scotland and to have had this opportunity to reassert our commitment to make it work together on that basis in future.
Meeting closed at 17:58.