Plenary, 06 Feb 2003

Meeting date: Thursday, February 6, 2003

Official Report 697KB pdf

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First Minister's Question Time

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SCOTTISH EXECUTIVE

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Cabinet (Meetings)

To ask the First Minister what issues will be discussed at the next meeting of the Scottish Executive's Cabinet. (S1F-2471)

Next week, the Cabinet will, as ever, discuss a range of important issues.

Will the First Minister support an inquiry by the Auditor General for Scotland into profiteering in all current private finance initiative contracts?

Audit Scotland's recent publication on education public-private partnerships showed that, on the whole in Scotland, those partnerships are producing good contracts and good outcomes. It also showed that the way in which those contracts are carried out is improving all the time, and that that will lead to significant further improvements in the longer term. That kind of evidence is very useful for us and is used by local authorities and the Executive all the time.

Let me give the First Minister some other evidence that concerns me greatly about the contracts to which he has just referred. The Amey group, which has put its stake in the Edinburgh and Glasgow schools PFI contracts up for sale, has revealed a profit margin on those projects of a staggering 31 per cent over 12 months. That means that, for every £100 of taxpayers' money spent on those schools contracts, £31 has gone to profiteering right away.

The First Minister and I both agree that profit is a good thing—[Members: "Oh!"]. There is a but. Surely the First Minister believes that profiteering at the expense of school pupils is unacceptable. I ask for a second time: will the First Minister support an inquiry into profiteering in PFI contracts?

Mr Swinney cannot have it both ways. He and his finance spokesperson cannot wander round the boardrooms of Scotland claiming to be strongly in favour of private enterprise and a dynamic Scottish economy and also come to the chamber, week after week, to criticise private companies that are currently delivering school buildings, hospitals and other physical improvements in our infrastructure. Those improvements are making a real difference to pupils, patients and road users as well as many others across Scotland.

We will continue to support public-private partnerships, not only because they deliver value for money but because they deliver on time and to a high specification. Those partnerships are delivering the schools, hospitals and other public services that Scotland needs for the 21st century.

The First Minister's position is crystal clear. He believes that 30 per cent of the money that he allocates to build new schools should go right out the door and, instead of being spent on school pupils, should be spent on profiteering by private contractors in PFI contracts. Will he take this last opportunity in this question time to commit himself to an independent inquiry into those contracts, to guarantee that such a disgraceful waste of taxpayers' money is brought to an end and that we build new schools that benefit the pupils rather than the private contractors?

Audit Scotland has recently carried out an investigation of public-private partnerships in Scotland. That investigation resolved not only that we should continue to use those contracts and learn from them but that they were a benefit to schools and to Scotland.

We see a clear division in the chamber. We know that the Scottish National Party would cancel the schools contracts that we are currently funding. We will talk about the issues for the election on 1 May. When we say that there will be 300 new or refurbished schools in Scotland in the second session of the Parliament, we mean it. We will go ahead with those contracts and will not cancel them. Scottish voters, pupils and parents will enjoy the benefits.

Will the First Minister join me and express his sympathies to my constituents who were told that, following the closure of the Boots Company factory in Airdrie, they will lose their jobs? Will he assure my constituents that every effort will be made by the Scottish Executive and Scottish Enterprise to encourage Boots to reverse its decision? If that proves to be impossible, will he assure me that every possible support will be offered to ensure that employees receive a fair redundancy package and are assisted in their efforts to find alternative employment?

I share Karen Whitefield's disappointment at the decision and anger at the way in which it was announced and handled. When the Boots Company was offered assistance in coming to decisions about its strategy for the future of its United Kingdom factories at the end of last year, it should have taken that assistance rather than conducting discussions in private and taking a decision without any input from Government at any level, in Scotland or elsewhere.

When Iain Gray meets representatives of Boots tomorrow, it will be to express those views and to do what we can to secure further consideration of that particular decision. If that is not possible, we will do what we can to secure a future for the Airdrie work force, who desperately need those jobs or alternatives.

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Secretary of State for Scotland (Meetings)

To ask the First Minister when he last met the Secretary of State for Scotland and what issues were discussed. (S1F-2488)

I met the Secretary of State for Scotland on Monday night and we discussed a range of important issues. We plan to meet again next week.

I thank the First Minister for that answer. I am sure that, at their next meeting, they will discuss the matter raised by Karen Whitefield in relation to the job losses in Airdrie, which will be of concern to the secretary of state as well as to the rest of us.

When we consider the broader picture, the results announced by the Scottish Executive yesterday indicated that last year the Scottish economy grew by the staggering total of 0.1 per cent. Since Labour came to power at Westminster, the Chancellor of the Exchequer has heaped additional burdens of tax and red tape on businesses to the tune of £15 billion per year, including a £5 billion per year raid on our pension funds with disastrous effects, and a forthcoming tax on jobs in Scotland with the hike in national insurance contributions.

To compound that, the First Minister himself abolished the uniform business rate, putting Scottish businesses at a competitive disadvantage. Is it not about time that he admitted that that policy was a disastrous mistake and set about cutting the burden of taxes, rates and red tape on Scottish businesses, large and small?

I have two points to make. First, although Scotland's growth rate is disappointing and has been so for some time, it is important that the centre of our economic strategy should be to secure a higher growth rate for Scotland in the future. I believe that that will be built on the stability of the United Kingdom economy and on our planned investment in education and skills, transport, communications infrastructure, promoting Scottish exports abroad and supporting an entrepreneurial culture in Scotland. I believe that that is the way forward for Scotland and that it will grow our economy at a faster rate in the future.

Secondly, I do not believe that we should talk Scotland down. As the Minister for Enterprise and Lifelong Learning pointed out yesterday, if the figures for the electronics industry are taken out of last year's growth calculation, it will be seen that Scottish growth was at a higher rate than that of the rest of the United Kingdom. That is a good thing for the Scottish economy. I hope that Mr McLetchie will agree that we should not be talking Scotland down.

I never talk Scotland down. However, to say that the situation is fine if we strip out the figures for the electronics sector is quite ridiculous. It is like saying that if we do not count burglaries then the crime rate is down. That is a classic case of spin-doctoring nonsense.

The economic approach of the Labour Government at Westminster and the First Minister's Administration in Scotland is coming apart at the seams. I tell the First Minister not just to take advice from the Scottish Conservatives but to look at what our major business organisations—CBI Scotland, the Institute of Directors, the Federation of Small Businesses and the Scottish Chambers of Commerce—have been saying in the manifestos that they have published in the past month. Those organisations all say that we should be cutting business rates significantly, reducing the burden of regulation and red tape, and increasing investment in our transport system to make up for Labour's five years of neglect and delay. If the First Minister will not listen to us on these issues, will he at least listen to Scotland's businesses community and do what it is asking?

Mr McLetchie's first point trivialises the situation. We all know that there has been a serious downturn in the international economy in relation to electronics and, in particular, there has been a shift in the electronics industry from developed countries such as ours to elsewhere. The other 94 per cent of the Scottish economy is in a stronger condition than the economy elsewhere in the United Kingdom, and that is a positive thing for Scotland. David McLetchie should not encourage those who wish to create a separate Scotland by encouraging their myths on this subject.

It is important to recognise the strength and stability of the Scottish economy as part of the UK economy. Just today, interest rates in Scotland have been reduced to 3.75 per cent, which is their lowest level since the mid-1950s. We have inflation in Scotland at its lowest level for decades. Unemployment in Scotland is below 100,000 for the first time since 1975. All those Tory years—when inflation was going through the roof, when interest rates were at 15 per cent, and when unemployment reached 3 million across the UK—are now behind us. We no longer have boom and bust; we have a strong, stable economy, and in Scotland we can grow from that basis.

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Learning Environment

To ask the First Minister what measures are being taken to modernise the learning environment. (S1F-2484)

Since 1999, more than 100 Scottish schools have been rebuilt or modernised. The estate strategy announced on Monday will include more than 300 new school buildings in the next few years.

I thank the First Minister for that response, and whole-heartedly welcome the announcement this week of additional investment in our school estate. Does he agree that such investment is long overdue, and that the extra finance allocated to my local authority in Fife, for example, will go a long way to ensuring that primary schools that were built in the 19th century are fit for the 21st century?

Yes, clearly. The other fact that it is important to stress from this week's announcement is that while we believe that public-private partnerships and the rebuilding of those schools are vital for Scotland, we also believe that mainstream funding for the maintenance of schools and the basic repairs that are required is an essential part of our public expenditure in Scotland. That is why a package of more than £100 million was announced this week, which will make a real difference to parents and pupils throughout Scotland.

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Roads (Maintenance)

To ask the First Minister what review will be undertaken of the maintenance of trunk and local roads during the recent severe weather conditions. (S1F-2482)

The winter maintenance arrangements and the performance of the companies involved are regularly reviewed and publicly reported and, where necessary, enforcement action is taken.

The First Minister will be aware that my constituency of West Aberdeenshire and Kincardine was the worst affected last week, with 6,000 drivers stranded in a 12-mile tailback on the A90 south of Stonehaven. Does he share the concerns of many of my constituents who feel that the standard of the gritting and clearing operations on the A90 has fallen markedly since Aberdeenshire Council stopped undertaking the work?

If any fault for what happened last week lies with those who are responsible for the contracts, that matter will be picked up and acted on, but I must say that following firm enforcement action this time last year, at the early stages of the contracts, those who are responsible for the contracts acted on the matters that were raised with them and significantly improved their performance. We are serious about reviewing performance and acting on that, and we will do so again if that is required.

Is the First Minister aware that a cyclist was killed last week on a particularly dangerous stretch of the A68 trunk road in Dalkeith in my constituency? Can he assure me that his Minister for Enterprise, Transport and Lifelong Learning will look urgently at increasing safety measures on that particularly dangerous stretch of trunk road?

I was not aware of that incident, but I would be happy to discuss it with Rhona Brankin following questions.

Does the First Minister agree that to the travelling public it is irrelevant who carries out the gritting, because the issue is the effectiveness of the gritting? Is he satisfied that the current contractual arrangements allow sufficient proactive gritting, rather than waiting for accidents to happen or ice to form?

I sympathise with Mr Mundell on the situation in which he found himself over the past week. As I said to Mike Rumbles, it is important that where incidents occur and where there is any concern about the local performance of the companies involved, those concerns are reported. If enforcement action is required to improve the work that is carried out and ensure that contractual standards are met, that action will be taken.

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Common Agricultural Policy (Review)

To ask the First Minister how the Scottish Executive intends to respond to the European Commission's proposals on the mid-term review of the common agricultural policy. (S1F-2472)

We support the reform of the common agricultural policy, but we have serious concerns about some of the proposed details. We are preparing our response in consultation with the industry and with United Kingdom Government departments.

Is the First Minister aware that the decoupling and modulation elements of the proposals could severely disadvantage Scotland, our beef sector and the general level of Scottish agricultural support? Will he speak to the Prime Minister, Tony Blair, to ensure that we learn the lessons from the fisheries debacle in December? Our farming communities are extremely nervous that the UK Government will sell them down the river in a similar situation to that which was faced in December's fisheries talks. Will the First Minister speak to the Prime Minister to ensure that that does not happen in the talks later this month and over the next few months?

I share many of the concerns that have been expressed. We are acting on those concerns in consultation with the industry and with UK Government departments. Ross Finnie will continue those discussions at UK and European levels. I am happy to take up the challenge that Mr Lochhead sets me and I will set a challenge back: when Mr Finnie goes to Europe to conduct negotiations, I will be grateful if Mr Lochhead promises not to go there to undermine him.

Is the First Minister aware that the present European Union sugar price is €630 per tonne and that the world market price is €180 per tonne? As sugar is a key component in the manufacture of antibiotics, on which 600 jobs in my constituency depend, will he give an assurance that he will do all that he can to bring about a change in the EU sugar regime?

I am happy to take up Irene Oldfather's point, which is not one that I have discussed in the past few hours with Mr Finnie or anybody else. I hope only that my reduced sugar intake since January, as part of the healthy eating campaign, is not affecting jobs in her constituency.

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National Theatre Company

To ask the First Minister what plans the Scottish Executive has for the funding of a national theatre company. (S1F-2474)

We remain committed to a national theatre for Scotland, but our immediate priority is support for local theatres, so that a national theatre has a base on which to build.

I am immensely disappointed by the First Minister's response. In the past few weeks, the Executive's relationship with the Scottish Arts Council has been shot to pieces, the Executive's plan for a national theatre company has been shot to pieces by the allocation of funding that was earmarked for it to regional theatres and, as a result, the Executive's cultural strategy has been shot to pieces. Does he agree that, as a consequence of those actions, the Minister for Tourism, Culture and Sport is a lame duck?

I disagree. The correct decision was made. When the costs of running our regional and local theatres rose dramatically in the past year, it was right and proper to allocate the funding that would have gone to the national theatre to those theatres, to ensure that they could maintain their performance record.

Contrary to what some individuals might have said in the press in the past month, others agree with that point of view and agree strongly with the Minister for Tourism, Culture and Sport. In The Herald on 22 October 2001, somebody said that

"To establish a national theatre at a time when existing theatre companies are under financial threat and being forced to retrench, or indeed close down, would be a foolish waste of money."

That was not said by Mr Monteith—I give him credit for that. It was said by Mike Russell.