Plenary, 07 Nov 2002

Meeting date: Thursday, November 7, 2002

Official Report 681KB pdf

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First Minister's Question Time

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Secretary of State for Scotland (Meetings)

To ask the First Minister when he next plans to meet the Secretary of State for Scotland and what issues he intends to raise. (S1F-2218)

We plan to meet later this month and I expect we will discuss our proposals for celebrating significant events in Scotland's history as a means of promoting tourism.

I am sure that the events will be of great interest but, today, it's the economy, stupid. Last night, the Minister for Enterprise, Transport and Lifelong Learning admitted that the Scottish economy has underperformed in comparison with the rest of the UK for decades. Since the Executive came to power in 1999, the wealth gap has widened even further. How has the Government managed to make a bad economic performance even worse?

That is simply untrue, and I recall, if I have the exact words here, Mr Swinney saying on 17 August this year that

"the Scottish economy has plunged into recession."

That was a ridiculous assertion then, and what he says is a ridiculous assertion today.

The Scottish economy has far too low a growth rate, and that is why we have a policy that promotes research and development and getting science into products that are then sellable not just at home but abroad. It is also why we need to make the most of the current state of our economy here in Scotland, where unemployment is at its lowest for a generation, where interest rates were today confirmed yet again at only 4 per cent—the lowest rate for a generation—and where employment is higher than in almost all of our key European competitors.

The First Minister challenges the fundamental point that I make to him. Scotland's economy is now growing at a third of the level at which it was growing before the Executive took office in 1999. In the past three years, economic growth in Scotland has been at a third of the UK rate, manufacturing output has fallen at twice the UK rate, and the number of firms going bankrupt in Scotland is 14 times the UK rate. For three years, we have had the Government spinning on the economy—we have had another example of it from the First Minister today—but a bad economic performance is getting worse. Can the First Minister explain to Parliament why a country with such potential is falling so far behind?

It is blatantly obvious to anybody who has any understanding of the Scottish economy why it has had difficulties over the past 18 months. It is not just about the difficulties in either tourism or agriculture last year, but more significantly about our previous, far too heavy reliance on electronics. We know that that is the case and I suspect that most members with any sense, even on the Scottish National Party benches, will realise too that that is the case.

What is important is how we get out of the situation. In the chamber last week I talked of a fundamental divide, and I have to say that there is a fundamental divide on this issue too. We either have a strategy or we have a slogan. The strategy is to ensure that we have the level of productivity, research and development and investment in the Scottish economy in order to grow Scottish businesses and ensure that young people have the right skills and that our businesses can be promoted at home and abroad. Through that, we grow the strength of our Scottish economy and reduce our reliance on those substantial employers who were important in their time but who have now left us because of the decline in the electronics industry. The comparison between that steady strategy, which will grow the Scottish economy, and the strategy promoted by the Scottish National Party, which would take us away from our largest market at this vulnerable time for the Scottish economy, is a fundamental divide that the Scottish people understand fully.

The only steady thing about the First Minister's economic strategy is the steady decline that he presides over in Scotland. If all of what he says is the case, why is growth slowing in Scotland under the Liberal and Labour Administration? That is the reality. If the First Minister does not believe me, what about what one of Scotland's leading businessmen said this morning? He said:

"Scotland is sleepwalking into a disaster ... It's high time the people running Scotland recognised there was a problem and did something about it."

Is it not the case that Scotland is led by politicians who lack the will and a Parliament that lacks the powers to put Scotland at an advantage? Will the First Minister stop making excuses and start taking the powers that will make a difference for Scotland?

On that last point, can we just be honest, John, in the chamber and make absolutely clear what we mean? John Swinney does not mean that the Scottish Parliament should have a few more powers, he means that the Parliament should be separate from the rest of the United Kingdom and that Scottish companies should be separated from their main markets south of the border. The Scottish—

Question 2 is from David McLetchie. I am sorry, First Minister. I thought that you had finished.

I am sorry, Presiding Officer. Amid all the slogans, I was asked a question.

The strategy is right and should be pursued. The strategy is supported by the vast majority of Scottish companies that know what is needed, and the strategy will work. The economic strategy is working already. In Mr Swinney's constituency there has been a reduction in unemployment of 22.5 per cent—nearly one quarter—in the lifetime of the Parliament. Employment in Scotland is higher than it is in most competitor European countries, so unemployment is lower. Growth in Scotland will be strong again. [Interruption.]

Order. We do not want a shouting match; this is not the House of Commons.

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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-2217)

The Scottish Cabinet will, as always, focus on the issues that really matter to the people of Scotland.

I hope that one of those issues will be the fact that came out recently that, last year, for the first time in 10 years, there was a significant increase in the number of pupils leaving our schools with no qualifications. Does the First Minister accept that that is a worrying statistic that shows that far too many of our young people are being let down by an education system that the Executive is far too timid to reform?

First of all, our education system is significantly better than most other education systems in the world, but our education system can be much better. That is why this week I have not only laid out new options for children who are leaving school without qualifications or with qualifications that are inappropriate for their future working life but set out other types of flexibility and other options that will be available earlier in their school lives to allow them to progress at a faster rate. That is the future for Scottish education—a comprehensive and ideal principle of equal access for all, but also a flexible system to ensure that each child has the educational opportunities that they need and deserve in the modern world.

Anyone who analysed the First Minister's speech earlier this week and that of the Minister for Education and Young People, Cathy Jamieson, would see that there has been a great deal of playing on words as to exactly what comprehensive education means in modern Scotland.

I give the First Minister a specific example of where we could do with more diversity, choice and flexibility, about which he and the Minister for Education and Young People are always speaking. Will the First Minister follow the lead of his colleagues down south and dramatically expand the number of specialist state schools in Scotland? England has more than 900, specialising in business, technology, science, maths, languages, sport and the arts, and that number is planned to double by 2006. Scotland has a paltry nine, with no increase in prospect. Is that what he means by extending diversity and choice, when there is no hope of change or diversity in our education system?

I am happy to talk about comparisons between the Scottish and English education systems. The systems are, of course, different. They come from very different origins and have very different bases today. That is why, in implementing the ideal of equal access, different ways of reforming the system are appropriate in each country, as the Prime Minister confirmed again this week. I would not hesitate to remind everyone in the chamber that Scotland has a far higher percentage of young people leaving school with higher grade qualifications or equivalent, a higher number of young people with degree level qualifications, and higher levels of numeracy and literacy. In all those areas, the Scottish system is strong, but it must be better still. I am not interested in a few centres of excellence opted out of the Scottish education system. I want every school in Scotland to be excellent, and that is what we will achieve.

Will the First Minister assure me that his Cabinet will focus on the growing threat to Scottish manufacturing from outgoing foreign firms, such as the global giant ABB, which has announced its intention to shut down in Dundee after almost 70 years of power manufacturing there, throwing more than 200 workers on to the scrap heap? Can he assure me that the economic strategy that he referred to will include the intention to use whatever financial incentives are available to the Government—regional selective assistance, the provision of custom-built factories or anything else—to support the campaign of workers in Dundee to change that company's mind and to show the world that manufacturing remains important to Dundee and to Scotland?

We will certainly discuss all those options with ABB. In fact, the relevant minister is meeting representatives of ABB later this afternoon, so there will be an opportunity to have further discussions. We must use all the tools at our disposal to ensure that we maintain the strong Scottish economy within the United Kingdom economy that provides stability for our current economic success. We must ensure not only that we have the skills and physical infrastructure that we require to make the Scottish economy successful but that we support companies through regional selective assistance and other measures, to help Scottish companies grow and to ensure a more sustainable future for companies from overseas that choose to invest in our country.

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Skills Gap

To ask the First Minister what the Scottish Executive will do to address the skills gap outlined in the "Futureskills Scotland" report. (S1F-2235)

The "Futureskills Scotland" report is a significant and thorough analysis of the Scottish labour market. It found that employers consider skills gaps within their work force to be a greater concern than recruitment difficulties because of skills shortages. That means that in-work training is crucial, and that will be reflected in our lifelong learning strategy, which will be published next year.

Does the First Minister agree that the establishment of Scotland's new labour market intelligence unit offers the prospect of matching the people who want jobs with the jobs in search of people, and that on the basis of evidence, not anecdote? Will he notice particularly the gaps not so much in the provision of technical skills but in the instilling of so-called soft skills? Will he consider how we can best work to get our educational and training systems to deliver on soft skills and, in doing so, to boost employment rates and increase productivity across the Scottish work force?

It is important that public agencies do what they can to match the jobs to those who need them and vice versa. We must also ensure that we get the right balance of skills in our economy and particularly among our young people. It is the soft skills that have been neglected in our education system in recent decades, and it is precisely those skills that the flexibility and innovation that is going on in our schools today will be able to support and develop in years to come.

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Regional Selective Assistance

To ask the First Minister whether, instead of wasting public money on celebrating the union of the Crowns—

No, Mr Neil. You must read out the question published in the business bulletin.

I am coming to that. My question is relevant.

No. You must—

If you will let me finish the sentence—

No. I will not, because you must stick to the question as published.

Well, can I ask—

Order. If you do not read out the question—

I want to ask the First Minister whether it is not wiser to spend public money creating new jobs—

I am sorry, Mr Neil, but I called you to ask question 4.

I apologise, Presiding Officer. I realise that I was trying to read out my supplementary to question 4. [Laughter.]

To ask the First Minister whether the Scottish Executive will review the criteria for regional selective assistance and other forms of support available to incoming foreign companies. (S1F-2212)

I assure you, Presiding Officer, that that was not my supplementary.

I cannot wait for the supplementary question—it will be as predictable as such questions from the SNP sometimes are. I hope that Mr Neil will join one of our literacy programmes—that might help us in years to come.

It is a numeracy programme that the First Minister wants.

At least we have enough members to count.

Regional selective assistance was reviewed last year to refocus our support on growing Scottish firms and higher-quality sustainable projects. Inward investment remains important to the Scottish economy, but I want growth to be based on high-value products that stem from increased knowledge, skills and research and development. Our support for business has been directed towards that strategy.

We will now have the impromptu supplementary question.

Rather than waste public money on celebrating the union of the Crowns and the union of the Parliaments, the latter of which in particular has cost us dear, will the First Minister use that money instead to create new jobs for those workers who were made redundant in Mossend and Dundee as a result of decisions taken by international companies? Will he tell us whether it is true that around £3.75 million was made available to Chunghwa for training, but that that money was never used for training? Will he give a guarantee that any moneys that are recovered from regional selective assistance funds will be reinvested in local companies to create local jobs, which are badly needed in Mossend?

There are two parts to that question. We have made it clear publicly that we are disappointed by Chunghwa's investment decisions since it came to Scotland; it has let people down badly. We will pursue Chunghwa for the regional selective assistance that it needs to pay back to Scotland and we will ensure that that money is properly reinvested in the development of the Scottish economy.

The Scottish economy contains a number of important parts as well as our manufacturing industry. There is the tourism industry too, as has been highlighted. In the tourism industry, there is three times more investment from UK visitors than from visitors from elsewhere in the world—our links with the rest of the UK are therefore important for our tourism industry. A derisory response to an open invitation to join together and ensure that we celebrate internationally in a variety of ways various events from our past was a tragic error. In future, I hope that the SNP will be led by somebody who recognises better the importance of Scotland's history in selling our country at home and abroad.

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Child Poverty

To ask the First Minister what steps the Scottish Executive is taking to eradicate child poverty. (S1F-2229)

I want to live in a Scotland in which all children can reach their potential by ensuring that opportunities are available to all. That is why the Scottish budget contains measures to tackle child poverty through supporting vulnerable children in their early years, delivering excellent education and health services and investing in decent housing and communities.

Does the First Minister agree that the particular needs of rural areas should be considered when child poverty action plans are being produced? Does he recognise that poor public transport and the lack of child care provision prevent many parents in rural areas from seeking paid employment?

Child care and transport are as fundamental issues in relation to employment in Scotland's rural areas as they are in Scotland's urban areas. Much catching up must be done in respect of child care and transport in many parts of rural Scotland. That is why we include a calculation for rurality as part of the distribution formula in the allocation of our child care grant and why we are putting so much resource into the rural transport fund. That will ensure that rural transport projects are available to get people to work at the locations where they need to be and that their families are looked after while they are at work.

Will the First Minister be honest Jack today and acknowledge that child poverty has not been reduced since the coalition came to power? Will he further acknowledge that it is only by joining the consensus in Scotland for the Parliament to have economic powers that we will ever make a difference?

Levels of absolute poverty have dropped dramatically in Scotland in the years since 1997. The tens of thousands of Scottish children who benefit from the reduction in absolute poverty are children who are better served today than they were five years ago. That should be recognised by the SNP as well as by us.

It is vital not only that we reduce levels of absolute poverty in Scotland but that we close the gap between those of us who live more affluent lives and those who live on the poverty line. That is why, certainly initially, we are targeting children who are in families in the poorest communities and the poorest homes. They have to be targeted to ensure that they can rise out of that and have the opportunities in life that we want for all Scottish children.