Meeting of the Parliament

Meeting date: Tuesday, October 8, 2013

Official Report 792KB pdf

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Topical Question Time

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Grangemouth Refinery (Industrial Dispute)

1. To ask the Scottish Government what discussions it has had with INEOS and Unite the Union regarding the dispute at the Grangemouth plant. (S4T-00469)

The Scottish Government has had a number of discussions with senior management at INEOS and the trade union Unite over the past few weeks in relation to the inquiry into the conduct of a trade union official, pension negotiations and the long-term future of the site. We will continue those active discussions in the days ahead. We are disappointed that the discussions between INEOS and Unite have yet to resolve the issues, and we urge the union and INEOS managers to work together to achieve a settlement. The Scottish Government will do all that it can to assist in resolving the outstanding issues with the objective of securing the future of the site.

I thank the cabinet secretary for his detailed reply and for the work that he has done on the issue to date. I, too, have held meetings with INEOS management at Grangemouth and hope to meet Pat Rafferty of Unite in Falkirk tomorrow. The threat by INEOS to close the petrochemical plant by 2017 has created a degree of nervousness and anxiety in the local community, as such a move would have a major impact in the Falkirk district and in Scotland as a whole. Is the cabinet secretary optimistic that, if all parties get back round the table and discuss all the issues, there is light at the end of the tunnel and the investment that is required for the plant can be found?

I agree whole-heartedly with Mr MacDonald that the INEOS petrochemical plant is a substantial contributor to the Scottish economy and particularly to the economy of the Falkirk district. Its significance for employment and economic impact cannot be overstated. As a consequence, the Government is spending a great deal of time and effort in trying to encourage and support the parties to come to some agreement on the outstanding issues. I think that there is the basis for an agreement, based on the point that I made in my original answer that the Government’s objective in supporting the discussions is to secure the future of the site. From the discussions that I have had, I believe that that is also the position of the INEOS management and Unite. I hope that, through collaborative discussion, we can encourage the resolution of the issues and concentrate on securing a strong long-term future for the INEOS plant.

INEOS recently started marketing its spare land on the site to attract new businesses associated with the petrochemical industries. Indeed, we will discuss one of the options for that in the chamber on Thursday afternoon. Given that INEOS has previously stated that

“there is no plan B”,

does the cabinet secretary agree that, with commitment from INEOS, Unite and both Governments, the future for Grangemouth as a major contributor to the Scottish economy is a positive one? Will he undertake to keep me, as the local constituency member, informed of any progress between management and the unions?

I undertake to keep Mr MacDonald, as the local member, informed of developments, and I will keep Parliament informed of any developments that involve the Government’s action. I agree that there is a basis on which the site’s future can be secured, which involves investment by the company, the participation of a very strong workforce and support from both the Scottish and United Kingdom Governments. I have had active discussions with the UK Government to ensure that it understands our perspective on the issue and that we understand its perspective. That has resulted in a very productive set of discussions with the UK Government. We will continue with those discussions and interventions to support the creation of a long-term future for the INEOS plant.

I draw the chamber’s attention to my entry in the register of members’ interests, which shows that I am a member of Unite.

It is clear that the current dispute is both holding up and potentially prejudicing the important and potentially difficult discussions that must take place about the long-term future of the INEOS plant. It is also clear that those discussions cannot take place until two things happen. First, the union must end its industrial action and, secondly, the company must end the disciplinary action that is currently under way against a trade union convener at the plant. I realise that this is an unusual intervention to ask for but, in the light of the far bigger issues at stake, will the cabinet secretary use his good offices to achieve both those things?

I agree with Iain Gray’s analysis that the issues around the consideration of a disciplinary case against a trade union official are hampering the substantive discussion, which is about the sustainability and future of the plant. That substantive discussion must be embarked on to ensure that those issues can be resolved in due course.

I give Mr Gray an absolute undertaking that ministers will continue to take all the steps that we can to encourage and facilitate the focusing of the discussion on the substantive issues. The obstacles of the consideration of a disciplinary case and the industrial action need to be resolved to allow us to proceed. That is very much the approach that the Government is committed to taking. I will happily keep Parliament informed of developments in that respect.

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Local Government (Powers and Finance)

2. To ask the Scottish Government what consideration it is giving to the future of local government powers and finance. (S4T-00474)

We remain committed to a partnership with local government to realise the benefits of integrated and improved services by using the powers and the finances that are available under current constitutional arrangements. That includes strengthening our collective efforts to mitigate, where possible, the impacts of the United Kingdom Government’s welfare reforms.

The powers of independence would provide the opportunity for a new relationship between the Government and local authorities to fully address the needs and aspirations of our local communities, and for the status and rights of local government to be recognised in a written constitution. Powers and structures are only one part of our journey towards achieving better outcomes as we empower communities, build on the assets within them and strengthen partnership working to renew local service delivery.

I agree with the cabinet secretary that powers and structures are only one aspect of the debate, but there is a growing appetite for a real decentralisation of power in Scotland and a reinvigoration of local democracy and local democratic participation. In addition, we are dealing with a local government structure that is financed on the basis of absurdly out-of-date valuations of properties.

Does the cabinet secretary agree that, whatever the result of next year’s referendum, we must avoid the risk that in the next session of the Scottish Parliament the Parliament will again be deadlocked on the issue of finding solutions to reform local government finance? Does he agree that avoiding that risk is a priority?

I agree whole-heartedly with Mr Harvie’s argument about the necessity of decentralising power in Scotland. I presided over the agreement of the concordat with local government in 2007, which transformed the nature of the relationship between national and local government and reduced—over the space of about five years—the level of ring fencing in Scotland to the extent that it now amounts to an extremely small proportion of the local government settlement. When we came into office, ring fencing totalled in excess of £2 billion out of the local authority settlement. Reducing ring fencing in that way gave local authorities significant flexibility to determine their own priorities.

I understand the aspirations of people in local government to debate and consider the future of local government. The Scottish Government has made it clear that we welcome that and think that it is a constructive contribution to the debate. It is a debate that we will engage in. That is why, for example, in Lerwick during the summer, the First Minister set out the approach that the Government would take to local decision making in our island communities. It is why the Government has worked so hard to ensure that the dialogue that we have on legislation on community empowerment, for example, enables us to reinvigorate the sense of community participation in our society, which all of us—especially ministers—recognise to be an important bedrock of the structure of democracy in Scotland.

Although there are aspects of that answer that I welcome, it slightly sidesteps the issue of local government finance reform. The current Scottish National Party Government has its policy on what it would like to do to replace council tax, and I gather that the Labour Party is consulting on options for what it might support as a replacement for council tax. My party is clear about its policy. Surely we have to avoid another session of the Scottish Parliament in which we do not have a clear political way forward on the issue. Having another deadlocked Parliament on the issue would be a genuine problem. Is it not now time for a bit of calm, cross-party discussion that includes those in local government and from across the political spectrum to find out how we can avoid the danger that we will have yet another session of the Scottish Parliament in which we do nothing to reform local government finance?

I have two points to make on that, the first of which relates to the nature of the dialogue. I am all for having calm, cross-party dialogue on such questions, which I think can help advance our consideration of them, but I am also in favour of parties remaining faithful to the commitments that they made to the electorate when they were elected. We were elected in 2011 on a commitment that we would consider the approach to local taxation during this parliamentary session. We accepted that we were unable to reach consensus on that in the previous session—I think that that is a fair reflection of the position in the 2007 to 2011 session—so we made a commitment, which we will fulfil, to have that dialogue in this session.

Secondly, we should be clear about the nature of the financial support that has been given to local government in Scotland, because it has fared better than the Scottish Government has done in the funding settlements that we have put in place. Resources for local government have risen at a faster rate than those for the Scottish Government. That demonstrates the degree of commitment and priority that the Government gives to funding local authority services properly. Of course we can have a discussion about the approach to local government finance. The Government will do that by fulfilling its manifesto commitments, which of course also include another important commitment to the public: to freeze the council tax during this parliamentary session, which we continue to do.

When will the cabinet secretary bring forward the SNP’s local income tax proposals for wider consideration in the chamber? Does he not consider that the financial sustainability of local government services has to be discussed by all of us across the chamber now, given that we have lost 40,000 public service jobs over the past few years and given the pressures that the Christie commission highlighted for all of us to address?

The Scottish Government accepted the Christie commission’s strong and valid conclusions, and we have embarked on a process of public sector reform that I think is now gathering significant pace and delivering improvements to the services that the public experience. It is improving the outcomes that are achieved for members of the public in Scotland. That has been done despite the fact that we are under enormous financial pressure. That is happening because public servants are working in a collaborative way across boundaries and disciplines with the Government under the umbrella of the Government’s programmes to improve the services that are put in place for members of the public.

I can only infer from Sarah Boyack’s comment about the loss of employment in public services that she is suggesting that we should somehow re-employ the individuals involved and pay for their services. Again, we are back to the hard realities of where the Labour Party fails in its contribution in Parliament, because we cannot employ people if we do not have enough money to pay for them—that is a simple, basic line of arithmetic. It is beyond me that I have to keep on reminding the Labour Party that we cannot employ people whom we cannot afford and that we must live within our means in this parliamentary session. What we are doing is ensuring that the resources available in Scotland are improving the outcomes for people in our country.

On the question of local finance reform, the Scottish Government will fulfil its manifesto commitment to open up the discussion during this parliamentary session to seek broader agreement around local taxation. The Labour Party is very welcome to contribute to that process, once it makes up its mind what its position is.