Finance, Employment and Sustainable Growth
Business Rates (Review)
The Scottish Government intends to review business rates later this year.
In that review, what does the minister intend to do with the small business bonus scheme, which has been extremely popular with small businesses and from which many of them have derived significant benefits? Does he foresee the scheme having a key role going forward?
The review will consider how the business rates system can better support business and economic growth. It will cover a range of issues, including the effectiveness of current tax breaks—worth more than £540 million this year—rating appeals, transparency, tax avoidance and other matters. However, we have committed to continue the small business bonus scheme for the lifetime of this session of Parliament, thus providing a lifeline to more than 85,000 small business premises across Scotland.
I ask the minister to consider a situation that arose in a number of places in Scotland, but particularly in Ballater in the north-east where a revaluation resulted in businesses going from receiving a 100 per cent discount under the small business bonus scheme to receiving no discount at all. Is there a means by which small businesses can in the future be protected from such changes?
I confirm that such matters can feature as part of the review that we are about to conduct.
Public Sector Pay Levels (Temporary and Agency Staff)
We do not directly take into account the pay of temporary and agency staff when considering public sector pay policy. In taking decisions on public sector pay levels, we look at the impact of each of the elements of the pay policy on the wider public sector as well as those bodies that are directly subject to the pay policy.
I thank the cabinet secretary for that response. I welcome the decision by the Scottish Government to ensure that all directly employed employees are paid the living wage.
I confirm that, in relation to employment arrangements, the Government’s preference is not to encourage the use of temporary and agency staff. We prefer to have employment arrangements that are structured around permanent employees. I am sure that Mr Park would welcome that.
Business Improvement Districts
Business improvement districts such as those in Inverness and Elgin enable the private and public sectors to work together and invest in improvements to the local business environment while contributing to the wider regeneration of the local community. Businesses also benefit from the sharing of good practice across BID areas.
The minister may be aware that, in Argyll, Oban businesses are currently voting on whether to establish a BID in the town, with the result of the postal ballot due in early October. Will he join me in paying tribute to the BID4Oban team, who are seeking support from their fellow businesspeople for their positive proposal? Does he agree that a BID in Oban has the potential to boost the local economy and support local retailers, as has happened through BIDs elsewhere?
Yes, absolutely. The Scottish Government concurs with those words. A number of BIDs are being developed—18 are at the development stage, six of which are in Mr McGrigor’s constituency. I hope that the Oban result is positive, leads to change and further contributes to the agenda to regenerate that community through, for example, the CHORD—Campbeltown, Helensburgh, Oban, Rothesay and Dunoon—programme .
The minister is obviously aware of how the BID process and setting up a BID can benefit a community. Jamie McGrigor expressed very eloquently how a BID can support Oban. Hamilton, too, is going through the BID process and its ballot deadline is 11 October. I extend an invitation to the minister from the Hamilton Chamber of Commerce to visit Hamilton just before the ballot deadline in order to lend his support.
I confirm that we support that BID proposal. I support it personally and, diary permitting, I will try to make the deadline for the ballot. I look forward to a positive outcome. I hope that BIDs will help to regenerate communities such as Hamilton.
Tourism Promotion (West Scotland)
The west of Scotland is promoted throughout VisitScotland’s suite of marketing activity, including on the organisation’s national tourism website, which receives circa 13 million visits annually.
Last weekend, I attended a few of the doors open day events in Inverclyde—I am sure that colleagues from across the chamber did the same in their parts of the world. I was disappointed that Newark castle in Port Glasgow was not involved this year, although it has been involved in previous years. I ask the minister to speak to Historic Scotland and to encourage it to reconsider that decision for future years, please.
I thank the member for advance notice of the content of his supplementary question. Doors open day gives visitors free access to hundreds of fascinating buildings throughout Scotland that are normally closed to the public, such as the Irn Bru factory, which members may be interested in visiting. The point of the event is to open the doors of buildings that are normally closed to the public. I am advised that Newark castle is already open to the public seven days a week from 1 April to 30 September and that it was for that reason that Historic Scotland decided not to include it in this year’s event. I take the opportunity to recommend that colleagues pay a visit to Newark castle before 30 September.
Retail Sales and High Street Footfall (Scottish Borders)
The Government takes a number of steps to support Scotland’s retail sector through actions such as the small business bonus scheme and other reliefs, which provide zero or reduced business rates for 63 per cent of retail premises in Scotland. The Scottish Government is also working to provide support for our town centres. On 9 September, the Deputy First Minister announced details of the Scottish Government’s national town centre review. As part of that review, we are working with the Scottish Retail Consortium to consider the role of the modern town centre in 21st century Scotland.
Towns such as Selkirk and Duns in my constituency have seen drops of up to 30 per cent in footfall on their high streets. Retailers are crying out for more help from the Scottish Government but, instead, the Government is hitting them further with damaging measures such as the SNP’s retail tax, which has led to a £95 million increase in business rates. Will the Scottish Government finally take real steps to help Scottish shops and high-street businesses and stop that hugely damaging measure?
It is some years—to my shame—since I have been in Duns, but I cannot imagine that many properties there will be paying the Government’s public health supplement. If I am incorrect, Mr Lamont can correct me, but as he is not doing so I think that I am on safe ground.
Budget (Block Grant Reductions)
Within the financial constraints that have been imposed, we are maximising the impact of our spending on the economy, jobs and improving public services. Subject to further detail in next week’s draft budget, I can outline our approach.
I look forward to seeing the detail of the budget in the coming weeks. If Westminster finally gave the go-ahead to the Scottish Government’s list of shovel-ready projects—including the University of Glasgow centre for virology research, which has been proposed for the Garscube estate in my constituency—how much of an impact would that have on construction and employment in Scotland?
The Government has estimated that the list of projects that we have proposed to the UK Government would, if applied, have the effect of supporting more than 4,000 jobs. We estimate that approximately 60 per cent of those jobs would be in the construction sector.
Question 7 has not been lodged, for understandable reasons.
Construction Projects (United Kingdom Government Approvals)
As I said in my answer to Fiona McLeod, if the projects on the list that the Government has provided were taken forward, they would provide an immediate boost to the construction sector and the wider economy by supporting more than 4,000 jobs. They would help to kick-start wider private sector investment and provide a double benefit to the economy: a short-term benefit from the building of the assets and a long-term benefit from their use.
In my constituency of Midlothian North and Musselburgh, even a small proportion of the work related to the £300 million of shovel-ready projects would help to kick-start the local economy, which relies substantially on construction-related projects for its prosperity.
One point that I will make to Mr Beattie in agreeing with the thrust of his question is that, this morning, my first engagement was with the Fife economy partnership, involving a range of members from the Fife Chamber of Commerce. As regards the concerns expressed at that event about the health of the construction sector, it was clear to me that the type of investments that Mr Beattie talks about are of real relevance in stimulating local economies.
I ask Mr Swinney what the impact has been on the Scottish economy—on joblessness in particular—of his decision as finance minister to cut £86 million from the housing budget.
I am surprised that Mr Macintosh has returned to that territory after the explanation that the Deputy First Minister gave him so forcefully yesterday.
Construction Sector (Stimulation)
In the face of United Kingdom Government cuts to the Scottish capital budget of over 30 per cent, the Scottish Government is maximising its capital expenditure to support infrastructure investment and jobs across Scotland. We are switching more than £700 million from resource to capital spending over the spending review period. We are also taking forward a new programme of non-profit distribution investment worth £2,500 million. As a result, total capital spending will be more than 25 per cent higher in 2014-15 than in 2011-12.
In the past few months, as the minister will know, my constituency has—among other setbacks—lost more than 500 jobs at W J Harte Construction Ltd. It has recently seen Laing O’Rourke Construction Ltd decide to close its Bison concrete plant, where it makes an array of products for the construction sector.
We certainly agree and are acutely aware of the difficulties that the construction sector faces across Scotland. Michael McMahon knows that we make every effort to engage with businesses; we will certainly do so in the Terex case since he has raised it in the chamber. I undertake to look personally into that case and to report back to him as quickly as possible.
Remploy
Scottish ministers and officials are in regular contact with the United Kingdom Government regarding the future of Remploy factories in Scotland. I have been engaged directly in dialogue with Maria Miller, the former UK Minister for Disabled People. Following the UK Cabinet reshuffle, the new minister, Esther McVey, will meet me during a visit to the Scottish Parliament in October.
The minister will be aware of my on-going concerns about the sales process for Remploy Springburn and how workers and unions have been treated. Does the minister agree that, with the new minister Esther McVey MP now being in charge of disability issues at UK level, the UK Government has the opportunity to rethink its approach, to guarantee workers’ rights under the Transfer of Undertakings (Protection of Employment) Regulations, and to reconsider the detrimental pension and redundancy conditions? When he meets the minister, will he make such representations to her, as I have done?
Bob Doris has raised the issue of Springburn in his constituency and members from all parties have raised the plight of the Remploy workforce. I cannot think of any workforce that is more deserving of our support, or that is more vulnerable, than the Remploy workforce. At all stages of the process, we have made crystal clear our views about the UK Government’s decisions, and we adhere to those views. Our duty now is to do the very best with the situation as it is, rather than as we would prefer it to be. We will continue to do everything possible to assist the workers who are affected in Remploy factories throughout Scotland—not only those who are in phase 1 and who face the prospect of immediate redundancy, but those in other factories whose futures are uncertain. I am sure that we will come back to the issue many times in this chamber in the months ahead.
I thank the minister for his support, but he will be aware that the leader of Scottish Labour has written to him to ask whether it would be possible for the Scottish Government to consider a range of measures, like those that have been proposed by the Welsh Assembly Government, such that employers who wished to take on redundant ex-workers from Remploy would be assisted to do so for up to four years in order to carry out any necessary modifications to their premises and to see to other related matters. The minister might not be aware that I have written to the Equal Opportunities Committee to ask that it undertake an inquiry into the entire issue of Remploy because—as Bob Doris rightly said—there are a number of issues about how the process has been carried out. Does the minister intend to agree to Ms Lamont’s proposals, and will he back my proposals?
I am afraid that I am not aware of all those matters. In particular, I am not aware of any detailed proposals having been received, but I say to Patricia Ferguson that I undertake to look into that and at any correspondence that has been received, and to reply as swiftly as possible.
Planning System (Performance Improvement)
We are determined to see an improvement in performance across Scotland and we have already worked closely with planning authorities on the new planning performance framework. Authorities’ first performance reports are due this month and we will discuss with them the implementation of their service improvement priorities.
Although councils at times create difficulties through the way in which they interpret planning guidelines, it is also the case that being at the coalface gives them a feel for how the system might be simplified and improved. Will opportunities be afforded to individual local authorities to feed into the process of reform, or will the Scottish Government engage only indirectly via the Convention of Scottish Local Authorities?
A range of activities can be undertaken to ensure that individual local authorities’ voices are heard, including through the professional organisation Heads of Planning Scotland, through the continuing consultation “Planning Reform: Next Steps”, through the national planning policy framework and through the performance framework. There is a range of ways in which local authorities can contribute their views on how planning can be shaped to support sustainable economic growth in Scotland.
The minister will be aware that Eric Pickles announced in the House of Commons last week the intention south of the border to relax certain planning laws, including a temporary suspension of certain requirements. Has the minister considered whether those steps would be appropriate in Scotland, given that they could boost the economy and construction and, by reducing councils’ workloads, perhaps improve their efficiency?
I inform Mr Johnstone that I will return to Parliament next week with a comprehensive statement on planning matters. It will show that, once again, the Scottish Government is ahead of our United Kingdom counterparts on matters such as planning and supporting economic recovery. We will, of course, examine whatever measures are announced in England or other places and ensure that we have a competitive edge. I am sure that Mr Johnstone will listen carefully to my announcement to Parliament next week.
West Scotland (Additional Funding)
Sustainable employment is critical to addressing disadvantage and poverty. The Scottish Government is providing a range of funding to local authorities in West Scotland to support that. This year, local authorities in the region received £599,241 specifically to support the delivery of opportunities for all, including 16+ learning choices and activity agreements.
Does the cabinet secretary agree that cutting the revenue allocation to Renfrewshire Council, which received the fifth-worst cut, will have a serious impact on services on which the most disadvantaged people depend?
As Mary Fee will know—and as I think I explained to her and her colleagues Jim Sheridan MP and Douglas Alexander MP on what we might call the picket lines of the Cabinet meeting in Renfrew—Renfrewshire Council’s funding settlement is driven by the local authority distribution formula that is agreed by all local authorities through the Convention of Scottish Local Authorities. Although it is essentially a population-based formula that predominantly structures the amount of resources allocated to individual localities, it takes due account of deprivation, rurality and sparsity of population, in certain cases, and of a variety of other indicators in order to arrive at the fairest distribution of resources around the country. The mechanism was last reviewed in the spending review and was signed up to by all local authorities in Scotland.
Public Sector Pension Reform
In March 2012, we entered in good faith into negotiations with stakeholders to develop pension scheme designs that are appropriate for Scottish circumstances. Since then, the UK Government has indicated that it intends to use its forthcoming public service pensions reform bill to prescribe a number of significant constraints to that process. That has changed the context of our negotiations significantly, so I am actively pressing the UK Government for further clarity as a matter of urgency.
Is the cabinet secretary able to tell us the issues on which the UK Government has not provided the clarity that he is seeking, and how they might impact on the ability to negotiate?
As I have indicated, the issues are the subject of active correspondence with the Treasury. I wrote to the Chief Secretary to the Treasury most recently on 7 September—one of a number of letters that I have written seeking clarity on these points.
Long-term Unemployment
The range of actions that the Government is taking on the issue of long-term unemployment is captured in its budget proposals and capital programmes. We will shortly publish our refreshed employability framework, which seeks to better align services for people who are out of work and thus help them to overcome their barriers to employment. We are also investing £64.6 million of European social funds to support employability initiatives worth £168 million in some of the most disadvantaged parts of the country.
I thank the cabinet secretary for quite a broad-brush reply to what was, in fairness, a broad-brush question. However, the devil is often in the detail. In my constituency, the number of people who have been claiming jobseekers allowance for more than 12 months has almost doubled. Today’s unemployment figures mean that that situation is unlikely to have improved. Behind that detail, figures that were released yesterday showed that East Lothian and East Renfrewshire had recorded the largest rises in female unemployment over the past four years—rises of more than 275 per cent.
The Government recognises the seriousness of the issue that Mr Gray raises. Yesterday’s debate, the updates to our economic interventions and the variety of different interventions that the Government is making to support people to enter the labour market and, particularly on capital investment, to support the economy in order to create job-growing projects, will all assist in stimulating the economy and encouraging people back into employment.
Payday Lending (Regulatory Regime)
In April, I wrote to the UK minister Norman Lamb seeking greater regulation of payday loans and urging the UK Government to consider a cap on interest rates for high-interest and payday lending.
Veritec, a US software company, provides a small credit database to a number of US states and to Australia. That system allows high-street lenders to check whether customers have loans from other lenders and allows states to regulate payday loans, cap them and prevent them from rolling over, thereby protecting consumers from creating huge debts. In the light of the proliferation of high-street lenders, will the minister suggest that UK Government consider a similar system of regulation?
I am particularly interested in the idea that there is a technology that can detect whether individual potential borrowers already have previous debts. That should be explored.
I regret that we are unable to take any more questions.