Engagements
To ask the First Minister what engagements he has planned for the rest of the day. (S4F-02249)
Engagements to take forward the Government’s programme for Scotland.
Yesterday, the governor of the Bank of England said:
“Uncertainty about currency arrangements could raise financial stability issues.”
The First Minister is not getting his currency union—an option that Jim Sillars called “stupidity on stilts”—and is now implying that he will use sterling without agreement. John Swinney hints that a separate Scottish currency will be used, while Dennis Canavan specifically backs one. The First Minister’s former adviser Professor John Kay says that it would be stupid for him not to have a plan B.
Mark Carney talks about confusion with the currency. Can the First Minister tell us where that confusion could be coming from?
I welcome yesterday’s statement by Mark Carney, which I think was a very effective statement to calm the financial markets and speculation. We should all appreciate the fact that, in fulfilling his responsibilities, the governor of the Bank of England made it clear that the duties of the Bank of England would be fulfilled. That was excellent.
I also welcome the fact that Mark Carney reiterated that the suggestion by some in the no campaign that he was against a currency union was not true and that he had not said that. He has now reiterated that a number of times. The Bank of England, quite properly, is neutral on the matter and will implement the proposals that are agreed.
Johann Lamont asked where the uncertainty comes from. Might it be because the United Kingdom Westminster parties seem to have a vested interest in causing as much uncertainty as they can? If that is not the case, why—of all the subjects on which they said that they would not pre-negotiate—have they combined to rule out the proposal for a currency union? Was that not about trying to create uncertainty? I welcome the fact that, thankfully, the Bank of England governor has moved to put an end to the unionist campaign’s plans.
The First Minister may, as usual, impugn the motives of the Westminster parties, but it is not the leaders of the Westminster parties whom the women of Scotland are describing as dishonest. They also describe the First Minister as arrogant, and they describe Nicola Sturgeon as ambitious—but we knew that last week.
The First Minister needs a reality check, because he welcomed Mark Carney’s statement, but he did not listen to what it said. Let us look at what was actually said yesterday. The governor of the Bank of England made it clear that a crucial element of sharing a currency is sharing fiscal risk. He said that there would need to be
“some form of fiscal arrangements.”
In response, the First Minister told Jackie Bird last night:
“What we will control is 100 per cent of our fiscal policy.”
That is simply not true. No, we would not. Mark Carney says that we would not. Is the First Minister not deliberately misleading the people of Scotland on the fundamental issue of the currency?
In relation to the suggestion that I made that the unionist parties were trying to create instability, I will cite what the principal of the University of Glasgow, Professor Anton Muscatelli, said in an article in the Financial Times. He said:
“The most damaging prospect to the rest of the UK from rejecting a sterling currency union is what it will do to its own trade and business activity. Whatever the political tactics involved, it would be tantamount to economic vandalism.”
Therefore, it is not just the yes campaign that detects from the behaviour of the no campaign a deliberate attempt to create uncertainty and fear; the academic observers, the impartiality of whose commentary on these matters cannot be impugned, detect exactly the same thing.
As far as the Survation poll is concerned, I suppose that we have an opportunity each month to look at the Survation poll to find out what did not seem, for some apparent reason, to get into the Daily Record poll. I think that the answer might be on page 10 of the poll document. The 1,000 women who were polled were asked their voting behaviour. The poll found that the Scottish National Party could expect support from 43 per cent of the women, whereas the Labour Party could expect support from 27 per cent.
Many people consider it unlikely that the SNP could ever repeat the landslide of 2011 but, according to the Survation poll that Johann Lamont seems to be so pleased about, SNP support among women has increased since then and Labour support has declined. If there was an election now, on the basis of the poll of women voters—it is only one poll, but they are a very important part of Scotland’s population—the SNP could expect to have even more MSPs and the Labour Party would have considerably less.
And they wonder why people call the First Minister arrogant. He did not answer the serious question that he was asked about the currency.
The First Minister quoted one person. I would be here all day if I quoted all the independent experts who say that his lack of a plan B is creating grave uncertainty for families across the country.
John McFall, a former chair of the Treasury Select Committee—[Interruption.]
Order.
Forgive me—we are supposed to quote only people who agree with the First Minister. Sadly for him, in a democracy the rest of us are entitled to an opinion.
John McFall, a former chair of the Treasury Select Committee, said:
“Governor Carney was asked specifically about the potential of capital flight in the event of independence and said that he has contingency measures.
It’s clear that the Bank of England is putting plans in place to prevent a run on Scotland’s banks that would be caused by Alex Salmond’s complete failure to set out a credible position on currency. This would put the livelihoods of millions of Scots at risk.”
Does the First Minister care that his plans for separation could lead to the devastation of the Scottish economy? Is Andrew Large, a former deputy governor of the Bank of England, right when he describes the First Minister’s currency plan as a “huge deception”?
Rather than quote John McFall—he is an estimable man, but he is a Labour politician—on what Mark Carney said, why do we not quote Mark Carney directly? I welcome what Mark Carney said yesterday, because he was impartially fulfilling his responsibilities as the governor of the Bank of England to calm financial markets.
Johann Lamont suggests that all this uncertainty has nothing to do with the better together campaign. She did not like the quote from Professor Anton Muscatelli, the principal of the University of Glasgow, so shall we quote the better together website? Of course, better together has no interest in creating instability or fearmongering and no interest whatsoever in project fear.
The better together website says:
“Financial market speculation could lead to capital flight and higher interest rates. Ultimately, if markets weren’t calmed, Scotland”
would
“have to adopt its own separate currency in a time of crisis.”
Johann Lamont and the better together campaign are trying to create uncertainty. They tried to create uncertainty on inward investment but, unfortunately, that has moved to an all-time high since 1997. They tried to create uncertainty on jobs—they said that jobs would be lost because of the referendum—but Scotland now has a record employment figure and a record figure for women’s employment.
Just as the attempts on inward investment and jobs failed, so will the attempts to generate instability in the financial markets, thanks to the resolute intervention and action of the governor of the Bank of England—the person who is charged with a responsibility, which he has fulfilled. I welcome Mark Carney’s intervention.
The First Minister must understand that his prospectus for independence, without knowledge of what the currency would be, is what is creating uncertainty. Only the First Minister would blame those who point that out to him as being those who are causing the uncertainty. The rest of us want the best option for the people of Scotland: keeping the pound—[Interruption.]
Order.
Keeping the pound in a currency union with economic stability and political representation within the United Kingdom—that is the best option. That is why the majority of doctors, the majority of women and the majority of the people of Scotland are proudly voting no to protect families across the country and in the future.
The governor of the Bank of England was answering a question about savers taking their money out of Scottish banks and investing it in other countries because Alex Salmond cannot tell us what Scotland’s currency would be after a yes vote.
Mark Carney clearly thinks that the risk is real, because he has revealed that the Bank of England has contingency plans for it. Before the financial crisis hits—[Interruption.]
Order.
If it was only their own future that SNP members were putting at risk, we would expect that kind of answer. This is a risk for families and their futures across the rest of the United Kingdom and in Scotland, and it deserves better than cat-calling from SNP back benchers.
Let me ask the question again. Before the financial crisis hits, should the First Minister not end the currency uncertainty by simply telling us: what is his plan B?
The point about scaremongering has just been made for me by Johann Lamont’s question.
Of course, we should all bow to the Labour Party’s expertise on financial crises hitting. We should remember that the financial crisis was analysed by the former governor of the Bank of England, Mervyn King, who said that the failure of the Labour Government to act made the financial crisis much, much worse. Financial crises are not the strongest suit of the Labour Party or of Johann Lamont.
What is certain is that the governor fulfilled his responsibility yesterday in seeking to ensure that he was doing his job and fulfilling his responsibility by stopping the instability that I believe is caused as a deliberate campaign tactic by the unionist parties.
I pointed out that the unionist parties said that inward investment was going to be deterred—it has not been. They said that jobs were going to be lost, but we have record job numbers. Just as those tactics have failed, so will all the tactics.
Johann Lamont asks what currency we will use. We shall use the pound. That is why we have made it clear and why we are adamant. We are saying that because we do not want to get drawn into the game of the unionist parties, which are attempting to create instability.
I welcome the intervention by the governor of the Bank of England. Another of the unionist campaign’s foxes has just been shot.
Secretary of State for Scotland (Meetings)
To ask the First Minister when he will next meet the Secretary of State for Scotland. (S4F-02247)
No plans in the near future.
The First Minister has heroically tried to spin the words of the governor of the Bank of England as a win for him. They are not. We are the side that is advocating the best solution for Scotland, which is keeping the pound in its current stable form. We are the side that backs our banks having a trusted lender of last resort and we are the side that knows that you cannot get divorced and still keep the joint account.
The First Minister is the one who is throwing a hand grenade into that mix. He is the reason why the governor is now being forced to prepare contingencies, and he is the reason why the headlines this morning are talking about capital flight and chaos. He demands independence and claims that nothing will change, but when there is a fallout he protests that somebody else should have to clear it up.
We know that the First Minister hates taking responsibility for anything, but is he really suggesting that this is the fault of everybody else?
No, I am suggesting that it is the responsibility of the no campaign, which is deliberately trying to create instability as a campaign tactic. I am not blaming other people—I am allocating that responsibility to the Labour Party and the Conservative Party, and their alliance in the no campaign. I am applauding the action of the governor of the Bank of England in fulfilling his responsibilities and recognising that those responsibilities continue after September 18. That is exactly what a governor of the Bank of England is meant to do.
For the unionist parties to deny, given the evidence that I have quoted, that they are engaged in trying to engender fear and instability is extraordinary. Why did the Chancellor of the Exchequer say that there would be no inward investment? Why did the Conservative Party say that there was already a loss of jobs? Is the evidence not that that scaremongering has been confounded, just as the attempt to create instability in the financial markets will be confounded as well?
The issue for the First Minister is that he knows that the currency union that we have right now—one that works only because we are part of the United Kingdom—is the very best option for Scotland. The stability and security of the UK pound is trusted and understood the world over and that is why he is desperate to salvage as much of it as he can.
The First Minister’s problem is not that he does not get it; it is that he cannot sell it. Every option that he has on the table—from a currency deal without a willing partner to sterlingisation or an 18-month transition to who knows what—is less than we have now and the people of Scotland understand that. Why should we settle for second best on the currency when a simple no vote will let us keep everything that we already have?
Well, I have to say that the people of Scotland who are watching will not believe that a David Cameron Government is worth keeping for Scotland.
We have had substantial evidence from the social attitudes survey that having a sterling union is the overwhelming choice of the Scottish people. We have also had—[Interruption.]
Order.
We are advocating a currency union because we think that it is in the best interests of the people of Scotland. A majority in that survey also believe that that is what will happen after independence, and they are right to believe that, because we know the consequences of the unionist parties attempting to keep all the financial assets of the UK for themselves. If they keep the financial assets, they end up with the liabilities—they end up saddled with the UK’s debt.
It is incredible, as we discussed last week, to believe that George Osborne or Ed Balls wants to say, “We are not going to take the up to £5 billion a year that the Scottish Government has responsibly said it will finance”—our share of the UK debt—“We don’t want that. We will saddle it on English taxpayers.” That is the inevitable consequence of the refusal to countenance the currency union.
Then we come to where people will say the decisions should lie. I thought that, when we had Jackson Carlaw manning the barricades and the comment from Ruth Davidson—which we all know, incidentally, was that she would support a currency union if it was in the best interests of the Scottish people—we had an acknowledgement from the Conservatives that they regarded the vote and verdict of the Scottish people as important.
I say to Ruth Davidson that, on September 18, if people in Scotland vote for what is in the white paper and the proposals to keep the pound, that is exactly what will happen and any Scottish politician who does not recognise the sovereign choice of the Scottish people will pay a heavy price. Incidentally, that is something that the Conservatives are long used to in political campaigns in Scotland.
Cabinet (Meetings)
To ask the First Minister what issues will be discussed at the next meeting of the Cabinet. (S4F-02245)
The meeting will discuss matters of relevance to the people of Scotland.
Bank of England governors tend to be cautious. [Interruption.]
Order.
Bank of England governors tend to be cautious, so Mr Carney being open about crisis plans for a run on the banks is serious. The First Minister has, as usual, spent the past 20 minutes ducking and diving, so let us see whether he can give a straight answer to this: can he confirm that those crisis plans will be needed only with a vote to leave the United Kingdom?
I can do better than that because, yesterday, the governor said that his plans were in place regardless of the outcome of the referendum. That is exactly what the central bank will do in its continuing role. It makes such contingency plans to stabilise financial markets.
If I can put it this way to Willie Rennie, it is really quite simple. The better together unionist campaign—himself, Labour and the Conservatives—is trying to destabilise financial markets. That is why that is on its website. The governor of the Bank of England—[Interruption.]
Order. Let us hear the First Minister.
—seeks to stabilise financial markets. That is because it is his responsibility. That is why people in Scotland will, like me, welcome the actions of the governor of the Bank of England and deprecate the politics of Willie Rennie and his colleagues.
Only the First Minister could claim that a warning of a run on the banks was a triumph for his cause. Claiming credit for a crisis that he caused makes him look like the old pretender.
The governor of the Bank of England is a cautious and learned man, whom the First Minister has just praised. The governor has been open about his crisis plan B. Is it not about time that the First Minister tells us his?
Of course, when the governor was asked about his contingency plans he said that it would not be helpful to spell out what those plans were. That is because he is a responsible governor of the Bank of England. Willie Rennie should accept that, in shooting down the fears, Mark Carney has done a very effective job of stopping the instability that Willie Rennie and his colleagues were so interested in creating.
The governor said:
“In terms of the financial stability questions - whatever happens in the vote, the Bank of England will continue to be the authority for financial stability for some period of time”.
He was making the obvious point that the bank will discharge its responsibilities.
Let us enjoy the next five weeks of the campaign in which we will all take part vigorously. However, there is a responsibility to explain the campaign to the people of Scotland. Everyone in this chamber should be acting in Scotland’s best interest. That is what this Government will do. I really wish and hope that the unionist parties could bring themselves to believe that this prosperous, independent nation is well capable of independence. We agreed that unanimously in the chamber last week; let it be reflected in the campaign rhetoric.
Independence (State Pensions)
To ask the First Minister what the Scottish Government’s response is to reports that an independent Scotland will not be able to support the state pension. (S4F-02251)
As one of the richest countries in the world, there is no doubt that an independent Scotland could afford a high-quality state pension system. Social protection spending as a percentage of both gross domestic product and tax revenues is lower in Scotland than in the rest of the United Kingdom and has been for each of the past five years.
I was interested in the responsible comments of the UK pensions minister, Steve Webb, who confirmed that state pensions built up prior to independence would continue to be paid to the people of Scotland. On 6 May, he said:
“It is what you have put into the ... national insurance system prior to independence ... They are entitled to that money.”
For the first Parliament of an independent Scotland, existing pensioners will have their state pensions updated by the triple lock. That means that their pension will increase by 2.5 per cent, in line with the increase of inflation or in line with the increase in average earnings, whichever of those three is the highest. I hope that Christine Grahame welcomes that reassurance as we seek to explain to the people of Scotland that yet another of project fear’s favourite stories is based on no foundation whatsoever.
As a pensioner, I welcome that assurance and thank the First Minister for his comprehensive answer. However, the issue remains of private pensions—paid now or in the future—which many pensioners fear will be under threat with independence. Does the First Minister agree that those pensions are a matter of contract and payable under the terms of contract, whether in an independent Scotland, the rest of the United Kingdom or elsewhere? Does he agree that with a yes vote we have an opportunity to use Scotland’s wealth to develop sustainable and better pensions for Scotland’s pensioners now and in the future?
I think that I can claim an unimpeachable authority for that point: the Daily Mail newspaper, of course. There have been a number of speculations in that and other newspapers about the position of private pensions. One of the yes campaigners, who wants to remain anonymous—probably because he is an ex-employee of the Daily Mail—wrote to the Daily Mail pension provider, Daily Mail and General Trust, asking about such claims. He received the following reply:
“I can confirm that should there be a yes vote in the 2014 Scotland referendum the benefit that you have accrued in the scheme will be unaffected. If you have any further questions, please do not hesitate to telephone me”.
We should all telephone the Daily Mail to ask why its pension provider is giving its pensioners the reassurance that, as yet, it is unfortunately not prepared to give to its readers.
Whatever the Daily Mail has said, we have all read what the Cabinet Secretary for Finance, Employment and Sustainable Growth said to his Cabinet colleagues when he warned that the volatility of oil revenues would compromise the affordability of pensions in an independent Scotland.
Yesterday, we saw that the previous year’s oil revenues were half what the Scottish Government had told us that they would be. Does that not just show us how right Mr Swinney was to flag up the threat to pensions from a yes vote next month?
With his unerring sense of timing, Iain Gray has managed to make that point on the day that Sir Donald MacKay, 25 years an adviser to successive Labour and Conservative secretaries of state for Scotland and a doyen of oil economists in Scotland, has described the Office for Budget Responsibility’s figures as “precisely wrong” and produced forecasts that back the Scottish Government’s assessment of oil revenues.
I welcome the fact that Iain Gray mentions oil and its forecasts. The difficulty for the unionist parties is their apparent suggestion that oil and gas are some tragic burden on the people of Scotland whereas, for every other country in the world, they are substantial assets. Those substantial assets will continue, and the best thing about it is that, at last, the resources of Scotland will benefit the people of Scotland, not the London Treasury.
The official Scottish Government pensions paper contains 30 key proposals but only four of those proposals are costed. Given the importance of pensions to the people of Scotland, will the First Minister agree to update his pensions paper and put costings next to all 30 proposals?
I do not accept the premise of the question. The white paper was quite specific about our proposals on pensions; the guarantee that pensions would continue to be paid and why they would continue to be paid; our explanation of affordability; the proposal for the triple lock; and our consideration of the retirement age, which is an important issue for the Scottish population. That is a significant body of work, and I suggest that the member reconsult it. He will see that the Scottish Government’s proposals on pensions give more guarantees, more assurance and, above all, more fairness than anything that has come from Tory or Labour Governments.
Independence (Food Banks)
To ask the First Minister whether there will be food banks in an independent Scotland. (S4F-02254)
As one of the wealthiest nations on the planet, we will seek to eradicate the need for food banks. The powers of independence can shape a fairer welfare system and ensure that many more of our people feel the benefit of that wealth.
Jackie Baillie will be aware that the Trussell Trust has seen a 400 per cent increase in the number of people who are using food banks in the past year, including more than 22,000 children. Yet, on Sunday, Labour suggested that, when the Deputy First Minister raised that hugely important issue, she was just creating a distraction. I saw today that another well-known Labour commentator has described the debate on the national health service and independence as another distraction. Has Labour really got to the point that it cannot face issues such as food banks and poverty in Scotland without calling them a campaign distraction? Labour should address the issue, as it tells us that thousands of our fellow citizens are suffering and being covered in poverty because of the policies of a Westminster Government that we did not vote for.
I point out to the First Minister that, rather than just talking about the issue, we on this side of the chamber are engaged in doing something about it. [Interruption.]
Order.
On Monday morning, in an interview with “Good Morning Scotland”, Nicola Sturgeon acknowledged that there would be food banks in an independent Scotland. By lunch time, she was saying that there would not be any food banks at all if people voted for independence. Is it not the case that countries such as Ireland have food banks and one in 10 people living in poverty despite being independent? Does that not demonstrate that tackling the problem is a matter of political will rather than constitutional change? Is it not the case that, as long as the Scottish National Party offers vague and uncosted promises on welfare at the same time as it gives tax cuts to big businesses, Nicola Sturgeon’s first answer is the right one?
Are we meant to believe that a policy that seeks, over a period of time, to eradicate the need for food banks in Scotland is being criticised by the Labour Party? I suspect that that is the position that the no campaign has got itself into.
Let me quote better together Aberdeenshire:
“Food banks are Scotland becoming a normal European country. ... Far from being a sign of failure they are an enriching example of human compassion, faith and social cohesion.”
Everyone salutes the work of those who are going to the assistance of their fellow citizens, but those in the yes campaign do not believe that the huge growth in food banks in Scotland is a sign of Scotland
“becoming a normal European country.”
We seek and aspire to have a society in which justice and fairness are at the centre of our social policy, and we know that that will not be implemented from Westminster—not by the current Tory Government and certainly not by a Labour Party that has said that it will accept the Tory party’s spending plans. Is the Labour Party so far gone in the debate that it is prepared to defend the expansion of food banks as a sign of the success of the union?
Free Childcare (Workless Families)
To ask the First Minister how many two-year-olds from workless families will receive free childcare at the start of the new school session. (S4F-02248)
Around 3,400 two-year-olds from workless families will take up their new entitlement to a free nursery place this month. Indeed, the first two-year-olds to benefit from the policy started in Renfrewshire nurseries on Tuesday this week.
In total, we expect that more than 8,000 two-year-olds from workless households will benefit from the free nursery place over the course of this year, giving them a better start to their education and their parents a much better chance of finding work.
I think that every political party in this chamber is on record as supporting improved childcare provision. However, it is clear that the Scottish Government has had to admit that several local authorities cannot deliver the full commitment for two-year-olds from workless families in the timescale that they were promised. What information process is being used to advise the parents who were expecting to access the places now what will happen and when they will get access to those places?
Again, I do not agree with Liz Smith. On 4 August, she issued a press release that claimed that there were significant problems in six council areas: Edinburgh; South Lanarkshire; Angus; Aberdeen; Midlothian; and Moray. However, there is no lack of capacity in any of those councils. The City of Edinburgh Council and South Lanarkshire Council have the capacity that they need. In Angus, Midlothian and Moray, private nurseries will be used to deliver the places. Some councils have already done that. There is no requirement for councils to use their own facilities. Aberdeen City Council is using family centres—facilities that, in my opinion, are perfectly suited to vulnerable young children in particular.
In her role as Conservative education spokesperson, Liz Smith raised a number of issues concerning education. She said that the curriculum for excellence would be a curriculum for confusion. Two months later, the curriculum for excellence was successfully introduced. She doubted whether the examination diet this year would be a success, and she wanted to have two diets of exams running simultaneously. As she may have noticed, the exams went forward over this summer with some considerable success.
I know that Liz Smith has been replaced as education spokesperson by the sunny optimism of Mary Scanlon—we all welcome that replacement, I think—but, given that she was wrong about curriculum for excellence and the examination diet, is it not possible that she will also be wrong in her predictions about a lack of nursery places?
The councils of Scotland are working hard to fulfil their statutory responsibilities, and that is exactly what they will do. Let us just welcome this significant expansion of nursery places to the people of Scotland.
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