First Minister’s Question Time
Engagements
1. To ask the First Minister what engagements he has planned for the rest of the day. (S3F-2838)
I have been speaking to Jorge Calvet, the chairman of Gamesa, which is the world’s third-largest manufacturer of wind turbines. In half an hour’s time, Señor Calvet will announce that Gamesa intends to establish a research and development centre in Glasgow, creating 130 jobs. Furthermore, he will announce that the company will sign memoranda of understanding with Scottish Enterprise, Forth Ports and Dundee City Council for its intention to establish a manufacturing, organisation and maintenance base in Dundee. I know that the whole Parliament will welcome that benefit to the Scottish economy.
The Scottish Government was caught red handed this week doctoring evidence on Scotland’s economic future. It took from an academic paper the quotation that I have here but changed the words so that it means something else. Will the First Minister tell the Parliament who doctored that evidence and on whose authority it was done?
If Iain Gray is going to hold pieces of paper up, he should get bigger writing so that people can see what they say.
That was Iain Gray’s first question since last September that could be related to the Scottish economy. Basically, it boiled down to his objection to the insertion of a square bracket explaining what fiscal devolution means—that is,
“[the proportion of revenue and expenditure devolved]”.
When I studied punctuation and parenthesis, I was told that a square bracket was where one put a point of explanation. However, if Iain Gray’s objection to getting real economic powers for the Parliament and for Scotland boils down to his objection—following Wendy Alexander’s lead—to a square bracket, the Labour Party has finally come to the end of its role.
No. When I studied English at school, if one took a quotation and changed the words in it, it was not a quotation any more. The First Minister cannot just dismiss the point. The Scottish Government used that doctored evidence in its draft budget and published it in its policy paper on financing Scotland. It was the centrepiece of Alex Salmond’s speech to his Scottish National Party conference, but it is simply not true. Will he now admit that it is simply not true?
The quotation is from Professor Andy Hughes Hallett and Professor Drew Scott and, of course, they stand by their analysis that fiscal devolution means
“the impact of devolving both spending and tax powers”.
If the authors of the quotation agree with the Scottish Government that that is an acceptable description of what fiscal devolution means—I repeat for Iain Gray’s information that it means Scotland having power over its spending and its ability to raise revenue—why on earth is Iain Gray objecting to it?
The substance of the argument is as follows: the Scotland Bill Committee, which is dominated by the unionist parties, refused to examine the Scotland Bill’s tax proposals because it knows that there is a deflationary bias that would cost Scotland either £8 billion, according to the Scottish Government, or £700 million, according to the Scotland Office.
The unionist Scotland Office and the independence-seeking Scottish Government agree that the proposals in the bill, if applied over the past 10 years, would have cost Scotland many hundreds of millions, if not billions, of pounds of revenue. The only disagreement is by how much Scotland would have been disadvantaged, so how on earth can a committee justify not examining something that it is meant to scrutinise and which could be of great damage to the Scottish economy? When we should all be seeking to benefit employment in Scotland, how can Iain Gray come along and ask me about a square bracket?
The committee examined the evidence, and it was found wanting. The First Minister told us this week that, as a boy soprano, he had a range of four octaves. I was impressed—Pavarotti could manage only two and a half, although I believe that Julie Andrews has four octaves, too. However, that is nothing compared to how far the First Minister will stretch the truth to try to make his case for independence. The First Minister told the SNP conference:
“We know thanks to the work of Andrew Hughes Hallett and Drew Scott that with economic powers we could grow the Scottish economy ... 1 per cent a year.”
However, the professors did not say that and they still do not say that. It is not true. Did the First Minister misspeak, or did he mislead his own party?
I am sure that the whole Parliament is mystified by Iain Gray, as we are week on week, but I suppose that the great mystery is why someone with his magnetic personality has yet to be invited on to “Desert Island Discs”. I have been thinking and wondering what Iain Gray’s selection would be if he ever got invited on to that programme. How about “London Calling” by The Clash or “That’ll Be the Day” by Buddy Holly? I point out to Iain Gray that, if Professor Hughes Hallett and Professor Scott are correct and we get a 1.3 per cent increase in gross domestic product, that means that we have a 1.3 percent increase in Scottish overall wealth every year, after getting economic and financial powers.
It is fascinating that Iain Gray seems to believe that the committee has been examining the Scotland Bill, when that is about the only subject that Wendy Alexander refuses to talk about. Time after time, Professors Scott and Hughes Hallett said, “Can we comment on our evidence?” but Wendy Alexander, the convener of the committee, did not want to talk about it. Why not? Because it has a deflationary bias that will cost every person in Scotland money. That is why the Labour Party does not want to talk about proposed legislation that it intends to support. In contrast, economic powers will bring Scotland wealth and prosperity.
Frankly, the longer the First Minister spends on a desert island, the better for Scotland. Leadership is a question of character, trust and judgment. If you take a piece of disputed research and then doctor it to mean something else, and you then embellish it and multiply the figures to suit your argument, how can you be trusted? If you then base your vision of Scotland’s future on that edifice of nonsense, what does that say about your judgment? And when you are caught out, if you will not put your hands up and admit it, what does that say about your character? Will the First Minister now republish his budget and take that doctored evidence out?
Let us deal with three points. First, Professors Hughes Hallett and Scott, the authors of the analysis, said in The Scotsman on 19 January 2011 that their figures
“were based on the impact of devolving both spending and tax powers.”
That is fiscal devolution, fiscal autonomy, fiscal responsibility or independence over the economy as we understand it. Secondly, the argument that some members in the Labour-Tory alliance on the Scotland Bill Committee have made—I recognise one of them, David McLetchie, sitting over there—was that Professor Feld did not argue about the devolving of both revenue and expenditure. The trouble is that David McLetchie and the committee cited only a part of the quote from Professor Feld’s evidence. I have the full quote before me. It goes on to say, and I quote, without square brackets:
“Decentralisation of taxes and spending leads to a more efficient public sector and it enhances economic performance.”
Enhancing economic performance is increasing economic growth and increasing economic growth is increasing prosperity for the Scottish people. If we can increase economic growth, as Professor Hughes Hallett and Drew Scott argue, we increase wealth and prosperity and employment in Scotland. If we are led by the unionist parties into the Tory trap of reduced Scottish spending that will result from the deflationary bias in the Scotland Bill proposals, we will face 10 to 15 years of progressive cutbacks in Scotland. That is why, when it comes to making a decision, people will vote for growth and real powers for this Parliament and this country.
Prime Minister (Meetings)
2. To ask the First Minister when he will next meet the Prime Minister. (S3F-2839)
I have no plans to meet the Prime Minister in the near future.
A quarter of a million people in Scotland are employed in the retail sector. That is one in nine of the Scottish workforce. Many shops are also vital outlets for Scottish food. The First Minister knows that because, when Sainsbury’s announced 1,300 new jobs in Scotland, he described it as—this is not a doctored quote—
“a significant boost to the economy.”
Now, however, many shops the length and breadth of Scotland face the Salmond super-tax, which threatens jobs and investment. How many jobs will be lost? Why is he giving out the message that in Scotland, if you grow your business, create more jobs and are a success, the Scottish National Party will punish you with a Salmond super-tax?
When we face difficult, tight economic conditions and when Annabel Goldie’s party’s Government at Westminster has introduced a £1,300 million cutback in our ability to spend, it is entirely reasonable for us to look for efficient ways to raise revenue so that we can protect public services and invest in things that we believe are vital for job creation.
As Annabel Goldie knows—we discussed the matter as recently as last week—we put forward a proposal for the small business bonus scheme. That was opposed by the Liberal Democrats and the Labour Party, but we managed to get it through, and we have retained and expanded the small business bonus scheme through the session. The scheme cost £140 million. It benefits 80,000 small businesses in Scotland, which pay no business rates or ones that are heavily reduced, and it is a vital engine of job creation and growth.
I say to Annabel Goldie that if we want to maintain the small business bonus scheme and to protect public services, it is entirely reasonable to ask those with the broadest shoulders to pay their fair share of tax.
I want to help all businesses, which is why my party made possible the provision of help with business rates bills to small businesses. The £30 million that the First Minister says might be raised by his proposal could be found four times over by dealing with the high levels of absenteeism in the public sector.
When it comes to his super-tax, the First Minister is sending out a message that it just does not pay to be a business success in Scotland. Whatever happened to the legendary SNP prawn cocktail offensive on business? Now the SNP is just being offensive to business. Never have so many prawns died in vain.
If the First Minister really cares about Scottish business and Scottish jobs and really wants to secure the Scottish recovery, he should put the kibosh on his tax on jobs. Will he scrap his Salmond super-tax and will he do that now?
Annabel Goldie quotes Michael Heseltine. Instead, I will quote Colin Borland of the Federation of Small Businesses, who said:
“three quarters of our members feel that it’s time for the largest out of town supermarkets—who benefit from free parking and other amenities that our members don’t enjoy—to start paying their fair share”.
I will also quote Stephen Boyd of the Scottish Trades Union Congress, who said:
“Let’s hope that the Parliament will pass this measure and quickly move on to discussing those aspects of economic development that really can make a difference to Scotland’s workers”.
The Scottish Licensed Trade Association said:
“The Scottish Government has identified a fair and reasonable way to raise money in this very difficult economic climate.”
I do not claim that the Conservatives are inconsistent. On every possible occasion and at every possible opportunity, they will back big business, but we have put forward a proposal that we believe is fair. It is right for the economic times that we are in, when we must raise additional revenue, and it will help to rebalance the burden on business between the high street and the out-of-town supermarkets. If it was not going to raise £30 million, there would not be the degree of opposition from the big retailers that we have seen. It is designed to raise money to protect public services, to finance the small business bonus, and to help to finance the council tax freeze. If Annabel Goldie and the Conservative Party want to delete it, they will have to specify what issues beyond their vague commitments they are going to raise, tell us how they are going to raise the money, and tell small business and the people of this country why they, instead of those who have the broadest shoulders, should have to pay.
Secretary of State for Scotland (Meetings)
3. To ask the First Minister when he will next meet the Secretary of State for Scotland. (S3F-2840)
I have no plans to meet the secretary of state in the near future.
Next week, the Parliament will debate the budget. I accept that choices will have to be made to allow any new spending. A year ago, I asked the First Minister about high pay in the public sector. What progress has his Government made since then?
We have made substantial progress. We have announced proposals to introduce severe wage restraint in the public sector because we believe that that is part of the contract to maintain employment, but we will protect those who are on the lowest incomes in the public sector. That is the right way to proceed, and it is part of the Government’s social contract with our employees and those of the national health service and other agencies, and with the people of Scotland.
A year ago, the First Minister told me that high pay had already been dealt with. We asked the same 160 public sector organisations how much they are spending to pay staff more than £100,000 per year. They told us that last year they spent £281 million and this year they are spending £334 million, so spending on high pay has gone up by £53 million in one year. I am puzzled because, although the SNP Government’s pay policy promised punitive action on high pay, spending is rising quickly. Does the First Minister still believe, as he has just said, that those who have the broadest shoulders should carry the biggest burden?
Yes, I do. That is why we propose a pay freeze for those who are earning more than £21,000 a year in the public sector.
The basis of the Government’s approach has been to substantially reduce administrative expenditure in the public sector. The member has seen the budget proposals that do that dramatically. The basis of the Government’s approach is also to heavily restrict bonuses in the public sector, hence our argument in relation to consultants in the health service. We have led the field on that issue against an unwilling Westminster Government and against the extremely slow progress of the present Westminster Government. Anyone who looks at John Swinney’s record as finance secretary can see that he has proposed that those who have the broadest shoulders should bear the biggest burden. He has done that with the intention of protecting employment in the public sector. Our dearest wish is that, if we can get the flexibilities that will be required and acceptance of the pay settlement, our policy of no compulsory redundancies can be maintained. That is something of which the Government is very proud indeed.
I will take a supplementary question from Frank McAveety.
I welcome the First Minister’s comments about jobs, economic growth and fairness. Does he think that it is right and fair to slash the budgets of urban regeneration companies across Scotland? Will he ask his enterprise minister to intervene to prevent the 46 per cent cut in the budget that is available to Clyde Gateway in the east end of Glasgow, which will jeopardise the opportunity to bring jobs and industries to a number of vacant sites in one of our most economically disadvantaged communities? When did the east end of Glasgow become the area with the broadest shoulders in Scotland?
As Frank McAveety should well know, the budget for Clyde Gateway is £18.1 million for 2011-12. That is a substantial commitment that will allow Clyde Gateway to deliver the priority projects that it has established for 2011-12.
As Frank McAveety also knows, and as has been generally acknowledged, we are incredibly supportive of the Commonwealth games project. It will be a fantastic development for Glasgow and a fantastic adventure for Scotland as a whole. The overwhelming majority of the people of Glasgow appreciate that commitment from the people of Scotland and the Scottish Government. I am sure that those same constituents would want their representatives occasionally to reflect that endorsement of a substantial investment of hundreds of millions of pounds in Glasgow.
Paternity Leave
4. To ask the First Minister what the expected economic impact in Scotland would be of the United Kingdom Government’s proposal to allow fathers to take up to 10 months’ paternity leave. (S3F-2856)
There would be an economic impact, but we welcome the UK Government’s proposals on enabling fathers to share the care of their children. Scotland is leading the way on addressing inequalities between men and women and on improving support for families, especially during the early years of a child’s life, when it can make such a key difference.
I thank the First Minister for his answer and share his welcome for the proposed arrangements, which will allow fathers to bond more closely with their children in the important early years of life. Does he agree that any possible short-term increased cost or loss of productivity caused by the policy would be more than offset by the improved social and educational consequences of allowing both parents to play an active part in their child’s upbringing?
The estimates for economic impact were based on a 4.8 per cent take-up and suggested that 1 per cent of small businesses would be affected on that basis. The estimates were produced by the previous Westminster Government and are shared by the current Westminster Government.
I accept Ian McKee’s point that there is substantial evidence on the importance of parental support and attachment in child development and wellbeing. We know, too, that the impact of parental neglect on a child can be extremely damaging and permanent. Supporting parents is therefore one of the cornerstones of the early years framework, and I agree that maximising positive paternal time with young children will pay dividends in the future. I think that there is political unanimity that that substantial enhancement and investment in the future makes the measure worth supporting.
Renewable Energy (China)
5. To ask the First Minister what contribution the Scottish Government made to securing the recent renewable energy deal with China involving Shanghai Huanuan Boiler & Vessel/Cochran and W2E Engineering Ltd. (S3F-2853)
Neither the Chinese Government nor the Scottish Government was directly involved in the commercial agreement, but Scottish Development International provided its normal investment support.
Is the First Minister in a position to advise us what the deal means for the two companies’ subsidiaries in Dumfriesshire? Cochran Ltd last week appeared to be unaware of the deal and has submitted a petition to Dumfries sheriff court to request that Waste2Energy Engineering Ltd be wound up, claiming that a bill worth several thousands of pounds owed in connection with the Scotgen Dumfries plant has not been paid. The First Minister was keen to claim some publicity around the deal at the beginning of last week. In connection with that publicity, can he assure us that the deal means jobs in the Annan area and money coming into Dumfriesshire?
I am aware that there has been some confusion locally about the extent of the involvement of Cochran Ltd in the agreement. The origin of the confusion is the use of the SHBV brand name in China, where it is SHBV Cochran. Cochran Ltd itself is not a signatory to the agreement, although it is a potential beneficiary of the deal—a fact confirmed by SHBV in a press statement on 13 January, which I will be happy to send to the member.
I say to Elaine Murray that Chinese direct investment in Scotland is undoubtedly a good thing. There are companies in Scotland that would not be trading at the moment without that investment. The agreements that were announced at the beginning of last week will be of immense benefit to many workers in Scotland, not least at the Grangemouth refinery, and to many industries in Scotland, not least the whisky and salmon industries. Countries in surplus, such as China, must be encouraged to invest directly in our economy. That developing relationship should carry the support of every single member of this Parliament.
Fish Discards
6. To ask the First Minister what action the Scottish Government is taking to eliminate the discarding of fish. (S3F-2846)
John Scott is right to raise the issue. Across Europe, fishermen are forced to discard—and have been for generations—perfectly good fish back into the sea, although they are dead. That is a waste of a perfectly good and healthy food and a vital economic resource.
As John Scott knows, the Scottish Government has been working with fishermen and other stakeholders, and we are leading the way in efforts to reduce the discarding of fish. This year, our innovative catch quota system was the largest in Europe, and it is one of a number of measures that we are taking to reduce discards.
Reducing discards will continue to be a priority for the Government, along with returning full powers over fisheries back to Scotland. I know that many members support our action against discards, just as many members across the chamber are vehemently critical of the common fisheries policy.
Most right-thinking people are outraged by discarding—indeed, none more so than the fishermen who are fighting for their livelihoods. Some 41 boats have been tied up this year, yet they are forced to implement this dreadful practice.
The First Minister will be aware of fishermen’s unease with the catch quota approach that his Government has taken, but he will also be aware that the United Kingdom Government has called for an end to discarding coupled with more decentralised decision making, which will be vital to achieving that. In the light of that, will the Scottish Government redouble its efforts to work with UK ministers, European officials and, crucially, Scotland’s fishermen to develop other ways of reducing discards, in addition to catch quotas, and so end discarding for good?
If we are to end discarding, it will require fishermen to be allowed to land what they catch. The catch quota system is designed to enhance quota to allow that to take place. The catch quota system is extremely popular and has been oversubscribed several times, with many applications for places in the scheme. It is vital that the enhancement of quota is sufficient to allow the catch quota system to operate fully.
I am sure that John Scott will acknowledge—I looked it up when I saw his question—that I made my first speech about discarding in a debate on a motion in the House of Commons in December 1988. It has been a long-term campaign by me and just about every other fishing MP to see the obscenity of discarding removed from fisheries policy. I hope that he will agree that the catch quota system must be allowed the opportunity to provide part of the answer.
Does the First Minister share my view that the only way for the Scottish Government to have a real voice when it comes to the common fisheries policy and the progression of innovative policies on discards and maintaining healthy fish stocks is for Scotland to become a full independent member of the European Union?
Yes, I do. There are two aspects of the common fisheries policy that I will never be able to understand. We have been discussing one of them: discarding is an obscenity and it should be removed. The other is that, under the common fisheries policy, landlocked member states—many of which, no doubt, Iain Gray has insulted from time to time—have more say in deciding fisheries policy than the nation of Scotland, which has a vast proportion of the territorial waters in the European Union. That is why only an independent Scotland will have a seat at the top table and be able to defend the rights of our fishing and rural communities.
Although I share the First Minister’s concerns about the extent of discards and indeed his criticisms of the common fisheries policy, he will be aware of the criticisms that were levelled at the catch quota approach this week. Bertie Armstrong, the leader of the Scottish Fishermen’s Federation, described the approach as a perfect control measure for enforcing a system of management that is broken. In that context, what would the First Minister say to those Scottish white-fish skippers who have already registered with producer organisations south of the border and those who are contemplating doing so as a result of concerns about the approach that is being taken to catch quotas and, indeed, conservation credits?
I say two things to Liam McArthur. First, it is clear that the catch quota system is extremely popular, as applications to the system have been substantially oversubscribed. He should not give the impression that the Scottish Fishermen’s Federation is against the principle of catch quotas, because it has made it clear on many occasions that it is not. The concern is whether the enhanced quota will allow the catch quota system to operate properly. That is exactly what Richard Lochhead and his officials are dealing with at present.
I remember that the member’s leader once had to resign from a Government over the common fisheries policy. Although I share the concerns about it, if people are critical of the common fisheries policy, as Liam McArthur and I have been, they must consider two things. First, they must put forward proposals to mitigate the impact that the CFP has had and keeps on having on our fishing communities. The catch quota system, which will enhance the quota that is available to Scotland as well as to individual fishermen, is an attempt to do that.
Secondly, it is not a policy just to criticise the common fisheries policy; there must be an alternative—a different style and system of managing this resource. That is why I have always believed that national management of resources is perfectly compatible with European policy. That is what we should seek as a Parliament if we are to take best advantage of our position as one of the countries with the most plentiful fishing in the whole European continent.
I normally refer to fish with a twist of lemon and a shake of black pepper, but, if I am allowed to intervene in this debate, I suggest that there is an alternative to the suggestion that Maureen Watt made. If Alex Salmond has been trying since 1988 to make sense of the common fisheries policy, does he not draw from that some sort of lesson that maybe we should just get out of the European Union altogether?
I do not draw that conclusion. I would rather just change the common fisheries policy and allow us control of our own resources on fish and other things. However, I do agree with Margo MacDonald that the common fisheries policy is rather like the Schleswig-Holstein question in European history: only three people ever understood it—one is mad, one is dead and I have forgotten.
12:31
Meeting suspended until 14:15.
14:15
On resuming—