Finance, Employment and Sustainable Growth
Good afternoon. The first item of business is portfolio questions on finance, employment and sustainable growth. As ever, if questions are short and succinct and we have answers to match, we may get through everyone.
George Square (Redevelopment)
The Scottish Government has agreed the business case for the overall tax increment financing scheme for the Buchanan quarter, which includes improvements to George Square. However, the precise detail of those improvements is a matter for Glasgow City Council.
I can only echo what the people of Glasgow are saying: the whole sad episode has been an absolute shambles from start to finish. The cabinet secretary may be aware that £90,000 has already been spent, the cost is rising and people are most concerned. If the cabinet secretary or the Scottish Government is going to meet Glasgow City Council and Councillor Gordon Matheson—whose idea this was—could the cabinet secretary please keep the Parliament and the people of Glasgow informed of any updates, as that has not happened? Do not keep the people of Glasgow in the dark.
The TIF project comprises a range of public infrastructure projects in Glasgow’s Buchanan quarter, including improvements to George Square, the pedestrianisation of Dundas Lane, city centre connectivity, the reconfiguration of Queen Street station’s entrance and an enhanced Royal concert hall. The proposals that Glasgow City Council is now considering are for what has been described as a “substantial facelift” of George Square. The Scottish Government looks forward to discussing the change in the project’s direction with Glasgow City Council in order to understand the implications for the total cost of the project. If there are any relevant issues that relate to the tax increment financing element of the proposals, Parliament will, of course, be kept up to date on those issues.
The cabinet secretary knows that I have some problems with the notion of tax increment financing in this case, but if the council had wanted to proceed with a kind of Disneyland George Square on the scale of the proposals that have come forward in the past few weeks, would it not have made sense for it to have brought that forward when the TIF scheme was initially mooted, so that there could have been public, media and, indeed, parliamentary scrutiny of the proposals rather than the last-minute rush that we have seen in the past few weeks, which has led to a bit of a fiasco outcome?
It is important that we separate two elements, and I was anxious to do that in my answer to Sandra White’s question. The TIF scheme essentially involves the construction of a vehicle to enable public sector resources to be used to leverage private sector investment. That is a good way to proceed to maximise the investment impact for the city of Glasgow and some of the detailed components of the proposals. It is good practice with any detailed components of the type in question—such as the redevelopment of George Square or the Queen Street station entrance or whatever—to have adequate, full, proper and meaningful public consultation on the contents of the proposals. That will be an essential element in taking forward all of the projects. However, it is important that we distinguish between the TIF scheme and the specific proposals on the ground, which are unreservedly a matter for Glasgow City Council.
I am unclear about whether or not members of the Scottish Parliament who have campaigned for improvement in George Square now support that. I recall that the group leader of the Scottish National Party in Glasgow argued that George Square needed a substantial facelift, not just a revamp. I presume that he now takes the opposite view.
I am not a member of Glasgow City Council and, just for the record, I point out that, impressive though the surroundings of Glasgow city chambers are, I have no aspirations to be a member of that council. Many of the issues that Mr Smith raises should have been bandied around in the precincts of Glasgow city chambers, in much more elegant surroundings than those in which we debate in the parliamentary chamber.
Employment (Rural Areas)
We are investing significant sums of money in rural areas, including around £455 million of direct support annually to farmers and crofters across Scotland and £214 million of Scotland rural development programme funding for farming, businesses and communities in rural areas. Those sums go a long way towards safeguarding in the order of 68,000 jobs in agriculture and in rural businesses across Scotland. In the sea fisheries and aquaculture sectors, using the European fisheries fund, the Government is awarding funding of more than £66 million to 677 projects, which has generated about £150 million-worth of investment.
An SRDP grant of just £56,000 will allow the Building Workshop—a rurally based architectural company in my constituency that is run by a young husband and wife team—to open its first bespoke office later this year and to double its existing workforce. Will the Scottish Government continue to think smart about how it protects and enhances employment opportunities in rural areas and consider the suggestion by the Rural Affairs, Climate Change and Environment Committee in its draft budget report that we should allow youngsters who are seeking modern apprenticeships in rural skills to work for a range of businesses throughout the term of the apprenticeship so that they might be better placed to obtain year-round employment?
I think that I am familiar with the business to which Mr Dey refers, as it is based in the area that I used to represent before the boundary changes in 2011. I am glad to hear about the progress that the company is making. The suggestion from the Rural Affairs, Climate Change and Environment Committee is worthy of further consideration, so I will ensure that the Minister for Youth Employment, who has heard Mr Dey’s points, examines the issue in detail. It is essential that we find innovative ways of strengthening the skills base and the employment opportunity base in rural Scotland. If we need to deploy a certain amount of flexibility to enable that, we should very much be open to that possibility.
Bannockburn Celebrations
A range of partners are working together on a programme to mark the 700th anniversary of the battle of Bannockburn. The battle of Bannockburn re-enactment weekend over 28 to 30 June will be a centrepiece of the homecoming Scotland 2014 celebrations and a highlight of the Stirling 2014 programme. It will include the largest battle re-enactment ever hosted at the memorial battlefield, a tented clan village, weaponry and falconry displays and a clan parade.
I pay tribute to the work of Strathleven Artizans in promoting the story of Robert the Bruce and his connections to Dumbarton. I am sure that the minister will agree that the story of Robert the Bruce has tremendous potential to generate tourism opportunities in a variety of areas in Scotland. Therefore, what plans does the Government have to promote other sites of interest that are associated with Robert the Bruce, particularly in the Dumbarton area?
Stewart Maxwell is entirely correct. For many of us, especially on these benches, Robert the Bruce is a national hero. I hope that that applies to members on all the benches in this Parliament. Although Robert the Bruce won Scotland’s independence before the invention of political parties, I suspect that he was politically ecumenical, because he simply believed in his country of Scotland.
The Standing Council of Scottish Chiefs has said that the Bannockburn re-enactment will not be enough to bring the diaspora back to Scotland. In light of that, what is the minister’s plan C for homecoming 2014?
I had the pleasure of meeting a number—I do not know what the collective noun is—of clan chiefs at Castle Leod just before the turn of the year. I look forward to further engagement with several more of them in early course. We work closely with the clan chiefs. We recognise that, generally speaking, clan gatherings take place on a quinquennial basis and that they have a great deal to offer Scotland.
Unemployment (Glasgow Provan)
The Scottish Government is investing heavily to support the job prospects of people in Glasgow. For example, for the period June 2011 to June 2013, we have awarded £7.58 million of European social fund and £616,000 of European regional development fund to Glasgow’s community planning partnership. That money will be used to help around 10,500 people to move towards work and to create more than 1,300 jobs.
The minister will be aware of a number of schemes throughout Scotland that are designed to regenerate derelict land and at the same time create employment. Would he agree to meet me to discuss how we could take forward such a scheme in the Easterhouse area of my constituency?
I would be delighted to meet Mr Martin on that issue. The Government’s focus is about working collaboratively with a range of players to try to bring together creative thinking to find new ways of enabling sites to be brought into use, to leverage in investment and to remove any obstacles to that investment taking place. I will happily arrange to see Mr Martin, and any colleagues he may wish to bring with him, to discuss those issues.
Unemployment (Lothian)
The Scottish Government is taking forward a range of initiatives to support employment in the Lothian region. Over the course of the current European funding programme, more than £12 million has been received by City of Edinburgh Council, Midlothian Council and West Lothian Council to improve the skills of the unemployed, the lowest paid and the socially deprived.
There have already been high-profile casualties in the retail sector this year, with Jessops, HMV and Blockbuster entering administration. Among those three chains, there are 15 stores in Edinburgh alone, of which seven have been confirmed for closure. Will the minister give an update on what action the Scottish Government is taking to support workers at those stores, who are at risk of losing their jobs? Will he provide further information on news that the restructuring specialist Hilco has bought HMV’s debt and the impact that that might have on the future of that retailer?
Of course, in any circumstance in which individuals are either in danger of losing employment or have lost employment, they will have access to the partnership action for continuing employment support scheme, which is working in all parts of the country. That will be available to the individuals who are affected by any of those redundancy programmes or closures.
Unemployment Levels (Reductions in 2013)
This morning, it was reported that unemployment in Scotland has fallen by 14,000 over the three-month period from September to November 2012. Youth unemployment, also part of those numbers, saw the largest drop since the data series began in 2006 and is at the lowest level since the period from March to May 2011.
I thank the cabinet secretary for his answer. The reduction in the latest unemployment figures is welcome, but does the cabinet secretary agree with the Scottish Chambers of Commerce, which pointed out that there are underlying issues that must be addressed by actions to stimulate the economy?
I very much agree with the points that Mr McMahon articulates from the Scottish Chambers of Commerce. There are, of course, underlying issues that need to be confronted and I have made no secret of the fact that I believe that there is a strong role for Government in leading a dynamic programme of capital investment and a programme of investment in skills and training to support economic recovery. We will continue to articulate that point.
One of the welcome announcements in the September budget statement was the announcement of a weighed subsidy programme. Is the cabinet secretary able to give us any further details on how that programme will work to counteract unemployment? If not, can he tell us when those details will be forthcoming?
The Government is finalising the details that will be available on the employer recruitment initiative. As I indicated, it will be focused on the small and medium-sized enterprises sector to provide practical assistance to enable small and medium-sized employers to take on additional staff. That has very much been the aspiration of organisations that represent small businesses, such as the Federation of Small Businesses and the Scottish Chambers of Commerce, as we just discussed. The details of that programme will be announced shortly, and I look forward to seeing the positive impact that it will have on the labour market in Scotland.
Oil and Gas Revenue
The oil and gas sector is one of Scotland’s great success stories. In addition to supporting almost 200,000 jobs across Scotland, the industry generated more than £10 billion tax revenue last year.
In the same vein, how important is our renewables sector to Scotland’s economy and how important would it be to an independent Scotland?
The renewables sector is extremely important to the Scottish economy. It supports around 11,000 jobs in this country. Over the past year, it has received £1 billion of investment. Projected investment in our renewables sector over the coming years is in the order of £9 billion. Those are gigantic numbers.
Could you be briefer, minister?
Those numbers reflect the fact that the industry will be extremely important to the Scottish economy for many years to come.
Moray Council (Financial Assistance for Storm Damage)
Following the severe weather in December, I agreed to activate the Bellwin scheme, which provides additional revenue support to affected councils to assist with the immediate and unforeseen costs of dealing with the aftermath of emergency incidents. We will consider all eligible expenditure under the scheme when formal claims have been received from the affected councils, including Moray Council.
The minister will know that, during the storms last month, significant damage was caused to the sea wall at Lossiemouth and remedial repairs have been done. At Kingston, homes that had been protected by the shingle bank saw that buffer from the sea reduced by hundreds of tonnes of shingle.
Question, please.
What changes to the scheme or additional financial support will the Government offer to assist Moray Council in reinstating protection for Lossiemouth and Kingston?
Mary Scanlon’s description of the Bellwin scheme is correct. It is a discretionary scheme that addresses revenue costs only to repair damage to bring facilities up to a previous standard. If additional work is required for any betterment, that would be capital expenditure, which is not eligible under the scheme. That has been the case for some time.
I remind members of the need for brief and relevant questions and answers.
Department for Work and Pensions (Work Programme)
The latest statistics that the Department for Work and Pensions has released show that fewer than one in 10 people who started the work programme in June 2011 gained sustained employment within a year. As I have said in other answers, the labour market statistics that were released today show that unemployment in Scotland fell by 14,000 over the quarter and that the youth unemployment rate has had the largest annual drop since 2006—it is now at its lowest since March to May 2011.
Like many other MSPs, I have had constituents come to my office to express deep concerns about the work programme. Has the cabinet secretary discussed the programme with the DWP and the outcomes that it may or may not be delivering for Scotland?
We have had regular discussions with the DWP about the work programme. It is important to see that as part of the range of steps that are available to encourage people back into employment.
Scottish Enterprise (Meetings)
I last met the chief executive and other members of the board of Scottish Enterprise on 16 January to discuss a range of issues that are important to the delivery of the Scottish Government’s economic strategy.
I recognise that, on his visit to Inverclyde, the cabinet secretary recognised the significant potential for cruise liner business there and in the rest of Scotland. The Minister for Energy, Enterprise and Tourism has also said encouraging words about cruise liners.
Mr McNeil, I need a question.
The potential at Inverclyde needs to be extended and maximised. Given the support of the cabinet secretary and the minister, have they taken the time to impress on Scottish Enterprise’s chief executive the importance of the project in Inverclyde? Will the cabinet secretary give us an update on that?
I stress to Mr McNeil that the topic of cruise business did not come up in my conversation last week. However, as he will recall, Scottish Enterprise representatives accompanied me on my visit to Inverclyde.
Loch Lomond and the Trossachs National Park Authority (Capital Allocation)
In 2013-14, £290,000 of shovel-ready capital investment has been allocated to Loch Lomond and the Trossachs National Park Authority. That will help to fund a range of projects that are aimed at facilitating improvements to visitor infrastructure and buildings and the development of community projects.
Does the cabinet secretary agree that if the Parliament accepted the Labour Party’s budget proposals, which were put forward yesterday, all of that 2013-14 money would be lost to the park? Does he agree that, in this year of natural Scotland, that would be an utter disgrace and very unhelpful to the park economy?
The point that Mr Crawford makes is very relevant to the budget debate that we held yesterday. The argument that the Labour Party advanced was that we should take the capital consequentials that I allocated in December to projects such as the one in Mr Crawford’s constituency and apply them to other projects. The key point here is that the money cannot be spent twice. It can only be spent once when it is capital; it cannot be double promised or multiple promised by people. [Interruption.]
Mr Macintosh.
The Government has set out its choices. If other people want to change those choices, they have to argue for that and take the consequences.
On a point of order, Presiding Officer, can I confirm that this is questions to the finance minister and not questions to the shadow finance minister? I am not entirely sure how Mr Swinney can answer—incorrectly—on behalf of the Labour Party if we are not—
Mr Macintosh, that is not a point of order. We move on to question 12 from John Wilson.
Employment Initiatives
Since the start of 2007, more than half of those accessing European social fund employability support across Scotland have been over the age of 25. The projects address the challenge of improving the skills of the unemployed, the lowest paid and the socially deprived while contributing to Scotland’s future economic growth. To date, £63.684 million of ESF grant has been allocated in priority 5 and £32.34 million of that funding has been allocated to 16 community planning partnerships in some of the most deprived areas of Scotland.
Although I welcome the unemployment figures that were released today, in November 2012, according to Office for National Statistics figures for claimant unemployment by age, in South Lanarkshire the claimant count stood at 75 per cent for those aged 25 and over. Will the cabinet secretary expand on the issues that will be raised through the employability fund to get those aged over 24 into sustainable employment?
The employability fund will focus on exactly the point that Mr Wilson raises; it will focus on ensuring that we support individuals back into the labour market. At present, anyone over 18 who has been unemployed for 13 weeks or more can access a wide range of opportunities through training for work. That will be incorporated into the employability fund, which will seek to help local areas to respond even more flexibly to labour market demand in their localities.
Social Impact Bonds
This is the first occasion on which I have had a chance to welcome Jayne Baxter to the Parliament. I do so, and I wish her well in her tenure in Parliament.
I thank the cabinet secretary for that answer. I am pleased to hear that he is aware of the potential benefits of social impact bonds, but I am disappointed that pilot projects have not yet been identified. Earlier this month, I was pleased to visit the YMCA’s living balance project in Perth, which, over three years, is helping 300 young people into employment or training using a social impact bond model. It is one of only six projects in the United Kingdom to do so. Given the success of that project, will the minister commit to identifying the social impact bond pilot projects as soon as possible?
I am familiar with the project that Jayne Baxter refers to at the YMCA in Perth and I understand its impact. We have taken forward a range of ventures that are operating in similar territory, principally around public social partnerships.
Business Start-ups
The Scottish Government recognises the vital role that new businesses play in contributing to sustainable economic growth and is committed to maintaining a supportive environment to encourage new start-ups and help them grow. Key measures include support from the business gateway, which last year helped more than 11,000 businesses start up; the small business bonus scheme, which benefits more than 89,000 business properties; and steps to reduce unnecessary burdens on small businesses and to make it easier for them to access public sector contracts.
I am grateful for the minister’s response, but I must question the effectiveness of the Government’s policies. I note that in the third quarter of last year business start-ups fell by 16 per cent and that that had been the third quarter in a row in which there was a fall in Scotland. Given that I am sure the minister agrees that economic recovery depends to a large extent on new business start-ups, what further steps is the Scottish Government considering to reverse the current trend?
I think that Mr Fergusson and I agree that these are tough economic times, but I know of a number of great successes in Dumfries and Galloway. Indeed, I have had the pleasure of visiting that part of the world in the south of Scotland on many occasions and have seen considerable success in businesses.
Shovel-ready Projects
The construction and maintenance projects that we announced in December as part of a £205 million capital funding package are now being taken forward by the relevant portfolios.
I congratulate the cabinet secretary on securing £205 million-worth of additional Scottish construction projects, albeit in the context of an initial 33 per cent cut in the capital budget. How will the Central Scotland region benefit from the funding announcement and how might Scotland have proceeded differently with the full fiscal powers of independence?
As Clare Adamson is correct to point out, the Government has maintained a very clear and strong emphasis on the importance of capital investment, and I am glad that we were able to make some progress in persuading the United Kingdom Government to change tack from the vicious reduction in capital expenditure that it had imposed on Scotland.
Can we have a brief question 16 from Colin Beattie, and a brief answer, please?
Bank of Scotland Survey of Purchasing Managers
The Scottish Government welcomes the findings of December’s Bank of Scotland purchasing managers index, which shows a third consecutive month of expansion in private sector activity in Scotland and the strongest monthly improvement since June.
I was pleased with the news of positive growth to start the new year.
Question, please.
Does the cabinet secretary agree that, despite the negativity of the no campaign’s rhetoric on an independent Scottish economy, companies are still actively investing in Scotland?
There is significant evidence to support Mr Beattie’s point, whether it comes from Statoil, Dana Petroleum, Global Energy Group, Plexus or Vector Aerospace. Of course, that was before we realised that the United Kingdom economy would be plunged into five years of uncertainty in the debate about a European Union referendum, courtesy of the United Kingdom Government—[Interruption.]
Order.
All the scaremongering about the independence referendum will disappear, now that the UK Government has taken the course of action that it has taken.
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