First Minister’s Question Time
Engagements
1. To ask the First Minister what engagements he has planned for the rest of the day. (S3F-2496)
I have a range of engagements to carry forward the Government’s programme for Scotland.
The Tories’ savage budget will hit Scotland hard. [Laughter.]
Labour cuts.
Order.
I assure colleagues opposite that they are the only ones who are laughing.
Nicola Sturgeon was right to complain that the VAT bombshell in the budget will cost our national health service £26.5 million, but she could do something: she could get Alex Salmond to cancel his rates revaluation, which will also cost our NHS millions—£1 million in Grampian alone. That has been done in Northern Ireland. Will the First Minister do it here?
No. A business rates system must be subject to revaluation, otherwise we could not sustain a rateable system. As Iain Gray knows from previous discussions, the substantial majority of businesses throughout Scotland will be no worse or better off as a result of the rates revaluation. Our system of rates, through the variety of packages of aid and reliefs that we offer in Scotland, is superior to that anywhere else in these islands. If, in addition to it, Iain Gray wants us to introduce a further scheme, as was suggested by the Liberal Democrats a few weeks ago, he had better identify where the public funds would come from.
If the rates revaluation system is income neutral, as the First Minister told me two weeks ago, the measure that I propose would help the NHS and would not cost him anything at all.
What about our games industry? The budget cancelled Labour’s tax break for the industry. The Scottish National Party says that that will cost 200 jobs in Dundee, and I think that it is right, but let us not just complain—let us actually do something for a change. John Swinney told us yesterday that he has £300 million in the bank. We can take £5 million of that—equivalent to the tax break—and find a way to support the games industry anyway. Let us save those 200 jobs, despite the Tories and the Liberals. Will the First Minister do that?
I will first correct Iain Gray on business rates. What I told him a few weeks ago is that revaluation is essentially a neutral process. What that does not take account of is the additional move that the Scottish Government made to reduce the rateable poundage by 15 per cent and bring it down, for the first time in history as far as I know, into line with the rateable poundage for England and Wales. That is a cost of £200 million in addition to all the other reliefs that are available. I am sure that Iain Gray would not want to ignore the fact that reducing the rateable poundage helps every business and, indeed, every public sector organisation, including the health service in Scotland.
As far as the games industry is concerned, I deeply regret that the Government in Westminster has chosen to cancel the proposed tax relief and I agree that it is a short-sighted decision. I think that the centre of the games industry in Scotland is a jewel in the crown of Scottish industry; it is fantastic for the city of Dundee and I cannot see that it is sensible to jeopardise that performance. I thought that the Independent Game Developers Association—TIGA—the representative body for the games industry, put forward a powerful case for why that particular tax concession, or another tax concession, if one can be identified, could substantially help to generate jobs, employment and, therefore, revenue over the medium term.
Iain Gray says that we should act on the games industry. It might be instructive to look at what the industry itself is saying about the setback in the budget. Richard Wilson, the head of TIGA, which is an excellent trade body, says that the Scottish Government should have tax-raising powers, so that it can protect the games industry and introduce such a tax incentive. If the games industry is calling for that, when on earth will the Labour Party realise that we must have fiscal responsibility so that we can boost our industry?
The First Minister is an awful lot better at explaining what he cannot do than he is at explaining what he can do and why he chooses not to do it.
What does someone have to do to get help from the Scottish Government? They have to put on a kilt and call themselves a clan chief. Then they can have a secret, interest-free loan, with no questions asked. Here is the best bit: they do not even need to pay it back; they just need to promise the First Minister a photo opportunity in a beaver hat and name their price. What do the NHS, the games industry and businesses that are not The Gathering 2009 Ltd have to do to get action from the First Minister?
Given Iain Gray’s passionate concern for the tourism industry in Scotland, I know that he will not want to ignore that the gathering event generated £8 million in revenue for our tourism industry in the city of Edinburgh and £10 million across Scotland.
No doubt that is what the Auditor General for Scotland, Robert Black, was thinking of yesterday when he told the Public Audit Committee, in relation to the decision to award the loan:
“clearly time was not on anyone’s side by the summer of last year, because the event was committed and was about to proceed. The Scottish Government”
took
“the not unreasonable view that in order to allow the event to proceed it should assist the short-term cash flow problems of the company delivering the event.”
I have no doubt that the Auditor General made that remark in response to questions from the committee because he realised that it would have been a bad thing for jobs in Scotland and a blow to the tourism industry in Scotland to cancel an event that turned out to generate £10 million for the Scottish economy. If Iain Gray wants to complain retrospectively about the decision, it behoves him to explain to the visitor and tourism industry in Scotland where it would have got the £10 million that the Labour Party wanted to deny it.
I do not expect that the First Minister wants to ignore the fact that Edinburgh businesses appeared on the news last night, explaining how they had had to make people redundant because of the mishandling of the event by his Government. I hear nothing from him about what he will do to help them.
Audit Scotland’s report, “The Gathering 2009”, shows that the First Minister can take action when it matters. It shows that he spent a month cold calling everyone he could think of, to try to get them to buy up his bad debts on the clan gathering.
One phone call today could cancel the small business bombshell and help the NHS. One more call could put £5 million of support into our games industry in Dundee. Those are the kind of calls that a real First Minister makes. I will even lend him my phone. Will he make the calls?
Iain Gray’s phone is not the best prop that we have seen at First Minister’s question time.
I point out to Iain Gray that the reason for the attempt to find someone to take over the gathering event was precisely to help the small businesses about which he says that he is concerned. I do not quite follow his argument. If he is concerned about those businesses, why does he criticise the attempt to have the gathering taken over? His position makes no logical sense whatsoever.
Iain Gray should, at some stage, face the reality of what was published this week about the finances affecting the health service and every other public authority in Scotland on page 16 of the budget report. It shows that £83 billion of cuts by 2014-15 are planned by the coalition Government at Westminster. It also shows for the first time that £52 billion, or two thirds of the proposed cuts were embedded in the Labour Party’s plans. Jobs will be lost in Scotland as a result of the coalition Government’s cutbacks, and the loss of two out of three of those jobs will be the result of the destruction of this country’s finances by the Labour Party. For every £3 million that is cut from every public service in Scotland, including the NHS, £2 million is the responsibility of the Labour Party. It is no good whatsoever—Iain Gray being a one-party, one-man political cycle—to cause the problem, destroy the country’s public finances and then to blame everyone else for the consequences.
Secretary of State for Scotland (Meetings)
2. To ask the First Minister when he will next meet the Secretary of State for Scotland. (S3F-2497)
I have no plans to meet the Secretary of State in the near future.
The First Minister has always demonstrated a casual and arrogant attitude to taxpayers’ money. Time and again I have challenged him to be more responsible with the public’s cash, and time and again he has rejected my advice, which is why the Conservatives have forced the Government to be more open with the taxpayer. Unfortunately, that was not the case as far as the gathering was concerned, and taxpayers certainly deserve some honesty today.
We know from the devastating Audit Scotland report that the Scottish Government made a secret loan of £180,000 to a company that is now in liquidation. When did the First Minister find out about that secret, interest-free loan? Did he authorise it? Was it his idea? If it was kept secret from him, does he now back the actions of his then Minister for Culture, External Affairs and the Constitution, Michael Russell? Was the loan even legal? Will he now apologise to the taxpayer for the whole sorry mess?
As was pointed out in the Audit Scotland report, we awarded support for the company under section 23 of the National Heritage (Scotland) Act 1985, so support for such events is legal.
The figures of £10 million for Scotland and £8 million for the boost in tourism revenue come from an independent assessment of the gathering’s impact on tourism. If Annabel Goldie wants to argue that officials were wrong to recommend the loan to the Minister for Culture, External Affairs and the Constitution and that he was wrong to decide to go ahead with the loan—to answer her question directly, I knew about it at the time—she will have to explain why she did not want the event to proceed. The loan was necessary if the event was to proceed because the company had cash flow difficulties and, without it, the event would not have gone ahead. If the event had not gone ahead, Scottish tourism would be £10 million worse off. Why on earth does Annabel Goldie think that it was such an unambiguously bad thing to ensure that an event that attracted so many visitors should go ahead?
The homecoming and the gathering were good ideas with good aims, but a laudable concept does not justify the Scottish Government playing fast and loose with taxpayers’ money. Let us look at who has lost out because of the mess: the police, the ambulance service, more than 100 small businesses and the taxpayer.
Quite frankly, the whole thing stinks, because the First Minister will not come clean about the secret loan. He says that he knew about it, but he will not say when he knew about it. He says that it was legal, but he will not give details of the legal advice that the Government received. He did not tell the steering group, he carried out no financial checks, but he still pumped in taxpayers’ cash. Why such a casual and arrogant attitude to the taxpayer? Will he come clean today? Will he tell the Parliament whether his Government has made any other secret loans to any other organisations?
Annabel Goldie should have listened to the answer to the first question before she blundered ahead with the second. I specified the act under which support was granted. I also confirmed that I knew about the loan. Of course, officials also told EventScotland, which chaired the steering group that Annabel Goldie referred to, about the loan. The culture minister approved the loan. Without the loan, the event would not have proceeded, which is presumably why, in evidence to the Public Audit Committee on 23 June, the Auditor General supported the fact that the loan was given.
I think that it is justified to support events that without any question generated substantial revenue and therefore jobs for the tourism industry of Scotland.
If Annabel Goldie is suggesting that I had some connection with the directors of The Gathering 2009 Ltd, I gently remind her that Lord Sempill—if my memory serves me correctly—once stood as a Conservative party candidate.
Cabinet (Meetings)
3. To ask the First Minister what issues will be discussed at the next meeting of the Cabinet. (S3F-2498)
The next meeting of the Cabinet will discuss issues of importance to the people of Scotland.
The gathering issue is about the financial behaviour and accountability of the First Minister’s Government. Can the First Minister confirm that The Gathering 2009 Ltd went bust with debts exceeding £0.75 million? Can he tell the Parliament how many Scottish businesses, including a major catering company in Perth, are still owed money? Some told me this morning that they have had to lay people off. Why, in particular, did the First Minister give the impression—or allow the impression to be given—to all the Scottish companies that were putting money into the event that their investment was safe and that his Government would pick up the tab?
I am not quite sure whether the argument is that the Scottish Government should have picked up the tab or that it should not have supported the event financially.
On the particular issue that is under discussion—the loan that was offered to and accepted by The Gathering 2009 Ltd, and approved quite properly under the relevant legislation—I point out to Tavish Scott that if the gathering had not proceeded and if the loan had not been offered, none of the revenue that was collected for the event would have come into the company, although substantial expense had already been made at that stage. Believe me, it would have been a bad thing for not just the economy of Scotland and Edinburgh, but companies across Scotland and Edinburgh, if the event had not proceeded. Those who criticise the offer of a loan to The Gathering 2009 Ltd had better come to terms with the fact, as Robert Black did in evidence yesterday, that in the circumstances at this time last year, that was perfectly proper and a “not unreasonable” thing to do.
Tavish Scott. Try again.
Mr Salmond just never answers a question. I asked three simple questions, but he does not want to answer any of them. Let me try some other questions. When Mr Salmond’s Scottish National Party Government authorised the £180,000, did ministers know that The Gathering 2009 Ltd was on the verge of bankruptcy? Did ministers ask whether the company was trading from an insolvent position? Does the First Minister recognise that that is a criminal offence? Does he recognise that any private business trading insolvently would be investigated by the tax man and could face legal proceedings? Does he accept that many Scottish businesses that are still owed money want a full regulatory investigation into not only The Gathering 2009 Ltd, but the conduct of his Government? Will he ensure that that happens, or will he obstruct an independent investigation?
I will take those questions in order. The loan to The Gathering 2009 Ltd was to address the fact that World Pay was holding a similar sum of gathering revenue that had been collected. Those were the specifics of the financial reason for offering the loan to help with the cash flow position.
If Tavish Scott had examined the Auditor General’s report, he would have seen that the reason for the financial failure of The Gathering 2009 Ltd was that it did not generate the anticipated revenue over the weekend that was in its forecasts. By definition, how on earth could we have known, before it had not gathered in the forecast revenue, that the company would become insolvent? That is why, no doubt, Robert Black said what he said yesterday—that it was a “not unreasonable” thing to do.
The Auditor General for Scotland is the independent investigator. When, after an independent investigation, the Auditor General—the independent authority—says to the Public Audit Committee:
“time was not on anyone’s side by the summer of last year ... the event was committed and was about to proceed. The Scottish Government”
took
“the not unreasonable view that in order to allow the event to proceed it should assist the short-term cash flow problems of the company”,
why on earth can the Liberal Democrats and Tavish Scott not accept the results of that independent investigation?
Tavish Scott, you have one more chance.
The First Minister is right about the public sector and Audit Scotland, but not about the private businesses throughout Scotland that are still in debt. Will he block an investigation by an independent regulatory body—HM Revenue and Customs or the Department for Business, Innovation and Skills in Whitehall—into why those private businesses are still in debt?
The body that the Parliament established many years ago to look at and investigate independently points of public interest in finances is called Audit Scotland. When the Auditor General goes to a parliamentary committee and makes the comments that I have quoted a number of times, why will the people who called for that investigation not accept the results?
He knows why.
He should answer the question.
Order, gentlemen.
Having a third attempt at a question does not mean that the third question will be any better than the first two. The remarkable aspect of the story is that the Liberal Democrats called for the Audit Scotland investigation. Now, having had the results of Robert Black’s investigation and having heard his comments yesterday, why can they not accept the verdict, response and detail of that Audit Scotland report?
Emergency Budget
4. To ask the First Minister what the implications of the emergency budget are for Scotland. (S3F-2499)
The United Kingdom emergency budget statement outlined the stark reality of the UK public finances left by the previous UK Government and, therefore, the sobering outlook for public spending and taxation.
Throughout Scotland, the impact of Tuesday’s announcements will be significant and will have implications for many years to come. The tax rises that the chancellor announced will impose costs on every household in Scotland, with the VAT increase alone forecast to cost an average household £380 per annum.
At the same time, we face huge constraint in public spending for at least the next four years and probably much longer. The exact implications for Scotland will not be known until the autumn spending review, but the scale of the challenge is shown by the chancellor’s indications for real-terms reductions in non-protected Whitehall budgets of 25 per cent over the next four years.
In my view, and that of the Scottish Government, cutting back faster and deeper than previously planned, with the additional £32 billion of spending cuts on top of the £52 billion that the previous Labour Government planned, puts economic recovery and jobs at risk. The position that we now face clearly highlights the urgent need for Scotland to take greater financial responsibility to give us the levers in order to grow the economy and best protect our vital front-line services.
The latest “Government Expenditure and Revenue Scotland” report shows us to be in a much stronger fiscal position than the UK as a whole, with a budget surplus of £3.5 billion over the past four years, compared with a UK deficit of £72.3 billion. Does the First Minister agree not only that Scotland is in a position to accept greater fiscal responsibility by way of a few modest powers reluctantly conceded by London some time in the future, but that the time is now right for Scotland to have full control of all its resources, including oil and all taxation and spending—that it is now time for independence? [Applause.]
Order.
It is remarkable that there are parties in the Parliament that seem disappointed at the statistical analysis of GERS, which shows that the budget balance in Scotland is positive for the fourth successive year—a positive balance of £1.3 billion in 2008-09, which gives a total of £3.5 billion over the four-year period—at a time when the UK built up a deficit of £72.3 billion.
It would be sensible for people across the chamber to reflect on the fact that that is a position that everyone in Scotland should welcome and should feel satisfied and pleased about, although it points up the fact that we do not get the benefit of those massive resources because that budget surplus flowed straight from Scotland to the UK Treasury in London.
Cancelled NHS Operations (Statistics)
5. To ask the First Minister whether the Scottish Government is satisfied that published figures on the number of cancelled national health service operations provide an accurate picture. (S3F-2510)
Some 98.5 per cent of all NHS procedures take place as planned. Data on the number of cancelled operations by the national health service show that in 2008-09, from a total of 1,159,145 hospital stays, some 15,913 operations were cancelled, which is a rate of 1.37 per cent. That is the same rate as in Labour’s final year in office. What has changed over that period, I am proud to say, is that the number of procedures that were carried out in NHS Scotland in 2008-09 was more than 800,000, which is the highest total since devolution and an increase of almost 40,000 since 2006.
Is the First Minister aware that, according to my local health board, more than six times as many operations were cancelled by hospitals in the NHS Fife area than were cancelled through patients not attending, yet only a fraction of those show up in the Scottish Government’s official figures, which count only patients who have already been admitted? Will he give an assurance that all the 20,000-plus operations in the past three and a half years that have been cancelled by hospitals throughout Scotland, including some 4,000 operations in Fife, will not be swept under the carpet? Will he end this hidden waiting list?
I do not think that Helen Eadie should talk about things being swept under the carpet in the context of statistics in the NHS. As she might remember, this Government has abolished Labour’s hidden waiting lists, which indeed swept things under the carpet.
The information on patients not attending has never been published by the NHS until now. It was never published all through the years of Labour control, as Helen Eadie might wish to remember. However, I am delighted to say that that information is now being collated. The figures for nine months, from 1 July 2009 to March 2010, show that 9,541 patients did not attend their appointment. All of us should agree that that is a serious issue. Equally, I hope that Helen Eadie will agree that we should welcome the fact that the data are now being collated for the first time, which seems to me to be one of the prerequisites for action to try to reduce that figure.
If Helen Eadie is correct and the total number of cancelled NHS operations is understated, does that mean that the cost of cancellations is also understated? If so, by how much?
Given that the data have only just started to be collated, it follows that that question is impossible to answer until the data are fully collated. I am sure that Ross Finnie will join me in welcoming the initiative to collect those data.
Research Institutes (Funding)
6. To ask the First Minister what steps the Scottish Government is taking to ensure that the Moredun Research Institute and other research institutes in Scotland are best placed to secure future funding from the European Union research framework programme and elsewhere. (S3F-2508)
I welcome that positive and well-timed question.
The Scottish Government is well aware of the global reputation for excellence of our research institutes. They receive about £50 million per annum from the Scottish Government and we work with other research funders to secure additional funding and to ensure that our research institutes are well positioned to secure European funding. I am sure that the member will join me in welcoming Richard Lochhead’s announcement on Tuesday of a €9 million research grant—the largest-ever grant awarded by the European Union in the field of animal health—that the Moredun Research Institute will co-ordinate, from which it will receive almost €1 million. The Government is firmly behind the global achievements and reputation of the Moredun Research Institute. Although we all face challenges in these difficult times, our commitment to that expertise remains absolute.
I thank the First Minister for his commendation of my question.
Over the past 15 years, animal disease has cost the UK economy around £15 billion. The Moredun Research Institute is engaged in research that in future could reduce that figure by a quarter, so although the record grant that it secured this week is richly deserved and is testimony to the continued excellence of our world-class research base, we dilute that excellence at our peril.
The First Minister will be aware of the serious concerns that researchers, vets and the Scottish agricultural industry have raised about his Government’s approach to future scientific research funding. It has been suggested that that approach
“could undermine the pioneering efforts of the Scottish livestock sector in the area of animal health.”
Can the First Minister therefore confirm that his Government will not now seek to flatten and broaden the research that Moredun carries out? Will he undertake to ensure that collaboration across the sector is not achieved by squandering the specialist excellence that delivers real economic value for Scotland, which has the potential to leverage in the sort of record grant award that we have seen this week?
I will deal with the question in two ways. As I said, the research institutes receive funding of £50 million a year from the Scottish Government. We intend to continue that level of funding over the period to 2016, subject, of course, to the spending review.
I am sure that, like all other Liberal members, the member will wish to join me in explaining to the new Chief Secretary to the Treasury how important that vital funding is on that and other matters, and I am sure that he will acknowledge and accept that, given that the Chief Secretary to the Treasury is a member of his political party, the days of absolving the Liberals of responsibility are over.
As far as the Moredun Research Institute is concerned, I indicated how much I appreciate its work, so it is only appropriate for me to quote John Jeffrey, the institute’s chairman, who said yesterday:
“Moredun’s international reputation for livestock health research is only possible because of the investment by the Scottish Government ... into maintaining the skills and facilities that are based at our site in Midlothian. I am delighted that Moredun can continue to deliver practical outputs that are needed by farmers, veterinary surgeons, processors, retailers, and the public, not only in Scotland but across the world”.
The member’s question was well timed indeed, given the excellence of Moredun and the magnificent boost that it received only this week.
On a point of order, Presiding Officer. I am sure that the First Minister would not wish to mislead the Parliament. He claimed that the GERS figures showed that Scotland was in surplus, but they do that only if spending on schools, hospitals and roads is not included. It is not that long ago that the SNP was claiming that the GERS figures were fiddled; he is the one who is fiddling them.
I think that Mr Whitton knows that that is a debating point and not a point of order for me.
12:32
Meeting suspended until 14:15.
14:15
On resuming—