Spending Review 2004
We move on to the debate on Andy Kerr's statement on the spending review. The debate will conclude without any question being put.
I thank the minister for his statement and for providing an advance copy of it. I welcome aspects of it, as do we all, but I do so with the caveat that the devil is in the detail, which has yet to become apparent, even after all the clarification.
Members of all parties could make more considered and useful speeches if the debate were held some days after the statement was made. The arrangement must be changed. It is nonsense to have so little time for questions on the statement and no time for a more considered reaction later.
Does the member agree that it is also ridiculous that the minister does not answer any of the questions that are asked?
I am responsible for my questions, but not for the minister's answers, unfortunately.
I welcome the increased investment in higher education in particular. When I was the Enterprise and Culture Committee's convener, the committee called for such investment to maintain that sector's competitive advantage, especially in its high-quality research base. The sector is fast moving in the United Kingdom and internationally. We will have to continue to monitor its performance, especially as the full implications of top-up fees south of the border become more apparent—that has not happened yet.
I also welcome the increases in the tourism marketing budget and in the air route development fund. Tourism is our single biggest industry and we need to invest more in it, although I suspect that we are still not matching the investment levels of some of our competitors. Finally, I welcome the increase in allowances for foster carers, who are an undervalued group and are in increasingly short supply. They certainly deserve whatever increase in allowances the minister is going to award them.
The trouble with such ministerial statements is that they always have an element of "Never mind the quality, feel the width" about them. The statement that we have just heard is no exception. We are asked to wonder in amazement at how the Scottish budget will increase over the next few years, and at how it has increased in the immediate past. That is all conjured up for us by the partner of Mr Blair's labours.
We should bear something in mind when we are asked to marvel at how much money is being spent in Scotland. The minister said that the increase up to 2008 would be in the region of £5 billion. Taken in isolation, that is a huge sum, but the annual Government revenues from North sea oil for even one year—2002-03 for example—were £4.9 billion. Those oil revenues are certainly set to continue in that vein, or be even higher in future, and some of us think that we should not be quite as grateful for simply getting back a part share of our own money and taxes.
Irrespective of my base ingratitude—indeed, in a similar debate two years ago, Mr Kerr said that I was "whingeing"—there have been substantial increases in the budget. One would have thought that, after seven years and four months of Mr Kerr's party being in power in Scotland, one would have seen some fairly remarkable results from all the expenditure in question. Listening to Mr Kerr today, we would think that everything was wonderful, but if the man or woman in the street considered the health service, for example—which we will debate tomorrow—they would wonder where all their money had gone. As far as the average voter is concerned, the money input to the budget is not important except in so far as it affects the taxes that they must pay. The outcomes of Government spending are what is important, rather than the amount spent. The important things are the waiting lists, the location of a person's nearest hospital and the ability to register with a dentist.
We cannot know what outcomes the spending review will deliver. We can, however, evaluate past performance and we would do well to look at some of the promises that were made in the equivalent speech on 12 September two years ago. In announcing the previous spending review, the minister said about the health service that
"This budget delivers for health"
and that it will
"deliver much needed improvements directly to front-line services."—[Official Report, 12 September 2002; c 13669.]
If the minister wants to check that, he will find it in column 13669 of the Official Report. Perhaps he should send a copy of that speech to his Westminster party colleagues, who had to summon the Minister for Health and Community Care to explain how they had missed out on what had been delivered. Perhaps that speech should be printed to hand out to the hospital campaigners who now feel that they have to lobby the Parliament on such a regular basis. Perhaps he should have given it to his colleague Brian Fitzpatrick to use in his election address.
The minister made another promise at that time when he said:
"Our three-year commitment is to make our streets safer and cleaner, to reclaim our parks and open spaces and to tackle vandalism, graffiti".—[Official Report, 12 September 2002; c 13671.]
That is another good one. To be fair—and I am always fair to the minister—that three-year commitment was made only two years ago. However, it leaves an awful lot to do in the next 12 months. We look forward to seeing what happens.
Another trick is to work in reference to projects that the Executive may start thinking about during the period of the review, but not to make the timescale clear. The previous statement managed to bring in the Edinburgh and Glasgow airport rail links—they are in the statement again this year—the M74 extension, the A8 and the A80 conversion to motorway, which the minister did not even mention this time. Perhaps they have been built and I have not noticed. In fact, the minister's previous speech was full of the word "deliver", but once again, the minister confused the delivery of expenditure with the delivery of a desirable outcome as a result of that expenditure.
The Executive and the Opposition are agreed that, no matter how much money one spends, or how effective the expenditure is, the governing factor on how successful one will be is the health of the economy. Both the Government and the Opposition are on record as being committed to achieving Scottish economic growth, but we differ significantly on how to achieve that. In his statement two years ago, Andy Kerr said:
"I want the focus of the debate to be on what those plans will deliver and the impact that they will have on growth".—[Official Report, 12 September 2002; c 13666.]
Missing from that statement was any indication of what exactly, or even roughly, the impact on growth would be or what growth target the Executive had set itself. Today's statement is precisely the same. Perhaps that is just as well given that, two years on from his previous statement, Scotland's growth is flat-lining. We still lag behind the UK and we are left out of sight by the small European countries that we should seek to emulate. The fact is that the minister's powers and the levers that are available to him do not allow him to get to grips with the problem of lack of growth.
In conclusion, the Executive's failure thus far has been twofold. First, its expenditure has failed to deliver and no evidence has been given to make us think that things will be any different over the next two years. Secondly, it has failed to develop any strategy to give us the long-term growth that will sustainably generate the required resources into the future.
I thank the minister for being generous enough to make available copies of his statement beforehand.
The media might not rate Andy Kerr highly, but I say to my friends in the press that he is anything but naive. He is no political mug or novice. He and his boss are cut from the same cloth: they are machine politicians. They know that the largesse from Gordon Brown's Barnett bounty cannot go on for ever. A day will come—it is getting nearer all the time—when the spending will not climb, but stall and then fall. Do not take it just from me, as if I were just some doomsayer. Similar warnings have come from respected Scottish economists such as Professor Arthur Midwinter and Professor Sir Donald MacKay.
It is noticeable, for instance, that Gordon Brown's estimates for spending increases at a rate that is greater than the trend rate of growth—in other words, beyond the wealth that we generate—end after 2007-08.
Will the member give way?
No, I must make progress.
Faced with the spectre of spending cuts, which will be cuts not just in spending growth but in the total amount of spending available or, in other words, lower real-terms expenditure than in previous years, the Minister for Finance and Public Services has made the calculation—a political calculation—that it is better to spend money on capital projects that can be delayed, postponed or easily cancelled when those cuts have to be faced. He has chosen to do that rather than make too many financial commitments on public services that will be embarrassing, if not unacceptable, to cut.
The Labour and Liberal day of reckoning—a reckoning not of the political sort but one born of the laws of economics—will come because Scotland is living beyond its means and the Government is spending money that we are not earning. We will move into a spiral of decline, as the suffocation of our private sector produces a fall in tax revenues that results in less money being available to spend. At that point, the only alternative to spending cuts will be greater borrowing or higher taxes. There is little room for higher borrowing, so higher taxes there will be. Yes, there has been some economic growth, but we can see where that growth has taken place. For all the valuable work that they might do, the extra public sector workers do not create wealth but consume it.
Let me give an example from the minister's announcement in the Sunday papers. It is high farce, if not absurdity, for the minister to crow about the millions that he is being forced to put into higher education. He has done so not because the Executive believes that it is an intrinsically good thing—for months, various ministers resisted the notion—but because the Executive has had to bail itself out of a disaster of its own making that has occurred with the replacement of tuition fees in Scotland with the graduate tax, and the introduction of top-up fees in England. Scottish Tories would not need to spend that money, because our policies would not have created the gulf in funding between universities north and south of the border, and our current policies on higher education funding would ensure that the sector is adequately resourced and that students are better off.
Then we have the brazen claim that the Executive is spending squillions on transport as the solution to all our transport problems, when in fact it delayed the Kincardine bridge, the M74 upgrade, the M8 completion and the M80. The Executive is using taxpayers' money to make right the wrong decisions that it made five years ago.
Conservative members offer a different vision: a Scotland where there are incentives to work hard and build a business, where endeavour is rewarded, where a growing, productive economy pays for the level of public services that it can afford, where the Executive gets off the backs of the Scottish people and Scottish business and where the Government lives within its means. We would swing the axe and cut, cut, cut. We would cut Scottish business rates by 10 per cent to give us an advantage over the English level; cut council tax by 35 per cent; cut waste, bureaucrats, Executive advertising and failed initiatives; and cut ministers and their limousine lifestyles.
If there is obesity in Scotland, it is in the Executive. I say that with a smile on my face. The lesson that the Executive must learn is to stop gorging on the taxes of Scotland and to start slimming down. A leaner, fitter Government would be an excellent example for us all to follow. We are all looking for that lead.
The day of reckoning will surely come for the Executive; it is as certain as Hibs' entering the Scottish cup each year and its outcome is as predictable—failure and defeat. This is not a budget that will bring prosperity, but a budget that will lead to the defeat of the Executive.
Liberal Democrats are changing the way in which this country is run. In the words of Jo Grimond, we are developing a common welfare in society. In his book of the same title, Jo Grimond asked how we
"enable individuals to exercise choice and achieve value".
He challenged the current tendency for the individual to be regarded more and more as a member of a trade union, a single parent, an old-age pensioner or a member of this or that profession, so that the role, not the individual, became important.
In the Parliament, we have become obsessed with the role, rather than the individual. We have become blinkered by our role in the economy, society, the professions and the constitution. I reject that acceptance of illiberalism and the underlying concept that we should judge the budget statement—how we divide the taxation yielded by common endeavour and the priorities that we set—by our constitutional status.
The chamber will be aware of my proposals for fiscal federalism. Those are not steered as part of a constitutional debate, in order to find common ground—a halfway house or a happy medium. Our fiscal system should be a means of implementing political choices, choices that we debate today. Under the powers of the Parliament and within a UK framework, we have made choices to invest in public services and infrastructure. We are debating the merits of those choices, and other parties must also enter the debate. A debate can take place only when there are counter-proposals. It is not good enough for the SNP to make spending announcements only during a leadership election and not in this place. Mr Morgan said that he needs time to consider the implications of the minister's statement, but the SNP has had five years to consider the implications of spending reviews in Scotland and to propose alternative plans, and not once has it done so.
The test by which I judge the statement is how it allows individual citizens to exercise choice and achieve value. The choice is not between private or public, nationality or role in society, but choice for their lives, for citizens' ability to develop their latent potential and to achieve value for themselves and their community through Government provision of investment and support—the common welfare.
The spending review that we debate puts in place the long-held commitments on the environment, people and skills, health promotion, transport, housing and the health service that Liberals have espoused for many years. There is value within communities with the highest sustained investment in higher and further education in history, taking support in that area to over £1 billion for the first time ever. There is also value in the aged and vexed issue of providing homes for our people. The commitment of £1 billion over three years for housing in Scotland will make a direct difference to people's lives and will have an effect far beyond what can be summarised in newspaper headlines.
In 1974, the year I was born, the town of Galashiels, where I now live, had the highest proportion of outside amenities for houses in Scotland. Our contribution to the common welfare of the next generation will be bestowed through improved housing stock in every community and in every area in Scotland.
Scotland is investing in infrastructure: in local roads and rail, by generating new international air links and delivering our 10-year transport plan. Investment in our infrastructure is this Liberal Democrat-Labour Executive's commitment to literally building an environment in which businesses can thrive in society, where they can ship their goods and their staff can arrive for work freely and more conveniently. With genuine commitments to improve the health of our work force and our people and the schools of our employees, we will improve productivity. What alternative approach is there? There is none.
Does Mr Purvis agree with Mr Kerr's assessment of the economy or with his federal leader's assessment of the economy—that Gordon Brown is making a hash of this country's economy?
It is within the powers of this Executive to create an environment in which Scottish businesses can grow. It is by improving our human infrastructure that we make the biggest commitment to improving the economy of Scotland. It is our ability to allow individuals to play their full part in society and the economy that will be the real test of the ministerial statement.
Can the member tell me what powers are available to the Executive to grow the economy that were not there before devolution?
It is within the ability of this Executive to fund early-years education, making it universal for all three and four-year-olds. That is a political choice under this Liberal Democrat and Labour Executive, as is funding later starts in primary education and 53,000 teachers in Scotland in brand new refurbished schools for 150,000 children, many of whom are in my constituency. I say to Mr Crawford that those are political choices; they are not constitutional choices. If SNP members engaged in the debate about political choices, it would advance their cause no end.
As well as improvements to early-years education, there is to be a radical increase in further and higher education provision. In a welcome Executive response to the Finance Committee, we learned of additional capital expenditure with a 40 per cent increase over the lifetime of this budget in this Parliament. I look forward to a capital programme that puts us on a par with equivalent nations and which also invests in our future.
We cannot rely on a single source of income to fund our common welfare, as Mr Morgan asks us to do. Over the past 30 years, oil prices have fluctuated by less than 5 per cent in only three of those years. Providing the basis of individual choice, and freedom of the individual as part of the community, and funding our common services as well as the future of our public services in Scotland, cannot be done on the principle of double taxation of corporation tax over one finite resource. Nor should the debate be framed solely by the constitution, but rather in the belief that while we share the benefit of the yield of our common endeavour in Scotland to invest in our infrastructure, we are challenged by our opponents, from the left or the right or by nationalists—[Interruption.]
The SNP cannot decide whether it is on the left or the right. Mr Mather and Mr Morgan might give a very good impression of being on the right, but every single member who sits behind them wishes to spend more and more money in Scotland.
We need to invest in the common welfare of our society. If people on the right or left challenge us that, as Mr Morgan suggests, the money is not being spent or that, as Mr Monteith suggests, there is too much money to be spent, then they need to suggest alternatives so that we can debate them in the chamber. I make a plea in this chamber that we know the sum total of Mr Monteith's cuts, cuts and more cuts. In fact, I would welcome such a statement as much as I welcome the statement by the Minister for Finance and Public Affairs on investing in our future in Scotland.
Listening to Brian Monteith, I wondered whether the Tories should get their Alex Fergusson to sign up Wayne Rooney. Given some of the approaches that they have suggested, he could hardly do worse than they did.
But he scored a hat-trick last night.
He did very well last night; the Tories have not been doing so well.
I am interested to find that the Conservative and SNP responses to the statement are ones of denial. The SNP says that all the additional spending is not really making a difference, while the Conservatives say that such spending cannot go on for ever. Neither response acknowledges the achievements that have been made since 1999. For example, in 1999, none of us could have expected spending on public services in Scotland to double; however, that will be achieved by the end of the spending review period. No major developed country in the world can match the growth in the UK economy over the past eight years, which is all thanks to the sensible and far-sighted management of the economy. These spending plans demonstrate that nowhere will benefit more from the certainty and stability that underpins these economic achievements than Scotland.
Will the member give way?
During the 1980s, which is a time that Mr Monteith alone harks back to, we experienced denied opportunity, high and increasing unemployment and a dearth of investment in schools, hospitals and new houses. Perhaps John Scott would like to justify that.
Will the member tell us the growth rate for the Chinese and Indian economies, which far outstrip the UK economy?
I was talking about major developed countries. I think that the member will find that China and India are developing countries. Never mind.
Inevitably, it took time to overcome those 18 years of indifference, unfairness and neglect. Since devolution, more and more resources have been devoted to education to meet the needs of the most vulnerable people in society and to build the foundations of a dynamic, modern Scotland.
Unlike Alasdair Morgan and Brian Monteith, I have been able to have only a brief look at the spending review. The Finance Committee made a number of specific suggestions about the key priorities for Scotland. We were right to question whether resources were being adequately directed towards delivering the Executive's top priority of economic growth. In that respect we highlighted a number of areas, including further and higher education and transport, in which more resources were needed.
In response, the Executive has increased spending on transport by 42 per cent and spending on further and higher education by 31 per cent over the next three years. Spending on economic development has grown by £1.6 billion, which over the period amounts to 25 per cent of total spending and 33 per cent of spending growth. This is all progress in the right direction for the stable, progressive and dynamic Scotland that we all want and I say to Mr Morgan that such spending will deliver significant results.
The Finance Committee suggested that the Executive should increase its share of spending on capital. In that respect, £900 million has been made available, which is a 40 per cent increase. Such a step goes way beyond the golden rule that has governed spending in the past and represents significant change.
In their reports to the Finance Committee, the subject committees highlighted capacity problems in health and education. Again, substantial additional money has been found to provide extra teachers and health workers and to meet the capital costs of new buildings and equipment. However, although those things are urgently needed to modernise the health service, most of the Opposition parties appear to oppose certain elements of those policies.
We also highlighted the importance of housing and regeneration. Again, significant additional amounts of money will be made available for affordable housing.
Those are not bad things. Members cannot deny that those things will happen. The money is available, it will be used and I believe that it will be used effectively. I highlight the extension of free travel to pensioners throughout Scotland. That is only one partnership commitment, but it is one of many that will be delivered through what is being provided in the spending review.
I agree at one level with Alasdair Morgan: it is not only having the money to spend that is important; it is how it is spent and how best use is made of it. I was encouraged by the undertaking of the Minister for Finance and Public Services that resources will be used effectively and will reach the direct providers and the users of services. That is crucial. We cannot have a situation in which additional resources that are being made available by the Executive are not delivering real change for the people who need to benefit. That is fundamentally what government is about—we all share an interest in that.
That is in contrast to the SNP's approach which, according to the manifesto of Alex Salmond and Nicola Sturgeon, promises several new administrative overheads. For example, there would be a foreign affairs ministry, an autonomous Scottish broadcasting corporation and a Scottish pensions agency to administer the citizen's pension, which frankly would be unaffordable if we move towards an impoverished Scotland following independence.
The Conservatives' proposal is to recreate health trusts. We abolished 47 health trusts and reduced the number of senior managers in the health service while we simultaneously increased the number of health professionals. There has been a 10 per cent reduction since the days of the Conservative Government.
Does the member seriously think that a Caithness health trust, established by the Conservatives, would, if it were around today, be ordering women in Wick to go to Inverness to have their babies? Does he think that a West Lothian health trust, if it existed today, would transfer all the emergency services in St John's hospital in Livingston to the Edinburgh royal infirmary? Those health trusts were sustaining local services that the Labour Party is closing down.
No. The trusts were an unnecessary tier of bureaucracy, which the Conservatives want to reintroduce. That is what we oppose. We are opposed to wasting money. We want to spend money usefully. That is the difference between the Conservatives and Labour.
I have to add my voice to Alasdair Morgan's complaint about the format of today's proceedings. This debate was preceded by a statement, after which we were allowed five minutes for clarification, during which time the minister was unable to answer one question. We have had barely a few minutes to digest the statement. I hope that we can come back to the topic in the very near future to have a proper debate on it.
The constituencies of some of us are about 100 miles away from the Parliament and from the minister, Andy Kerr, but listening to the rosy picture of Scotland that he painted today I have to say that those constituencies might as well be light years away from him. The reality on the ground in the communities that we represent is that people complain every day about the impact on their communities of cuts in local government spending. We hear of local hospitals in which a quarter of the medical equipment is beyond its standard life and there is a desperate need for it to be replaced. That has been the situation over the past seven years of the new Labour Government. The voluntary sector is also scraping around for every penny that it can get.
The picture in our communities is a far cry from the picture outlined by the minister in his statement. The key with the huge budget—compared to what we have had in past years—is to ensure that every pound makes a difference on the ground in our communities. After the first five years of devolution, the signs are not encouraging, because the Executive's record is appalling.
Since devolution, the Executive's budget has increased by about 50 per cent, yet the poverty figures that the Department for Work and Pensions put on its website a few days ago show that relative poverty among pensioners in Scotland has decreased only from 41 per cent to 39 per cent. When the Scottish Parliament was established, the figure for relative poverty among children in Scotland was 40 per cent, but last year—the most recent year for which figures are available—the figure was still 40 per cent. Again, during that period, the Scottish budget has increased by 50 per cent. That is an enormous increase and it does not take into account the increase that is expected over the next two to three years. It is clear that the Scottish Government is getting something seriously wrong.
It has to be said that, over the same period, the Scottish economy has grown by only 8 per cent, whereas the United Kingdom economy has grown by 13 per cent. I would have thought that economic growth in Scotland would have been one of the Government's main objectives with its multibillion-pound budget.
Unlike Jeremy Purvis, I did not stay up all evening to craft the perfect speech to outline my party's political philosophy.
I see that Jeremy Purvis wants to intervene. Perhaps he just got up very early this morning.
I have tried to respond to some of the issues that the minister raised in his statement, because many sectors in our communities are crying out for attention. The minister said that £1 billion would be invested in housing during the next three years and all members hope that that will make a real difference on the ground, particularly in rural communities. It has taken five years—seven years if we consider new Labour in the United Kingdom context—for ministers to wake up to the housing crisis in Scotland. At last they have done so. I appeal to the minister to ensure that the money is not simply transferred into the pockets of landowners, who charge a fortune for land. We must ensure that the minister's objective is to use that £1 billion to build lots of houses. We must help first-time buyers in cities as well as in rural areas.
I would have expected the minister's statement to mention water infrastructure, which is a huge, pressing issue throughout Scotland, given the development constraints, but the issue was not mentioned. In fact, the minister had the cheek to say that the Executive has achieved
"record levels of investment in the water industry to meet European standards".
As far as we are concerned, consumers, not the Government, are paying through the nose to raise those standards. Capital assistance must be given to help to improve the water infrastructure throughout Scotland. I am not just talking about domestic customers; I refer to small businesses, too.
Ministers must announce proposals on the rural economy during the next few days. I mention the fishing industry because last year—believe it or not—there was an underspend in the budget of £12 million in relation to the aid packages that had been announced for the industry. Apparently that money has disappeared into thin air. Since the Liberal Democrat-Labour coalition Government came to power in 1999, fishing employment at sea has been reduced by 27 per cent and fishing employment on shore has been reduced by 54 per cent, yet last year the minister managed to achieve an underspend of £12 million. [Interruption.] I hope that ministers are listening, because I am trying to raise important issues. Ministers must bring back that investment in saving coastal communities.
The minister's statement made no mention of the renewable energy industry, which perhaps offers the biggest potential for growing the economy in Scotland and tackling climate change. The industry has the potential to be a key driver in the Scottish economy in the years ahead. That appalling omission must be rectified, because millions of pounds will be have to be invested in the industry if we are to make the most of it. We must get ahead in the coming years and not be left behind, as we were in the development of the oil industry and other industries in Scotland.
The minister said that £4 million would be invested in overseas promotion every year, which perhaps represents a small step forward. A few months ago, however, I visited a local council in Paris that has a budget of £2 million or £3 million for international aid alone. The Scottish Executive's ambitions are limited to £4 million per year for the promotion of Scotland overseas. We should be more ambitious about establishing a network overseas. For a few million pounds, the Flemish have 77 offices overseas to promote the Flemish economy. No such ambition is outlined in the minister's statement.
Perhaps we will be able to bring real change to Scotland when we have a minister who can stand up and deliver a proper budget because he has all of Scotland's resources at his disposal and all the powers at his disposal that ministers of every normal country in the world enjoy.
I intend to call as many back benchers as I can, so I would be grateful if members would stick to six-minute speeches.
Budget statements and budget debates in the Scottish Parliament are rather bizarre affairs. The minister comes along, announces his spending plans with great aplomb and proudly tells us how much he will do for the different sectors. However, with the exception of the business rate, which I will talk about, the minister has no control over the total size of his budget. All he does is divvy up the cake between the different spending departments. For all his pride in the sums that he has to spend, Mr Kerr can take no credit for the size of his budget. He is a bit like the small boy in the playground who runs around proudly telling his pals that he earns more pocket money than they do, because his parents reward him more generously. The amount of his pocket money has nothing to do with how good or bad a boy he has been; it is just the fact of the matter. It would make no difference if Mr Monteith or Mr Morgan were Minister for Finance and Public Services, rather than Mr Kerr.
Oh, come on!
I should have said that it would make no difference in terms of the amount of money that was available to spend.
It is important to put all these trumpeted achievements in context. By 2008, the Scottish Government will, in terms of the amount of money that it has to spend per head of population, be the richest Government not only in Europe, but in the entire world—with one exception. That exception is, of course, the Vatican City, which has a population of 740, most of whom are clerical. I do not think that the Vatican City can be compared accurately with Scotland, not least because it does not have the same bills as we do for child care or pre-school education.
If, by 2008, we have world-class expenditure on our services, will we have world-class outputs? Where is our world-class health service? Where is our world-class education? Where is our world-class transport? It is patently obvious to anybody who travels round Scotland that our outputs are nowhere near world class. The question for the minister and the Executive is: if so much money is going in, why is it not coming out at the other end? Why is it not delivering the world-class services that people would expect, given that we are very near the top of the expenditure league in Europe and, indeed, the world?
As members know, I have raised the issue of business rates on several occasions previously, because it is the number 1 priority for people in business. As we all know, Scottish businesses are paying a rate that is 7 per cent higher than in the rest of the United Kingdom. The minister said that the Executive would ask business for its views on the options for using business rates to incentivise company-driven growth and productivity. I ask the minister not to waste any time on that, because I can tell him what business people will say. They will say that they want a cut in business rates. Every representative organisation in the business community has been saying that for the past five years, ever since Mr Kerr's predecessor broke the uniform business rate.
In an earlier intervention, my colleague Brian Monteith raised an important point. If one says that the UBR will be pegged to inflation, which inflation measure will be used? The retail prices index? The United Kingdom Government's preferred measure of inflation—the consumer prices index—is, in fact, much lower than the RPI. Therefore, if business rates go up with the RPI, businesses will be penalised yet further.
We have heard previously from the minister that business rates work out the same north and south of the border because we have lower rateable values in Scotland. That claim is misleading for three reasons. First, as the minister is well aware, there is a move to equalise the basis of rateable value north and south of the border. That is an on-going process. Secondly, in a number of sectors, equalisation has already taken place—in fact, in a number of sectors, the basis of valuation in Scotland is already higher than it is down south. I will give two examples. In the hotel sector, medium-sized hotels are already rated more highly than their counterparts down south, so owners of those businesses are being penalised twice—first, with a higher rateable value and, secondly, with a higher rate poundage. For my second example, I am delighted to see that the minister is holding a glass of Strathmore water. Is he aware that water bore holes in Scotland are rated? Strathmore is paying business rates for the water that the minister is about to drink, whereas its equivalents down south are not rated. Ashbourne in Derbyshire pays nothing for its water supply. The minister is penalising Scottish business over and over again.
The third way in which the minister is wrong is that his claim is disproved by his own study. The document "Comparative Study of Business Tax Revenue", which Scottish Executive economists published at the end of last year, assesses the level of business taxes as a percentage of gross domestic product. The study said that, as a percentage of GDP, business property taxation—that is, business rates—was 2.1 per cent in Scotland and 1.8 per cent in the UK as a whole. That demonstrates that business rates in Scotland are 17 per cent higher than they are in the rest of the UK and it disproves the minister's contention about business rates.
The minister will no doubt say that, if the study document is taken as whole, it shows that business taxation equalises across the UK. However, the flaw in that argument is that the document assesses business tax as a percentage of GDP. Because the public sector in Scotland is so much larger than that in the rest of the UK and because the private sector so much smaller, if business taxation is the same north and south of the border as a percentage of GDP, it will be higher for each and every business in Scotland. If the minister seeks to use that document to justify his business rates agenda, he is sadly mistaken.
Let me say in closing that, for all the fine words of the Minister for Finance and Public Services, all he is doing is dividing up a cake. There is a woeful lack of delivery in public services and the minister has missed an opportunity to deal with business rates. If he is serious about growing the economy, he will have to listen to what business is saying and cut the rates.
As the Minister for Finance and Public Services made clear, today's statement puts a welcome emphasis on investment in universities, transport, education and planning for the long term. As Des McNulty pointed out, the sheer scale of that investment presents a problem for the Opposition. That was evidenced by Murdo Fraser's speech, more than half of which was devoted to business rates. There will be a special statement on business rates later in the year, but today we are discussing the spending statement.
As is my custom these days, I will dwell on some of the bigger questions that the spending statement poses. Today's spending review bursts on to the Scottish political scene in days that are dominated by the party conference season and leaders' speeches, with their definitive statements about their political parties' ideas, direction and vision. Yesterday, the Prime Minister confirmed that Labour's spending plans are about making child poverty history; the Minister for Finance and Public Services echoed that today in the chamber. We have already lifted one in four children out of poverty and are on track to halving child poverty in the period covered by this spending review and the next.
I will ask a former minister a question that I asked the minister. How many children in Scotland are still living in poverty?
I made it clear that we have lifted one in four children in Scotland out of poverty and that we will halve the number of children in poverty during the course of this spending review and the next—a mere half dozen years. The number of children lifted out of poverty in the United Kingdom is more than 600,000 and the number up here is more than 100,000.
Health is the other issue that has been dominating Scottish headlines. As was also made clear yesterday, we have a commitment that, regardless of how poor people are, they deserve the best care according to their needs. When it comes to spending plans, people know where Labour's priorities lie both north and south of the border. Today Scotland follows the rest of the UK in becoming one of only two nations in the whole of the European Union that is raising the share of national wealth that is being invested in health and, at the same time, in education. That is a success story for the financial arrangements under the Scottish Parliament, whereby spending has doubled since the Parliament came into being.
Of course, budgets are about choices, so I will spend some of my time contrasting our plans to abolish child poverty and to provide the best publicly funded health service in the world with the other leadership speech that has been made in the past few days by a London-based party leader—Mr Alex Salmond.
Salmond's speech was an altogether stranger affair. The sour soundbites were all too predictable, but where were the plans for Scottish spending or the Scottish economy? In an hour-long speech, there were no soundbites on the Scottish economy and there was total silence on fiscal autonomy—the SNP's financial flagship did not even merit a footnote. Given that fiscal autonomy has so recently been found out, perhaps it is now being airbrushed out of nationalist history. Last week, the Scottish Parliament, which is so maligned by that same London-based leader, posed a question that he could not answer. It asked whether there was one other federal or devolved country anywhere in the advanced world that had opted for fiscal autonomy as the best way of managing its finances. We are still waiting for an answer: the silence is deafening and the suspense is killing us.
Alex Salmond is an artful tactician but an awful strategist. He has returned to his roots by denigrating devolution and dismissing the Parliament. Some things never change—when the SNP gets found out, it does its usual thing of pouring oil on troubled waters, no matter that that did not work in the 1970s and will not work now.
Here is a second question for the SNP team. Can it name just one oil-rich advanced country or province that uses volatile oil revenues to balance the books? The answer is not Norway, nor Alberta, nor any of them, because they know better than to bet their health services on oil prices. Oil revenue might be £7 billion this year, £4 billion last year and £2 billion five years ago, but it cannot all be used to balance the books. Last week, Alex Neil likened oil revenues to winning the lottery. It is fine to win a lottery, but one cannot bet with the national health service budget by relying on the price of oil, the dollar exchange rate or the level of terrorist anxiety to fill the coffers.
Will the member give way?
The member is in her last minute.
We look forward to hearing the missing spending plans of the nats.
In the time available to me, I will not be able to deal with Michael Howard, although we can guess that there will be guarantees of cuts, charges and privatisation—insurance for some, insecurity for all. So let me move on and simply ask Murdo Fraser to explain, if he is worried that our doubling spending on public services is crowding out the private sector in Scotland, why a higher proportion of Scottish employees were employed in the public sector during each of the last four years of the Tories' Administration than has ever been the case since devolution. The reason for that is, of course, that we do not waste millions of lives or millions of pounds on the dole.
I end with a big question that befits a big debate. The spending review is rooted in the right values—it looks to the long term—but, as the Prime Minister said yesterday, we rarely fail because of the weakness of our values; we fail when we do not understand the context of those values. In Scotland, we in the coalition need to share the restless courage of the rest of our party in acting on the coming reality.
I welcome the opportunity to contribute to this important debate on the Scottish Executive's spending proposals for the next three years. The proposals should come as no great surprise to anyone. Alasdair Morgan and Richard Lochhead were concerned that they did not have time to consider the minister's statement in any great detail, but there should be no surprises in the proposals, because the spending review is about delivering on the partnership agreement, which was published and debated more than a year ago.
The SNP and the Conservatives should have no difficulty in bringing forward alternative spending plans that list what they want to do. That is what they should be about in such debates—not criticising the Executive for going ahead and producing its spending proposals, but providing constructive opposition. We would welcome Richard Lochhead bringing the SNP's spending proposals to the chamber for debate. I would welcome the opportunity to challenge them. If the SNP used some of its debating time constructively and brought forward its proposals, we could have a meaningful debate. The people of Scotland would love to hear what the SNP plans to do. In fact, the people in the SNP would love to hear what the SNP plans to do.
I welcome Mr Smith's comments and the implication that we will have full and frank access to civil servants in preparing our programme for government, which we will shortly have the opportunity to implement.
A question, Mr Stevenson.
I cannot speak for the Executive on that. I am a mere back bencher, as Mr Stevenson knows.
Our spending proposals are important. They are about building a better Scotland, which is about building on the partnership agreement between the Liberal Democrats and the Labour Party—a partnership agreement that was largely shaped by the Liberal Democrat manifesto for the most recent election.
The spending plans will help to deliver on many of those important proposals. They will help to deliver the extra teachers whom our schools so badly need. They will help to deliver a national concessionary fares scheme. They will help to deliver the green thread that runs throughout the partnership agreement and our Executive policies. They will help to deliver free eye and dental checks. They will help to deliver safer routes to schools and 20 mph zones. They will help to deliver, and continue to deliver on, free personal care for the elderly and free higher education.
I regret that Brian Monteith is not in the chamber at present, because I would like to tell him that the Conservative party's proposals for higher education are a disgrace and an insult to anyone of any intelligence. Those proposals would not provide free higher education; that is a complete lie. Students would have to pay higher loans and higher interest charges for decades if the Conservatives ever got into government in the United Kingdom, which, thank God, they will not.
The proposals are also about delivering for businesses on the issues that are important to them, such as the provision of investment in transport. We should not be having false discussions on business rates. The Conservatives keep peddling the myth that business rates in Scotland are higher than those in England, but business rate bills are lower in Scotland because the average rateable value in Scotland is lower.
Will the member give way?
In a second.
Mr Fraser talks about one or two areas where rateable values may be higher, but they are lower in other areas. The important point is that the average in Scotland is lower and therefore the business rate bills that people pay are lower.
Will the member give way?
I must ask whether, if the average rateable values in Scotland became higher than those in England, the Conservatives would still call for a uniform business rate—I do not think so. I will give way to Mr Fraser.
I am grateful to the member for giving way before he became carried away with hysteria. Will he explain why the document that was produced by Scottish Executive economists in October last year demonstrates that Scottish business taxation is 17 per cent higher than business taxation in England? Does he disagree with the findings of Scottish Executive economists?
I am saying that business rates in Scotland are based on the average rateable value. We do not raise more than we would with a uniform business rate—we raise less than is raised in England, because we have held the increase in business rates below inflation for the past two years.
I will highlight one or two extremely important points in the spending proposals. The improvement of dental services through incentives to help to recruit and retain dentists in the NHS is extremely important for many communities where there are problems with accessing dental services. The speeding up of the existing plans for action on infection control in hospitals is also extremely important, as all members know. In the enterprise and lifelong learning budget, there is to be significant additional funding for higher and further education. We should not forget the further education sector, in which capital grants for FE colleges will rise by more than £50 million a year in the next three years. The overall funding for higher education will be 17.4 per cent above inflation and for further education it will be 14.8 per cent above inflation. Those are significant increases, but they have not received the welcome from some Opposition members that they should have.
There will be significant increases in investment in affordable housing. In a members' business debate just before the summer recess, I raised the issue of the serious problem with the supply of affordable housing in many communities. The significant investment in transport infrastructure will allow us to deliver the extensive list of planned rail improvements, such as the Stirling-Alloa-Kincardine railway, the airport links and the important Borders rail link, as well as significant improvements to capacity and services in my area of Fife. For local government, there are guarantees that we will meet the additional costs of any initiatives that the Executive introduces as part of the partnership agreement. One important figure, and something that the Convention of Scottish Local Authorities demanded, is the £60 million for additional investment in road repairs. The spending proposals are good and we should welcome them.
Gordon Brown will be disappointed that Wendy Alexander failed even to mention his speech. That will not go down at all well.
When is an announcement not a new announcement? It is when it has been announced time and again. It is absolutely ridiculous that some of the announcements today go back for what seems like decades. It is unfortunate that the minister has left the chamber. I noticed a familiar tone in the talk of a step-by-step change—there were echoes of the most recent Westminster elections. Perhaps for the coming Westminster elections it would be more appropriate not to talk about step by step, but cut by cut, given that hospitals throughout Scotland are to be closed or downgraded. Many Labour and Lib Dem MPs are raising that issue with the Executive. Of course, the leader of the Lib Dems has gone further than that and has tried to say that his party has had no role in the hospital closure programme in Scotland.
There is no doubt that there have been increases in the health budget. We have heard today that the budget will rise to more than £10 billion a year. That is welcome, but it is what we do with the money that is important. The Executive has failed absolutely to get a grip on the health service and to ensure that it delivers for patients. The public want to know what they have received for that investment and what they will receive for the additional investment, given that they are seeing their services close around them.
In case the minister is in any doubt about the failure to get that cash to the front line, I shall share with members an e-mail that I received from a staff nurse last week. She says:
"Essential equipment such as hoists … are not available due to budgets; gloves, wipes, aprons and incontinence pads are in short supply due to budgets, and most worryingly for the current media interest, mops are regularly not available between the hours of 15:45 and 07:00 hrs. Nurses are regularly required to go down on their hands and knees to clean up excrement and urine. This has severe implications into the spread of MRSA and other so-called hospital acquired infections. Having discussed my concerns with several Infection Control Nurses I am repeatedly told that mops are too expensive and departments are restricted in the amount of disposable mops that are available."
It is all very well for the minister to speak fine words about infection control and plans and targets, but how can hospital staff meet those targets if no mops are available in our hospitals to clean up excrement and urine, as nurses are telling us? The minister needs a reality check. That is the experience of all too many staff on the front line in our health service and the rhetoric from the minister will offer them no reassurance whatever.
I welcome some of the public health measures that the minister announced. I do not disagree that fresh water and healthy eating choices in schools are good things, but turning on the cold water tap is not enough to improve the health of our children and it is not enough to tackle childhood obesity. We need to be far more radical and bold. I commend to the minister the SNP's action plan on tackling childhood obesity—perhaps one of the other ministers will tell him about that when he comes back into the chamber. Our action plan merits consideration. It is comprehensive and will work.
I also welcome the 16-week target from specialist referral to treatment for cardiac intervention. That is a good thing, but what about the time that it takes to see the specialist in the first place? How long are patients required to wait for that? Nothing at all has been said about that issue. In fact, I got the impression that the whole health section of the minister's speech was tacked on at the end, which is not good enough, given the state of our health service and our public health.
I end by asking the minister a specific question, about which I am curious. There seems to be a significant increase of some £20 million in the legal aid budget for 2004-07. How much of that will Gordon Jackson get?
I assume that you have concluded, Ms Robison.
Yes.
So that was a rhetorical question.
I am delighted to be able to speak in the debate, because I think that it marks a new step in investment in Scotland. There is a huge amount of money and it is vital that we get the maximum benefit from all that investment. The taxpayers whom we represent demand that we give best value for the future investment that will come from today's budget, and we need to look not only at the short-term impact of the investment but at its long-term impact. Most members would acknowledge that we are able to make that investment because of the stable economy that we have at UK level and because we have the highest employment rates that we have had for 40 years. We have nearly full employment in parts of Scotland, and part of the budget's aim must be to deliver full employment throughout Scotland.
I want to reflect on that achievement, because it gives us, as politicians, a golden opportunity to shape priorities and investment in our country over a sustained period. The budget is not just for the short term; it is about long-term investment. The challenge is to get the maximum benefit for everybody in Scotland, and we need to ensure that we get best value.
The range of transport projects that is under way is hugely exciting; the minister did not even get to mention all of them this afternoon. We have railway lines that would have been seen as pipe dreams pre-devolution and pre-Labour Government. We have airport links, the Larkhall to Milngavie line, the Stirling-Alloa-Kincardine line and trams in Edinburgh. Those are hugely important investments for Scotland.
Will Sarah Boyack give way?
No. I need to get on to my next point.
I would like to hear more about investment in public transport in the detailed plans that I hope the Minister for Transport will launch. In particular, I am thinking of Waverley station, which is critical to the expansion of railway services in Scotland, such as the Bathgate and Borders lines. If we are to have real expansion in our railways in Scotland, Waverley station needs to be modernised and I hope that the Executive is working on that. Moreover, this week, when the Disability Discrimination Act 1995 kicks in, plans for the installation of lifts at Haymarket station will have been on the table for 20 years, but it has not happened yet. I hope that the Minister for Transport will be able to announce progress on that work when he makes his detailed statements.
It is important that we have detailed projects. Brian Monteith's comment on that was utterly bizarre. We should treat with contempt the idea that our ministers are suggesting infrastructure investment on the basis that it could be cancelled in the future should, horror of horrors, a Tory Government ever be elected. I could not see any member make the connections in that statement, which demonstrated that the Tories cannot believe that we have such an amount of resources to invest and that we can do so wisely for Scotland.
I hope that the ministers will continue the push for public transport and resist calls for a new Forth road bridge, which are utterly premature given the major challenge of improving public transport across the Forth estuary. There are lots of exciting plans and huge opportunities in public transport, and I hope that they will be realised in the future.
We need to focus on best value, because one of the key challenges in transport is that almost any project increases dramatically in cost the minute that the minister announces that he or she will give approval for it. That is the case not only with trains but with roads, and there is a problem with engaging expertise. Ministers need to make progress on learning some of the Fraser report's lessons on procurement for the civil service transport resources.
The prospects for transport are exciting, and the announcements on higher and further education and new school facilities are crucial to high-quality investment and Scotland's economic future. I hope that when the Executive considers local authority investment in particular, it will apply higher standards of efficiency to the projects. I give the example of three secondary schools in my constituency, all of which the council plans to replace. Two of those schools are Victorian; they are excellent schools, but they operate in totally out-of-date buildings that will be replaced by the Executive's investment programme. The third school, which is also due to be replaced, was built in the 1970s. We cannot afford for the investment that we are making to be out of date in 20 or 30 years' time. Our investment must be for the long term and it must be sustainable. It must produce buildings that can be maintained and heated in the long term and which meet our wider sustainable development objectives. There is a section in "Building a Better Scotland" that talks about that, but the Executive needs to send a clear message to the local authorities that not meeting such targets will not be good enough and that excellence in our schools also means high quality and value for the long term.
I hope that the inclusion of the greening government policy in "Building a Better Scotland" will link into the strategic environmental assessment process for the whole of the Scottish public sector, which could lead the way. Explicit consideration of green criteria—transport costs and energy costs—is vital. When we consider the huge amount of money that is being spent, we must take into account the efficiency measures that the Executive is considering in labour costs and the process, but we must also think about the costs of energy and transport. That must be built into the process. Some authorities are beginning to do that with, for example, renewable energy and new school buildings, and the Executive has a programme to make efficiency savings in hospitals. That is hugely important in ensuring that the money is used as effectively as it can be.
The political choice, which is clear, is between continued progress on our services and infrastructure and long-term certainty on the one hand and, on the other, the cloud-cuckoo-land or doom and gloom of the Opposition parties, which will not engage with what the investment will mean for Scotland and have not set out their alternatives. The spending review is a clear set of proposals and I look forward to the future announcements from ministers. Today is a good day for Scotland, because it is about record investment. We need to ensure that the proposals become reality and make the big difference that they can make.
I am, once again, grateful for the opportunity to comment on Scotland's advance spending plans. However, as there is a spending review this year, the financial information that was offered for parliamentary scrutiny during stage 1 of the budget process is already out of date. Can we have an assurance that, during future spending reviews, parliamentary committees will not have to go through the motions of commenting on figures that will be superseded before the draft budget is published?
That is not the only reason why full parliamentary scrutiny continues to be something of an illusion. In the Executive's seemingly admirable drive to make the budget process more open and accountable, targets are rationalised, goalposts are moved and the end result is less transparency, not more. The Environment and Rural Development Committee's submission on this year's annual expenditure review said:
"The Committee continues to experience extreme difficulty in conducting meaningful budget scrutiny. Continual changes in the format and presentation of documents - whilst designed to improve the process - have had the effect of making real comparisons between years almost impossible."
In a recent report on Scotland's ability to adopt sustainable development, a member of the First Minister's Cabinet sub-committee on sustainable Scotland stated that a particular obstacle to sustainable development
"had been in relation to the spending review and finance".
Nearly three years on from the First Minister's so-called big commitment to greening the spending review, the minister's statement paid the merest lip service to sustainability. Apparently, it runs through every decision, although there is scant evidence of that. Every positive commitment that was mentioned by the minister or Sarah Boyack is matched by a contradictory policy elsewhere. The big thing that was talked about in the ministerial statement was transport. However, the use of private finance initiatives to fund major projects allows the Executive to hide the reality of its spending. A £30 million-a-year payment for the M74 in Glasgow might not feature prominently in an annual budget, but if those payments are spread over 30 years, it is clear that many other local, sustainable transport schemes must lose out. The Executive is still pouring money into road building. Add that into the percentages and the real figure becomes clear. We are mortgaging any chance of having a sustainable transport policy for the future.
Does Mark Ballard agree that it is profoundly undemocratic, as well as uneconomic, for any Administration to tie the hands of future Administrations that have yet to be elected and force them to fund PFI or public-private partnership deals?
I agree strongly with that. The PFI schemes are mortgaging Scotland's transport future and setting us on a path of unsustainable development.
Will the member take an intervention?
I am sorry; I have just taken one.
Why must there be a focus on transport projects that take us in the wrong direction at the expense of the plans that would meet people's actual transport needs? Rather than wasting money on the M74, why are we not talking about Glasgow crossrail? Instead of spending countless millions on grandiose airport rail links and tunnels under Edinburgh airport, why not do what Sarah Boyack suggested we do and prioritise the upgrade of Waverley station? We are stuck on the same old agenda of motorways and runways rather than railways. I thought that we had got away from that old Tory transport vision.
This spending review doubles the route development fund, which will inevitably lead to more climate-busting air travel.
As I said, the minister's statement contained some good elements. The strategic waste fund is a move in the right direction. However, we need to place far more emphasis on ensuring that waste is not generated in the first place rather than paying local authorities millions of pounds to clear up after business. Similarly, we welcome the announcement of £8 million for the green jobs strategy, but that has to be put in the context of an enterprise policy that is still fundamentally about economic growth in terms of driving up Scotland's gross domestic product—a discredited figure that does nothing to take regard of people's social and environmental needs.
Ultimately, we cannot build a better Scotland simply by throwing money at it. As Sarah Boyack said, we need to ensure that all our spending genuinely benefits our country and boosts our natural well-being. I just wish that her rhetoric had been matched with criticism of where the Executive is going wrong, because I think that she knows where that is.
We must place a firm emphasis on society and the environment as the measures of well-being rather than using GDP growth, which, unfortunately, remained at the core of the statement that we heard today. A budget that put those measures first would be a real budget to build a sustainable Scotland.
The spending review not only means continuing improvement in Scotland's public services, but shows that the Executive will deliver on its promises. When the First Minister set out Scottish Labour's stall as Scotland's party of enterprise, that was a bold challenge to our party. When the coalition partners said that enterprise was the Executive's top priority, people said, "Great, but how are you going to show that it is?" Opposition politicians and commentators can demand every kind of initiative and investment, but they know that they do not have to make hard choices from a range of causes that are worthy of funding so that investment is targeted to make the most difference. The Executive has not only talked about enterprise, but taken action to encourage enterprise in Scotland, with concrete proposals and targeted investment.
I was one of those who said that if Labour was to prove itself as a party of enterprise, we had to invest in our universities and colleges. Like others, I argued that that investment was vital to enable our universities and colleges to take on the challenge of top-up fee income down south so that they could be drivers in creating the knowledge economy that Scotland needs. Today, the minister responded positively to that challenge. Of course, we must engage in longer-term thinking about how we will sustain high levels of investment in tertiary education in the years ahead, but the settlement is just the boost that the sector needs. This is the first time that there has been £1 billion in support for the sector. That support means that the sector can retain the top academics who put Scotland at the forefront of new and developing industries such as biotechnology and renewable energy.
Labour's proudest boast in government is that we have lifted hundreds of thousands of Scots out of the misery of unemployment and given them jobs and the opportunity for better and more fulfilled lives. The spending review is another step forward in our drive for full employment.
It is not just investment in the knowledge economy that makes this a spending review for enterprise. Once again, we are investing in infrastructure and a key element of that is transport. In the previous spending review, transport spending rose to more than £1 billion for next year. That increase was welcomed by business organisations because they know how business benefits from spending on transport infrastructure. I know that the extra investment that the minister outlined today—we will spend £1.4 billion by 2007—will be welcomed in the north-east. I hope that it will allow speedy progress with the construction of the western peripheral route, which is vital to the region's development, but I also hope that we will see progress on other projects such as the proposed Aberdeen crossrail project.
The extra investment in health services that was outlined today is important for every area of Scottish life, including the economy and economic prosperity. If Scotland is to be a more successful nation, it must be a healthier nation. The Executive has forged a groundbreaking health agenda in the action that it is taking not only to treat illness but to promote healthy living, and I believe that we will reap the benefits of that in the coming years. The Executive is also ensuring that we have record investment in hospitals and in nurses and doctors.
We are all aware of the concerns in some communities about the reorganisation of health services, but it must be clear to people that the Executive is spending more than ever on NHS services, and certainly more than was spent in the Tory years. The Tories' opportunism in the health debate in Scotland is breathtaking. If the Tories were in government, there would be no debate on where patients should access NHS services because they would not be able to access such services at all. We should be clear that the Tories' agenda is to break up the NHS and force everyone to rely on private health care schemes, which would be disastrous for the most vulnerable people in society. Those are the real terms of the health debate in Scotland.
Thanks to Gordon Brown's excellent stewardship of the UK economy, the Executive is able to announce today continued, record investment in public services. That shows the huge benefit to this nation of being part of the UK economy.
Does the member think that an acceptable price for that largess is that we continue to grow at a dramatically lower rate than the rest of the UK? We pay the price by seeing our talent migrate to that economy.
Jim Mather should read the recent report from Lloyds TSB, which shows that Scotland's economy continues to grow at its fastest rate for almost seven years. It is a rather inopportune time for him to make his point. In comparison with the euro zone, our economy is growing at a favourable rate.
Unlike Mr Mather, the Executive has not been obsessed with debates about fiscal autonomy, which are geared to the hopes of separatists rather than to the needs of the economy. Instead, it has taken action to create growth in our economy and to put in place the building blocks for economic success.
Of course challenges lie ahead, but the spending review means that we are better placed than ever to meet them. The spending review shows that the Executive is playing its part in creating a thriving and enterprising nation. When the question is asked about who the big winners are in the spending review, the answer is clear: they are the people and the future of Scotland.
I start my campaign to make friends and influence people by praising part of Mark Ballard's speech—I see him worrying about which part I agree with. In his opening remarks, he made the relevant comment that some of the criteria that the Executive uses to present its expenditure plans change so quickly from year to year that it is difficult for parliamentary committees to assess what the changes are. I look forward to studying the proposals in greater detail this year, to find out whether the figures are, for the first time, presented a little more consistently, so that we can understand them better.
I am a member of the Finance Committee, which asks the Executive to change its processes as part of a dialogue between the Parliament and the Executive. Is it not slightly unfair to blame the Executive for reacting positively to the Parliament's requests?
Was that an invitation to blame the Finance Committee? I will not do that. I am saying that it is important to be able to compare like with like, which is not always possible if the criteria change.
I will examine some of the impacts of general expenditure on the rural economy and raise concerns about likely impacts. I was glad to hear the minister's commitment to economic growth as an important principle and I will continue to support that, but I am concerned that some elements that are creeping into the way in which money is spent in the Scottish Executive may undermine growth in the rural economy.
I will give a couple of prime examples, the first of which has been dealt with to an extent in the passage of the Water Services etc (Scotland) Bill, when the opportunity has been taken several times to raise concerns about the water services system in areas of rural and peripheral Scotland, especially in relation to the distribution of housing. The system's failure to deliver enough resources to expand sewerage services, for example, has created a de facto planning system in some areas. As a result, it is difficult to find not only affordable housing for many people in rural Scotland, but opportunities to provide any housing at all.
Another problem that continues to grow disproportionately in rural Scotland concerns the provision of health services. In this debate and others, it has been said that hospital closures are making it increasingly necessary for people to travel considerable distances to access the health services that they are entitled to expect.
Another impact of health services on rural Scotland arises from the imposition of change in out-of-hours services for general practitioners across large areas. Many who live in the most peripheral areas are seriously concerned about that change, which has been driven not directly by budgets, but by changes that cost money and are consequently budget associated. The change is beginning to cause grave concern among people who wonder where their doctor will be and how far they might have to travel to see him in an emergency.
I am grateful that the minister announced his intention to establish a concessionary travel scheme that covers the whole of Scotland, not only for older people, but for young people. Many people who have suffered from the anomalies that the current patchwork has delivered will receive that gratefully. However, in huge parts of rural Scotland, the practical way of going from A to B remains the private car. That can be demonstrated in the many areas in which, if one sees a bus, the chances are that only one or two people are on it. As a consequence, we must highlight the continued failure to maintain some rural roads and highlight the impact that fuel prices continue to have over large areas of Scotland in which fuel prices may be the same, but greater distances are involved and transport costs are disproportionately higher. If a high proportion of the money that we spend on fuel is taxed and a person travels more miles, they will pay more tax. That is not how the tax system should operate.
Another pressure that continues to grow is that on rural local authorities. I am tempted not to be too sympathetic towards people who make decisions that are designed to be provocative. However, it is ironic that, where school budgets and school transport budgets continue to be a burden on local authorities, that results in some of our best rural schools being threatened. Today, I heard that Dun School in Angus is the next small rural school to be threatened in that area. It is essential that the Parliament continues to represent the needs of people in rural areas who have often been educated in small schools, but are put under pressure by local authorities that are themselves put under financial pressure in respect of how they provide education.
I will finish by touching on two specific issues—the beef national envelope, which is proposed under the common agricultural policy review, and the land management contracts, which are under consultation. Those are significantly redistributive elements in respect of how they handle funds that are allocated to Scotland's farmers. My continuing concern is that, unless we can find ways in which to deliver systems that take modulated money and essentially offer the opportunity for that money to go back into the hands of the farmers from whom it was originally modulated, we will have a rebellion among those farmers on our hands. I urge the minister to encourage the Minister for Environment and Rural Development to reconsider those schemes so that we can get a fairer distribution.
I was particularly interested in the minister's reference to the place of physical education in schools and I welcome the Executive's conversion to having more PE teachers. Therefore, I draw the Executive's attention to a scheme that was launched only six weeks ago in Clackmannan and which is the only such scheme that is running in Scotland. As far as I can work out and have learned from teachers and officials from the county, the scheme is proving successful. It is a template for getting more PE teachers into schools when we need them.
Can the minister find enough money in the spending at his disposal to mount an evaluation exercise, which would kill around three birds with one stone? We can work out what quality PE is; prove that there must be trained specialists in primary schools; and work out how to recruit teachers on a shorter training scheme than the current one. An evaluation exercise should be mounted, and I have been assured that the University of Edinburgh could undertake such a scheme. Of course, I am not being partisan.
I thank the Presiding Officer for giving me the opportunity to put my proposal to the minister.
It gives me great pleasure to contribute to the debate and to close for the Labour Party.
I welcome the massive investment for our communities throughout Scotland, the like of which we have never seen before. As the minister stated, a £900 million increase in capital investment will allow us to make the investment that is needed to tackle the damage that was created by years of underinvestment by the Tory Government. The investment will allow us to link the regeneration of our communities to economic opportunities. We heard that our budget will increase to £30 billion—previously, we could only have dreamed of such money.
The key goals that have shaped the Scottish budget for the next three years are growing our economy and investing in all Scotland's people; providing opportunities for all our young people and improving our public services; and safeguarding our environment and realising our ambitions for Scotland and all its people. The budget allows us to build on what we have achieved so far and is an investment for a sustainable future. That investment has been made possible by the UK Government's sound economic management under the most successful Chancellor of the Exchequer that this country has ever seen. Our economy has experienced the lowest inflation for 30 years, the lowest interest rates for 40 years and falling unemployment. For the first time in more than a generation, the prospect of full employment is within our grasp. The challenge for us is to spread that success throughout all our communities.
This is a budget for enterprise, opportunity and fairness: enterprise in our schools, universities, businesses and public services; opportunity for our young people and our families; fairness for our elderly and for all Scotland's communities. I congratulate the minister on making fairness the key plank in his budget statement today. That fairness can be seen in the increase in transport investment, including new investment to create a single, national, Scottish scheme for pensioners, disabled people and, uniquely, young people. The scheme was pioneered, I am proud to say, by Fife Council, so we can see that fairness and opportunity can work at all levels of government.
I welcome the 11 per cent increase for education. The subsidy for healthy choices in school meals and the commitment to one teacher for every 18 Scots between the ages of three and 18 are investments in the health and education of our young people. We have seen commitment become a reality through the introduction of McCrone, and I take the opportunity to thank all our teaching staff for their dedication and commitment to our young people.
The increases in health spending, the new targets on waiting times and the action to improve diagnostic services are all welcome. All our constituencies have instances where improvement is needed, so we are glad to have heard the minister's announcement of real and sustainable investment in the health of our communities and people.
Unlike Conservative colleagues, I welcome the commitment to Scotland's further and higher education sectors. As one who comes from that sector, I am pleased to see that its pivotal role in the growth of our economy has been recognised with a fourfold increase in capital investment. That investment will ensure that we have the necessary skills to compete in an increasingly global economy.
I also welcome the investment in new homes and in the regeneration of our communities. I welcome the investment in our police services, the need for which I highlighted in our recent justice debate. That commitment will help to tackle antisocial behaviour and reduce reoffending. That is a commitment to safer communities.
I take a moment to explore the Tory strategy of cuts that Mr Monteith alluded to. The Tories would cut public services by removing access. Their policies would cut taxes for those who are well off and cut services for those who need them. They would make health and education available to those who can pay by removing access to services from those who need the opportunity and the care. The Tories would restrict choice, increase privilege and damage our economic growth.
Notwithstanding the fact that the member provides no evidence for any of those assertions, will she explain how a cut in the council tax rate would be a cut for the well-off rather than for those who find the council tax difficult to afford?
I got my evidence from Mr Monteith's speech. There is no doubt that his policies would result in a dramatic reduction in the public services that we have fought for and which we have reinstated since the abolition of his very unpopular Government.
The Labour-led coalition is delivering a culture of enterprise and ambition. [Interruption.] I am sorry if the Tories find that funny. We are striving for full employment and we are putting money into the areas that matter most to my constituents: jobs, transport, health, education and crime. Devolution is delivering—delivering on the people's priorities.
The biblical promised land was one flowing with milk and honey. On the basis of today's spending review, Scotland is set to become a land flowing with silk and money, especially if someone is a builder or construction engineer or if they are in the plant-hire business. It was said of the Bourbons that they forgot nothing, but learned nothing. Labour has clearly forgotten nothing when it comes to spending other people's money. We can only hope that Jack McConnell has learned some of the lessons of the Holyrood debacle in allocating what he has described as Scotland's
"most significant long-term investment for generations"
to bricks and mortar. However, after listening to Andy Kerr's spending priorities today, I do not believe that the portents are favourable.
Prudence has always been Gordon Brown's mistress of choice. Andy Kerr's exemplars, on the other hand, seem to have more in common with drunken sailors. Under the plans announced today, capital investment is to soar by 10 per cent above inflation. Few, apart from Mark Ballard, would argue that Scotland's road and rail services do not need improvement. Air services and routes also require development. We need to include in the bricks-and-mortar benefits of devolution better schools, hospitals, housing and—before young Jeremy Purvis does his Jack-in-the-box impersonation—affordable housing, too.
Will the member give way?
I will not.
In the public services, the Executive continues to misdirect resources. I thought that Jack McConnell was the only person left in Scotland who believed that simply throwing more money at the health service makes it better. Today, Andy Kerr promised £10 billion a year on health, and Richard Baker and a queue of other cheerleaders praised him for that. However, the one question that Jack and Andy cannot answer is, are we getting value for money? No one knows. As Des McNulty almost admitted, and Murdo Fraser pointed out, that is the great black hole at the heart of the minister's statement today.
There have been so many changes in departments and accounting procedures and so many targets missed and new ones set that it is impossible to tell which Executive budgets are doing relatively well and which are doing relatively badly. In his speech in Brighton, Jack McConnell claimed that Scotland is the place most likely to find a cure for cancer, but no one knows whether spending on cancer treatment in Scotland is effective. The Executive has set a target of reducing deaths from cancer by 20 per cent between 1995 and 2010. That is a key priority, but as Professor Arthur Midwinter points out, the Executive finds it impossible to isolate the specific impact of Government spending on cancer death rates. If a cure for cancer is ever found in Scotland, how will the Executive be able to tell which factors contributed, or whether its spending played any part at all?
The same is true of educational attainment, crime rates and unemployment rates: we cannot relate the spending to the outcomes. Despite the huge surges in spending on health of which Wendy Alexander and others are so proud, waiting lists and times are up. Moreover, overall educational attainment is not improving and crimes and offences are up.
Brian Monteith might be right in saying that capital projects can be cut if the money runs out, but it is also possible that many of the big capital projects outlined by Andy Kerr will simply be repackaged or respun, as we have seen in the past, by the time that Scotland next goes to the polls.
When it comes to spending on public services, especially with few reforms envisaged, Scotland's taxpayers should be able to judge exactly what they are getting for their money, on an annual basis and without the accompanying spin. At Westminster, ministers must sign up to achieving their targets. If they fail, resignations are at least possible. However, Executive ministers can blithely make promises—as Andy Kerr did today—fail to meet them and move on to a new set of targets, with little or no prospect of being replaced. That is all the more true if we believe this morning's press, which suggests that poor Jack McConnell does not have enough talent to reshuffle the Cabinet, much as he might like to.
Brian Monteith and Murdo Fraser have already spelled out alternative Conservative policies on education.
Will the member take a nice intervention?
No.
On health, we would ensure that spending was targeted on the places where it is most needed and that professionals became accountable to patients for the hospitals on which taxpayers' money is spent. On business rates, we would fulfil Jack McConnell's pledge to make Scotland the best place in Britain in which to do business. We would do that by making business rates lower in Scotland than in the rest of Britain, instead of higher.
I listened carefully for any mention of the beleaguered fishing industry in Mr Kerr's spending review statement, but there was none, just as there was none in Jack McConnell's speech on the day when the Parliament building opened. Our opponents pay lip service to entrepreneurialism, but can they give us a better example of entrepreneurialism in Scotland than our beleaguered fishing industry?
We have no problem with spending to solve Scotland's deep-seated problems, and on the basis of what has been announced so far, Oliver Letwin would allocate more to Scotland over the next five years than Gordon Brown would. However, we would ensure that spending coincided with reform—that is the difference between us on the Conservative side of the chamber and those on the Executive side. We hear an awful lot about fiscal autonomy and Wendy Alexander's new phrase, fiscal federalism, but it is time that we heard a lot more from the Executive about fiscal responsibility. We on this side of the chamber are still waiting to hear about that.
As we all know, the spending review is a spending-only exercise. The Government remains without a credible means of growing sustainably Scotland's revenue or improving materially Scottish competitiveness. Without those abilities, the Executive has no means of creating a genuine, provable and sustainable blend of efficiency savings and the climate that will force genuine growth.
Although other countries invest to maximise their revenues and to improve living standards, this Government merely spends. Here in Scotland, financial data are announced in a series of statements augmented by press leaks; they are not presented as a proper, evolving financial position with an open audit trail that fully achieves a clear understanding of movement and allocations and which confirms spending commitments.
Here in Scotland, the lack of top-level targets remains a deep affront. Either the Government believes that its budget decisions will improve the lot of the people of Scotland in terms of growth, population numbers and life expectancy, or it does not. If it does believe it, it should have targets; but we have no targets. The absence of those targets forces the conclusion that the Scottish Executive does not believe in its ability or the ability of its budget to make a difference to those important measurements.
It is also clear that announcements and pre-announcements make little difference to galvanising and motivating the people of Scotland. Unlike real budgets in normal countries that change stock markets, influence savings and exchange rates and create queues at petrol stations, apart from the fact that a few investment decisions will have been made, our budget will change little in the dynamics and potential of the Scottish economy; yet we are only too well aware that even using cautious oil-price projections that are well below actual prices, Scotland could see oil revenues rise by more in a single year than the entire spending increase that the Executive will receive over the next four years.
Economic growth is rightly the Executive's top priority, but neither the financial commitment to economic development, whose share of the total budget is declining, nor our mediocre results over the past 40 years make that credible. More important, the position does not compare with the outcome that could be achieved by the two major effects of independence—specifically, regaining control of our oil revenues and reasserting our right to compete.
I say to Wendy Alexander that we could manage any oil-price volatility by creating an oil fund for future generations and by matching our Norwegian neighbours. That would be better than winning the lottery, passing the proceeds to our neighbour and hoping that it is both successful and fair with us.
Will the member take an intervention?
I will give her intervention the same response that she gave me.
With our own oil and the right to compete, Scotland would be living through a boom time. Instead, we receive a tightening flow of demeaning pocket money from the Chancellor of the Exchequer, who is busy picking Scotland's pockets and denying us the right to compete.
It is not only the SNP that believes that the current system is flawed; the latest Fraser of Allander paper on fiscal federalism by Hallwood and MacDonald says:
"The key economic argument in favour of fiscal federalism"
is
"that it improves efficiency in the use of resources"
and
"economic growth".
That supports our criticism and our call for the need for more power.
I say to Wendy Alexander that fiscal federalism is fiscal autonomy. The people of Navarra and the Basque country in Spain believe so, but their version comes without the complexity, the delay, the wrangles, the royal commission and the five-year review that she advocates. Can she understand why we see independence as a vastly superior and preferable option?
I am grateful to Mr Mather for raising Catalonia, which follows my model of fiscal federalism—or rather my model follows that of Catalonia. Perhaps the member will tell the Parliament why Catalonia does not seek to secede from Spain.
It is pretty clear that Catalonia is in the pipeline, waiting to match what Navarra and the Basque Country are doing. I am glad that the member raised that point because those are the two most successful regions in Spain.
Will the member take an intervention?
The member has accepted none of my interventions in two debates, but I will defer to her.
I am sure that the people of Catalonia will be interested to discover that Navarra and the Basque Country are regarded as more economically successful than it is.
In citing Navarra and the Basque Country, the member has very helpfully clarified something for me. Will he confirm that the economic agreement between the Spanish Government and those two areas requires them to agree all levels of taxation with central Government? If that is his definition of fiscal autonomy, it differs from everything that we have ever heard him say before.
The right to compete is paramount. I do not believe for a moment that Navarra, the Basque Country, Catalonia and so on are tying their hands behind their backs and allowing themselves to be boxed into a position that stops them from maximising results for their own people, as is the pattern across the planet, except in this chamber and this country.
MacDonald and Hallwood also point out in their paper that
"the current devolution settlement does not give … politicians an incentive to improve economic growth."
That is exactly the view of real people who hear the rhetoric about the top priority but see the reality of population decline, low productivity, a widening average wage gap and the departure of talent from Scotland. MacDonald and Hallwood also say that the current devolved settlement does not encourage the search for innovations that would reduce costs and improve services. Again, that view is widely held across Scotland and exposes the Executive's lack of targets and lack of enthusiasm openly to make comparisons and to learn from the pattern of its spending and, most important, from the pattern of outcomes that are a result of that spending. Indeed, the Executive also seems reluctant to benchmark our services and costs in comparison with elsewhere.
That view is supported by an earlier Allander series paper by Nicholas Crafts—
On a point of order, Presiding Officer. Although I have listened with interest to Mr Mather's comments, I have not heard the word "budget" mentioned for the past three minutes. I rather feel that it would be interesting if he could get back to the subject. I hope that you agree.
That exhortation was useful. However, if I were to apply the rule of relevancy absolutely in closing speeches, we would frequently be out of here by about 4 o'clock.
I wonder how often Mr Monteith has met that criterion himself.
My key point is that without a strategy to spend in line with and without a proper mechanism to achieve that strategy, we do not have a budget. Instead, all we have is a spending list, which does Scotland a massive disservice. Over the years, I have watched how the allocations and priorities have changed, how the money has moved and so on. However, do the outcomes change? No. Does Scotland move forward? No. Does Scotland have a growing population? It most certainly does not. No one in this chamber should talk to me about the success of the UK economy, when it is causing this country's economic bucket to haemorrhage while we are sent back a housekeeping allowance. This is not a budget; the situation is not acceptable; and this country must move on.
I call Tavish Scott to respond to the debate. You have 11 minutes.
Thank you, Presiding Officer. I will endeavour to be relevant, as you have asked.
The budget sets out our ambitions to build a better Scotland; it is a budget for enterprise, opportunity and fairness. Today marks the start of the budget process, which runs all the way through to January when we introduce the budget bill. As a result, I say to Mr Morgan and other members that there will be plenty of opportunity to debate the details of the budget in the chamber and in committees. Indeed, there will at least 13 full chamber debates on the plans before they come into effect. Some might find that discouraging, but not I. Devolution has brought a fundamental change to the nature of budget setting; Parliament, the committees and the public all have central roles to play.
As Mr McNulty pointed out, the Finance Committee recommended in its stage 1 report and in successive exercises that we make capital spending a priority for the budget, so we have done so. Not only have we introduced a new net investment rule to safeguard levels of investment in the longer term, but we have increased net investment by 40 per cent over the life of this budget alone.
The Finance Committee wanted housing and regeneration expenditure to be priorities. In this budget, we have announced plans to invest more than £1 billion to provide more affordable housing and to invest a further £318 million in the next three years in regeneration of our communities.
The Finance Committee asked us to look again at our targets and sent us a list of those that it thought should be dropped or improved—Mr Brocklebank is a member of that committee. We have looked at those targets and in the document, which I hope Mr Brocklebank has had the chance to consider, not only have we replaced more than 90 per cent of the targets—the very ones that he, the Finance Committee and other committees felt were inappropriate—but we have met our commitment to the Finance Committee to bring the number of key targets to below 100.
I say to members who have this afternoon accused us of clarifying or changing figures, that we have done that because the Finance Committee—and other committees of the Parliament—asked us to respond to their concerns.
We have also responded to other parties. The Convention of Scottish Local Authorities made a strong case for £60 million for local roads repairs; we have allocated £60 million. I hope that Mr Johnstone accepts that and I hope that COSLA will agree to work with us to make sure that people throughout Scotland will see the outcome of that £60 million of spending on their local roads.
Of course, the budget runs the gamut of the Executive's spending and it is only possible to cover part of that spending today. I confirm, as Mr Kerr did, that the budget plans will implement the partnership agreement in full and that ministerial colleagues will announce more details over the coming weeks. Those announcements will relate, for example, to the questions that Sarah Boyack asked about transport. I can give Margo MacDonald the assurance that she sought in relation to the matter that she raised during the debate. We will evaluate the project that she mentioned, but that evaluation will be done when the project is operational and when it would be appropriate so to do.
I will respond to some of the points that were made in the debate. First, on the SNP's latest policy on oil—even Mr Morgan would have to accept that we have had this debate many times—I remind the SNP that oil prices go down as well as up. We all remember how the oil price was used by Chantrey Vellacott to give a flavour of the economic situation of Scotland. Every year the oil price changed, every year the country's economic prospects went up or down as a result and every year the SNP's response changed. The SNP said that it was "Game, set and match" to the independence case one year, but when the oil price dropped the SNP said that it was
"back of the envelope economic gibberish".
Nicola Sturgeon apparently declared last night, "It's our oil," but apparently only at the right price.
Jeremy Purvis, Wendy Alexander and many others were right to highlight the Executive's commitment to growing the Scottish economy. We have set out at the start of our introduction to the document a table—another Finance Committee request—which explains how so many parts of the Executive will work to grow the economy through a robust 30 per cent funding boost for further and higher education; record investment in transport infrastructure; new, affordable homes; support for the timber industry in rural areas; support for tourism and support for new, environmental industries. All those budgets will grow rapidly under our plans and all will help the economy to grow.
Another source of energy is, of course, renewables. Renewables represent a massive green and economic opportunity for Scotland, which is very important to the minister's constituency of Shetland. Why is there no commitment on renewables in the minister's statement, given that investment in renewables is required?
Mr Lochhead will be very pleased to learn that I will come to that very point.
Before I do so I will finish my point about the economy by responding to Mr Monteith and Mr Mather—those harbingers of doom and gloom on the nature of the economy. I will quote three sets of statistics, which are from independent sources; they are not Government statistics. The Royal Bank of Scotland "PMI Scotland Report" for August 2004 showed that the growth of private sector output in Scotland was maintained for a 14th successive month. The Scottish Chambers of Commerce business survey was headlined, "Chambers' survey points to continued growth for Scottish economy", and the latest HBOS Scottish index of leading economic indicators was headlined "Business investment to fuel Scottish economic growth in 2005". It predicted that growth would improve steadily this year and that business investment would replace personal consumption as a key driver of growth in 2005.
I am surprised that the Conservatives have come along to the debate. Mr Monteith looked sheepish earlier when he delivered their agenda of cuts. After all, David McLetchie told the Sunday Express during the summer that he was going to use £540 million of the Executive allocation to cut council tax by nationalising education funding. That would mean £540 million less for the Scottish Executive to tackle the issues that we have identified. It would mean £540 million less for higher education. The Tories can never match us, however much they try to fleece students with commercial rates for their Tory loans. It would mean £540 million less for transport links to Scotland's airports to boost international business. It would mean £540 million less for affordable housing and more misery for people who might be glad of the chance to have a council tax bill of their own in the first place.
I certainly do not think that I was being particularly sheepish when I advocated a 35 per cent cut in council tax.
The minister talked about Scottish economic growth. Our argument is twofold: first, comparative to the rest of the UK our performance is not as good as it should be and, secondly, we are living beyond our means, not just in Scotland but in the UK. Because the money is a hand-me-down from the Treasury, there is nothing that the minister can do when that money is cut.
Mr Monteith could not square the circle between cutting, cutting and more cutting and the investments that we will make in Scotland's economy and measures that will promote Scotland's economic growth.
The Greens should look again at our record. We have transformed recycling for households: the figure was 6 per cent, but we will achieve 25 per cent by 2006 and 30 per cent by 2008. That achievement has not come about by the Executive sitting back. The Executive has given environmental leadership that has been supported by hundreds of millions of pounds. More important, it relies on the efforts of literally millions of people who are prepared to help in their homes. People in Scotland have risen to that challenge; it is time for the Greens to recognise and support that.
On the environment, we will not only make dramatic progress on recycling, but we will spend 70 per cent of the transport budget on public transport. Mr Ballard should note that that never happened under the Tories. We will progress our partnership agreement commitment to a new £20 million fund for saving energy in the public sector and we will drive forward our green jobs strategy—Mr Lochhead should take note—in meeting our ambitious target for renewable energy.
Finally I turn to the Scottish National Party. I warned the SNP during the finance debate that it secured last December that it would simply have to get a grip and get its spenders and taxers to sit down together and come up with a coherent plan—the two groups are miles apart. The chief spender seems to be London's Mr Salmond, who wants bullets everywhere on top of all his colleagues' promises. However, the taxers of the party have now decided to cut off the cash that is available for Government to spend. After the SNP conference, the taxers want lower corporation tax, lower business rates, lower water rates and lower national insurance, as well as their existing proposals to decrease fuel duty, whisky duty and income tax on low earners. The SNP has created a credibility gap, with more and more spending pledges, but less and less money to pay for that spending.
I found the supreme irony in some old press clippings from days gone by when Alex Salmond was the Scotland-based leader of the SNP and Jim Mather was being hailed as the next member of the Scottish Parliament for Ayr. Alex Salmond had a go at the Tories during the Ayr by-election campaign and said that the Tories could not have it both ways; they simply could not have tax cuts and keep public services going. It is no wonder that one of Mr Salmond's recent claims is that
"All that is needed is the imagination".
The Executive is promoting enterprise in Scotland's schools and universities, businesses and public services. We are promoting opportunities for young people and families and fairness for the elderly, for communities and for all Scotland's people. Our spending plans take the next steps towards building a better Scotland, and I commend them to the Parliament.