Chamber and committees

I always want to keep myself in proper order in Parliament. I think that I might be straying from that if I were to move into that territory.

I was actually going to say something kind about Mr Rennie later on—

Why? Tell me why.

I am being encouraged to strike it from the record, but I will be more generous. However, I say to Mr Rennie, just to set his expectations in the right place, that this is not my last speech. I will make another one at the end of the debate, so he should be careful what he intervenes on me about before we get to that point.

The budget that was set out by the Chancellor of the Exchequer last week—I recognise the scale of the challenge that the chancellor faces—has, of necessity, had to act to repair the damage that was done by the UK mini-budget that crashed pension markets and led to higher borrowing costs. Decisions have consequences; we are having to live with them and they will have an impact on the wellbeing of people in Scotland.

As we continue to deal with the aftermath of that, today’s debate is focused on how we can achieve a more balanced and sustainable approach to the economy—one that prioritises wellbeing across social, economic and environmental dimensions and recognises interlinkages and the need to address those issues together. That is, essentially, the point that Mr Johnson has invited me to comment on. Yes—growth is important in the economy, but the implications and the impact of that growth, and how we use resources in achieving that growth, are equally significant considerations.

Yes. A good thing about the investment that this Government makes in education is that we now have record levels of young people leaving our education system for positive destinations and having positive outcomes. We also have the largest-ever proportion in our history of young people from deprived backgrounds entering higher and further education. Those are just two examples of the successes that are being delivered in Scotland today.

However, there are cautionary notes, as we can see in the “Fiscal Sustainability Report”, which the Scottish Fiscal Commission published this morning. It provides a 50-year outlook of Scotland’s fiscal position. It contains stark projections that Scotland’s population will age and decline over the longer term, with our working-age population also being forecast to fall, while a slight increase is forecast for the UK as a whole. It is projected that those changes, alongside other factors, will increase pressures on spending, especially spending on health.

I will make a point about the importance of ensuring that we are able to support and sustain population growth. If that report had been written 20 years ago, it would have said much the same thing. However, in the past 20 years, we have been saved from the impact of projected changes of that type by the effects of EU migration into Scotland and the population growth that has come with it. I fear that we are now—I suspect that the report begins to reinforce this point—beginning to see the significant impact of the loss of free movement of people whereby EU citizens are able to choose the jurisdictions in which they live and operate. As a consequence of that, Scotland will suffer more acute pressures.

Obviously, a range of factors will affect that. People are certainly welcome to come here. If we look at the labour market data, we have near record lows in unemployment and economic inactivity, and very high—almost record—levels of employment in Scotland. We have a very tired and constrained labour market, so the invitation for people to come to Scotland is clear. It is important to ensure that they can, as a consequence of doing so, benefit from and experience our strong public service offering, which can have a significant impact on their quality of life.

The objectives of the Government in advancing the wellbeing economy strategy, which are demonstrated by the contents of the national strategy on economic transformation, are all about ensuring that we take a balanced approach to economic opportunity in Scotland. We have to strike the correct balance between pursuing investment in our society, attracting international investment, utilising resources and ensuring that we are supporting enhancement of the wellbeing of individuals in our society. Those interrelated questions lie at the heart of the economic strategy that the Government is taking forward.

Why is that necessary? It is necessary because of the challenges that face our society. Whether we are looking at climate change, energy sustainability or wider economic opportunity, all those factors are relevant in judging the approach that we need to take in order to ensure that we create the strongest possible economic foundations for our society. We need to develop an economic model that addresses all those matters.

The underlying causes of the interrelated crises that I have talked about in this speech underline the need to strengthen and transform our economy into one that is socially just, delivers a better and more prosperous future for everyone in Scotland, empowers communities, protects and regenerates our natural environment and builds long-term resilience to the future shocks that will inevitably come our way. The Organisation for Economic Co-operation and Development has indicated that the type of economic model that enables us to take a balanced approach—which, of course, is anathema to what we heard on the mini-budget in September—is exactly the right approach.

In 2017, the Scottish Government held a significant conference on inclusive economic growth. From that international event, the idea of forming a coalition with other progressive Governments to develop and advance a new economic approach emerged. That led to the establishment of the international wellbeing economy Governments network, along with New Zealand and Iceland. The group meets regularly to share ideas and good practice and now includes Finland and Wales. Other countries are also engaging ever more closely with the network; for example—

I am grateful to Liz Smith for giving way—I will come back to her earlier remarks later. Does she understand that she is on rather thin ice in giving the SNP Government advice on economic policy when she demanded that I follow the Liz Truss budget in September 2022? If I had done, I would have caused absolute mayhem with the public finances of Scotland.

I will draw my remarks to a close. That network is now bearing significant fruit through sharing of economic and intellectual thinking between Scotland and other jurisdictions that have significant roles to play.

All that is relevant to ensuring that we create an economy that meets the needs of all our citizens in Scotland—an economy that uses our resources wisely and plans on the basis of investment for the future. The Government’s motion indicates the steps that we need to take to ensure that we turn that into reality in the forthcoming period.

I move,

That the Parliament recognises Scotland’s international leadership in the transition to a wellbeing economy, by not only growing but transforming the economy to one that serves current and future generations, and delivers a prosperous, socially-just Scotland within safe environmental limits, where everyone can flourish; notes that this remains a defining mission for the Scottish Government, including through its leadership in forming the Wellbeing Economy Governments (WEGo) group and delivery of the National Strategy for Economic Transformation; agrees that the delivery of a wellbeing economy requires a worker- and community-led just transition to a net-zero, nature-positive economy that has equality, human rights and fair work at its heart, enabling Scotland to tackle child poverty, empower communities, build community wealth and create a socially-just society; notes the publication of the Wellbeing Economy Monitor, which tracks broader outcomes beyond GDP on issues such as health, equality, fair work and the environment, and the Wellbeing Economy Toolkit, which supports place-based economic development; commends the work of the Cross-party Group on Wellbeing Economy and partners across Scotland, and recognises that independence would allow Scotland to make greater progress, but, until then, calls for the devolution of energy and additional economic powers to the Scottish Parliament to support Scotland's transition to a wellbeing economy.

The performance of any country’s economy is not an abstract concept. The prospects for the economy, as well as its focus, are fundamental to the life chances of every person in our society. They affect the living standards of our people, the ability of people to fulfil their potential and the choices that we can make about how we use our resources. They all, as is at the heart of the debate today, on a cumulative basis affect the wellbeing of our people. That is the rationale behind this Government’s determination to pursue a wellbeing economy on behalf of the people of Scotland.

The cost of living crisis, the obvious and recognised negative consequences of the United Kingdom Government’s mini-budget last September, and the impacts of Brexit are all creating a significant impact in Scotland on the wellbeing of people, businesses, the third sector and our vital public services.

The UK budget last week outlined the gravity of the situation, with the Office for Budget Responsibility estimating the impact on household disposable income over last year and this year—a fall of 5.7 per cent—to be the highest in living memory. That represents the largest two-year fall in real living standards since Office for National Statistics records began in the 1950s, and it means that by 2027-28, real living standards will still be around 0.5 per cent below pre-pandemic levels.

UK inflation has again risen today and, although the OBR has forecast that inflation will fall by the end of 2023, the severe impact on households in Scotland of the cost of living crisis brings home the impact on wellbeing and the lack of economic resilience in the UK economy.

Sarah Boyack’s proposed member’s bill raises important and substantial issues that are very much the consideration of the Government in relation to how we take forward the wellbeing economy agenda. Given the length of her experience, Sarah Boyack will understand that I can commit to absolutely nothing this afternoon. However, I am sure that there will be a willing audience on the Government benches for those points in due course.

John Mason, in his usual forensic style, summed up the contribution of the Conservative Party to this debate, because what its amendment does is remove the following concepts from the Government’s motion: “socially just”, “net zero”, “fair work”, “community ownership”, “environmental care” and “human rights”. That sums up what the Conservative Party has to offer us.

A number of very kind things have been said by members and, as has been acknowledged, this is likely to be my final speech to Parliament as a minister in the Scottish Government, unless an urgent question is selected for tomorrow. I will simply try to lean on the Presiding Officer to ensure that that is not the case.

I am grateful to Liz Smith, Willie Rennie, Daniel Johnson, Fiona Hyslop, Emma Roddick and others for their kind remarks. I am very glad that my strategy for handling radio broadcasts has been properly interpreted by Willie Rennie as having the purpose of ensuring that nobody is any the wiser about any of the answers in these difficult circumstances.

I would like to make some remarks in closing the debate and closing the defining chapter of my professional life. I told the First Minister some months ago that I intended to step down at the end of the period in which I had temporarily returned to the finance and economy remit. I fear that I may have prompted the First Minister to do some reflection of her own at the same time.

I was struck by the comments of one commentator about my decision. He said that it was often best to have people asking, “Why are you resigning?” rather than, “Why are you staying?” After 16 years in office, I have to say that I was rather surprised, from time to time, that more people were not asking why I was still here. The absence of such comments may tell us all something, but being reminded that I appeared in Emma Roddick’s school class in Inverness in 2014 is perhaps an indication that it is time to move on.

As a 15-year-old in 1979 I joined a party that had terrible electoral prospects, so my long ministerial career has been something of a surprise. There may be some hope for some in that observation at this moment.

Over my period in office, I have exercised responsibilities across finance, the economy, the constitution, education and skills, Covid recovery, and a multitude of subjects as Deputy First Minister. Of course, I have not achieved all that I would have wanted in my ministerial life. I would have loved, Mr Fraser, to have achieved independence for Scotland, but I am confident that those who follow me will do just that.

In the spirit and substance of this debate, all my work has been focused on enhancing the wellbeing of the people of Scotland. Among the many measures that I believe have helped to do that, the concordat with local government, the expansion of early learning and childcare, the renewal of the school estate, the four harms framework for Covid recovery, a fiscal framework that protected our funding, and the budgets that prioritised investment in our public services all rank as significant moments.

But, for me, the policy intervention with which I have been most closely associated and which has had the biggest impact on the wellbeing of some, and possibly all, in our society has been confronting our country’s historical failure to protect children from abuse. The establishment of the Scottish child abuse inquiry, the passage of legislation for a scheme of redress, and the successful operation of that scheme are all now assisting some of those in our society who have been most damaged by their betrayal by others to contemplate recovery.

Those reforms came about only because of a fair-minded and non-tribal spirit in this Parliament. Without wishing to destroy his career, I say that Jamie Greene epitomised that for me on the issue of redress. I have also experienced it on other issues on other occasions. Alex Rowley and Willie Rennie can often get the greatest degree of reasonableness out of me. I have experienced it unreservedly in the partnership that we have constructed and I have nurtured with the Scottish Greens. I say gently to Parliament that there is not nearly enough of that in the Scottish Parliament today, and that I think that our discourse would be the better for it. I agree very much with Alex Rowley on that point.

I know that this will be vigorously disputed by the Opposition—Graham Simpson will probably be at the front of the queue in disputing what I am about to say—but not everything in Scotland today is awful. Yes, there are many challenges—there always will be—but there are also many wonderful things happening. As a tip from an old hand, the Opposition may find that they prosper by being just a bit more positive about Scotland and the work of her Government.

Yes, my ministerial career has been a bit of a surprise to me, but it has also been the greatest privilege of my professional life. I am grateful to the First Minister for giving me the honour of serving as Deputy First Minister, to the people of Scotland for their kindness and to Parliament for holding me to account.

I have done my best. It is now for others to fill this space. [Applause.]

Oh!