Chamber and committees

I have another question about Ferguson Marine. The Scottish Government also owns CalMac Ferries, which is the biggest ferry company in the UK but does not have a repair yard, and Caledonian Maritime Assets Ltd, which owns the ferries. The vessels are repaired predominantly at Cammell Laird on Merseyside. There is surely an argument that, if we want a long and sustainable future for the Ferguson Marine yard, we should amalgamate all three companies, to give economies of scale, remove the duplication of overheads and give the yard the future that it requires. The vessels were part of CalMac Ferries before 2006. The yard could be guaranteed a future if the biggest ferry company in the UK had its own repair yard.

Thanks very much.

The other area that I wanted to look at was the green industrial strategy and the Government’s commitment to modernise compulsory purchase legislation. Will you say a wee bit about what is happening on that?

Good morning, cabinet secretary. I have questions on a couple of areas, and the first is Ferguson Marine. Recently, the committee visited Ferguson’s and saw that the yard faces a lot of challenges in its prospects for new orders and so on. I want to ask about the £14 million funding that the Government announced. What specific outcomes do you want that investment to deliver?

Okay. I will leave it at that.

The committee has had an interest in that. When we carried out our town centre and retail inquiry in November 2022, one of the issues that we looked at was compulsory purchase legislation. The feedback that we got from local authorities was that they could not use the legislation, because of a lack of funding. One of the aspects that was considered at the time was compulsory sale orders, on which, I know, the Government did a bit of work through the Scottish Land Commission in 2018. Where are we with compulsory sales orders?

How will the recently announced review of Creative Scotland help to maximise the impact of public funding for the cultural sector?

Those options are low-carbon hydrogen, clean electrofuels and sustainable aviation fuels.

We now need the transition at Grangemouth to be accelerated, and I welcome the Scottish Government’s recently published green industrial strategy.

I agree with Michelle Thomson’s point.

All that is gone, now. That led John McTernan, a former Labour adviser, to describe the decision to pull the £28 billion of investment as

“probably the most stupid decision the Labour Party has made.”

Let us also not forget Keir Starmer’s statement that he would be in favour of raising the windfall tax on oil and gas and extending it to 2029. No wonder closure of the refinery became a consideration.

We know that steps are being taken to secure Grangemouth’s future, and our inquiry considered how a just transition will be achieved in a way that benefits people, communities and businesses in the Grangemouth area.

The inquiry report recommendations sought both clarification and consideration from the Scottish Government in a number of areas—in particular, what a just transition for the Grangemouth area would look like and how all stakeholders, employees, businesses and, importantly, the local community would help to secure a just transition.

The Scottish Government’s reply to the committee’s inquiry was encouraging, with the then cabinet secretary providing a comprehensive response to the recommendations, including setting out what work was already under way, including details on the just transition plan for the Grangemouth industrial cluster, which had been announced in the Scottish Government’s 2022-23 programme for government and again in the 2023-24 programme for government.

I have already alluded to the fact that, compared with where we were when the inquiry took place and the subsequent report on Grangemouth was published, we have moved on considerably. However, the groundwork that had already been put in place by the Scottish Government to address the commitment to reducing emissions and the decarbonisation of Grangemouth provides vital support at this crucial time.

The Scottish Government, in partnership with the UK Government, is working on the delivery of an investment plan to secure Grangemouth’s industrial future and protect its skilled workforce, with a further £100 million joint investment package through the Falkirk and Grangemouth growth deal. The funding will provide support to the community and its workers, investing in local energy projects to create new opportunities for growth in the region.

It has been estimated that, over the next 30 years, the Falkirk and Grangemouth growth deal will deliver more than £628 million in economic benefit, with an employment impact of 1,660 net jobs across the Falkirk Council area.

The Scottish and UK Governments will provide tailored support to help affected workers in finding new employment. In addition, investment in the site’s long-term future through the £1.5 million joint-funded project willow has identified a short list of three options to begin building a new long-term industry at the refinery site—

I will concentrate on the report on the inquiry into a just transition for the Grangemouth area that the committee published in June last year.

Much has happened since our inquiry and the publication of the report, with Petroineos announcing the accelerated closure of the refinery at Grangemouth. Although we knew that that was going to happen in the long term, it is a blow first and foremost to the employees; undoubtedly, local communities and the local and national economy will feel the impact of the closure, too.

Grangemouth is an integrated refinery and petrochemical centre of excellence. In total, it directly employs almost 2,000 people and up to 7,000 contractors at peak times throughout the year. The site produces 65 per cent of Scotland’s refined oil products, including diesel, petrol, kerosene and jet fuel. The latest figures indicate that exports of petroleum and chemical products from the site account for 6 per cent of all Scottish exports to countries outside the UK.

We visited the Ineos site in March 2023, which allowed members of the committee to see the scale of the site and its impact on the surrounding communities. It also enabled us to observe the progress that is being made towards its net zero goals.

However, it should be noted that Petroineos declined the opportunity to provide evidence to the committee, which was disappointing, as that would have provided the company with a platform to put on record its contribution to Scotland’s net zero target. The strategy on its website states:

“‘Net zero’ by 2045 at Grangemouth is a science-based commitment that means investment in reduction measures, changes in production processes, and efficiency upgrades.”

It continues:

“INEOS will be climate-neutral ... by 2045”.

At the time of our visit, 18 months ago, there was no indication of the refinery closing. What changed? Yes, there were problems with one of the hydrocrackers at Grangemouth, but it must have come as a body blow to the sector when Labour announced that it was ditching its plans to spend £28 billion to grow the green economy, especially as Keir Starmer had said only days before that it was desperately needed, and had insisted that his Government’s commitment to the spending plan was unwavering and that it would deliver more than 50,000 jobs in Scotland. All that is gone, now.

Yes, I will.