Chamber and committees

I will talk about encouraging in another context shortly, and that might be a better way of showing exactly what I mean, and a recognition of where some of the limitations are.

Amendment 50 is an attempt to bring up the idea that, in the context of an employee-owned conversion, there could be a financing member that is external to the enterprise. Again, the committee will be very familiar with the work that Scottish Enterprise and other enterprise agencies do in trying to pitch to business angels and other external financial sources to help invest in the Scottish economy.

Amendment 47, which also relates to the ministerial statement, raises the important issue, again in the context of community wealth building, of challenging outsourcing. That is to understand that a founding principle of community wealth building is to stop leakage and to build greater self-sufficiency in a local economy. In my view, we should be encouraging insourcing and not outsourcing of public services. We have seen good examples of that in recent years. The most recent Audit Scotland report on the national health service has shown evidence of the extent to which bank and agency nursing has been reduced, and more of those services are now provided in-house. More widely than that, Mr Coffey will be familiar with HMP Kilmarnock, which was outsourced and has now been insourced, and of Cumnock community hospital, which was outsourced and is now insourced. In Lanarkshire, where Serco had the contract at Wishaw general hospital, that has now been insourced. On the railways, where Abellio and Serco had the contracts, those have now been insourced. So, what I am talking about in the amendment is perfectly consistent with the positions that have been taken in this session of Parliament.

With your indulgence, convener, I am also bound to draw on a recent STUC-commissioned report into outsourcing, which pointed out that the outsourcing of social care and soft facilities, which are often the services that are outsourced, in effect means that women’s jobs are much more likely to be outsourced than men’s jobs. That is a consideration.

Paragraph 9.3 of the STUC report addresses the five pillars of community wealth building. It says:

“Each of these elements”

of community wealth building

“is undermined by the outsourcing of public services. Smaller economic delivery units are most likely to re-spend money earned from providing services at a local level; the smallest economic unit of delivery is directly employed staff, and the shortest supply chain is direct provision.”

10:45

I turn to my amendment 48, which is also on the proposed ministerial statement. Democratic forms of ownership and financial services are, again, part and parcel of what we should be encouraging in community wealth building legislation that is passed by this Parliament. Mutually owned banks and building societies, credit unions and municipal banks should be part and parcel of the mosaic of community wealth building, which we should be considering the promotion of. I recognise that it was a feature of the committee’s stage 1 report, in paragraphs 114 to 124, which said:

“Finance is one of the five pillars of CWB”,

and I reflect on the fact that the deputy convener referred to that in her speech during the stage 1 debate.

I have dealt with amendments 49 and 50.

Amendment 51 is, again, on the ministerial statement ask, and it calls on Scottish Enterprise, Highlands and Islands Enterprise, South of Scotland Enterprise and the Scottish National Investment Bank to

“encourage and support … employee-owned businesses.”

I reflect on the fact that the chair of the Scottish National Investment Bank, Willie Watt, at a meeting of the Public Audit Committee, told me:

“employee ownership is to be encouraged, because it is good from the point of view of aligning the workforce with the success of the organisation and its long-term nature. I have long been a supporter of employee ownership.”—[Official Report, Public Audit Committee, 25 June 2025; c 35.]

What I am doing through amendment 51 is literally reflecting that view. I am also amplifying one of the principal conclusions of the Scottish Government’s review that looked into inclusive and democratic business models. Chaired by Neil McInroy, the review was launched in September 2024, and, in recommendation 11, it called for the Scottish Government to

“Grow the role of the Scottish National Investment Bank … to intentionally and specifically support”

inclusive democratic business models.

I will finish with amendments 58 and 59, which go back to insourcing rather than outsourcing municipal banks, mutual banks and building societies, and credit unions, but which, in this context, address local community wealth building partnerships.

I move amendment 46.

Thank heavens for small mercies. I thank the minister for accepting amendment 51, although I realise that it is subject to the committee’s views. I also thank him for his dialogue and for his offer of continuing dialogue between stages 2 and 3, which I will certainly take up. I welcome his open approach.

The minister’s suggestion that some of my amendments are better addressed to the economic democracy group would be all well and good if the economic democracy group had been established and was meeting, but it is my understanding that it is not. That is an interesting theoretical suggestion from the minister, but not one that we can actively take up.

On the issue of insourcing, I do not see that purely as an issue of procurement, although I have an amendment on procurement later, which will be considered by the committee at stage 2. If you look at the examples that I gave, I do not think that HMP Kilmarnock was subject to some kind of franchising or procurement exercise when it was decided to bring the prison back in-house. ScotRail and the Caledonian Sleeper service are other examples that the minister’s own Government has been prepared to implement. I recognise the point that the minister made in the stage 1 debate, about what procurement looks like, but I think that we should also be looking at insourcing versus outsourcing, not just in a procurement context. As I said, I have an amendment on procurement to come.

The final thing that I would say to the minister and committee members is that, if they have not already done so, they should visit some employee-owned businesses, such as, for Mr Fraser, Carlton Bingo in Dunfermline, which I went to. Carlton Bingo has bingo halls in Stirling and other places. Sarah Boyack and Lorna Slater would be interested in Jerba Campervans in the Lothians. For Mr Kerr, there is Clansman Dynamics in East Kilbride, which is part of the Central Scotland region. I am sure that the deputy convener, as well as Mr Kerr and I, will have an interest in Your Equipment Solutions in Falkirk. Then there is Auchrannie Resort in Arran. I look to Mr Coffey for that—although it is not in his constituency, it is employee owned and an important part of that regional economy. Let me finish with Mr Stewart. I can recommend the Krakatoa music bar venue on the quayside in Aberdeen as a fine example of an employee-owned business that really includes its workforce. Those are wonderful, pioneering businesses.

Yesterday, in the budget debate, the Cabinet Secretary for Finance and Local Government said:

“Scotland is a country of innovators and wealth creators.”—[Official Report, 13 January 2026; c 16.]

I think that those are great examples of innovation and wealth creation. I can think of no finer examples than those, and we should be using the bill to encourage the development and advancement of that part of our economy.

Amendment 61 is, again, an attempt to include Co-operative Development Scotland in the preparation of community wealth building action plans at a local level. I am concerned that its history, as well as its present and future, appears to have been written off. I think that it is an important part of the tools of economic development in Scotland. I know that it sits inside Scottish Enterprise, so I understand the minister’s argument that Scottish Enterprise will be consulted, ergo Co-operative Development Scotland will be consulted, but I am looking for something a little bit firmer than that to guarantee that that will be a dimension of the input from Scottish Enterprise and the enterprise network generally.

Amendment 65 is about having the local plan revised annually. Frankly, if the committee is not prepared to support the Scottish Government coming back to Parliament more than once every five years, it would be rather unfair to impose an annual regime on local government. I intend not to move amendment 65.

12:30

Thank you very much, convener.

What these amendments attempt to do is to promote and realise the potential of employee ownership in the economy. Instead of being quite so reliant on foreign direct investment, and instead of continuing to become more and more of a branch plant economy, we need to look at ways in which we can reintroduce more local and democratic forms of control. Employee ownership has been shown to be good for the retention and creation of jobs, and good for local and inclusive economic development, and it also cultivates longer-term thinking.

I have been an advocate of a Marcora-style law for some time. The Marcora law dates back to 1985, after Giovanni Marcora—a right-wing Italian politician, actually—introduced a statutory right for workers in Italy to be able to buy an enterprise that they worked in if it was facing closure or bankruptcy. It has since been amended to give those workers a preferential right—a right of first refusal—and it commutes their redundancy payments and three years’ worth of future unemployment benefits to help give them the capital to make the conversion. In turn, that is matched by the state on a one-to-one lira—and, more recently, euro—basis, and there is also support from co-operative federation funds.

Amendment 49 is an attempt to fashion that Marcora idea within our legislative competence here. In so doing, it would broaden the statutory right, so that it could apply not just in circumstances of bankruptcy or closure, but in the event of a business being up for sale; if the owner was, perhaps, looking for a succession plan, or if the business was the subject of a takeover or faced downsizing. In those circumstances, there would be a right for workers to make a bid to take the enterprise over. For me, this captures the spirit of the Land Reform (Scotland) Act 2003 and the Community Empowerment (Scotland) Act 2015 and brings them into the arena of industrial reform.

Yes, I think that it is absolutely central to the bill, because it is about retaining wealth in a local area and looking at ways in which we can wealth build in a community. What I am describing is a community of interest as manifested in the workforce. I also think that the proposal is in keeping with a long-standing tradition in Scotland that goes back not just to Robert Owen and New Lanark, but—and I say this to Mr Coffey—to 1761 and the Fenwick Weavers Society, which was the first co-operative society ever created.

Amendments 46 and 50 would add some practical measures that are within competence for inclusion in the community wealth building statement. Amendment 46 is a recognition that, while statutory redundancy payments and the regime that governs them are reserved, under Scots law, contract law is devolved. Again borrowing from the example of the Marcora law, which is long standing, I have sought to look at ways in which we can, within our competence, use equivalent measures. We have come up with the idea that any statutory redundancy—that is, contractual redundancy that is maybe written into an employee handbook or is in some written contractual form—could be called on to be brought forward to be commuted.

We start from where we are. I would like to have seen a much more ambitious bill in the first place, but this is largely a framework bill that is about laying down markers, and that is about encouraging rather than necessarily directly acting. What I am proposing with the amendments is that the measures are included in the ministerial plan and any future ministerial statement, and that the issue is addressed at that level.

If that is the case, I will not move it.

Amendment 52 simply seeks to insert into the legislation Co-operative Development Scotland, which was established in 2006. It has, in my view, been cut to the bone. It has been allowed to wither on the vine. It is woefully underresourced, although I have not had a chance to look at yesterday’s budget announcement. The long-term position is that it has been allowed to become marginalised.

Somebody said to me that there is one part-time member of staff working on employee ownership and one member of staff working on co-operative development. For Co-operative Development Scotland, that is a clear indication of massive underresourcing. It still appears on the enterprise agencies’ websites as the arm of the enterprise agencies for co-operative development. It is still on the Scottish Enterprise website, advertising one-to-one sessions with specialist advisers for those interested in converting to co-operative and employee ownership. For that reason, I think it should be explicitly included in the bill.

My second amendment in this group, amendment 53, revisits the suggestion from the Government that we review statements and plans only once every five years. I am quite interested in five-year plans when it comes to economic development—[Laughter.]—but I reflect on the fact that an interval of five years could mean that a statement is not made within a session of Parliament.

I am concerned, from listening to what Lorna Slater said, that perhaps she thinks that an annual return to such things, which is my Chartist instinct, is too frequent, but I put it to her and to others who take that view that every five years is far too big an interval. For that reason, my amendment asks the committee to consider a statement being produced every year.

The review group’s report, which was published in September 2024 and to which we have already referred this morning, had the full title of “Developing Scotland’s Economy: Increasing The Role Of Inclusive And Democratic Business Models”. In its opening pages, it said about inclusive and democratic business models that

“Around the world, they are not considered a ‘sideline’ to the mainstream economy, but a vital, growing and essential part of economic success.”

To achieve the goal of mainstreaming such models and making them successful, we must collect data and measure what is happening. My amendment 54 picks up from the review group’s findings—namely, recommendation 3, which states:

“Investment in data and evidence on IDBMs is required to support policy and service design.”

That is the main point that I wanted to make on this group of amendments. More generally, I think that there need to be transparency, openness and data sharing, so that we can make informed public policy choices.

I am a little confused because I would have thought that an observer from the UHI’s court going along to meetings of the college board of management would have had some kind of role in communicating and challenging some of the decisions that were being made, particularly given that we have ended up with you appearing before the Public Audit Committee of the Scottish Parliament and there having been a section 22 report by Audit Scotland. We have heard from Tiffany Ritchie that this is almost an unprecedented situation. I suppose the question is why that was allowed to happen.

I think that Mike Baxter wants to come in, so I will bring him in and then I will ask Graham Simpson to put his questions to the witnesses.