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Chamber and committees

Meeting date: Tuesday, September 18, 2018

Meeting of the Parliament 18 September 2018

Agenda: Time for Reflection, Topical Question Time, Bank Closures, Business Motion, Parliamentary Bureau Motion, Decision Time, United Nations International Day of Peace 2018


Topical Question Time

Migration Advisory Committee Report

To ask the Scottish Government what its position is on the recent Migration Advisory Committee report and its implications for Scotland. (S5T-01225)

As this is my first time speaking as Minister for Europe, Migration and International Development, I draw members’ attention to my voluntary entry in the register of members’ interests. For transparency, I refer the chamber to the fact that my partner is employed by Christian Aid Scotland.

Before I answer Gordon MacDonald’s question directly, it is important for me, as a new minister, to say that inward migration is crucial to Scotland’s growth and prosperity. People who choose to make Scotland their home provide a vital contribution to our country’s economy, they enhance our collective social and cultural wellbeing, and they help to make Scotland the open and forward-looking nation that it is today. Since the Brexit vote, the Scottish Government has been consistently clear that we unequivocally value and welcome the positive contribution that migrants make to our country. As a new minister, I want to make that affirmation absolutely clear.

The Migration Advisory Committee report that was published this morning will be deeply disappointing to businesses and employers across Scotland. Employers want a system that recognises the importance of European Economic Area citizens; that is simple and low cost; and which meets their sectors’ needs. As the British Future report showed yesterday, people across Scotland also want a system that gives the Scottish Government more responsibility. Today’s report acknowledges none of that.

The Scottish Government will continue to listen to business. We need to ensure that we will have enough healthcare professionals, teachers and other professionals working in Scotland, that we will have the workers for a thriving rural economy, and that our universities will be able to attract and retain talent from around the world.

The Migration Advisory Committee was not asked to consider those issues, and it did not fully consider the social and cultural benefits that come from being an open and connected European nation. The Government will therefore consider whether to commission further research and independent expert advice, where that is necessary to ensure that Scotland’s needs are taken into account.

Do the recommendations in the MAC report—for example, the idea that Scotland’s demographic issues, including its ageing working-age population, can be solved by raising the retirement age—completely misunderstand much of the Scottish context? Surely there are simpler and more effective ways of tackling a shortfall of workers in our public services, such as attracting more migrants of working age to live here.

Absolutely. Gordon MacDonald has raised important points about demographics that the MAC report did not consider appropriately or fully. According to official statistics, all of Scotland’s population increase in the next 25 years is due to come from migration. However, the MAC report did little to consider Scotland’s needs; instead, it suggested—remarkably—that increasing the pension age would be a preferable approach for managing demographic change. That is a completely unsustainable position that many people across Scotland will reject, as we in the Scottish Government do.

Yesterday’s British Future report, which was based on ICM polling, showed that there is clear public support in Scotland for giving more powers to the Scottish Government, which is accountable to this Parliament, to develop a tailored approach to migration that would meet Scotland’s distinct needs and which the Parliament would endorse.

The MAC report acknowledges that the devolution of immigration powers is ultimately a political choice. The Scottish Government’s outward-looking, welcoming and positive approach to immigration could not be further removed from the right-wing rhetoric that emanates from the United Kingdom Government in the Brexit context. The poll in yesterday’s Herald showed that two thirds of Scots want immigration powers to be devolved. Is it not high time that Westminster listened to that demand?

Absolutely. It is important to reiterate that paragraph 7.72 of the MAC report acknowledges that devolution of immigration powers is ultimately a political choice. Gordon MacDonald is right to say that the Scottish Government’s

“outward-looking, welcoming and positive approach to immigration could not be further removed from the right-wing rhetoric that emanates from the United Kingdom Government”.

A year ago, the migration observatory at the University of Oxford published a report that specifically considered a regional migration system. It concluded that the arguments against a regional visa system are not about practicalities, but about politics.

As has been mentioned, the British Future report that was published yesterday provided clear messages. First, it made it abundantly clear that people do not trust the UK Government to manage immigration. It said that only 15 per cent of the people whom ICM surveyed think that the UK Government has

“managed immigration into the UK competently and fairly.”

The report also said:

“The current immigration system does not command public trust and support.”

Secondly, and very importantly to us in this Parliament, people were also clear in the poll by ICM about the sort of change that they want to see. Sixty-four per cent of people in Scotland agreed with the proposal that the Governments in Scotland, Wales and Northern Ireland should have the power to decide how many visas are issued to people who want to work in those parts of the UK.

There is a clear, building and growing consensus that in order to meet Scotland’s economic and demographic needs, we need more powers to come to this Parliament so that we can create tailored solutions. It is time for the UK Government to listen to the calls from business, universities and across civic society, and to listen to the people of Scotland, of whom two thirds believe that more powers should come to this Parliament, so that we can manage our migration system in a more humane and forward-looking manner.

Does the minister agree that we should end the discrimination against European Union workers that is mentioned in the report? The report’s authors say that they “are not convinced” that a route should be created for low-skilled workers. The minister will be aware that tier 2 visas currently apply to a list of occupations in which there are shortages, including in cybersecurity, paediatrics and games design.

I agree that Scotland should have a say in an immigration policy that is fit for the whole UK, and I have argued that consistently, but I would like to know what list of occupations the Scottish Government has put forward for tier 2 visas, and precisely what dialogue ministers have had to make the case for Scotland’s interests to be addressed in that list of occupations. Surely there must be a case for low-skilled workers to be on that list.

I thank Pauline McNeill for that important question. There is an interesting balance between high-skilled and low-skilled workers. The way that the report prefers some people over others is disappointing, and will be disappointing to industries across Scotland, including tourism and hospitality, agriculture and social care, which rely on low-skilled workers.

We welcome the fact that the report argues for a lifting of the cap for tier 2, but that will not be a substantial enough change to bring to the Scottish economy the number of workers that we need to fulfil the demands that exist in the public and private sectors.

With regard to the occupations list, there is reference to the matter in paragraph 7.73 of the report, in which there is acknowledgement that there is a difference between the shortage occupation list in Scotland and the other devolved areas and that of the UK. As minister, I have pressed the UK Government on that. I met Caroline Nokes, the Minister of State for Immigration, in the summer and pressed her on that point, and she gave me an undertaking that the UK Government would look at how there could be Scottish Government input and, potentially, wider input from Scottish civic society and business to that occupation list in order to make sure that it is fit for purpose.

I am pursuing a follow-up meeting with the secretary of state in order to continue to press the point. I will also meet the chairman of the MAC and will take up the matter with him, in due course.

I say to the minister that social care workers are not “low-skilled”, in my opinion.

Social attitudes to immigration in Scotland are very similar to those across the rest of the UK. Does the minister agree that putting limits on the number of people migrating to the UK is arbitrary, and that what we need is a fair, humane and non-discriminatory policy that meets the needs of the nations and regions of the UK in an inclusive way?

I thank Neil Findlay, too, for that important question. I share much of the sentiment in it.

First, I absolutely value all skills in our economy. The point that I was making is that one of the problems with the MAC report is that it includes a hierarchy that stresses some skills more than others. I deeply value the commitment of social care workers in my constituency and throughout Scotland. That is also the view of other Scottish Government ministers. Our social care sector is highly regarded, and we want the people who work in it to stay and continue to contribute, and to take care of the people whom we know—our neighbours, friends and people in our communities.

Neil Findlay was absolutely right to bring up the wider point about the UK Government’s arbitrary, insensitive, unhelpful, inflexible and unworkable commitment to bringing migration down to the tens of thousands. He was right to point out the wrong-headedness of that approach, both logically and in principle. The fact that the report asks for a lifting of the cap for tier 2 suggests that there should be a shift in thinking on that point across the board. I share the sentiment in Neil Findlay’s question on that point.

Ferguson Marine

To ask the Scottish Government what its response is to reports that £45 million has been loaned to Ferguson Marine, and whether this is related to the provision of two new ferries being built under contract to Caledonian Maritime Assets Ltd. (S5T-01217)

Scottish shipbuilding has a proud history and a bright future. That is why the Government will continue to support the industry to thrive and reach its full potential.

Earlier this year, I advised the Finance and Constitution Committee that ministers had approved commercial loan facilities of up to £45 million for Ferguson Marine. The loan facilities were reported to Audit Scotland, and the expenditure will be recorded in the Scottish Government’s consolidated accounts. The delayed delivery of the two new CalMac Ferries vessels is disappointing, but the commercial loan facilities that have been provided to Ferguson Marine will support the delivery of those vessels and help the business to diversify.

Unfortunately, it took a number of freedom of information requests and press reports for the Government to come to the chamber and give Parliament more information about those loans. The opening line of the FOI response says:

“The Scottish Government does not hold detailed information on all public funding provided to private companies in Scotland.”

I am sorry, but I find that absolutely incredible. Why does the Scottish Government not hold those details?

I will ask some specific questions to allow the cabinet secretary to clarify matters. What was the purpose of the £15 million loan? What due diligence was done on the firm before the loan was made? What analysis has been done of how the money has been spent?

The additional £30 million loan facility was explicitly not to go towards the CMAL ferries or to pay for budget overruns in those contracts; instead, in contrast to what the cabinet secretary has just said, it was designed to win new business opportunities. Will the cabinet secretary clarify for the record that none of the money that has been loaned to Ferguson Marine has been or will be used on the existing troubled ferry contracts?

That is quite an incredible position for the Conservatives to hold. It is clear that they do not speak to each other. It is just not true to say that I have not informed Parliament of the loans. As I said in my initial answer, I have done so; in particular, I have informed the Finance and Constitution Committee. I did so on 24 April and on 27 June. I am under no obligation to present that information to Parliament, but I did so. In the spirit of transparency, I went beyond expectations to offer that information to the Finance and Constitution Committee, and that was the appropriate thing to do.

Most members of Parliament understand issues of commercial confidentiality; certainly, members of the Finance and Constitution Committee, including the responsible Conservative members of that committee, understand what commercial confidentiality is. There are some matters that stay private. We have, of course, again fulfilled our freedom of information obligations.

On support for Ferguson Marine, it is incredible that a member who seeks to be elected in the west of Scotland tries to undermine Ferguson Marine in the fashion that Jamie Greene has. The financial support for Ferguson Marine is, of course, to ensure the yard’s viability and continued work and to ensure that it has working capital. Those were the specifics relating to the request. Of course we want the delivery of the new vessels as well, but it is good for a Government to engage in the fashion that we have to support Scottish shipbuilding.

I say again that, without any obligation to do so, I wrote to the Finance and Constitution Committee and informed it of the loans that the Scottish Government was providing.

This is not about whether the Government should or should not support the marine industry; this is about accountability, transparency from the Government and good governance. I have heard about none of that today from the cabinet secretary.

The project is already delayed by at least a year and is already tens of millions of pounds over budget. There is also talk of a dispute between the yard owners, the Government and CMAL over project management and where the liability for those financial overruns lies. Delays cost money. Will the cabinet secretary tell us—in simple terms—who will pick up the tab for the dispute? Is it Ferguson Marine or the Scottish taxpayer?

Let me be clear about the Government’s investment in ferries. Since 2007, we have invested more than £1 billion in ferry services. We have deployed new ferries to the network, which has enhanced the CalMac fleet.

Do the Conservatives not even welcome the fact that the Scottish Government is supporting Scottish shipbuilding? What is so wrong with that position? We are delivering 400 jobs at Ferguson Marine, and there are new apprenticeships, too. Is that not to be welcomed by the Conservatives and others in the chamber?

Of course the delays are not welcome; they are unfortunate. However, the Government is committed to this investment for new vessels.

I say again that Jamie Greene may not be familiar with issues of commercial confidentiality. Of course due diligence has been conducted. That question was posed to me by the member who now seems more interested in other matters. Of course due diligence was undertaken in relation to the commercial loans. These are commercial loans, with commercial terms and bound by commercial confidentiality. Is the member seriously suggesting that we should not respect that and not respect the fact that, through our interventions, the Government has helped not only to save the yard but to deliver 400 jobs in that part of Scotland? The vessels will be delivered. We have provided support through the loans to address the working capital issue that Ferguson Marine raised.

I say again that the more responsible members of the Conservative Party who are on the Finance and Constitution Committee were alerted to the loans. What I did went over and above the transparency that is expected of me as a cabinet secretary. In fact, it was in order to be fully transparent that I offered that information about the loans to the committee, which respected that.

I am aware that a committee of which Jamie Greene is a member has been invited out to the yard to find out more about the vessels. I do not think that he has visited the yard yet, despite that offer having been made.

The Government will do the right thing by Scottish industry and jobs. If that means that a Scottish shipbuilder is building vessels for our CalMac fleet, surely that should be welcomed.

Does the cabinet secretary agree with me that it is the height of hypocrisy for a Conservative MSP, particularly one with a Port Glasgow connection, to come to the chamber and talk down shipbuilding in my constituency and talk down high-quality and skilled jobs, bearing in mind the devastation that his party brought to shipbuilding in 1979, when the Conservative Government shut the yards, paid off thousands and devastated communities, including the cabinet secretary’s and mine?

I agree with Stuart McMillan. It has been important not only for shipbuilding but for industry that this Government has taken bold decisions to support Scottish industry across Scotland. This issue is a good example of that. The Tories are not satisfied with devastating Scottish industry because, even now in opposition, they are undermining and attacking our efforts to support the Scottish economy. It is surprising for a member who proclaims to be for jobs in the west of Scotland, including Inverclyde, to try to undermine the Scottish Government’s efforts in the chamber today.

The cabinet secretary will be aware that the costs of completing the two ferries that Ferguson Marine is building to serve the Clyde and Hebrides network are rising, and that the company claims that that is due to insufficient design work by CMAL prior to it issuing the invitation to tender. Ferguson Marine has described the discussions with CMAL as frustrating. Does the cabinet secretary agree that it is time to get CMAL, the Government and Ferguson Marine around the table to resolve the issues and to get the ferries completed as soon as possible at a fair price that not only delivers for increasingly frustrated passengers but helps to secure the future of this important shipyard and its workforce?

I thank the member for the way in which he has raised that issue. That is a far more helpful contribution than that of the Tories, who are simply trying to undermine the loan support that we have given to the company.

Clearly, as finance secretary, I am interested in procurement right across the public sector, and I think that there is something to be said for ensuring that all parties continue to get round the table and talk, so that we make the necessary progress.

The question was, in essence, about the commercial loan that was offered. I think that I have been able to show that I absolutely have complied with the Parliament’s expectation—and I have gone above and beyond that by offering the information to the Finance and Constitution Committee.

As to further work in relation to CMAL, which is the procuring authority, and Ferguson Marine, we can have further discussion in that regard.

As a member of the Rural Economy and Connectivity Committee, I have heard how important new ferries are for Scotland. We have heard that we need a new ferry to be ordered every year for the next 10 years. I do not dispute that; I am asking the cabinet secretary whether he thinks that due diligence has been correctly done in this case, given that the company to which the loan has been made has not submitted audited accounts since 2015. That raises the question of whether it is diligent to lend the company the money. Where is the due diligence?

For any loan offer, we would expect due diligence to be complied with. It has been. External consultants have worked in that regard, as well as finance officials. Members would expect me to appreciate and abide by commercial confidentiality—[Interruption.]

I can certainly reassure the Parliament that due diligence was carried out. This is a commercial loan, with commercial terms. The benefits to Scotland and Scottish shipbuilding are clear. I am surprised that the Conservatives are turning on the company involved, in the fashion in which they are—[Interruption.] The Tories seem quite agitated this afternoon—it is their question, I have to say.

The Conservatives might want to talk to their colleagues on the Finance and Constitution Committee about the information that has been mentioned. I pointed out to Mr Greene that he was invited to visit the yard; Edward Mountain would have been given the same invitation if he is a member of the same committee, as I think he is.

I have been happy to engage on questions and FOI requests, and if the Finance and Constitution Committee wants further information, I will engage positively with it. I remind members again that I volunteered information on the loan to the committee, although I was under no obligation to do so. I think that that was the responsible thing to do. I have not been dragged to the chamber; I have been quite forthcoming in presenting information. Of course, we will add the further information to which I referred in my initial answer.

We have just enough time for another supplementary question.

Thank you, Presiding Officer.

I invite the cabinet secretary to continue to be forthcoming. Does he consider the problem to be CMAL, not Ferguson? When will he sort that out?

I am sure that Jackie Baillie well understands that it would not be appropriate for me to take sides in the chamber in any procurement issue or dispute. As I think that I said to her Labour colleague, if there is anything further that I can do in terms of procurement responsibility, I will engage in that. I will be genuinely happy to engage with Jackie Baillie on this and any other matter.