Debate: Economy

Linda spoke in the debate on 2 December.

“Like other members, I have read Jeremy Purvis’s paper, “Making Scotland the Most Innovative and Entrepreneurial Economy in the World”. I have some sympathy with its aspirations and the aspirations that Mr Purvis has espoused today. I am grateful for the historical aspect to the paper, which discusses the enterprise networks over the years. It reminded me about the previous, cluttered landscape that was difficult to work one’s way around. One thing that the SNP Government should be commended for is that it has hugely simplified that landscape.

I was particularly interested in certain parts of the paper. Mr Purvis wants us to consider an innovation-driven economy, in which

“new ideas and skills … emphasise the high end of the value chain, rather than replication.”

We could all get behind that idea and there are examples of how we can move forward on that, such as renewables, which Stuart McMillan mentioned. I would cite biotechnology as a cutting-edge industry in Scotland, for example Controlled Therapeutics in East Kilbride, which makes medical products. The company has been a great success story, having won export awards and a Queen’s award for enterprise. We have to celebrate our achievements rather than talking ourselves down all the time.

I recently chaired an event about exporting architectural skills. Scotland’s architects and engineers are working all over the world. Some have done so with the help of SDI but many have gone out there and done it on their own. We have the entrepreneurs and the innovation-driven trailblazers.

I was interested in the section in the paper about science. That ties in with the Government’s science strategy. There are issues in the paper with which we are all in accord and that we can take forward.

Debates such as this are good because we get to bang on about things that really matter to us. I have managed to find a reference in Mr Purvis’s paper to something that I care hugely about, which is languages. Jeremy Purvis is right when he says:

“Language skills are crucial to the competitiveness of Scotland.”

I am glad that we have strategies in place to improve Scotland’s language skills—strategies that can be backed by everyone.

Ross Finnie talked about small and medium-sized enterprises, which comprise 95 per cent of businesses in this country, and about business start-ups. It is true that Scotland’s record on business start-ups has not been great, pre and post-recession and, indeed, pre-SNP. The SNP is improving things. The small business bonus scheme has helped businesses to survive the desperate times that mismanagement of the UK economy has brought upon them and will help them to thrive when they have a chance to get out from under the cloud.

Leaving some disposable income in the pockets of Scotland’s council tax payers has helped, as have social benefits. The policy of freezing the council tax has meant that more money circulates in Scotland’s economy, giving it a boost. I contend that those and other policies of the Scottish Government have helped the economic recovery programme. They have helped the Scottish economy to survive and have been innovative in themselves.

We can use Government to improve the economy but we could do a lot more with full economic powers. Imagine how much more we could do if the Secretary of State for Scotland had decided to put the findings of the Steel commission rather than of Calman up for consideration as the basis for the Scotland Bill. A debate on that is taking place next week so today I will only repeat what I have said before, which is that it is my firm, unshakeable belief that the Scottish Government should have substantial authority over the levers of power that most affect the Scottish economy: infrastructure; education and skills; business regulation; and taxation. Of course, only the first two are under Scottish control. As the Steel commission said,

“there is a need for Scotland to have its hands more effectively on these four key levers and be able to pull all of them together.”

…Jeremy Purvis’s paper talked about privatising Scottish Water. Like Murdo Fraser, Mr Purvis calls it mutualisation, although I have concerns that the end result is the same. The latest version of the statement of funding policy published alongside the UK budget talks about how

“Government may take into account proceeds from the sales of … assets in setting its grant to the devolved administrations when capital receipts are realised as a result of privatisation of a public sector trading body or a major change in the role of the public sector”.

In such circumstances, it says,

“Treasury Ministers reserve the right to reduce the grant to the devolved administration to reflect receipts.”

I wonder whether Mr Purvis, in his closing remarks, could reassure us that he has considered that fully and discussed it with his UK counterparts.

Derek Brownlee: Would it not be more appropriate for the Scottish Government to discuss it with the Treasury? Is that not exactly the point that the SFT made in its paper, which considered not privatisation but a different model, too?

Linda Fabiani: The Scottish Government is constantly in discussion with the Treasury over such issues. Mr Purvis put in his paper—reflected in the motion—that he believes that that is the way forward, so I would ask him whether he has had such discussions and whether he can give us some comfort that he is not merely signing away one of Scotland’s assets.

I have some other issues with the proposal from Jeremy Purvis. Where would the boundaries of the regional development banks lie? I have concerns about expecting one body to control grant funding, lending, skills and training and destination management for all businesses in an area. I worry about bureaucracy.

Although I do not agree with everything that Jeremy Purvis has said on the issue, he has put ideas forward and I hope that they will be taken into account by Campbell Christie’s commission. The debate is worthwhile.

The full debate can be read at

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