– in the Scottish Parliament at 3:08 pm on 12th January 2000.

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Photo of Sam Galbraith Sam Galbraith Labour 3:08 pm, 12th January 2000

With permission, Presiding Officer, I would like to make a statement.

On 16 December last year, I made a full statement to Parliament setting out the background to the financial problems surrounding the redevelopment of Hampden and details of the rescue package that had been negotiated over several months.

I remind members that the redevelopment of Hampden was a millennium project and that the Scottish Office was a minor funder, whose financial contribution was agreed in 1996 when the previous Conservative Administration was in power. Because of the importance of Hampden to the nation, the Scottish Executive has played a key role, together with the Millennium Commission, in seeking to broker a rescue package for the project.

The construction phase of the project has resulted in Queen's Park Football Club incurring debts in excess of £6 million, which it is unable to pay. When I made my statement in December, I made it clear that negotiations on the package were not complete. However, we believed that final agreement on all elements of the proposed rescue deal would be reached within a matter of days and that the various parties involved would enter into legal agreements formalising the arrangements. The rescue package and the associated legal agreements are complex and problems and complications arose in processing that level of detail.

The situation has been made more complicated by the decision of the directors of Queen's Park to petition the court on Monday of this week for an interim administration order in respect of the company and for the appointment of managers ad interim. An interim order was granted and two partners of Arthur Andersen—a firm of chartered accountants—have been appointed as managers ad interim. We understand that the appointment will be effective from Friday, for a period of eight working days. The ad interim managers have already started work on assessing the club's financial position and the state of play of the negotiations over the rescue package.

We have noted that the club's petition to the court claims that the company is at present insolvent and that, because of creditor pressure and a lack of working capital, it needs a moratorium to allow it to obtain the necessary agreements and to pursue discussions with a variety of parties. We also note that the petition states that the company believes that, subject to the right arrangements being put in place, it can have a viable future. The future of the company is now, to some extent, in the hands of the court. However Scottish ministers remain willing, in principle, to participate in any arrangements that are based on those that were previously agreed for the rescue of the stadium and, subject to other matters being sorted out, Queen's Park Football Club.

Whatever the arguments may be surrounding the appointment of managers ad interim, we are approaching the situation as a further opportunity to progress the negotiations over the rescue deal within a constructive and objective framework. The consultants who are acting for the co-funders had a useful meeting with the interim managers yesterday. We hope that a rescue deal remains a realistic option that can be achieved in the near future. The continuing difficulties in concluding the deal have reignited debate about the need for, and the viability of, Hampden and the future management arrangements.

A modern stadium with excellent facilities has been built. Surely everyone wants it to be put to good use. The imperative now is to complete the deal so that the new management arrangements can be put in place. I commend this statement to the Parliament.

Photo of Nicola Sturgeon Nicola Sturgeon Scottish National Party

I thank the minister for updating Parliament so promptly, following the latest turn of events in the long-running Hampden saga, although I am sure that he will agree that many of the details surrounding the current situation remain outwith the public domain. I share the sentiments of the minister's concluding remarks. On behalf of the Scottish National party, I sincerely wish him well in bringing the matter to a satisfactory conclusion and in securing the future of the national stadium. However, there are legitimate questions to be asked on how we have come to be in this position, and on why the Executive seems, yet again, to have been taken by surprise by the turn of events.

Why were the actions of Queen's Park, on Monday, such a bolt out of the blue to the minister? If Queen's Park was on board with the rescue package on 16 December, and if the minister was keeping in close contact with the negotiations between then and now, why did he not foresee the actions of Queen's Park? Is it a more accurate interpretation to say that there has always been a question mark over Queen's Park's agreement with the details of the rescue package, that the minister's statement to Parliament on 16 December was premature, and was perhaps brought about by the pressure on him to say something to Parliament, and that he was simply keeping his fingers crossed and hoping—in vain, as it turns out—that Queen's Park could be brought on board in the agreement?

The statement that was issued by Queen's Park two days before the minister's statement, which said that, in its view, there was no agreement, suggests that that latter interpretation might be the truth of the matter. Either way, does the minister accept that the handling of the matter has left a great deal to be desired, and will he tell the Parliament whether there is a plan B? If there is such a plan, what is it?

Photo of Sam Galbraith Sam Galbraith Labour

Somewhat uncharacteristically, Nicola Sturgeon started off rather well, on behalf of the nationalists, and was being constructive and conciliatory. I was about to welcome the changed tone and nature of her speech. However, true to form, she let her guard slip and, once again, she resorted to her usual standard of abuse. I accept that such accusations of incompetence and incapability are the meat and drink of politics, but I always wait for the constructive part that usually follows. I am still waiting in this case and I fear that I shall have to wait rather a long time.

We negotiated the deal in good faith. I made a statement to Parliament in December, partly in response to demands from the nationalists that I do so. If subsequent events have taught me anything, it is that I was right not to want to say anything about the subject too early. The complex negotiations are best discussed in private and I will stay with that position until a conclusion is reached, whereupon I will be pleased to come back to the Parliament to give a full presentation.

Photo of Brian Monteith Brian Monteith Conservative

I thank the minister for his prompt attendance to deliver the emergency statement. However, there is a sense of "Play it again, Sam," not just because he has to come before us yet again, but because there is not a great deal of content in what he tells us.

On 16 December, the minister told us that the extra costs on agreed projects through increased specifications added to the overall cost. We were told that additional works that were not part of the original project added to the cost and that accelerated costs because of the holding of the May 1999 Scottish cup final in the stadium also caused the cost to increase. However, we do not know who agreed to allow those costs to go up. We still wait to hear that.

Like Nicola Sturgeon, I am concerned about the fact that the events came as a shock to the minister. We read in the papers the day after the minister gave his statement that Queen's Park questioned the nature of the rescue package. Even at that early stage, alarm bells should have been ringing, as they should have been last week when stories appeared in the papers suggesting that the club was unhappy. How can the minister be surprised at the actions of the club?

Will the minister reassure us that the deal has not failed because of the reported shortfall of between £85,000 and £100,000? That story—in common with many stories about the stadium—has reverberated through the media without our having any way of knowing whether it is true. Does he agree that, if the story is true, the directors of Queen's Park should put their hands in their pockets to find the necessary money as, although they will be leasing the stadium to the Scottish Football Association, they will be in ownership of a stadium of which we can all be proud?

Will the minister further assure us that no further public funds will be made available beyond those that he has already negotiated? If the rescue package fails, will he make available to Parliament the consultants' report that he has—understandably—kept confidential for commercial reasons? If the rescue package fails, we are entitled to know what went wrong and what is in the report. That will let us know why such a disaster befell us.

In his statement, the minister said that Queen's Park took the action that it did because of pressure from creditors. It would be useful to know whether the creditors were involved at any stage of the rescue package negotiations. If they were not, that would explain why the action was taken and why it came as a surprise to the minister.

Photo of Sam Galbraith Sam Galbraith Labour

If I had a hair on my head for every time I had heard the phrase, "Play it again, Sam," I would not be bald—and neither would Mr Monteith.

Mr Monteith raised some specific points. The board of National Stadium plc authorised the additional work to be carried out by McAlpine. Mr Monteith also asked about the shortfall in the money that is supposed to be in place, but no one, including Queen's Park, has any idea where that story came from. As the Executive has not been asked to provide more funds, and it is our understanding that we will not be, it is not necessary for us to do so.

As members know, I have tried to make available all the information: what we are responsible for, what we put in, the management arrangements and so on. Mr Monteith will appreciate that when private companies give the Scottish Executive confidential information, they must be able to trust us with that information. That also applies to inward investment; I am sure that he understands that. Within those parameters, I will be willing to make available everything that I can once the matter has been settled.

Mr Monteith has been supportive of what the Executive has been trying to do with the Hampden project, and I am grateful to him for that. I assure him that I will keep him as up to date as I can, although it is my desire, from now on, to conduct the negotiations in private. Parliament will be suitably informed when anything of significance happens or the deal is concluded one way or another.

Photo of Ian Jenkins Ian Jenkins Liberal Democrat

On behalf of the Liberal Democrats, I thank the minister for his statement.

During the past century, Hampden became a focus—cynics might say the only popular focus—of Scottish national identity. It has a special place in my heart: I may be the only member of this Parliament who has been ordered off at Hampden. The circumstances are not as bad as that might sound, but it is a true story.

Does the minister agree that, across Scotland, there is a strong sentimental attachment to Hampden Park and to Queen's Park Football Club, although not at any price? Does he further agree that, in such negotiations, it is unwise for anyone to paint themselves into a corner, or for there to be no flexibility? Will he give members an unqualified assurance that he will act firmly but undogmatically in the matter, and that he will do his best to achieve the kind of resolution that members have asked for?

Looking to the future, will the minister tell the chamber what he believes to be the status of the stadium's business plan?

Photo of Sam Galbraith Sam Galbraith Labour

I am grateful to Ian Jenkins for his constructive and helpful comments. He expressed an opinion that is widespread in Scotland—that Hampden is important for the nation and that it is more than just a building, as it represents some other iconic relationships. However, there are people who did not wish to rescue Hampden, although we did not face that view, as the previous Conservative Government took the decision. We were left trying to resolve the problem of huge debts. We have worked hard to do that and we are almost there. It is my intention to resolve the problem in a way that secures not only the future of Queen's Park Football Club—Scotland's oldest club—but that of Hampden.

Before we even considered putting in any money, part of the deal was that the stadium must have a viable business plan. That subject has been examined in great detail and a viable business plan is in place. This is a commercial exercise—the private company that will deal with the stadium will have to make money, and a business plan is in place to do that.

In order for there to be a national stadium which can survive, which makes a profit and which is a viable business, the Scottish Football Association has to run it, as it constitutes more than 50 per cent of the business plan. Without the involvement of the SFA, there is no viable Scottish national stadium. That is partly the reason why the SFA has been asked to manage the stadium.

Photo of Mike Watson Mike Watson Labour

I echo Ian Jenkins's comments about the considerable symbolic significance of Hampden Park, which is why I welcome the minister's statement. However, no doubt he will agree that it is about time that people began to pull together for Hampden. The sniping that we have seen from the Tories and the SNP in the media over the past two days is not helpful, notwithstanding their comments today. It is about time that we moved forward jointly. Hampden is—or should be—a national treasure.

Did I hear the minister correctly when he said that no further public money would be provided and, indeed, that none had been asked for, despite the developments of the past two days? Will he confirm that, contrary to some newspaper reports, the £2.2 million that he announced in December as being a key part of the rescue package remains on the table and will remain a key part of that rescue package when it is finally concluded?

Photo of Sam Galbraith Sam Galbraith Labour

The negotiated deal will be the basis for taking those matters forward. The money is on the table, but not one penny will be paid out until the deal is signed and sealed. That is the important aspect. Many agree on the iconic nature of Hampden, but there are some who do not.

Photo of Dennis Canavan Dennis Canavan Independent

I realise the important historical contribution that Queen's Park Football Club has made to Scottish football, but is it not an anachronism that in this, the 21 st century, the national stadium should be the property of one third division club, whose directors seem to be trying to hold the SFA and the Scottish Executive to ransom? Bearing it in mind that more than £40 million of public money, including lottery money, has already been invested in the project, will the minister seek a solution involving at least partial public ownership, so that the people of Scotland will have a stake in their national stadium?

Photo of Sam Galbraith Sam Galbraith Labour

The arrangement is not the responsibility of the Executive—it was set up under the previous Administration. I cannot remember Mr Canavan's views at that time, although it would be unlike him not to have had a view and pronounced on it. It is an unusual circumstance that an amateur third division club should own Scotland's national stadium, but the reality—and the legal position—is that Hampden is owned by Queen's Park Football Club. We might not like it, and we might want it some other way, but short of theft, it belongs to the club and we cannot take it away. What we have to do is—

Photo of Sam Galbraith Sam Galbraith Labour

I know that Tommy wants to nationalise the bank and the top 200 companies, but most people who put their hands up for that are in new Labour now, as Tommy will be one day, so that is okay.

My job is to take what we have at the moment and ensure the future, not just of Queen's Park Football Club but, most important, of all the stadiums in this country. The deal is on the table, and I am working towards achieving that in the near future.

Photo of Mary Mulligan Mary Mulligan Labour

The minister referred to the financial difficulties that Queen's Park seems to suggest are the reason why it is backing out of the deal. However, it has been suggested that another issue was that the SFA was to take over the management of Hampden. Will the minister comment on that and tell us why the co-funders took the decision that the SFA would manage the stadium?

Photo of Sam Galbraith Sam Galbraith Labour

It is not quite true to say that Queen's Park has backed out of the deal. I understand that it still wants the deal—that is its decision. To protect its own interests, it went into temporary administration. Hampden will still be owned by Queen's Park, and the SFA will take it over as a lease and run it. It will pay rent to Queen's Park—the sum of £200,000, index-linked, and guaranteed every year for 20 years—and Queen's Park has the use of the stadium and no overheads.

Part of the reason why we think that the SFA must take over is that without the SFA, there is no business plan. The SFA is more than 50 per cent of the business plan, and without it, the plan is not a viable option. It has assured us that it will set up a wholly owned subsidiary to run the stadium, whereupon it will bring in the expertise for running the national stadium as a separate company. We think that it is correct that the national stadium should be embedded in the governing body of the sport and that in the management arrangement we have a good plan, which the administrator will be considering. I hope that it can be taken forward.

Photo of Fiona McLeod Fiona McLeod Scottish National Party

Given the millions of pounds of public money and the intense public interest in Hampden, does the minister really still believe that it is best practice for the Government to continue to negotiate Hampden's future behind closed doors? As recently as yesterday, such a meeting was held with the interim managers, and it continues to be the Executive's position as restated by the minister today. That gives no accountability to the public or to this Parliament.

Does the minister not think that secrecy may have contributed to the embarrassment in which he finds himself today? Will he acknowledge that he might have got the handling of this sorry saga badly wrong? In admitting that failure, does he accept that this Parliament and its Education, Culture and Sport Committee must be given the co-ordinating role in securing Hampden's future as our national football stadium?

Photo of Sam Galbraith Sam Galbraith Labour

I think that the response by the rest of the Parliament probably answers that rather threapy question. It is the role of the committees to give advice and assistance to the Executive and, more important, to hold it up to scrutiny. However, the idea that the committees are the Executive is complete and utter nonsense. The idea that a committee of this Parliament should sit down with the bankers, lawyers, co-funders and contractors and negotiate a deal is probably one of the most stupid suggestions that I have ever heard from the SNP in my time. If that was the constructive comment that I have been waiting for, I should not have bothered waiting.

Photo of John McAllion John McAllion Labour

Is it not incredible that so much public money should be invested in a privately owned and controlled asset, and thereby left exposed to the whims of company directors who control and own the asset? Surely this whole sorry saga gives the lie to those who argue that questions of public ownership no longer matter in this day and age.

Does the minister agree that if there is to be a national stadium, built largely with public money, that national stadium should be under at least a degree of public ownership and control? Surely we have an opportunity to turn Queen's Park's difficulties into the people's opportunity by extending the degree of public ownership and control over the national stadium. That is what the fans and the people want, never mind what this Executive wants.

Photo of Sam Galbraith Sam Galbraith Labour

I am grateful to John McAllion for his contribution. John and I have worked together closely on many projects throughout our political career and I take his words—

Photo of Sam Galbraith Sam Galbraith Labour

John McAllion is more new Labour than I am. [Laughter.] Remember, I am the person who was expelled from the Scottish Labour party by Alex Neil for being too left wing. [Laughter.]

I say to my honourable friend that this was clearly not the best arrangement. It is obvious that it could have been set up only under the previous Conservative Government, for which I cannot take any responsibility. We would have hoped to do things differently.

Photo of Sandra White Sandra White Scottish National Party

If I had a pound for every time that Mr Galbraith or a Labour member of the Executive blamed previous Governments, I would be a millionaire. I have plenty of hair, so Mr Galbraith need not mention that. Is it not time that the Executive stopped tossing about that argument and considered something constructive? Mr Galbraith is constantly saying that he has not heard anything constructive. Perhaps my question will be and he will be able to give me a constructive answer.

I have taken on board Mr Galbraith's comments and what he said about the SFA, but I feel that the other members' comments have also been constructive. Does the minister agree that, whatever happens over the next few days, what is required so that the public can be satisfied that their money is being spent wisely is an open and above-board competitive tendering process—something that new Labour is very much in favour of? Does he not think that that would be much fairer than the SFA's being the only organisation involved in the tendering process?

Previously I asked the minister about the differences with local government and about how the SFA had managed to get itself into this tendering process. If he agrees with me, can he advise Parliament how that will affect the SFA's ability to compete, given that until now it has been the only organisation to be given access to ministers, co-funders' meetings, the business plan and the consultants' reports—in fact, access to everything to which we in this Parliament have been denied access? That is a constructive question, and I hope that Mr Galbraith will answer it constructively.

Photo of Sam Galbraith Sam Galbraith Labour

I am grateful for the constructive way in which that contribution was made. I am particularly delighted to note the nationalists' conversion to competitive tendering. That is most interesting, but consistency was never a feature of their party, so there is no reason why it should be present on this issue.

I presume that Sandra White means competitive tendering to run the stadium.

Photo of Sam Galbraith Sam Galbraith Labour

The stadium is owned by Queen's Park. Unless we steal it from the club, there can be no competitive tendering. Confiscation might be a new SNP policy—I realise that SNP members make it up as they go along.

I thought that I had made this clear, but I will do so again. The reason why the SFA has been asked to run the stadium is that without the SFA there is no business plan for the stadium. The SFA represents more than 50 per cent of the business plan. Therefore, we think that it is correct and proper to ask the SFA to run the stadium. Also, it is proper that a truly national stadium should be embedded in the structures of the governing body. Those are the overwhelming reasons why the SFA should run the stadium.

Photo of John Young John Young Conservative

Assuming, as we all hope, that an agreement is reached, does the minister believe in his heart of hearts that Hampden is a viable proposition, bearing it in mind that we also have Ibrox and Parkhead? As far as I know, Glasgow is the only city in Europe that will have three stadiums with capacities of roughly 50,000.

Photo of Sam Galbraith Sam Galbraith Labour

We are taking special care of Glasgow. It is getting three stadiums when everybody else has to make do with two.

I think that Hampden is a viable stadium. We always said that we would put no money into it until it was clear that there was a viable business plan. All the advice that we have received from our business consultants and the bankers who are closely involved in the rescue deal is that the business plan and Hampden's commercial future are viable.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I thank the minister for his statement, and I thank him and his team for their work. I know that they have put in huge efforts to rescue the stadium from this debacle, despite the fact that the Executive has not had a major funding role.

However, there are a number of concerns. Although I do not agree with what Fiona McLeod said, I believe that the Education, Culture and Sport Committee has a role to play. Will the minister assure me that when negotiations are completed and a deal is finally settled, he will come before the committee to answer questions such as why Queen's Park has been put in charge of £65 million of public—not Government—money, and why the SFA has been given the role that it has?

Photo of Sam Galbraith Sam Galbraith Labour

The committee has an important role in scrutinising what the Executive has done. It is particularly useful, as it can call in other parties. I urge the committee to do that and to pore over the arrangements. I will be only too pleased to come before the committee and to give a full and frank account of what I have done in my role. Although we have taken on an important role, we are not the negotiator, and many others are involved. I can be answerable for my role and for what the Executive has done. I will be more than happy to come to the committee once the negotiations are complete, one way or another.

What I do not want is to have negotiations in public. Recent events should tell us that the best place for them to take place is in private.