Manufacturing

Question Time — Scottish Executive — Enterprise, Lifelong Learning and Transport – in the Scottish Parliament at 2:15 pm on 22nd March 2007.

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Photo of Christine May Christine May Labour 2:15 pm, 22nd March 2007

To ask the Scottish Executive what measures it has in place to support manufacturing industry, what the value is of such support and how many jobs have been created or sustained by these measures. (S2O-12457)

Photo of Allan Wilson Allan Wilson Labour

Scottish ministers provide a wide range of support to manufacturing companies in Scotland. That includes financial support, innovation grants, practical support for companies to improve productivity and efficiency, and business and product planning services that are delivered through our enterprise agencies.

On practical support, in its first year of operation our Scottish manufacturing advisory service undertook 119 hands-on manufacturing reviews with Scottish companies, identifying a potential £19.6 million in productivity and process improvements to manufacturing companies.

On financial support, in the past five years manufacturing businesses have accepted more than 500 offers of regional selective assistance totalling some £189 million for projects that involve the planned creation or safeguarding of more than 23,000 jobs.

In addition, in the past five years our research and development support schemes, which are the small firms merit award for research and technology, support for products under research—SPUR—and SPURplus, have offered nearly £40 million to 340 projects across Scotland.

Photo of Christine May Christine May Labour

It is often suggested, particularly by the Scottish National Party, that RSA and other grants are exploited by rapacious foreign companies, which grab a grant, create low-skill, screwdriver or call-centre jobs and, having screwed every penny that they can from the system, relocate overseas. Does the minister support that view? Or does he agree that recent grants to companies such as Semifab, CRC Glenrothes and Naylor Industries—I hope that will include Tullis Russell Papermakers Ltd, too—which are all in my constituency, are for local manufacturing companies to support innovative processes that raise the manufacturing game in Scotland? Does he believe that such assistance is vital for the stability and growth of manufacturing in Scotland?

Photo of Allan Wilson Allan Wilson Labour

I do indeed and I note that in the same period to which I referred, businesses in the Fife area accepted 72 offers of RSA totalling more than £20 million. Those offers relate to projects that aim to create or safeguard more than 3,300 jobs, which is a significant contribution to the Fife economy. Of course, RSA makes an important contribution to the creation and safeguarding of jobs across Scotland.

I believe that it is folly on the part of our political opponents to level criticism at the scheme in the manner in which they do. The only people who gain from that are our competitors in places such as Ireland, who would welcome with open arms some of the inward investment that would be diverted from these shores to other parts of the country if our opponents' advice were to be followed.

Photo of Jim Mather Jim Mather Scottish National Party

I cannot help but wish that, when I was an IBM salesman, the minister had been my manager because he seems to be able only to record gains and never to account for losses.

Can the minister tell me whether, in measuring the extent of manufacturing in Scotland, job losses are accounted for and confronted? Should that not be recorded and reported to ensure a true and fair view of Scottish economic performance and Scottish jobs?

Photo of Allan Wilson Allan Wilson Labour

It would be helpful if the official Opposition, too, gave a balanced account of the performance of the Scottish economy in these and other debates. The decline in manufacturing output, to which Mr Mather refers, is of course not uniform across the sector. Areas such as chemicals, refined petroleum and food and drink have exceeded their expectations.

As far as our calculations of employment and job losses are concerned, of course we take account of losses in the manufacturing sector. However, those losses have been more than compensated for, as Mr Mather is well aware, by expanding sectors such as the service sector, the financial services sector and the construction services sector. That is why we now have a record high employment level and are second only to Denmark in the European Union 25 measurement of the creation of jobs. It is also why, for the first time in my memory, we are exceeding the rest of the United Kingdom in keeping unemployment below the rate experienced elsewhere.