Rural Policy

– in the Scottish Parliament at 2:15 pm on 6th March 2008.

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Photo of Alex Fergusson Alex Fergusson None 2:15 pm, 6th March 2008

The next item of business is a debate on motion S3M-1489, in the name of Richard Lochhead, on the Organisation for Economic Co-operation and Development review of Scotland's rural policy. I invite all members who wish to take part in the debate to press their request-to-speak buttons now.

Photo of Richard Lochhead Richard Lochhead Scottish National Party 2:56 pm, 6th March 2008

Having just returned from Norway—that small, independent and prosperous nation—a couple of hours ago, I tell Parliament that this Government takes seriously the opportunity to learn from other nations. I was there to support our extremely valuable seafood sector, but used the opportunity to meet my Norwegian counterpart to discuss the many agendas that are common to our two north-western European nations. I am keen to return to Norway in the near future to learn more about Norway's successful rural policies and its rural development agenda.

We have set time aside today for a short but important debate on the recent OECD review of rural policy in Scotland. As many members will be aware, representatives of the OECD visited Scotland in early 2007 and, after gathering evidence, took a few months to put together a report to assess and make recommendations on our rural policies. I do not doubt that all members agree that it is useful to compare and contrast Scotland with other countries and to have the insight of external specialists who can give us the benefit of their impartial views and advice.

With a new Government in Scotland, the OECD report is timely and comes hot on the heels of reports into the future of our rural communities by the Carnegie Commission for Rural Community Development, which has issued its charter for rural communities, and the Scottish Consumer Council, which looked at rural advocacy. All three reports recognise that our rural communities are special places and all three give us plenty of food for thought. One million of us live in rural Scotland. We all agree that it has tremendous assets that are renowned worldwide—our countryside, wildlife, culture and above all, the energy, enthusiasm and commitment of the people who make rural Scotland a great place to live.

We believe that the OECD report is a vote of confidence in the general direction of travel of the rural policies that have been adopted by the new Scottish Government. It is also a vote of confidence in the direction of travel that has been taken since we won our own Parliament nine years ago.

A great number of positives were identified by the OECD. For instance, people in rural Scotland believe that they have a better quality of life and live in safe neighbourhoods. In contrast to many OECD rural regions, the population in rural Scotland is on the increase, as opposed to the decrease that has been witnessed in many European countries. Our rural regions have the highest levels of tertiary education attainment of any of the OECD nations. The OECD visitors also commented favourably on the level of innovation in rural Scotland, both in terms of quantity and quality.

As the Cabinet Secretary for Rural Affairs and the Environment, I must be the first to ensure that we do not allow the good news to mask the considerable challenges that face many of our rural communities. For instance, the report states that accessible rural areas—those closest to our urban populations—have the highest incomes in Scotland. That is a healthy sign and it is good news, but the report also flags up the significant challenges that face our more remote communities. It states:

"However, there is still a significant divide between remote and accessible rural areas with regions facing serious challenges in terms of ageing, outmigration, poor economic performance and access to modern services."

The report comments that, in rural Scotland, employment is higher and unemployment is lower than in urban areas, but members will know from experience that many areas of Scotland suffer from low wages.

Photo of Jeremy Purvis Jeremy Purvis Liberal Democrat

The cabinet secretary will know about the particular challenges that the Borders face. The OECD report touches on the enterprise framework. Does the cabinet secretary agree that a distinct area such as the Borders, which has its own challenges, deserves a specific budget that is allotted to economic development in the area to allow progress to be made? Does he support the retention of a specific budget for enterprise support for the Borders?

Photo of Richard Lochhead Richard Lochhead Scottish National Party

Jeremy Purvis raises an important issue for the south of Scotland. I was struck by how the OECD report alludes to some of the challenges that face the south of Scotland. That is why it is so important that we digest the assessment in the report.

Members will be aware of the hidden rural poverty in many of the communities that we represent. Research is under way, in partnership with rural stakeholders, on many of the rural poverty indicators, so that we can measure rural poverty better. Therefore, although we can celebrate the many positives that the report highlights, we in the Government and Parliament must never take our eyes off the significant challenges that many areas face. Last summer, Michael Russell and I travelled round many rural communities and have continued to do so. We listen closely to the concerns that are expressed to us when we visit rural communities and we learn from them.

The Government has not only listened; it has responded with action to what we have heard in the past 10 months. In a mere 10 months, the Government has established a track record on dealing with many of the challenges that face rural Scotland. Our document "Firm Foundations: The Future of Housing in Scotland" has a strong rural dimension and covers tackling the affordable housing crisis that exists in many rural communities. We have given a commitment to publish a consultation document on the introduction of a legislative presumption against closure of rural schools, in recognition of the detrimental impact that it can have on rural development.

We are cutting or abolishing business rates for small businesses the length and breadth of rural Scotland. As the Minister for Transport, Infrastructure and Climate Change said during question time just before the debate, we are launching a pilot scheme for a road equivalent tariff to benefit the Western Isles, which will allow us to consider whether that is the way forward in helping to build our islands into mainstream Scotland through economic development.

We have adopted ambitious renewable energy targets and given a commitment to develop a national food policy, which are two issues that the OECD identified as having big potential for rural areas in Scotland. I am sure that many members are struck, as I am, by the fact that the OECD identifies—with some alarm—that more than 100 agencies are involved in delivering rural development in Scotland. That vindicates strongly the Scottish Government's decision—which was made after the evidence for the report was gathered—to streamline the number of public organisations that operate in Scotland, to ensure that those that remain are much more effective and efficient, and to tackle bureaucracy and red tape. Too many communities and businesses in rural Scotland are hampered by the complexity of the cocktail of rural initiatives and agencies. As members well know, we are addressing that.

Much of the commentary in the OECD report is thought provoking and deserves mature and considered debate in Parliament and its committees in the months ahead. For instance, the report questions the sector-by-sector approach to delivering rural policy and asks whether too much emphasis is put on that, rather than on the alternatives. It also questions whether environmental expenditure as part of the Scottish rural development programme is likely to create jobs and economic growth—I am sure that many members disagree with that assertion. The report flags up the possibility of implementing rural development through a regional approach. It also addresses the enterprise agencies in Scotland, which we discussed through the intervention that I took earlier, and gives us food for thought on that.

Photo of Richard Lochhead Richard Lochhead Scottish National Party

I have already given way on the subject.

Some crucial messages come out of the OECD report. First, as we all agree, rural Scotland is a diverse area. The needs of and solutions for the Western Isles are different from those in Galloway and the north-east of Scotland. Therefore, a one-size-fits-all approach to delivering rural development policy in Scotland is not appropriate. I hope that we can all agree that there must be more emphasis on our communities taking a bottom-up approach to rural development. We are pleased that that will be addressed, given that it fits well with the Scottish National Party Government's approach to rural development, which is about empowering rural communities.

I hope that all members accept that since 1999 devolution has been good for consulting, given the extension of consultation of rural stakeholders when policy is developed. The OECD report addresses that issue. However, I hope that we all agree that we need to move on to the next stage and empower rural communities to take more control of their destinies, rather than just being consulted by central Government.

The Scottish rural development programme reflects local priorities, as does the LEADER programme, which builds capacity in rural communities. Of course, the lottery has a role to play in that, too.

At the village hall summit, I spoke to about 200 people who represent community councils, community associations and village hall committees in Scotland. Members of such organisations do sterling work and give up much of their free time to serve their communities. I was struck by the number of remarkable individuals that we have in rural communities in Scotland and by the number of inspirational community organisations, which have had take their destiny into their own hands in seeking outside finance and expert assistance so that they could provide what their communities required, whether it was a village hall or other facility. There are many skills out there, and we must encourage those skills to be utilised for rural Scotland.

The Government has announced that it will soon appoint a rural development council. The first task I will give the council will be to consider the findings and recommendations of the three reports that I mentioned, in particular the OECD report, and to work with the Government on the way forward. We are determined to take more action to ensure that sustainable economic growth benefits not just urban Scotland but the whole of Scotland. That is essential.

Rural Scotland is a special place to live. If Parliament and the Government work with the voluntary, private and public sectors, rural Scotland can go from strength to strength. We congratulate the OECD for its report, which we welcome. I look forward to listening to members' speeches in the debate.

I move,

That the Parliament recognises the progress made in supporting rural development since the establishment of the Scottish Parliament; welcomes the analysis set out in the independent review of rural policy in Scotland by the OECD, and believes that this report and other reports on the future of rural Scotland published in recent months provide the opportunity to further develop rural policy to ensure that all our rural communities enjoy the economic, social and environmental benefits of sustainable economic growth and that they are empowered to greater influence their own destiny.

Photo of Sarah Boyack Sarah Boyack Labour 3:07 pm, 6th March 2008

I agree with the cabinet secretary that the OECD report is timely. The Scottish Parliament is in the early years of its third session, so now is a good time to review its first few years.

The report provides strong affirmation of the Scottish Parliament's success as part of the wider United Kingdom framework. Due to the policies and investment of the Labour-Lib Dem coalition, strong economic performance and a stable investment framework at UK Government level, there has been sustained investment throughout Scotland. Successful policies have grown the economy and there has been record investment in rural health services and schools. There has been investment in broadband, which is crucial to teleworking, and the development of a thriving service sector is also identified in the OECD report.

There has been major investment in Highlands and Islands Enterprise in order to boost our economic performance and to enable companies to develop and grow in some of our most fragile areas. The thriving economy around Inverness is a testament to the success of that focused approach. Work on local energy has been another fantastic success. As a result of HIE's energy company work, loads of schemes have been set up in rural Scotland.

We have also had eight years of sustained investment in transport infrastructure. There are new airports at Stornoway and Kirkwall. There has been massive new investment in ferries and there has been sustained roads investment—the investment in the road to the isles is most notable. Tolls on the Skye bridge were frozen and then removed.

Our national parks have been established. Communities have been empowered through land reform, and crofting has been revitalised.

The OECD makes it clear that there have been major successes in our rural economies and in our quality of life. Health and education indicators show that rural areas are performing well compared with the rest of Scotland. Scotland's rural regions have the highest level of tertiary education attainment among predominantly rural regions in the OECD. The UHI Millennium Institute has played a crucial role in opening up new opportunities.

We should not focus just on work at Scottish Government level; there is a good story about local councils' investment on the ground and work on service delivery. People in the health service throughout rural Scotland have also played their part, as have thousands of others in rural areas—entrepreneurs, land managers, farmers and foresters.

However, some of the country's most fragile and remote areas have fared less well, and I very much agree with the cabinet secretary that we need to focus on the serious challenges of much lower levels of employment, lack of economic progress, rural poverty and low wages in those areas that the OECD report puts centre stage.

Therefore, I strongly agree with the report that we must avoid a one-size-fits-all approach to our rural areas. We can certainly learn from the coherent and very successful approach that has been taken in the Highlands and Islands, where there has been partnership involving key agencies, local authorities, Highlands and Islands Enterprise—which has become a powerful and really successful organisation—and the Government's big service departments in major investment programmes.

I suspect that the area that could learn the most from considering that kind of successful approach and putting in place new structures and partnerships is the south of Scotland, and I agree with the report that we need to focus more on that part of the country. I have attended a couple of meetings at which stakeholders in the area have made it clear that they need more focused and up- front support from the Scottish Government, and I hope that this afternoon the Government will commit to putting this issue on the agenda and working with those stakeholders to identify structures that will maximise the economic opportunities that clearly exist.

The report identifies four key challenges for the Scottish Government. Our amendment would add a fifth: the particular vulnerability of rural areas to the changes in funding and reduction in investment that will come from the Scottish Government's new budget.

On land, property and housing, we agree that the crucial issues are effective land use planning, maximising the opportunities that are presented by our land, and ensuring that throughout the country we have sufficient stock to provide properties for sale and for rent. Ironically, a side effect of the success of accessible rural areas is increased competition for land, which has led to rising house prices. Many people who move into new housing developments in those areas are commuters who earn higher salaries in our major towns and cities; indeed, I know of people from my constituency who have moved out of the city to accessible parts of Midlothian and Fife. Because they earn more than the people who have traditionally lived in those areas, local residents who work locally and earn rural incomes cannot afford to get on the housing ladder. Moreover, because of the long-term impact of right to buy and the low level of housing association starts in rural areas, local people also have insufficient opportunities to rent. That must be part of the agenda.

Labour members also agree with the OECD report that economic diversification in sectors such as tourism and energy production is crucial, and believe that the rural development programme must be part of the solution in that regard. The question is whether the substantial investment that is being made in rural areas is having the maximum impact, so we need to work with traditional rural industries such as farming, forestry and crofting to identify not only opportunities for diversification but other new economic opportunities that will ensure the most effective use of our land resource.

However, as the report makes clear, we need co-ordination. All those developments must be linked into wildlife tourism, recreation opportunities, the development of renewables opportunities and the creation of sustainable economic performance. One thing that the Minister for Environment could do is to support the renewables industry, which is working with the farming industry on more small-scale and medium-scale renewables developments, particularly in wind power. It is a big mistake simply to take the biofuels route; we have to consider existing technologies.

As for forestry, which is one of the success stories that were identified by the OECD, I hope that, when he winds up, the minister will give us some good news about the biomass fund, about which there is some uncertainty. In fact, I have been told that it is due to run out in March.

A key issue is to link our rural and urban areas to spread success from urban to rural Scotland and ensure inclusion. We are not starting with a blank sheet of paper—although agencies must think about, and plan more effectively for, the future. There are good examples of strategic planning in local authorities, which is partly why Labour strongly supported the development of the national planning framework.

I should point out that the outcry over the Borders rail link announcement was caused by the fact that it did not set out a start date, never mind a finish date, for the project. The irony is that it exemplifies the kind of project we need to link rural and urban Scotland. The disappointment throughout the chamber yesterday was palpable and genuine, although the Minister for Transport, Infrastructure and Climate Change thought that we were making it up. That vital project was kicked off by Gus Macdonald before the Parliament was established with an economic development paper that examined options, and I developed that into a full-blown analysis to let us progress the project, to enable people in rural communities to access economic opportunities in the capital and—crucially—to enable communities and companies in the Borders to develop the economic opportunities that could come from better connections.

The Scottish Government's budget could undermine such success. The voluntary sector is now finding that it is a victim of budget decisions and the price of the budget is undermining progress and new opportunities that we have created. Nicola Sturgeon's revised formula for health boards will reduce funding for rural health boards in the Borders, Dumfries, the Highlands and the Western Isles. Cuts are being passed on to rural communities from the budget. East Lothian Council faces a cut in its home-help budget and Highland Council is cutting teachers as well as its clothing grant, which helps the poorest families. Argyll and Bute Council has a £1 million shortfall thanks to the settlement that the Scottish National Party Government has handed down. Highlands and Islands Enterprise faces more than £50 million of cuts in the next three years: HIE is another success story that the SNP budget could undermine.

I hope that we will have a constructive debate and that the SNP will reflect on all our comments.

Progress has been sustained and we must not jeopardise it. We cannot turn our backs on Scotland's rural areas. We must move forward. I am happy to support the Tory and Lib Dem amendments, which would add references to issues that the Parliament needs to debate.

I move amendment S3M-1489.2, to insert at end:

"however is concerned that recent Scottish Government budget decisions have the capacity to set back progress made."

Photo of John Scott John Scott Conservative 3:16 pm, 6th March 2008

I declare an interest as a farmer and refer members to my entry in the register of members' interests.

I welcome the OECD report on Scotland's rural policy. In the short time that is available, I will highlight points of agreement and disagreement and the Conservative view on the necessary future policy direction. On a positive note, I welcome the report's conclusion that Scottish rural areas are unique and should be more cherished. I welcome the fact that in accessible rural Scotland, people apparently enjoy better health, safer neighbourhoods, a higher rate of home ownership and higher incomes, although the suggestion is that that is in spite of, rather than because of, Government policy.

On the negative side, the report says that in remoter areas, serious challenges need to be addressed in relation to ageing, out-migration, poor economic performance and a lack of access to modern services. For good measure, the report notes multiple indices of deprivation in our most fragile areas because of low incomes—for example, the gross domestic product per capita in the Western Isles is 60 per cent of the European Union average—as well as net out-migration, low enterprise formation and poor health. A picture emerges of a two-tier Scotland in which accessible rural Scotland—the parts that are close to our towns and cities—is much better off than our inaccessible and remote areas, as the cabinet secretary said.

As politicians, we must strive to improve poor or insufficient rural housing, employment opportunities where jobs are scarce, and accessibility, as Sarah Boyack said. However, that is easier said than done. We must recognise that, despite the upbeat tone of the Government's motion, all is not rosy in the garden of rural Scotland. It is undoubted that having more than 100 agencies working on rural issues is

"costly and ineffective, and that a 'proper joiner' needs to be found", as the report notes. I welcome the minister's comment on that and on the rural development council.

Scottish Conservatives believe that the report's criticism that the Government's approach is centralised, poorly integrated, top-down and inflexible and lacks serious grass-roots involvement is justified. That position—which has, in fairness, evolved over many years—must now be addressed by the Government.

Photo of Jeremy Purvis Jeremy Purvis Liberal Democrat

Does the member share my concerns about the removal of Scottish Enterprise Borders and the adoption of a more centralised model?

Photo of John Scott John Scott Conservative

I share Mr Purvis's concern, but I trust that other ways will be found to address it.

The report does not get it all right, as it suggests that the Scottish Government spends too much on supporting our rural areas through the rural development programme whereas—as The Scotsman helpfully pointed out last week—from 2000 to 2006, Scotland received £54 per hectare of farmed area, which is the lowest figure in Europe. The report gets that one wrong. Now is not the time to divert the meagre support away from land in rural Scotland, because that would put Scottish farmers and managers at an even greater competitive disadvantage compared with our European neighbours.

The December agriculture census figures that were released yesterday show a continuing trend of reducing beef, sheep and pig numbers on Scottish farms. That points out starkly the historic and long-term lack of profitability in those sectors and heralds likely further job losses in the most fragile sector in rural Scotland, because it is the labour-intensive sector in Scottish agriculture. Only when profitability returns to agriculture will people and staff also return. That is a key factor in today's debate, which focuses in part on deprivation in rural Scotland.

However, although the report is essentially an audit of recent times, the future is much brighter for rural Scotland, as food security is emerging as a key issue that politicians worldwide have to address. The World Bank has warned that, by 2030, food demand will double as world population rises. However, because of oil prices hitting $100 a barrel, land is moving from wheat production to biofuel production, while global warming is reducing the food-producing capability of land north and south of the equator. Droughts have destroyed Australia's agriculture output in the past seven years and are now starting to affect New Zealand. To say that food security is an emerging issue is a gentle way of saying that food scarcity is just round the corner. The sooner politicians worldwide wake up and smell the coffee and start to deal with that, the better. The OECD has also suggested—conservatively, in my view—that food prices will rise between 20 per cent and 50 per cent in the next decade. That will have huge implications for people on fixed incomes, particularly the elderly, as the era of cheap food comes to an end.

According to the United Nations, drought, deforestation and climate instability are responsible for the loss of 250 million acres of fertile soil each year and global warming is causing sea levels to rise dramatically. Indeed, the Intergovernmental Panel on Climate Change estimates that a 1m sea-level rise will cause one third of the world's total crop land to be swamped and rendered unusable. At the current rate of sea-level rise, that will happen in the next 100 years.

The scenario is stark. Fertile land will have to return to being farmed to its full capability. Set-aside will become a memory of the 20 years of plenty that we have enjoyed since 1986. We are debating the OECD report, but I urge the minister to consider devoting parliamentary time to a debate on food security and how to start addressing the problem. The issue cannot be ignored any longer. I know that the minister raised it at the NFU Scotland council meeting Dunblane a couple of weeks ago.

In the meantime, more must be done to correct the underlying structural and infrastructural issues that are highlighted in the OECD report. For that reason, I will move the amendment in my name and urge Parliament to support it.

I move amendment S3M-1489.1, to insert at end:

"providing that the Scottish Government takes action to address the specific policy delivery concerns identified by the OECD including 'centralisation and the lack of adequate bottom-up participation', 'weak integration', 'an overlap of different approaches and agencies' and 'the extreme complexity of both the design and the delivery system linked with rural policy'."

Photo of Mike Rumbles Mike Rumbles Liberal Democrat 3:22 pm, 6th March 2008

The OECD's rural policy review showed that, on average, rural areas in Scotland perform better on socioeconomic and wellbeing indicators than urban areas. The population in accessible rural areas generally has the highest incomes. Rural Scotland also demonstrates better health standards than urban Scotland with, for instance, three years' higher life expectancy, lower cancer rates and lower emergency admissions levels. Scotland's rural regions have the highest levels of tertiary educational attainment for predominantly rural regions anywhere in the OECD. Rural areas have higher employment rates and lower unemployment rates cent than urban areas. The levels of neighbourhood safety are higher, as are home ownership levels.

John Scott asked whether everything in the garden is rosy. The OECD report also shows that there is a significant divide between remote and accessible rural areas, and that divide will not be bridged unless the Government invests sufficient funds in providing high-quality infrastructure, such as public transport and broadband, to our most remote communities.

The report also makes a strong case for decentralising the delivery of regional policy. That approach has long been advocated by Liberal Democrats and is certainly at odds with the SNP Government's current policy of dismantling the local enterprise companies and regional transport partnerships. It is also at odds with the Government's decision to cut Scotland's rural affairs budget by 6.5 per cent in real terms over the next three years.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

Oh, it is. I am surprised that the minister does not know what his own officials have said to the Rural Affairs and Environment Committee.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

It certainly is. The minister gave the evidence to the committee.

I note that Richard Lochhead refused to acknowledge the damage that he is doing in his lack of response to the intervention by my colleague, Jeremy Purvis, on behalf of the Borders economy. However, those cuts in the overall rural budget—which the ministers now do not accept, although they did in committee—have to be paid for from somewhere. That is why our farmers have had to put up with the Government top-slicing their subsidies by increasing so-called voluntary modulation, which Ross Finnie held at 5 per cent but Richard Lochhead has pushed to almost double that level.

The Government has also reneged on the level of its commitment to fund a new entrants scheme for farmers. The promised £70 million has become only £10 million—and that is not new investment, because it has to come from existing agri-environment schemes. By the way, it turns out that the scheme is not so much a new entrants scheme, because to apply for it farmers will have to be under 40 but already the head of a farming business in receipt of subsidies. It is not so much a new entrants scheme as a succession fund for farmers. That is not the way to build a successful rural economy.

On getting rural and remote transport right, if we had time we could address the road equivalent tariff trial, which seems designed to help only the islands that voted for the SNP. What a way to run a country.

Rural housing is a hugely important issue. What does the Government do instead of encouraging the take-up of the croft house grant scheme, for instance? It cuts its budget from £2.7 million to just £800,000.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

I will give way later if I have time. I have only half the time that the cabinet secretary had to speak in the debate.

There has not been much help for our crofters. In my area of Aberdeenshire, the council-house waiting list has rocketed in the past year from 4,000 people to more than 6,500 people. There is a housing crisis in Scotland, but there seems to be a huge amount of complacency from the Government.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

I am not as deferential as John Scott.

If we do not address the crisis soon, it will have a dramatic impact on the economy. Last week's announcement by the Government that it is funding 100 new houses jointly with private enterprise by 2011 is mere whistling in the wind—it is only a start. In my view, that is a missed opportunity for radical action.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

No.

Aberdeenshire Council is doing tremendous things to address the issue in its area—on its own, without the Government's help. As we would expect from a Liberal Democrat-led council, it is doing well. It is doing what we should all be doing. I hope that the Government will consider this. [Interruption.] The ministers should be quiet and listen—they might learn something. The council has three initiatives. First, from this week it is offering an increase in grant from £500 to £5,000 to people who occupy, but do not need, three-bedroom and four-bedroom homes and who are willing to move. That will help many of our homeless families.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

I will if I have time.

The council is reported to be applying for pressured area status to prevent the losses that it is suffering in its housing stock and it has decided to start building council houses again.

I mentioned just a few of the important issues that have to be addressed and I have identified some ways to make progress on them in our amendment. However, I make no apology for focusing on housing and the lack of action on it from our Scottish Government. There is a lot to do and, so far, the Government has failed miserably in its attempts to tackle the really serious issues that our rural communities face. We should not be cutting the rural budget and we should not be paying lip service to the rural housing crisis. What we need from this Government is not fine words and rhetoric, which is all we got from Richard Lochhead—we heard nothing specific at all—but real action. So far, the Government has failed in that regard and I urge members to support the Liberal Democrat amendment.

I move amendment S3M-1489.3, to insert at end:

"considers that the Scottish Government's cut in funding for rural development and affordable housing does not match the OECD report's recommendations, and therefore calls on the Scottish Government to bring forward substantive measures to tackle rural housing shortages such as Community Land Trust schemes, an extension of the Croft House Grant Scheme and the development of redundant farm land for affordable housing."

Photo of Aileen Campbell Aileen Campbell Scottish National Party 3:28 pm, 6th March 2008

Today's debate allows us to consider the OECD report as a test of policies that have affected the rural areas of Scotland in the past and to see where we can take our precious rural areas in future, in order that they may be prosperous and dynamic once again.

As members have said, there is much to be pleased about in the report. It shows that rural Scotland as a whole has good socioeconomic indicators compared with urban areas, with some parts displaying the highest GDP per capita growth in Scotland. However, there can be no room for complacency in protecting livelihoods and communities in rural Scotland.

I grew up in Perthshire and, although I do not represent that area, my upbringing there allows me to understand the experiences of those who live in the countryside in the south of Scotland. I grew up on my family's tenant farm, which I loved as a child. People in the countryside have a sense of freedom, see the seasons change and grow up with a spiritual connection to the land. No report can ever relay that. However, when people hit their teens, the sight of the first daffodils in spring is less appealing when they feel isolated and remote.

In common with many young people who live in Scotland's countryside, I left and headed for the city lights to study. The briefing from the south of Scotland alliance shows that the working age population in the south of Scotland is forecast to decline, partly because of young people leaving the area for education. I suspect that the tale is similar throughout the rest of rural Scotland. I am keen, therefore, for the Government to explore ways to keep young people in rural areas, which will ensure that those areas are sustainable, diverse and vibrant places that people want to stay in or return to.

People in rural areas seem to make do with their lot and feel that not having access to all the pleasures of 21st century life is a normal state of affairs simply because they live in the countryside. A woman came to me about problems that she was having with her heating. She is elderly and lives at the southernmost tip of Clydesdale, and had resigned herself to the fact that her problem had not been solved simply because she lived in the countryside. However, that should not be the case.

I had the pleasure, at the start of the year, of meeting people from the ambulance service in Biggar. They believe that, because they are operating in a rural area, they are forgotten about, despite the fact that they provide a vital and often life-saving service.

We should not forget that rural Scotland does not necessarily equate with agricultural Scotland. Rural South Lanarkshire and Ayrshire have farms, but they also have a vast number of mining villages. Living in those often forgotten about places are people who have seen coal and jobs come and go and have experienced a huge sense of environmental injustice. I urge the Government to remember those areas when developing a distinct rural development policy, as recommended by the OECD.

The fact that none of those points is new suggests that now is the time to use the OECD report to kick-start a rural renaissance, to show the people of rural Scotland that we value them and want to showcase what their areas have to offer. The OECD report gives good examples of ways in which that can be achieved.

We need to improve our infrastructure—my Corsa can testify to that, as it has taken an awful beating when travelling across the vast area of the south of Scotland.

Photo of Jeremy Purvis Jeremy Purvis Liberal Democrat

Does Aileen Campbell agree with John Scott and me that it is important to retain a specific budget to support economic development in the Borders, which is part of the region that she represents?

Photo of Aileen Campbell Aileen Campbell Scottish National Party

I will deal with the south of Scotland as a whole in the rest of my speech.

We definitely need to maintain the links between our urban and rural areas, not so the urban way of life can be imposed on the rural one, but so that people, including tourists, can easily access our countryside.

It will come as no surprise to ministers that I, as a South of Scotland MSP, will make a special plea for the area. The OECD report notes that the dedicated policy framework for the Highlands and Islands convention has worked well. Perhaps, as the south of Scotland alliance suggests in its briefing, now is the time to consider what lessons the south of Scotland can learn from that convention.

No one can deny that the south of Scotland has much to offer. From Burns in Ayrshire to John Muir's house in Dunbar, the south is festooned with history, culture and places to see and visit, including a world heritage site. Encouraging tourism is a no-brainer, and I hope that the cross-cutting work between the portfolios in the new Government manages to create a decent strategy to take advantage of the south of Scotland's cultural rich pickings. However, the Government will always be hard pressed to actively rejuvenate the countryside when policies from London mean that crucial lifelines such as post offices continue to close and fuel prices negatively impinge on our rural dwellers, and when Westminster abandons Scotland's farmers when they face economic ruin, such as after the foot-and-mouth disease crisis.

I remind the Government that rural Scotland does not simply mean farming Scotland. Further, it does not just mean the Highlands and Islands. Rural Scotland has been heartened by the work that has been done so far by the Government, and I urge ministers to continue on their path to rejuvenate our countryside and restore confidence in it.

Photo of Elaine Murray Elaine Murray Labour 3:33 pm, 6th March 2008

The OECD report demonstrates that Scotland's rural areas are performing relatively well. In some cases, they are performing better than the rest of the United Kingdom or the OECD average. For example, although GDP per head remains lower for rural areas than for intermediate and urban areas, the rates of growth in most Scottish rural areas are greater than the OECD average.

The report states that the Scottish rural development programme for the period up to 2013 is sound and has clear objectives. I appreciate that the cabinet secretary was good enough to acknowledge the role of the previous Executive in achieving that success. However, as Mr Lochhead indicated, the report recommends improvements, and it is important that they are considered seriously and that complacency is avoided. For example, the report recommends replacing the traditional sector-based approach with a place-based approach. That change would see the introduction of a local, multisector, bottom-up approach that addresses the linkages between aspects of rural life, such as transportation and service needs, scarcity of land for development and affordable housing, and the need for further diversification.

As the MSP for the Dumfries constituency, I am particularly interested in the comments and recommendations that relate to the south of Scotland. The report mentions the challenges that the south of Scotland faces and the need for it to learn from the experience of the Highlands and Islands—an argument that I have propounded for some years, as has the south of Scotland alliance, which the local authorities in the area, together with Scottish Enterprise in Dumfries and Galloway and the Scottish Borders, established to promote the interests of our region and raise its profile.

I disagree with Jeremy Purvis on the new Scottish Enterprise structure. Under the new structure, a south of Scotland organisational entity has been created that offers opportunities to the region. I wish the organisation well. However, a change of remit will be required if we are to replicate Highlands and Islands Enterprise in the south of Scotland. That is why the Labour Party included in its manifesto for last year's election a pledge to investigate whether the HIE model could be rolled out to other areas—the obvious area being the south of Scotland.

In our amendment, Labour is not being needlessly negative. We have genuine concerns that some of the Government's recent decisions might hold back or reverse the gains that were made under the previous Administration. I will highlight those that affect Dumfries and Galloway. Like other authorities throughout Scotland, Dumfries and Galloway Council is constrained by having to work in a tough financial environment. It agreed to freeze council tax, but—as far as I can see—next year it will receive some £20,000 less in aggregate external finance.

If Dumfries and Galloway Council struggles to make efficiency savings, the voluntary sector organisations that make such a crucial difference to rural communities will likely be first hit by any cuts. Indeed, for some organisations, funding through the former supporting people stream has already been cut by up to 50 per cent for 2008-09.

As of 1 April, Dumfries and Galloway Council will take on sole responsibility for local regeneration. However, at a meeting with the acting chief executive of Scottish Enterprise Dumfries and Galloway on Monday, I was advised that no staff will transfer from SEDG to the council to fulfil that function. In this difficult economic climate, Dumfries and Galloway Council will somehow have to find and recruit additional staff to enable it to take up that responsibility. If it does not, local economic regeneration impetus will be lost.

Moreover, there are concerns that local authorities are not being offered anything approaching the funding that they will need to undertake some of the regeneration projects that they will inherit. There are real fears about the fate of the Stranraer waterfront project in the Presiding Officer's constituency.

The Cabinet Secretary for Health and Wellbeing's recent decision on the review of health board funding is likely to cost NHS Dumfries and Galloway some £12 million per annum as funding for remote and rural locations is diminished. I understand that NHS Borders will fare worse, given that it is likely to lose £18 million. My constituents will suspect that their health services are losing money to fund the Government's decision to reverse accident and emergency closures in the central belt.

The week before last, an MSP made an unprecedented verbal attack on the town of Lockerbie, which is in my constituency. I am aware that the dereliction of town centres is a long-standing problem in Scotland, but of course I am upset that Lockerbie was singled out for attention by that MSP. I am also not too happy with the BBC's response on Sunday. In future, Scottish Enterprise will have no role in helping to regenerate town centres. I ask the Government to reconsider its approach to establishing a town centre regeneration fund that would lever in private investment to towns such as Lockerbie, Annan and Dumfries. I am sure that we will return to the subject. I hope that the Government will consider that proposal.

Photo of Rob Gibson Rob Gibson Scottish National Party 3:38 pm, 6th March 2008

In this debate we have to deal with the gap between remote rural areas and accessible rural areas. My membership of the Scottish Crofting Foundation is included in the register of members' interests. In my speech, I will concentrate on the Highlands and Islands, particularly on an issue that has been important to the Highlands and Islands for the past 40 or 50 years.

When the Highlands and Islands Development Board was established, it was said that the Highlands was on the conscience of every Scot. However, it was also said that if the HIDB did not solve the problems of the islands, the remote islands and remote Highland areas, it would not be a success—well, it did not.

There continues to be out-migration from the Highlands and Islands, which keeps the unemployment figures down. It is interesting to note that the latest unemployment figures for January show Wick at 3.3 per cent, Campbeltown at 3.3 per cent, Dunoon and Rothesay at 3.2 per cent, Uist and Barra at 2.8 per cent, Sutherland at 2.8 per cent, and Skye and Ullapool at 2.8 per cent. The figure for the northern isles is as low as 0.8 per cent, although they are a different kettle of fish—they have actually been able to adapt to the new world in which we live. The west coast and the islands off it must learn the lessons from the Highlands and Islands.

Given those figures for the long-term unemployed, someone must have a solution to deal with the situation. Will it come down to whether or not there is a crofter housing grant that is taken up by a large number of people? No—it will come down to making fundamental changes that were not effected in the last four to seven years. We will need to sort out a planning system that stops people living in the countryside. Sarah Boyack applauded the fact that many more people are living in Inverness. If she lived anywhere near there, she might realise that we cannot choose to live in the countryside within 30 miles of Inverness, because the planning system stops it. That is the planning system that we have inherited. It has to change.

Photo of Sarah Boyack Sarah Boyack Labour

If Rob Gibson thinks that the Planning etc (Scotland) Act 2006 is so bad, why did he support it and why has the Scottish National Party not come up with one suggestion for changing it? The matter is Highland Council's responsibility.

Photo of Rob Gibson Rob Gibson Scottish National Party

It is the responsibility of the Government and the Parliament. We supported the idea of a national planning framework for major projects. The whole of the rest of the planning system, as it affects house building, is a problem that has yet to be solved. The price that people must pay for housing in many parts of the Highlands is far higher than can be afforded with the incomes that are available. If it costs six times the average salary to buy a house, people who are worst off will be unable to do so. That includes people in the Western Isles, on the west coast and in the north of Sutherland—the very places with the highest unemployment.

Of the many inhibitors in the Highlands and Islands, I will mention one or two. It will not surprise members if I return to the subject of the Crown Estate. That body takes large amounts of money out of our area and gives virtually nothing back, except the occasional research paper. We need to remove the levies that harbours pay to the Crown Estate. The Parliament and the Government can do that. I hope that there is cross-party support for it. The rents that shellfish farmers pay to the Crown Estate have more than doubled in Orkney and have approximately quadrupled in Shetland over the past three years. The Crown Estate is sucking money out of areas that could be investing in themselves. We should stop that.

The OECD report discusses infrastructure. How should the Government deal with issues in remote and rural areas if the infrastructure, including trains—even trains to Inverness—has yet to be funded? Our inheritance from eight years of Labour-Liberal Democrat Government is that train services need to be funded in an even more difficult climate than before. What hope for the Transport, Infrastructure and Climate Change Committee's cross-party support for the far north rail line, which could open up the Pentland Firth and all the potential of the marine energy that will come from there? Steel and other materials will require to be carried by rail. Where are we going to get the money for that? The answer is that we will need to be a lot more innovative than we have been in the past.

The OECD report is set against the background that our incomes in Scotland are about 90 per cent of the average income for the European Union, which means that there will be no more structural funds. What happened in the past might have worked then, but it did not solve our problems. The OECD report points to how we must change our behaviour. We should recognise that the remote Highlands have a huge amount to contribute to this country, and we should spend on infrastructure and housing, in the hope that people will need to live there.

Photo of Peter Peacock Peter Peacock Labour 3:44 pm, 6th March 2008

When we discuss rural policy as a separate part of public policy, we tend to forget that rural dwellers have exactly the same objectives and ambitions as urban dwellers: they want high-quality education, high-quality health care, good jobs, good houses, and safe communities. Providing those in rural Scotland brings extra challenges for all public services because of our sparse population.

The OECD report is a useful analysis of what has happened in Scotland in recent years. In some ways it is optimistic, but it also highlights challenges. As ever, getting an external view on our affairs gives us a chance to reflect on, debate and renew our policy.

The OECD report challenges the notion—which we may have accepted in the past—that rural policy is a subset of agricultural policy, when it should be the other way round. In bald financial terms, agriculture is one small and decreasing part of the rural economy. Its significance is greater than its employment value because of its continuing role in food production and the custodianship of our landscape, but the agricultural lobby is only one part of rural Scottish life. Agriculture should not dominate decisions about rural policy.

In thinking about the future shape of rural policy, it might help to reflect on the lessons that we have learned from the past. Rural Forum Scotland, which existed a number of years ago, sadly collapsed. That effective organisation was an important force for rural policy, and I am sorry that it was lost to rural Scotland, because it gave rural Scotland a voice and encouraged debate and policy formulation among rural people and rural agencies. Notwithstanding the minister's comments about the body that he is appointing, organisations that are independent of Government provide benefits.

Since the demise of Rural Forum Scotland, the LEADER programme has developed locally throughout Scotland. The Scottish LEADER programme, which is widely regarded throughout Europe as a model of good practice, now falls under the rural development programme. Unfortunately, under that programme, LEADER has been underfunded and limited to a narrow range of measures. That mistake should be put right. I urge the Government to beef up the LEADER local action groups and allow them to make decisions on allocating resources across all axes of the rural development programme.

Despite the improvements in rural life, much of rural Scotland is still fragile, and there are huge challenges to overcome. One of the biggest challenges is accessible and affordable rural housing. Thankfully, the Rural Affairs and Environment Committee will look into that, so I will not dwell on it. There is the challenge of low wages, which is not confined to the most remote communities. For example, the constituency of Moray has some of the lowest wages in the country. Job opportunities are required and need to be expanded in many parts of the Highlands and Islands, despite the improvements that have been made in recent years. We still have some areas with significantly declining populations, which challenges their viability. Massive infrastructure improvements are also still necessary.

I regret the Government's response to those challenges. Let us take as an example Highlands and Islands Enterprise, to which others have referred. HIE has made a huge contribution to the renaissance in the fortunes of the Highlands and Islands in the past 40 years. It has invested in businesses and business support, in village halls and community capacity, in the arts and language, and in strengthening the voluntary sector. It is the envy of the rest of Scotland. The Government's response to that high-performing organisation has been to inflict the most savage budget cuts that the organisation has ever experienced. Never in 40 years have the Highlands and Islands seen such an attack on their development agency. HIE's budget and capacity have been reduced, it has lost some of its most experienced and skilled staff, and it has also lost the next generation of younger staff who could have been its future. If that is not bad enough, the Government is also removing key functions.

The damage is not confined to HIE. Highland Council is making more than £12 million of service cuts: library services are being cut, teachers are being offered early retirement, and janitors and cleaners are being sacked. Overall, more than 200 full-time equivalent jobs are to go across the council. As Sarah Boyack mentioned, there is a £1 million shortfall in the Argyll and Bute Council budget.

It gets worse. The minority SNP Government has changed the funding formula for health boards. As a result, Highland NHS Board's budget will reduce by £21 million a year in coming years and Western Isles NHS Board's budget will reduce by a massive 13 per cent. At the end of the phasing-in period, those two boards alone will be £30 million a year worse off. That is some demonstration of the Government's support for rural Scotland.

The RET pilot is neither RET nor a pilot. It benefits one part of rural Scotland at the expense of others. If someone can go to the Western Isles with a discount but not to Orkney, Shetland, Mull, Islay, Eigg, Muck, Rum or Canna, the policy is divisive and partisan, and favours one rural area over another.

I am sure that, if the OECD returns in three years' time, its report will say that not only could the Government do better, it must do better.

Photo of Alasdair Allan Alasdair Allan Scottish National Party 3:49 pm, 6th March 2008

Like other members, I welcome the OECD report and its many sound recommendations. In its opening gambit, the report states:

"Rural Scotland as a whole evidences good socio-economic indicators as compared to urban and intermediate areas".

I do not wish to gainsay that, but it must be pointed out that, as other members have recognised and as the report acknowledges, rural Scotland is no more homogeneous than is urban Scotland. If we categorised urban Scotland as either rich or poor, we would be dealing in some fairly serious generalisations. For instance, the report rightly points to the welcome economic growth and population increases that have occurred in the Highlands and Islands as a whole, but it also acknowledges, as members have mentioned, that such growth is far from uniform. The population decline in and economic fragility of areas such as the constituency that I represent are very real.

The growth in the rural population is welcome, but the report shows that areas of multiple deprivation in the Highlands and Islands coincide with the areas of greatest remoteness, not least among which are the island communities. It is no disrespect to either area to say that Harris is an economic world away from the commuter belt of Inverness. The reasons for that are not hard to find.

It will come as little surprise to members that, as far as I am concerned, transport policy is highly important in promoting economic growth in rural Scotland. As other members from remote and island constituencies will be aware, transport issues can pose difficulties for island communities and put a brake on economic growth. The OECD report makes it clear that Scotland's rural communities have immense economic potential. However, that potential, I contest, simply cannot be realised when it costs £350 to take a lorry one way across the Minch or when a tourist must be persuaded to part with £81 before he or she can take a car from Oban to Barra. At the moment, a company in my constituency spends more on exporting its product from Stornoway to Ullapool than on subsequently transporting it from Ullapool to Brussels.

I therefore welcome the fact that the Government has honoured its manifesto promise to pilot road equivalent tariff in the Western Isles, Coll and Tiree. I will leave Mr McNulty to assess and try to fathom his own reasoning—and taste—in comparing the RET policy to the policy of exterminating the Kurds. As far as I understand it, that is what he did this afternoon. If I am mistaken, perhaps he can explain where comical Ali comes in.

For some in the islands, the long wait for Labour to do something about the injustice of ferry costs has given RET a kind of unlikely, mythical status. Some wondered whether they would wait longer to see a ferry arrive from Ullapool offering RET tickets than they would to see one arrive from Tìr nan Òg. Some in the local Labour Party called RET the economics of the madhouse; others were recently heard to make rash promises about how they would welcome the day that the SNP delivered on its promise. However, the Government has delivered on its promise. I hope that the RET study will provide information on the kinds of benefits that, in time, I hope other islands will share.

Transport is not the only challenge that we face in rural Scotland, but the challenges as a direct consequence of transport links to the islands undoubtedly mean that, in the likes of the Western Isles, it is impossible to tackle other economic problems, such as housing and jobs. For that reason and many more, I welcome the report's findings and the fact that, at last, the Western Isles will be part of the national road network, with journeys priced accordingly.

Photo of Cathy Jamieson Cathy Jamieson Labour 3:54 pm, 6th March 2008

I welcome the opportunity to speak in this debate.

The Scottish Council for Voluntary Organisations briefing states:

"Thriving rural communities do not simply happen as a consequence of economic activity and land management. A successful rural strategy must address issues of rural community development, working with and building ... the social capital which bonds and animates communities."

I was therefore interested to hear the cabinet secretary refer to village halls, which are vital for our rural communities. It is important that local authorities do not see such resources as an easy cut when budgets are under pressure. I hope that, when he sums up, the cabinet secretary will be able to assure me that lowland rural communities will benefit from the funding allocation that was made available for village halls.

Rural schools are also important. The OECD report mentions education specifically, and highlights the fact that, to Scotland's credit, statistics show better performance in rural than in urban areas. That suggests that the challenge of delivering high-quality education in small and remote communities has been met. I draw that point to the attention of East Ayrshire Council in particular, which is proposing to close four small rural schools, and I ask South Ayrshire Council to take account of the OECD's comments in its consultation.

I would like the cabinet secretary to consider the innovative and imaginative proposal that has been made for the threatened Crossroads primary school in the East Ayrshire Council area. The proposal could be described as a new form of PPP—a parent-public partnership—and involves building a new school on land gifted by a local farming family, which would fund and build a biodigester to heat and power the building with renewable energy derived from cattle slurry. That would have the added environmental benefit of removing the risk that the local River Cessnock poses to groundwater.

As the OECD report makes clear—and as Peter Peacock indicated—rural policy is not just about agriculture. However, we must not forget that agriculture is a vital component of our rural communities, especially for those who work on the land. The work of the Scottish Agricultural Wages Board is vital in ensuring that such people receive a living wage. Anyone who visited the stall set up by Co-operative Development Scotland and who has seen the work of the Scottish Agricultural Organisation Society will know about the role and value of co-operatives in the rural economy, to which they contribute £1.3 billion in turnover.

This week, all members have received a briefing paper from First Milk, which is one of the biggest agricultural co-ops, with 2,600 members. Despite the fact that farmers have banded together and taken a co-operative approach, the price that they receive is still below what they need to cover their costs. We must examine such issues.

As Sarah Boyack outlined, the OECD report acknowledges what has been done well, but makes clear that there is more to do. In the future, a more flexible approach might be needed. The issues that face Muirkirk at one end of my constituency and Barrhill at the other have much in common, but the solutions might be different. A joined-up approach is needed. Sometimes, that does not happen at local level, even with the best will in the world and the best policies, and even if the necessary funding is in place.

I will cite a couple of examples. In January 2006, a £5.2 million freight facilities grant was awarded to take timber off the road in the south of Scotland, but for various reasons the project has not gone ahead. The timber is still being moved by road, rural roads are in a poor state of repair, and a local rail link has been downgraded. Will the cabinet secretary look into what has happened to that money? Can it be reallocated to ensure that rural south-west Scotland benefits from it?

A second example of the lack of a joined-up approach relates to my constituent Alex Paton, who runs a farming business and the We Hae Meat local butcher's shop in Girvan. He has an opportunity to expand, but is having difficulty getting suitable premises in the area or planning permission to expand his existing site. He has been told that sites are available in an urban area some miles away, but that would defeat the point of his trying to produce food locally and provide jobs in a rural area—not to mention the extra transportation costs that it would impose.

A number of members have mentioned the fact that the report calls for a rural organisation to be established in the south of Scotland. I support that proposal and hope that the cabinet secretary will give it due consideration. I understand that he will receive an invitation to attend a conference in Turnberry on 9 May that I will chair. I suggest that the conference will afford him an ideal opportunity to announce the establishment of just such an organisation.

Photo of Robin Harper Robin Harper Green 3:59 pm, 6th March 2008

The OECD report is a useful piece of research, but the Green party cannot agree with some elements of it. For example, the OECD complains that agricultural policy places too much emphasis on the environment. As the chamber can imagine, we do not share that view.

We are all too aware of the particular difficulties that Scotland's more remote communities experience. Just this week, 19 post offices across the Hebrides and the northern isles have been threatened with closure, and that process will continue unless it is understood that post offices are a vital public service to be paid for, rather than businesses to be closed if they make a loss.

We need support for local business incubators, and that is one of the reasons why I am in favour of the SNP motion. Although the motion does not say a lot, the last sentence says, in a sense, as much as we need with regard to the Government taking a bottom-up approach, which addresses one of the OECD's major criticisms. Local business incubators are very successful—80 to 90 per cent of businesses that take advantage of those facilities are likely to survive. Businesses that do not have access to local business incubators are more likely to fail—with a failure rate of about 50 per cent.

I believe that ministers take the concerns seriously, despite the rather complacent motion. I believe that the Conservative amendment will press them to do more—we welcome that amendment and will vote for it. In particular, we thank the Conservatives for not citing the OECD's environmental complaints.

I have the greatest respect for Sarah Boyack and the work that she has done, but I am sorry to say that the Labour amendment is devoid of content. Two things could happen: things could get—

Photo of Robin Harper Robin Harper Green

No, I am sorry. I will not take any interventions, as I have only four minutes—a minute has been chopped off my speech already.

The Labour amendment says that things could get worse, but they could also get better. The amendment is redundant.

The Lib Dems' amendment is more substantive, but we do not agree with their analysis—I presume that members will hear more about that from the minister—or with their top-down prescriptions. Unless the minister fails to provide sufficient reassurances—[Interruption.]

Photo of Robin Harper Robin Harper Green

I would like to finish what I am trying to say without sedentary interruptions.

Unless the minister fails to provide sufficient reassurance about the plans for affordable housing, I do not expect to back the amendment in the name of Mike Rumbles. I acknowledge that the lack of affordable housing in rural Scotland is a severe problem—that is of as much concern to Green members as it is to any other member in the Parliament.

We want support for local businesses, community-led innovation and decentralised energy production, and we want schools and hospitals to source local produce. In farming, we would like support for co-ops; the revival of the organic action plan—if the present Government would be so good as to do that; and the strengthening of land management contracts. In transport, we want re-regulation of rural transport; dualling of as much of the northern rail network as is financially possible over the next 10 years; and the closure of the loopholes that prevent communities from exercising their right to buy, so that they can take advantage of that right.

Photo of Jim Hume Jim Hume Liberal Democrat 4:03 pm, 6th March 2008

This debate has highlighted the potential of rural Scotland. Sarah Boyack clearly stated the achievements of the Liberal Democrat minister with responsibility for rural affairs in the previous two Administrations. The Cabinet Secretary for Rural Affairs and the Environment, Aileen Campbell, Elaine Murray, Jeremy Purvis and Cathy Jamieson all mentioned the South of Scotland region, and I am concerned that the report states that there is a particular problem with social exclusion in that region. I am sure that the Deputy Presiding Officer and the Minister for Environment—like me, they represent the South of Scotland—agree that that is an issue.

The debate identified several areas of concern in rural Scotland: transport infrastructure; the availability of affordable housing, which Mike Rumbles clearly stated as being an issue; economic diversification; and links between urban and rural settings. If those areas are developed in the right way, they will help to tackle social exclusion. It goes without saying that we should be aiming for sustainable economic diversification, whether through tourism, through supporting small businesses to expand, or simply by making the most of our countryside.

If pursued properly and in a balanced way, those activities would, in turn, create a sustainable environment for the vital communities that make up the fabric of the region. If rural areas were made economically attractive, people would be drawn into them and young people would be encouraged to stay in them. That would ensure a diverse population, which is particularly important. Depopulation and ageing are among the major threats to rural areas that are mentioned in the report and which have been mentioned in the debate—indeed, the cabinet secretary mentioned them.

Public transport infrastructure, which Rob Gibson mentioned, and affordable housing are key to sustaining a productive population. Only today, I opened a letter from a constituent who has been unable to obtain affordable housing. After months of trying all the local housing associations, he is now making plans to leave the town in which he and his partner grew up. They will take their skills elsewhere.

Public transport provision in Scotland is patchy, to say the least, and the situation in the south has again been highlighted. I look forward to hearing how the Government and the minister will address that problem in a rural context.

Robin Harper mentioned the environment. I was interested in Peter Peacock's views on the rural development programme. I have concerns. The report mentions the large funds that have been put into agri-environmental areas, but we are at the bottom of the European pile for funding. The situation was not helped by a certain Labour ex-Prime Minister bargaining funds away in 2005 from pillar 2 to the European Union general budget, at a cost to Scotland of £60 million, with nothing in return.

Regionalisation is heavily featured in the report as a more effective approach than centralising services. In light of the cabinet secretary's warm welcome for the report, his approach seems at odds with his Government's policy. I refer to two recent examples in that context: Scottish Enterprise, which many members have mentioned, and VisitScotland.

I was astounded to hear John Scott supporting Jeremy Purvis's stance on retaining funding for Scottish Enterprise Borders. In, I think, the very seat that John Scott is sitting in, the Tory party's Derek Brownlee welcomed the dismantling of the Scottish Enterprise structure. It is a little concerning to find out the Tories' views on that matter. I am disappointed that the cabinet secretary failed to promise specific Scottish Enterprise funds for the Borders region. Given what I have said and the report's emphasis on the development of small to medium-sized businesses, on support for that sector and on creating new economic opportunities in tourism, for example, I am worried about any move towards a policy of centralising services, which would be nothing more than folly.

Peter Peacock mentioned that Highlands and Islands Enterprise is the envy of Scotland. The report recommends that a south of Scotland forum be set up and that that forum should work in a similar way to the way in which Highlands and Islands Enterprise works. I could not agree more with that recommendation. How will the minister respond to it in summing up, given that the SNP seems to be focused on centralising vital services? I would welcome the minister's views on that.

Photo of Nanette Milne Nanette Milne Conservative 4:08 pm, 6th March 2008

I found the OECD review interesting. Many of its findings are in tune with what I have seen in Aberdeenshire in the past few years.

Much of rural Scotland continues to flourish, but it is clear from the review that rural Scotland looks nothing like it did 20 or 30 years ago. Changes in the population, the agricultural industry and the rural economy have brought new challenges. In Aberdeenshire, for example, there are significantly fewer farms now, the remaining farmers largely work unassisted, and farmers' wives are employed off the farms to supplement household income. The area is now home to many former city dwellers—many are from the south—who commute daily to Aberdeen and beyond. There has been a proliferation of small craft shops and farm shops with integral tearooms, which are dotted along the main roads, and other small visitor attractions that are designed to supplement people's dwindling agricultural incomes.

Overall, the review paints rural Scotland in a relatively positive light. However, it makes it clear that rural communities that are thriving are doing so in spite of, rather than because of, the Scottish Government. I agree with the cabinet secretary that all credit is due to the many community activists in our small towns and villages who are responsible for the successful communities that they work hard to sustain. However, rural policy is fragmented. Multiple agencies work on rural issues, but no one body focuses on a distinctive rural policy. The Government's approach to rural Scotland is seen as centralised, poorly integrated, top down and inflexible. It is thought that there is a serious lack of involvement at the grass-roots level. That must change if rural Scotland is to develop and thrive in the 21st century. I am pleased that the Government agrees with us that there must be significant pruning of the agencies that are involved in rural policy.

The areas of specific concern to rural communities are many and diverse, and we have heard about a number of them this afternoon. John Scott highlighted the fragility of agriculture in parts of rural Scotland and the current threat to sustainable food production. Sarah Boyack voiced concerns about connectivity between rural and urban communities, highlighting the concerns in the Borders about the railway. Aileen Campbell and Alasdair Allan talked about the burden of high fuel prices on our rural and island economies, and concerns were expressed by Elaine Murray, Peter Peacock and others about council and national health service funding decisions that would have an adverse impact on several remote and rural areas.

Of the seven key priorities for action that are mentioned in the review, the four that I would single out are education, housing, the creation of an environment that is supportive of small and medium-sized businesses, and energy.

I have visited many rural schools throughout Aberdeenshire and parts of Moray during my time as an MSP, and the educational experience of the young people whom I have met has been second to none. Sadly, I have also been involved in several campaigns to save such schools from closure. The threat of school closure continues to hang over many rural communities; I hope that the matter will be addressed. I welcome Murdo Fraser's proposed member's bill, which would introduce a presumption against the closure of rural schools. I hope that the Government will abide by its manifesto commitment to introduce just such a measure.

I will not try to emulate the critique of Government policy that was made by Mike Rumbles, although I agree with him that there is an acute lack of appropriate and affordable housing in many rural areas. Local people often have to compete with high earners from elsewhere for properties that become holiday homes that are seldom used. In addition, many councils rigorously apply land use regulations that prevent building in the countryside, allowing development only within existing settlements. For example, in my experience, permission is usually refused when a retired farmer applies to build a new home for his retirement in order to release the original farm house for a new entrant to farming. I and my colleagues have been concerned about that for a long time—in fact, our manifesto for last May's elections mentioned it.

Although all developments must be sensitive to greenbelt considerations, there is a need to move towards a more flexible approach where that is appropriate. Like many other Scottish rural areas, Aberdeenshire is home to many small and medium-sized businesses, which are the backbone of the rural economy. They will welcome the Government's decision to fast track the promised cut in business rates—a decision that would not have been made if the Scottish Conservatives had not forced it on ministers. However, action is still urgently needed to improve water services and to cut the red tape that is strangling so many small enterprises.

We note the review's statement that it should be possible to expand the use of wind energy through the careful siting of wind farms and transmission lines as well as appropriate use of undersea and underground lines. That vindicates our championing of a moratorium on locally opposed wind farms pending a comprehensive renewables strategy. Inappropriately sited wind farms can cause damage to biodiversity, tourism and quality of life.

The OECD review is a welcome and timely contribution that makes it clear that the Government's approach to rural policy needs to change. There must be a move to a system that actively involves local people in planning for their future. If our rural communities are to be prosperous and sustainable in the long term, we must understand the importance to the rural economy of tourism, public services and diversification. A prosperous and sustainable future can be achieved only if concentrated efforts are made to engage with rural interests. That is why the Government must not hesitate in acting on the findings of the review.

Photo of Karen Gillon Karen Gillon Labour 4:14 pm, 6th March 2008

I welcome the opportunity to participate in this important debate about future policy for rural Scotland. The range and quality of the debate shows the commitment of members across the chamber to rural Scotland.

I wondered why Mike Russell sidled up to Robin Harper during earlier speeches. However, during Robin Harper's speech, it became abundantly clear that the Scottish Green Party has become a wholly owned subsidiary of the SNP—although it does not seem to be getting anything out of that, if the list of policy priorities that Robin Harper outlined is anything to go by. The Government has simply left behind the organic aid fund and the land use fund—to name but two.

Photo of Robin Harper Robin Harper Green

All those Green party policies were in our manifesto and it was appropriate for me to mention them during the debate.

Photo of Karen Gillon Karen Gillon Labour

Robin Harper misses the point. The funds that I mentioned might have been in the Green manifesto, and they were in place previously, but they have been cut by the Government that he seeks to support day in, day out.

Sometimes, and quite wrongly, a view persists that rural Scotland is just the Highlands and Islands. Although they are key areas in today's debate, so are many of the other areas that make up rural Scotland. I was brought up in Jedburgh in the Borders, a town whose educational attainment and health indicators are lower than average, and which has suffered from the decline of the knitwear industry. The town is now looking for a way forward. I know people who will be disappointed that yesterday the Government withdrew direct funding for the Borders rail link, leaving its future to the vagaries of financial markets that are themselves facing challenges. The withdrawal of £115 million in direct funding is a cut for the Borders. It means a lack of certainty for the project and it is bad news for economic development in that part of Scotland.

I have the privilege of representing Clydesdale, which is another important part of the south of Scotland. Recently, there have been significant improvements in the area. In transport, we delivered the new rail link to Larkhall, doubled rail services from Lanark to Glasgow and started a twice-daily service from Edinburgh to Carluke. In education, the Labour-led South Lanarkshire Council has had for many years a policy of no school closures—just like the one that Nanette Milne advocated. It also has a commitment to an ambitious primary and secondary school estate programme that includes those rural schools.

The town centres in Lanark, Carluke, Biggar and Larkhall are undergoing regeneration, and further work is being done in Forth, Lesmahagow and Kirkmuirhill. A dedicated rural task force has been established, which is another positive step forward. Progress has been made.

Like others, I was struck by the OECD report's comments about the south of Scotland; unlike others, however, I do not believe that the report should be considered as special pleading. There is considerable merit in the suggestion that a south of Scotland model similar to HIE should be established, and I am interested to learn how ministers believe that that can be progressed positively in the months ahead, so that we can take the south of Scotland forward.

The report indicates that social exclusion is a huge issue for the south of Scotland. It is a very serious issue, on which further work and research need to be undertaken so that we can fully understand the reasons for social exclusion, and so that distinct solutions can be found that can specifically target the needs of the area. Again, I am interested to hear how the minister believes that we can take that work forward.

I want to focus on a few other issues on which I would welcome the minister's comments. The first is that of is water rates and the consultation that is taking place on the extension of the exemption from charges for churches and voluntary organisations. In rural Scotland, churches, charities and voluntary organisations are disproportionate in number when compared with the number in urban Scotland, so failure to implement a further extension to the exemption would have a disproportionate effect on rural Scotland. In many places in rural Scotland, the church is the only local public building apart from the school, and if the exemption is not extended, there might be real problems for many of our rural communities. Churches might not be able to continue to provide services for their local communities. A similar case can be made for voluntary and charitable organisations. I hope that the Government will consider the consultation and provide a positive way forward for those bodies.

The second issue is that of town centre regeneration funding, which my colleague Elaine Murray mentioned. A solution to the problem can be found. Although Conservative members welcome the abolition of business rates, it remains to be seen whether that will lead to the upgrading and development of our village and town centres. Something must be done to provide the impetus for that regeneration. Perhaps the minister could comment on that today, or perhaps he could come back to the chamber with comments on how such regeneration in rural Scotland can be developed.

The third issue is that of the changes in the funding formula for the health service, which will bring about cuts. Members have mentioned those changes, but the report mentions consideration of the use of decentralised health skills and facilities to provide diagnosis, training and other health services. Although the SNP Government's decision on A and E services at Monklands hospital has been welcomed by people in the Monklands area, there is a direct consequence for people in Clydesdale, as a minor injuries clinic to provide local services will not now be introduced. That is regrettable, so I hope that the Cabinet Secretary for Health and Wellbeing will work with NHS Lanarkshire to tackle the issue. I believe that the move is a retrograde step for people in Clydesdale, because the clinic would have been an appropriate use of remote health services to deliver diagnostic services in the community, thereby cutting down on travelling time for people, reducing inconvenience and making health services local.

The final issue that I will mention is the de-ring fencing of the rural transport fund and how the Government will monitor that. Members throughout the Parliament have councillors whom we trust but who will be under considerable pressure to provide many services in the coming year. How will the Government monitor how local authorities spend the money that has been disaggregated, to ensure that services that were delivered previously through the rural transport fund continue to be delivered and developed? We talk about connectivity. Bus services in many parts of rural Scotland, including mine, are often the only form of public transport, so it is essential that they continue to be developed.

The debate has been important. I am happy to support the Conservative and Liberal Democrat amendments.

Photo of Michael Russell Michael Russell Scottish National Party 4:22 pm, 6th March 2008

On the whole, the debate has been positive. Several important comments have been made that set the context. I agree with Karen Gillon and other members that the debate is not about north or south; some of the most interesting and important points in the report are about Dumfriesshire and the work that the OECD team did in considering the issues in the south of Scotland, but other points relate to the north. Even more wisely, Dr Alasdair Allan—who is a well-trained person, because he once worked as my assistant—made the most important point of all. We cannot take a homogeneous approach to rural Scotland, just as we cannot take such an approach to urban Scotland. His point that it is untrue to talk about urban Scotland as one block doing well or being rich applies similarly to rural Scotland. Parts of rural Scotland are doing well, but parts are not doing so well.

The key point in the OECD report is that the policy has broadly worked, in that it has led to progress in rural Scotland. Last night, I had dinner with one of the OECD team. I was interested to learn from him that, when he is asked by rural experts throughout the world where interesting things are happening, Scotland is one of the countries that he gives in evidence. Interesting innovations are taking place in Scotland. I pay tribute to the previous Administration and to Administrations before that, because the development of the ideas has taken time. The obligation on the Government is to continue to make progress and to bring new ideas to the table if we can, informed by the OECD report.

That is a challenge, but it might be easier if we got a bit more credit for the work that we are doing. My friend Richard Lochhead's motion pays tribute to the previous Administration, as I have just done; alas, I did not hear Labour or Liberal Democrat members say a single word about items being carried forward and built on, which is a pity.

I pay tribute to the OECD using the words of Robert Burns. The report has helped us by giving us the power that Burns mentioned when he wrote:

"O wad some Pow'r the giftie gie us

To see oursels as others see us!

It wad frae monie a blunder free us

An' foolish notion".

We have heard some blunders and foolish notions during the debate. I will come to the great chieftain of the foolish notion, Mike Rumbles—[Interruption]—there he is, and I will come to him shortly.

Labour members made good speeches, so I regret that they made points that cannot go unchallenged, the most important of which were about centralisation. The OECD report talks about decentralisation, but Sarah Boyack wants the Government to decide how many home helps there are in Haddington and Karen Gillon wants us to decide how many buses run to Biggar. The outcome agreements will monitor the situation, but the days of micromanagement are over.

I regret that there was scaremongering about other issues. Members who talked about the Borders railway were disgraceful. The difference between this Government and the previous Government is that the previous Government did not make the Borders railway happen, but we are making it happen. It is wrong to suggest otherwise.

Scaremongering in the chamber does rural Scotland no good. The OECD report refers to the positive, can-do attitude that we need. We do not need the negative, carping attitude that we heard from members of Opposition parties, with the exception of John Scott and Nanette Milne, who asked us to pay attention to issues that are raised in the report. We will pay attention to such issues.

I will respond to two more issues about which members were scaremongering. The moneys for the LEADER programme are being increased, not decreased—the facts are there. What perhaps annoyed me most was the scaremongering on rural school closures. Throughout my career I have fought for rural schools, for a personal reason—I am sure that members know that my wife is a primary head teacher and has been involved in a rural school closure—and because I acknowledge the virtue of rural schools. To hear from the former Minister for Education and Young People, who did not turn down a single closure proposal, that suddenly we are to have a presumption against closure—

Photo of Cathy Jamieson Cathy Jamieson Labour

Will Mr Russell describe the circumstances in which I agreed to closures in the Dumfries and Galloway area, of which he should be aware?

Photo of Michael Russell Michael Russell Scottish National Party

I repeat what I said. There should be a presumption against closures and the Executive is considering the matter. I am glad that members have changed their minds on rural school closures, but they should not preach to me about the issue.

I turn to the other side of the Opposition group—Mr Rumbles. It is a relief to see that Mr Rumbles has lasted the whole debate without walking out. That is delightful, although I would not have regretted it if he had walked out. Also, unlike most Liberal Democrats, he has not resigned in the past hour and a half. However, he has moved into a parallel universe. On planet Lib Dem, the SNP has been in power for the past three generations and has failed to do anything about anything, so Mr Rumbles must tell the SNP what it should do. The reality is that the housing crisis in rural Scotland grew out of all proportion under a Labour-Lib Dem Administration. The Government is moving to do things about that.

I give two examples. First, we are doing immensely important work through the rural housing task force. However, what we heard about the croft house grants scheme was entirely wrong. The fund was underspent; the figures for it for this year are net of receipts, which has not happened before; and the Shucksmith committee of inquiry on crofting is examining croft house grants and how we can develop the fund's use. Mike Rumbles lodged an amendment that is factually incorrect, which was irresponsible.

Secondly, there was an attack on my friend Mr Lochhead about the figures for rural development that have been given. I quote from a letter that the Rural Affairs and Environment Committee received—perhaps Mr Rumbles walked out before the committee considered it—which says, in relation to spending on rural development:

"resources at the disposal of the Scottish Government rise from £174.3m this year to £202.4/£210.4/£212.4m over the Spending Review. This is a real terms increase of 12.6%".

I hope that Mr Rumbles will do the right thing and apologise for what he said.

Photo of Michael Russell Michael Russell Scottish National Party

He might well walk out. Perhaps that is how Lib Dems apologise.

The challenge for rural Scotland is to continue to develop our policies and to make a success of them. This Government is committed to doing that and will go on doing that. I would like to think that the other parties in the Parliament will join in that activity and ensure that rural Scotland succeeds.

Some speeches helped in that regard, but some were negative and carping. Rural Scotland will not flourish if all it gets is party-political bickering; it will, however, flourish if the right policies can be applied.

Members should support our motion, which praises our predecessors, and the Conservative amendment, which encourages us to try harder. The other amendments are, unfortunately, mere carping—and mere carping is not enough.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

On a point of order, Presiding Officer. I am concerned that the minister might have inadvertently misled the chamber. Members of the Rural Affairs and Environment Committee can vouch for the fact that his own head of the environment department has written to the committee, saying that over the next three years there will be a 6.5 per cent cut in real terms in the rural development budget. Presiding Officer, will you ask the minister to reflect on that and, if he has misled Parliament, to come back at the earliest opportunity to put the record straight?