There was widespread concern in April when the Scottish Government suddenly announced the extension of First ScotRail's contract to 2014. There was no consultation with passengers or with the workforce or with trade unions. Indeed, there was no consultation with anyone at all. Audit Scotland was scheduled to review the operation of the franchise, but ministers could not be bothered waiting for that either. Last week, Audit Scotland produced its report, which raised concerns and led to the resignation of a senior Transport Scotland official. Why did the First Minister fail to consult on the franchise review and on the extension options? Why did he not wait for Audit Scotland's report?
That is what the heading of paragraph 57 says.
"Transport Scotland's management arrangements are generally effective", says the heading above paragraph 27.
"First ScotRail's performance to date has been good, and continues to improve", says page 24 of the report.
I would quarrel with one thing Iain Gray said in his introductory question: he said that the extension to the contract was unexpected, a surprise. I have looked back over the history of the contract. On 5 December 2002, the answer to a parliamentary question announced both the franchise length and the possibility of a three-year contract extension. That parliamentary question was answered by one Iain Gray.
That is true. And I remember the lengthy consultation process we went through to award the franchise.
The Audit Scotland report says positive things
"The lack of consultation created practical difficulties."
Those practical difficulties will cost the taxpayer £1.5 million for closed-circuit television cameras in Strathclyde stations because the Minister for Transport, Infrastructure and Climate Change did not bother to ask where that money would be found between 2011 and 2014. Clearly, Audit Scotland believes that there may be other financial holes that will also need to be filled.
Will the First Minister admit that the failure to consult key stakeholders in advance was a serious and costly omission?
The Audit Scotland report sets out governance issues, which Transport Scotland will take on board and improve upon, but that does not deflect from the £73.1 million of investment that is identified in the report. Nor does it tell us why the matter was such a big surprise to Iain Gray, who six years previously opened up the possibility of a three-year extension.
The contract involves £2.5 billion of taxpayers' money. The 215,000 passengers a day who depend on the service have just seen their fares soar. The contract was extended with no consultation, no assessment criteria and—most damning of all—no business case. Audit Scotland states:
"Transport Scotland did not provide the Minister for Transport, Infrastructure and Climate Change with a fully documented business case, taking the view that presentations to the minister were more appropriate."
That is public spending by PowerPoint. Perhaps the Minister for Transport, Infrastructure and Climate Change did not feel the need for a business case, but did the Cabinet Secretary for Finance and Sustainable Growth not ask to see one? Did the First Minister not ask to see a business case? Did no one in the cabinet ask what the business case was? Did the First Minister sign off the decision? If he did, on what basis did he do that?
On the basis that it would provide improvements for rail passengers and railway workers in Scotland.
I noticed that Iain Gray slipped in a remark that indicated that he does not like the fare increases. No one likes fare increases, whether they are rail passengers or anyone else, but as far as I understand his questions Iain Gray is not challenging the real benefits that Audit Scotland identified the three-year extension will bring in the way of investment in and improvements to passenger services.
Fares will increase by 6 per cent from 2 January, which means that the average Scottish fare will be £2.65. In the United Kingdom, it is £4.60. Other operators have similar average fares. Chiltern Railways' average fare increase is 7.5 per cent, First Capital Connect's is 9 per cent and CrossCountry's is 11 per cent. No one likes fare increases, but will Iain Gray acknowledge that the investment pattern, the additional millions of pounds that are coming into our railways and the fare structure look a lot better in Scotland than they do elsewhere?
I am challenging an approach to government that too often poses too many questions about the way in which the Government goes about its business. What about the First Minister's cack-handed intervention in the Trump affair, or five ministers involving themselves in a planning application in Aviemore? What about the headlines alleging cronyism when it comes to handing out grants? And now we find that a multi-billion pound contract has no business case and a conflict of interest at its heart. There are too many questions and no answers. The Government clearly believes that the normal rules of transparency and good governance do not apply. It clearly believes that a nod and a wink will do, but it will not.
Of course. I am the first First Minister ever to appear before a committee. As far as the Trump affair is concerned, if it had been left to the Labour Party we can be absolutely certain that that investment would not have come to Scotland.
As far as procedures are concerned, at no stage in his line of questioning has Iain Gray challenged the real benefits identified by Audit Scotland for passengers and rail travellers in Scotland. That is important because the performance of Scotland's railways and the investment being made in Network Rail are some of the few areas in Scottish life that are protected from the £500 million of cuts that the Westminster Government is making.