Tackling Inequalities

– in the Scottish Parliament on 20th January 2015.

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Photo of Tricia Marwick Tricia Marwick None

The next item of business is a debate on motion S4M-12095, in the name of Alex Neil, on tackling inequalities.

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

As members will know, over the past six years we have seen many changes in Scotland’s labour market. There has been a marked increase in part-time work and an increase in self-employment, and many employers have taken the opportunity to introduce new ways of contracting with employees—hence the rise in zero-hours and fixed-term contracts. At the same time, and probably as a direct consequence of those changes, underemployment is widespread and real wages have fallen.

The new ways of working are gradually eroding employment protections that have been built up over many decades. As bad as it is when any business goes under, it is even worse when many people who depend on that business for their livelihoods find that they have no recourse to any of the legal protections that might once have been available.

Real wages have fallen, as I said. There is now a substantial and measurable problem of in-work poverty, which is getting worse. The Joseph Rowntree Foundation has just published a report on the subject; this morning, the Scottish Government published evidence on the extent of in-work poverty in Scotland.

The people who are most likely to receive low pay are women, young people, older workers, people without qualifications, some ethnic minorities, lone parents and disabled people. Women are more likely to work in low-paying sectors and are more likely to be in part-time employment, which has a substantial overlap with low pay.

That means that even though employment levels have grown significantly since 2008, job quality—measured in terms of remuneration, job security, fair contractual terms and opportunities for progression and engagement—is poor for a growing proportion of people in employment. There is an increased sense of disconnection between business success and the accrual to employees of a share of the benefits of success.

This Government is absolutely of the view that such changes are bad for the economy. Inequality is holding back the life chances of the lowest earners in Scotland’s population and acts as a significant brake on productivity and growth.

The latest evidence from the Organisation for Economic Co-operation and Development suggests that income inequality has a significant negative impact on growth. Policies to reduce income inequalities should be pursued, not only to improve social outcomes but to sustain long-term growth.

We published a revised child poverty strategy in March, which included outcomes that focus on the three Ps: pockets, prospects and places. We aim to maximise household incomes, improve children’s life chances and provide sustainable places. The strategy includes actions across a variety of areas.

The approach in the strategy is reflected in the commitments that the First Minister made in the programme for government. The programme sets out a range of cross-portfolio policies that are aimed at reducing inequality, including action around fair work, which is part of the focus of this debate, such as our commitment to pay the living wage and the increased funding to the Poverty Alliance to grow the number of accredited living wage employers.

The programme also sets out a focus on school attainment and university access for people from disadvantaged backgrounds, which is being taken forward by my colleague the Cabinet Secretary for Education and Lifelong Learning. There are also commitments to support increased childcare and free school meals, which have been the subject of recent discussion. The policies are designed to help to reduce intergenerational poverty and tackle inequality.

Photo of Neil Findlay Neil Findlay Labour

Which of those or other policies takes money from the wealthiest in our society and puts it into the pockets of the least wealthy, and is under the control of the Scottish Government?

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

The member’s final phrase is key. What would actually help us to do something about that is precisely what the Labour Party does not want us to have—that is, powers over tax, benefits and employment law.

The programme for government also emphasises our commitments to empower communities by handing over decisions on key issues and to make Government open and accessible, through public participation in the decisions that we make that affect communities.

We have committed to poverty proofing all our new policies and legislation through the use of poverty impact assessments whenever we make a change.

We will appoint an independent adviser on poverty and inequality, who will hold public events with the First Minister to raise awareness of the reality of living in poverty, make recommendations to the Government on how collectively we should respond and hold the Government to account on its performance.

However, we know that poverty levels are increasing in Scotland because of United Kingdom Government policies. Scottish Government analysis estimates that the price that Scotland has had to pay as a result of the UK Government’s cuts and changes to the welfare system could total around £6 billion in the six years to 2015-16.

One of the depressing outcomes has been the massive rise in the number of people who are using food banks. It is clearly unacceptable that so many people in Scotland are living in food poverty. We continue to make that point to UK ministers as we press them on the impacts that their decisions on welfare are having in Scotland.

I have mentioned the rise in in-work poverty. It is an absolute scandal that the majority of working-age adults in poverty in Scotland—indeed, throughout the UK—are living in households in which at least one adult is in employment. For children, the figure is 59 per cent. We have made various commitments to what we call the social wage, which extends certain core universal services, rights and benefits in order to deliver the social and economic circumstances from which everyone will benefit. I will not rehearse them all here, as the chamber is well aware of them. I will, instead, focus specifically on some of the areas that fall within my portfolio, the first of which is the living wage.

All our policies in reference to the social wage—for example, free school meals—are designed to help hard-pressed families and individuals, as are our commitments on the living wage. Despite the sharp reductions that have been imposed on the Scottish budget by the UK Government, we have managed to incorporate a number of distinct measures in our pay policy to actively protect the pay of our lowest-earning public sector workers, including a commitment to support the Scottish living wage for the duration of this parliamentary session, to 2015-16.

As I have said, we have also provided further funding to the Poverty Alliance to promote take-up of the living wage accreditation scheme. We have set a target of having at least 150 accredited employers by the end of 2015, and some members may have picked up the fact that, yesterday, the First Minister visited the 100th such employer to be signed up. That will help to increase the number of employers who are paying the living wage in all sectors in Scotland and to make decent pay the standard in our country.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I welcome the minister’s comments. Does the minister have any views on the need to tackle, as well as pay at the bottom, excess pay at the top?

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

The minister has a great many views about the need to tackle excess pay at the top; it is just a pity that the party to which the member belongs does not appear to have much to say about it. It is a great pity that the party opposite is not interested in giving this Parliament the powers to do something in a statutory sense about all the issues that we are raising today.

European Union law prevents the payment of the living wage being mandated as part of a public procurement exercise. Despite others’ claims to the contrary, the position under EU law has been made clear in a number of rulings of the European Court of Justice and in correspondence between the Scottish Government and the European Commission. Making the living wage mandatory through contracts is not possible under EU law where the statutory national minimum wage has been set at a lower level. That is why the SNP Government asked the Smith commission to recommend devolving responsibility for the national minimum wage to the Scottish Parliament—a policy that the Labour Party chose not to support. Labour members refused to support the devolution of responsibility for the national minimum wage to Scotland, a move that would have allowed the Scottish Parliament to determine what level it should be set at.

We have consistently explained that, although we cannot make the living wage mandatory, we can strongly encourage it. That is what the Procurement Reform (Scotland) Act 2014 seeks to do in providing for the issuing of statutory guidance on workforce matters in procurement. My colleague Keith Brown, the Cabinet Secretary for Infrastructure, Investment and Cities, is currently consulting key stakeholders, including the Infrastructure and Capital Investment Committee, the Scottish Trades Union Congress, trade unions and the Poverty Alliance, on draft guidelines for purchasers on how to tackle workforce matters in procurement.

We are also leading by example. The Scottish Government successfully encouraged bidders to offer bids that were based on their staff being paid the living wage when we recently tendered our catering contract. In addition, we have worked with our existing cleaning contractor to ensure that its staff who work on our core premises will also receive at least the living wage. We continue to encourage all public bodies and businesses to follow our lead on this important matter.

To expand on some of the issues on the broader question of fair work, I am glad that this Parliament showed overwhelming support for the working together review and its recommendations when first debated on 13 November last year.

We are always focused on securing the best outcomes for Scotland. We believe—the working together review confirmed this—that progressive workplace policies can help to improve a firm’s productivity and innovation and can aid sustainable growth. Well-rewarded and sustained employment is the best route out of poverty and the best way to tackle inequality. That is why there will be a fair work convention; that is why it will prioritise the promotion of the living wage to highlight the fact that business productivity goes hand in hand with decent, fair and equal pay.

In support of our approach that fairness supports and underpins long-term prosperity, we will develop a Scottish business pledge. It will invite companies to commit, for example, to extending the living wage, involving their local communities, and investing in youth training and employment and, in return, they will be offered a package of tailored support on skills, innovation and exports, to help them to grow and prosper.

Against the background of recession and continued Westminster austerity, our strategy for developing Scotland’s young workforce is delivering. Recent employment statistics for Scotland have been encouraging—we have record numbers of people in work. Youth unemployment in Scotland is at a five-year low. I expect people to really welcome that. Scotland is outperforming the United Kingdom as a whole on youth unemployment, employment and youth inactivity rates.

We still have more to do. We want to tackle long-term issues in the labour market and barriers to young women and men getting into jobs. Last year, we said that we would be able to increase the annual number of new modern apprenticeship starts, taking the number to 30,000 a year by 2020. We have set ambitious targets for our young workforce. The Parliament will recall that, in December 2014, I brought to the chamber “Developing the Young Workforce—Scotland’s Youth Employment Strategy”, which set out an ambitious seven-year programme on which we will report regularly.

The key performance indicators in the strategy cover a range of measures and have a particular focus on addressing inequality. They look to increase the minority gender share in the largest and most imbalanced college superclasses, increase the employment rate for young disabled people to the population average and increase the number of modern apprenticeships starts from minority ethnic communities. We will report each year on those ambitions. Implementing the programme will put us where we belong—among the best-performing countries in Europe.

Above all, our seven-year programme will be a collaborative effort. Government cannot do this on its own, so our programme has been developed in conjunction with our partners in local government and with Scotland’s employers and trade unions.

We all have a part to play in developing a fairer and more equal Scotland and, frankly, we must work together if we are to do so. I am sure that those present would agree that the issues motivate us all and that this Parliament, like the Scottish Government, must continue to make strong commitments to tackle them. We need to work together here as well as out in the country if we are going to achieve what we want to achieve, as set out in the motion before you.

I move,

That the Parliament agrees that a strong, sustainable economy is essential to building a fair and wealthy society; further agrees that a society that is fair and equitable underpins a strong economy; believes that an essential element of this is that work should be a route out of poverty; deplores the fact that half of children in poverty are growing up in a household where at least one person is in employment; further believes that this is a clear sign that the economic and social policies of the UK Government are failing Scotland; notes the commitment of the Scottish Government to build a fairer Scotland and tackle inequality; welcomes the positive steps that the Scottish Government has taken toward this by paying the living wage as part of its pay policy and, by supporting living wage accreditation, encouraging more organisations to do the same; further welcomes the development of the Fair Work Convention to promote and sustain a fair employment framework, and is concerned that these efforts are at risk of being undermined by the £6 billion of welfare cuts being made by the UK Government.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I congratulate the cabinet secretary on introducing today’s motion on tackling inequalities, and particularly on her timing. Many of us will have heard this week’s news from Oxfam that the richest 1 per cent of the world’s population is on the brink of owning more wealth than the rest of us put together. One per cent of the population own half of all global wealth—that is obscene; that is immoral. What is worse is that that is damaging to our economy, to our society and to the values that should bind us together.

What I find particularly worrying is not just the levels of extreme inequality, but the fact that the problem is getting worse and the inequality gap is continuing to widen. As most families have struggled through the past half dozen years of recession, frozen wages and rising prices, the number of billionaires has doubled. That is positively dangerous—it is so unfair that it is difficult to imagine that it will not breed resentment. In terms of our responsibilities and record as members of the Scottish Parliament, it is a poor reflection on our political structures, our public policies and our democratic accountability that we have allowed such inequality to develop.

The good news is that there are strong signs that the world has woken up to inequality. I know that many members in the chamber, for example, have quoted from the seminal book “The Spirit Level: Why Equality is Better for Everyone”. Oxfam is just one of the many organisations that are leading the way in challenging that threat to our way of life with its even it up campaign. In turn, it quotes supporters as diverse as Pope Francis and the International Monetary Fund.

The Scottish Government has woken up, too. I am pleased that it lodged the motion, but I am also slightly anxious. I am worried that the cabinet secretary believes that such a complex problem can simply be blamed on the UK Government and that everything that we do in Scotland is beneficial. I share her belief that Tory austerity and welfare reform policies are making matters worse, not better, but we—by which I mean all of us in the Scottish Parliament—must accept responsibility for the decisions that we take, too.

The educational attainment gap is widening, but responsibility for our schools, colleges and universities has been entirely devolved to the Scottish Parliament for the past 16 years. Progress on narrowing health inequalities has stagnated—in some cases, the situation is getting worse—but health has been entirely devolved to the Scottish Parliament for the past 16 years.

Photo of Mark McDonald Mark McDonald Scottish National Party

I accept the points that the member raises, but is he not also aware that much of the evidence that has been received on those issues suggests that, at the point at which a child arrives at the school gate or an individual arrives at their general practitioner, the inequalities that affect their educational attainment or health have often already taken hold and that, by that time, it is a matter of managing a situation rather than tackling it?

Photo of Kenneth Macintosh Kenneth Macintosh Labour

The member makes a good point about the impact of socioeconomic backgrounds, to which I will come. However, the logic of his argument is a logic of despair. He suggests that we cannot tackle health inequalities using health policies, and I simply do not agree with that. I simply do not agree that we make no difference through the educational and health policies that we decide in the Scottish Parliament.

Mark McDonald rose—

I will give way in a minute.

The Scottish Government has received Labour support and will continue to have our support in pursuing policies that are fair, but Scottish National Party ministers too often confuse the pursuit of equity with the goal of tackling inequality. Free university tuition is just one example in that context. Scottish Labour supports that policy because it is equitable, but unless it is accompanied by action to widen access to Scots from all backgrounds, it will do little to reduce inequality. Unfortunately, the SNP’s record on widening access is worse than that of the Tory Government in England, despite its horrendous fees.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

In a minute.

In fact, the evidence clearly reveals that Scots from less well-off backgrounds are more likely to go to college than university. Therefore, we are not only not opening the door to higher education; ministers in Edinburgh have actually slammed the door shut to further education for more than 140,000 Scots.

We all know that education, skills and training provide among the best routes out of poverty and among the best ways to tackle social mobility and overcome inequality, but if a person in Scotland has to be middle class to access higher education in the first place, we are not reducing inequality; we are actually preserving it.

Photo of Angela Constance Angela Constance Scottish National Party

Does Mr Macintosh accept that statistics show that there is a 40 per cent increase in young people from disadvantaged backgrounds going into higher education? In the spirit of unity, does he also accept that there is, of course, a need for much more to be done, which is why a main feature of the programme for government was to set up the commission for widening access, which will be announced in a few weeks’ time?

Photo of Kenneth Macintosh Kenneth Macintosh Labour

Again, I do not doubt the cabinet secretary’s good intentions or her desire to tackle the area, but the worrying fact is that the most vulnerable people in our society were among the biggest victims of the Scottish Government’s decision making. Those with supported places at college or university suffered the biggest cuts when the education reforms went through in the past few years. Unfortunately, that is a sad reflection—

Photo of Kenneth Macintosh Kenneth Macintosh Labour

No, not at the moment. I will make some progress.

Even if we put education and health to one side for a moment, follow Mr McDonald’s point and take an entirely economic determinist view of inequality, there is still much that we could do in the Scottish Parliament. For example, the cabinet secretary rightly highlights the importance of wages, but the Scottish Government seems to want to go only halfway with its support for the living wage. We are delighted that the cabinet secretary has partly adopted yet another Labour Party policy. [Interruption.] I am glad that the SNP is coming round to our way of thinking on that issue and on many other issues. However, I do not understand—perhaps the cabinet secretary can explain—why the Scottish Government does not insist that any company that enjoys a public sector contract should have an obligation to pay staff the living wage.

Why does the cabinet secretary not support wage differentials? I asked her that straightforward question, and she was slightly touchy about it. The living wage will lift people out of poverty and help to make work pay. However, if top salaries increase faster, as they have done, the inequality gap will widen, not narrow. The cabinet secretary might believe that the issue that we are discussing is one only for FTSE 100 companies but, as it happens, the Equality Trust has worked out that none of the largest companies that are bidding for public sector contracts in the UK pays their chief executive less than 59 times UK median earnings.

Even more directly, we are rightly proud of our universities yet, although they are among the worst offenders with regard to employing people on zero-hours contracts, they are also guilty of paying university principals salaries of £250,000 or more. We are talking about taxpayers’ money. Do the ministers not see the contradiction in voting through a series of consecutive wage freezes or capped 1 per cent rises for those who are lower down the public sector while allowing such increases for those at the top?

I repeat, once more, that we are not saying that everything that the SNP does is wrong. Far from it. We have common ground in many areas. However, we cannot blind ourselves to the difference that we could make here in the Scottish Parliament. There are many contributions that we could make. With regard to education, investment in the early years is the most likely piece of investment to pay dividends. However, despite the tremendous expansion of nursery education in the first years of this Parliament, we have been overtaken by England—under the Tories, of all people—which has more places available for vulnerable people under the age of two than are available in Scotland.

We do not have to look very far in Scotland to see how entrenched we have allowed inequality to become. Fewer than 500 people now own more than half the private land in Scotland. In fact, 10 per cent of all land in Scotland is owned by 16 people. One of the Scottish Parliament’s first achievements was to finally abolish feudal ownership and introduce the right for community buyouts, but the drive for land reform has made very little progress in recent years. The First Minister made encouraging noises in that regard. If she can translate her words into actions, we in Scottish Labour will offer our support.

There are many other areas of agreement that we should explore. For example, if we can agree that Scotland suffers from—and that our society and our economy are damaged by—unacceptable levels of inequality, I think that we have the right to know where the SNP stands on the redistribution of wealth. That is a basic Scottish Labour Party principle, which is reflected in our policy choices.

We are promising the people of Scotland that we will restore the top level of 50 per cent tax on all incomes over £150,000 a year, that we will introduce a mansion tax on houses worth more than £2 million and that we will tax the multimillion pound bonuses that are still received by bankers who were rescued by the taxpayer. Why will the SNP not match us on those promises? I challenge the cabinet secretaries today, in this debate, to commit the SNP to supporting Scottish Labour’s pledge to introduce a 50p rate of tax.

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

Will the member outline precisely what powers this Government would use to impose the tax changes that he is talking about? That would need tax powers that his party has no intention of ever devolving to this Parliament.

Photo of Elaine Smith Elaine Smith Labour

Will you start to come to a conclusion, Mr Macintosh? I can give you a bit of extra time to compensate for the interventions.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

Apart from the fact that we are about to gain powers over that very area—[Interruption.]

Photo of Kenneth Macintosh Kenneth Macintosh Labour

We are about to get powers over the top rate of income tax. Further, we have a general election in a few months. In his summing-up speech, will the cabinet secretary commit the SNP to reintroducing the top rate of income tax? What is so difficult about that? Why is it that the only taxes that you are willing to talk about are tax cuts for corporations and you will not talk about the basic principle of the redistribution of wealth?

The Deputy Presiding Officer:

Please address your remarks through the chair, Mr Macintosh.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I wanted to make some points about the inequality that is experienced by disabled people in Scotland, but it is clear that I have run out of time. I will return to that issue at another time.

The Deputy Presiding Officer:

I can give you around another 30 seconds to compensate for the interventions that you took.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

My point is that, with regard to the inequalities that divide our society, there are challenges facing us in the here and now. They will not all be solved by getting rid of the Tories, no matter how beneficial or desirable that may be. We need to start looking at our own decision making—our own powers in our own Scottish Parliament—and start work on building the good society that the people of Scotland want and need. Reducing inequality would be a great place to start.

I move amendment S4M-12095.4, to insert after “same”:

“; believes that more can and should be done to extend the living wage to all those employed on public sector contracts; is concerned at growing inequalities in devolved areas such as health, the widening attainment gap in education and the increased use of charges in social care; calls on all in Scotland to use the powers at their disposal, including digital and transport access for those in rural areas, to reverse these trends”.

Photo of Alex Johnstone Alex Johnstone Conservative

Tackling inequalities is fundamental to a Parliament of this nature. People are, by and large, aspirational: they want to better themselves, and they want to get themselves into better positions and find better positions still for their children.

I and my party have always talked about equality, but as is the case in many discussions, we have perhaps talked of it in a slightly different tone. I remember, as I made my way up through politics, many of my contemporaries talking about equality of opportunity. That does not mean that everyone will have the same treatment, the same income or the same possessions. It means that young people who are starting out in life will all have the same chances as anyone else of achieving their aspirations.

That is why it is extremely important to me to be able to put the Conservative angle on the debate. Of course, “equalities” means different things to different people, but we all have an understanding that we are talking about how we might elevate people who find themselves disadvantaged in Scotland today.

We have already heard a fair bit from the Labour Party about redistribution of wealth. I think that redistribution of wealth through taxation will always be part of the Scottish political agenda, in spite of the fact that I might be less keen on it than others are. However, it is an irrelevance unless we first apply ourselves at least equally to the creation of wealth. That is where our current UK Government has done well; we have seen 160,000 extra jobs created in Scotland since 2010. Although many people will talk about the quality of those jobs, three quarters of them are full time.

Photo of Alex Johnstone Alex Johnstone Conservative

I am afraid that I cannot take an intervention at this point.

Another concern is that Scotland has been successful in attracting a great many immigrants, particularly from eastern Europe, in that time. I will put down a marker that I always do: I am one of the few Conservatives who will never object to eastern European immigration because those immigrants make a vital contribution to the Scottish economy. However, it concerns me that we failed to get our own unemployed people into those jobs when they were created.

The Scottish Government complains that it does not have power over tax but, of course, it has had power over tax since 1999: it could vary the base rate by 3 per cent either way. Next year, it will have more powers and, with the publication of the white paper this week, we will hear about the extra powers that we will get to vary income tax more or less as we see fit. [Interruption.] The cabinet secretary’s protest appears to indicate that she was not talking about income tax at all. It makes me worry that she is, perhaps, talking about wealth and inheritance tax, over which she will not have power under the current proposals.

Welfare reform will produce an important part of the change that we need to achieve. When it comes along, universal credit will, for the first time, give flexibility to allow people to get back into work while not losing the advantage of all their benefits. That flexibility will also include responsibility: opportunities for claimants to take responsibility for dealing with their own resources, including paying their rent, will be a vital part of the change.

That is why the budget for welfare in Scotland is going up, not down. As is pointed out in the amendment in Willie Rennie’s name, which is a textbook amendment if ever I saw one—in fact, I think that he has copied the textbook out—a £2 billion rise in welfare spending is coming in the next two years.

The cabinet secretary complains that there have been £6 billion of cuts in the current five-year spending period. That is to measure the cuts without measuring the pluses. The fact is that much of that reduction of £6 billion is the removal of tax credits, which has been replaced by a massive increase in tax thresholds that, by April this year, will deliver more than £800 to every working individual.

Photo of Alex Johnstone Alex Johnstone Conservative

I am afraid that I am just coming to the end of my remarks.

The problem is the one that we addressed at the beginning: equality of opportunity. Although wealth is being created in Scotland, jobs are being created in Scotland and jobs are being taken up in Scotland, we are not delivering the opportunity for our young people to get into those jobs in sufficient numbers. Our schools, our colleges, and our universities are failing to deliver the correct qualifications and aspirations to young people in certain areas. That is not a failure of the UK Government; it is a failure of the Scottish Government and it is a failure that has continued over time. That is not to mention the health inequalities, which obviously require that cycles be broken.

The Deputy Presiding Officer:

The member is not giving way, Mr Doris.

Photo of Alex Johnstone Alex Johnstone Conservative

We also need to take seriously the issue of the living wage. My concern has been expressed in Parliament before: it is that the living wage, although it is an aspiration that we should all pursue, does not take account of the many small businesses that will struggle to pay it. In many of them, the proprietors will never be able to achieve that level of income. That is particularly poignant when we consider that many of our ethnic and immigrant communities have many of those small businesses within them.

This is an important debate and one that we need to take very seriously. We all need to understand each other’s positions, which are different but have the same objective. We just have different routes to achieving that objective.

I move amendment S4M-12095.2, to leave out from “deplores” to end and insert:

“notes that, since the UK Government came into office, there are now 160,000 additional jobs in Scotland, which means that last year saw more people in work than ever before; recognises that, UK-wide, three-quarters of new jobs are in full-time positions and two-thirds are in skilled trades; accepts that the introduction of universal credit will significantly increase the flexibility for benefit claimants to enter employment without losing support; believes that universal credit will increase personal responsibility and reduce dependency, allowing more people to benefit from the economic recovery, which is the result of the UK Government’s successful economic policies; expresses concern at the Scottish Government’s lack of action on health and educational inequalities, particularly through its inaction on preventative spend, which promised to move ‘from dealing with the symptoms of disadvantage and inequality towards tackling their root causes’, but welcomes the Scottish Government’s action in paying the living wage as part of its pay policy and, by supporting living wage accreditation, encouraging more organisations and businesses to follow this example when they are able to do so.”

Photo of Willie Rennie Willie Rennie Liberal Democrat

I want to start where Alex Johnstone finished. There is no monopoly of virtue on tackling inequality or poverty in this chamber; it is just that we all have different routes to achieve it. I think that respecting each other for what we are trying to do in this area is an approach that we could all learn from.

Even one child living in poverty is unacceptable. Too many children who are born into poverty in this country die in poverty. Also, their life expectancy is so much shorter than that of many other people who are not suffering from poverty. Inequality is something that divides our society and it is something that I want to tackle, as a Liberal. I believe that the best way of trying to achieve that is to combine the great benefits of building a stronger economy with building a fairer society so that everyone gets an opportunity, regardless of their background—no matter where they come from, no matter what position they are born into and no matter their race, colour or creed. That is a very strong Liberal principle and I will always adhere to it because without—

Photo of Willie Rennie Willie Rennie Liberal Democrat

I will not, just now.

Without fairness, it is difficult to create a truly strong economy and without a strong economy, it is difficult to create fairness. One is not possible without the other. That is why the UK Government has created 160,000 jobs since 2010, as Alex Johnstone rightly said. Actually, it has created more jobs than that; it has created 168,000 jobs since 2010. Despite what the SNP Government claims, the vast bulk of those are full-time jobs and skilled jobs.

The United Kingdom has one of the fastest growing economies in the G7. That means that we have 168,000 more wage packets going into households and 168,000 households that have a better opportunity in life. In tandem with economic growth, we have also introduced the biggest-ever change to our income tax system. Raising the tax threshold to £10,600 means that 260,000 people in the lowest-paid households—the lowest income earners in Scotland—are now paying no income tax whatsoever. That is very progressive. Those on low and middle incomes are benefiting too. More than 2 million taxpayers—

Photo of Willie Rennie Willie Rennie Liberal Democrat

I will not, just now.

More than 2 million taxpayers in Scotland have had their tax cut by more than £800.

Photo of Willie Rennie Willie Rennie Liberal Democrat

No matter how loud he shouts, Mr Stewart will not get taken. I will give way to the minister.

Photo of Roseanna Cunningham Roseanna Cunningham Scottish National Party

I am listening with care to Willie Rennie expounding on how much better things are getting. I wonder whether he has seen the in-work poverty statistics that were published this morning. If he has seen them, can he explain how there can be such a rise, against the backdrop of the wonderful picture that he is painting?

Photo of Willie Rennie Willie Rennie Liberal Democrat

The reality is that we are facing very difficult economic circumstances—[Interruption.]

SNP ministers may scoff, but the UK Government has made the biggest change to our tax system, which has lifted a lot of people out of income tax altogether. If we had listened to the SNP Government, those people would not have received any of that benefit.

Members should remember that the SNP, in its white paper “Scotland’s Future”, did not support the Liberal Democrat proposal to go even further and raise the tax threshold to £12,500. The SNP simply wanted to increase the threshold in line with inflation.

Photo of Willie Rennie Willie Rennie Liberal Democrat

That policy would not have benefited low-income and middle-income earners, so I will take no lectures from the SNP Government on trying to incentivise people into work and make things fairer for those in work.

The Deputy Presiding Officer:

The member is not giving way, Mr Stewart.

Photo of Willie Rennie Willie Rennie Liberal Democrat

We ought to go further, to £12,500, which will mean that people who are on the minimum wage will be taken out of income tax altogether. That would significantly benefit people on low incomes and those in low-income households.

In addition we are, by increasing the minimum wage, making a big difference to people on low pay. Vince Cable has advocated to the Low Pay Commission an acceleration in the rate of increase in the national minimum wage, starting last October. Now, for the first time in many years, wages are rising faster than inflation. Again, that offers good prospects for improving the conditions for people who are working.

That is one half of the equation in trying to tackle the inequality gap and build a stronger economy. The second part concerns what Government can do to increase opportunity. Despite the SNP’s fine words on improving childcare, we are still lagging behind England in that area. Only 27 per cent of the poorest children in Scotland are benefiting from nursery education for two-year-olds, whereas in England the proportion is 40 per cent, which is much higher. One would think, given the rhetoric from SNP members, that childcare provision in Scotland is far superior, but the reality is that we are lagging far behind.

Photo of Willie Rennie Willie Rennie Liberal Democrat

I would love to, but I have only 30 seconds left. Perhaps we can cover the point when the minister sums up.

On childcare, it is important that the Scottish Government get its act together. Perhaps it should listen to the fine words of Bob Doris, who has made some great speeches on childcare. It is important that we move even further on childcare, and on mental health. That is another area of public life in which the Scottish Government needs to lift its efforts to enable more people to get back in to work, because so many are blighted by poor-quality services that are provided by the NHS for dealing with mental illness.

Creating a stronger economy and a fairer society is necessary in order to reduce inequality. That is a principle to which Liberal Democrats will always adhere.

I move amendment S4M-12095.1, to leave out from “deplores” to end and insert:

“considers that even one child living in poverty is unacceptable; believes that the best way to tackle poverty is by creating more jobs and opportunity for everyone, regardless of background, and welcomes that, since May 2010, a job has been created each minute of every working day; notes that over 260,000 of the lowest paid workers in Scotland now pay no income tax and that over 2.2 million taxpayers in Scotland have had their taxes cut because of the increase to the personal allowance and supports the plans to increase the allowance to £12,500 in the next UK parliamentary term; welcomes the UK Government’s decision to increase the national minimum wage from October 2014 and its acceptance in full of the Low Pay Commission’s recommendations; recalls that the Scottish Government’s white paper on independence did not support an increase in the personal allowance to £12,500, meaning that people on low incomes would have paid more tax and had less money to live on, but did propose a cut in corporation tax; further recalls that the white paper did not include an increase in social security spending of £2.5 billion, despite the Scottish Government and SNP members having called for spending increases; notes that the Expert Working Group on Welfare confirmed that, under the present UK administration, welfare spending is set to increase in Scotland by £2 billion by 2016-17; recalls that the Scottish Government’s Fiscal Commission Working Group advised it to match the trajectory of UK deficit reduction, even beyond the 2015 general election; notes in particular that motion S4M-05521, which was approved on 31 January 2013 with the support of Scottish ministers and SNP members, named the priority for social security spending as increasing child benefit for people earning more than £60,000 per year; notes evidence and expert opinion that suggests that investment in the first three years of a child’s life is critical for their future life chances; believes that investment in early years education and quality childcare can help to close the attainment gap as well as being a sound investment for economic and social wellbeing; welcomes the expansion of free childcare to 15% of two-year-olds in Scotland; believes that there should be a further expansion in free early years childcare to match the provision on offer in England, and considers that the best platform to achieve a strong economy and a fair society best able to tackle inequality and ensure opportunity for everyone is from an economy anchored in the centre ground, with spending and borrowing balanced to allow continued movement from economic rescue to recovery.”

The Deputy Presiding Officer:

We come to the open debate. I ask for speeches of six minutes, please. There is at present a little bit of time for interventions.

Photo of Gordon MacDonald Gordon MacDonald Scottish National Party

The Poverty Alliance highlights in its briefing the extent of in-work poverty in Scotland. It states:

“There are currently 820,000 people living in poverty in Scotland. Of these, 180,000 are children. Overall, 19% of children are living in poverty, and almost two thirds of these are in a household where someone works. Low benefit levels and poor labour market conditions mean that people are finding it harder and harder to make ends meet. While work was once thought to be a route out of poverty, more than half of adults living in poverty today, live in households where someone works.”

Governments around the world have the ability to put in place policies to tackle poverty in society by setting a minimum wage or designing a welfare system to support families that are struggling to make ends meet, but that is not the case in Scotland. The Scottish Government has no control of either the minimum wage or the welfare system as those areas are reserved to Westminster.

Since 2008, successive Labour, Conservative and Lib Dem Governments have failed to ensure that the minimum wage has kept pace with inflation. The Resolution Foundation calculates that that leaves the minimum wage £1,010 lower a year than it was in 2008. Last year, following the referendum, there were calls to devolve the minimum wage to Holyrood so that we could set the rate here. Once again, though, Westminster parties failed families in Scotland by not supporting the SNP proposals.

When it comes to the changes to the welfare system introduced by the Conservative and Lib-Dem coalition, the Scottish Government is left trying to mitigate the worst aspects, rather being in a position to create a welfare system that is simple, makes work pay and lifts people out of poverty.

In the past year, the Scottish Government has maintained funding for the Scottish welfare fund, offset the cost of the bedroom tax to families and mitigated the cut in funding for council tax benefit. The difficulty is that the Tories, as part of their austerity measures, are planning to slice billions off working-age benefits by measures such as freezing child benefit and tax credits, resulting in a low-wage family with one child losing more than £350 a year.

As the motion states, the work of the Scottish Government’s fair work convention

“to promote and sustain a fair employment framework”—

for Scotland is—

“at risk of being undermined by the £6 billion of welfare cuts being made by the UK Government.”

The fair work convention is about bringing together unions, employers, public sector bodies and Government to promote good industrial relations, to highlight the fact that business productivity increases with the payment of fair wages and to promote the living wage to employers.

The Procurement Reform (Scotland) Act 2014 made it clear that one of the factors that authorities will require to evaluate is a contractor’s approach to pay and the living wage. Public authorities will be required to set out, in their procurement strategies, what their policy is in relation to ensuring that the companies with which they contract pay the living wage.

Since April 2014, 100 employers in Scotland have been registered with the living wage accreditation scheme. They range from builders to universities and from tour companies to local authorities. We need to encourage all companies and organisations that currently pay the living wage to register. Only one local authority out of 32 and one distillery out of 90 are listed as accredited living wage employers. Only one bank, two housing associations, one university and two colleges are registered. Are there really no others in those sectors that pay the living wage?

Eighteen per cent of the workforce are paid below the living wage; the majority of those are in the private sector and are women. They mainly work in retail, hospitality or the social sector, and yet no supermarkets, hotels or restaurants, and only a handful of care organisations, are listed as accredited employers.

In its report “Work That Pays”, the Living Wage Commission looked at the business case for introducing the living wage. It stated that it

“has established that the Living Wage can open the door to productivity increases for businesses. This is the result of Living Wage employees contributing higher levels of effort and an openness to changing job roles. Other business benefits include cost-saving opportunities from increasing staff retention and the stability of the workforce, as well as reduced absenteeism. The evidence points to improved levels of morale, motivation and commitment from staff across the pay distribution in Living Wage workplaces.”

The commission also examined the public policy case for introducing the living wage. It referred to an analysis provided by Landman Economics that shows that, across the UK,

“the Exchequer could gain up to £4.2 billion in increased tax revenues and reduced expenditure on tax credits and other in-work benefits from an increase in coverage of the Living Wage.”

The report went on to say:

“There could be further multiplier effects arising from putting a modest amount of disposable income into the pockets of the UK’s lowest paid staff, with demand subsequently increasing in the economy.”

The Scottish Government has led the way as a living wage employer and some organisations across Edinburgh, including CHAI—the Community Help and Advice Initiative—based in my constituency, have stepped up to the mark. We need other employers to recognise the benefit to their business, the wider community and society of paying the living wage and to lead by example.

Photo of Rhoda Grant Rhoda Grant Labour

The Health and Sport Committee’s recent inquiry into health inequalities showed clearly that they are a symptom of an unequal society rather than the cause. The cause is income inequality, which in turn leads to inadequate housing, which means that people live in cold, damp properties because they cannot afford any better. They eat inadequate diets. We all know that a meal of pie, beans and chips is much cheaper than a hearty beef stew and potatoes. People do not choose to feed themselves or their families on unhealthy food; they have to, or else they go hungry. It is sad that rickets has come back among young people in our society, as past generations thought that they had eradicated it totally from this country.

When someone is cold, hungry and in poverty, that impacts on their physical health, their ability to fight infection and their ability to concentrate. Education is impacted because of the difficulty of studying in a cold home on an empty stomach. A parent’s priority becomes keeping the roof over their family’s heads and trying to feed their children as best as possible. Things such as homework become less of a priority when basic survival is difficult. Therefore, children who are brought up in poverty seldom reach their full potential.

We know that, if someone is born in poverty, they are more likely to live in poverty. A mother’s income influences her child’s future income. Therefore, a vicious cycle of poverty starts, with little hope of people changing their life chances. The gender pay gap keeps women’s incomes low. If that results in their children receiving lower pay in future, we start a cycle of poverty by paying women less.

There is no easy fix, which is why fighting poverty should be cross department and cross committee. Indeed, if we were really committed, it should be an issue for every organisation, business and individual in the country. The whole of society loses when a child does not grow up to reach their full potential, as that diminishes what they can contribute. It means that society will in future have to intervene to deal with the health problems that are caused by poverty. Taxpayers must supplement the income of people in poverty, who will never reach their full earning potential. Had we tackled their poverty in childhood, they would have been contributing to society rather than taking from it.

Exercise and recreation are important for health, but facilities for that are often missing from our most needy communities. Deprived areas are beset with social problems such as drug taking, which makes parents reluctant to put their children out to play. Nor can they afford the after-school clubs that many of us take for granted. Even if the facilities are there, is there spare money in the home for a football strip and boots or for dance shoes or the like? Money is required to travel to clubs and sporting facilities and, depending on the age of the child, the parent might need to go with them. All those things are barriers to accessing exercise. Children miss out on more than exercise; they miss out on the opportunity to socialise, interact and learn skills that are necessary in later life for building personal and professional relationships.

Living in poverty and hopelessness impacts on people’s mental health—hence the increased levels of drug taking and alcohol misuse in poorer communities, as people self-medicate to deal with their circumstances. That in turn impacts on their general health and their ability to nurture their children. How can someone instil hope and ambition in their children if they have none themselves?

The issues do not end there, however. We know that poverty leads to poorer health and a lower life expectancy. Therefore, we need to invest more resources in health and social care for those who suffer in that way. The Royal College of Nursing initiative nursing at the edge shows what community nursing intervention can do to help change people’s circumstances and support them. The deep-end general practitioners also report on the complex issues that they need to deal with, which involve not only people’s health but the social circumstances that impact on health. That means that such people require more input from professionals and closer working between professionals to deal with the complex problems that they find.

However, it is less likely that poorer areas will enjoy better services that are based on need. The inverse care law suggests that those who are in greater need tend to receive fewer services, which can be for a number of reasons. People are less likely to seek medical help because they do not have the sense of entitlement that others have to good health. Services are often some distance away, inaccessible or comparatively expensive to access using public transport. The daily pressures of fighting for survival often leave people with little time to take care of themselves.

If we are to encourage people to access healthcare sooner, we need to provide that care in a way that is accessible to them and that fits with the pressures and circumstances that they face. We have some way to go before we achieve that. As a minimum, we need to allow health professionals time to work with people, in order that they can signpost them to services that deal with their other problems.

Health inequalities can be tackled only by creating a fairer society, in which wealth is shared and opportunity is open to all. Until that happens, we all need to foot the bill for dealing with the consequences of inequality. We need to ensure that resources are placed where they meet the greatest need, which requires targeting funding if there is not enough to go around. We all like universal services, but when there is an inbuilt inequality in our society we must target services to those who are in most need. The alternative is that we all pay more to meet that need. If we are not willing to acknowledge that fact, we are acknowledging that we live in an unfair and selfish society.

Photo of Christina McKelvie Christina McKelvie Scottish National Party

Inequality is cyclical and self-perpetuating. If we start off with low performance in the economy, low pay, children in poverty and people in work needing food banks, already the pattern is set for health inequalities, reduced school performance and fewer opportunities to progress into decent employment, and the cycle comes full circle before the same depressing journey starts all over again. Carol Craig, in her book, “The Tears that made the Clyde” likened it to the Glasgow effect, but it is not restricted to Glasgow.

It does not need to be like this. Westminster has failed Scotland, with the exception of the already very wealthy in the country estates and grand houses, who do very well under the current Government. People are watching their prosperity and their opportunities dwindle at an alarming speed. Increasing levels of poverty and inequality are a clear sign that the UK Government’s economic and social policies are failing Scotland. Why spend £100 billion on weapons of mass destruction and not spend it on opportunities for our young people?

Photo of Neil Findlay Neil Findlay Labour

Ms McKelvie spoke about those people in grand houses. Would she advocate something like increasing stamp duty for people in those grand houses?

Photo of Christina McKelvie Christina McKelvie Scottish National Party

Maybe Mr Findlay should take lessons from his colleague Katy Clark, who he backed in the recent leadership battle, and not vote for £30 billion-worth of austerity cuts. If he did that he would not have to look at the people in the grand mansions, because he would be focused on the people who struggle to pay their rent every day.

A few years ago, most food bank visitors were homeless folk who lived on the street. Now the larger number of clients are families who have a parent working. What does that tell us about inequality? In the 21st century, in one of the richest countries in the western world, the gap between the rich and the poor is widening dramatically. This Scottish Government has made advances, but in effect it is powerless to make any big changes without further devolved powers. I would love to have the same crystal ball that Ken Macintosh has, because obviously he knows what is in the Smith bill.

The situation must change. On Thursday we will see what is in it.

Photo of Christina McKelvie Christina McKelvie Scottish National Party

Maybe Ken Macintosh will tell us where he got his crystal ball.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

The minister seems to be suggesting that tax powers are not coming to this Parliament. Does Ms McKelvie believe that that is the case?

Photo of Christina McKelvie Christina McKelvie Scottish National Party

Ms McKelvie will not put any focus on any Smith commission bill unless it delivers on the vow—and I very much doubt that it will.

This is the UK Government’s chance to live up to its word and the Labour Party’s chance to live up to its vow: the chance to deliver on the powers that were promised in the final days of the referendum and translate those proposals into real action.

In this Scottish Government, we believe that equality and cohesion are good for growth as well as good for individuals, and we will do all that we can within our powers to tackle inequality. Of course, inequality is about a great deal more than the money in people’s pockets. Health, education, gender, race, skills, training, job choices and access to services are all significant issues in this crucial balancing act.

Seeking an equal, fair and prosperous economy demands two fundamentals: first, recognition that a strong economy is both the driver and the follower of a fair and equal society and, secondly, that Government has the power, the vision and the commitment to build genuine equality for all.

This Government has everything except enough power to bring about structural change. We pay the living wage to all our public service staff, but we need to control the minimum wage. We need to end zero-hours contracts and the unfair umbrella scams in our construction industry.

Unlike Westminster, we have given our national health service staff a modest pay rise. Scotland has the highest employment rate and the lowest unemployment and inactivity rates of all four UK nations, but we have a London Government, backed in full last week by the Labour Party, bringing about another £6 billion of cuts on top of those already in place.

We do not create a more prosperous economy and a fairer society by ensuring that the most vulnerable and the needy are the ones who are pushed further away. If we hold young mothers back from returning to work because childcare costs are too high, we do not improve the economy; we hold it back, and we hold back that woman’s own prosperity and that of her family, too.

Female employment in Scotland has reached its highest level on record, rising to 1.3 million, up 46,000 in the past year. If we provide, as this Scottish Government does, a decent, free childcare facility, we bring women back into the workforce. That in turn creates more wealth, better tax revenues and a healthier economy.

Building equality will not be an overnight job. We all need to be engaged, not just the Government. There is a crucial role for all the organisations that we have heard about—NHS Scotland, Oxfam, the Scottish Council for Voluntary Organisations, the Coalition for Racial Equality and Rights and all of civil society.

I would love to be a part of doing just what Oxfam has asked for in its global report, “Even it Up: Time to End Extreme Inequality”, and I know full well that many of my colleagues across this chamber and in the Scottish Government would love to do the same, but we are denied the powers in this place to allow us to move forward substantially with our ideals and vision. We do what we can within the powers that are granted to us.

Last week, the Scottish Government and the STUC committed to closer working to achieve their shared vision of a wealthier and more equal society for Scotland. The establishment of a fair work convention will further enhance how Government, employers, trade unions and employees engage to embed progressive workplace practices. I ask ministers to have a close look at the umbrella scam issue—Channel 4’s “Dispatches” did a piece on it last night. They cut out some material, but hopefully we can gather some of that evidence. Grahame Smith, the STUC general secretary, has welcomed the approach, saying:

“this stands in sharp contrast to the outdated approach from the Government at Westminster which does not recognise the positive contribution that trade unions bring to society and the importance of fair work in achieving key economic and social objectives.”

I ask Mr Findlay, what trade union legislation did Tony Blair overturn in his time in government? The answer is none.

We share the desire for a better Scotland and we will make it happen.

Photo of Margaret McCulloch Margaret McCulloch Labour

Since this Parliament was established in 1999, I believe that we have proven collectively that we are at our very best when tackling head on the inequalities that scar our nation, from breaking new ground with land reform to confronting old prejudices such as homophobia and bigotry; challenging the stigma around mental health; speaking out against female genital mutilation; standing up to traffickers and those who exploit migrants; exposing the conditions in which too many Gypsy Travellers are forced to live; and giving a platform to carers, young people, pensioners, the disadvantaged and the underrepresented.

This young Parliament can mature—and has matured—by addressing the inequalities that afflict Scotland no matter how challenging, by fostering genuine equality and diversity and by championing the human rights written into our founding statute.

We have challenged some of the most pernicious, the most complex and often the most sensitive of social inequalities. Where necessary, many of us will even have challenged ourselves and our own assumptions about equality and we will have challenged our Scottish Government, too, in pursuit of a fairer Scotland. That is fair. That is what the Parliament of a compassionate, socially progressive country must do. Where we find injustice, we must confront it.

In a briefing to members, Oxfam has shone a light on some of those injustices. Citing the Scottish Government, it says that the richest 10 per cent of households in Scotland have 900 times the accumulated wealth of the poorest.

Audit Scotland says that the average healthy life expectancy of people living in the least deprived areas in Scotland is around 18 years higher than that of people living in the most deprived areas. More than half of the lowest achieving secondary 4 pupils in Scotland’s schools come from the three most deprived income deciles.

I appeal for all of us to confront those economic, health and educational inequalities and the issues of social justice that we are debating today with the same rigour that we have applied to equal opportunities and social affairs.

We cannot pull our punches in the fight against inequality. It is for that reason that I intend to support the Labour amendment. We must do all that we can, using every means at our disposal, to narrow the gap and fashion a fairer, more equal society. Like the Scottish Government, I believe that the coalition’s economic and social policies are failing. After the slowest recovery in 100 years, Scotland and the UK are still struggling with a cost-of-living crisis and rising inequality.

There is an alternative. We can build a higher-wage, better-skilled economy that is supported by good public services and rich with opportunities not just for some, but for all. We all have to play our part. We in this Parliament are not bystanders. We have a duty to find solutions and not just excuses.

Most of us in the chamber agree that the national minimum wage successfully set a floor below which wages are not allowed to fall, tackling the worst of poverty pay and reducing wage inequality. Most of us also agree that the living wage would reduce in-work poverty, improve employee retention and wellbeing and even improve productivity in the workplaces of living wage employers.

The Scottish Government has previously explained its hesitancy to legislate to guarantee that the public sector uses its purchasing power to secure the living wage from contractors, but it has not given a good reason why it refused to accept constructive non-legislative proposals from my Labour colleagues last year for a national living wage strategy and a Scottish living wage unit. We must do more to promote the living wage for the sake of those who are struggling to get by.

I also want to highlight the case for early intervention and preventative spending. Many of us will know about the work of experts in that field, including those in the violence reduction unit, Suzanne Zeedyk and Sir Harry Burns. We could close the life expectancy gap and the attainment gap by addressing the social determinants of inequalities, intensifying our focus on the early years, tackling insecurity in people’s lives and building a sense of coherence and community.

In its “Scottish Spending Review 2011 and Draft Budget 2012-13”, the Scottish Government committed itself to

“a decisive shift towards preventative spending.”

I was a member of the Finance Committee at the time. However, in its recent report on the draft budget for 2015-16, the Finance Committee states:

“there is little evidence of the essential shift in resources taking place to support a preventative approach.”

That view is also endorsed by Audit Scotland. To address the inequalities that hold Scotland back, the Scottish Government must embrace the practice and not simply the theory of preventative spending.

As I have said, this Parliament is at its best when it is unashamedly confronting the inequalities that hold Scotland back. We should be offended by injustice and frustrated by inaction. For that reason, I call on the Scottish Government to strengthen its commitment to both the living wage and early intervention.

Photo of Bob Doris Bob Doris Scottish National Party

I begin by referring to the Health and Sport Committee’s recent report on health inequalities. A key thread that runs through that report is the link to economic inequalities. Whether it is through poor-quality, low-paid or temporary work, the committee is clear that income inequality and poverty link directly to significant health inequalities throughout people’s lives. I am therefore pleased that the motion for this debate on tackling inequalities gets to the root causes of the fundamental health inequalities that our country suffers from.

This debate, therefore, is not just about the money in the pockets of Scotland’s workers and families, although that is important, and it is not just about the patterns of work, which can affect the quality of our lives and disempower some of our most vulnerable communities. It is also about ensuring that the poorest people in our society live longer than they are living now, that they are healthier and happier, that they feel more secure and empowered and, hopefully, that their longevity increases. That is a huge obligation on everyone in this Parliament, and the challenge in the motion before us is to be successful in that regard. The motion does not mention health, but every successful action that is referred to in the motion will have positive health consequences for the most vulnerable in society, whom we all represent.

On that front, I am very pleased to see that an independent adviser on poverty and inequality is to be appointed by the Scottish Government and that there is to be a poverty impact assessment for future Scottish Government legislation. I wonder whether the cabinet secretary can give cognisance to the issue of health inequalities being part of the independent adviser’s remit, although I accept that the nature of its independence means that the cabinet secretary must be careful about how prescriptive he is. In addition, it would be useful to have information on whether the poverty impact assessments could give cognisance to health.

We heard earlier in the debate the statistic that 59 per cent of children in poverty stay in a household in which only one adult is in employment, whereas in 2009-10 that figure was 43 per cent. The fact that things are getting dramatically worse is an absolute disgrace. That situation needs to be challenged, and two of the most obvious actions—I accept that there are others—to tackle that disgrace are, first, actions around the minimum and living wage; and, secondly, actions around the tax credit system.

In relation to the tax credit system, recent reforms have put 100,000 households deeper into poverty, and 80 per cent of those households contain children. The Scottish Parliament has no control over the minimum wage or the tax credit system. For the parts of the living wage over which the Scottish Government has control, it implements the living wage in all its pay policies as standard. I do not want to get drawn into debate with Labour over whether it is legal—

Photo of Bob Doris Bob Doris Scottish National Party

Excuse me one second and let me develop my point, please.

I do not want to get into a debate with Labour when it says that the Scottish Government has the power now to enforce the living wage elsewhere. This is not a bun fight. If the Scottish Government thought that it could enforce the living wage elsewhere, it would do so—it has made that clear. Let us not have petty political point scoring over the issue; let us work together to improve the income of the most vulnerable people in society.

I turn to what we can do together. It would be for Labour to justify why some of the powers that would improve and enhance the lives of those whose lives are blighted by poverty are not coming to this place, which is what I would like. However, in terms of the powers that we have in this place, how can we promote a living wage? We have heard about the Poverty Alliance’s living wage accreditation scheme.

Photo of Margaret McCulloch Margaret McCulloch Labour

Does the member not think that if the Government backed and supported a Scottish living wage unit, that would encourage employers to introduce the living wage?

Photo of Bob Doris Bob Doris Scottish National Party

I do not see how more can be done to encourage employers to deliver on the living wage than to empower the Poverty Alliance to go about its business, given that it has recently signed up the 100th employer to deliver on a living wage. I think that a little bit of party politics is coming in here. If an idea is a good thing, we will do it—we do not care whose idea it is. I say to Labour that we would do it as the right thing to do.

I offer a couple of ideas. I am very proud of the small business bonus scheme that we have in Scotland, which supports many small businesses. Of course, not all of those businesses pay the living wage. I like to think that, where possible, we can use the small business bonus scheme to incentivise small businesses to move towards paying a living wage. The scheme is a blunt instrument and can have unintended consequences. [Interruption.] I note Labour members cheering at that. However, it is worth exploring what we can do with the scheme with regard to the living wage, and we could do likewise with the use of apprenticeships in Scotland.

I do not think that every employer can just pay the living wage overnight, but I think that most of our employers should have, where they can, a strategy towards paying the living wage. We can follow that route of travel together.

Another key part of the Health and Sport Committee’s report was about the health consequences of the £6 billion welfare reform that is befalling Scotland. I finish as I started by saying that we will do all that we can in this Parliament to mitigate the worst aspects of inequality, but the root causes of that and the powers to deal with it sit in another place. That is not to let the Scottish Government off the hook; we must work together in partnership. However, let us not kid ourselves: the real levers of power sit elsewhere.

Photo of Christine Grahame Christine Grahame Scottish National Party

We can all sign up to building a fairer Scotland and tackling inequalities, and we fully support the payment of the living wage, given the importance of work not just for the financial security and sense of worth that it brings an individual, but for the role that it plays in enabling them to have a healthy physical, mental and social life.

I want to quote from an article in Scottish Justice Matters of June 2014, which touches on some of the issues that Bob Doris, Duncan McNeil and other members have raised in the Parliament over a long period of time. It says:

“People who come to the attention of the criminal justice system in Scotland are drawn predominantly from communities that experience poor physical and mental health, often associated with a lifetime of social exclusion, lack of employment, hope, purpose and their consequences.”

I say to Bob Doris that one of the depressing things about having been a member for 15 years is the knowledge that we have been talking about the inequalities in health for a very long time, regardless of which party has been in government. I recall that when I was the convener of the Health and Sport Committee, Harry Burns, the then chief medical officer for Scotland, told us that inequality begins in the womb. The mother might have a poor diet and she might be a smoker, an alcoholic or an addict. Tragically, babies have been born with foetal alcohol syndrome and withdrawal symptoms. I remember a long campaign that Duncan McNeil was involved in on the drug dependency of families and the need to tackle that because of the impact that it had on the children. Regrettably, achieving societal change through politics is sometimes like turning round the proverbial oil tanker.

The inequalities that begin before birth continue till death. We know that in the poorest areas of Glasgow death is premature in comparison with the national average. I want to focus on the one area in which, ironically, inequality is a plus—it is a plus for those who seek a criminal career, who end up as guests of Her Majesty in prison. Addiction makes a significant contribution to people being incarcerated. Many prisoners from young offenders to those in the women’s institutions to those in the adult prisons have a long history of drug and alcohol abuse. Many also—as a consequence of or separately from that—have mental health problems, which often led directly to their committing offences. Those are sad circumstances. Even more depressingly, such problems permeate through the family—sometimes over generations—to the extended family and the community beyond.

As the article that I quoted from says, those families and communities are often in highly deprived areas of no employment, low employment or no expectation of employment. Although we have long since moved away from prisons being merely places of punishment with turnkeys to being places where freedom is deprived but we hope to rehabilitate, and where prison officers play a substantial role in the rehabilitation process, the revolving door of recidivism continues.

Big moves have been made to ensure that throughcare starts in prison and continues outside it. The worst time for a prisoner can be the day that they come out of prison; it might be six to eight weeks later and, in some cases, a few years afterwards. That is particularly the case if they are not supported in the community, where they might get drawn back into the lifestyle that resulted in their ending up in prison in the first place.

Although the Scottish Prison Service is endeavouring to turn around the lives of such people, we must realise that some 60 per cent of prisoners have difficulties with literacy—reading and writing—which is a very basic thing, and some have problems with numeracy, too. The challenge to society across all portfolios and all politics is momentous.

Despite the improvements that have been made in throughcare, when prisoners are discharged they end up back in communities where they carry the burden of the huge inequalities that they have borne since their childhood to do with their health, their education and their lack of basic skills and find themselves in a challenging situation that we would find difficult to face. Sorting out such inequalities is a tough call. There are a few good employers who proactively take on ex-prisoners, to give them a chance, but many employers will not do that. That is a further inequality.

I am glad that the debate has expanded beyond the living wage, although that is important, to look at the root causes of inequality and how inequality crosses from health to justice to education, with everything sometimes crashing together in the catastrophe of imprisonment for some people.

We need to deal with the fundamental inequalities. I say to members of the Scottish Parliament, whether they have been here for three years or eight, please let us not find ourselves discussing this another four or five years down the line; there are solutions out there, which are not party political.

Perhaps, for a start, we need to grasp the issue of getting the public at large to understand that some people in prison are victims. Of course they might have erred and lost the right to freedom of movement, but they have come to that place for a reason, some of which is to do with our society letting them down.

Photo of Duncan McNeil Duncan McNeil Labour

Another Tuesday and another debate on a topic on which there is probably more to unite us than there is to divide us, although—as usual—the way in which it has been set up is such that at times someone in the public gallery might think that there is no agreement at all.

We are dealing with an issue that engenders frustration and anger. I represent a constituency where nearly a fifth of people are income deprived and rates of mortality from all causes are higher than the national average, so we have every right to be angry and frustrated.

However, we owe those people more than anger. As members, including Christine Grahame, said, we need to be honest and accept that we are dealing with a wide issue, which cuts right across Government and society, and which is complex and difficult, requiring commitment and hard political decisions.

This is not just about the divide between the super-rich and the super-poor. It is about the divide between people on low pay and people on no pay, male and female, old and young, and able and disabled. Moreover, the issue cannot be attributed to a single moment in history, to a single Government or party or—even in this moment of crisis—to austerity.

We would do well to remember what Campbell Christie said when he was asked to consider the issue, which I mentioned in last week’s debate on public services:

“Alongside a decade of growth in public spending, inequalities have grown too”.

Even when we had the money, did we spend it wisely? Despite significant investment, in-work poverty is rising, educational attainment is falling and the health gap between different parts of the country is widening.

The allocation of finance is important in tackling inequalities, but money alone cannot solve the problem. We have to ensure that we have the right policies in place and the determination to see them through.

We have been focusing on the growing number of people who find themselves in work but on benefits and in poverty. Did we really think that cuts in the bus service operators grant, which pushed up fares, would not affect the working poor? Did we really think that decisions to cut the housing budget would not lead to rents being put up for the working poor? Did we really think that cutting local government spending would not push up the cost of childcare?

All those actions, for which we bear responsibility, impacted negatively and disproportionately on the working poor. We need to be clear about the objectives that we are trying to achieve. We must do better. If we want to tackle inequality, the left hand needs to know what the right hand is doing.

We also need to be honest and not pretend that the argument has been won—that all that we need is more money and new powers. Harry Burns has been mentioned a couple of times in the debate. He told the Health and Sport Committee:

“Part of the challenge is about not just pulling a set of policy levers, but creating a sense of community and of compassion ... I listened to Amartya Sen, the Nobel prize-winning economist, giving a lecture ... entitled ‘Poverty and the tolerance of the intolerable’. His analysis as to why societies such as India tolerate extremes of poverty is not that there is nothing that they can do about it—there is plenty that they could do about it—nor that they do not care about it, but that the middle classes do not understand how destructive poverty is. They think, ‘We live with people, we know they’re poor, but if they get free schools and a free health service and that kind of thing, it can’t be that bad.’”

Harry Burns also said:

Gerry Hassan’s new book argues that Scotland’s problem is a lack of empathy and connectedness; indeed, the Glasgow Centre for Population Health’s comparative analysis of Glasgow, Liverpool and Manchester shows that although the three cities are the same in terms of inequality and average income they differ significantly in their causes of premature death, and that the set of indicators that is completely different between the three cities is that related to empathy and connectedness.”—[Official Report, Health and Sport Committee, 13 May 2014; c 5379, 5378.]

We present our aspirations in our election manifestos, and when we win the argument we can get on our high horse in this chamber and say, “This is what we need to deliver.” However, as well as having aspirations we need to win the argument, and the argument has not been won. There is no clear commitment to empathy and connectedness in our society. When we win that, it will be up to us politicians to deliver the fairer Scotland that our society deserves.

Photo of Kevin Stewart Kevin Stewart Scottish National Party

Analysis by the Equality Trust shows that the UK is the fourth most unequal country in the OECD and that the overall number of people who are living in relative poverty in our country rose to 1 million in 2012-13. We also know that many of the families that are struggling to get by have family members in work. Fifty-nine per cent of children who live in poverty live in households with at least one adult in employment.

Between April 2013 and March 2014, 71,428 people, including 22,387 children, received a three-day supply of emergency food from Trussell Trust food banks in Scotland. The figures for December, which have just been released, show that 10,489 folk were helped by the Trussell Trust in Scotland, which is the highest number on record, and that a third of those were children. Those figures are absolutely shocking, and they show clearly that the austerity policies of the Tory-Liberal Government, which have also been adopted by Labour, are failing Scotland and the people of Scotland.

We hear from certain folk, “Oh, well, we’ve done this,” and, “This may work.” We heard that from Mr Rennie today when he spoke about personal allowances. Mr Rennie would be wise to listen to what some of the experts think that the raising of personal allowances has done. They think that that policy has benefited the rich more than the poor.

Julia Unwin, chief executive of the Joseph Rowntree Foundation, said:

“Raising the personal tax allowance is an expensive way of helping the working poor—most of the additional money will actually go to better-off families, while poorer families only keep a third of the tax cut.”

The Institute for Public Policy Research stated:

“But the poorest households gain less from this change, and households in almost all sections of the income distribution will see a greater amount taken away through the 1 per cent cap on benefits uprating than is handed to them via personal tax reform.”

It goes on. The Institute for Fiscal Studies stated that the people who will gain most from the personal allowance rises are

“those in the upper-middle of the overall income distribution.”

Those are the facts.

Alex Johnstone rose—

That is not redistribution; nor is it progressive as Mr Rennie would have us say. It is a case of Mr Rennie getting in his excuses for backing the austerity policies of the Tories.

On that note, I will give way to Mr Johnstone so that he can defend Mr Rennie—or not, as the case may be.

Photo of Alex Johnstone Alex Johnstone Conservative

Is the member aware that the increase in the basic rate tax threshold was entirely financed by reducing the upper rate tax threshold? As a consequence of that, the total amount of tax stayed the same, but the poor paid less of it.

Photo of Kevin Stewart Kevin Stewart Scottish National Party

That is not what the Joseph Rowntree Foundation, the IPPR or the IFS are saying. In response to Mr Johnstone, I point out that what we have seen is a form of regressive taxation, with a cut from 50 to 45 per cent for the richer in society—something that he obviously wants to see; something that I do not think was right.

We hear from the Labour Party about taxing the richer folk in society. It forgets that for most of its time in government the highest tax band was 40 per cent—not the 45 per cent rate that it is now, but 40 per cent. That is not progressive taxation. I would want to see Mr Findlay rise to defend that position if he can.

Photo of Neil Findlay Neil Findlay Labour

I wonder whether Mr Stewart can advise us whether he supports the 50p rate that Labour would impose if in government. If not, what level of taxation would he support?

Photo of Kevin Stewart Kevin Stewart Scottish National Party

I can tell you now, Mr Findlay, that if I had been in the House of Commons at the time of the vote on the reduction of the tax rate from 50 to 45 per cent, I would have voted to retain the 50 per cent rate. [Interruption.]

Photo of John Scott John Scott Conservative

Mr Findlay, that is enough.

Photo of Kevin Stewart Kevin Stewart Scottish National Party

I will tell the member something else that I would not have done: last week, I would not have entered the division lobby with the Labour Party, joining the Tories to vote for more austerity.

At least Katy Clark, Mr Findlay’s running mate in the Scottish Labour Party leadership elections, had the sense to vote with the Scottish National Party, Plaid Cymru and the Greens—the more progressive parties—against austerity. During the campaign, she asked:

“Which side are you on? An end to austerity vs No clear plan to tackle rising inequality”.

That was obviously an attack on the Blairite Murphy, because we have seen Katy Clark go agin everything that that Blairite has done since.

It is time that Labour members were truly honest with the people of this country about what they are about. They are no longer socialist—they have not been so for a long while. They are led by a Blairite here in Scotland, and they will gladly walk through the lobbies with the Tories to vote for more austerity and they are likely to vote for Trident renewal today. They should be honest with the Scottish public.

Photo of Nigel Don Nigel Don Scottish National Party

I start from the position that inequalities affect us all; I also note that we discussed most of the issues at John Mason’s members’ business debate. Apart from Neil Findlay, I am the only other member here who contributed to the debate. We can largely rerun the debate and I will be asking the Labour Party a couple of questions that it was unable to answer at that time.

I am delighted that “The Spirit Level: Why Equality is Better for Everyone” was mentioned, which of course is the red paper on Scotland. I note that the book even made it into some of my other reading material, because I occasionally like to make sure that I know what the other parties are thinking. We will see where the paper takes the Labour Party, but it seems to have registered that inequalities affect us all, they are bad for us all and they affect every area of life.

I would like to take Ken Macintosh, in particular, back to a debate that we had last November, because he mentioned then the Oxfam report on extreme inequalities around the world. It seems to me that if we think about the extremes, even if we do not have them here, we may learn something about what is going on and be able to derive something from that.

I think that one of the fundamental lessons to which Oxfam alluded was that extreme inequalities generate their own barriers. If a person is sufficiently poor, there is no prospect that they will get together the wherewithal to give them or their family the education that will give them the opportunity to get out of poverty. There is a level below which there is simply no escape.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I welcome Nigel Don’s point and acknowledge part of what he is saying—certainly that socioeconomic deprivation creates extreme barriers—but I question his assertion that extreme inequalities do not exist in Scotland. For example, what is his view of the fact that fewer than 500 people own more than half the land of Scotland?

Photo of Nigel Don Nigel Don Scottish National Party

Forgive me. Let me go back. I was talking about extreme poverty. I may not have put things correctly. I am sorry: the land is an issue that we will come back to another day, otherwise we will never make any progress, but I am with Ken Macintosh. The point is that the levels of poverty in some third world countries are manifestly worse than anything that we see in Scotland. Let us not fool ourselves.

I would like to go from that point towards where Alex Johnstone came in. I think that he said that he was brought up with the idea that the Tory approach is that everybody should have equal opportunity. I think that he missed the point, which others have made, that opportunity is defined in the womb. Actually, a person’s opportunity depends on the family in which they will be brought up and, to some extent, the genetics with which they will be brought up. The same opportunity outside is irrelevant if a person has had in-built inopportunities created for them. I think that that is where the Tories and I will disagree, because they will tell me—it is a thought process—that if everybody is given the same theoretical opportunities out here, they are all equally available. The reality is that poverty is its own barrier, which is why I started there.

We are not talking about some of the enormous inequalities and the extreme poverty that we might see elsewhere, but we can find down our street—I can find in my constituency and I bet that everybody else can find in their constituencies—people whose lack of income completely prevents them from taking some of the opportunities that the Tories and others will insist on telling them exist.

That is the point that we should really start from. We need to understand that until we address the circumstances in which a child is born, we will not make any serious inroads into reducing the inequalities that are manifest in our society. I said that because it is important that it is said. The Government knows that. I am looking at Alex Neil as I say this. He knows fine well that that is the situation, and I know that the Government is working on that.

My script will be completely ignored here. Ken Macintosh said that he is concerned that health policy will not address health inequalities. That is roughly what he talked about. Of course we will not address health inequalities by health policy if the child started in such poverty that those health inequalities and problems are in-built. They will not be addressed in the early years of life because of the parental situation and the poverty in which the child is being brought up. We can do nothing about the genetics of childbirth, of course; we will get anywhere near the issue only if we get back to the absolutely fundamental issue, which is pretty much the day on which the child is born or—come to think of it—the day on which the mother expects to bring the child into the world, because one of the first things that we know is that the child should be breastfed. We have to go back to the time before the child was born to get it right.

The Deputy Presiding Officer:

The member is in his last minute.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

Does the member agree that his point is not entirely true? With regard to widening inequality, in recent years, the life expectancy of the most prosperous women in Scotland has expanded, and the least prosperous women in Scotland are now dying sooner than the most prosperous are. That has happened in the past 10 years.

The Deputy Presiding Officer:

You have 20 seconds remaining, Mr Don.

Photo of Nigel Don Nigel Don Scottish National Party

I was not expecting even that much. I will stick to my fundamental point, which is that a child’s expectations and prospects in life are defined first by where and when they are born, and who they are born to, and, secondly, by the educational position and social status of their parents, which means that unless we improve those we are not going to crack this issue.

Photo of Margaret McDougall Margaret McDougall Labour

Tackling inequalities is a huge topic, which includes health, barriers to work, childcare, digital exclusion, education, housing and welfare, to name but a few issues. I am going to focus my speech on health inequalities across Scotland, which is a particularly important issue in North Ayrshire, which I represent and is where I live.

Health inequality in Scotland is a complex and growing issue. For example, life expectancy in the most deprived areas in Scotland is 70.1 years for men and 76.8 years for women—

Photo of Margaret McDougall Margaret McDougall Labour

Let me get started?

However, in the most affluent areas, life expectancy is 82.4 years for men and 84.8 years for women.

In North Ayrshire, the difference between the most deprived area, which is Fullarton in Irvine, and the most affluent area, which is Whitehirst Park in Kilwinning, is stark at 24.7 years. The distance between Whitehurst Park and Fullarton is roughly 5 miles, but the difference in life expectancy is almost 25 years. I am sure that everyone in the chamber will agree that that is shocking and that the situation is totally unacceptable.

The reasons for that difference include many factors—among them poverty levels, unemployment and people’s socioeconomic status.

Photo of Chic Brodie Chic Brodie Scottish National Party

On socioeconomic status, last week Labour MPs voted for a welfare cap that locked in the Tory cuts that we know will push 100,000 children into poverty by 2020. How will that affect health inequalities?

Photo of Margaret McDougall Margaret McDougall Labour

SNP members keep talking about what Labour did last week, but we are talking about what is happening today, here in Scotland. They are talking about what Labour did in Westminster; we are talking about what we are doing in Scotland.

According to the Health and Social Care Alliance Scotland briefing, those who live in deprived areas have higher rates of heart disease, obesity, diabetes and problems with drugs and alcohol abuse. It is clear that health inequalities do not stand alone. They are caused, in part, by the socioeconomic inequalities that exist in our society—[Interruption.]

The Deputy Presiding Officer:

I would be grateful if members on the front benches could exchange their views in debate.

Photo of Margaret McDougall Margaret McDougall Labour

In my view, it is our job as elected representatives to eradicate the inequalities that exist in Scotland. This is an issue of human rights and human dignity. To take effective action, we need better collaboration between services in the public and third sectors, promotion of early years intervention and preventative measures, as well as the adoption of evidence-based decision making.

Health professionals, councils, community planning partnerships, the third sector and the Scottish and UK Governments must work together to tackle these issues effectively. An integrated approach is vital to success. In that respect, I welcome the early years collaborative, which is a coalition of community planning partners that aims to deliver tangible improvement in outcomes and to reduce inequalities for Scotland’s vulnerable children, as well as to shift the public services towards early intervention and prevention by 2016. When he sums up the debate, could the cabinet secretary update Parliament on the progress of that initiative and on the difference that it is making at grass-root level?

According to NHS Scotland, adopting early years approaches and preventative measures can be a cost-effective way of tackling the economic, social and environmental causes of health inequalities, and those approaches are better at reducing inequalities than downstream measures such as treating illness. Therefore, adopting holistic person-centred approaches is key to changing behaviours, which in turn reduces health inequalities.

We need an evidence-based policy. For example, the recent NHS Scotland report, “Informing investment to reduce health inequalities (III) in Scotland: a commentary” found that the introduction of the living wage, which the Scottish Government blocked through the Procurement Reform (Scotland) Act 2014, generated the largest beneficial impact on health as well as a modest reduction in health inequalities.

We cannot treat health inequalities as a stand-alone issue. They are complex and tie in to employment, poverty levels and socioeconomic backgrounds, as well as other individual factors. To tackle them, we need collaboration between all services and a focus on early intervention, prevention and changing behaviours. We need to ensure that the most deprived areas in society get the support that they need through a commitment to the living wage in order that we can start to close the gap between the richest and the poorest.

The Scottish Government could do much more with the powers that it already has, not to mention the ones that it will get under the Smith agreement. It is time for it to step up to the plate and to be serious about eradicating inequality in Scotland.

Photo of George Adam George Adam Scottish National Party

I am only too aware of the inequality in my constituency. Like many, I believe that equality and cohesion are good for growth as well as individuals and their families. It is therefore welcome that the Scottish Government’s programme for government focuses on creating a stronger economy and a fairer society. Most of civic Scotland and business organisations have welcomed that.

It is important to keep that balance to ensure that we have a stronger and fairer economy and society. However, as many of my colleagues have mentioned, we do not live in a fair society, because the wealthiest 1 per cent will soon own more than the rest of the world’s population own, according to a study by anti-poverty charity Oxfam, which expects the wealthiest 1 per cent to own 50 per cent of the world’s wealth by 2016.

Kevin Stewart and Ken Macintosh mentioned Oxfam’s seven-point plan on inequality. The Scottish Government has the power to do something about only one of the seven points in that plan; the other six are entirely at Westminster’s behest. We are dealing with that issue at the moment.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

Gordon MacDonald and Nigel Don also raised that issue. Can the Scottish Government take any actions that will have an impact on reducing inequality?

Photo of George Adam George Adam Scottish National Party

That is a rather silly question. The Government is already undertaking a host of initiatives. The problem is the limitations in the devolved settlement. As we examine what comes out of the Smith commission, we have to ensure that the Government gets the powers that it needs to make a difference fully. As I said, out of the seven points that Oxfam mentions, only one is within the Scottish Government’s power. How can we allow that to continue to be the case?

It is no coincidence that the UK Cabinet is full of millionaires. We have a Prime Minister and a chancellor who have personal fortunes of about £4 million but are driving forward policies that target the worst-off in society. I challenge anyone in the UK Government to live in my constituency, receive only hardship payments after having been sanctioned and rely on food banks. I wonder how long they would then think about their welfare reforms. They would look at those reforms from an entirely different perspective.

Most people are not on benefits or living in poverty through choice, just as Mr Cameron and Mr Osborne were not born into privilege through choice. In Scotland, we believe in the getting it right for every child—GIRFEC—principle. No matter where somebody is born in Scotland, they should have the same chances to succeed in life as anyone else and be provided with support and opportunities to ensure that they can achieve all that they can.

The Scottish Government has achieved so much. The opportunities for all initiative will continue to guarantee young people between the ages of 16 and 19 a training or education opportunity—the SNP Government was the first in Scotland to take that action—and the Scottish Government will continue to deliver 25,000 modern apprenticeships per year.

Fee-free higher education for Scottish students ensures that access to university education is based not on the ability to pay but on the ability to learn. Meanwhile, students in England pay fees of up to £9,000 per year. The Scottish Government is protecting the education maintenance allowance for 16 to 19-year-olds and providing record funding for support that is paid to college students. We are working towards a minimum income of £7,000 for the most vulnerable university students. That shows that the Scottish Government has done what it can to help in education.

However, Westminster austerity is making things worse in Scotland. According to the Equality Trust analysis, the UK is the fourth most unequal country in the OECD. The Child Poverty Action Group has estimated that 100,000 more children will be living in poverty in Scotland by 2020 as a direct result of UK Government tax and benefit policies. We have to deal with those issues because our constituents expect us to deal with them.

Families who have access to benefits are only too aware of the dark austerity clouds of the Westminster establishment. Only last week, the Labour Party backed its friends in the Conservative Party on austerity. People in Scotland are now aware of the political games that Labour and the Conservatives play while they are in Westminster. Families in Scotland will be hit by a £6 billion benefit cut in the five years from 2015-16. With nearly 70 per cent of welfare cuts to Scotland still to come, we have not heard the end of that yet.

The Scottish Government mitigates when it can, but why should it have to fix problems that Westminster created? We should be working together to deliver for all our constituents.

When the Labour MPs backed their Tory colleagues on austerity, they left Scotland behind. They left behind 105,000 disabled people, who will each lose at least £1,120 per year because of Westminster welfare cuts, and they left behind the individuals who will be moved from the disability living allowance to the personal independence payment. Disability benefit expenditure in Scotland will be cut by about £310 million. They left all those individuals behind.

When we discuss this issue, we have to look to the future for our people—for the people of Scotland—in order to provide for them, rather than sitting here and continuing to play the typical games that Westminster has played for far too long. Now, thankfully, the Scottish public have become wise to that and are beginning to see that neither of the UK parties has any idea of what it will do in the future.

Photo of Roderick Campbell Roderick Campbell Scottish National Party

Ken Macintosh and George Adam have referred to the Oxfam publication on inequality in the world. The timing of its publication has obviously coincided with the economic summit in that model of equality, Davos in Switzerland.

Nobody should underestimate the extent of the task of tackling inequality or the difficulties that lie in building a more equal society, and nor, as the Health and Sport Committee report makes clear, should we forget that inequalities in one area of life are likely to be closely connected with inequalities elsewhere. Christine Grahame has talked interestingly about the impact of inequality on the prison system. Similarly, we must recognise that changes in the approach to public spending may exacerbate the problem of inequality.

While I accept that it may be simplistic to suggest that, for example, the increasing use of food banks is directly connected to welfare reform and the use of sanctions in the welfare system, I think that the very growth of food banks at least reflects the increasing number of people who are falling through the net.

We have heard much about the growing number of Scottish households that are suffering from changes to benefits or from benefits sanctions or that are on low incomes and require assistance from the Trussell Trust and other food banks. For the almost 10,500 people who received assistance from the Trussell Trust in December, the phrase, “We’re all in this together,” will have a hollow ring.

I commend the Health and Sport Committee for the clarity of its report. It begins by referring to the well-known contrast between life expectancy in Lenzie and that in Calton in Glasgow’s east end. It reminds us that, despite devolution, health inequalities remain persistent and widespread. Many members have referred to comments from Harry Burns and in particular his stark comment that a large part of the population has failed to improve its health at the same rate as the more affluent part of the population has.

I found particularly revealing the fact that public health campaigns on alcohol, tobacco, diet and exercise have had little or no impact on health inequalities. That fact is reinforced by the briefing from ASH Scotland, which refers to the Scottish household survey’s findings that the smoking rate in Scotland’s poorest areas was 36 per cent, in comparison with 10 per cent in the wealthiest communities, and that, although the rate had dropped generally, the gap between rich and poor had not closed significantly. That means that there were proportionately more deaths from smoking in poorer areas—and, of course, smoking cuts the amount of money that is available to low-income families. If smoking rates were reduced accordingly, spending power to purchase other items would increase. That information suggests that public health campaigns need to be better focused, and we should be prepared to make a disproportionate effort to reduce that differential.

In 2014, it was estimated that 427,000 people—18.4 per cent of the workforce—earned less than the living wage. The trend is particularly prevalent among women, with more than one in five women—as against 14 per cent of men—earning less than the living wage in 2014. The continued promotion of the living wage must remain a priority for the Government.

Health inequalities are complex, according to Sir Harry Burns, but there seems to be a consensus that factors such as having a job—preferably one that pays well, having a good income and being well educated all help, and that being poor, unemployed and in bad housing do not.

Looking at the picture on jobs, I was struck by the statistics that the Scottish Government published in July 2014 in its document “Poverty and Income Inequality in Scotland: 2012/13”. In particular, I note the conclusion, to which many members have referred, that 52 per cent of working-age adults on a low income, and 59 per cent of children, were living in households where at least one adult was in employment. That indicates that having a job does not in itself cure poverty.

As the commentary on page 7 suggests, relative poverty increased in 2012-13, which reflected a number of changes,

“such as: changes in the labour market and employment patterns, continued welfare reform (such as tightening of eligibility for tax credits for couples in employment and freezing of some elements of benefits and tax credits) increases in the personal tax allowance and decreases in average earned income in the latest year. These factors have a varying impact on the rate of poverty with some, such as increasing the personal tax allowance, mitigating the impact of others. The net effect, however, is an increase in relative poverty.”

There we have it: increasing the personal allowance is not quite the big Ieap forward that the Lib Dems have suggested; it simply lessens the damage. As Kevin Stewart has mentioned, many commentators have queried the policy’s benefit.

The report makes it clear that, over the past decade, the relative poverty figure decreased from 20 per cent to 14 per cent in 2011-12 before rising again. Importantly, the decreases in 2010-11 and 2011-12 were largely attributed to falling median incomes rather than to any material improvement in people’s lives.

For children, the picture of a fall in child poverty has been reversed. The number of working households with children and in receipt of working tax credits has fallen as a result of tightened eligibility rules and conditions under welfare reform. We are now going backwards.

For pensioners, basic state pension income has increased faster than earnings for working-age households and faster than other benefits and tax credit income, so pensioners’ income has been protected. Overall, they are not doing as badly as some.

For the disabled, as Inclusion Scotland’s briefing makes clear, the welfare cuts have had a disproportionate effect on the disabled people in our community.

Amid all that, median household income is declining. For a small cohort of individuals at the top, things have been getting better. For most others, austerity rules. It is clearly better to make progress on inequality when the economy is growing. Despite comments to the contrary by the UK Government, the UK’s national debt is growing, with public borrowing growing year on year and successive years of triple-digit billion-pound deficits. Even the Prime Minister is warning of a legacy of debt, which I am certain will be one of many epithets that are deployed about his time in office.

The solution cannot be simply to cut public spending more, although that is what the Tories, and now Labour, appear to believe. We must not embrace austerity.

Photo of Cara Hilton Cara Hilton Labour

In Scotland and across the world, inequality is on the up as the gap between rich and poor continues to rise. Oxfam Scotland calculates that the richest three families in Scotland have the same wealth as the poorest 20 per cent combined. It also says that the richest 10 per cent of families have 900 times more wealth than the poorest 10 per cent. The pay gap is so vast that it would take the average worker 158 years to earn what a FTSE 100 chief executive officer makes in just one year. However, while those at the top have seen their income and wealth spiral in recent years, the average Scot is working harder than ever and still struggles to make ends meet.

The cabinet secretary referred to the recent Joseph Rowntree Foundation report that reveals that, across the UK, 8.1 million parents and children are living on incomes below what is needed to cover a minimum household budget. Some of those workers are Scottish Government staff. I highlight a Public and Commercial Services Union survey that has been emailed to us today, which reveals that 40 per cent of PCS members in Scotland do not have enough money to provide for their families.

Many Scots are working in two or even three jobs and thousands of them are forced to get by just on the minimum wage. They often have no choice but to accept zero-hours or short-hours contracts, with hours and pay changing from week to week, flexibility dictated by the interests of the employer and rarely by the needs of the employee, and little, if any, job security.

At a time when the cost of living continues to rise, families on low and average incomes are struggling due to pay freezes and Tory cuts to tax credits and child benefit. Mums are forced to turn to payday lenders, ending up in a cycle of debt from which there is no escape. Every day, too many families in Scotland and across the UK are making the choice between keeping warm and putting food on the table.

A Save the Children survey found that 61 per cent of parents in poverty have cut back on food, with the poorest children missing out on things that other children take for granted, such as a warm coat or going on school trips with their classmates. Despite the fact that the UK is one of the wealthiest countries in the world, at least one in five children grows up in poverty and many more children live in families that struggle to get by week to week. Save the Children forecasts that, by 2020, a staggering one in three children could be in poverty.

The real scandal is that two thirds of children in poverty have mums, dads or carers who are in work but on poverty pay—hard-working families who have been pushed further and further into financial difficulty. They are unable to make ends meet because they are not being paid a living wage. Tackling in-work poverty must be an absolute priority. The Scottish Government is doing a lot on that but it needs to do more. That is why Scottish Labour’s amendment calls for more concerted action to ensure that every worker in Scotland on a public contract is paid a living wage.

It is disappointing that, in many areas where the Scottish Parliament has responsibility, inequality is widening, not narrowing. One of the key factors in that continuing inequality is our education system, which, too often, entrenches disadvantage and inequalities.

I know that, across the chamber, we share concerns that the life chances of too many children in Scotland continue to be determined by the lottery of birth—where they are born and who their parents are—rather than by a child’s efforts at school or their talents. The gap in the attainment levels of children from the richest and poorest households in Scotland begins early in a child’s life and continues and widens throughout their school years. The gap persists when our children leave school and move on to the labour market, or into college or university. It impacts, too, on earning potential and opportunities in adulthood.

By the age of three, children from deprived backgrounds are already nine months behind in average development and readiness for school. By the age of six, low-achieving children from better-off homes start to outperform initially higher achieving children from poorer families. By the age of 11, one in five children from poorer families are not reading well, compared with one in 10 of all children and just one in 20 children from the least deprived areas. Growing up in poverty shapes and impacts on every aspect of a child’s life.

We all know that no child can achieve their full potential when they turn up at school hungry, when they are living in cold, damp, overcrowded housing, when they are stressed and anxious, and when their parents see little prospect of escape from the situation.

Education should be a route out of poverty. It should enable every child to reach their full potential. However, the reality is that thousands of children in our communities across Scotland continue to be caught up in a cycle of disadvantage from which there is little prospect of escape. The gap between rich and poor means that our education system, rather than unlocking potential, often simply reinforces and reproduces inequality. Our education system simply does not work well enough for the most vulnerable children in Scotland, and our attainment gap continues to be wider than that in similar countries across the world.

The Education and Culture Committee is looking at the issue. That is welcome, but it is time for the Scottish Government to do more now with the powers that it already has to tackle the deep-rooted inequality in our schools and ensure that no child is left behind. It is time to spend less time talking about creating an equal society and more time working to deliver one.

The Scottish Parliament already has the power to tackle inequality. I hope that, across the political divide, we can work to get it right for Scotland’s children, because that is far more important than scoring political points. There is plenty of good practice out there. I encourage the Government to look at the steps that local authorities such as Fife Council are taking to tackle the cycle of disadvantage.

One of the most important ways that we can address educational inequality is by ensuring that every child can read well. I commend the excellent “Read On. Get On” initiative, which is aimed at ensuring that every child in Scotland is reading well by age 11. I hope that we can all get behind that campaign. Ensuring that all children are reading well would be a huge step towards a fairer and more equal Scotland in which no child is left behind, in which every child has the opportunity and support to fulfil their potential and in which we ensure that Scotland really is the best place to grow up for every child.

Nelson Mandela said:

“Education is the most powerful weapon which you can use to change the world.”

Those were wise words but, unless we address the inequalities in Scotland’s education system, for too many children in too many of our communities, education will continue to close doors rather than open them.

Photo of Colin Beattie Colin Beattie Scottish National Party

ln whatever guise inequality rears its head, it is one of the most pressing issues that faces our society today. A report that was released just yesterday by Oxfam indicates that, by 2016, 1 per cent of the world’s population will own more wealth than the other 99 per cent. That situation is not only entirely undesirable but, frankly, quite unsustainable. I am sure that we all agree that strong economies are underpinned by fair and equitable societies yet, in a global context, we see a continuation of the exact reverse. Oxfam’s studies show that 3.5 billion people own the same wealth as just 80 people. As recently as 2010, the comparable figure was 388 people.

In the UK context, research by the Equality Trust shows that the richest 100 families have increased their wealth by at least £15 billion since 2008 whereas, in the same timeframe, the average income rose by a mere £1,233. In fact, the research shows that the current richest 100 families own the same wealth as 30 per cent of UK households, which is a sure indicator, if any was required, that Westminster’s austerity measures are doing nothing but making the rich richer and the poor poorer. One concern with such inequality is that the rich continue to strengthen their grasp on power while ordinary people are left with a diminished voice.

As just one example of the methods by which wealth becomes unfairly distributed, the Oxfam report highlights tax avoidance as a major cause for concern. Anders Dahlbeck, a tax policy adviser at ActionAid, estimates that poor nations lose about three times as much to tax havens as they receive in aid. We in the UK are no strangers to tax avoidance schemes, given the recent headline-grabbing stories featuring pop stars, comedians and huge multinational corporations.

The debate allows us to highlight the issues surrounding inequality in a Scottish context. For all Westminster’s talk of improving the lives of the average hard-working person, it is actually doing the opposite. Indeed, last week’s vote to implement £30 billion of cuts clearly displays that the situation will not improve any time soon.

A feature of our times has been the rise of food banks. The Trussell Trust estimates that 13 million people live below the poverty line, which is a scandalous figure in a country such as the UK. In 2013-14, food banks fed 913,138 people across the nation, of whom 330,205 were children. I recently took the opportunity to visit the East Lothian Foodbank and see its work at first hand. I applaud the volunteers who staff food banks up and down the country. I am sure that all members sincerely appreciate the great work that they do but, in this day and age, there should be no need for food banks in the first place.

In these trying circumstances, the Scottish Government is taking positive measures to combat inequality. As a start, the fact that the Government is paying the living wage as part of its pay policy is a clear sign that it is fighting the scourge of poverty from the ground up. What better way can there be to help people than ensuring that they have sufficient money to live a decent quality of life? I sincerely hope that many organisations follow in the Government’s footsteps on that, especially given our support for living wage accreditation. In the future every relevant Government contract will stipulate payment of the living wage as a priority.

Let us not forget that the Scottish Government will ensure that NHS staff continue to receive at least a modest pay increase. Compare that with England, where NHS staff have been badly let down by Westminster. Nursing staff in Scotland could be up to £714 better off annually than staff south of the border.

It is necessary to examine where the Scottish Government is providing support in an educational context. We know how important education is to providing our young people with a head start in life and ensuring that, whatever their background, they have the same opportunity to make the most of their lives as anyone else. I need not remind the chamber that this Government is committed to fee-free higher education, in comparison with the situation south of the border, where students face fees of up to £9,000. Surely we would all agree that if we place a price on education, only those who can afford it will benefit, which thus perpetuates the cycle of inequality.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

Does Colin Beattie not share my concern that, despite the different fee arrangements north and south of the border, more people from an underprivileged background are able to access higher education in England than in Scotland?

Photo of Colin Beattie Colin Beattie Scottish National Party

I have not seen figures that validate that and I would challenge that statement.

In separate measures, this Government aims to provide a minimum income of £7,000 to our most vulnerable university students. Westminster has chosen to scrap the education maintenance allowance that provides funding to 16 to 19-year-olds, whereas we in Scotland have kept that vital source of support. Access to universities has been widened under this Government through the access agreements that were introduced by the Post-16 Education (Scotland) Act 2013.

The results speak for themselves. Our unemployment rate is the lowest of the four UK nations and our employment rate is the highest. Our female employment rate is now at the highest level ever recorded. The council tax freeze alone will save the average band D taxpayer around £1,682 by 2016-17. Our abolition of prescription charges ensures that more money stays in the pockets of ordinary people, compared with the situation south of the border. We are committed to providing free personal and nursing care for our old people, and let us not forget our recent implementation of free school meals for all children in primary 1 to primary 3.

By the end of this year, the UK economy is predicted to be 4 per cent smaller than was expected in 2010. If ever there was a sign that the austerity measures are not working, that is it. Borrowing in 2015 is expected to be £50 billion higher than was anticipated in 2010, which is largely due to real wages being subdued.

I support the SNP Government’s strong commitment to reducing societal inequality, despite the strength of opposition that we face. It is true that we will receive new welfare powers as a result of the Smith commission, which I warmly welcome, but let us be in no doubt—the powers will amount to only 15 per cent of the welfare powers available and will leave the vast majority in the hands of Westminster. It appears to me, and I hope to the Scottish people, that our only solution to end the constant undermining of our efforts to reduce inequality and finally rid ourselves of the damaging austerity agenda is an SNP vote in the coming general election.

Photo of Willie Rennie Willie Rennie Liberal Democrat

I will start with some praise for two of the members whom I might gently call the old stagers, their having been here since 1999: Duncan McNeil and Christine Grahame both made excellent contributions that were thoughtful and quite critical of the Parliament and the two Governments that they and we represented. They reflected the huge challenge that we face in tackling inequality: the fact that it is long-standing and embedded and has blighted many communities for generations. Their speeches were great contributions to the debate.

Nigel Don’s and Rhoda Grant’s contributions were very good as well. They reflected on the interconnected nature of poverty and inequality: the connection, which Christine Grahame also made, between poverty, drink, drugs and prison—a vicious cycle that is very difficult to break. I have only one slight criticism for Nigel Don. He tended a little towards pessimism. I like to believe that we can overcome these huge challenges. Even if they have been long-standing problems, I think that we can overcome them. I know that he started talking about breastfeeding and so on, but I thought that he tended towards pessimism. I am happy if Nigel Don wants to intervene to correct my interpretation.

Photo of Nigel Don Nigel Don Scottish National Party

I am grateful for the mention in dispatches. I am completely optimistic about this, because I think we know what we need to do—but we need the political will to do it.

Photo of Willie Rennie Willie Rennie Liberal Democrat

I am glad, because I think it is important that we have an optimistic view in this Parliament that we can overcome these huge challenges. I know that we all have different views about how we can do that, but it is one of the biggest tests for this Parliament. To be frank, so far the Parliament has not really succeeded in making a sufficient dent in overcoming those challenges.

I was delighted that Margaret McCulloch talked about Suzanne Zeedyk, who has one of the answers—she has talked about communities, families, attachment theory and the fact that too often because of the direction of child protection in society we push children even further away, rather than bringing them closer to us to give them support and encouragement and the emotional intelligence that they require. Suzanne Zeedyk believes that it not just about improving the quantity of childcare—although she believes that that should be increased—but that providing quality childcare is essential to make a big difference and break the vicious cycle that Duncan McNeil and Christine Grahame talked about.

There are other contrasts in this debate. Like a stuck record, we went back to the old argument that we can achieve more things only by having more powers in this Parliament. Duncan McNeil was right that we cannot solve this problem simply by having more money and more powers, but some members seem to be stuck in that argument.

Members will remember that I pointed out in previous debates that, despite the rhetoric of the SNP, it was not promising that one extra penny would be spent on welfare. In its white paper, it was very clear that it would spend exactly the same as Iain Duncan Smith was planning to spend on welfare in 2016-17—not one extra penny. We all understand that there are difficult choices, but the rhetoric needs to match the actions if the SNP’s words are to be believed.

We have heard lots of lambasting of the UK Government and the Labour Party on austerity today, but the Scottish Fiscal Commission is clear: it said that, in order to create the oil fund that the SNP wanted to create, the commission would support a downward trajectory on spending and deficit reduction. That means austerity to everybody else in the chamber.

Photo of Willie Rennie Willie Rennie Liberal Democrat

Not just now.

The reality is that, on austerity as well, the rhetoric is strong but the reality is somewhat different. We have heard about £6 billion cuts on welfare, but the SNP has not promised one penny more. We have heard condemnation of austerity, but the SNP is promising nothing more.

Then there was criticism of the Smith commission, apart from in Colin Beattie’s speech, as he said that he warmly welcomed the new powers on welfare. That was a great, refreshing contribution to the debate, because so many others have derided the Smith commission before the legislation is even published later this week. We will create, for the first time, a £3 billion Scottish welfare system. We will be able to test the rhetoric against the actions, to see whether we do get the changes in policy that the SNP has said that it wants to deliver and whether it finds the money to pay for that—these things all cost money.

We had a contrast in the debate: the contrast between the great, thoughtful contributions of the members who I have already talked about and the rather depressing contributions on welfare, austerity and more powers.

Let us return to the central point. I have Kevin Stewart to thank because we now have clarity that the SNP is opposed to the £800 tax cut that the UK Government has introduced. He condemned it. In fact, Rod Campbell condemned it as well. We can only conclude from that that those members were opposed to it and that they would not have introduced the cut to tax that the UK Government has introduced.

Photo of Willie Rennie Willie Rennie Liberal Democrat

Not just now.

That cut has helped low and middle-income earners by £800 a year, which is a significant benefit to people who are struggling to make ends meet.

We also need to see a greater contribution and a greater effort from the Scottish Government to increase childcare in the same way as the UK Government has done down south. Members should also remember that the national minimum wage is being increased, so there is an extra £355 in the pocket of a full-time worker on the minimum wage. Since the UK Government came to power, 168,000 jobs have been created.

Those are all significant benefits, but none of them was praised by members on the SNP benches. In order to create the fairness that we are trying to generate within society, we need that stronger economy.

I want to finish where Ken Macintosh started off.

The Deputy Presiding Officer:

You have 20 seconds.

Photo of Willie Rennie Willie Rennie Liberal Democrat

He talked about the international challenge. It is worth reflecting that this country is managing to meet the United Nations obligation—the 0.7 per cent of GDP. Every member in the chamber should be proud of the fact that we are contributing to challenging poverty right across the globe.

Photo of Margaret McDougall Margaret McDougall Labour

This has been a contrasting debate of many shades of opinion—some predictable, yet some unexpected and perhaps from unexpected parts of the chamber.

I want to set the backdrop. We are emerging stronger from one of the most significant economic downturns of modern times and the most challenging financial period in 60 years. There are still huge challenges, but today we have a growing economy that is delivering growing employment created from skilled, good quality, full-time jobs. As the minister said, youth unemployment is at a five-year low, and we have rising wages and controlled inflation. That is a solid basis on which to approach the testing and perplexing issue of inequalities.

With the increased income tax personal allowance, people are keeping more of their earnings. That is a tax cut for 2.3 million people in Scotland and it takes 242,000 low-paid workers out of paying income tax altogether. I want to see those numbers increase, as they will from April this year, and go beyond that.

These policies of aspiration and opportunity are how we address inequality. They are in sharp contrast with the Scottish Government’s relentless focus on the paradox that Willie Rennie rightly identified. On the one hand, the Scottish Government indicates in word that it wants a higher, unquantified and apparently uncontrolled spend on welfare, but, as Willie Rennie says, that is never borne out by a specific spend commitment anywhere, such as in its pre-referendum documentation or its welfare commission report. To say that

“there has been very little change in income inequality since 1998” jars with the speeches of many members today, particularly from the Government benches, but that is a direct quote from the Scottish Government’s most recent “Poverty and Income Inequality in Scotland” publication.

Christine Grahame and Duncan McNeil thoughtfully reflected on the long-standing, enduring nature of inequalities, their diverse form and their complexity. I felt that there was an honesty in doing that and recognising that there is no silver bullet. Economic inequality trends are increasingly global, but Scotland has seen less of an increase in economic inequality than other countries. The Institute for Fiscal Studies has acknowledged that

“most industrialised countries saw increases in inequality between the mid 1980s and the late 2000s”.

The Government’s motion also mentions

“£6 billion of welfare cuts”— a figure produced, perhaps inevitably and predictably, by the Scottish Government’s analysis after the most recent budget in July 2014. However, its welfare paper, from where that figure originates, admits that by a considerable margin the biggest saving was made by the changing of the method of benefits uprating from the retail prices index to the consumer prices index. The Scottish Government’s motion is particularly bizarre given that the Scottish Government’s pre-referendum welfare report supported the use of the consumer prices index rather than the retail prices index.

Another large saving that was identified by the Scottish Government’s analysis was from changes to child benefit entitlement. That was a tapered reduction for families where one person has an income of more than £50,000, reducing to zero child benefit for earners over £60,000. I do not recall the SNP campaigning on a platform of restoring child benefit for some of the top earners in our country. I would be interested to hear what it believes the impact of that “cut” has been on inequality.

In combination, those two areas account for more than half of the £6 billion figure. The SNP has not lifted a finger to oppose those savings, and that is true of a number of other changes that fall under the umbrella of welfare reform.

My colleague Mr Johnstone’s amendment also touches on the conclusion of last week’s Finance Committee report. The Parliament voted for £500 million to make a real shift towards preventative spend, which is a good thing, in order to support a transition across public services away from dealing with symptoms of disadvantage and inequality, and towards tackling the root causes, something that we all approve of. Despite that, however, the Finance Committee concluded that the project across the three change funds has produced a “lack of measurable outcomes” and it has expressed “concerns” over a lack of progress.

Therefore, where the Scottish Government has real powers to end inequalities in education and health, to which Christina McKelvie referred, we see a great deal of talk but little achievement. Mr Macintosh rightly referred to education, where we have lost 140,000 college places in Scotland. Further education colleges are a vital component of building vocational skills and allowing people to return to education to prepare them for the workplace. In accessing university in Scotland, the most disadvantaged are now the most excluded and England is doing better than we are in that regard. In health, we have seen not only the problems with the change funds but a real-terms cut to the health budget while the same budget in England is growing.

That is just a reality check, and I know from the murmurs that it does not suit members on the Government benches to hear those observations. I do welcome the Scottish Government’s conclusion that work should be a route out of poverty, and Mr Neil and I agree on that priority. However, the Scottish Government seems to have failed to address opportunity in terms of the opportunities presented by job creation and provided by education and skills, and the opportunity for intervention by the NHS, such as using health visitors and improving health education. Those are issues that are controlled by this Parliament and they directly affect constituents, to whom Margaret McCulloch referred. I have to say that I thought Roderick Campbell made an eloquent plea for those devolved issues, such as health education, to have much more focused attention.

The Scottish Government has become a ritual critic of the United Kingdom Government—indeed, that is the Scottish Government’s default position whenever it is confronted by any challenge—but the reality is an inert, passive Scottish Government, blind to opportunity and failing across a whole range of devolved issues for which it has been responsible for the past eight years. The Scottish Government should take a long, hard, collective look in the mirror and start finding answers.

I support the amendment in Alex Johnstone’s name.

The Deputy Presiding Officer:

I call Neil Findlay—eight minutes or thereby.

Photo of Neil Findlay Neil Findlay Labour

Thanks, Presiding Officer; I am going to give you a recipe, not for a nice cake or dish, but something cooked up by the world’s economic gurus over the past 30 or so years. It is a recipe that has created an economic system by which wealth and power are transferred to, accumulated and then hoarded by a small, rich, powerful elite, while at the same time the mass of people have seen their power, wealth and influence stolen from them.

That system of neoliberal economics is a theory and ideology—and, some might say, a religion—that exists to create inequality; that is its purpose. It is a system in which the market is king, in which competition decides everything and in which global markets are opened up to so-called free trade and only the fittest survive. Of course, Thatcher and Reagan, who were no doubt heroes of Mr Johnstone—I see him nodding in agreement, which is no surprise—were the greatest disciples of this philosophy

Photo of Neil Findlay Neil Findlay Labour

Not just now.

They were true believers in the market’s ability to answer every problem, irrespective of the consequences. In the UK, the Thatcher Government withdrew state subsidy from the car, steel and shipbuilding industries and others, preferring to see people parked on unemployment benefit or incapacity benefit and communities destroyed, rather than the state interfere with her beloved market.

She created a narrative that said that wealth accumulation was how success was measured, and that individualism and materialism were good and collectivism and communitarianism were bad. Unemployment became a method of social control, setting worker against worker in a competition for new, low-paid, deregulated, semi-skilled and unskilled service sector work. Home ownership was promoted as the barometer of personal success. Council housing was sold off at discount and people were encouraged to take on mortgages at four, five or six times their salary, then to use credit cards and loans to finance their lifestyles.

The move from being paid weekly to being paid monthly left many people needing a regular overdraft or exorbitant payday loans to get them to the end of the month. That, along with mass unemployment and a systematic crackdown on organised labour, ensured that nothing stood in the way of the Conservatives’ project. Low-paid home owners who were up to their ears in debt and who feared for their jobs at a time of mass unemployment would not go on strike to defend their jobs and conditions, and those who promoted and created the system knew it.

Our public assets were flogged off to the deregulated City and people made fortunes out of the gas, electricity and telecoms industries that were once ours. All the while, rich individuals, hedge funds and finance houses grew fatter and fatter on the spoils as corporate power milked that approach for all that it was worth.

I say that not to give anyone a history lesson—we all know the story, but today’s debate must be understood in that context. I agree that having a sustainable and secure economy is vital for the wellbeing of society, but what is essential in the debate is that the political will is shown to ensure that the benefits of our economy will be shared more equitably and progressively among all our people, not just those at the top.

Photo of Kevin Stewart Kevin Stewart Scottish National Party

Mr Findlay has given us a wee history lesson, but it is a bit like “Nineteen Eighty-Four” in its rewriting of history, because he forgets the neo-liberal agenda of Blairism. Neo-liberalism was entrenched in Blairism, was it not?

Photo of Neil Findlay Neil Findlay Labour

I did not forget about that, because I was one of that agenda’s biggest critics. The fact that I am prepared to say so indicates the difference between me and Mr Stewart. When my party gets things wrong, I am willing to say so. None of the sheep on the SNP benches is ever willing to do so—look at them. [Interruption.]

I welcome some of the speeches that we heard. I thought that Christine Grahame’s speech was excellent; many of the issues that she raised in relation to prisoners could also be raised in relation to young people who leave care. I thought that Rhoda Grant made an excellent speech on health inequalities. Duncan McNeil’s speech was one of the best that I have heard in the Parliament, and I do not give him many compliments, as I am sure that he will agree—only joking, Duncan. His speech was a challenge to each and every one of us, and I think that we should hear more speeches like it in the Parliament. I also commend Cara Hilton for her comments on education.

Those were serious speeches, but we also had knockabout. Christina McKelvie asked what the most recent Labour Government did for working people and trade unions. Let me tell her. We introduced the minimum wage, brought in the social chapter, extended parental rights, increased compensation for unfair dismissal and established a legal right to trade union representation, and when we are elected in May we will take action on zero-hours contracts, low pay, agency workers, the quality of apprenticeships, blacklisting, bogus self-employment, pay differentials and many more issues on which the trade unions have called for action and have participated in our policy process in writing.

Photo of Christina McKelvie Christina McKelvie Scottish National Party

After that big list of stuff that the Labour Party promised in its manifesto for the last election and did not deliver, perhaps Mr Findlay can tell us specifically which piece of trade union legislation that Margaret Thatcher brought in Tony Blair overturned? Did he overturn any of it?

Photo of Neil Findlay Neil Findlay Labour

If Ms McKelvie looks at her party’s record, she will see that it did not promise to overturn any of that, either; perhaps she should look at her own party rather than criticise others.

Of course, Ken Macintosh was right to challenge the minister—who it appears did not know that the Parliament is to get taxation powers—on whether the SNP will implement a 50p top tax rate. Maybe Mr Neil, as an ex-socialist who once believed in redistribution, will be able to tell us. Maybe he will also be able to tell us whether the SNP believes in the bankers’ bonus tax to fund the youth unemployment initiative or whether it supports the mansion tax to fund extra nurses in our NHS. I think that we know the answer to that—the answer is no. So much for the progressive policies of the SNP. Mind you, it was the back-bench member for Aberdeenshire East who said that he did not mind Thatcherite economics.

We have put forward three policies that would take money from the wealthy to create jobs and put cash into the pockets of working people, and the SNP does not support any of them.

The SNP’s main redistributive policy in recent years has been its policy to cut corporation taxes to a rate that is one of the lowest in the European Union.

That is why we are critical of and sceptical about the Scottish Government’s rhetoric. Willie Rennie was right to point out that not an extra penny was promised in the white paper.

This week, the Scottish Government’s own staff, who work in this building and outside it, will go on strike over low pay. I am glad that the culture secretary is here; a dispute has been going on in her directorate for more a year over the £3,000 in weekend allowance payments that has been taken off the lowest paid staff, and nothing has happened for a year. Only today, as Cara Hilton said, PCS highlighted that Scottish Government staff are relying on credit and food banks to get through the month.

We need a change of philosophy and approach across Government to tackle the issues.

Photo of Alex Neil Alex Neil Scottish National Party

First, let me say to Willie Rennie that although Roseanna Cunningham and I are members of the 1999 group we would not describe ourselves as “old stagers”. Let me also say that Mr Findlay might call me an ex-socialist, but he is just ex as far as I am concerned.

The Government will not accept any of the amendments to the motion.

There is a degree of unanimity in the Parliament, in that I think that we agree that the level of poverty in Scotland—and elsewhere in the UK and the wider world—is totally unacceptable. Members mentioned the statistics for Scotland, including that 1 million people, or 19 per cent of the population, live in poverty, but something that no one mentioned is that 230,000 of those people are in severe poverty. Some 59 per cent of children in poverty are in a household in which someone is in work, and many members of our disabled community, which has suffered most in recent years, are living in poverty.

Photo of Alex Neil Alex Neil Scottish National Party

I will do in a minute.

Whether we are talking about measures of the gaps in educational attainment or life expectancy between the wealthier and poorer parts of our society, I hope that we all agree that it is unacceptable that the UK, which is the fifth or sixth largest economy in the OECD, ranks fourth on level of poverty. It is totally unacceptable that an economy as rich as the UK has the fourth highest level of poverty of all the OECD countries.

Photo of Kenneth Macintosh Kenneth Macintosh Labour

There has been broad agreement in the debate about the problem of inequality in this country and our desire to tackle it. Labour members are prepared to vote for the SNP motion; what is wrong with the Labour amendment that means that the SNP will not vote for it?

Photo of Alex Neil Alex Neil Scottish National Party

A number of things are wrong with it. I will come on to that.

We must consider why poverty has got so much worse over the past few years. I must say to the Tories and the Liberal Democrats that they bear responsibility for that. There are four or five major contributing factors, which I will go into later.

It is easy to bandy about statistics and make points about various measures, but at the end of the day poverty is about human misery. I—like many members, I suspect—can reel off hundreds of examples of constituents who have come into my surgery to tell me about the desperate financial state in which they and their families find themselves.

Quite recently I had a visit from a single mother, whose three children all have autism. The Department for Work and Pensions had left her with £18 that week to look after herself and the children. That is unacceptable in 2015. We were able to get her to a food bank and to get emergency money to see her through the weekend, and we were able to get her fixed up with welfare rights, to see whether she was getting everything that she was entitled to. Because of various measures that the Department for Work and Pensions had taken, the family had been left with £18 to live on.

There are too many examples of that. George Adam referred to the implications and the consequences of sanctioning by the Department for Work and Pensions. The sanctioning of people who are already down at heel in terms of their income and their ability to make ends meet from week to week is now a major cause of short-term poverty in Scotland. I hope that, when additional powers over welfare are transferred to us, we get control over issues such as that, because those issues are causing much hardship to our people.

Most of the benefit changes that have been made in recent years have been not reforms but cuts to benefits for the most vulnerable members of our society. That has been a major contributing factor to the increase in poverty. The fact that the minimum wage has not kept up with inflation is a major contributing factor to in-work poverty, and that has been the case under both Labour and the coalition Government. Public spending cuts, cuts to housing and cuts to a range of policy areas that have been passed on to Scotland have been a major contributing factor to poverty.

Photo of Alex Neil Alex Neil Scottish National Party

I will later.

It is utterly deplorable that the Labour Party joined the Tories and the Liberals in voting for another £30 billion of cuts on top of the existing cuts. I hear Ken Macintosh and Neil Findlay pay lip service to the poor, saying that they care about them, but if they care about the poor they should condemn the vote that took place in the House of Commons the other night.

Photo of Alex Johnstone Alex Johnstone Conservative

Is it not ironic that the cabinet secretary talks about cuts to the housing budget when his own Government sought to target the housing budget for disproportionate cuts year on year and only the Barnett consequentials allowed him to reverse part of those cuts?

Photo of Alex Neil Alex Neil Scottish National Party

The only thing that has been targeted for disproportionate cuts is the block grant from the Government at Westminster to the Scottish Government. We have seen our capital budget sliced to ribbons and cut by 26 per cent over recent years, while the resource budget has been cut in real terms by 10 per cent. If our resource budget is cut by 10 per cent and our capital budget is cut by 26 per cent, we have to live within our means. If it had not been for all the work of John Swinney, the Scottish Futures Trust and all the other initiatives that we have taken, we would not be building the number of houses that we are building now in Scotland every year.

Photo of Alex Neil Alex Neil Scottish National Party


I want to mention the income tax cuts. The Tories and the Liberals make a big issue of the increase in the personal allowance, but they forget to tell us that, on the day that they started to increase the personal allowance, they increased VAT from 17.5 to 20 per cent. That is a regressive tax that hits the poorest more than the wealthiest. The Liberals and the Tories have no excuse. The impact on poorer people of the rise in VAT has been far greater than the benefit from any increase in the personal allowance.

That has been the reality over the past four or five years under the coalition and over the previous 13 years. Kevin Stewart was a bit inaccurate when he said only that Blair was a guru of what Mr Findlay called neo-liberal economics. Blair was not the only such Labour guru: Gordon Brown was a neo-liberal economist, Peter Mandelson was a neo-liberal economist and Jim Murphy was a neo-liberal economist. We will not take any lessons from Labour. The only person in the Scottish Labour Party who is not a neo-liberal is Katy Clark, who courageously voted against the cuts the other night in the House of Commons. Unlike Mr Findlay, she has stuck to the promises that she made in the Scottish Labour Party leadership election.

The other parties ask what we are doing to tackle poverty. I will remind the chamber what we are doing in that regard. We are implementing the living wage and the pay rise for National Health Service workers; we will spend almost £300 million on mitigating cuts in welfare; we are investing in public services; we have free prescriptions, free school meals and free higher education; we are keeping the educational maintenance allowance; we are increasing childcare provision and the eligibility for that provision; and we have GIRFEC and modern apprenticeships. We are also doing a whole range of other things.

The other parties pay lip service to poverty and inequality; we act on poverty and inequality.