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Programme for Government 2018-19

– in the Scottish Parliament on 5th September 2018.

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Photo of Linda Fabiani Linda Fabiani Scottish National Party

Resumed debate.

We continue the debate on the Scottish Government’s programme for government 2018-19.

Photo of Derek Mackay Derek Mackay Scottish National Party

This year’s programme for government is focused on the wealth and wellbeing of our communities. As economy secretary, and having engaged comprehensively over the summer months, I relish the opportunity ahead.

The PFG has a strong emphasis on boosting our economy. We will increase investment in Scotland’s infrastructure so that it is £1.5 billion per year more by the end of the next parliamentary session than it is in 2019-20. That increased investment, which is the most ambitious long-term level of infrastructure spend that Scotland has ever seen, will drive connectivity, create jobs and deliver a long-term boost to productivity. In total, that means around £7 billion of extra infrastructure investment over the period, to help us to support faster broadband, improved transport and more low-carbon energy.

In a further, transformational move, we now embark on the legislation for and capitalisation of the Scottish national investment bank. Today, I launched a consultation on how the bank can support Scotland’s economy. We will listen to views from across Scotland on the bank’s objectives, purpose, priorities for investment and governance. This is a game changer in the provision of patient capital to finance innovation and growth, which will be pivotal in our ambitions for a future-proofed, high-tech, low-carbon Scottish economy

Photo of Jackie Baillie Jackie Baillie Labour

I managed to have a very quick look at the cabinet secretary’s consultation. Something like £30 million seems to be set aside for staffing and the Scottish Government has not excluded the payment of bonuses. Will the cabinet secretary do so now?

Photo of Derek Mackay Derek Mackay Scottish National Party

It would be wrong to prejudge every element of the consultation; naturally, we want to hear from stakeholders. However, I will not follow the worst practices of the banking sector in that regard. We will build a bank of which Scotland will be proud.

This year, we will also begin our reaching 100 programme, delivering a £600 million investment to make superfast broadband available to every home and business in Scotland and ensure that the whole country can reap the benefits of the digital revolution.

O ur investment for the future will make Scotland an even better place in which to live, work and invest. It will be more competitive internationally and it will attract talent and investment from around the world. There will be investment at home and a determination to boost export opportunities. That is why we are investing £20 million to help more of Scotland’s businesses to engage with e-commerce for export, to support existing exporters to ramp up overseas activity, and to set up a new scheme that creates business-to-business peer mentorships, so that new exporters can learn from established exporters.

Businesses across Scotland told us that they want a more streamlined business support system, which is why we are developing a single digital point of entry for business support, along with quicker, technology-driven decisions on financial support. We are also introducing criteria to ensure that business support grants such as regional selective assistance deliver on our ambition to be a world-leading fair work nation. In the coming months, our enterprise and skills agencies will also be stepping up their support for businesses to navigate through Brexit.

We moved swiftly to implement the Barclay rates review recommendations and will now introduce a non-domestic rates bill to implement the remaining legislative elements, such as moving to a valuation cycle that better reflects property values and delivers incentives for growth.

Our economic actions will touch every part of Scotland. We have committed to investing more than £1 billion in city region deals, which will create thousands of jobs and upskill local labour markets across Scotland. Beyond our cities, we will legislate to establish a south of Scotland enterprise agency that supports a diverse and resilient economy in the region.

Despite the United Kingdom Government’s Brexit bungling, Scotland’s economy has proven to be resilient, and is benefiting from the Scottish Government’s progressive initiatives. During the past year, economic growth, or gross domestic product has been higher than in the rest of the UK, and I look forward to the Opposition parties welcoming that.

Photo of Derek Mackay Derek Mackay Scottish National Party

Of course. This must be the welcome.

Photo of Murdo Fraser Murdo Fraser Conservative

Did the cabinet secretary note the Scottish Fiscal Commission’s report that came out this morning? It talks about GDP growth in Scotland. The commission says:

“These revisions don’t in our view affect the subdued outlook for trend growth.”

Perhaps the cabinet secretary is getting carried away with his enthusiasm a bit too soon.

Photo of Derek Mackay Derek Mackay Scottish National Party

I am just enthusiastic because we are outperforming the United Kingdom.

Photo of Derek Mackay Derek Mackay Scottish National Party

One is plenty for the moment, thank you.

Our economic growth outperformed that of the United Kingdom over the past year and specifically in the last quarter. We outperformed the UK in reducing youth unemployment. Women’s unemployment is lower in Scotland than in the rest of the UK. Overall unemployment remains at near record low levels. Scotland has narrowed the productivity gap with the rest of the UK over the past decade. Exports are up 12 per cent in the past year.

The measures in the programme for Government will deliver a step change in infrastructure and business support. It will deliver for the economy of today and lay the foundations for the opportunities of the future. I look forward to the debate ahead.

Photo of Murdo Fraser Murdo Fraser Conservative

In her statement to Parliament yesterday, the First Minister started by talking about Scotland’s economy. Sadly, there is very little in the programme that would help to grow Scotland’s economy, but let us look at what is on offer.

Rather predictably, we heard all the usual negativity about the likely impacts of Brexit on the Scottish economy. Then, in a statement demonstrating a fairly astonishing lack of self-awareness, even for the current First Minister, she went on to trumpet the increase in the export of goods from Scotland by 12 per cent, which is a significant figure. It does not take an economic genius to understand that a principal reason why exports have grown so dramatically in Scotland and across the UK, has been the fall in the value of the pound against other currencies during the past two years. That fall is a direct result of—guess what—the Brexit vote. The very problem area that the First Minister has identified for the economy is delivering the dramatic export growth that she champions.

Another sector in Scotland that is booming is tourism, to the extent that some parts of the country are even talking about the problem of overtourism. Holidaying in the Highlands this summer, I was pleased to see the large number of overseas visitors from Europe coming to enjoy our scenery, culture and hospitality, and all benefiting from a favourable exchange rate. Similarly, more UK visitors are staycationing to take advantage of the good weather and the more competitive costs of holidaying at home.

I accept that the very Brexit that has created boom conditions in industries such as tourism has, of course, presented challenges. There are hospitality providers that are struggling to recruit staff from European countries because it is no longer as financially attractive as it used to be for those workers to come here, and the same situation applies to other industries, such as agriculture. However, to suggest, as the First Minister did, that the impacts of Brexit thus far on our economy have all been negative is simply to dismiss the evidence that we have before us.

What is in the programme for Government to help the economy? There is legislation to establish the south of Scotland enterprise agency. That is a policy that we welcome—indeed, it is a policy that was pinched from our 2016 manifesto. There is to be a new bill on non-domestic rates to implement some of the recommendations of the Barclay review, and much of that is welcome. The relief for new-built properties and property improvements will help to grow the economy. The exemptions for day nurseries are also welcome. Some of the process issues, such as the move to a three-year cycle for revaluations, will also be beneficial.

However, it remains our view that the Barclay review was a missed opportunity for a more fundamental review of business taxation in Scotland. In particular, retail continues to suffer as a sector, with pressure on traditional high streets. The large-business supplement, which is set in Scotland at a rate that is nearly double that which is applicable in the rest of the United Kingdom, continues to be a burden on Scottish retailers and creates a competitive disadvantage for Scottish traders. That needs to be addressed.

The non-domestic rates bill will no doubt address the issue of rates on independent schools with an intention of implementing the Scottish National Party’s policy objective of removing the current exemption. It has always seemed to me to be totally illogical that the same Barclay review that proposes a new exemption from business rates for children’s nurseries that provide education, many of which charge fees and are profit making, at the same time proposes removing a business rates exemption from independent schools, which are charitable institutions not making a profit. It is an approach that is as bizarre as it is illogical.

Already, the real problem has developed in relation to the range of independent schools that provide specialist support for children with additional support needs, such as the new school at Butterstone in Perth and Kinross, which will be hit with business rates unless a way can be found to exempt it. It will undoubtedly be a challenge to parliamentary draftsmen to draw a distinction in law between independent schools that provide a general education but have some pupils with special needs and independent schools that are set up for the almost exclusive use of pupils with those needs.

This is not just an issue of education; it is also an economic issue. In Perth and Kinross, there are at least eight independent schools that I am aware of. They make a significant contribution to the local economy, supporting around 500 direct jobs and many more indirect jobs in the wider economy. Of course, the schools represent a major source of foreign revenue from students coming from overseas. To hit that important economic sector with a new tax burden flies in the face of everything that we have been told by this SNP Government.

Photo of Murdo Fraser Murdo Fraser Conservative

I will finish this point and then give way.

The Deputy Presiding Officer:

You are in your last minute, so you will have to be quick.

Photo of Murdo Fraser Murdo Fraser Conservative

Yesterday, the First Minister said:

“We will ensure that the business environment in Scotland remains competitive and that we are providing the support that businesses need to thrive.”—[

Official Report

, 4 September 2018; c 16.]

Apparently, however, not these businesses.

Photo of Derek Mackay Derek Mackay Scottish National Party

Is Mr Fraser aware of the proportion of the overall running costs of an average independent mainstream school that non-domestic rates relief represents?

Photo of Murdo Fraser Murdo Fraser Conservative

I do not have the figure at my fingertips but I can say that to add an additional burden of—I think—£5 million to a sector that is educationally and economically important flies in the face of everything else that this Government has done to set about growing the economy.

It seems that the education secretary, who has now left the chamber, recognises that there is an issue because he wrote to the finance secretary over the summer to raise the concerns. What was the response of the finance secretary? It was to suggest that the local authority, Perth and Kinross Council, could somehow find the money in its budget—a budget that he and his predecessor had slashed—to make up the difference.

We have had to sit in this chamber month after month, year after year while SNP ministers complain that they have to use their resources to mitigate the policy choices of the Westminster Government on welfare and elsewhere. However, here we have SNP ministers having the brass neck to play exactly the same trick on local authorities that they claim that Westminster is playing on them. Was there ever anything quite so shameless?

This is an unambitious programme for government. It is indicative of a party in government running out of ideas, lacking in enthusiasm and short on ambition. The Government really must do better than this.

Photo of Stewart Stevenson Stewart Stevenson Scottish National Party

That was an interesting opening observation from the Conservative benches. It is the first time that I have heard Murdo Fraser boast that the pound in his pocket is worth less than it was worth before Conservative policies and actions affected it. I will welcome hearing what he says in two years’ time when the effect of higher costs for importing components that are required for manufacturing industry in these islands hits home. There is a short-term benefit, but the long term is much more problematic. We should talk about Brexit in relation to the economy. It is a huge challenge to the Scottish economy and the economy in these islands, but it will not inhibit the Scottish Government from taking the actions that will support Scotland’s further development.

I will say a few words about a few of the announcements in yesterday’s statement from the First Minister. Before I talk about banking, I remind members of my entry in the register of members’ interests. I spent 30 years in banking and came into politics to improve my reputation.

I strongly support the establishment of the Scottish national investment bank. The way that the world of finance and cash works is changing fundamentally for businesses and will do so even more for individuals. For example, in Sweden, there are now only 25 bank branches that deal with cash because the society has, in essence, become cashless. We will get there as well. The Scottish national investment bank, which will focus primarily on investment in the first instance, could in the longer term consider how we support communities that will lose more and more local branches—as they are already—so that the right kind of financial services are available. That will often be through technology assisted by trained people.

I welcome the proposed biometrics bill. I encourage the Government to pay close attention to what has happened in India with the Aadhaar system. That is an identity card system that has issued cards to 1.22 billion cardholders since 2009. An important point about it is that around 50 per cent of the cardholders are functionally illiterate. Therefore, it is an easy-access system and it has many lessons for what we might want to do on biometrics. The Aadhaar card is based on retinal scans.

I will say a wee thing about electoral reform. I hope that we can persuade the Boundary Commission for Scotland to give us more granular detail when it makes boundary changes so that we can see what houses are at the edges of our constituencies. It is not a big deal.

On non-domestic rates, I would like the Government to work with the assessors on how they factor empty premises into the assessment of the value of rents. In the north-east of Scotland, quite a lot of fish factories are empty. The actual rents paid are taken into account for the ones that are occupied, but no account is taken of the fact that it is impossible to let other factories at that rate of rent. The assessment should be made across the board. The valuers know about the empty factories because they consider them as well. I will talk to them about it because I realise that the Government does not control that subject, although it provides guidance.

I warmly welcome the increased investment in infrastructure. I hope that we will think about whether we can support industries that will be particularly hard hit by the absence of workers from Europe when people go back to Europe because of the immigration rules. Perhaps we can help the fish processing industry to increase its levels of automation and the soft fruit industry to develop new technologies for harvesting. In turn, that would create new products that we could sell around the world. I hope that those ideas will be considered for inclusion in the infrastructure investments. Of course, it is up to the industry to come forward with proposals and I have been talking to people in both of those industries about what they might do in that regard. That is about middle-term to long-term investments rather than short-term ones, but it is important nonetheless.

If you will allow me, Presiding Officer, as there is no motion, I will pick up on one thing that is not directly to do with the economy but which I am particularly interested in—the announcements in relation to mental health. In 1964, I worked in mental health as a nurse for eight months. My father-in-law is a psychiatric nurse and my sister-in-law is a psychiatric nurse. I am absolutely clear about the value of investing in people’s mental health and of helping people with early signs of mental ill-health in schools. That mental ill-health might otherwise develop into a real cost to the economy—to come back to that—but, more fundamentally, investing in mental health will benefit people in Scotland: it will improve their lives, not just their wallets.

Photo of Jackie Baillie Jackie Baillie Labour

I have to confess that the First Minister’s programme for government sounded to me like a bit of a shopping list. There was no story—there was no consistent thread underpinning what the Government is doing—and I was left not really knowing the big picture. There was a lot on inputs but very little on outcomes.

When we look back at the previous programme for government announcements, the charge that the SNP overpromises but underdelivers is absolutely true. Only two bills were passed last year. If ministers’ salaries were based on performance-related pay, they would have them docked. I accept that it is not just about legislation but is also about what the Government does with policy and with the budget. The problem is that the SNP has been timid on all those fronts. On every measure and every target that the Government set for itself on the economy, it has failed. Just look at the seven purpose targets that relate to the economy—not one of them has been met.

I welcome the renewed focus on the economy because I have no doubt that it is badly needed. I particularly welcome the announcement that there will be a new economic strategy—not before time. Scottish Labour has asked several times for the economic strategy to be reviewed. We asked the First Minister and the cabinet secretary for the economy to review it in 2015, in 2016 and in 2017. Members might think that Brexit is a sufficiently material and significant change for the SNP to want to make sure that its strategy is fit for purpose, but no. On at least three occasions, the SNP voted against a review. I am really glad that the new cabinet secretary does not have his head in the sand like his boss or his predecessor.

The second issue for me is honesty about the state of the economy. Of course the Government will claim that everything is wonderful and the Opposition will claim that everything is dire. The truth is that our economy is fragile. I think that everyone in the chamber would welcome any rise in GDP. I want our economy to grow. I want us to generate jobs and generate wealth and then to redistribute that wealth to those who need it most. However, members should not expect me to jump up and down at marginal rises that are fractions of a percentage point. Forecasts by the Scottish Fiscal Commission show growth sitting at less than 1 per cent for a year longer than it originally thought—to 2023. That is not a good story. I want us to do much better than that.

I say as gently as I can to the cabinet secretary that, if the limit of our ambition is to compare ourselves with the UK just when the UK is performing badly, that is not very clever, nor is it very ambitious.

Photo of Jackie Baillie Jackie Baillie Labour

Let me make progress and then you can come in.

Let us compare the state of the Scottish economy with the position of some of our European neighbours. I remember that the SNP used to talk about emulating the Celtic tiger—that was until the Irish economy tanked. However, from 2015 to the first quarter of 2018, Ireland has outperformed Scottish GDP growth in 11 of the 12 quarters.

Photo of Jackie Baillie Jackie Baillie Labour

I hear somebody shouting, “Independence.” Actually, this is about a significant recession and what they did in Ireland did not require independence; it required determined effort.

I will talk about Spain and the great recession that lasted until 2015. Unemployment was 20 per cent, but now Spain has outperformed Scotland in each and every one of the 12 quarters. Portugal’s unemployment reached 18 per cent and the European Central Bank had to intervene, but its growth has been higher than Scotland’s in each of the past 12 quarters. It is interesting that the Socialist Government in Portugal has explicitly rejected austerity and is turning its country round. I invite the SNP to learn a lesson or two from Portugal.

I am encouraged by the new focus on export as too little has been done in that area in the past. I note that we export more to the rest of the UK than we do to the rest of Europe and the world, so strengthening our home market is as important as looking further afield. However, where is the focus on productivity? It is a key driver for economic growth but there was no mention of it in the First Minister’s 45-minute speech. Productivity in Scotland is woeful. The Government had a target to be achieved by 2017 to lift it to the top quartile of Organisation for Economic Co-operation and Development countries. We started at 18th place in the second quartile. By 2017, we had slipped to 19th place in the third quartile, which is frankly dreadful.

Photo of Derek Mackay Derek Mackay Scottish National Party

Jackie Baillie rightly said that we should not match Scotland just to UK performance—which we are outperforming, of course. However, when we consider small advanced economies that are more successful than Scotland, we have all the economic fundamentals that they have. The one thing that they have but we do not is independence. Why does Jackie Baillie stand in the way of Scotland’s economic progress?

Photo of Jackie Baillie Jackie Baillie Labour

That question is interesting, because the SNP cuts commission report spelled out the situation. With independence would come years of austerity with eye-watering cuts to public services, schools and hospitals. That is why we reject the SNP’s flawed notion of a thriving economy.

Where is the focus on workers? I think the Government would acknowledge that much of the recent rise in employment has been characterised by temporary working, low pay and zero-hours contracts. Just the other day, a report highlighted the millions that would be injected into the economy in the west of Scotland and Glasgow in particular if more people were on the living wage.

I welcome the eighth reannouncement of the Scottish national investment bank, but I am disappointed at the suggestion that it will pay bankers bonuses. I hope that that is not the case. Under Scottish Labour’s plans, we would see £20 billion invested, which is 10 times the amount proposed by the SNP, because we need to see transformational change.

On infrastructure investment, Scottish Labour has asked for many years for the Scottish Futures Trust to be reviewed to secure better value for money. We would deliver £20 billion in capital investment from a national transformation fund, in contrast with the SNP. The Scottish Government has new borrowing powers of £450 million each year, but how much of that will be used to fund the £1.5 billion that has been announced? How much will come from the private sector?

The Deputy Presiding Officer:

You must close, please.

Photo of Jackie Baillie Jackie Baillie Labour

How much is assumed investment made by local authorities? We look forward to considering those questions and the funding model in further detail.

The Deputy Presiding Officer:

I remind members that they should always speak through the chair and not directly to one another.

Photo of Andy Wightman Andy Wightman Green

It is worth reflecting, as Richard Leonard did yesterday, that next year will be the 20th anniversary of this Parliament. Despite our political differences, it is worth celebrating the fact that we have the capacity to introduce new laws and policy for the people whom we serve. Examples of welcome legislation in the programme for government include bills on consumer protection, electoral reform and family law, and there is the welcome announcement that the Government will introduce a bill in this parliamentary year to reform the law of defamation—I commend Scottish Pen and others for their campaign on that matter.

With regard to policy, we welcome plans for a Scottish national investment bank—as many others have—and the launch today of the consultation. The bank could have a transformative impact on the economy if it is designed and implemented appropriately. We welcome ambitions for infrastructure investment, but we reiterate our calls for it to be focused on low-carbon projects, public transport and public housing.

Today’s debate is themed around the economy. As a number of speakers have mentioned, we continue to have fundamental problems with the economy. As Greens, we have fundamental problems with the assumptions that underpin the Government’s economic policy. Economic growth, even inclusive economic growth, is a fundamentally flawed goal, if measured by gross domestic product, which is the aggregate of monetised transactions in the economy. The founder of GDP in the 1930s was Simon Kuznets, who became one of its biggest critics. GDP does not measure goods and services that are produced in the course of daily life. It does not measure the distribution of income or wealth—in fact, it says nothing at all about wealth. It ignores environmental services from soils, oceans and forests and says nothing about energy flow. The idea that GDP growth is central to the measurement of the success of an economy is, in the words of one of the authors of the 1972 report “The Limits to Growth”,

“one of the stupidest purposes ever invented by any culture”, yet it persists. Scotland’s economic policy will be deemed a success if, for example, the oil and gas sector continues to extract more hydrocarbons, despite the imperative to leave the vast majority of known reserves in the ground.

The Deputy Presiding Officer:

Who are you taking, Mr Wightman?

Photo of Tom Arthur Tom Arthur Scottish National Party

Notwithstanding the points that Mr Wightman makes, many of which I am sympathetic to, will he concede that there is a correlation between per capita GDP and human wellbeing?

Photo of Andy Wightman Andy Wightman Green

There certainly is an indication that there is such a correlation, but it is not the basis on which we need to build a sustainable economy, because that correlation is not absolute.

The economy of Scotland, like the wider UK economy, is still too heavily weighted in favour of financial services and is dangerously dependent on consumption, which continues to be fuelled by high levels of household debt, with a generation of young people facing excessive housing costs, job insecurity and lower living standards. Today, the Institute for Public Policy Research published the final report of its commission on economic justice, which contains some of the ingredients for a successful economy, and I would welcome the Government’s response to the recommendations for Scotland.

Green politics are based on the four pillars of equality, peace, environmental sustainability and radical democracy. In our view, to secure the changes that the economy and society need, people need the power to make those changes. Across Europe, cities and municipalities are leading the way on sustainable transport, clean air, affordable housing and tackling climate change. By and large, they can do so because they have the required legislative and fiscal power. They are drivers of economic activity, innovation and sustainable futures.

That is why it is so disappointing to see the programme for government perpetuate an unambitious agenda to reform the way that Scotland is governed at a local level. We need to provide a more local and participative local democracy with commensurate fiscal powers to create genuine local autonomy. Out of 118 pages, there is a quarter of a page on the local government review, with no ambition or ideas about how Scotland can become a normal European country in respect of how we are governed locally. Modest proposals for the tourist tax, which are commonplace across Europe, are kicked further down the road, although there was welcome confirmation today from Kate Forbes that such powers will be considered as part of budget negotiations.

Taxation is a critical part of economic policy, and the programme refers to that on page 61. Given that the second-highest-yielding tax in Scotland is non-domestic rates, we welcome the proposal for a bill on that matter. However, the thorough and comprehensive review of the business rates system that Derek Mackay promised as far back as 2013 was never delivered; instead, we had the Barclay review, which asked one question and was told to make its recommendations revenue neutral. In practice, that meant that any proposals that were made to reduce liabilities in a sector had to be balanced by measures that would make up for the lost yield, which is why we have proposals to raise liabilities in other sectors. That is not the way to do tax reform.

Earlier this week, we lost the Nobel prize winner Professor James Mirrlees, who was one of the Scottish Government’s economic advisers. In his Mirrlees review of 2011, which was a comprehensive look at the tax system, he said among other things:

“The business rate is not a good tax.”

He went on:

“Taxing non-domestic property is inefficient, and should not be part of the tax system.”

However, he also said:

“The economic case for taxing land itself is very strong”.

On stamp duty, he said:

“There is no sound case for maintaining stamp duty and we believe that it should be abolished.”

The Government might ignore those wise words from one of its advisers, but Greens will not. We look forward to working with parties across the chamber to secure some of the changes to fiscal policy that James Mirrlees advocated. We also look forward to working with the Government and other parties to take forward some of the very good ideas in the programme for government.

Photo of Liam McArthur Liam McArthur Liberal Democrat

It was interesting to listen to the First Minister deliver her statement yesterday. Partly, that was because of what she had to say, which I will come to in a minute, but it was also because of the way that her statement seemed to be received on her back benches. Those of us who have been members of Parliament over the past 11 years have got used to the raucous adulation that normally greets such first ministerial set pieces—the oh-so-spontaneous rounds of applause in response to carefully crafted clap lines and the pantomime booing of those deemed unworthy of the people of Scotland. It was not so, yesterday; it was all rather muted, a bit low key and something of an anticlimax.

That is not to say that there were not positives in what the First Minister had to say and things that I warmly welcome. Guaranteeing the voting rights of European Union citizens in this country was an early and obvious example, and so too was the confirmation that the principles of the United Nations Convention on the Rights of the Child are to be incorporated into Scots law. I was on the Education and Culture Committee in the previous parliamentary session, when the SNP Government used its parliamentary majority to frustrate any attempts to move in that direction during consideration of what was to become the Children and Young People (Scotland) Act 2014. Nevertheless, the rethink by the First Minister is welcome, significant and potentially far reaching.

That same description applies to the additional funding that was announced yesterday for mental health. That the announcement came on the same day as figures showing the staggering scale of how far we currently are from meeting the needs of people of all ages—but particularly children and young people who are suffering from poor mental health—only served to underscore how vital that long-overdue investment is. The funding must now prompt a substantial increase in the training of specialist practitioners. Just expecting the teaching profession to pick up the pieces will not do. Ensuring improvements in provision across the whole country, including in rural and island areas, will also be essential. However, the funding lays a good platform and it must now pave the way for treatment of mental ill health to be put on the same statutory footing as treatment of physical ill health.

Therefore, there were positives in what Nicola Sturgeon had to say yesterday, but sadly there were too few in a statement that went on for 40 minutes or more—not that I was desperate to hear her go on any longer.

I was struck by some of the bills that were conspicuous by their absence. The good food nation bill appears to have been boiled down to a mere programme. Richard Lochhead might be flavour of the month again with the First Minister, but the bill that he spent so much time evangelising has been dumped in the compost bin. With major challenges such as food poverty, childhood obesity and even biodiversity loss, it is hard to understand why the Government has scaled back its ambitions in that area.

There was no sign of the much-needed crofting reform bill to address the growing frustration and anger at the current regulation, which is not fit for purpose and is holding back individuals, businesses and communities, including those in places such as Orkney. Also missing in action yesterday was any mechanism for undoing the mess that the Government has got itself into over the dismantling of the British Transport Police. Those are just some of the examples of where the First Minister’s programme for government fell short and represents a missed opportunity.

We did, however, get some signs as to what we might expect from the Government’s forthcoming budget bill, though we will have to wait a bit longer for the full reveal. In the remaining time that I have available, let me gently remind the finance secretary of other commitments that he has made that will also need to be accommodated when that bill is introduced.

Much was made yesterday of plans for investment in infrastructure, which have been repeated by Derek Mackay. However, it was difficult to identify much of direct relevance to more rural and island areas. Last year, the Scottish Government finally agreed to begin honouring the promises that it had made—through successive transport ministers, including Derek Mackay—on funding for Orkney and Shetland’s internal ferry services. That principle has now been accepted. There cannot be any rowing back. Any attempt to do so would be seen by those in Orkney and Shetland as an act of betrayal by the Government.

Photo of Stewart Stevenson Stewart Stevenson Scottish National Party

Does the member agree that a huge majority of the £600 million that will be invested in the reaching 100 per cent broadband coverage programme is directed at rural areas? I will be a personal beneficiary and I am looking forward to it.

Photo of Liam McArthur Liam McArthur Liberal Democrat

I agree

, although there are serious questions about deliverability in parts of my constituency. I appreciate the engagement that there has been through the digital Scotland team in trying to answer those questions, but serious questions remain.

The principle that I mentioned has now been accepted, but there is a recognition that the current arrangements for running those ferry services are not sustainable. I was pleased that the finance secretary accepted the need for urgent action on a longer-term solution. In Orkney, that means replacement vessels. The current fleet is no longer up to the standards to operate on many of those routes. The boats cost more to run, more to fix and more to keep at sea. Delays in replacing them are increasingly a false economy, which comes at a cost to the communities that rely so heavily on them.

As a matter of urgency, the new transport secretary must now get round the table with the local council and agree a programme for fleet replacement. That is being done on the west coast, where multimillion pound vessels are at least being procured, even if the building and delivery are not necessarily going according to plan.

The recent passing of the Islands (Scotland) Act 2018 is not job done. Communities such as the ones that I represent expect it to be backed by action, including action on investment in infrastructure, such as our lifeline ferry services.

In passing, I urge the Government to sort out the road equivalent tariff mess on northern isles ferry routes. I appreciate that the dispute with Pentland Ferries is not entirely of its making, but the deafening silence from ministers over the summer is not encouraging. Those who travel between Orkney and Shetland and the Scottish mainland are still being forced to pay over the odds for using those services, and that cannot be allowed to continue.

The Deputy Presiding Officer:

We will have to be a wee bit stricter with the time from now on.

Photo of John Mason John Mason Scottish National Party

I am very happy to speak in this debate at the start of the new parliamentary year.

I say to Liam McArthur that some of us do not do “raucous adulation” at all.

The programme for government looks very positive to me, and it seems to build on last year’s plans. Last year, one bill that I was heavily involved in was the Islands (Scotland) Bill. Some Opposition members have suggested that we could push through more bills or push through bills faster and that the present system is perhaps too slow. However, the Government did a lot of work in preparation for that bill, and the Rural Economy and Connectivity Committee, which I am a member of, spent a huge amount of time here and visiting the islands to take it through. We did some of that work during recess, and we had a lot of good input from all six councils that were involved. I would be very reluctant for us as a Parliament to churn such bills through faster and end up with a more slapdash approach, such as that at Westminster.

Photo of Bruce Crawford Bruce Crawford Scottish National Party

Does John Mason remember the number of times that the Opposition complained about the amount of legislation that the SNP pushed through Parliament when it could in the period from 2011, when it was a majority Government?

Photo of John Mason John Mason Scottish National Party

Yes. That is a fair point. It is clear that the Opposition says one thing one day and another thing another day.

I am particularly interested in the economic side of things. The idea that there will be more focus on infrastructure strikes me as extremely good. That can mean more jobs. Just yesterday at the Economy, Jobs and Fair Work Committee, we heard that gross valued added in the construction sector was £52,900 per head in 2016, which is higher than the figures for many other sectors. Therefore, that is a good place to invest in. We have to accept that there has been a tradition of construction jobs going to men, so we need to continue challenging such gender stereotypes and to break down traditional barriers in society.

As yet, we have not seen the details of how all the extra money will be allocated. As others put in their bids, I, as a co-convener of the cross-party group on rail, would be very happy to see more money being spent on rail. The Perth to Inverness line, for example, is an opportunity and a challenge. Dualling the A9 is absolutely great and fabulous, but a side effect could be putting rail travel at a disadvantage. I hope that that will be one area that the cabinet secretary will look at.

We also think about how the other two main parties view the economy. The Conservative Party would like us to think that it is the realistic party. The Conservatives realise that we have to live within our means and that expenditure cannot outstrip income year after year, and they want to see growth and an increase in productivity. I can agree with many of those things, but there is a problem with the Conservative vision for the economy. The Conservatives do not seem to care how the growth comes about or who suffers in the process, as long as the economy grows. If the rich got super rich and the poor got super poor, that would still be success in the Conservative world, as long as the economy was growing.

On the other hand, we have Labour, which does not do realism. Richard Leonard and Jeremy Corbyn are probably well-meaning people, in a bumbling sort of way. They say that we should spend more and more; they do not really have a plan for where the money would come from—perhaps they would start a new tax tomorrow or raise an old one, but why bother planning such things?

Photo of John Mason John Mason Scottish National Party

Absolutely.

Perhaps we could borrow and borrow and hope that somebody will repay the money one day.

In contrast to those two flawed models, we have a party of government—the SNP—that the people of Scotland clearly trust, because we have been in government for 11 years. It is a challenge to be in government and to be forced to be realistic but aspirational at the same time. The programme for government strikes a good balance between being more progressive than the UK has been—we are raising income taxes a bit more and investing for the future—and being realistic about what we can borrow and afford to pay back in the future.

Brexit is a huge aspect of any programme for the coming year, and a number of members have mentioned it. Many of the public and many of us are getting fed up with the endless bickering at Westminster and with the myriad of potential scenarios. Perhaps our Conservative colleagues could tell their London masters that it is about time that we had definite plans and actions, and not just contradictions, claims and counterclaims.

One of the Conservatives’ favourite lines is that Scotland does more trade with the UK than with the EU—61 per cent of Scotland’s trade is with the UK and 17 per cent or thereabouts is with the EU. That is well and good—it is true—but the Conservatives’ idea that we can forget about the 17 per cent, which I presume would mean a 17 per cent hit on our economy, is absolute madness.

Scotland cannot afford to lose either of those important markets. Our farmers, fishing boats and businesspeople need both the UK market and the EU market, so will the Conservatives please put the country’s interests ahead of their narrow party squabbles?

It was Jack McConnell who led a lot of activity on the population and immigration. We cannot grow the economy if we are not allowed to have a growing population, which is key to growing our internal markets, our taxpayer base and our workforce.

I hope that the Opposition parties will take the opportunity to engage constructively with the budget and sit down to seek to reach a compromise. We have a minority Government in a Parliament with proportional representation; we all need to compromise and no one will get exactly what they want. I appeal to Labour and the Tories to think a bit more seriously than they have in previous years.

Photo of Liam Kerr Liam Kerr Conservative

I have not yet had the chance to formally welcome the new Cabinet Secretary for Justice to his role and I am pleased to do so in general and in the context of the programme for government. Some might consider his inheritance to be something of a poisoned chalice, as violent crime is up, drug crime is up and robbery is up, while the detection rate is down. That is in the context of police officer numbers having been cut to a nine-year low. It would be a big ask for anyone—let alone someone from a completely separate brief—to pick that up cold, which is why I reiterate Ruth Davidson’s point from yesterday and encourage the new justice department to work with those who have the experience and the policies.

The early signs are promising. Unlike the cabinet secretary’s predecessor—who, in the face of repeated criticism from the Scottish Conservatives, train operating companies, trade unions, most of the other Opposition parties and the public, railroaded through the unwanted, unnecessary and dangerous BTP merger—the new cabinet secretary has climbed down. However, railway policing is—oddly—not mentioned at all in the programme for government.

The programme for government makes an unequivocal and unambiguous promise to introduce Finn’s law. It is clear that the efforts of the Finn’s law campaigners, the petition with 40,000 signatures, the correspondence from kids at Mossneuk primary school, the members’ business motion that had cross-party support and my demands on Monday for Finn’s law to be included in the programme for government worked.

Then there is restorative justice. In the debate on last year’s programme for government, I said that the Government should

“introduce a genuine restorative justice programme to tip the balance back in favour of victims who too often experience a justice system that offers them nothing.”—[

Official Report

, 7 September 2017; c 66.]

I also led a members’ business debate on the subject about six months ago. The result has been a commitment to publish a restorative justice action plan by spring 2019. That is good.

We demanded a commitment to crack down on drug-driving, and I welcomed last year’s programme for government, which promised to implement that. Unfortunately, the SNP is yet to lay the statutory instrument to get it done, but at least—as on many other aspects of last year’s programme—the commitment has been reheated, which is welcome.

There is much in the justice brief that is less encouraging. I noted the cabinet secretary’s recent statement in a magazine that

“Victims’ rights will be strengthened”, but the programme for government does not do it. The measures for victims that have been announced fall far short of what is required. Bluntly, the programme for government offers to ensure that victims and their families will have

“better information and greater support ahead of prison release arrangements”, but there is no commitment to give victims and families any meaningful input.

Victims and their families have asked that it be explicitly required that their safety and welfare be taken into account. They have also asked for increased use to be made of exclusion zones for offenders and for the victim notification scheme to be revised so that they are given reasons for release and can make representations in person. That would represent meaningful input into a process that currently treats victims as little more than an afterthought. That is Michelle’s law, which will form the subject of my members’ business debate tomorrow, to which I am very much looking forward.

I have two final points. Yet again, the ill-thought-through extension to the presumption against custodial sentences from three to 12 months has reared its head. I understand that the SNP wants to save money by emptying our prisons, but compromising the safety of the people of Scotland by allowing serious criminals out on to the streets is not the solution.

Last year, 10,000 offenders were sentenced to 12 months or less in prison. That figure includes two offenders who were convicted of homicide, 99 who were convicted of serious assault or attempted murder and 60 who were convicted of robbery. The SNP’s plan will let some of the most dangerous criminals back out into society and will make life even more miserable for victims of crime across Scotland.

Photo of Humza Yousaf Humza Yousaf Scottish National Party

Just yesterday, Liam Kerr’s UK Government colleague the minister of state for prisons, Rory Stewart MP, said:

“It is of course true that we have evidence that shows clearly that there is a higher incidence of reoffending from people in short prison sentences than from people who serve community sentences. That is why the example from the Government of Scotland is very relevant.”—[

Official Report, House of Commons

, 4 September 2018; Vol 646, c 47.]

Is the member similarly critical of his UK Government counterpart?

Photo of Liam Kerr Liam Kerr Conservative

Is it not interesting how the SNP is so focused on what is happening in England and Wales? It is almost as if the SNP does not know that we have a separate justice system.

I am interested in Scotland’s justice system, and from the evidence that we have, it is clear that, as it is currently constructed, the SNP’s community sentencing model is not working.

The cabinet secretary mentioned Rory Stewart. I remind him that Rory Stewart also said that he would resign if he did not sort out the prisons within a year. I look forward to the cabinet secretary making a similar promise.

I turn finally to prisoner voting. I note that the references to consulting on that issue are buried on two separate pages out of 118. Each reference comprises eight words. I am not surprised that the SNP is a bit embarrassed about giving prisoner voting any profile. The SNP has been criticised for being too distracted by its own troubles to deal with the things that really make a difference to communities, and here is a great example of exactly that—a consultation about a reform that is unworkable, unwanted and not morally justified. As well as being a waste of time, because when prisoners are sent to prison, they surrender their right to choose the Government, the consultation is little more than an insult to victims and their families.

The SNP needs to get back to the day job and start putting victims and communities first. I look forward to helping the cabinet secretary to retain that focus.

Photo of Emma Harper Emma Harper Scottish National Party

I am pleased to speak in and to welcome today’s debate on the programme for government. I absolutely endorse the programme that the First Minister set out yesterday. I would like to focus on two key aspects of it. One is health-related and one is economy-related.

The first aspect that I want to discuss is the announcement of an additional £250 million investment in mental health, which will deliver 350 dedicated counsellors in schools, an additional 250 school nurses and an additional 80 counsellors to work in further and higher education. Extra funding will also be provided for teachers. The objective of the investment is to provide our young people and their families with a high standard of emotional and mental health support, guidance and advice, which will enable them to proceed effectively and efficiently with their education.

First as a nurse and former clinical educator, but also as a member of the Health and Sport Committee and as the new co-convener—along with James Dornan and Annie Wells—of the cross-party group on mental health, I am extremely proud to support a Government that not only takes mental health seriously, but is the first Government in the UK to have a dedicated mental health minister. I wish Clare Haughey well in her new role as the Minister for Mental Health.

I look forward to seeing the outcome of scrutiny of progress towards implementation of the programme for government. Just before the summer recess, I sponsored a reception for the Scottish Eating Disorders Interest Group in the Parliament. We heard many inspiring stories from experts, parents and—most important—people who live with eating disorders. A key message from the people who attended the SEDIG event was that early diagnosis and treatment are key, so that the most effective management and recovery can occur. I ask the Scottish Government to consider an approach that would support young people who may be experiencing eating disorders, including diabulimia, that negatively affect their health.

The second point on which I will focus relates to my South Scotland region: the creation of the south of Scotland economic partnership. The partnership is being led by Professor Russell Griggs, ahead of the First Minister’s announcement yesterday to legislate to create a south of Scotland enterprise agency. The south of Scotland economic partnership has been operational for the past 12 months. Its board members have been holding engagement meetings across South Scotland and there has been strong engagement and interest. The partnership is key to the development and ultimate sustainability of the economy and, indeed, to the economic development of the region, so I am pleased to report that the meetings have been well received, and that there has been predominantly positive feedback from people who have attended.

Although the south of Scotland enterprise agency will be crucial in supporting investment in the south’s economy, we must also recognise that digital, road and rail infrastructure are also key to attracting business, tourism and people to the south. Therefore, I am happy that the programme for government includes a commitment to improving the infrastructure of the south of Scotland by carrying out and implementing major infrastructure projects across the region, including the Maybole bypass, broadband infrastructure and publication of the south of Scotland strategic roads and rail review. I look forward to that review’s completion. The review is under way and will identify infrastructure projects that are required across the South Scotland region and will inform projects, going forward.

Along with my colleagues Jeane Freeman and Joan McAlpine, I will continue to lobby the Government for investment in the A75, A76 and A77, and I look forward to future announcements about those major arterial routes, which are necessary for business, tourism and daily travel.

While attending agricultural and cattle shows over the recess, I took the baby box on tour. The chance for folk to look inside and get in about the contents proved to be worth while, and many positive comments were made. In the south-west of Scotland, about 4,000 baby boxes have already been delivered, which means that there have been about 4,000 babies delivered, too. The feedback that I have received indicates that the baby box has significantly helped parents by allowing them to focus their finances on other necessary products.

While the UK Government continues its boorach Brexit bungling or—to use John Mason’s word, “bumbling”—I support the Scottish Government, which is getting on with the day job by delivering and, indeed, standing up for people in Scotland.

I am done, Presiding Officer, so you have a wee bit of time in hand.

The Deputy Presiding Officer:

How very kind of you, Ms Harper.

Photo of James Kelly James Kelly Labour

Families throughout Scotland who were looking at yesterday’s programme for government announcement for measures that would provide a much-needed boost to household income would have been sadly disappointed.

As Jackie Baillie pointed out, the economic outlook is bleak. The Scottish Fiscal Commission records that forecast growth will not exceed 1 per cent until 2023. The problem is not just with the figures, but with what they actually mean on the ground. The reality is that far too many people in Scotland’s economy are working in low-paid jobs. We still have 467,000 people who earn less than the living wage. For example, a person in Rutherglen who works in a fast-food restaurant on the minimum wage of £7.38 per hour will earn only £258 per week. As someone recounted to me earlier in the week, that means that people are doing three jobs in order to make up the gaps in their household incomes. As we move forward, and fuel and food bills increase at a greater rate than inflation but wages struggle to keep pace with it, and as the Fiscal Commission has pointed out, household income will continue to be under pressure, which will, potentially, have a detrimental effect on economic growth.

Added to that, we have had a sustained SNP programme of cuts to public services, which have drained economic growth. One example is that, since 2010, £400 million has been cut from education, which means that there are fewer teachers—3,500 fewer since 2007—and fewer classroom assistants. Ultimately, that has an impact on results. The recent batch of exam results show that the pass rates for highers, which are key qualifications for university entrance, declined for the third year in a row.

Not only that, but not enough people are taking up some key subjects. For example, there have been serious declines in languages including French and German. I assume that when Brexit happens we will still want people who are qualified in foreign languages so that we can interact with companies abroad. The facts that we do not have enough students taking such subjects and that there are also declining pass rates are of real concern.

On university entrance, restrictions on places for home-based students have resulted in reductions in key areas. For example, in medicine, uptake of places by Scottish students in the year 2000 was 63 per cent of all places, but in 2017, the figure was down to just over 50 per cent. That comes when the chair of the British Medical Association in Scotland tells us, as he did this morning, that the crisis in the national health service is at “tipping point” and we are not training the same number—

Photo of Derek Mackay Derek Mackay Scottish National Party

I know that the Opposition is perfectly entitled to give a critique of Government performance and policy. We could argue about it all day, but let us cheer the chamber up. I ask Mr Kelly what is the single big policy idea coming from the Labour Party right now?

Photo of James Kelly James Kelly Labour

The big idea is to stop the cuts. [

Interruption

.] We must stop draining £400 million from Scotland’s education sector

. Mr Mackay, if you continue to cut—as you have done repeatedly since 2011, and all the meek back benchers press their buttons to vote for those budgets—you take resources out. [

Interruption

.] As I have explained, the results then deteriorate, we do not have enough qualified doctors coming through and we end up with the BMA telling us, as it did on the radio this morning, that the NHS is at “tipping point”. That is a direct result of your policies.

Added to that, we have had real inaction from the SNP. You have tinkered around the edges on tax powers that you demanded for years but have not been able to use effectively, just as you have done nothing to target top-rate taxpayers. Also, when the outturn figures were reported, we found out that you had underspent the budget by £454 million. Nearly half a billion pounds had been stuck down Derek Mackay’s sofa in St Andrew’s house instead of providing help to Scotland’s public services. [

Interruption

.]

In addition to that, you were not prepared to give any much-needed assistance or support to councils on issues including the tourist tax, which would have raised a lot of money during the Edinburgh festival.

I am delighted that I have cheered up the chamber and got a bit of atmosphere going. [

Laughter

.] I am also delighted to be cheered by SNP members.

On a serious note, we need a programme that stops the cuts, and we need a proper economic and industrial strategy that has skills as its priority. We also need to prioritise providing proper well-paid jobs. That is the difference that we need to make in order to move Scotland’s economy forward.

The Deputy Presiding Officer:

Thank you, Mr Kelly. I did not want to halt you in the middle of your speech, and I understand that you were passionate, but I remind all members not to use the word “you” when referring to other members.

Photo of Colin Beattie Colin Beattie Scottish National Party

I congratulate the First Minister and her Government on the programme for government.

Recent analysis of Scotland’s economy makes for encouraging reading. Last month’s quarterly national accounts showed an updated gross domestic product growth estimate of 0.4 per cent for the first quarter in 2018, which was revised from June’s estimate of 0.2 per cent. That compares well to the equivalent growth rate figure for the whole of the UK, which stands at 0.2 per cent. Output in the services and production sectors grew in the first quarter by 0.4 per cent and 1 per cent respectively. The construction sector contracted by 1.4 per cent, but we should remember that the weather—specifically, the beast from the east—played a major role in that.

When compared to the same quarter last year, the indications are that Scotland’s GDP has grown by 1.3 per cent in real terms, which is revised from a first estimate of 0.8 per cent and comparable to the equivalent UK growth of 1.2 per cent.

That evidence clearly shows that, despite the global financial uncertainties that are affecting all economies and after a decade of Westminster’s austerity measures that were supposed to cure the UK’s financial ills but have merely promoted poverty and hardship, the measures that the Scottish Government is taking to protect and promote the Scottish economy are fundamentally the right ones.

There should be no doubt that Scotland is a rich and successful country with many assets that other countries covet. We stand in the top 25 global economies in terms of income per head, and rank behind only London and the south-east of England in terms of most long-term indicators. Our goods exports have increased by 12 per cent over the past year—the fastest growth of any nation in the UK—while the latest EY attractiveness survey showed that, outside of London, Scotland remains the top UK region for foreign direct investment projects.

However, despite that positive background, we face many challenges in the years to come. Unsurprisingly, foremost of those is Brexit. Our export success is directly threatened by the prospect of removal of access to the single market and customs union, which I do not need to remind my fellow MSPs is a market that is around eight times bigger than the UK market alone. As it stands and including the European Economic Area, Scotland’s exports to Europe accounted for more than 52 per cent of our exported goods in 2016.

A major part of those exports is oil and gas, which are our largest export by some margin, standing at around 17 per cent of our total exports to the EU. The oil and gas sector has seen its troubles in past years, but it is beginning to consolidate. Recent analysis by the Oil and Gas Authority shows that production this year is expected to be 18 per cent higher than in 2014. Meanwhile, the latest Fraser of Allander institute oil and gas survey shows that net confidence of oil and gas contractors is at its highest level since spring 2013.

Leaving the European Union without any kind of plan in place is almost certain to jeopardise the cautious growth and optimism that the oil and gas sector is reflecting. Given that oil represents less than 5 per cent of total UK exports, it is unsurprising that the Conservatives have chosen not to emphasise the sector in the Brexit negotiations, despite its crucial importance to Scotland. If we were free to negotiate our own deals, we would have the opportunity to focus on what truly matters to our economy and would not have to rely on others who do not care to hear Scotland’s voice.

Perhaps that behaviour is to be expected from the Tories. Figures that were released in May under freedom of information showed that, in my constituency alone, cuts to disability payments meant that East Lothian lost out on £1 million and Midlothian lost £1.1 million. The sum that was lost across Scotland’s communities came to a staggering £56 million. For many local people and economies that money is a lifeline, and to have it taken away displays not only a callous attitude towards the people of this country but a short-sightedness in how to support communities from the ground up.

At the same time, Labour cannot get away from accusations of short-term thinking. The morally questionable endeavours known as private finance initiatives have had major financial impacts in my constituency. Midlothian Council is now spending 11 per cent—more than £10 million—of its annual school budget servicing PFI debts left by the Labour Party a decade ago. East Lothian Council is spending a similar percentage of its school budget, equating to around £8.9 million, on PFI debts.

In 2016-17, total PFI repayments across Scotland cost over £1 billion. That contrasts with the Scottish Government’s investment in our local communities. For example, since 2009, the schools for the future programme has invested £9.5 million in East Lothian schools and £50.8 million in schools in Midlothian.

Another initiative announced as part of the programme for government is the launch of the national investment bank. The programme for government outlined how we will set aside resources of £340 million to fund the bank in the first instance. As convener of the cross-party group on industrial communities, I will put a plug in here. I am pleased to say that this evening’s meeting will feature a guest speaker from the Scottish Government who will speak on that topic.

The programme for government outlines a wide range of other measures to promote and enhance our economy. For example, the Government will provide £96 million of extra support to deliver the most attractive package of business rates in the UK, with the increase to the rates poundage capped at consumer, rather than retail, prices index inflation.

The issue of housing is one that many local economies depend on, and the Government will establish a new £150 million building Scotland fund to unlock new house building, develop new low-carbon commercial property and support research and development. Transport is another sector that strongly ties into the economy, and the Government will invest £60 million in the low-carbon innovation fund, to deliver innovative low-carbon energy infrastructure solutions, including electric vehicles, while also investing £1.2 billion in the transport infrastructure.

Presiding Officer, I hope it is clear from all that we have heard from the First Minister and the Scottish Government over the past day or so that Scotland is in safe hands. The Tories willingly choose to ignore investment and support for communities, while Labour cannot be trusted to get its sums right without landing a future Government with unsustainable levels of debt. I look forward to the implementation of this programme for Scotland.

Photo of Rachael Hamilton Rachael Hamilton Conservative

I welcome the cultural and tourism elements of the programme for government and, on a cordial note, I am pleased to see that the Scottish Government recognises the importance of tourism and culture as a force for good.

There are several aspects of the programme for government that are positive news for the tourism sector, and I was pleased to receive reassurance from Fiona Hyslop that the so-called tourism tax has been ditched. On 22 June 2018, I received a letter confirming that

“Scottish ministers are not willing to consider requests to explore a possible tourism levy unless the tourism and hospitality industry are involved from the outset and their long-term interests are fully recognised”, which seems to be at odds with what Kate Forbes said earlier. I also welcome the fact that there is incentivisation to promote agri-tourism which, working with farms and estates, will help to develop food tourism.

We all know that every £1 that is spent on culture and tourism generates between £4 and £6 extra for the economy. The tourism industry accounts for one job in 12 and is described as the cornerstone of the Scottish economy. It is vital for economic performance across Scotland’s towns, cities and regions. The tourism Scotland 2020 strategy centres on influencing investment in the sector and supporting infrastructure, and on improving the quality of visitor experience across Scotland. That is what I want to concentrate on today.

It is a no-brainer that investment in the culture and heritage sectors boosts the economy, tourism and employment in areas where those three factors often struggle to perform well. The potential for tourism in Scotland is colossal. The exciting and diverse range of attractions that our country has to offer makes it a unique destination, not only for domestic travellers but for international visitors.

However, this SNP Government has simply not grasped the nettle when it comes to maximising Scotland’s potential and helping out communities with necessary additional infrastructure. How far will the £6 million that was set aside last year for the rural tourism infrastructure fund really go to alleviate the worries of local communities? Take, for example, the world famous north coast 500 route—it is a breathtaking drive through some of Scotland’s most awe-inspiring and dramatic natural landscapes, but the fact remains that the roads along the north coast are narrow, bumpy and dangerous. Motorbikes and fast cars treat them like Scalextric tracks. Why was the issue not mentioned in the programme for government? Where is the Scottish Government support for local communities that are crying out for investment in that regard?

Photo of Derek Mackay Derek Mackay Scottish National Party

It sounds as though the member is building a crescendo towards demanding more funds for investment in the tourism sector. I understand the appeal, but how does her demand match up with the only things that the Conservatives have raised in the Scottish Parliament, which are tax cuts for the richest and tax relief for independent schools?

Photo of Rachael Hamilton Rachael Hamilton Conservative

I do not know whether you remember that we had a debate in which the Scottish Conservatives called for a £100 million pothole fund—[

Interruption

.] It was in our manifesto in 2016, which was costed.

Derek Mackay also found £10 million for local authorities to assist with road maintenance after the beast from the east, so I am sure that you can find something down the back of your sofa again—

The Deputy Presiding Officer:

Ms Hamilton, he might find something down the back of his sofa, but please stop using the word “you”. I have already reprimanded members for doing so.

Photo of Rachael Hamilton Rachael Hamilton Conservative

I apologise, Presiding Officer.

Another example is the beautiful Glenfinnan viaduct, which has been used time and again in film and television, and which cannot cope with extra visitors, due to the lack of car parking capacity. Tourists who want to visit are turning away as a result of a lack of infrastructure.

Historic Environment Scotland, which owns many of Scotland’s most famous landmarks, is launching a Robert the Bruce trail to capitalise on the release of “Outlaw King”.

It is all very well applauding the success of tourism, but the Scottish Government needs to commit to supporting the sector, too. Rural and remote areas are struggling to cope with demand, which in turn is discouraging tourists from visiting busy areas. No member in the chamber wants that, so I call on the Scottish Government to be ambitious and to have an honest and frank conversation with communities in areas that benefit from tourism to ensure that they all have the necessary tools to take advantage of the tourism potential. I reiterate that the programme for government fundamentally misses the point about the insufficient infrastructure and shows a lack of consideration for rural areas.

The programme for government wants a vision for culture that is inclusive. I am pleased that the Scottish Government continues to allow free access to Scotland’s museums and galleries, but I cannot help but notice that there is no mention of inclusion for people with, for example, mental health issues or dementia. We need to work constructively to ensure that cultural experiences and events are accessible to and appropriate for everyone.

The programme for government rehashes old announcements and commitments, offering few new attractions. It is the same regurgitated, boring, old stuff as we heard last year—just in a different order. Vital projects are missing out on new funding, such as concert venues, galleries, and theatres, which could promote inclusive tourism, as Capital Theatres has done.

Like many members, I am looking forward to the opening of the V&A museum, which will bring many people to Dundee. It is a fantastic example of the UK and Scottish Governments pooling resources and working together.

I am conscious of the time, but I want to make one more point. The Scottish Government is responding to the Royal Conservatoire of Scotland review and, in the year of young people, it is important that we take a serious look at the provision of music education, so that such education remains accessible to all.

Some announcements in the programme will encourage cultural participation and boost tourism, but the bottom line is that this SNP Government is tired and running out of steam. Frankly, I was disappointed.

Photo of Gordon MacDonald Gordon MacDonald Scottish National Party

I welcome the programme for government and today’s focus on the economy. In particular, I welcome the commitment to increase by £7 billion annual infrastructure investment for hospitals, schools, housing and a range of other investment projects.

That is particularly important for Edinburgh, which is one of the UK’s economic hot spots. Many of the largest companies in Scotland have a presence in the city. I mention two areas that highlight the success of Edinburgh’s booming economy. The financial services sector has grown by 46 per cent over the past five years and the demand for staff in Edinburgh and Glasgow has resulted in Scotland being the best area of the UK for graduate pay. New company start-ups are growing at a faster rate in Scotland than in the rest of the UK—and double the rate in 2000. In Edinburgh, the business start-up five-year survival rate is higher than it is in any other UK city, including London, Manchester and Liverpool.

Tourism is booming in Edinburgh with record numbers of visitors coming to the city last year and this year also heading for record levels. The result is that hotel occupancy rates are higher than they are in most other major European cities.

To support the growing economy in Edinburgh, we need people. During the past 10 years, the city has had the highest growth in the number of households among Scottish cities. The 12 per cent increase in population during that period equates to an average of 100 new residents a week, every week.

The council is pulling out all the stops to address the housing need. This month will see the letting of the new affordable homes at Fernieflat Neuk in the Calders area of my constituency, and homes will be let in north Sighthill later this year. There is no doubt that we still need more affordable homes, so this increased infrastructure expenditure will support the council to deliver its ambitious programme to build at least 10,000 social and affordable homes during the next five years, with a plan to build 20,000 by 2027.

Alongside the new homes that are being built, we need superfast broadband that allows households to watch television and shop and pay their bills online. Unfortunately, in the semi-rural parts of my constituency, connectivity has been poor. However, the announcement that the R100 contract will be awarded in the coming year will mean that the poor connectivity that concerns some of my constituents will be addressed so that every business and residential property in Scotland will have access to superfast broadband.

The families who have been attracted to Edinburgh to take advantage of the work opportunities need good-quality educational facilities. Across Scotland, the proportion of schools that are either good or satisfactory has improved from 61 per cent in 2007 to 86 per cent in 2017. Parents in my constituency are looking forward to the next round of funding for the schools for the future programme, as a number of high schools in my constituency were built in the 1970s and are now in need of refurbishment.

We must also protect the character of Edinburgh, and the investment in our railway network that is under way, especially on the Glasgow to Edinburgh via Shotts line, will allow people to commute from further afield where housing costs are substantially cheaper. My constituents who use Curriehill, Wester Hailes, Kingsknowe or Slateford railway stations will also benefit from the investment in our railways because of the introduction of the new class 385 rolling stock—the most modern trains in the UK—in the coming months.

It is not just the investment in railways that is helping the Scottish Government tackle congestion and air quality issues in Edinburgh; it is also the investment in other areas of public transport. The Scottish green bus fund has already supported investment by Lothian Buses in purchasing 65 low-carbon vehicles as part of a package that invested £16 million towards putting 360 low-carbon buses into the Scottish bus fleet. The eighth round of the Scottish green bus fund will see further investment of £1.7 million that will add more than 100 green buses to the fleet, and help to deliver the climate change plan commitment of 50 per cent by 2032.

My constituency is also home to Dreghorn barracks and Redford cavalry and infantry barracks, so I welcome the announcement that the veterans commissioner’s recommendations will be implemented. They include providing support for individuals who are transitioning from the military to find fulfilling civilian careers and to develop an approach that meets the healthcare needs of veterans. I also welcome the support that will help veterans and military spouses who want to run their own businesses to find space to develop their business ideas at new workspace hubs that will be located near main defence bases.

This year’s programme for government is entitled “Delivering for Today, Investing for Tomorrow”. For my constituents in Edinburgh Pentlands, that is exactly what the Government is doing.

Photo of Dean Lockhart Dean Lockhart Conservative

Before recess, the Economy, Jobs and Fair Work Committee published a wide-ranging report on the performance of the Scottish economy during the past 10 years. The inquiry lasted for six months and the committee heard evidence from stakeholders across all sectors. The main conclusions of the report include the statement that “ economic growth in Scotland” in the past decade has been

“significantly below ... the performance of the UK economy”, as well as below Scottish Government targets and historical growth rates for Scotland.

Photo of Dean Lockhart Dean Lockhart Conservative

I will in a second.

The report goes on to conclude that “levels of GDP growth” in Scotland “are marginal”, that “productivity is low” and that “wages are stagnant”. Those conclusions are supported by what the Scottish Government’s figures tell us about what is happening in the economy. We are seeing the lowest trends in economic growth in Scotland for 60 years.

Perhaps the cabinet secretary can now explain why that is the case.

Photo of Derek Mackay Derek Mackay Scottish National Party

That is not the case. The point that I was about to make is that, since the publication of that report, and with regard specifically to GDP, Scotland is outperforming the rest of the UK.

I have read the Economy, Jobs and Fair Work Committee’s report and—I am sure that Dean Lockhart will welcome this—I will try to implement as many as I possibly can of the recommendations of that very fair report. Equally, however, will Dean Lockhart welcome the fact that Scotland’s economy is outperforming that of the rest of the UK?

Photo of Dean Lockhart Dean Lockhart Conservative

I would welcome any good news on the Scottish economy because it is such a rare event. I say to the cabinet secretary that he should read page 14 of the committee’s report, which shows that the Scottish economy has lagged behind that of the rest of the UK for nine of the 11 years during which his party has been in power. Every leading forecaster is predicting that, between now and the next Holyrood election, the Scottish economy will continue to underperform that of the rest of the UK. That is the economic reality that the cabinet secretary has to recognise.

Wages are falling across the economy, productivity levels continue to decline, record numbers of shops are closing on high streets across Scotland and, as we have heard, the latest GERS numbers show the highest ever gap in the public finances between Scotland and the rest of the UK, resulting in a record union dividend of more than £1,800 per person.

Given that unprecedented economic background, the main recommendation of the Economy, Jobs and Fair Work Committee, supported by all members, was for the Scottish Government’s economic strategy to be reviewed and updated as a matter of urgency. This programme for government provided the SNP with the ideal opportunity to do that and to move away from the failed economic agenda of the past 11 years and set out a new vision for the Scottish economy. However, the programme for government fails at every level.

Photo of Dean Lockhart Dean Lockhart Conservative

I need to make progress but I might give way later on.

First, there is no new vision. Practically all the measures in the programme for government have been announced before. There is nothing new in the south of Scotland enterprise board announcement, the Barclay review, the tinkering with business rates or the establishment of trade desks in British embassies, and the Scottish national investment bank has already been debated in this chamber.

The programme for government does set out two new economic measures, but they lack credibility. First, the national export plan to help increase Scotland’s exports across the world has funding support of less than £7 million a year. To put that into context, there was an announcement today of £30 million for staffing for the Scottish national investment bank. That shows how real the SNP’s ambitions are for growing Scotland’s exports.

Secondly—perhaps this is what Mr Mackay wants to talk about—there is the new economic action plan that was announced yesterday as a central part of the programme for government. However, when we look closer, we can see that it is hidden in a footnote on page 46 of the programme. That shows that this is an exercise in spin and no substance from the SNP.

However, the fundamental problem with the programme for government is that people no longer trust the SNP to run the economy. The people of Scotland have seen promise after promise being broken by the SNP when it comes to the economy.

In the programme for government 2016-17, the First Minister announced the Scottish growth scheme as a £500 million vote of confidence in business. However, more than two years later, not one loan has been granted to Scottish business under the scheme. In the 2016 Hollywood manifesto, the SNP promised not to increase the basic rate of income tax. However, we now have more than 1 million people in Scotland paying more as a result of that broken promise. Yesterday, the First Minister promised that the business environment in Scotland will remain competitive, but the SNP continues to punish business by imposing the large-business supplement. Further, the SNP has promised to increase activity to the first quartile but, again, figures that were released just two weeks ago show that we are still in the third division.

The list of SNP broken promises on the economy is endless, but that should not surprise us because, in the final analysis, the SNP will always prioritise independence above everything else—above the economy, above the NHS and above education.

Photo of Dean Lockhart Dean Lockhart Conservative

No; I am running out of time.

I remind the cabinet secretary that it was the First Minister herself who made it clear that independence

“transcends the issues ... of oil, of national wealth and balance sheets”.

It could not be clearer what the priority is.

The people of Scotland want real change. They want an end to constitutional politics and they want a Government that is focused on the day job. This programme for government is not the answer. It is now clearer than ever that this is a tired government, out of ideas, out of its depth and running out of time.

Photo of Neil Findlay Neil Findlay Labour

The economy is not separate from public services. Over the summer, I met and dealt with constituents who want and need real change. I mean constituents who are struggling to get by, feel powerless in their daily lives and do not see an economy or society that works for them. I mean constituents such as the families in Livingston that cannot access the children’s ward at the local hospital; they want a fully funded NHS. I mean those in Seafield whose countryside is threatened by a housing development that is outside the development plan; they want equal rights in the planning system.

I mean the families in Livingston, Addiewell, Bridgend, Dedridge, Dechmont and Stoneyburn who are isolated because FirstBus withdrew their bus services; they want a bus that takes them to work and keeps them in a job. I mean the businesses and workers who have real concerns about their jobs and futures in post-Brexit Britain; they want reassurances and confidence so that they can plan the way forward.

I mean the people in East Calder and Mid Calder who want a new health centre, those in Midlothian who cannot access a general practitioner and those in Stoneyburn who have lost their GP service altogether. I mean families in Edinburgh who see so-called market failure in social care leaving their loved ones stuck in hospital instead of being back in their own homes; the parents and partners who are taken to the brink by seeing the people whom they love disappearing before their eyes into a black hole of despair because they cannot get help for their mental health conditions; and the families and friends of the 1,000 people who have died from drugs this year.

All those people need health services, social care and a system of public services that supports them and ends their suffering. The public service failures go hand in hand with economic stagnation. People need real change. They need a Government that acts for the many and not the few. They need an economy and a system of social protection that is based on equality and justice.

I will say what Labour would do to address those issues and how we would deliver exactly such a system. We would introduce a budget to end the cuts and invest in public services with fair and progressive taxation. We would introduce a planned industrial strategy that would deliver an economy that was based on high wages, skilled jobs and a long-term plan for growth and full employment. We would establish a national investment bank that was capitalised not by £250 million but by £20 billion over 10 years, which would provide the finance to develop innovation, and a national infrastructure fund that would add another £20 billion for key infrastructure projects. That is bold and ambitious.

We would also undertake a fundamental review of procurement, including of the non-profit-distributing and PFI deals, and would buy out project funding if it was financially beneficial to do so. We would establish a Brexit strategy that put jobs, living standards, consumer and environmental protection and workers’ rights at its heart. We would invest in our health and social care system to address staff shortages and to end boarding out, bed blocking, ward closures and the crisis in social care.

We would introduce the commonsense ownership of rail services and end the waste and nonsense of privatisation, in which money seeps out the system. We would also reregulate bus services. Investment in green buses is all very well but, in my region, people just want a bus.

We would also provide a fair deal for our teachers, classroom assistants and council workers. They are at the cutting-edge of delivering the public services that civilise our society. They also play a key role in reducing inequality and providing educational opportunities for all.

People do not want a plan for Scotland that is drawn up in the SNP’s cuts commission by the cabinet secretary, Kate Forbes, Shirley-Anne Somerville and corporate lobbyist Andrew Wilson because it proposes a decade of cuts, the continuation of the failed ultra-free market, neoliberal dogma and an economy based on so-called flexicurity. I will decode flexicurity for members: it means an economy in which it is easier to sack people. The commission proposes nothing to address the hoarding of wealth by the 1 per cent.

Photo of Neil Findlay Neil Findlay Labour

No.

The commission’s plan would subject our public services—[

Interruption

.]

Photo of Neil Findlay Neil Findlay Labour

Its plan would subject our public services to more job losses, more cuts and greater decline.

The Scottish Labour Party is serious about the challenges that we face in a post-Brexit world. Part of the solution is to bring economic power into the hands of people in communities. We need commonsense ownership and we need power to be decentralised.

It should be up to the City of Edinburgh Council if it wants to introduce a tourist tax; it should not be up to the culture secretary, nor the First Minister. The railways should be publicly owned so that we can keep fares affordable and invest in services without leaking money to shareholders—that is common sense. Powers should be devolved down to allow local models of ownership to flourish.

The choice in Scotland is now clear. We can continue with cuts and austerity, as championed by the Tories and meekly followed by the SNP, or we can choose a different path—the one championed by Scottish Labour—a programme based on hope and ambition that will deliver a progressive agenda to revitalise communities and end the attacks on the living standards of working people.

It is time for real change, not another year of tinkering around the edges.

Photo of Michael Matheson Michael Matheson Scottish National Party

This is a programme for government that basically contrasts two Governments: a Government that is committed to taking Scotland forward, modernising its infrastructure, investing in its economy, and making it a modern, vibrant nation, and a Government at Westminster that is in utter chaos and goes from one day’s crisis to the next day’s crisis.

I will touch on a number of points that have been raised during the debate. A number of members have made reference to the number of bills that are contained within this legislative programme. I want to deal with the misleading narrative that some members want to create, which is that we measure a programme for government based on the number of bills that have been progressed through Parliament.

In particular, Jackie Baillie made a point about the number of bills that have gone through Parliament over the year. She has been in the Parliament for as long as I have—since 1999. As a former minister, she knows very well that there are a variety of reasons for the pace at which bills go through Parliament at particular points, due to committee and parliamentary processes. She also knows that the measure of a Government’s activity is not just legislation but the Government’s wider policy agenda. This programme for government shows a commitment to a range of ambitious policy initiatives that we will take forward over the next year.

Photo of Jackie Baillie Jackie Baillie Labour

The cabinet secretary has indeed been here as long as I have and I do not think that, in any of those 19 years, the Government has produced as few as two bills. However, I think that he would also acknowledge that I recognised that this is also about policy and resources—and the Government is failing on those counts, too.

Photo of Michael Matheson Michael Matheson Scottish National Party

Jackie Baillie is wrong on that. At the beginning of the Scottish Parliament, there was a real lack of legislation from the Government that she was a member of. Anyway, she knows that her narrative is clearly not accurate.

I turn to some of the points that were raised about bills. Stewart Stevenson raised issues of concern about non-domestic rates and how they apply to former fish factories in his constituency. As he is aware, a bill will be coming before Parliament that will provide an opportunity for those matters to be debated and considered.

Alongside that, we are introducing the south of Scotland enterprise agency bill to make sure that we are strengthening the economy in the south of Scotland. I was in Stranraer a couple of weeks ago at the invitation of Emma Harper, and there is a clear desire there that we do everything that we can to strengthen the economy in the south of Scotland. This Government is introducing legislation to help to facilitate that.

Stewart Stevenson referred to the biometrics bill. I cannot say that I know much about the Indian Government’s identity card system, which he mentioned, but the biometrics bill is about modernising our legislative structure to deal with the ever-emerging new ways in which biometric data is progressing and making sure that we futureproof our approach to how that is managed in the future.

Finally, I turn to our justice system in Scotland. We should always be minded to look at how we can improve and develop our justice system and look for new ideas and approaches that can enhance how we deal with matters in that system. However, I will tell you one thing, Presiding Officer: with a cut of 20,000 to police officers, crime up across the board, prisons in meltdown and a Government at Westminster that has no idea about its justice policy, we will not listen to the Conservative Party when it comes to justice matters in Scotland.

A key part of the programme for government is to make sure that we invest in our economy and create inclusive growth as part of our economic drive, as is our investment in national infrastructure. There is no doubt that national infrastructure plays a key part in delivering inclusive growth. We have only to look at history, particularly that of UK Government, whose infrastructure investment that has lagged behind that of OECD and G7 countries. We are leaving the UK to lag behind, because we are setting out a national infrastructure mission, with increased investment of about £7 billion in Scottish infrastructure by 2025-26.

I listened to Rachael Hamilton complain in her speech that the programme for government says nothing about investment in our national infrastructure, but at the very heart of our programme for government is a record increase in that investment, which will deliver real change to communities across Scotland—investment at the local, regional and national levels, from the health service to education, transport and other public services. It will demonstrate our ambition to grow the economy.

Photo of Rachael Hamilton Rachael Hamilton Conservative

The programme for government did not have a specific list—it was a woolly statement. I hope that the Government will make commitments on some of the tourism problems that are happening in communities—for example, the Government ought to look at the north coast 500 and car parking at Glenfinnan. The Government needs to look at those things.

Photo of Michael Matheson Michael Matheson Scottish National Party

I know that

Rachael Hamilton has an interest in those matters. I think that she will recognise that it is important to look at all aspects of our economy, including tourism, to make sure that we get the right investment to deliver the maximum economic benefit. Increasing our infrastructure spend gives us the opportunity to take that work forward. As the First Minister said yesterday, I will set out in the months ahead how we will take that programme of work forward across Government.

The very significant level of infrastructure investment that has already taken place and is still on-going in Scotland should be recognised. We have just passed the first anniversary of the fantastic Queensferry crossing, which has created greater connectivity between Fife and the Lothians and greater reliability in comparison with what we had before. The delivery of the Aberdeen western peripheral route is expected to generate £6 billion of additional income in the north-east of Scotland’s economy and create some 14,000 jobs in its first 30 years of operation. That investment in infrastructure will drive the economy forward in that region. The major investment of £3 billion in the dualling of the A9 between Perth and Inverness—the biggest infrastructure project in Scotland’s history—will deliver economic benefits across the Highlands. Since 2007, £8 billion has been invested in rail infrastructure and services, increasing seating capacity and the number of services, including the delivery of the Borders railway, which has been a real success for the economy in the Borders and the people who live there.

The other major change that we have made to support our more vulnerable communities is the introduction of road equivalent tariff on our ferries—

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I ask the cabinet secretary to bring his remarks to a conclusion, please.

Photo of Michael Matheson Michael Matheson Scottish National Party

—creating a real boost for local economies across the Highlands and our rural communities. Alongside that is our record investment in digital. The £600 million investment in the R100 programme will make a real difference in connecting communities across the country through superfast broadband.

This programme for government is delivering for us today and it will invest in Scotland for tomorrow.