Scottish Parliament, 17 November 2011

384 contributions from 77 members. The official report.

Housing

Tricia Marwick (None, Mid Fife and Glenrothes)

Good morning. The first item of business is a debate on motion S4M-01346, in the name of Alex Johnstone, on housing. I remind ministers and members that time is tight and that I would like them to stick to their allotted time.

Alex Johnstone (Conservative, North East Scotland)

It is nice to be here to raise the subject of housing once again. The Conservative party has a proud record on housing, but it is a feature of this Parliament that that record is denigrated by our opponents, so I make no apology for the fact that I begin by detailing that proud record.

In the 1950s, the Conservative Government broke records for the building of public housing. During that period, it was the Conservatives who provided the homes fit for heroes that were spoken about in the years after the second world war. The quality of that housing has stood us in good stead for many years. Moving on through the decades, I note that, in the 1980s, it was the Conservatives who came up with the ingenious plan of allowing the tenants of many of those houses to own the property themselves.

The concept of selling social housing to its tenants delivered social change on a scale that Britain and particularly Scotland had never seen before and has not seen since. The communities of mixed tenure that it created are among the safest, most sustainable communities that we have in Scotland. Furthermore, the sale of council houses created a pool of houses in the market, which gave many young tenants the opportunity to buy their own homes at an affordable price. In many parts of the country, if it were not for the market in ex-council houses, it would be impossible for people to make the jump from the private rented sector into home ownership. That vital stepping stone is essential to many young potential home owners.

However, the concept of the right to buy has been the subject of political prejudice in the Parliament for many years. The stimulation for bringing the matter to the chamber for debate today, although not the key issue, was the news last week that one local authority in Scotland, East Lothian Council, has gone forward with a project that is designed to buy back ex-council houses. I do not know the specific circumstances and I do not wish to raise them. It is the concept that I will address today. I do not want the practice to spread because it is dangerous and we should not allow it to be the next step of the anti-right-to-buy prejudice.

Nigel Don (Scottish National Party, Angus North and Mearns)

Will the member take an intervention?

Alex Johnstone (Conservative, North East Scotland)

No. I will not take an intervention at this stage.

East Lothian Council’s decision to buy back former council houses is simply a rehash of that old prejudice. Some immediate need might be dealt with, but the practice will do nothing to help the wider picture. If the council purchases a former council house at £80,000, it will certainly have acquired a property to let, but that money would benefit many more people if it was used to subsidise the construction of two or more new houses, which would also sustain jobs and create training opportunities for young skill seekers. I am also concerned that the council’s actions might warp the local property market and drive up property prices, which could put home ownership even further out of reach for young families who are trying to get on to the property ladder.

The current market conditions are an opportunity for the public and private sectors to work more closely together in order to provide social housing; doing so will be to everybody’s benefit. I encourage East Lothian Council and any other council that is considering taking that step to explore more constructive solutions that will maximise the limited funds that are available.

Lewis Macdonald (Labour, North East Scotland)

Will the member take an intervention?

Alex Johnstone (Conservative, North East Scotland)

No. I will not take an intervention at this point.

Surely East Lothian’s action goes against everything that the Scottish National Party has said about supporting construction jobs and boosting the economy. Although I am sure that estate agents will be delighted, the building trade, which faces an uncertain future in the area, will be less than impressed.

The Government’s approach to housing over the past five years has been confused and contradictory. It is noteworthy more for the sheer volume of consultations in which it has indulged than for the number of houses that it has built. On the one hand, it pursues a simplistic anti-right-to-buy campaign for nothing more than political purposes, while on the other hand it seeks to develop best practice in rent-to-buy schemes.

While portraying itself as the champion of social housing, the Government has substantially reduced its overall investment, cutting subsidy to registered social landlords and then accepting that councils can enable construction by topping up that grant in the form of aid from a council’s own resources.

Earlier this year, the Scottish National Party manifesto commitment was to build more than 6,000 new social rented houses each year; since the election, ministers have referred to a target of 6,000 affordable homes—a different definition. Today, the Government amendment talks of 4,300 homes. The minister claims that he is building houses for less, but in reality houses are being produced less efficiently and with more bureaucracy.

Some years ago, like other parties, the Scottish Conservatives signed up to the Labour-Lib Dem commitment to end homelessness by 2012. While we stand by that commitment, the SNP has demonstrated its commitment to 2012 by taking a step back, leaving local councils to pick up the pieces. To add insult to injury for our hard-pressed communities, the Government’s soft criminal justice regime means that the antisocial behaviour that blights so many neighbourhoods is not being tackled effectively.

When a council jumps through the hoops required to evict a tenant who consistently makes his or her neighbours’ lives a misery, it is faced with having to rehouse that individual, albeit temporarily in some cases. The result is that although tough action can be and is taken by councils, councils’ hands are tied and there is no real positive outcome.

Alex Neil (Scottish National Party, Airdrie and Shotts)

Will the member take an intervention?

Alex Johnstone (Conservative, North East Scotland)

No, not at this point.

Sadly, it is our neighbourhoods that are left to pay the price. The whole thing is a sham, and all the while the Government has done little more than issue consultations, in between posing for yet more photos in its now well-worn hard hats and high visibility jackets.

So where now for housing in Scotland? One thing is clear: the Government cannot deliver on its own. If we are to close the gap between the number of homes that we need to build to satisfy demand and the number of properties that are built, closer partnership working between the private sector, housing associations and local authorities must be developed still further.

The national housing trust is a step in that direction but it is a blunt instrument that does not do the job for many developers or councils. Perhaps that is why the NHT is back on the drawing board. The SNP has been sent homeward to think again. Clearly, a more flexible, sophisticated solution is required, especially bearing in mind the level of return required by many lenders in order to enter the process.

However, the public and private sectors are clearly willing to work together in order to achieve outcomes. That must be harnessed and encouraged, not just to satisfy housing demand but to boost the economy, sustain jobs and create vital training opportunities for young people. It is not just about bricks and mortar. Scottish Conservatives want safe, sustainable communities that people can take pride in—communities in which people know their rights but also accept their responsibilities.

Making the planning system in Scotland more accessible could contribute to getting construction under way. Many construction businesses have expressed their frustration to me about the planning system, which they see as unpredictable and ponderous. It is holding up much-needed development and putting jobs on the back-burner. The cost of submitting substantial planning applications is prohibitive. A system that provided greater certainty of outcome and that was faster and more efficient would help remove the bottleneck of applications that are lying on planners’ desks across Scotland.

There is much that we can do. The Conservatives have always been and will continue to be active participants in the process of housing the people of Scotland. We wish to engage in that process and we have laid out our position. We look forward to hearing the usual negative resistance of our opponents.

I move,

That the Parliament recognises the pivotal role of the housing market to the Scottish economy; is concerned that housebuilding in Scotland has fallen to a 30-year low; further recognises the need to ensure that there is an adequate supply of good quality housing to buy and rent in the private and social sectors; notes the success of the right to buy policy in that it empowered people to choose their preferred form of housing tenure, allowed over half a million households to own their own home and strengthened local communities; encourages the Scottish Government to remove the limitations on the right to buy contained in the Housing (Scotland) Act 2010 and to provide higher discounts under the modernised right to buy as a means of increasing capital receipts to invest in building affordable homes for those on low incomes and to boost jobs in the construction industry; further encourages the Scottish Government to consider legislative reform to ensure fairness and equity in public housing and also to allow social houses to be allocated to people with local connections so as to protect the long-term sustainability of Scotland’s communities, and further calls on the Scottish Government to ensure that landlords make greater use of the enforcement of tenancy agreements to tackle antisocial behaviour.

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

Thank you very much, Presiding Officer.

First, I congratulate Alex Johnstone on his elevation to his new post, which I think gives him the title of the official spokesperson for the Conservative and Unionist Party, although during the leadership contest he might have wanted a different title.

Alex Johnstone acknowledged the pivotal role of the housing market in the economy, as well as the severe challenges facing the market and the consequences for the economy as a whole. It would have been far better, however, if Alex Johnstone had acknowledged that cutting Scotland’s capital investment by 36 per cent over three years, as his United Kingdom Government has done, has at the very least compounded the problems that we face. Of course, the welfare reforms, including the housing benefit reform, have done a great deal to hinder the future supply of housing in Scotland and it would have been better had he acknowledged that. It would also have been better had he acknowledged that the Scottish Government has been doing everything in its power to support the housing market.

I will make up for Alex Johnstone’s oversight. The Scottish Government has accelerated capital spend on affordable housing, kick-started a new generation of council houses—much though I know that that annoys Alex Johnstone—and continued investment to help first-time buyers access home ownership through our shared equity schemes. We recognise the scale of the challenge that we face, so we have been encouraging and supporting innovative solutions, including the one in East Lothian that Alex Johnstone mentioned, which we think is a commendable innovation in how we fund affordable housing. There is also the example of the widely acclaimed and successful national housing trust.

As a result of all that, it has been possible for us to deliver a total of £460 million to be invested, which will deliver around 4,300 homes. That is not the be-all and end-all of what we will do this year, but just one part, although Alex Johnstone seemed to interpret the 4,300 homes as the total for this year. That will not be the total, but it will contribute towards our commitment to deliver 30,000 affordable homes during the life of this Parliament. It is also unfortunate that Alex Johnstone chose to overlook all that we are doing to counter the effects of ill-conceived Westminster policies.

It is even worse that his own solution to the problem is more of the right to buy at more generous discounts—talk about confused thinking. He offers a partial assessment of the impact that right to buy has had on our communities and ignores the problems that it has caused, for example, in managing blocks of flats when some flats have been bought but others continue to be owned by social landlords. Above all, though, he overlooks the impact that right to buy has had on the amount of housing that is available for social rent and the impact that that has had on those in housing need. Certainly, in my area in Clackmannanshire we saw the council’s housing stock reduced by half over a period of time, which has produced huge constraints for people looking for social housing.

Indeed, it was the recognition of the harm being done by the right to buy that resulted in almost universal support for the previous Administration’s proposals under the previous housing minister to reform the right to buy and to end it for new-build social housing and for new tenants in the sector. Those proposals became key elements of the Housing (Scotland) Act 2010, which the previous Parliament approved overwhelmingly. The idea that a year later we might contemplate overturning such popular legislation is at best fanciful, although not perhaps as fanciful as thinking that more generous right-to-buy discounts would give social landlords more money for new build.

If Alex Johnstone and the Conservatives could drop their obsession with right to buy and perhaps even recognise the damage being done to the economy by Westminster’s policies, we might be able to have a much more productive debate about how we achieve fairness and equity in the allocation of social housing, an objective that everyone in the chamber probably shares. We all know from our constituency experience that that is a pressing problem and one that ultimately arises from demand constantly outstripping supply. The long-term solution is to build more of the houses of all tenures that people want and can afford in areas where they want to live, and that lies at the heart of our vision for housing.

Malcolm Chisholm (Labour, Edinburgh Northern and Leith)

I recognise the great difficulties that the minister faces because of the cuts in the capital budget from Westminster, but given that £200 million of capital is still to be allocated by the Cabinet Secretary for Finance, Employment and Sustainable Growth, will he guarantee that he is fighting for a large slice of that money to come to housing? Given that he has dual responsibilities for housing and transport, which sometimes compete for capital, will he assure us that housing is his top priority for the extra capital that is still to be allocated?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The member can rest assured that I will always argue for more funding for housing, but both housing and transport are central to the Government’s policy of economic growth because the construction of such projects is very labour intensive.

We face a challenge and, essentially, requiring landlords to strike a difficult balance between the legitimate claims of one group of prospective tenants over another is one element of that. We are committed to consulting on that and other matters, such as toughening tenancy rules to deal with antisocial behaviour, and plan to do so early next year.

Gavin Brown (Conservative, Lothian)

Will the minister give way?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I do not have time for more interventions; I apologise to Mr Brown.

I look forward to working with Alex Johnstone and others on devising legislation that works for tenants and those in housing need and for landlords and the communities that they serve. It is important to recognise the work that is being done by the Government on housing across the piece.

There was a large degree of confused thinking in Alex Johnstone’s speech, particularly if we go back to his point about East Lothian Council. He fails to recognise that buying those houses helps engender more interest in the local market, because once the houses have been sold their owners will look to buy elsewhere. He also conceded that he did not know that much about what was going on with this policy, but he should know that East Lothian Council has worked very hard with private sector developers and has a version of the Scottish Government’s national infrastructure loan whereby they will forgo or defer capital costs for infrastructure elements of new housing projects in order to go ahead as quickly as possible. There has been a great deal of innovative thinking.

Alex Johnstone (Conservative, North East Scotland)

Will the minister take an intervention?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I will take an intervention, although Alex Johnstone refused to take any.

Alex Johnstone (Conservative, North East Scotland)

I want to ask the minister whether the money used to buy back those houses would have been more effectively used to promote the building of additional houses. If so, the council could have had more property.

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

That would be true if it was an either/or situation. If the member went to speak to East Lothian Council, he would find that it is doing a great deal, despite the particular constraints in that area, to try to encourage further housing development. That in itself will encourage further housing development and add to the council’s housing stock in an area where supply is hard-pressed. I recommend that Alex Johnstone looks in more detail at what is going on in East Lothian Council, as he should at Scottish Government policies, which have been extremely useful in starting to increase the available housing stock.

In conclusion, my amendment acknowledges the points that I have made and recognises the folly of much else in Alex Johnstone’s motion. I move amendment S4M-01346.2, to leave out from “is concerned” to end and insert:

“notes the Scottish Government’s recent announcement that £460 million will be invested to build 4,300 homes as part of its commitment to build 30,000 affordable homes during this parliamentary session, including 5,000 council houses in spite of significant cuts to Scotland’s capital budget by the UK Government; recognises the Scottish Government’s progress in modernising the legislative framework for housing, and calls on the Scottish Government to continue with an innovative approach to housing policy and invest in all types of houses to meet the demands and needs of the population.”

Lewis Macdonald (Labour, North East Scotland)

The Scottish Conservatives might have changed their leader and reshuffled their front-bench team, but there is no evidence this morning of any profound change in their approach to housing policy. That might, of course, suit Alex Johnstone very well. He is on familiar ground, although he seems uncharacteristically shy about engaging in debate today. Perhaps that will change. It might even suit his new leader, who, sadly, has just left the chamber, if her priority is to emphasise old certainties rather than new departures.

It is a shame for those in housing need, however, because they want the focus to be not on the right-to-buy arguments of the 1980s and 1990s but on today’s need for social housing. The Tory motion highlights the record low levels of house building that are an issue in the public and private sectors and in both the owner-occupied and rented sectors. The failure of such a well-established and respected business in the construction sector as A C Yule and Son Ltd in the north-east shows an economy in serious trouble, as yesterday’s unemployment figures confirmed, and shows both the breadth and the depth of the crisis facing Scotland’s construction industry.

Responsibility for that lies in part at Westminster and in part with the SNP Government, not just for its plans to cut support for building new affordable homes but for the complete hiatus in the commissioning of new public sector buildings of every type between 2007 and 2010.

It would therefore have been useful if the Conservatives had chosen to seek a debate on what the Scottish Government should do now, which is not to get rid of existing social housing, but to find ways of building more. However, as Mr Johnstone has chosen to prioritise selling ahead of building, it falls to Labour to highlight the real issues that the housing sector faces. The SNP will claim that all is well—we have heard that from Keith Brown—but the reasons for its unwillingness to address directly some of the issues remain hard to fathom.

The minister’s amendment mentions the Scottish Government’s

“commitment to build 30,000 affordable homes during this parliamentary session”.

His problem is that that was not in his party’s election manifesto only a few months ago. The commitment that the SNP made in that manifesto was

“to build over 6,000 new socially-rented houses each year.”

Mr Brown knows as well as anybody that a target for a total of affordable homes is very different from a target for a total of homes for social rent. That is why his amendment talks of investing

“in all types of houses to meet the demands and needs of the population.”

We are happy to support investing in all types of houses. In government, Labour was as keen as anybody to encourage mid-market rents and rent-to-buy schemes to support those on middling incomes to obtain housing at an affordable price, but mid-market and shared ownership or shared equity are not the same as social renting, and they are not what the SNP promised when it sought election in May.

This is the third time that we have offered ministers an opportunity to explain in the chamber why there is a difference between their commitment in the election campaign and their commitment in government. Labour members have asked the same question in committee, but Mr Brown and Mr Neil have so far refused to tell us why they do not intend to implement the SNP’s manifesto promise.

As I said in our previous debate, I am glad that Mr Brown has now conceded that 20,000 of the 30,000 new affordable homes will be for social rent. That is a distinct improvement on his previous refusal to say anything at all on the subject, but it is a little surprising that the 20,000 homes for social rent do not feature in the Government’s amendment and that they have not featured in the debate so far. Let us hope that Mr Brown is not having second thoughts about that commitment as well. Our amendment is positive about the SNP’s positive commitment in its manifesto and we have offered it another chance to tell us what it will do or if it will do what is needed to make that happen.

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The member mentioned election commitments. Is the Labour Party’s position that which has been put forward by a contender for its leadership, Tom Harris: that allocation by need should be ditched in favour of allocation by virtue? Young people in particular would be put above older people, as they might have a job. Is Labour’s policy what Tom Harris described or what Lewis Macdonald described?

Lewis Macdonald (Labour, North East Scotland)

It is a shame that the minister rose to his feet to respond to my challenge to tell us what he is doing about his manifesto commitment and did not mention it. He did not tell us anything at all. If the SNP does not take the chance to address that matter, attention is bound to focus on the changes in housing policy that it has made, and particularly on the spectacular cuts that it has made in Government funding for new affordable homes.

The Tories have called a debate on the right subject, but they have highlighted the wrong issues. The SNP has talked about what it plans now, but not about what it promised in May. If it wants to, it can move that debate on; all that it has to do is follow our suggestion.

I move amendment S4M-01346.3, to leave out from “notes” to end and insert:

“welcomes the SNP’s manifesto commitment ‘to build over 6,000 new socially-rented houses each year’, and calls on the Scottish Government to bring forward plans to implement this promise and to make a statement to the Parliament at the earliest opportunity.”

Aileen McLeod (Scottish National Party, South Scotland)

I welcome the opportunity to put on record once again my views on the housing situation in Scotland.

In debating the motion, we need to consider the effects on house building and housing of the current UK Tory-Liberal coalition Government’s economic and social policies. As Keith Brown said in his opening remarks, the unprecedented cuts in public spending that the UK coalition Government has implemented are undoubtedly the single biggest cause of the decline in house building throughout the country. If Alex Johnstone is serious about addressing that problem and if he wants to see an upturn in house building, I encourage him to add his voice to the Scottish Government’s demands that David Cameron and George Osborne immediately change course and increase spending on capital projects, particularly on house building.

We should all recognise that housing is fundamentally about people and that social housing is often about protecting the welfare of our most vulnerable and disadvantaged people. If Alex Johnstone is concerned about that, as he seems to be, I again urge him to join us in campaigning against the Tory reforms to housing benefit, which will hit the poorest people in society hardest.

Housing associations the length and breadth of Scotland are telling us that reducing housing benefit is a direct attack on the poor. In a housing debate on 6 October, prior to her elevation to the leadership, Ruth Davidson spoke of first-time buyers’ struggle to get on the property ladder because of the high deposit required and pointed out that people of a similar age to herself—that is, early to mid-30s—were below the average age for getting a first-time buyer mortgage; it tends to be 36 to 37-year-olds who are able to get on the housing ladder for the first time. How, then, can she justify the Westminster-led benefit reforms that will raise the age at which the local housing allowance rate will apply? With that move, 4,400 single people in Scotland aged between 25 and 34 without dependants will be restricted in their ability to apply for housing assistance.

The Conservative motion proposes that the Scottish Government remove the limitations on right to buy that were introduced in 2010. The right-to-buy policy, which was introduced by a Tory Government, has been a disaster in Scotland and has led to more than half a million homes being taken out of social housing stock, leaving councils unable to address housing needs in their areas. Few would dispute that the right-to-buy policy destroyed the council house building programme in Scotland; indeed, the Scottish Federation of Housing Associations has said that it has been absolutely disastrous for the low-cost homes for rent sector.

Instead of voting for a Tory party determined to push social housing stocks down further, leaving less of a chance of getting affordable housing, the people of Scotland voted for an SNP Government that was determined to see through its vision for a fairer Scotland.

Jim Hume (Liberal Democrat, South Scotland)

Will the member give way?

Aileen McLeod (Scottish National Party, South Scotland)

No—I want to keep going.

This Scottish Government has a proven track record not only of investment in housing despite the severe funding constraints—indeed, it has invested £1.7 billion in affordable housing between 2008 and 2011—but of house building. Between 2009 and 2011, 3,295 council houses were approved and, in 2010, 1,055 were started. That is the highest recorded figure in 20 years.

Jim Hume (Liberal Democrat, South Scotland)

Will the member give way?

Aileen McLeod (Scottish National Party, South Scotland)

The Scottish Government is doing everything that it can in very difficult financial circumstances to provide affordable, sustainable and original housing solutions such as the innovation and investment fund, which is building 3,462 new homes, and the national housing trust, which is kick-starting stalled construction sites.

Although I welcome the fact that the Conservative party has brought this important issue to the chamber, its motion simply urges us to turn the clock back and repeat the mistakes of the failed policies of the past. Instead, we must move forward in a spirit of consensus, building on legislation that the Parliament has already passed and continuing to find and develop innovative ways of supporting our affordable housing market.

John Pentland (Labour, Motherwell and Wishaw)

Although we are all concerned about the dire state of house building, I think that we begin to part company over what should be done about the situation. I believe that there is significant and unaddressed demand for social rented housing and shared equity schemes, but both are dependent on Government support that is rapidly shrinking. The housing and regeneration budget will be reduced from nearly £400 million to little over £250 million in 2014, which is a cut of more than 35 per cent. Next year, the affordable housing supply budget is to suffer an even more drastic cut of 53 per cent, falling from just over £268 million to as little as £125 million.

Of course, some of the affordable housing budget is included in the local government settlement but it, too, will be under severe pressure. Manifesto promises and the requirement in the Housing (Scotland) Act 2001 to eradicate fuel poverty by 2016 are unlikely to be met. The pledge to build 6,000 social rented homes each year has become a pledge to build 6,000 affordable homes, just over 4,000 of which will be social rented homes. That is nowhere near enough to meet demand; Scotland needs 10,000 new affordable homes a year.

The 60 per cent decrease in the money for building affordable homes will be achieved by limiting the subsidy to a maximum of £40,000 per unit, but it remains to be seen whether that subsidy will be raised for areas of greater need. Unless it is relaxed, the limit will make it difficult to fund social rented accommodation in areas of high deprivation; if it is relaxed, there will not be enough money to fund the building of as many houses.

The 1,000 intermediate rented homes, available through the national housing trust, are by definition affordable only for some. They are out of reach of the poorest tenants. Another 1,000 are to come from subsidised home ownership. I support the continuation of the open market and the new supply schemes, but I note that the Scottish Government is still not providing funding for the open market scheme. That scheme was assessed as being the best to meet particular needs—for example, the needs of people with a disability—and also as being a particularly cost-effective option. However, it is now available only for a very limited number of homes that are already in the process of being built.

I am also concerned about the future of social housing under the new regime of the housing regulator, which has brought forward proposals that will undermine the role of local residents on the boards and committees of registered social landlords. I am sure that there is no great demand for those proposals from housing associations and residents. In accordance with the tenant consultation and satisfaction principles of the Scottish housing charter, their views should be paramount. Any attempt to impose those new rules will be an attack on local democracy. It will not be acceptable for the Scottish Government to wash its hands and say, “It wisnae me. It was that quango what done it.”

The Government must take responsibility, and not give it away to organisations that it then blames when things go wrong. Instead of trying to fix things that are not broken, the Government should address real problems—such as factors who are withdrawing their services because absentee landlords make their task so difficult. Instead of attacking social landlords, how about the Government giving local government more powers to deal with antisocial landlords?

Jamie Hepburn (Scottish National Party, Cumbernauld and Kilsyth)

If awards were given out for persistence and obstinacy, the Tory benches would be weighed down by bunting and medals. In every debate on housing, they return to the same old chestnut—their obsession with the right to buy. That position flies in the face of the situation on the ground. If the Tories are relying on their record of achievement in the 1950s—as Alex Johnstone seemed to be suggesting—it will be a long way back for the Ruth Davidson-led Tory party.

Alex Johnstone referred to “prejudice” against the right to buy on the SNP benches. I have no prejudice against the right to buy. Indeed, many people in my extended family have exercised the right to buy, although—I do not know whether my stepfather will appreciate my saying this, but I am going to say it anyway—my stepfather’s father refused to buy his council house on a point of principle.

We have to question whether the right to buy was good and sound public policy. The Scottish Federation of Housing Associations has estimated that, as a result of that creation of the Thatcher era, some 500,000 homes have been lost from rented stock in Scotland alone. Many people are languishing on waiting lists for council houses, or for social rented houses, and every member in the chamber will have seen many of them. I question whether the removal of all the houses that would otherwise have been available to them was a sensible policy. The position of the Government—of my party—in relation to the right to buy is not prejudiced but practical.

We are now having to play catch-up in relation to the availability of social rented housing, and the Scottish Government is doing a lot. Members do not have to take my word, or the minister’s word, for that. The Scottish Building Federation has said that

“Between 2007 and 2010, the value of public sector new housebuilding in Scotland has risen by 89 per cent”

and that

“the number of public sector new homes built in Scotland annually has risen by 42 per cent”.

Good work is going on. A significant number of those homes are council houses—the most council houses that have been built for a great number of years. Therefore, the Tory position on the right to buy is a nonsense; it is an absolutely ridiculous position because there would be no incentive for local authorities to continue that council-house building programme if, as soon as they built a house, it became subject to the right to buy. Again, members do not need to take just my word for that. Shelter has said that it disagrees with the Conservative position on right to buy as expressed in the motion today, and the Scottish Federation of Housing Associations has said that the Government’s position is correct.

The Government’s position is coherent; it is designed to protect social rented housing, and it is backed by the people at the coalface—those who work in the housing sector. However, there is a degree of incoherence in Alex Johnstone’s position. He criticises the Government’s position on housing association grant but simultaneously calls for increases to the discount for the sale of council houses. Such a position would not only remove vitally required houses for social rent but would cut money from the public purse.

Lewis Macdonald was right when he said that the Tories have brought forward

“the right subject but ... the wrong issues”.

As Aileen McLeod said, it would have been better if we had been talking about the Welfare Reform Bill and how it will affect housing.

Jamie Hepburn (Scottish National Party, Cumbernauld and Kilsyth)

I look forward to hearing what the minister has to say at the end of the debate.

John Lamont (Conservative, Ettrick, Roxburgh and Berwickshire)

I will use my contribution to the debate to raise an issue that I am sure many MSPs frequently have to deal with on behalf of their constituents: that is, how local councils and other RSLs allocate houses. Before I do so, however, I want to emphasise the importance of house building and construction to the overall wellbeing of the Scottish economy.

According to the Scottish Building Federation, the Scottish construction industry workforce has been reduced by 31,000, or 15 per cent, between 2009 and 2011. Private sector construction has been particularly badly hit, with the consequence that the house-building industry has become increasingly dependent on public sector investment for new work. Those in the sector are therefore concerned by the fact that the Scottish Government’s affordable housing budget faces a cut of 30 per cent between now and 2014-15 and by the impact that that will have on jobs in the construction sector.

As my colleague Alex Johnstone did, I will mention the importance of the right-to-buy policy and the success that it has been for many people in Scotland. We should not forget the sense of pride that people gain from owning their own homes. Home ownership gives people a stake in the maintenance and improvement of their communities and neighbourhoods. It also fosters social mobility and enables people to build up capital. That is why we believe that as many Scots as possible should have the opportunity to share in the benefits of home ownership. They must include those who live in social housing, which is why we have opposed, and will continue to oppose, the restrictions on the right to buy that the Scottish Government has imposed in order to prevent people from exercising that right. None of us should forget that almost half a million households in Scotland have taken advantage of the right to buy since it was introduced in 1980.

The policy is about more than allowing people to own their homes; the Scottish Government could use the right to buy as a means to re-energise the Scottish economy. By increasing the available discounts to encourage tenants to buy their own homes, it would increase the funding that would be available for investment in building affordable homes for people on low incomes, which would also boost jobs in the construction sector. I am pleased that British Government has recognised that, but I am disappointed that the Scottish Government has not.

I will return to the main point of my contribution, which relates to the allocations policy that prevents many RSLs from giving priority to local people when allocating properties. That can often lead to frustration among applicants and anger in communities. Under the current legislation, landlords cannot take into account the length of time for which an applicant has lived in the area. They can give preference to people who reside in the area, but they have to give the same preference to other groups who meet certain criteria—for example, people who want to move into the area to take up employment. We want social landlords, including councils, to be given greater ability to take into account local connections when deciding on housing applications and transfer requests.

The situation is a particular concern in rural communities such as those in my constituency. One issue that has been raised with me time and again is the difficulty that people face when they want to apply for a house within their own community, only to find that they are so far down the housing list that it is impossible. The effect of that is to break up communities, to force young people from the communities in which they have grown up and, in the long run, to increase the average age of people who live in more remote areas, which has an obvious impact on provision of services in those communities.

I am strongly of the view that the Scottish Government should allow social landlords more scope to give extra weight to local connections in allocating houses. That would be a welcome step that would help to ensure that local people have access to local houses. We must do everything that we can to keep rural communities together and to support families who want to move house within their community. Changes to the allocation rules would benefit rural areas such as those in the Borders.

The debate is a welcome opportunity to highlight the importance of the housing sector to the Scottish economy. Even if ministers do not accept our arguments about the right to buy and the importance of the housing sector, the Scottish Government must surely acknowledge the need to help people to stay in their communities by reforming the allocations procedures.

Humza Yousaf (Scottish National Party, Glasgow)

When I read Alex Johnstone’s motion, which extols the virtues of the right to buy, I thought that we were going to be cast back in time to the 1980s. I half expected to see him wearing a leather jacket and one sparkly silver glove and doing a moonwalk across the chamber. For those who like their 1980s movies, I point out that the motion is a bit like “Back to the Future” and even has a ring of “Star Wars Episode V: The Empire Strikes Back” about it.

However, there are no two ways about it—the right-to-buy policy was a disaster for low-cost homes for rent. Those are not my words, but those of the Scottish Federation of Housing Associations, and many more words like them have been used. Under Thatcher’s right-to-buy policy, not only did homelessness increase, but the number of households in arrears on their mortgages shot up from 30,000 in 1983 to 130,000 in the space of seven years.

Let us drag ourselves back to the present reality—an uncomfortable position for some, I am sure. There is no doubt that housing is one of the biggest concerns of many of our constituents. We are all, in Parliament, united in wanting to tackle the shortage of affordable homes, but each of us has a different role to play. I intend to make the case for Glasgow to benefit as much as possible from the Scottish Government’s near £600 million investment as part of its plans to build 30,000 affordable homes. I am delighted that, last year, 1,023 new builds were approved in the city that I have the honour of representing.

As will my colleagues in the Opposition, I will be watching the Government’s progress towards the target of building 30,000 affordable homes. That target is undoubtedly ambitious—but I argue that we have an ambitious Government.

Jim Hume (Liberal Democrat, South Scotland)

Humza Yousaf is going on about 30,000 affordable homes. Does he remember the SNP manifesto commitment to provide 30,000 social rented houses, which is completely different?

Humza Yousaf (Scottish National Party, Glasgow)

Jim Hume is in no position to talk about that. I will come to the Tory-Liberal Democrat coalition Government and the effect that it is having on the housing sector.

Just as I feel that I have a duty to hold the SNP Government to account, do not those in the blue and yellow corner feel the same obligation in relation to their bosses in London? As my colleague Aileen McLeod said, every single member has a duty to speak out against the Tory benefits reforms, which will result in a rise in homelessness in Scotland. As a result of the changes that the Tory Government has proposed, about 55,000 Scots are in danger of losing more than £500 a year, and some as much as £2,500 a year. To call those changes “reforms” is inaccurate and even disingenuous.

Mary Scanlon (Conservative, Highlands and Islands)

Will the member give way?

Humza Yousaf (Scottish National Party, Glasgow)

No, I will not.

The word “reform” suggests progress, useful change and making things better. The welfare changes are not reforms; they are a systematic decimation of housing benefit that will leave the vast majority of those who claim the local housing allowance much worse off. Housing organisations are queuing up to attack the Tory-Liberal coalition. Crisis’s chief executive Leslie Morphy has said:

“This cut will lead to thousands of people losing their homes across the country and Glasgow is among the worst hit. We are extremely concerned that some will end up homeless and at worst on the streets.”

Once again, the Tory-led Government is continuing its crusade on the poorest families and those on the lowest incomes while allowing billions of pounds to escape our shores through tax loopholes for the super-wealthy. It really is a tale of two Governments. In the face of a 36 per cent real-terms reduction in the capital budget from Westminster, the Scottish Government is prioritising affordable homes with the aim of delivering 30,000 of them, two thirds of which are intended to be for social rent.

John Scott (Conservative, Ayr)

You must close, please.

Humza Yousaf (Scottish National Party, Glasgow)

Scotland needs innovation and investment to boost our housing sector; Alex Johnstone’s motion cannot be supported. His cry to reinstate the policies of Thatcher serves to remind us why there are so few Tory members in the Parliament.

Jim Hume (Liberal Democrat, South Scotland)

Last week, the cabinet secretary was again afforded the opportunity to clarify at committee that the Government has reneged on its commitment to build 6,000 social rented houses a year. Like most members, I reacted with astonishment when he described such terms as “irrelevant”. It is not “irrelevant” to establish how many social rented homes the Government plans to provide every year when 156,000 families languish on housing waiting lists. The commitment that we heard today does not mirror the one that is in the SNP manifesto.

Alex Neil (Scottish National Party, Airdrie and Shotts)

Does Jim Hume realise that we inherited that long waiting list because, in the eight years that the Liberal Democrats were in administration with Labour, they built fewer than 4,000 houses a year on average, only about 3,000 of which were social rented houses?

Jim Hume (Liberal Democrat, South Scotland)

The minister is getting a bit confusing and trying to create a smokescreen. [Interruption.] Does he not recall that, under the previous Administration, more than 40,000 housing association houses were built? [Interruption.]

Jim Hume (Liberal Democrat, South Scotland)

The number was 40,000 plus houses, if the minister did not hear. He has a long way to go before he can criticise the Liberal Democrats.

A significant supply of new homes being available for social rent is vital if Scotland is to fulfil its commitment to giving every unintentionally homeless person the right to a home by 2012. The 4,300 homes that have been referred to—74 per cent of which will be social rented houses, I believe—are a welcome start, but we have a long way to go until we get the other 25,700.

When the Cabinet Secretary for Finance, Employment and Sustainable Growth introduced his draft budget and spending review to the Parliament, he said:

“I am delighted to announce that the spending review marks a decisive shift towards preventative spending in Scotland”.

He went on to say that the Government’s shift in spending priorities respected

“the parliamentary consensus that exists in that area.”—[Official Report, 21 September 2011; c 1925.]

Unfortunately, we have recently learned that the budget that was supposed to herald a “shift towards preventative spending” contains a proposal to cut the housing adaptations budget for registered social landlords from an already modest £8 million to only £6 million. I understand the financial pressures on the Government, but that significant 25 per cent cut is disproportionate and seems to contradict the Government’s commitment to preventative spending.

The nationalist members are quick to blame others for every reduction that the Scottish Government announces, but each week we hear announcements for initiatives that the Government is extending or introducing for the first time. For example, on 13 October, the Government announced the extension of funding to the open-market shared-equity scheme to the tune of more than £4.5 million. That is a worthwhile project, but it is clear that when an initiative that is to the Government’s liking requires funding, a pot of money is found somewhere.

The Government was not forced to cut 25 per cent of the housing adaptations budget: it chose to do so. Adaptations are an example of effective preventative spending. They keep thousands of Scots living in their own homes and lead to substantial savings in the long term. An independent study revealed that for every £1 that is invested in stage 3 adaptations, the Scottish Government could benefit from a total social return on investment of between £5.50 and £6.

I recently met affected housing associations, which informed me that there is a real prospect of their having to raise rents or stop providing adaptations altogether. Naturally, that will apply more pressure on the national health service, councils and the third sector.

The Government needs to admit that it got that decision wrong and reverse it. I look forward to the cabinet secretary or the minister referring to that in his closing speech.

Margaret McDougall (Labour, West Scotland)

I draw the Parliament’s attention to the Infrastructure and Capital Investment Committee meeting of 9 November, at which the Minister for Housing and Transport almost admitted that the SNP made a mistake when it committed in its manifesto to building 6,000 social rented houses a year. We all know that that has changed to 6,000 affordable new houses a year. As we have heard repeatedly, that is a different thing from social rented houses. Why is it so hard for the Government to admit that it made a mistake and could not deliver what it originally promised in its manifesto?

As I have said in previous debates, housing is the single biggest loser in the draft budget. Still, no action has been taken to correct that. The Government will cut funding by 63 per cent over the spending review period, but the number of affordable houses that are to be built will be cut by 16 per cent. Does that mean that the quality of the houses that are built will suffer?

Jamie Hepburn (Scottish National Party, Cumbernauld and Kilsyth)

Will the member give way?

Margaret McDougall (Labour, West Scotland)

I am sorry. I have no time to take interventions.

Will higher rents be charged in the long term to recover the cost? The registered social landlord subsidy has been cut from £77,000 in 2009 to £40,000 this year. Much higher rents are likely to be charged to cover borrowing costs. Shelter argues that, although that is a viable short to medium-term solution, extending it over a longer period would mean significant rent increases. Has the Government carried out affordability tests to gauge whether the likely increase in rents will be within hard-pressed tenants’ means? That is even before the new housing benefit reforms come in.

Less funding for new social rented homes is, of course, having a detrimental effect on the construction industry, which employs 127,000 people in Scotland.

Jamie Hepburn (Scottish National Party, Cumbernauld and Kilsyth)

Will the member give way?

Margaret McDougall (Labour, West Scotland)

I am sorry, but I just do not have time to take interventions.

The construction industry involves a further 63,000 self-employed people. Between April and June, 10,000 Scottish construction workers lost their jobs and a total of 30,000 jobs have been lost since March 2009.

The fall in the number of houses that are built not only reduces the supply of new housing but puts people’s jobs and livelihoods at risk. While youth unemployment is at its highest level since 1994, the Government is reducing the availability of modern apprenticeship places in construction. That is, of course, a major blow to modern apprenticeships, because between April and December 2010, 32 per cent of all modern apprenticeships were completed in the construction industry. I ask the Government again whether it thinks that it is wise to put further pressure on the construction industry and to put the economy at risk by hitting housing so hard.

It is not just housing that will be affected by the cuts—they will have far-reaching social consequences. In the past few weeks, the Government’s response to criticism of the budget has been to ask Labour members for alternatives. Has the Government considered using the £67 million in Barnett consequentials that were gained from the English council-tax freeze to boost the supply of affordable social housing?

I again urge the Government to re-examine the draft housing budget. We urgently need to breathe life into the construction industry and to get it back on its feet. If we do not, more jobs and more modern apprenticeship places will be lost and the construction industry will be deskilled.

Housing is a basic human need and the Government must give it priority.

Derek Mackay (Scottish National Party, Renfrewshire North and West)

Once again, we hear not positive contributions but yet another whinge from the Labour Party. I look forward to seeing exactly what their priorities are, if Labour members ever produce an alternative budget.

Lewis Macdonald (Labour, North East Scotland)

Will the member take an intervention?

Derek Mackay (Scottish National Party, Renfrewshire North and West)

Labour members have not managed to produce anything in their 20 or so minutes.

At least the Conservatives offer a position on housing for members to consider. Mr Johnstone is a reasonable man—I am disappointed that I will no longer sit beside him in the Finance Committee—so I gave his speech, and particularly his comments on the right to buy, some thought. I know that a film will come out shortly that reminisces about and romanticises Margaret Thatcher, but the Conservatives have shown that they are ahead of the curve—for the first time in a while—because they want to romanticise some of her greatest policies.

The right to buy may have had some attributes. Arguably, it transferred some resource.

Mary Scanlon (Conservative, Highlands and Islands)

Will the member give way?

Derek Mackay (Scottish National Party, Renfrewshire North and West)

I would like to make more progress.

The right to buy involved an asset transfer to people who might not otherwise have had access to capital. The problem is that the asset transfer was not from the rich to the poor but was, in many ways, from the poor to the poor. The right-to-buy discounts that were offered have been paid for through debt that was left with the remaining tenants, who have paid through their rent and, arguably, through a lack of investment.

The right to buy was not a useful tool for targeting housing investment and resource either. We know that it was taken up more in popular areas, or areas of higher demand. Rather than housing that is fit for heroes, which was the original concept of council housing, we are left with housing for the poor—in particular, the working poor.

The argument that if we were to extend the discounts many people would take up the right to buy—because they can afford it and are just waiting for the moment—is ill informed, because two thirds of people who are currently in council housing rely on housing benefit, which is also under threat, thanks to the UK Government’s Welfare Reform Bill. We would end up with a further mismatch between housing provision and what people aspire to and require.

As Jamie Hepburn said, a number of people have taken up their right to buy—I am aware of some former militant MSPs who took up their right to buy, despite their principled opposition to it. I am not, for pragmatic reasons, happy about the right to buy because it has not helped the housing situation in Scotland. The discounts were such that the debt burden increased and the impact on housing departments has been significant.

I am glad that John Lamont touched on the local connection issue. There might be more of an issue in rural areas, but there is something quite sinister about a housing policy that starts with, “You’re not from round these parts, are you?” The Conservatives have to consider carefully what they mean by local connection, because more than 50 per cent of housing applications come from homeless people. How do we establish what their local connection is? There could be just a parochial analysis of who should be allocated housing. Surely we should allocate it on the basis of need, which must be the over-riding concern when it comes to housing.

Neil Findlay (Labour, Lothian)

Will the member take an intervention?

Derek Mackay (Scottish National Party, Renfrewshire North and West)

Yes.

Derek Mackay (Scottish National Party, Renfrewshire North and West)

Further emphasis has to be placed on investing in the innovative package that the Government has created around mixed use, mixed tenure and a range of funding packages to ensure that new homes are built. Crucially, we must invest in the houses that currently exist so that they are sustainable.

The Liberal Democrats mentioned the number of people on waiting lists. What they said is true, but we must ensure that the homeless are accommodated first. A large proportion of the 140,000 on the lists do not want to move; they are looking for a step up—it is aspirational. For some, that might be about improved housing and for others it might be about larger housing. A step backwards to enhance discounts for the right to buy, which would be disingenuous, misdirected and not affordable, would be the wrong step to take.

Lewis Macdonald (Labour, North East Scotland)

Boosting jobs and training in the construction industry, providing good-quality houses for sale and for rent, preventing homelessness, tackling fuel poverty, challenging antisocial behaviour, cutting carbon emissions and growing the Scottish economy are all objectives of a Scottish housing policy that I suspect every party in this chamber would say it supports. The Tories alone say that the key to achieving those objectives is to extend the right to buy and to sell more houses in the social rented sector into the private sector in order to create capital receipts to pay for new homes. As we have heard, nobody else believes that.

The key to affordable housing is not, in fact, to sell off the housing that we have, but for there to be Government investment. The need for social provision of housing comes from market failure, on which only Government can intervene on a sufficient scale to resolve it. That is not to say that Government needs to act alone. Innovative funding mechanisms and new kinds of public-private partnership can help lever in additional funds and get more houses built. If they do so, we will welcome it.

To sell more rented homes into the owner-occupied sector is not the best way to find the funds. If there is a debate on the right to buy it should be on whether we need to do more to limit the loss of homes from the social rented sector rather than on how to remove the limits that already exist.

Whatever the leveraging opportunities, it is still for Government to take a lead if market failure in housing is to be addressed. That is why we are so concerned by the cuts that the Scottish National Party has already made in the funding of affordable homes. As the Scottish Federation of Housing Associations noted in its evidence on the draft budget and spending review:

“The overall amount of funding available for new investment ... has been cut by over 30% in 2011-12 and subsidy levels were cut by around 48%. This has become unsustainable.”

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I will ask Lewis Macdonald a question that I have asked before. If he believes that the housing budget should be increased, can he say by how much and from where that money should come?

Lewis Macdonald (Labour, North East Scotland)

I am addressing a decision by the Scottish Government to reduce the housing budget radically when it should be looking at what it can do—we have heard some suggestions this morning—to increase the level of support.

It is no coincidence that the benchmark level of subsidy per house has gone down at the same time as the overall level of funding has gone down. Over the spending review, Alex Neil proposes to cut the total funding for the housing budget by half. Those proposals have come from ministers and ministers are responsible for them. They are also responsible for the fact that the number of new houses started by housing associations fell from some 6,500 in 2009-10 to barely 4,500 in 2010-11—a cut of nearly 30 per cent—with worse to come. It is little wonder that ministers want to stop being judged by the achievement of targets for the approval of new homes and instead to start counting completions, because that will allow them to count for a second time homes that were begun before they started their current funding squeeze.

Those are the real issues for the funding of housing policy in Scotland, and the challenge is how to find the funds to enable building of houses. However, in order to deny the fact that they are making cuts, ministers are setting targets and providing subsidies in such a way that the outcomes will be more homes for mid-market rent or sale, and fewer homes for rent at a level that people on low incomes can afford. Rather than extend the right to buy, we should protect the right to rent; in that way, we really could lift people out of poverty, build more homes and grow the economy. The real housing challenge for the Government is to invest more, not less, and to concentrate support on those who need it most by honouring the promises that it made in its election manifesto.

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I will use my closing remarks to say more about the strategy for tackling the problems that Alex Johnstone’s motion describes in part but, unfortunately, appears to have no solution to. His reference to “homes fit for heroes” after the second world war was at least 20 years out of date, as that initiative took off after the first world war. However, the fact that he was 20 years out of date seems to reflect the nature of the proposals in the motion.

I will also focus on action that is being taken to increase supply across all tenures. There is, rightly, an understandable emphasis on the inputs—how much money is going in. However, we must focus much more on the outputs—the number of affordable houses that are being built. That is the direction taken by Government policy. We recognise the connections between different tenures—how they can impact on one another—and the critical importance of supply to Scotland’s economic recovery and future growth.

Reference has been made to the challenges that exist in the construction industry and how much money is in the economy. It is interesting to note that more than £100 million will be removed from the economy generally as a result of the changes to the local housing allowance. The Conservatives and Liberal Democrats are responsible for that but made no reference to it in any of their speeches.

It is our job to make our funds work harder and deliver more affordable housing at lower cost and for greater value to the public purse. To that end, we have tried to encourage housing associations, developers and local authorities to work together to deliver housing that meets their communities’ needs; to make better use of the existing housing stock to improve choice and quality for households; and to help to deliver our ambitions for tackling climate change.

John Lamont talked about meeting local needs and allowing extra weighting for local connections. We have listened to that point and will start consultation in January on allocations. Nevertheless, I agree with Derek Mackay that we must be aware of the dangers of such an approach. A recent trend has been to ensure that veterans do not require the same number of points for local connections, as they do not establish those during their time in the service. There are difficulties with that approach, and some of the points that Derek Mackay raised are well worth bearing in mind. We will consult on the issue.

Increasing the supply of affordable homes remains our top priority. However, we could be so much further down the road in terms of the money that is available to us had successive Labour and Conservative Administrations, when tenants decided to keep their stock with the council rather than transfer it, treated both types of debt equally. Addressing homelessness and affordability issues is a vital part of our effort to build a better and fairer Scotland as we continue to regenerate our most deprived neighbourhoods.

Our target—which I have set out several times—is to deliver 30,000 affordable homes, completed by the end of the current Parliament. As one of the SNP speakers said, that is a challenging target. We understand that—it will not be an easy target to achieve. However, I am a bit puzzled by the different versions of what happened in the previous eight years.

Jim Hume (Liberal Democrat, South Scotland)

Will the member give way?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

Just a second—I am just going to mention Mr Hume. He talks about the building of 40,000 housing association houses in those eight years. However, yesterday, Patricia Ferguson told us that fewer than 32,000 were built, which is fewer than 4,000 a year, with just over 3,000 of those being for social rented accommodation. There seems to be some doubt about the numbers. Perhaps we will get some clarity and consistency on that in the future.

Lewis Macdonald (Labour, North East Scotland)

Will the member give way?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

In a minute.

We are working towards our target, despite the cut in capital spending. It is rich to hear Mr Hume talk about a 25 per cent cut to the housing adaptations budget. Can he not refer to the 36 per cent cut in the capital budget? Does he not recognise that that produces pressure in all our budgets? He says that we have gone looking for those cuts, but that is not the case. We are having to adapt to the cuts that have been imposed by Westminster.

Jim Hume (Liberal Democrat, South Scotland)

Will the member give way?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I will take an intervention from Mr Macdonald.

Lewis Macdonald (Labour, North East Scotland)

I offer the minister a further opportunity to address the point that I thought he was going to address when he intervened during my speech, which concerns the SNP’s manifesto commitment to build 6,000 social rented housing units a year. Does he have any intention of fulfilling that promise?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

Unlike Lewis Macdonald, who did not answer my question about whether Labour was about to ditch allocation on the basis of need, I have answered that question here and in committee on a number of occasions, as has Mr Neil. It is up to Lewis Macdonald whether he chooses to listen to those answers.

Along with the commitment to more affordable housing—30,000 affordable homes over the five years of this session—I have been able to announce a doubling of investment in new affordable homes through the investment and innovation fund. Through an input of £111 million, we are producing more than £400 million of investment in our housing stock. That is the kind of result that we want to see, and it means that local authorities in Scotland are building almost as many council houses as the rest of the UK combined—5,000 over the next five years. Lewis Macdonald should compare that to his Government’s record and then think about whether he should criticise what we are doing on council house building.

Private developers are taking advantage of opportunities that are offered through the national housing trust and our support for shared equity. A great deal is being done.

As I said, one of the major elements that affect the issue that we are talking about is the housing benefit changes that have been announced. We have conducted a detailed analysis of the impacts. We know that housing stakeholders will have to deal with the reforms and that there will be major pressures on landlords. We have tried to deal with that. Accordingly, I am happy to announce today Scottish Government support for three strands of activity. This year, we will spend £100,000 through the Chartered Institute of Housing, the Convention of Scottish Local Authorities and the housing options hubs. That money will be spent on the development and sharing of best practice across the social rented sector, adding to the capacity of those at the sharp end at a critical time.

We are taking positive action to try to deal with the cuts that have been imposed by Westminster and I would like the other parties to come forward with positive suggestions. I hope that that will happen in the next housing debate, because it has not happened today.

Margaret Mitchell (Conservative, Central Scotland)

This has been a worthwhile and revealing debate. I will start by dealing with the things in the Conservative motion that are not in dispute. We are all agreed that the housing market is pivotal to the Scottish economy. Equally, there is no dispute about the fact that house building in Scotland has fallen to a 30-year low, nor is there any disagreement about the need to ensure that there is an adequate supply of good-quality affordable housing to buy and rent in the private and social sectors. It is a fact that the housing and regeneration budget suffers from the second-largest cut in the Scottish Government’s spending review. It has suffered a cut of £96 million—or 25 per cent in real terms, as Jim Hume pointed out in the amendment that he lodged—which is certainly of concern to at least three out of the four main parties.

The SNP’s response is very upbeat. Apparently, the pinnacle of its success is that it has built more social housing than the Labour-Liberal Democrat coalition did. What the SNP cannot say is that it has built more than the Conservatives did. That record number was achieved through aspirational policies such as the right to buy, which was introduced by the Conservatives in 1980 and scrapped last year by the SNP, despite the fact that the receipts from sales under the right to buy were used to modernise houses and build new houses.

Jamie Hepburn (Scottish National Party, Cumbernauld and Kilsyth)

Will the member give way?

Margaret Mitchell (Conservative, Central Scotland)

I am afraid that I have heard Mr Hepburn’s views on housing all too often, and he has nothing new to add this morning.

The SNP wants to take its political dogma to new heights, praising the SNP-Liberal Democrat East Lothian Council proposal to buy back former council houses. That is a deeply flawed proposal, despite what Keith Brown asserts. It is retrograde and it does not represent value for money at a time when local authorities are under severe financial pressure. Worse still, it contradicts everything that the SNP Government has told us that it wants to do nationally in terms of boosting the economy by supporting jobs in the construction industry. So there we have it: the SNP says one thing locally and another nationally.

Jim Hume (Liberal Democrat, South Scotland)

Will the member give way?

Margaret Mitchell (Conservative, Central Scotland)

If Mr Hume does not mind, I will not, as I am the only member who is concentrating on what our motion is about—no one else has done so.

I turn to the next part of our motion, which is on the need for legislative reform, not just to reinstate the right to buy and to address local connections, but to deal with the growing and vexing problem of homelessness. The homelessness legislation creates local tensions, because young couples and others wait patiently for accommodation—in some cases, for years—trying to build up points to improve their prospects, only to be pushed further and further down the waiting list. It is not in dispute that the ever-increasing numbers of homeless people get precedence over them.

As of March 2011, there were 156,200 applicants on local authority waiting lists. Furthermore, during 2010-11, 43 per cent of the available social lets were for the homeless. An analysis of those applicants reveals that 62 per cent of them were single people, 24 per cent of them were single parents and only 31 per cent of them were households with children. Although many of those applicants should be and are a priority for housing, many of them should not be, including those who have a record of causing chaos in their communities and who come under the banner of antisocial tenants.

Claudia Beamish (Labour, South Scotland)

Will the member take an intervention?

Margaret Mitchell (Conservative, Central Scotland)

Perhaps later.

That brings me to the final part of the motion, which is on antisocial tenants. Antisocial behaviour has been ignored by every other party in the chamber, yet, as every elected member knows, it is a major problem in every constituency. Therefore, it defies belief that statistics on the use of antisocial behaviour orders and other antisocial behaviour remedies are no longer collated. That is because, in 2008, the SNP Government decided to develop a voluntary performance framework instead, with an annual report being made to Parliament on progress—or lack of it—towards the implementation of the promotion of positive outcomes. That represented a change in direction from enforcement and punishment of crimes to prevention and early intervention. The only problem is that, to date, there has been very little evidence of early intervention or prevention strategies delivering for people who are suffering from the blight of antisocial neighbours.

I will give one example, which, appallingly, is not uncommon. A constituent of mine has lived in her flat for 16 years. She works during the day and has an evening job. The past three and a half years have been, in her words, “a living hell”. Why? Because three and a half years ago, a 17-year-old girl was allocated a house in her block of flats, where the tenants had all looked after common property and had lived in harmony for many years. That individual does not work, so it has been party time, with loud music into the early hours and a constant stream of young people coming and going.

If that was not bad enough, a 17-year-old male, also unemployed, was allocated housing in the same block of flats. The result is that what was a well-kept council property has had its security doors ripped off and fights are commonplace, with walls being left smeared with blood. A constant stream of teenagers come and go late into the night and the early hours of the morning, urinate on the stairs and are usually so drunk that they shout through letterboxes completely unaware of which flat they are trying to access. That is a terrifying experience for my constituent, who lives alone. Sleep is impossible. The lady in question, who has never been ill or taken a day off work in her life, has had to visit the doctor, who has prescribed antidepressants such as Valium, which she does not want to take—and why should she have to? I do not need to go on. It is clear that that situation does not make any sense from a human or an economic perspective. There is absolutely no evidence of early intervention or preventative spend there.

What is evident is that the SNP Government, which has been in power for almost five years and which presides over local government and housing policy, has done nothing to ensure that tenancy agreements are enforced by local authorities so that, at the first sign of trouble, respectable, law-abiding tenants know that officials are on their side. The Government has also done nothing to ensure that allocation policies are proportionate and sensible and that they protect the elderly and other tenants.

The debate has exposed the extent to which the SNP Government’s warm words about early intervention and preventative spend are, in practice, a sham. More significantly, it has made clear the real priorities of the SNP, Labour and the Lib Dems, all of whose amendments seek to delete the motion’s reference to antisocial behaviour. Indeed, Lewis Macdonald and Jamie Hepburn dismissed the topic as being the wrong one to concentrate on. The clear and indisputable message to honest, hard-working tenants and families in Scotland who merely want to live in decent housing and in peace is that, if those parties are not prepared to make tackling antisocial tenants a priority, the Scottish Conservative and Unionist Party will do that. Quite simply, we are on their side.

Public Sector

John Scott (Conservative, Ayr)

The next item of business is a debate on motion S4M-01348, in the name of Mary Scanlon, on the role of the public sector.

Mary Scanlon (Conservative, Highlands and Islands)

I begin by acknowledging the valuable contribution that the public sector makes to the economy and society in Scotland. It is that hugely valued contribution by public sector workers that makes the potential strikes so devastating, particularly for the most vulnerable. Public sector staff make their contributions in their working lifetimes, and their pensions should be based on fairness, quality and sustainability in retirement. I understand that this could be the first focused debate on public sector pensions in the Parliament, although I appreciate that we are the warm-up act for the Government’s debate on pensions in two weeks’ time, for which I fully commend the Government.

Earlier this week, the Scottish Parliamentary Corporate Body agreed to progress to the next stage of the external security facility to ensure that democratic business continues in the Parliament despite any security threats. I hope that all parliamentarians will ensure that their duties within this democracy and Government continue on 30 November should the strikes go ahead while negotiations continue.

In five years’ time, the United Kingdom is due to spend £33 billion a year on public sector pensions. That is the same as the budget for the Scottish Parliament. Any politician who thinks that the figure can continue to rise must be explicit about where the money will come from. There is no doubt about the urgent need for reform against the background of people living much longer than when the funds were set up. Labour’s legacy was state spending of £4 for every £3 in revenue, with the UK Government having to borrow £1 in every £4 just to keep the lights on, pensions paid, teachers in schools and doctors and nurses in hospitals. That simply cannot continue, given the huge national debt, of which we are all aware.

The former Labour minister Lord Hutton reviewed pensions in the UK and concluded that there is a clear case for change. He stated:

“The responsible thing to do is to accept that because we are living longer we should work for longer.”

I also agree with Rachel Reeves, Labour’s shadow chief secretary to the Treasury, who set out three key tests for a fair agreement on pensions: affordability, fairness and sustainability. I believe that the current proposals, which are under negotiation, meet those three tests. While I am being consensual, I also agree with Ed Miliband, who described strike action while negotiations are on-going as a “mistake”.

Neil Findlay (Labour, Lothian)

Will the member take an intervention?

Mary Scanlon (Conservative, Highlands and Islands)

I will make some progress, if the member does not mind.

As recently as 2 November, the UK coalition Government placed a new offer on the table of an 8 per cent increase in the accrual rate, and it is committed to continue working constructively with unions for a settlement.

Having read the Labour amendment, I think that it is important to set out the facts. Most public sector workers will see no reduction in the pension that they receive on retirement, with many low and middle-income earners receiving a larger pension income on retirement. Any worker within 10 years of retirement will see no change to the age at which they can retire and no change to the amount of pension that they will receive when they retire.

After all the reforms, people in the public sector will still have significantly better pensions than those in the private sector, especially given the former Labour Government’s tax raid on private pension funds of around £5 billion a year, which took up to £100 billion out of private pension funds.

It is obvious that Scottish Labour has not read or understood Lord Hutton’s report, so let me give some examples of the proposals.

Richard Baker (Labour, North East Scotland)

Will the member take an intervention?

Mary Scanlon (Conservative, Highlands and Islands)

I would like to give some examples so that I can put the member right.

A nurse with a salary at retirement of £34,000 would receive a pension of £23,000 if the reforms were introduced; under the current scheme, they would receive £17,000. A teacher with a salary at retirement of £38,000 would receive £25,000 under the proposed scheme; under the current scheme, they would receive £19,000. A hospital porter with a salary at retirement of £14,600 would receive pension benefits of £12,000 under the new scheme, as opposed to £9,000 in the existing scheme.

Perhaps Labour is going on strike because some people will receive less. A senior civil servant, of whom there are many, with a salary of more than £100,000 would receive £37,000 under the new proposals compared with £44,000 at present. The hospital porter’s pension increases, whereas that of the top civil servant is reduced. The lowest paid and people who are 10 years from retirement will be protected and public sector pensions will remain far better than those in the private sector.

It is worth noting that the settlement will not require further negotiation for a generation. The Government is not proposing any increase in the total employee scheme contribution rates in addition to the proposed 3.2 percentage points already announced.

We value the contribution of the public sector, but it is worth comparing public sector pensions with those in the private sector, which is so critical to the recovery of our economy. After the proposed reforms, public sector pensions will still be among the best, with a guaranteed pension that very few in the private sector could ever dream of.

In February this year, an Audit Scotland report highlighted the differences in contribution rates and levels among public sector schemes. There is no doubt that the Scottish Government will have to tackle the issue soon. I welcome the last line of the Scottish Government’s amendment—it is probably the only line that I agree with.

The Scottish Conservatives encourage constructive debate and chose this subject for debate as there needs to be an open and honest discussion as well as a more realistic approach to public sector pensions. The Prime Minister has given a commitment to members of Parliament at Westminster that they should face exactly the same changes to their pensions as those imposed on public sector workers.

We should remember that, without reform, public sector workers would retire much earlier than private sector workers. Is that fair? Two thirds of private sector workers are not even members of any pension scheme.

The taxpayer contributes three times more to civil service employees’ pensions than the average private sector employer pays into its employees’ pensions. Is it right and fair that private sector employees contribute through taxation to a pension scheme that is far more generous than they could ever dream of?

Richard Baker (Labour, North East Scotland)

I am glad that Mary Scanlon has given me an opportunity to make my point so that she can establish whether I am wrong before she replies to it.

Mary Scanlon talked about Lord Hutton’s recommendations. He said that the move from the retail prices index to the consumer prices index would result in a 15 per cent cut in pension benefits not just for people in public sector schemes but for people in private sector schemes. Does she think that that is fair? Does she agree with Lord Hutton that that move represents a significant cut in benefits in private pension schemes?

Mary Scanlon (Conservative, Highlands and Islands)

I appreciate that, Presiding Officer.

When it comes to a cut in pension scheme benefits, the biggest cut that anyone could ever see is the £100 billion that Gordon Brown took out of the private sector and occupational pension funds, which affected people the length and breadth of Scotland.

On 30 November, instead of Labour members standing shoulder to shoulder with the strikers outside the Parliament, they should be face to face with people across Scotland, apologising for the £5 billion annual raid on private sector and occupational pension schemes, which reduced the tax value of those funds by more than £100 billion.

I move,

That the Parliament recognises the very valuable contribution that the public sector makes to the economy and society; accepts that, while government has an obligation to ensure that public sector employees are well rewarded with good quality pension schemes, there is an urgent need for reform, believing that the proposed reforms will ease the burden on taxpayers and still leave public sector employees in a far better position than their counterparts in many private sector schemes, and further believes that the planned strikes by the unions on 30 November 2011 are a deeply irresponsible action at this time and will do nothing to help Scotland’s recovery from the recession.

John Swinney (Scottish National Party, Perthshire North)

It is a pleasure to speak on behalf of the Government in this debate and to begin by welcoming Mary Scanlon to her new post. This is new territory indeed—it will be a novel experience for those of us on these seats who are accustomed to debates on the economy to face Mary Scanlon. I am glad that the reshuffle has provided us with Mary Scanlon.

I was a bit surprised by the title of this debate, which was advertised last Thursday as “The Role of the Public Sector”. I thought that we would perhaps be treated to the early thinking of the new Conservative leadership in Scotland on the approach that we should take to running our public services—an explanation of why the Thatcherite reforms that have been taken forward south of the border, involving the privatisation of the national health service, are the way that we should proceed in Scotland. But, no, the Conservative party has returned to form and, rather curiously, has focused on a particular aspect of the role of the public sector, which is of course the live and important topic of public sector pensions. I will come on to discuss some of the issues in that regard.

Neil Findlay (Labour, Lothian)

I thank Mr Swinney for mentioning the new Conservative leader. Given the nature of this debate, is he aware that not long ago the new Conservative leader was apparently a placard-wielding striker at the BBC?

John Swinney (Scottish National Party, Perthshire North)

That just goes to prove that every individual has a right to protest and to strike and, moreover, to change their mind about these issues.

Patrick Harvie (Green, Glasgow)

I am grateful that the cabinet secretary reminds us that every individual has the right to change their mind. Will he urge the Cabinet Secretary for Parliament and Government Strategy to change his mind about the proposal to schedule a debate on public sector pensions that is specifically timed to ensure that only MSPs who cross picket lines can participate?

John Swinney (Scottish National Party, Perthshire North)

No, I will not encourage the cabinet secretary to change his mind, because it is entirely appropriate that Parliament sits on every day that it is due to sit and addresses issues that matter to and affect the people of our country. I look forward to savaging on 30 November the Conservatives and the Liberals for their approach to public sector pensions. I will use the opportunity of that occasion in Parliament to do exactly that. It would be helpful if Mr Harvie was here to add his voice to the arguments in that respect. [Interruption.]

John Swinney (Scottish National Party, Perthshire North)

Before we move on to pensions, I want to spend a few moments discussing the public sector. Despite all the warm and considered words in Mary Scanlon’s opening remarks, she then went on to attack public sector workers in virtually everything else that she said.

I want to make it clear that the Scottish Government values enormously the contribution made to our public services by public sector workers. We are committed to a process of public sector reform that is predicated on four principal themes: integrating public services at a local level; ensuring that we enhance the development of our public sector workforce to maximise its capability and effectiveness at a time of financial constraint; ensuring that we have an open, transparent and rigorous performance culture that challenges public services to improve their performance and boost the outcomes for members of the public; and, crucially—this is for the benefit of Margaret Mitchell—focusing extensively on preventative intervention. Any analysis of public sector reform and the condition of our public services demonstrates that unless we intervene early to arrest some of the long-term problems that affect individuals and circumstances in Scotland, we will continue to have significant burdens on public services that will be difficult to meet.

Margaret Mitchell (Conservative, Central Scotland)

Does the cabinet secretary agree that although focusing on preventative spend is all very well, what really matters is outcomes, and that that is where this Scottish National Party Government is failing dismally?

John Swinney (Scottish National Party, Perthshire North)

That is just complete and total rubbish. If Margaret Mitchell looks at the Government’s national performance framework, which she derided in her earlier speech, she will see a programme of constant improvement in the effectiveness of public services. The Government will continue to focus on that to improve the outcomes for the people of our country, and we will challenge vigorously any attempts to misrepresent the focus on preventative spending in the way that Margaret Mitchell has done.

I have set out very clearly the Government’s disagreement with the United Kingdom Government’s approach to public sector pension reform. There is a clear argument, which is at the heart of the Government’s amendment today, that all public sector pensions should be “fair, sustainable and affordable”. We accept that argument and we believe in Lord Hutton’s proposal that there is a great deal of substantive and considered thinking to be done about how to approach the long-term sustainability of public sector pensions.

The problem is that the approach to that debate, which by its nature must be focused on negotiation and agreement with trade unions, has been contaminated by the cash-grab of the 3.2 per cent increase in pension contributions that has been required by the UK Government. That has made the debate on the question of public sector pension reform all the more difficult to sustain because, essentially, it has added a financial burden on public servants who already face acute financial challenges at this time. That is why the Government has set out its opposition to that proposal. Our ability to do something different in Scotland is constrained by the UK Government’s threatening approach, as it says that it will reduce our budget if we do not accept the increases in contributions that its proposals require of us.

The Scottish Government will welcome the opportunity at the end of this month to set out in more detail and over more time all our thinking on public sector pensions and to make clear and reinforce the many areas in which we disagree with the UK Government’s approach. I stress the importance of our continuing dialogue with employer representatives and trade unions to ensure that we have a sustained approach to public sector pension reform.

We accept and understand the reasons why people feel the necessity to strike at this time. We do not agree with that action, because we believe that dialogue should be the way that we proceed.

John Swinney (Scottish National Party, Perthshire North)

The Scottish Government will firmly set out to Parliament on 30 November our principal reasons why the UK Government is taking the wrong course. We will make that position abundantly clear to Parliament.

I move amendment S4M-01348.2, to leave out from “accepts” to end and insert:

“believes that pensions must be fair, sustainable and affordable; considers that the 3.2% increase in contributions proposed by the UK Government is a cash grab that has more to do with deficit reduction than fair pensions; acknowledges that these increases come at a time when households are under financial pressure due to rising costs, and encourages the Scottish Government to continue to engage in full and extensive dialogue with trades unions and employers’ representatives on the future of pension provisions.”

Richard Baker (Labour, North East Scotland)

I, too, welcome Mary Scanlon to her new post, but I must say that the Conservative motion today might be best described as a “Life on Mars” motion. While everyone else is looking for the way forward to steer Scotland from recession, the Tories are harking back to the 1980s and their disregard for the trade union movement. I note, however, that not only did Ruth Davidson strike in her previous career as a journalist, she seems to be boycotting parliamentary business already. She is just out a week early; perhaps she will be out with us on 30 November after all.

The decision to raise the issue of public service pensions as part of Tory business today merely highlights the failure of the Tory-Liberal coalition to deal properly with pension reform. Instead of working in partnership with the trade unions to try to reform and future proof pensions and ensure decent provision for workers in retirement—we agree with what the cabinet secretary said about the potential in the Hutton proposals—we are being treated to one of the worst-handled negotiations in Government history. We still hope that action can be averted by sensible negotiations between the Government and the trade unions, but thus far there have been months of dither and delay by the UK Government, and we are still waiting to be told what many of Danny Alexander’s most recent proposals mean in detail.

Let us be clear: the unions understand that pension reform is needed. Every trade union takes the position that pensions need to be looked at in a fair and progressive way, but we have seen a series of botched announcements from the coalition, which concluded with Francis Maude’s latest brainwave that the unions could go out on strike for 15 minutes and the Government could then carry on with business as usual, as it were. Mary Scanlon neglected to refer to the change from the RPI to the CPI for the uplifting of pensions, which will have a serious effect; the required 50 per cent increase in annual contributions; the fact that those increased pension contributions will be required for up to eight years longer; and that pensions will be payable to retired workers for up to eight years fewer. Very significant changes are being proposed.

The Tory motion describes the planned strikes as “deeply irresponsible”, but who are the civil servants who are so “deeply irresponsible”? Who are the far-left militants who are determined to smash the state? Perhaps the Tories mean the FDA, which was formerly known as the First Division Association and is now described as the senior public servants union. Some 81 per cent of its members have voted to back strike action. Even the trade union of Sir Humphrey and Sir Peter Housden has had enough. Perhaps Sir Peter will even tear himself away from his blog for long enough to stand by the brazier with his colleagues. Who knows? That is the extent of the hash that the coalition has made of reform. Even senior civil servants who work in Her Majesty’s Government have voted to go on strike.

However, it is not the Sir Humphreys or even the Sir Peters of the public sector who will get hit hardest. Rather, it is the lowest-paid public sector workers who will see the biggest cuts in their pay because of the proposed increase in contributions. In fact, those who earn the least will end up paying much more relatively. It is the refuse collectors, dinner ladies and care home and nursery workers who will get hammered, not the mandarins. Alongside that, the decision, which was taken without consultation or negotiation, to change from the RPI to the CPI for the uprating of pensions will mean a reduction of at least 15 per cent in the real value of pensions even before any further changes are implemented.

There is inherent dishonesty in these changes. They are not about making pensions more sustainable. Rather, they are a clumsy attempt to cut the deficit by hitting public sector workers. It is not so much a reform as a ruse—and a badly played one at that. If the Tories want to cut the deficit, they could back Labour’s plan for a levy on bankers’ bonuses, but I expect that we shall hear scant support for that from Conservative members—indeed, I already hear Mr Johnstone grumbling. The Tory motion glibly talks about the strikes doing

“nothing to help Scotland’s recovery from the recession”,

but it is the UK Government’s botched economic strategy that is cutting growth and increasing unemployment.

It does not have to be that way in Scotland. The Scottish Government is not doing enough to take a different approach here, but it can do so, and it can take a different approach on pensions, too. It falls to Mr Swinney to make decisions on a number of pension schemes. Indeed, we encouraged him to take a different approach on the local government scheme, and it is right that he did so. Different choices can be made for other schemes, although we acknowledge that those choices are not easy.

We support much of what the Scottish Government has said about public sector reform, but the choices that it has made on public sector jobs also affect those who will strike on 30 November. Those people put up with a great deal of pain, including from thousands of job losses—those losses have been proportionately more in Scotland than in the rest of the UK—before reaching the difficult decision to take action. It is not action that is lightly taken, but it has the support of the Labour group in the Parliament.

Elaine Smith (Labour, Coatbridge and Chryston)

We move to the open debate. Speeches should be a tight four minutes. Unfortunately, we will have to stop the clock on members at four minutes.

Chic Brodie (Scottish National Party, South Scotland)

I welcome Mary Scanlon to her new role.

In speaking in support of the cabinet secretary’s amendment, I agree with him that this Trojan horse of a motion has nothing to do with the role of the public sector. Instead, it is a naked attempt by the Conservatives to exploit their prejudices about public sector pensions provision in the same way that Gordon Brown exploited his prejudices about the private sector in 1998. No matter how much we might accept the smooching of the first part of the Conservatives motion, with its references to the public sector’s “very valuable contribution” and its employees’ “good quality pension schemes”, we cannot escape the Con-Dem jackboot.

The motion mentions the “urgent need” for pension reform. As speakers have pointed out, the reforms are set out in the Labour peer Lord Hutton’s formidable report, which has unwittingly unlocked the safe and allowed the Tory and Lib Dem coalition in London to make its smash-and-grab raid on public sector workers’ contributions in order to reduce its deficit more quickly—

Mary Scanlon (Conservative, Highlands and Islands)

Will the member give way?

Chic Brodie (Scottish National Party, South Scotland)

No—I have only four minutes.

This smash-and-grab raid is a means of not only reducing the deficit more quickly but dismissing the sustainability of long-term pension schemes.

What did Lord Hutton say about pension reform? In a speech that he gave in March at a National Association of Pension Funds conference, he said:

“it’s a question of what reforms we need to make to ensure the sustainability of good quality public service pension schemes. And this is reform for the long-term, not in response to the fiscal pressures currently facing the country”.

He went on to say:

“public service pensions are a vital part of our national savings system”.

I agree partly with Labour that, if public service employees leave their professions or curtail their contributions—that might well be part of the Tories’ tactics—the subsequent lack of sustainable and substantial contributions to and savings by pension funds will result in reduced investment by those funds and will further damage a discredited economic strategy by a London Government—and for what?

I go back to Lord Hutton’s speech. He said:

“the fact is that public service pensions are not ‘gold-plated’ ... half of public service pensioners receive less than £6,000 a year.”

Moreover, in paragraph 4.27 of his interim report, he says:

“Net of ... contributions ... payments peak at about 1.5 per cent of GDP in 2010-11, before falling to below 1.1 per cent”

of gross domestic product

“by 2059-60.”

There is no mention of a blatant short-term cash raid to bring forward and accelerate the timescale for meeting the above objective. Of course, as Mary Scanlon said, we need to discuss and debate pension changes, but we must do so over time. The Hutton report certainly provides a basis for those discussions.

I believe that a strike will achieve little. However, it is not “deeply irresponsible”; it might be understandable and it is certainly regrettable. The people who will suffer will be public service customers and public sector employees themselves. However, the situation is not helped by the kind of crocodile tears and grandstanding that we saw from the Labour Party yesterday; the Labour Party is not and never will be the guardians of public sector employees. Labour members’ political posturing on such matters confirms that they are still in a time warp. In other words, they are 1970s Klingons.

Churchill said:

“To jaw-jaw is always better than to war-war.”

That is why we call on the unions and the non-union members in Scotland’s public sector to engage with our—their—Government on seeking a meaningful dialogue and way forward on future pension provision.

Neil Findlay (Labour, Lothian)

First of all, I thank the Tory party for lodging a very important motion that gives us the opportunity to debate something that we probably do not debate enough these days: our political ideology and philosophy.

Throughout the 19th and 20th centuries, the pioneers of the labour and trade union movement agitated and campaigned for the collective and public provision of services through friendly societies, municipalities and co-operatives. Such an approach, which was taken in direct response to the market’s failure to provide and the resulting poverty, squalor and ill health in which many were left, culminated in the creation of the national health service, the welfare state, council housing programmes and many of the services that are available now. Our services were developed out of that realisation and the desire for a fairer, better community, in which all our people, irrespective of wealth or status, would be looked after from cradle to grave. That is something that the market could not and will never deliver.

Public services are the glue that binds our society together. They act as a civilising force. They bring us into the world, cure us when we are sick, provide us with shelter and social welfare, educate us—well, they educate some of us—and look after us in old age. How we support public services—whether we support them—what resources we provide for them and the extent of our commitment to maintaining and improving them are determined by our political philosophy.

Given the current attack on public services by the Tories and the job losses caused by the SNP, we have some indication of how the UK and Scottish Administrations see our public services. We see attacks on workers’ terms and conditions, a blitz on local authority jobs, police support staff cut, nursing posts lost and wages frozen in real terms as inflation rises. We see Osborne and Cameron use the global economic crisis as a cover for their ideological assault on the public provision of services. In doing so, they peddle myth after myth.

Let us have a wee look at the current situation with pensions. It was not public sector workers or their pension funds that caused the economic crisis; that was down to the bankers.

John Swinney (Scottish National Party, Perthshire North)

Will the member take an intervention?

Neil Findlay (Labour, Lothian)

I have four minutes—not a chance.

It was down to the greed of the bankers and their accomplices.

David McLetchie (Conservative, Lothian)

It was down to the Labour Party.

Neil Findlay (Labour, Lothian)

I hear Mr McLetchie blame the Labour Party. I am sure that it was not the Labour Party that caused the crisis in Iceland, Ireland, Spain, Greece, Portugal and Italy, or maybe he has better information.

David McLetchie (Conservative, Lothian)

All socialist Governments.

Neil Findlay (Labour, Lothian)

We know who it was. It was down to the irresponsibility of the bankers and Mr McLetchie’s friends, not the teachers, cleaners and hospital staff who are legitimately defending their jobs and pensions. The rise in pension contributions is not going to pay for pensions; it is going directly to the Treasury.

Another myth is that public sector pensions are gold plated, but nothing could be further from the truth. The average is £7,800 per year and, for a woman working in local government, it is £2,800—hardly gold plated. It is also said that, as a nation, we are getting older and we cannot afford our pensions. Wrong again: by 2060, it is predicted that pensions will represent only 1.4 per cent of gross domestic product, down from 1.9 per cent today. Of course, if we tackled the tax avoiders and evaders and introduced a Robin Hood tax on speculation, there would be no need for any of this at all. As I said earlier, it is about our philosophy and what type of society we wish to see. We all know the type of society the Tories wish to see—a cheap-labour, divided and deskilled society and a society flogged off to the highest bidder.

We should be investing in our public services. My colleagues and I will be supporting our public sector workers on St Andrew’s day. There is still time for the rest of the parties to join us. They will be welcome.

Marco Biagi (Scottish National Party, Edinburgh Central)

Yesterday, when this subject was very briefly debated through the unusual means of a business motion, for a moment I felt as if I was in Westminster, not because of the issue that was being debated but because of the exchanges between Labour and Conservative members, the attitudes that were being expressed and the tone that was being taken in all the contributions. I was glad that there was the buffer zone of the voice of reason in the middle. That intemperate set of exchanges reflects what has been going on between the UK Government and the unions as well, which seems less like dialogue and more like monologue conducted through a megaphone. As with the rest of Westminster’s deficit reduction plan, it has the distinct smell of ideology rather than reason.

There are some redeeming features and the concessions have certainly been welcomed all round. It was not so long ago that left-wing publications were talking about the value of career average rather than final salary pensions for people on low incomes that tend not to progress greatly over the course of their careers. It is interesting that it was accepted that the public sector tends to have better pensions than the private. If that were an indication that the UK Government wants to address the issue by levelling up rather than by levelling down, we might not see so much of private sector workers being set against public sector workers and instead look at the underlying issues of long-term security and pay.

No wonder there is resentment from the unions—the problem is not just the impact of these changes but the whole way in which the issue has been approached and the breach of trust. The proposals include a commitment to no further reforms for 25 years but, as the Royal College of Nursing took pains to point out in the briefing that it circulated, it was only in 2008 that there was an agreement with the previous UK Government that aimed to ensure sustainability in public sector pensions, which we are told is the underlying motivation. The UK National Audit Office report in December 2010 estimated that the overall saving to the UK taxpayer from that agreement was £67 billion. Between that and the switch from the RPI to the CPI, which has already happened, the long-term cost of public sector pensions has reduced by almost 30 per cent.

In the earlier deal, staff in the public sector agreed to pick up costs for the growing pension bill, should it happen, as people lived longer. However, again according to the RCN, in the last year for which figures are available, the NHS pension scheme across the UK paid out £6.3 billion but took in £8.4 billion. That is not to give a permanent clean bill of health to the pension scheme, but it is hardly a picture of a scheme in crisis.

The figures come from 2009-10, before the current UK Government took office. As the RCN notes,

“it is difficult to get an exact figure”

for the balance now. That lack of disclosure does not build trust. Public sector workers and their unions can ask, rightly, what the UK Government is trying to hide. If the argument is on sustainability, it is not one that I heard today and, frankly, the case has not been made.

Looking ahead to next week, I think that it is a shame that there is not greater unity in the chamber. This Parliament is at its best when it is united, and there would be much better outcomes for public sector workers if the Labour Party did not approach the SNP with the same ideological objection as the Conservatives approach the unions.

Next week, thousands of workers throughout Scotland will take to the picket line because of an ideological cash grab on their livelihoods. The Scottish Government has been working a lot more constructively, and I hope will continue to do so.

Marco Biagi (Scottish National Party, Edinburgh Central)

As they strike on Scotland’s national day, public sector workers might want to reflect on how matters would have been different if the real decisions on pensions had lain with Scotland’s national Parliament.

Jamie McGrigor (Conservative, Highlands and Islands)

I am pleased to take part in today’s important debate.

As usual, we Conservatives are dealing with the difficult issues head on. We are not afraid to do that in the interests of our economy and, especially, our pensioners in the public sector. The subject is one that requires long-term strategy rather than short-term fix, and Francis Maude has a very good record of finding solutions.

I praise the role of public sector workers, especially in my region of the Highlands and Islands. Our teachers, policemen, firefighters, doctors and nurses and all the other public sector employees do superb work. We also recognise the pensioners’ contribution to society more generally in all the extracurricular, voluntary and community activities that so many undertake. They are a major element of the big society on which we all depend, and they deserve decent pensions—the increased pensions that Mary Scanlon quantified in her excellent speech—and a Government that plans ahead to deliver them.

The fact of the matter is that the UK Government is having to deal with the dreadful state of the public finances left by the last Labour Government. I commend its efforts in doing that. If we had not taken the decisive action of deficit reduction, our economy would be facing the Italian scenario, with Italian bond yields above 7 per cent again this week, despite efforts to secure a new Government, compared with UK yields of around 2 per cent. On that basis, in the future I would rather be a British pensioner than an Italian one or, for that matter, a Greek one.

People now realise the enormity of the crisis that we face in western Europe. It started as a liquidity crisis, mutated into a solvency crisis and has now become a systemic crisis. That means that the economic infrastructure is crumbling and severe measures are necessary now to avoid a far worse scenario in years to come. That is the reality.

Part of reconfiguring the public finances must involve genuine reform of public sector pensions, which the previous Labour Government patently failed to achieve. The proposed phased rise in employee contributions will average 3.2 per cent from April 2014, but the rises will be staggered according to salary with high earners paying the biggest rises.

Patrick Harvie (Green, Glasgow)

Will the member give way?

Jamie McGrigor (Conservative, Highlands and Islands)

I am sorry; I cannot do that at the moment.

Even after the changes, public sector pensions will still be miles above the average in the private sector.

The UK Government’s pension reform plans are realistic, practical and detailed, and the Government has responded to specific concerns by, for example, confirming that no worker within 10 years of his or her retirement on 1 April 2012 would see either an increase in the age at which they retire or a decrease in the pension that they receive.

It is a cop-out for the SNP Government to claim that more time is required to assess the proposals. We must act now in the interests of future pensioners. Any responsible Scottish Government should recognise the economic circumstances and support the UK Government’s plans.

I will take that intervention from Patrick Harvie.

Patrick Harvie (Green, Glasgow)

I am grateful for that.

The member mentioned the urgency of the situation and the requirement for extreme measures. Why, then, does he think that the UK Government is working so hard to prevent Europe from shutting down the tax havens?

Jamie McGrigor (Conservative, Highlands and Islands)

As usual, Patrick Harvie shoots off after another red herring. All I know is that the UK Government is trying to plan for good pensions for people in the future.

I urge the trade unions to reconsider the strike action on 30 November, which will be disruptive for families and communities. Everyone should get back round the negotiating table and engage on the issue. The Parliament should send out that message loud and clear. Nobody likes paying more for anything, but the alternative to reforming public sector pensions is to burden further the general taxpayer disproportionately for years to come, which would be a dereliction of responsibility that no Government should accept.

Roderick Campbell (Scottish National Party, North East Fife)

The motion states:

“That the Parliament recognises the very valuable contribution that the public sector makes to the economy and society”.

It goes on to say that

“there is an urgent need for reform”,

and that the Parliament believes

“that the proposed reforms will ease the burden on taxpayers”.

Let us get it right—public workers are taxpayers, too, and in very large numbers. They contribute directly to the Treasury through taxation and, on top of that, provide the staffing in schools, hospitals and the transport system, among other services, that enable the public sector to carry out its activities. Those same public sector workers and others will suffer as a result of the proposals.

We all know what the reaction has been to the proposals. I welcome the fact that Danny Alexander has accepted the need for concessions, even if no members of his party are present in the chamber. Those concessions include the proposal that employees who are within 10 years of retirement will have no changes made to their anticipated benefits. It is right not to penalise those who are least able to change their pension planning but, even among that group of people, there are widespread concerns about the UK Government’s perceived divide-and-rule strategy.

We should remember that the average local government pension is less than £5,000 a year. The average pension for female NHS workers is only £5,000 a year, but the median pension for women is much less than that. Although teachers, firemen and police do better than that, they are a relatively small percentage of the total number of people in public pension schemes. Half of all women pensioners who have worked in the NHS get a pension of less than £3,500 a year. That does not strike me as largesse or excessive. We should also remember the impact of the change in indexation for inflation from the RPI to the CPI.

David McLetchie (Conservative, Lothian)

Will the member give way?

Roderick Campbell (Scottish National Party, North East Fife)

Sorry, but I have only four minutes.

A Government that spends money on a properly funded pension scheme for its public workers is simply recognising its responsibilities. That must be our aim. There is a lot of merit in Lord Hutton’s proposals but, whatever the merits, given the record fuel prices, VAT rises and high inflation, now is not the time to penalise ordinary workers. We believe that the proposals are another example of the poorly thought out deficit reduction plan.

As the cabinet secretary said, we know the consequence of the Scottish Government failing to introduce the planned increased contributions in the NHS, fire, police and teachers schemes. We must continue the dialogue and press the UK Government for a change in policy. In the absence of that, there is no alternative. However, the fight should be not with the Scottish Government but with the UK Government.

The NHS pension scheme was reorganised in 2008 and, in the short term, it has a surplus of contributions over benefits paid out. As Marco Biagi alluded to and as the British Medical Association suggests, the contributions to the scheme currently exceed the benefits that are paid out by £2 billion a year. It is hard to avoid the conclusion that increasing contributions amounts to a deficit reduction mechanism above all else. As the BMA and others have said, there is a risk that implementing the proposals will cause large numbers of folk to walk away from their public sector pension schemes, which would leave the schemes worse off than before.

The Tories have raised concerns about people in private pension schemes. In the current financial climate, we must accept that few of those schemes are prospering and annuity rates continue to fall. However, the answer to that dilemma is not to penalise the public sector at this difficult time for ordinary folk. As the Scottish Trades Union Congress has said, nothing in the Government proposals will improve the situation of those in private schemes. I welcome the cabinet secretary’s suggestion about continued dialogue, and I urge members to support his amendment.

Hugh Henry (Labour, Renfrewshire South)

I agree with Roderick Campbell that the matter is largely the UK Government’s responsibility. I could not disagree with much of what John Swinney said, nor could I disagree with much of what is in his amendment. However, I urge him to face up to his responsibilities, listen to the trade unions and engage with them in a constructive discussion to determine what more can be done within his remit.

John Swinney (Scottish National Party, Perthshire North)

Will Hugh Henry give way?

Hugh Henry (Labour, Renfrewshire South)

No.

As John Swinney said, the debate is disappointing and the Tories have reverted to type. When they talk about the public sector, they want to focus on one narrow aspect. It is a shame that Mary Scanlon, who is a decent human being, comes to the Parliament to portray the Tory party in its usual form.

Jamie McGrigor said that the Conservatives are confronting the matter head on. Yes, they are. They are confronting the cleaners, nurses, teachers, local government workers and other public sector workers head on and making them pay dearly. They are making them work longer, pay more and receive less.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Will Hugh Henry give way?

Hugh Henry (Labour, Renfrewshire South)

No.

However, the Tory party is not confronting head on the bankers, financiers and hedge fund managers who funded it generously in the run-up to the previous election. It is not dealing with the bonuses, obscene pensions and obscene pay for those at the top. It has double standards.

Mary Scanlon was right in one respect. She said that the pension reforms are coalition policy. It is telling that there is not a single Liberal Democrat present in the chamber to participate in a debate about a policy for which they have direct responsibility. That is an abrogation of responsibility and cowardice of the worst type.

The Liberal Democrats provide a human shield for the Tories’ crude and cruel policies. The hapless Nick Clegg is, in fact, the General Haig of this political generation, leading his troops to slaughter. They are heading into oblivion and disaster while providing cover for the Conservatives. It is about time that they showed a bit of gumption and courage and took full responsibility for their actions.

We have heard a lot today about what should or should not happen on 30 November. Neil Findlay eloquently set out the ethos of the trade union movement. Trade unionists whose pay has been frozen, who face heavier workloads and who face paying more for pensions that will pay less do not take the decision to go on strike lightly. They do so on account of desperation because the Conservative-Lib Dem coalition Government will not listen to them. They do it reluctantly.

When so many workers across so many trade unions stand together to say that something must be done, we should not demean or demonise them but should listen sympathetically to what they have to say. The Parliament should send a much clearer message to those workers that it will support them in their justified action for fairness, decency and dignity in their retirement.

Paul Wheelhouse (Scottish National Party, South Scotland)

The first part of Mary Scanlon’s motion is welcome in that it stresses the value of the public sector. However, we must judge the Tories on their deeds and not their warm words.

The public sector is crucial to the social fabric of Scotland and to enabling the country to flourish. As Neil Findlay and Roderick Campbell said, public sector staff earn modest pensions. The reality is that the vast majority of public sector workers provide services in the full knowledge that they will never come anywhere close to the earnings of local authority or NHS board chief executive officers.

The myth of excesses and largesse is widespread among commentators and policy makers alike. The question that must be asked and which still requires an answer is this: why does the UK Government, in order to fund deficit reduction, continue to pursue damaging reforms to public sector pensions, which will, in effect, cut workers’ pay by an extra 3.2 per cent?

In the face of £3.3 billion of cuts that Westminster has passed down for the spending review period, the SNP Government has done all that it can to protect the pensions of people who work in the public sector. The Scottish Government has faced difficult decisions and, despite all the odds, John Swinney has managed to find the necessary balance to maintain jobs across the public sector and not to add to the burdens on Scottish families.

The Scottish Government has reluctantly had to ask public sector workers to accept another year of frozen pay. Ministers have led the way by freezing their own wages for the past four years. I wish that things were different for people across Scotland whose wages are not increasing in line with inflation but, as the Finance Committee has heard, the pay freeze is essential to maintain staff levels and to fight off the spectre of mass unemployment.

I have several questions for the Conservatives to answer in summing up. How many people do the Tories expect to walk away from public sector pensions as a result of the 3.2 per cent cut to their pay? How many will move into the private sector? How will that affect the pension schemes’ viability and sustainability? Do the Tories accept that, in each of the past five years, Scotland’s spending on pensions as a share of gross domestic product has been lower than that of the UK? In 2009-10, Scotland’s figure was 15.1 per cent, versus 15.7 per cent for the UK as a whole. That means that pension schemes in an independent Scotland would be in a much better position.

Which of the following do the Tories believe have helped to support families through the recession? Is it the VAT increase, the national insurance increase, petrol price increases or significant pension contribution increases? Where does Danny Alexander’s rather tactless letter to the Scottish Government—in which he threatened to remove £8.4 million a month from the block grant if the contribution changes were not imposed without any meaningful consultation—fit into Cameron’s respect agenda? That amounts to a threat of £550 million in cuts over the spending review period to 2015.

As I said, we are seeing drastic reforms to disability living allowance, housing benefits and public pensions. The UK Government seems to be hell-bent on a ruthless ideological agenda. The truth is that every worker who provides a service on which others rely—whether in the public or private sector—is essential to the commonweal and to the economy. No one will dispute that the private sector is a creator of wealth and jobs, but its importance as a wealth creator cannot be viewed in isolation: teachers educate the nation’s workforce, and nurses and doctors treat employees who fall ill.

Mary Scanlon’s motion refers to “the burden” of pensions “on taxpayers”, but perhaps of greater concern is the growing burden of unemployment benefit as a consequence both of disastrous economic mismanagement by successive UK Governments, and of Tory cuts to public spending at any price to society. It should be clear to all public sector workers that only if they embrace independence for Scotland can they rid themselves for good of Tory dogma and of the slash-and-burn approach to funding our services.

Richard Baker (Labour, North East Scotland)

As expected, the debate has been sharply polarised, but a number of speeches were thoughtful and persuasive. Hugh Henry described passionately and persuasively the flaws in the coalition’s policy and the Liberal Democrats’ unfortunate position as a human shield for the Conservatives in the exercise. We welcome Liam McArthur, who has joined us for the end of the debate, at least.

Neil Findlay talked about the importance of the changes to pensions and about job losses, to which I will return. I agree with a number of SNP members—Roderick Campbell, Paul Wheelhouse and Chic Brodie—that some changes threaten the sustainability of pension schemes that are otherwise performing well. That highlights the great flaws in the UK Government’s policies and proposals. However, I disagree strongly with Chic Brodie about what should happen on 30 November; we should ask trade union members what they want the Parliament to do on that date.

I take issue with the Conservative members who have defended the UK Government’s position. Let us be clear—the increased contributions will not go back into schemes to make them more sustainable, but will simply go to the Treasury. It is part of an economic plan by the UK Government that is failing to such an extent that even the International Monetary Fund has urged George Osborne to prepare a plan B.

For all the travails of the euro zone—which the UK Government now blames for the economic woes in this country—we in Scotland have one of the weakest growth rates, as does the UK.

The UK Government is making a cash grab from public sector workers, many of whom are poorly paid, which will mean another reduction in spending in our economy. It is quite clear that the Conservatives simply do not get it: their economic strategy is not working.

Of course, we agree with a number of points that were made by Scottish National Party members today. We appreciate that there are difficulties associated with delivering alternative approaches to pensions here—although it is in the gift of the Scottish Government to do that—but there are other aspects behind workers’ decision to take the action on 30 November for which the Scottish Government is responsible. Those include the extent of the job losses in the public sector in Scotland, the cuts to local government budgets, which will mean further job losses and—as we heard only recently—teachers having to purchase equipment for their classrooms because education budgets are being cut again due to the council funding settlement. The Scottish Government has made choices that are making life for public sector workers far harder. We urge the Scottish Government to make different choices that we believe will also benefit the wider Scottish economy.

Nevertheless, the content of the Scottish Government amendment is in line with our thinking on the pensions debate. We would have liked the chance to debate Patrick Harvie’s amendment, which reflects strongly our views on this important matter. Of course, we will not support the Scottish Conservative motion today. In failing to recognise the impact of the proposed changes to pensions on public sector workers, the motion—and that party—does not properly recognise the contribution that those workers make to our society and our economy. Although we hope that industrial action can yet be avoided through proper negotiations, the motion does not recognise their right and their need at this time to take proper industrial action to protect their rights to fair pensions and to protest against an economic strategy that is hurting them and families across this country. I moved the amendment in my name because we support the trade unions. We support the action on 30 November.

Aileen Campbell (Scottish National Party, Clydesdale)

I thank colleagues for a lively debate on an important issue and I extend my welcome to Mary Scanlon in her new role.

The views of Conservative party colleagues are no particular surprise because, despite warm words and efforts to disguise it, those views seem still to be founded on the notion that the public sector is part of the problem, rather than an essential ingredient in achieving economic prosperity and social wealth, as Rod Campbell expressed well in his speech.

That is not the view of the Scottish Government. As Mr Swinney set out at the start of the debate, we recognise and are taking action on the importance of public sector reform. We are not shying away from the many challenges with which we are presented and which are made even more challenging by the financial constraints that have been placed on us by the UK Government, one half of which—the Lib Dems—was not here today to participate in this important debate, the subject of which is affecting many people across Scotland. The UK Government appears to be incapable of considering the economic damage that its policies are causing, or of changing its course.

We believe that such challenges are best faced in partnership and collaboration wherever possible—a point that Chic Brodie made. The best way to get the best results is by engaging and showing respect, not by diktat. On partnership working, we agree with what Richard Baker and Hugh Henry said in their opening remarks. Another area where we find agreement with Richard Baker is in his welcoming of the Scottish Government not doing to local government what the UK Government has done to us regarding local government pensions. That is welcome—it is better late than never, given the comments that his colleague Paul Martin made yesterday.

What we need—rather than a piecemeal approach—is a measured and coherent approach to public sector pension reform. That is the best approach for achieving potential once-in-a-generation changes.

Let me be clear: the Scottish Government is committed to public sector pensions that are affordable, sustainable and fair to public sector workers and taxpayers alike. We recognise that a case has been made for longer-term reform and we will consider that once we have greater clarity on the UK Government’s proposed reforms and their impact on Scotland. However, we will do that to a timetable that suits Scotland’s interests rather than those of the UK Government.

We think that it is wrong to increase public sector workers’ contributions to their pension schemes at this time and in this way. It is a naked cash grab that is geared towards reducing the UK deficit and will do nothing to address the sustainability or fairness of pensions over the longer term. We have made abundantly clear our principled opposition to the UK Government policy of increasing employee contributions at a time when public sector workers face pay freezes, significant increases in national insurance contributions, higher VAT and rising inflation and fuel costs.

In response, the Scottish Government is taking a number of positive steps to address the challenges: the living wage, no compulsory redundancies, the council tax freeze and the abolition of prescription charges are all policies to protect families and provide security at a time of uncertainty.

Mary Scanlon (Conservative, Highlands and Islands)

Given that the Government recognises the need for the long-term reform of public sector pensions, does the minister agree that they are not sustainable?

Aileen Campbell (Scottish National Party, Clydesdale)

We believe that we have a once-in-a-generation opportunity to look at the matter as a whole instead of taking the piecemeal approach that the UK Government is taking, in which the unions are coming blind-sided into negotiation agreements.

The UK Government’s position is absolutely clear. Danny Alexander’s letter of 5 September confirmed that if the Scottish Government does not implement the increase in pension contributions, he will cut the Scottish budget by more than £100 million in 2012-13 alone, which is not a sustainable position. That would have a knock-on effect on Scottish public services, thereby making the necessary reforms much harder to achieve. Therefore, and regretfully, unless the UK Government can be made to think again we will implement the increases in pension scheme contributions for 2012-13 for the NHS, teachers, police and firefighters schemes.

Despite the announcement by the Chief Secretary to the Treasury of an improved pension reform offer on 2 November, we are concerned that the UK Government is taking a piecemeal approach to this significant issue. Not only has it introduced short-term contribution increases in a way that has contaminated discussions about longer-term reforms, but it also appears to be realising its policy proposals bit by bit. That is either a deliberate way of stifling debate, or it is evidence that the UK Government’s proposals are simply being made on the hoof. Indeed, if we look at the various twists and turns in the UK Government’s short-term proposals, it is possible to see a pattern that begins with a set of principles that are subsequently abandoned in favour of the bottom line.

In a very impressive speech, Marco Biagi noted that the approach that is being taken by the UK Government—its lack of meaningful engagement with others in terms of using the opportunity to look at pensions in the round—represents an opportunity lost.

Rod Campbell helpfully pointed out the gender concerns with regard to the pensions issue. His speech included some good points that were well made.

Paul Wheelhouse also made some excellent points and posed some pertinent questions that need to be addressed by the coalition Government. I look forward to hearing the Conservatives’ responses when they sum up the debate.

Although we can find common cause with the public sector on the short-term increases in contributions and can understand the frustrations around the proposals for longer-term changes, we believe that striking is the wrong choice. We will make a strong case as to why these clumsily handled reforms are wrong and we will send a strong message to the UK Government that it must think again.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

It is not surprising that this has been a fairly highly charged debate. However, as Neil Findlay and Jamie McGrigor said, nothing should distract us from facing up to a hugely challenging issue. If politics is about anything, it is about the ability to make tough decisions, even if at times they are unpopular. We, on this side of the chamber, are certainly not going to apologise for measuring up to that challenge.

We should start from the understanding that there is clear cross-party agreement that the pensions status quo is not sustainable, especially in Scotland, where the public sector is a bit bigger than it is south of the border. There is a fundamental need for reform. Originally, it seemed that politicians on all sides had accepted the conclusion in Lord Hutton’s interim report of October 2010 that there is both a short-term need to address the pensions issue, resulting from the imbalance between the employer and employee contributions and the problem of an ageing population, and a long-term need to redesign the pension schemes completely so that they are less of a burden on the taxpayer and less open to the wide variations received by employees. There is both a short-term and a long-term issue.

None of us doubts the emotional context of the debate, nor the fear of some employees that the increased contributions that they will be asked to make will create difficulties for them in their personal financial decision making. However, I am afraid that I cannot accept Richard Baker’s assertion that the lowest-paid people will come off worst. The Westminster Government has given a guarantee that people who earn under £15,000 will not have any increase at all.

Nobody doubts that this is a difficult issue. However, to do nothing is not an option. That is why it is important to understand the facts as well as to appreciate the strong feelings.

Aileen Campbell (Scottish National Party, Clydesdale)

Liz Smith says that the lowest-paid people are not getting a bad deal. Will she concede that she is comparing apples with pears and that the comparisons should be made with people who will be working up to the age of 68, as opposed to people who are retiring now at the age of 60?

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Forgive me, but I think that there are two issues there. First, the assertion was made that we are not looking after the lowest-paid people. That is, frankly, not true. The minister is referring to a measure for change within the whole pensions structure.

The facts are important. The cash-terms expenditure on paying out pensions to public sector pensioners over the past 10 years has increased to £32 billion—no one needs to be reminded that that is roughly the same amount as the Scottish budget. Secondly, as Mary Scanlon rightly said, the taxpayer contributes three times more to an average civil service pension than the average private sector employee pays in to a pension. Thirdly, that average public sector pension remains at £5,600 a year, compared to only £3,900 in the private sector.

Despite some of the protestations in this chamber, we are clear that moving towards a career-average scheme would be fairer, as everyone would receive broadly the same amount for every pound that they contribute and it would guard against the risks that come from individuals jumping on to higher salaries in the later stages of their career.

We should not forget that that is also a logical step that is in tune with some of the greater flexibility that is likely to be a feature of future employment trends, similar to those that were described by Graham Donaldson when discussing the future of the teaching profession.

John Swinney (Scottish National Party, Perthshire North)

Could Liz Smith address an issue that troubles members on the SNP benches, which is that the short-term decision about increasing contributions has contaminated the ability to secure Lord Hutton’s well-argued case in relation to pensions reform? Does she not accept that the coalition has made a fundamental error in taking that approach?

Elizabeth Smith (Conservative, Mid Scotland and Fife)

All the Westminster parties are clear that there is a short-term need to deal with the funding of pensions, which we face because of the serious economic difficulties that we were left with by the Labour Party. However, there is obviously also a longer-term provision to change the structure. I make no apologies for raising both of those parts of the approach because, as Mary Scanlon pointed out earlier, we must ensure that the pensions system is not only sustainable in the long term but can deal with some of the difficult issues that we face just now.

I will finish on what is perhaps the most controversial issue of all: the impending strike action, on which there have been heated exchanges. No one doubts the difficulty that we face, particularly given the backdrop of tough economic times. No one doubts the strength of feeling on all sides. We respect that. That is why the Westminster Government has been at pains to have constructive engagement with the unions and why it saw the need to make a substantially improved offer. The negotiations are on-going and, as other parties have said, at Westminster and in this chamber, while they are on-going it is not appropriate for strike action to be taken.

It is incumbent on all of us to understand that, although feelings are running high, the problem cannot just be swept under the carpet. We must deal with it. We must confront it. We must get some kind of sustainability for the future.

I support the motion in Mary Scanlon’s name.

Patrick Harvie (Green, Glasgow)

On a point of order, Presiding Officer. I understand that as a member of a small party I will not always be able to move amendments or to participate in debates. I respect the decision that was made, even though Liberal Democrat members chose not to take part at all.

However, given that I have been unable to participate in this debate, I must ask you about the discussion that will take place in the Parliamentary Bureau next week. I will have no representative during that discussion, and you are the only person who can represent the interests of all members. I ask for your assurance that you will represent the interests of members who wish to give the unions the support that they have asked for on 30 November and will make it clear to the Parliamentary Bureau that scheduling a debate that is specifically designed to exclude those members from debating this issue is not acceptable.

Tricia Marwick (None, Mid Fife and Glenrothes)

I thank the member for his point of order. I point out that the members who were called in the debate had all requested to speak in the debate before Mr Harvie did. There was simply not enough time, in what was a very short debate, to call Mr Harvie.

On the Parliamentary Bureau, it is open to the member to come and discuss that issue with me at any time. If he wishes to ensure that his views are represented to the bureau, I suggest that he write a letter to the members of the bureau so that they are made well aware of his concerns.

Road Equivalent Tariff (Orkney)

Liam McArthur (Liberal Democrat, Orkney Islands)

1. To ask the Scottish Executive what assessment it has made of the impact of introducing a road equivalent tariff on ferry fares for routes to, from and within Orkney. (S4O-00358)

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The draft road equivalent tariff evaluation report, which was published in March this year, shows illustrative RET fares for all Scottish Government-subsidised routes, including Orkney routes, and the likely impact on passenger numbers. It also shows that, on balance, most local authority-run ferry services have fare levels that appear to be set below or at around the level of an RET fare.

Liam McArthur (Liberal Democrat, Orkney Islands)

The minister will be aware of the anger and, indeed, disbelief among my constituents at the Government’s decision to extend, seemingly indefinitely, the so-called pilot road equivalent tariff scheme on ferry routes that serve the Western Isles. The decision to extend the cheap ferry fares scheme to other islands on the west coast is also one that people in Orkney and Shetland are struggling to understand.

Will the minister explain to my constituents the basis for those decisions? Will he clarify why, to date, there has been no opportunity for robust public scrutiny of the scheme or debate about how the funding that is available might best be used to provide benefits to all the communities that are dependent on lifeline ferry services? Given previous ministerial promises that this record-breaking pilot was the first step in rolling out RET to other routes, including those across the Pentland Firth, will he update Parliament on what progress has been made in meeting that commitment?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The decisions were based on our manifesto commitment to have a pilot in our first term in government and to roll it out to other areas in the Clyde and Hebrides in our second. There was no manifesto commitment to roll it out in the northern isles.

However, we provide £38 million of subsidy for ferry services to the northern isles. The implementation of RET would result in higher fares for many northern isles trips. Islanders currently receive a discount of around 30 per cent; the same discount is available to families and friends on those crossings.

If Liam McArthur wants more to be done in this area, it would be useful for him to address fuel prices and the cuts by the Westminster Government, which are reasons why it is becoming more and more expensive to subsidise the northern isles services. Despite that expense, we will continue to support them in the ways that I have described.

Jamie McGrigor (Conservative, Highlands and Islands)

Is the minister aware of the comments of the leader of Orkney Islands Council, Stephen Hagan, who fears that Orkney is losing out on tourism because of the lack of RET there? The people on Mull, Islay, Jura and Colonsay also feel that they are losing out.

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I am aware of the council leader’s comments. If the member refers to the study that I mentioned, he will see the extent to which the pilot has resulted in increased traffic to, and increased tourist numbers on, the islands that are benefiting from the scheme. There is very little evidence of any displacement from other islands.

In relation to the other islands that the member mentioned, there is the commitment that I referred to earlier, on which we will make an announcement in due course.

Gritting (North Lanarkshire Council)

Clare Adamson (Scottish National Party, Central Scotland)

2. To ask the Scottish Government what discussions it has had with North Lanarkshire Council regarding its winter gritting programme. (S4O-00359)

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The Scottish Government is responsible for trunk roads and motorways. Individual local authorities are responsible for setting policies that are relevant to local conditions on their own road network. Transport Scotland and its operating companies have been in contact with local authorities throughout the summer and are co-ordinating the management of the Scottish salt cell to monitor salt supplies.

Clare Adamson (Scottish National Party, Central Scotland)

The minister will be aware that North Lanarkshire Council issued a press release in which it threatened to withdraw gritting services in areas where crews had been subjected to attacks and highlighted the Pather area of Wishaw, which received national coverage on television and in newspapers.

Would it surprise the minister to know that, when it was approached, North Lanarkshire Council was unable to confirm how many incidents had taken place and that Strathclyde Police has confirmed that it has had no discussions with the council about how to tackle what was alleged to have been a serious problem? Furthermore, Strathclyde Police stated that it was

“rather surprising to hear North Lanarkshire Council’s announcement”.

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

Clearly, such behaviour is abhorrent. The acts are also criminal, and I am sure that the council and the police will take action as appropriate. As the member suggests, it is somewhat surprising that—from what has been said—discussion appears not to have taken place.

I call on everyone to acknowledge the crucial role that gritters, and others who clear the roads, play during severe weather. I encourage North Lanarkshire Council and Strathclyde Police to work together to eliminate any and all criminal activities and to respect and support public sector workers in carrying out their essential tasks. Of course, all local authorities have a statutory duty to keep the roads clear, as far as is practicable.

Combined Heat and Power

Paul Wheelhouse (Scottish National Party, South Scotland)

3. To ask the Scottish Government what support it provides for the development of local combined heat and power biomass energy plants. (S4O-00360)

Fergus Ewing (Scottish National Party, Inverness and Nairn)

The Scottish Government has a policy to support the deployment of biomass in heat-only or combined heat and power plants, particularly off-gas grid, to a scale that maximises heat use and local supply.

Paul Wheelhouse (Scottish National Party, South Scotland)

Developers of a biomass CHP at Charlesfield, St Boswells, have concerns about the availability of investor capital to fund the infrastructure to establish a district heating network. Given the instability of the United Kingdom policy on solar energy, investors in biomass are seeking reassurance and long-term support for the sector. Will the minister give such reassurance from a Scottish Government perspective? Will he be willing to meet me to discuss funding the associated infrastructure costs?

Fergus Ewing (Scottish National Party, Inverness and Nairn)

I would be happy to meet the member to discuss those matters. District heating projects are extremely important to the Scottish Government, which is why we have invested £1.9 million towards them. We acknowledge that they play a very important part—as, indeed, does biomass—in heat-only or CHP schemes off grid. In 2010, more than 90 per cent of renewable heat in Scotland came from biomass. I am therefore very happy to work with the member on all of these matters.

Malcolm Chisholm (Labour, Edinburgh Northern and Leith)

I welcome the Scottish Government’s proposals to remove the subsidy from large-scale, electricity-only biomass. However, will the minister clarify the Scottish Government’s proposals for large-scale electricity biomass where a small, but not insubstantial, amount of the heat is also used?

Fergus Ewing (Scottish National Party, Inverness and Nairn)

As Malcolm Chisholm knows, our policy position on biomass is clear, and is covered in the draft electricity generation policy statement, in the national planning framework 2 and in planning guidance. We believe that large-scale biomass plants that produce only electricity are not the best use of biomass, which is a valuable product.

We acknowledge that biomass has a place, especially in local community projects that use a local supply. Such projects often provide additional income to tree-growers when no other use of the material would be possible. We support local use, but we do not believe that large-scale use for electricity only is the most effective use of biomass. As Malcolm Chisholm knows, that has been our policy for a considerable time.

Tenancy Deposit Protection Scheme

Marco Biagi (Scottish National Party, Edinburgh Central)

4. To ask the Scottish Government what progress is being made in bringing forward an approved tenancy deposit protection scheme and when the details of such a scheme will be announced. (S4O-00361)

Alex Neil (Scottish National Party, Airdrie and Shotts)

The Scottish Government is evaluating three proposals for the operation of national tenancy deposit schemes. Prior to final approval, public consultation will be conducted on the terms of all schemes meeting the Tenancy Deposit Schemes (Scotland) Regulations 2011. Once a scheme is approved by ministers, full details of that scheme and its date of implementation will be announced.

Marco Biagi (Scottish National Party, Edinburgh Central)

The tenancy deposit protection scheme is welcome; it will offer security to private renters in my constituency and in many other areas. The cabinet secretary will know that, once the scheme is introduced, few challenges will arise in promoting it to recipients of housing benefit and to students. However, can he reassure me that the scheme will be promoted to harder-to-reach groups, such as groups of young renters sharing flats in city centres? Such people tend not to access services, and it can be hard to reach them with information.

Alex Neil (Scottish National Party, Airdrie and Shotts)

I can assure Mr Biagi that we will do everything possible to promote the scheme, once it is introduced, to all the target groups. The purpose of introducing it is to ensure that the most vulnerable people are fully protected.

Public-private Partnerships (Scottish Trades Union Congress Protocol)

Malcolm Chisholm (Labour, Edinburgh Northern and Leith)

5. To ask the Scottish Government whether the protocol agreed by the Scottish Executive and the STUC in December 2002 concerning employment issues in public-private partnerships is still in force. (S4O-00362)

John Swinney (Scottish National Party, Perthshire North)

“Public Private Partnerships in Scotland—Protocol and Guidance Concerning Employment Issues”, issued in November 2002, remains applicable.

Malcolm Chisholm (Labour, Edinburgh Northern and Leith)

I welcome that reply. The cabinet secretary will know that section 9.5 of the protocol says:

“The service provider will be required to offer new recruits to a PPP workforce access to the same pension arrangements as transferred employees.”

The cabinet secretary may not be aware that the City of Edinburgh Council’s proposed privatisation of a large number of council services does not conform with section 9.5. I hope that the proposal will, in any case, be rejected but, in the meantime, will he write to the council to remind it that the protocol—and that section in particular—is still in force?

John Swinney (Scottish National Party, Perthshire North)

I am happy to confirm that the protocol is in place.

The local authority will have to have regard to the section 52 guidance, which is essentially statutory guidance to local authorities on contracting. The guidance is not binding on the local authority but the local authority must have regard to the contents of that provision.

At this stage I am unable to confirm to Malcolm Chisholm whether section 52 conveys any obligation in respect of the issue of pension entitlement that he has raised. I am happy to write to the member with clarity on that point. If there is further detail that he wishes to explore with the Government, I would be happy to meet him to discuss it.

Tourism (Olympic Games)

George Adam (Scottish National Party, Paisley)

6. To ask the Scottish Government how it plans to attract tourists to Scotland during the 2012 Olympic games. (S4O-00363)

Fergus Ewing (Scottish National Party, Inverness and Nairn)

The Government is working closely with VisitScotland, the enterprise companies, VisitBritain and the London Organising Committee of the Olympic and Paralympic Games to ensure that we maximise the benefits that Scotland can realise from the significant tourism opportunities presented by the games.

In addition to that and its highly successful core campaigns, VisitScotland will undertake targeted promotional activity around the games to highlight Scotland’s world-class tourism credentials. In particular, through our year of creative Scotland, we will showcase our culture and creativity.

George Adam (Scottish National Party, Paisley)

Does the minister agree that there is a real opportunity to attract to Scotland residents of the south of England who wish to get away from the hustle and bustle of the games?

Fergus Ewing (Scottish National Party, Inverness and Nairn)

You can never have too many Londoners visiting Scotland. We are happy to welcome them if they wish to take refuge from the hustle and bustle of the great metropolis and come and enjoy the manifold attractions that Scottish hospitality has to offer.

John Scott (Conservative, Ayr)

The minister will be aware that one of the threats to Scottish tourism before and during the Olympic games is the increase in air passenger duty. What discussions has the minister had with the United Kingdom Treasury about keeping to a minimum the tax, which so disproportionably affects regional Scottish airports such as Prestwick?

Fergus Ewing (Scottish National Party, Inverness and Nairn)

John Scott makes a very good point indeed. We are extremely concerned about the impact of APD. I know that many airlines have highlighted the issue; indeed I received a message from easyJet this morning about it.

I am delighted to make common cause with Scottish Conservatives and work shoulder to shoulder with them to persuade the Chancellor of the Exchequer of the case for taking effective action, as many other countries are doing, to provide a better tax environment to attract tourists and visitors. I am delighted that the Scottish Conservatives recognise the need for change in the fiscal approach of the London Treasury.

British Waterways Scotland (Waterfront Development and Public Safety)

Bill Kidd (Scottish National Party, Glasgow Anniesland)

7. To ask the Scottish Government what its strategic management plans are for British Waterways Scotland regarding waterfront development and public safety. (S4O-00364)

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

British Waterways Scotland works in partnership with local authorities and others to maximise the wider benefits of our canals and to stimulate the regeneration of the canal corridors. Speirs Wharf in Glasgow, Edinburgh Quay and the Falkirk wheel are all examples of such partnerships delivering safe waterside environments providing quality places for people to live, work and play.

Bill Kidd (Scottish National Party, Glasgow Anniesland)

What plans are there to encourage further developments along canals such as the Forth and Clyde canal, which runs through my constituency of Glasgow Anniesland, and what community involvement could be encouraged from those who live alongside the canals?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The reopening of the Forth and Clyde canal 10 years ago had, as the member noted, a significant impact on areas in Glasgow close to the canal. The Glasgow canal regeneration partnership has had great success in revitalising the canal and engaging local waterside communities. British Waterways Scotland’s key projects include new social and affordable housing at Maryhill, the regeneration of Maryhill locks and a new cultural quarter by the Forth and Clyde at Speirs Wharf. The master plans for Speirs locks and Maryhill locks were both recognised as being exemplary by the Scottish sustainable communities initiative, reflecting not only the quality of the design and master planning but the successful and well-considered community engagement underpinning them. There are many other developments to which I could refer, but I will write to the member with details of them.

Unemployment (Older People)

Sandra White (Scottish National Party, Glasgow Kelvin)

8. To ask the Scottish Government what action it is taking to address unemployment in older people. (S4O-00365)

John Swinney (Scottish National Party, Perthshire North)

Tackling unemployment for individuals of all ages is a priority for the Scottish Government. Within the scope of the powers that we have, we are implementing an economic strategy for growth, targeting resources where they are most needed and working to better align all employability and skills services across Scotland.

Sandra White (Scottish National Party, Glasgow Kelvin)

The cabinet secretary may be aware of the recent announcement by Glasgow City Council, offering cash incentives to companies to employ unemployed people over the age of 50, which is a very good idea. Will he look into that scheme with a view to extending it throughout Scotland?

John Swinney (Scottish National Party, Perthshire North)

As I said to Sandra White in my initial reply, the Government seeks to ensure that its employability initiatives are focused on all areas of the labour market. I will certainly consider the Glasgow City Council proposal. The fact that the council can offer such an incentive is an indication of the strength of the local authority funding settlement that the Scottish Government provided, which I think will be welcome throughout the city of Glasgow.

Motorway Gantry Signage

Elizabeth Smith (Conservative, Mid Scotland and Fife)

9. To ask the Scottish Executive what discussions it has had with Transport Scotland regarding motorway gantry signage. (S4O-00366)

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

Transport Scotland is responsible for motorway gantry signage. Through its Traffic Scotland service, it uses variable message signs to provide advance warning to drivers of emergencies, incidents and road closures. It endeavours to communicate what it knows when it knows it by as many means as possible. When the signs are not required for those purposes, they are used to promote road safety, network operations and related campaigns. The background messages have been developed in consultation with a number of stakeholders, in particular the police authorities.

Elizabeth Smith (Conservative, Mid Scotland and Fife)

Will the minister give assurances that the gantry signs will hold time-sensitive information about weather forecasting as we approach the winter?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

Yes, and over and above that, on routes such as Edinburgh to Glasgow, there will be real-time information about how long journeys are expected to take, which is a significant enhancement of the service that is provided.

VAT (House Extensions and Improvements)

Kevin Stewart (Scottish National Party, Aberdeen Central)

10. To ask the Scottish Government what discussions it has had with the United Kingdom Government regarding reducing VAT on house extensions and other improvements. (S4O-00367)

Alex Neil (Scottish National Party, Airdrie and Shotts)

Scottish ministers have written to the UK Government on a number of occasions to make the case for a reduction in the rate of VAT for work on houses. The Cabinet Secretary for Finance, Employment and Sustainable Growth wrote to the Chancellor of the Exchequer on 16 November on that issue.

Tricia Marwick (None, Mid Fife and Glenrothes)

We will have a brief supplementary from Mr Stewart, and a brief answer, please.

Kevin Stewart (Scottish National Party, Aberdeen Central)

Does the cabinet secretary agree that reducing VAT on alterations, repairs, maintenance and extensions for dwelling-houses would cut down on the amount of black market work that currently goes on, maintain health and safety standards and boost legitimate trade, and could lead to a greater tax take for the Exchequer?

Alex Neil (Scottish National Party, Airdrie and Shotts)

I entirely agree with the member. Such a reduction would also create more jobs and improve housing in Scotland. I point out that the chancellor has the power to do most of what has been suggested and could do so on 29 November, because on 10 March 2009 the economic and financial affairs council—ECOFIN—gave him that power in relation to labour charges for repairs and renovations, which is by far the largest element of the cost of repairs and renovations for housing. We call on the chancellor to act now.

Engagements

Iain Gray (Labour, East Lothian)

1. To ask the First Minister what engagements he has planned for the rest of the day. (S4F-00270)

Alex Salmond (Scottish National Party, Aberdeenshire East)

I shall have meetings to take forward the Government’s programme for Scotland.

Iain Gray (Labour, East Lothian)

Presiding Officer, 215,000 Scots are unemployed and 100,000 young people are without work. How many Scots have to find themselves on the dole before the First Minister admits that his plan MacB is not working?

Alex Salmond (Scottish National Party, Aberdeenshire East)

The unemployment situation in Scotland is extremely serious. The Government is working flat out to generate the maximum number of jobs, but even Iain Gray would have to accept that the position on aggregate demand in the United Kingdom is set by the UK Government. Within that context, the Scottish Government is being successful. We have lower unemployment, higher employment and lower economic inactivity than the rest of the United Kingdom. That is an important aspect that indicates that some of the efforts we are making are bearing fruit in bringing people back into employment and generating employment for our young people.

Iain Gray (Labour, East Lothian)

Is that really the limit of the Scottish National Party’s ambition? Is that what they call success, to be not quite as terrible as the Tories? Even given that very low bar, youth unemployment in Scotland is higher than in the UK as a whole. George Osborne is cutting too fast and too deep, but is it not the truth that Alex Salmond is cutting capital budgets and public sector jobs even faster and even deeper than the Tories?

Alex Salmond (Scottish National Party, Aberdeenshire East)

I do not know where to start with Iain Gray, but let us examine his record. In the period when Scottish unemployment was higher than that of the rest of the UK—it was a brief period in comparison with the Labour Party’s record in office—Iain Gray mentioned it seven times, at virtually every First Minister’s question time. Indeed, in his valedictory address as leader of the Opposition, when he thought that he was going into government, he said:

“Here is the figure that matters. Alex Salmond inherited a Scotland with lower unemployment than the rest of the country, and he leaves a Scotland with higher unemployment than the rest of the country.”—[Official Report, 17 March 2011; c 34602-3]

So, on 17 March that was the figure that mattered. Now, at a time when, thanks to the efforts of the Scottish Government to mitigate the impact of Westminster cutbacks, employment in Scotland is higher than that in the rest of the United Kingdom and unemployment is lower, all of a sudden that does not matter any more. Of course it matters. It is one of the figures that matter. As for ambition, my ambition and that of the Scottish National Party is to have this country free to harness its resources and to bring wealth and employment to all our people.

Iain Gray (Labour, East Lothian)

If any of the 215,000 unemployed people are listening, that will not sound like a plan MacB to them. It will sound like nothing but a lot of MacMince, which is what they have come to expect from their First Minister.

Between last year and this, George Osborne cut capital budgets by 11 per cent; Alex Salmond cut them by 21 per cent. George Osborne got rid of 3.8 per cent of public sector jobs; Alex Salmond got rid of 4.1 per cent. George Osborne cut colleges by 3 or 4 per cent, but Alex Salmond cut ours by 10 per cent. If Alex Salmond cannot give those 100,000 young people a job, he can at least give them the truth. Will he admit that he is cutting faster and deeper than the Tories and that that is why unemployment is rising in Scotland?

Alex Salmond (Scottish National Party, Aberdeenshire East)

Employment in Scotland is higher than it was at this time last year, unemployment is lower than it was at this time last year, and unemployment in the rest of the United Kingdom is at its highest for 20 years.

Let us dispense with the nonsense about capital spending that I have heard Labour Party spokespeople repeat many times over the past few days. Iain Gray should really beware of taking any lines from Richard Baker. The reason that capital investment is being cut in Scotland is that it is allocated using the Barnett formula. It is being cut harder in Scotland and Wales and in the devolved authorities because of the Barnett formula. In other words, the non-devolved departments are getting slightly less capital spending cutbacks than the devolved departments, but before we just blame the Tory-Liberal coalition Government, we should realise that it is proceeding with exactly the capital plans that were set out by the Labour chancellor, Alistair Darling—the man who was going to cut deeper and tougher than Margaret Thatcher. He said in his memoirs that his plans lacked credibility because they were not tough enough.

What are we doing about the Westminster cutback in capital spending? We are shifting £750 million from resource to capital spending, and we have a non-profit-distribution programme that will generate £2.5 billion in capital spending. That gives us a capital spending total that is unique in these islands, rising every year to 2014-15. That is real action to help real people. The Labour Party chooses to engage in collective amnesia about where the capital cuts came from: they came from Westminster Labour rule.

Iain Gray (Labour, East Lothian)

I see that the First Minister has won a couple of awards in the past week. It would be churlish of me not to congratulate him, but with unemployment in Scotland standing at 215,000 and at 100,000 for young people, if there was a complacent politician of the year award, he would run away with it.

The First Minister likes to talk about a mythical independence generation. This generation is on its own, okay—100,000 of them. He will give them a wristband that says, “It’s starting”, but he will not give them a start, a job, an opportunity or a future.

I see that Alex Salmond would like to be called Prime Minister in a separate Scotland. Does not that tell us everything that we need to know about his Government’s priorities? When will he stop thinking about his next job and give our young people a first job so that they can make a start in life?

Alex Salmond (Scottish National Party, Aberdeenshire East)

Let us look at the track record of Scottish National Party ministers, who are working hard to generate employment in Scotland, and the great international companies that have decided in the past few months to locate their activities here: Mitsubishi, Doosan, State Street, BNY Mellon, Gamesa, Dell, INEOS/PetroChina, Aker, FMC Technologies, Vion Hall’s, Avaloq, Amazon and TAQA. Let us consider all those companies and the efforts of SNP ministers and our officials in gathering that investment to Scotland. What has the Labour Party been doing? It is in cahoots with the Tories, trying to talk Scotland down at every opportunity.

The Labour Party says that responsibility lies with only the Scottish Government, despite the fact that it knows full well where the cutbacks are coming from. Its five-point plan for growth gives the game away, of course. I have already dealt with capital investment, but the other four points that Labour’s plan for growth entails are all requests of the Westminster Government. Labour in opposition is lobbying the Westminster Government because it knows that that is where the economic power lies at present over the Scottish economy and the Scottish people. That is why the SNP’s ambition is to harness Scotland’s resources and put them to work for the Scottish people, and that is why Iain Gray will never be called First Minister.

Iain Gray (Labour, East Lothian)

Let the First Minister not dare call it talking Scotland down when I speak up for 100,000 unemployed young Scots. Somebody must speak for them, because neither he nor his supine back benches are doing so.

Let us look at his ministers’ record. Over the past two years, the number of people unemployed is worse; the unemployment rate is worse; the employment rate is worse; and the economic activity rate is worse. That is their record. Not only should ministers be ashamed of it, but the First Minister should tell us now what he is going to do about it.

Alex Salmond (Scottish National Party, Aberdeenshire East)

I note that Iain Gray has changed to talking about two years. Otherwise, he would have to acknowledge that in Scotland—uniquely, in the United Kingdom—unemployment has gone down and employment has gone up over the past year.

In the UK, Labour is in power in one place: Wales. I am not going to criticise the Government of Wales, because it is under the same strictures of Westminster cutbacks that we are. If Labour has the answer to economic problems and unemployment, why are unemployment and youth unemployment in Wales higher than they are in Scotland? If Labour has the magic solutions, why is it not implementing them in the one place in these islands where it is still in government? The failure to come forward with answers when in government in the UK, or to realise that it was in cahoots with the Tories in trying to discourage investment in Scotland, is why Labour failed in the election and why it is on the route to extinction in this country.

Secretary of State for Scotland (Meetings)

Ruth Davidson (Conservative, Glasgow)

2. To ask the First Minister when he will next meet the Secretary of State for Scotland. (S4F-00277)

Alex Salmond (Scottish National Party, Aberdeenshire East)

I have no plans to meet the secretary of state in the near future.

Ruth Davidson (Conservative, Glasgow)

Forty-eight hours ago, Transport Scotland, a finger’s-length organisation of the Scottish National Party Government, published its plans for wrecking our railways by having slower trains, fewer stations, more crowding and longer journeys for passengers up and down the country. However, this morning, we read of a screeching U-turn and the SNP Government’s attempts to run a mile from its own consultation. I see that the first page of the document carries lovely pictures of Alex Neil MSP and Keith Brown MSP. How can anyone have the confidence to invest long-term in Scotland’s future when SNP ministers are talking down our railways?

Alex Salmond (Scottish National Party, Aberdeenshire East)

There is a clue to the document’s status in the reference to “consultation” on the front page. I really am surprised by Ruth Davidson. I point out, for example, that page 6 of the document, which sets out options for sleeper services—which is what, I should add, the document is meant to be doing—suggests that they could be reduced or have increased “financial support”. Understandably, some of our press interpreted that as going only one way. This is a document of options from Transport Scotland; SNP ministers’ view on the railways will be published when the consultation ends at the beginning of March.

However, I say to Ruth Davidson that although the consultation is a very important part of the process and although we will listen to the responses to it, I do not think that we need a crystal ball to see the direction of travel in Scotland’s railways, the past four and a half years of which are laid out in the document. This is a railway with new stations, expanding passenger numbers and dramatic increases in the amount of track and availability of rail services, and that is the course that SNP ministers will continue to set.

Ruth Davidson (Conservative, Glasgow)

I understand very well that this is a Government consultation. Indeed, that is my very point: it is a Government consultation from whose words and terms the Government is now running a mile, saying, “A wee quango did it and ran away.”

We all want Scotland’s railways to be fit for the 21st century and to attract long-term investment. However, as the Neil-Brown document itself admits, there is a cloud hanging over such investment. On page 21, the document suggests that we might get only a short-term deal for our railways because investors could be worried about the unanswered constitutional question. So, there we have it. SNP ministers have come clean and the First Minister should come clean right now. Failing to answer the constitutional question is turning off long-term investment in Scotland. The SNP’s dither and delay on the constitutional question could sabotage long-term investment in Scotland, and this document says so.

Alex Salmond (Scottish National Party, Aberdeenshire East)

What people will look at is the contrast, not just in the past few years but over the next few years, between rail services in Scotland, which have been expanding—and where passenger fares, for example, have been set at retail prices index plus 1 per cent—and the situation in England. I do not know whether Ruth Davidson is aware that the Conservative and Liberal Administration’s position on fares in England is RPI plus 3 per cent. We have an expanding revenue base for the railways rising to £794.7 million in 2013-14.

I am delighted that Ruth Davidson has taken the opportunity to rather quietly repeat some of the nonsense that has been coming from her colleagues in Westminster and the argument about investors being deterred from Scotland. I have read out the substantial list of substantial international companies that are investing in Scotland. I have also noted the lobbying from Conservatives in the north-east of England—the most senior Conservatives, who are lobbying the chancellor because they are jealous of Scotland’s success in job creation.

I hope that Ruth Davidson, at some point in her new leadership, will distance herself from her own party colleagues—lobbying her own chancellor—who are trying to remove jobs from Scotland and take them elsewhere. I hope that the Conservative Party in this Parliament will stick up for Scotland and disassociate itself from the views that are being expressed by the Conservative Party in the north-east of England.

Christine Grahame (Scottish National Party, Midlothian South, Tweeddale and Lauderdale)

I refer the First Minister to Lord Carloway’s report, which was published today. In paragraph 32 of the executive summary, Lord Carloway recommends that the High Court should not be able to refuse a referral from the Scottish Criminal Cases Review Commission, as it can currently do under the Criminal Procedure (Legal Assistance, Detention and Appeals) (Scotland) Act 2010. He recommends that that provision should be repealed. Is the First Minister minded to accept that recommendation?

Alex Salmond (Scottish National Party, Aberdeenshire East)

We have to consider Lord Carloway’s report in some detail before giving a ministerial response. It is a deeply detailed document with more than 400 pages of detailed assessment and potentially far-reaching implications across the range of our criminal law. Those who have had the opportunity to look at Lord Carloway’s review will recognise that, in a range of areas, he is pointing out that decisions made piecemeal by a number of courts, including the Cadder judgment, have serious implications for Scottish criminal law. Therefore his report was designed—and, I think, fits the task—to set out options for this Parliament to consider. The correct way to proceed is to consider Lord Carloway’s review in detail and then, if necessary—and I think that it will be appropriate—bring to this Parliament the requisite changes that are required to rebalance the judicial process in Scotland.

Willie Coffey (Scottish National Party, Kilmarnock and Irvine Valley)

The First Minister is aware of the circumstances surrounding the tragic death of my constituent Alison Hume in Galston in 2008 and the fatal accident inquiry report that was published yesterday by Sheriff Leslie. In light of Sheriff Leslie’s comments about significant failures in handling the incident by senior officers within Strathclyde Fire and Rescue, will the First Minister assure me that there will be a comprehensive review of the rescue capabilities of that service that puts saving lives first and foremost?

Alex Salmond (Scottish National Party, Aberdeenshire East)

This whole Parliament would want, once again, to join in issuing its condolences to Alison Hume’s family and friends over the circumstances of her death. Sheriff Leslie’s determination is extremely detailed and carries many important lessons and issues. We give our sheriffs in Scotland very substantial powers in fatal accident inquiries—I think that that is the right thing to do. The institution of sheriffs is well recognised and well respected, and therefore the determinations that sheriffs make have to be accepted by all parties. I do not think that they should be second-guessed, and people will be looking for an indication of the action that must now follow.

Sheriff Leslie’s fatal accident inquiry raised important issues surrounding the operational procedures in Strathclyde Fire and Rescue. Under section 44 of the Fire (Scotland) Act 2005, ministers may request that Her Majesty’s chief inspector of fire and rescue authorities conduct an inquiry into the manner in which an authority is carrying out its functions.

Given the serious nature of the determination by Sheriff Leslie, I have asked the Minister for Community Safety and Legal Affairs to make such a request of the chief inspector. He will carry out a comprehensive inquiry, and the report will be laid before the Parliament. It will then be for ministers to decide what direction, if any, can be made under the powers provided by the 2005 act. That is the most serious course of action that ministers can take under the legislation, and I believe that the circumstances of the case reflect and require it.

Let me add that, although Sheriff Leslie’s determination laid bare a number of key organisational and procedural points that are of great seriousness and had tragic consequences in this case, there is nothing in the determination that questions the fact that every single one of the firefighters and fire officers on site had the aim and intention of rescuing Alison Hume. There is also nothing in the determination to deflect from the general admiration and support that we give the fire services and our other blue-light services, which do such a fantastic job on Scotland’s behalf.

Teachers (Industrial Action)

Kenneth Macintosh (Labour, Eastwood)

3. To ask the First Minister what the Scottish Government’s position is on the Educational Institute of Scotland’s call for a ballot on industrial action about proposed changes to the McCrone agreement. (S4F-00279)

Alex Salmond (Scottish National Party, Aberdeenshire East)

The Scottish negotiating committee for teachers is due to discuss the McCormac review of teacher employment on 23 November. The EIS and the Scottish Government will both be involved in those discussions. In my view, any suggestion of strike action by the EIS as a result of the review is therefore premature.

Kenneth Macintosh (Labour, Eastwood)

The First Minister’s colleague the Cabinet Secretary for Education and Lifelong Learning has repeatedly talked about the importance of high-quality teaching and the professionalism of our teaching staff. How does freezing the pay of teachers, cutting the pay of supply teachers and now changing their conditions of employment improve the quality and professionalism of teachers?