Scottish Parliament, 11 March 2015

251 contributions from 53 members. The official report.

Culture, Europe and External Affairs

John Scott (Conservative, Ayr)

Good afternoon, everyone. The first item of business is portfolio questions. In order to get in as many people as possible, I would be grateful for short questions and answers.

Jewish Culture (Support)

Bob Doris (Scottish National Party, Glasgow)

1. To ask the Scottish Government how it seeks to support Jewish culture in Scotland. (S4O-04094)

Humza Yousaf (Scottish National Party, Glasgow)

The Scottish Government recognises and values Scotland’s Jewish communities and the contribution that they make to our nation. Most recently, we provided £10,500 to the Scottish Council of Jewish Communities to continue its being Jewish in Scotland project, which explores how attitudes to being Jewish in Scotland have changed over the past year. That money is on top of the £21,750 that was provided in 2011-12 to create a picture of contemporary Jewish life in Scotland.

The Scottish Government also supports, as the member will know, the annual commemoration of Holocaust memorial day through a grant to Interfaith Scotland. On 27 January, the First Minister attended the 2015 national Scottish Holocaust memorial day in Ayr.

Bob Doris (Scottish National Party, Glasgow)

Does the minister agree that the celebration of Jewish culture is an expression of the tolerant and inclusive Scotland that we all want to nurture? Will he take this opportunity to pay tribute to our Jewish communities, which have contributed to Scottish society, and to express our solidarity with them at a time of heightened anxiety due to the increase in anti-Semitic abuse and attacks?

Humza Yousaf (Scottish National Party, Glasgow)

I thank the member for raising that important point. We stand absolutely shoulder to shoulder with the Jewish community here in Scotland, whose contribution is vast. We all know that it has contributed to our economy and our education sector; its contribution has also been social and cultural. We should celebrate that, and all of us across the chamber, regardless which party we belong to, have a duty to stamp out anti-Semitism wherever it exists.

On the attacks, although there is a lot more work to be done, I am pleased to note that there has been a 15 per cent decrease in anti-Semitic incidents, which is a 35 per cent decrease from the year before. However, there is a heck of a lot to be done. [Humza Yousaf has corrected this contribution. See end of report.]

My final point is that, at a time of inflamed rhetoric around immigration and migration, it is important that all of us stand with a united voice to say that those who seek to divide us should not be allowed to do so—not now; not in the future.

Anne McTaggart (Labour, Glasgow)

How does the minister seek to support the Jewish culture in the education system?

Humza Yousaf (Scottish National Party, Glasgow)

Religious education is a matter for local authorities. However, there should be as much exchange of information as possible. An important part of school when I was there was to learn from Jewish pupils and those from the community directly. I know that the Scottish Council of Jewish Communities has programmes in which it goes into schools and community members speak about their different traditions.

I am more than happy to speak to the Cabinet Secretary for Education and Lifelong Learning to see what is going on and to provide the member with a fuller answer. However, the more that we can promote interaction among communities, the better.

Creative Scotland Project Support (Aberdeen and Aberdeenshire)

Richard Baker (Labour, North East Scotland)

2. To ask the Scottish Government what proportion of Creative Scotland’s project funding was spent in Aberdeen and Aberdeenshire in the past year, and how many projects in Aberdeen received support. (S4O-04095)

Fiona Hyslop (Scottish National Party, Linlithgow)

In 2013-14, Creative Scotland provided almost £1.8 million for 27 awards in the Aberdeen city area and almost £2.2 million for 30 awards in the Aberdeenshire area. That represents its total spend in those areas.

Creative Scotland has advised that it is not possible to identify the amount of funding that was project specific and to frame that as a proportion of total project spend.

Projects supported include the youth music initiative, as well as support for artists and cultural venues, including Aberdeen Performing Arts and North East Arts Touring, which works in Aberdeenshire. More recently, Creative Scotland awarded £130,000 to the sound festival, which is based in Aberdeen, for its work in 2015 and 2016.

Richard Baker (Labour, North East Scotland)

Independent analysis carried out by members of the arts community in the north-east shows that Creative Scotland’s per capita spend is less than £10 in Aberdeen but more than £50 in Edinburgh and Glasgow.

Does the minister agree that the figures show that Creative Scotland should be doing more to support the arts in Aberdeen and the wider north-east, particularly when there are many exciting projects to support, such as the youth festival and the sound festival, which the minister mentioned, as well as the work of our theatres? What will she do to ensure that there is more investment in the arts in the north-east?

Fiona Hyslop (Scottish National Party, Linlithgow)

In 2013-14, Aberdeen city ranked 14th for investment per head of population, which is mid-table; Aberdeenshire was 13th. I have not seen the analysis that the member referred to, but it probably reflects the funding for the national performing companies and collections that are based in Edinburgh and Glasgow. Four of the five national performing companies are based in Glasgow.

When the Scottish Cabinet met in Aberdeen, I met representatives from Aberdeen Performing Arts and I am delighted that it is receiving regular funding, which is a major achievement for that cultural body. We discussed the importance of the companies, particularly in providing support through performance. Of course, they already do that, but Aberdeen Performing Arts did it during the fantastic renovation of the music hall, which was also funded through Scottish Government public bodies and agencies, including Historic Scotland.

I recognise that there might be a disparity in funding but that is because of the national performing companies. It is also precisely why the Government insists that, as part of its relationship with the national performing companies, they should perform, as they regularly do, in Aberdeen. That will not appear in the figures in the report that Richard Baker has cited.

Film and Television Studio

Hanzala Malik (Labour, Glasgow)

3. To ask the Scottish Government when it plans to announce details of a new film and TV studio in Scotland. (S4O-04096)

Fiona Hyslop (Scottish National Party, Linlithgow)

As I stated at my evidence session at the Economy, Energy and Tourism Committee on Wednesday 4 February, Scottish Enterprise has received a new proposal to provide studio infrastructure for Scotland. That proposal is subject to due diligence and is commercial in confidence at present. However, I anticipate being able to confirm whether the proposal is viable in April 2015.

Hanzala Malik (Labour, Glasgow)

I am grateful that there is some movement. Considering that the issue has been going on for some years now with no visible progress, will the minister assure me that the Scottish Government and the Scottish film studio delivery group are taking all necessary steps to ensure the creation of a Scottish film studio? When will we see real progress on the Glasgow site?

Fiona Hyslop (Scottish National Party, Linlithgow)

On the point about Glasgow, I refer the member to my evidence in which I set out quite clearly that, in terms of propositions, we cannot have a private sector tender when Glasgow’s response was specifically for a 100 per cent publicly funded studio. However, I recognise the skills and existing infrastructure in Glasgow, and I have tasked the film studio delivery group with looking at different options further to the one that has been provided. That relies on business coming through the door, the economy and any opportunities.

When “Outlander” starts to be broadcast in the United Kingdom, people will see the importance of the film industry and the investment that it can bring. We recognise that more can be done, but we already invest a record amount in the film industry that is far more than the previous Administration did. There is huge potential in the industry, and I reaffirm to the member my and the Government’s commitment to the sector.

Stewart Maxwell (Scottish National Party, West Scotland)

I was interested to hear Hanzala Malik’s comments about progress. Could the cabinet secretary outline the current level of Scottish public sector investment in the screen sector and how it compares with that of 2007-08?

Fiona Hyslop (Scottish National Party, Linlithgow)

The current proposal is to support the sector with £21 million; the previous Administration invested far less than that. Creative Scotland invests £8 million in the screen sector. Prior to that, I think that the figure was approximately £3 million, so there has been a big increase in direct film subsidy. The total for the film and television sector as a whole is £21 million, which is considerable. The investment is not just in film but in television; in focusing on the film sector, it is important that we do not forget the television sector.

European Commission (Discussions)

Alison Johnstone (Green, Lothian)

4. To ask the Scottish Government what recent discussions it has had with representatives of the European Commission. (S4O-04097)

Humza Yousaf (Scottish National Party, Glasgow)

Scottish Government ministers and officials regularly meet the European Commission to advance the Government’s agenda across a range of portfolios. For example, I met officials from the Commission’s trade directorate-general on 19 February for a factual briefing on trade policy that covered a range of issues, including the transatlantic trade and investment partnership.

Alison Johnstone (Green, Lothian)

I will indeed ask about TTIP. The deal risks much more than public services such as the national health service. Yesterday, Westminster’s Environmental Audit Committee pointed out that 1,300 cosmetic chemicals are restricted in Europe, compared with 11 in the US. Does the minister agree that TTIP will weaken our environmental and public health protections, and will he write to the Commission and United Kingdom ministers to voice opposition before the negotiations enter their ninth round, in April?

Humza Yousaf (Scottish National Party, Glasgow)

I appreciate Alison Johnstone’s concerns about TTIP, many of which this Government shares. The First Minister wrote to the Prime Minister to outline a number of those concerns, including concerns about the NHS and public services, which Alison Johnstone mentioned, as well as investor-state dispute settlement and the transparency of the negotiations. As Alison Johnstone rightly suggested, we want to maintain standards, not lower them.

We have had assurances, but it is difficult to oppose TTIP without seeing a final agreement. We will continue to put forward all our concerns constructively. We have asked for specific things in TTIP, such as a black and white exemption for the NHS in the text of the agreement. The pledge on that was signed by members of the Cabinet and by the First Minister.

I am more than happy to meet Alison Johnstone. We have written to the Commission and the UK Government on these matters and I can get her copies of those letters and their responses, where appropriate. We certainly agree that TTIP or any agreement, if there is an agreement, must be about raising standards, not lowering them.

Claire Baker (Labour, Mid Scotland and Fife)

The minister may be aware of the Commission’s proposed cuts to horizon 2020—a fund from which many Scottish universities benefit. What representations has the Scottish Government made on that?

Humza Yousaf (Scottish National Party, Glasgow)

I am aware of the issue, which I recently raised with David Lidington, the UK Government’s Minister for Europe. I mentioned that, for exactly the reasons that Claire Baker raises, we would have serious concerns if any funds for President Juncker’s investment package were taken from horizon 2020.

To put the issue in context, the money deducted from horizon 2020 is specifically for President Juncker’s package. Universities should be able to benefit from that and I hope that in Scotland they will. We share the concerns, and there should be no further reduction in horizon 2020 funding.

Jamie McGrigor (Conservative, Highlands and Islands)

What discussions has the Scottish Government had with the European Commission about its proposed energy union? Does the minister agree that completion of such a union would help to integrate Scotland into a pan-European energy market?

Humza Yousaf (Scottish National Party, Glasgow)

I am more than happy to give Jamie McGrigor copies of the correspondence and notes of the discussions that we have had, including the conversations that the cabinet secretary has had and any other conversations. We agree that there are potential benefits for Scotland, which is another good reason why Scotland most certainly should remain a member of the European Union.

Neil Findlay (Labour, Lothian)

In his discussions with the European Commission, did the minister raise the economic and political situation in Greece? Recently, the Greek people democratically elected a Government on a manifesto to oppose austerity, only for that Government to be immediately prevented from enacting that manifesto by the troika of the Commission, the International Monetary Fund and the European Central Bank. Why was there no protest from the Scottish Government or Governments across Europe about that democratic outrage?

Humza Yousaf (Scottish National Party, Glasgow)

When the Greek Government was elected, I sent the Greek Prime Minister a message to congratulate him on getting his position, but I noticed that Ed Miliband did not make a single comment of congratulation to Syriza—he was hiding away.

Neil Findlay is more than well aware that, because of the recent referendum, our voice in the European Union is represented by the UK Government. I wish that we had a greater voice and I hope that Neil Findlay will support us in our discussions about the Smith commission, so that Scotland can have a voice and be a counterbalance. He is correct to allude to the fact that this Government is anti-austerity, unlike the party that he represents.

The Deputy Presiding Officer

Question 5, in the name of Jenny Marra, was not lodged, and a less than satisfactory explanation was provided. Similarly, question 6 was not lodged, and a less than satisfactory explanation was provided.

Television Licence Fee Replacement

Stuart McMillan (Scottish National Party, West Scotland)

7. To ask the Scottish Government what its position is on the impact on devolved areas of responsibility of reported plans to replace the TV licence fee with a household tax. (S4O-04100)

Fiona Hyslop (Scottish National Party, Linlithgow)

There are no plans to replace the television licence fee with a household tax in the context of the renewal of the BBC’s royal charter on 1 January 2017. However, on Thursday 26 February, the House of Commons Select Committee on Culture, Media and Sport published its report “Future of the BBC: Fourth Report of Session 2014-15”, in which it stated:

“There currently appears to be no better alternative to funding the BBC in the near-term other than a hypothecated tax or the licence fee.”

The report also looked at the possibility in the longer term of introducing a broadcasting levy that would apply to all households.

The director general of the BBC, Lord Hall of Birkenhead, indicated in a speech to BBC staff on Monday 2 March that he saw some merit in the idea of a broadcasting levy. Against a background in which annual funding for BBC Scotland will have fallen from £102 million to £86 million by the time the charter is renewed, the Scottish Government will be making the case for adequate resources, publicly funded, and for reflecting the £320 million that Scotland contributes through the licence fee to produce the high-quality programming that Scotland deserves, under any approach to funding.

Stuart McMillan (Scottish National Party, West Scotland)

I recently conducted a survey in which 74 per cent of the 1,600 constituents who replied agreed that broadcasting should be devolved to this Parliament. Does the cabinet secretary agree with me and my constituents—bearing in mind her comments about the £320 million that Scotland contributes and the reduction in annual funding for BBC Scotland to £86 million—that such powers should be devolved so that we in this chamber can decide on any changes or alternatives to the TV licence fee and how that income is spent?

Fiona Hyslop (Scottish National Party, Linlithgow)

I agree with that. In our submission to the Smith commission, we made the case for the devolution of broadcasting, including the licence fee, as part of a coherent package of reforms on a devo-max model. It is disappointing—although it is not the first such disappointment—that the Smith commission outcome fell short. However, we will use the formal consultative role for the Scottish Parliament that is proposed over the renewal of the BBC charter—as I am sure the Parliament will—to press the case for more production for and from Scotland.

Community Arts Groups (Rural South Scotland)

Claudia Beamish (Labour, South Scotland)

8. To ask the Scottish Government what support it has given to community arts groups across rural South Scotland in the last year. (S4O-04101)

Fiona Hyslop (Scottish National Party, Linlithgow)

In 2013, Creative Scotland invested more than £3 million in 94 awards to artists and organisations in South Scotland. Those awards included support for the artistic programmes at the Boswell book festival, the Lammermuir festival and the Alchemy film festival.

In 2014-15, Creative Scotland awarded capital funding for Moat Brae in Dumfries and for the Ayr Gaiety theatre. Creative Scotland is also investing more than £500,000 from 2015 to 2018 in the Ayr Gaiety Partnership, the Stove Network and the Wigtown Festival Company as organisations with regular funding.

Claudia Beamish (Labour, South Scotland)

Lanark memorial hall, which South Lanarkshire Leisure and Culture manages for South Lanarkshire Council, offered the use of its box office to a community group—Music in Lanark—to support its production of “Madame Butterfly”. Although that model involved a relationship with the local authority, will the cabinet secretary consider providing funding to support such ventures to ensure that communities have access to excellent venues across South Scotland and beyond, the cost of which is often beyond groups’ means?

Fiona Hyslop (Scottish National Party, Linlithgow)

Claudia Beamish makes an interesting point. Skills and experience can often be shared more widely in areas such as box office, back-room staffing and administration. That can allow a small amount to go an awful lot further, and I am interested in how that can help to build capacity. Our national companies could also provide such support, and we must look at the network of voluntary cultural work that takes place, which is the life-blood of many communities. I am sure that members will have seen the Lanark exhibition in the Parliament last week, and I commend the activities in that area.

2015 Edinburgh Festivals Expo Fund

Claire Baker (Labour, Mid Scotland and Fife)

9. To ask the Scottish Government how much funding is available for the 2015 Edinburgh festivals expo fund and when the details will be announced. (S4O-04102)

Fiona Hyslop (Scottish National Party, Linlithgow)

I was delighted to announce on 6 March further investment of £2.25 million to support the Edinburgh festivals through the Scottish Government Edinburgh festivals expo fund. Scottish Government expo fund investment has been transformative for the festivals and their artists. It helps to showcase them on an international platform, and we have only to look at the range of Scottish artists, including Don Paterson, Ali Smith and James Robertson, and Martin Creed with his work on the Scotsman steps, to identify some of the world-class art that is being undertaken here. The expo fund has made a major contribution to exporting and showcasing that Scottish cultural talent.

Claire Baker (Labour, Mid Scotland and Fife)

Following the lodging of my question last week, the cabinet secretary helpfully made her announcement on Friday, which is welcome. How can we support festival programmes in other cities? Edinburgh’s programme is unique and international, but how do we increase opportunities for other cities across Scotland?

Fiona Hyslop (Scottish National Party, Linlithgow)

The Edinburgh festivals contribute £250 million to the local economy and more widely. They are a cultural calling card not just for Edinburgh but for Scotland. However, the member rightly identifies the role of other festivals.

For example, Celtic Connections has regular funding from Creative Scotland, and I am delighted that the St Magnus international festival in Orkney has similar funding. There is similar support for other festivals, and it is important that new festivals can also get support, either from EventScotland or Creative Scotland.

There are avenues through which we already support festivals, but I am working with VisitScotland on how—with VisitScotland, EventScotland and Creative Scotland—we can make more of the wonderful all-year-round offer from the festivals throughout Scotland.

The Deputy Presiding Officer

Question 10, in the name of Cara Hilton, was not lodged and, disappointingly, no explanation has been given.

Aberdeen City Deal

Lewis Macdonald (Labour, North East Scotland)

1. To ask the Scottish Government how it plans to contribute to the proposed city deal for Aberdeen. (S4O-04104)

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

We are always happy to consider new proposals and ideas to stimulate economic growth. We are working with Aberdeen City Council and Aberdeenshire Council to establish the detail of what a city deal for their region is intended to deliver. We remain absolutely committed to working with all our cities to unlock investment, whether for them individually or collectively.

Lewis Macdonald (Labour, North East Scotland)

I thank Keith Brown for that positive response. He will be aware, of course, that the city deal proposal that was published this week emphasises the need for improvements to rail infrastructure north and south of the city of Aberdeen. Does he agree that dualling the stretch of single-track railway line at Montrose would strongly support the city deal proposals by linking an enhanced rail network around Aberdeen with the central belt? If he does agree that that would be significant, can he tell us when the Government will make a decision on whether or not such an improvement should be included in its instructions to Network Rail for control period 6, which starts in 2019?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I think that we all recognise—it has been recognised for a number of years now—the constraint that the Montrose Basin presents in relation to that proposal, which would be a very substantial project in its own right.

Having received the city deal just this week, it is only right that we take some time to look at it—as you would expect us to do—to see where we can possibly work together and what we can support in relation to what is represented.

However, whether the Montrose Basin features in control period 6 will be a matter for discussion between me, the Minister for Transport and Islands and officials. I recognise that the suggestion is a long-standing ambition for people. It is also one of the ways in which we could achieve a substantial difference in capacity on that line and in journey speeds. Of course, it is something that we wish to do at the earliest opportunity, but it will have to be set beside other priorities. A decision on that will be taken in due course.

Alison McInnes (Liberal Democrat, North East Scotland)

As we would expect from a programme that was developed and championed by Liberal Democrats in the United Kingdom Government, city deals are designed to give local bodies greater control over spending and decision making. After years of centralisation by the Scottish National Party Government, does the cabinet secretary consider that this is an opportunity to start to reverse that unwelcome trend and to initiate the transfer of powers from the Scottish Government back to local communities?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

I certainly remember that I, as a council leader, had to spend a very substantial chunk of our budget on priorities that were set by the then Liberal Executive, back in the period between 1999 and 2007. The biggest move towards decentralisation was the lifting, by this SNP Government, of hypothecated expenditure. That is a substantial move towards decentralisation that undermines Alison McInnes’s claim to be in favour of decentralisation.

We have done a great deal to make sure that councils can spend according to their own priorities. Of course, I accept that there have been constraints—not least those that have been imposed by the Government in Westminster that Alison McInnes supports. We have a smaller cake to distribute, but we have looked after local government and we will take a positive approach to what we have been presented with by Aberdeen City Council and Aberdeenshire Council in relation to the city deal. However, we first have to take some time to look at the deal.

Rail Investment Plans (South Scotland)

Jim Hume (Liberal Democrat, South Scotland)

2. To ask the Scottish Government what rail investment plans it has for South Scotland. (S4O-04105)

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

Over the next five years, the Scottish Government is investing £5 billion across the Scottish rail network, including in South Scotland, with service improvements in Dumfries and Galloway, the introduction of great scenic railways on three lines, and an investment of £353 million in the Borders railway, which will re-establish passenger railway services between Edinburgh, Midlothian and the Scottish Borders for the first time since 1969.

Jim Hume (Liberal Democrat, South Scotland)

Given the support that the Borders rail project has received in the recent past from the minister, the former First Minister and VisitScotland, which called it “a tourism magnet”, does he agree with me and local campaigners that the Scottish Government should now take the chance to build on the work of the Lib Dems in coalition in passing the Waverley Railway (Scotland) Act 2006, and commission a feasibility study into extending the line on to Hawick and beyond to Carlisle for the economic benefits that that would bring to even more communities in the Borders?

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

It appears to me that the Liberal Democrats think that they are at the moment living in some sort of parallel universe where their popularity is soaring.

We can all work together across the chamber on good projects; the Borders railway is a good example and people from across the political spectrum have supported that project.

We have said it before and will say it again: we will judge the line’s success and then make judgments on how it may be extended in the future. However, if the success of rail is anything to go by—it has exceeded forecasts—the line has a strong future in the transport mix. I am sure that the Borders railway will be a success. We will continue to invest in expansion of our railways and will make all future judgments based on performance.

ScotRail Franchise (Handover)

Clare Adamson (Scottish National Party, Central Scotland)

3. To ask the Scottish Government what progress is being made with the handover of the ScotRail franchise. (S4O-04106)

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

Significant progress continues to be made towards the handover of the ScotRail franchise to Abellio on 1 April. We expect the new franchise to build on the success of ScotRail and to add for passengers more quality and efficiency improvements to our rail network. In addition to the improvement commitments that have been secured, we are encouraged by the progress on the deep alliance with Network Rail, which will improve partnership working on the railways in order to improve passenger experiences.

Clare Adamson (Scottish National Party, Central Scotland)

The minister mentioned benefits to passengers. Will he confirm that rail fares will not be subject to above-inflation increases under the new franchise?

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

Yes. We have secured a fares arrangement that will ensure that peak fares are capped at the level of the retail prices index, and that off-peak fares are capped at RPI less 1 per cent. We will also have a club 50 smart card and reduced travel costs for jobseekers and newly employed people.

That fares policy is in addition to the station improvements, new trains, better digital infrastructure, smart ticketing, integrated transport, the great scenic railways, protection for staff under the Transfer of Undertakings (Protection of Employment) Regulations and improved journey times. That seems to me to be the best deal that was possible and it was secured by this SNP Government and the Cabinet Secretary for Infrastructure, Investment and Cities.

The Deputy Presiding Officer

I have a huge number of requests for supplementary questions.

Richard Simpson (Labour, Mid Scotland and Fife)

One of ScotRail’s attendants told me that they will issue clogs on 1 April. I am sure that that is not true. [Laughter.]

We all hope that the transfer of the franchise progresses well, but I remind the minister of the current overcrowding at peak times on the Dunblane and Alloa routes from Glasgow and Edinburgh, and the record number of fines for reduced coach numbers that were achieved under the current ScotRail franchise. Will he undertake to provide further information on the reduction in the number of coaches on the trains to Dunblane and Alloa that I am told is projected will take place when the route to the Borders opens?

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

I am happy to look further at the detailed information, but overall there will be no reduction in capacity. In fact, we want to achieve greater capacity for passenger numbers through procurement of new trains, which I will discuss with the chief executive of Abellio later today.

I will also assess the new information that we will have; we will be able to assess capacity, numbers and overcrowding. That will inform further investment in, and management of, the rolling stock and should helpfully show us where further resources need to be deployed in partnership with Abellio. I will be happy to share that information with Richard Simpson in due course.

Alex Fergusson (Conservative, Galloway and West Dumfries)

The minister has been extremely helpful in trying to persuade Abellio to improve the train services that the company offers my constituents in Stranraer and Wigtownshire. The reintroduction of the early-morning direct train is welcome, but might the minister be able to persuade Abellio to include a direct service between Stranraer and Glasgow on Sundays? That would help to give my constituents the impression that they have a meaningful service that is geared to their needs rather than that they are something of an afterthought in the negotiations.

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

I thank Alex Fergusson for recognising the effort that I have put into trying to improve the service to and from Stranraer. That takes me to a point around consultation between the operator and communities. We should consult not only the existing travelling public and rail passengers, but more widely with transport partnerships, local authorities and potential rail users. If we were to do that, we could helpfully shape services that people want.

I have worked quite hard on improving services between Stranraer and Glasgow; there will be an improved service with better journey times and improved connections, and that direct service is being restored as part of the current-priced model. I am not sure whether we can push much further on a cost-neutral basis, but I am happy to look into the Sunday service option that was suggested by Alex Fergusson.

John Wilson (Independent, Central Scotland)

I welcome the minister’s comments about discussions with Abellio. Can he give us some assurances that rolling stock will not be affected? As far as I am aware, the rolling stock that Abellio has promised will not be in place until 2017. Can the quality and the age of the carriages that passengers are being asked to use be improved prior to that date?

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

We will work closely with Abellio, through Transport Scotland, in relation to new and existing stock. I can give the assurance that, on handover, there are sufficient trains to provide the service that is proposed. However, surely we have to welcome the multimillion-pound investment that will bring new electric trains to the network on our newly electrified lines. That will ensure better journey times, improved services and better passenger experience, and will have massive environmental benefits in terms of emissions.

We will welcome the new fleet, which will be deployed from 2017 onwards in a managed way and will significantly enhance the rolling stock that we have. Furthermore, the deal that we have produced gives the Scottish Government the option to retain the trains, which is a novel approach in procurement of rail stock in Scotland.

Future Transport Fund (Active Travel)

Colin Beattie (Scottish National Party, Midlothian North and Musselburgh)

4. To ask the Scottish Government what investment will be made in active travel using the future transport fund. (S4O-04107)

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

The budget for the future transport fund in 2015-16 is £20.25 million. Decisions on the allocations, including to active travel, are still to be taken. An announcement will be made in due course.

Colin Beattie (Scottish National Party, Midlothian North and Musselburgh)

The minister will be aware of the Borders railway project, which goes through my constituency. Can he outline the ways in which active travel will be promoted through the railway?

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

We will work closely with Abellio, which has experience of active travel—and cycling, of course—to bring some of that expertise to Scotland. In the new franchise, based on the contract there will be enhanced capacity, more bike schemes at local stations and better information on integrated transport. However, through a range of various funds, including the future transport fund, I hope to be extremely supportive of cycling and active travel. I will make spending announcements in due course.

Charrette Process (Development of Cities)

Patricia Ferguson (Labour, Glasgow Maryhill and Springburn)

5. To ask the Scottish Government whether it considers the charrette process an effective means of investing in the development of cities and what support accompanies it. (S4O-04108)

Marco Biagi (Scottish National Party, Edinburgh Central)

Charrettes provide opportunities for local people and public and private sector bodies to participate collaboratively in decisions relating to their communities.

We believe that the charrette process is an effective and efficient means of investing in the development of Scotland’s cities, towns and rural areas. Since 2011, we have allocated grants and provided advice to support the delivery of 31 charrettes across Scotland, including seven in our cities.

Patricia Ferguson (Labour, Glasgow Maryhill and Springburn)

I thank the minister for that information, and I agree with him in his assessment of it. As he knows, two very well-attended and ambitious charrettes have recently been held in my constituency. Local groups and organisations as well as many individuals and agencies worked together very well to develop a series of coherent and dynamic ideas that will help to shape the future of Speirs Wharf and Hamiltonhill and that have the potential to be transformational for those communities.

Will the Scottish Government invest in the opportunities that are identified through the charrette process?

Marco Biagi (Scottish National Party, Edinburgh Central)

I was at the Woodside, Firhill and Hamiltonhill charrette on its final day, and I saw the inputs from the collaborative process. I was very impressed by the level of vision, but also by the connection with some ideas that people just sitting in offices behind their desks might not have been able to come up with.

The two charrettes were set up as local development plan charrettes. Their aim was to create supplementary guidance for the council, as part of the overall regeneration of those areas. That is something that the Scottish Government will be keen to participate in. It is fair to say that the best charrettes occur where there is a desire to regenerate, some resource behind it and some movement taking place, so that a vision can be devised that people and agencies can then put into place.

Speed Limits on Trunk Roads (Highlands and Islands)

Jamie McGrigor (Conservative, Highlands and Islands)

6. To ask the Scottish Government what plans it has to alter speed limits on trunk roads in the Highlands and Islands. (S4O-04109)

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

We have recently updated the findings of the speed limit review, and we remain committed to improving safety on our network by delivering speed limit reductions where they are justified, as part of our wider programme of road safety measures. The updated findings of the review support our decision not to progress with proposed speed limit reductions in five locations across the network, including two on the A87, two on the A95 and one on the A84.

We will continue to engage with communities in promoting road safety across Scotland, and we welcome the comments and responses received in the course of this engagement. I have given a fuller response in a parliamentary answer on 6 March regarding matters of process.

Jamie McGrigor (Conservative, Highlands and Islands)

I have been contacted by a number of Argyll constituents, including local businesspeople, who are opposed to Transport Scotland’s proposal to reduce the speed limit on the A83 trunk road between Tarbert and Ardrishaig to 50mph. Local businesses have expressed the view that the proposed reduction is not based on concrete evidence that it will reduce accidents and that instead it will increase driver frustration while slowing down journey times and reducing the area’s economic competitiveness.

Surely an improvement to and widening of parts of this narrow road would be a more effective solution. Will the minister undertake to look into this issue and address the concerns of Argyll residents and businesses?

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

Yes, of course; I will consider the matter closely. That is exactly why, when other members have raised the proposed speed limit reductions, I have had a look at the data and the case to ensure that the change is justified. That just goes to show that, with the level of engagement and consultation that we have had, sometimes we can change our minds if the case is made.

Safety will be paramount in all of this. We will have the speed limit that is appropriate to the circumstances and that the geography and the topography allow.

On resources, of course we will want to address more of the road network in terms of additionality to the commitments that we have made. However, it would have been so much better had our capital budgets not been reduced as a consequence of the decisions of the Conservative Party, of which Mr McGrigor is a member.

David Stewart (Labour, Highlands and Islands)

Does the minister share my view that the heavy goods vehicle 50mph pilot on the A9 has been an excellent initiative? Has there been any early feedback from the police, hauliers and road safety organisations on how effective the pilot has been in practice?

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

All the evidence that we have to date is that the package of measures on the A9 has been a success. The package is a mixture of average-speed cameras, changes to the speed limits and a wider campaign on driver behaviour. Because of those measures, excess speed and average speed are down. When, in the fullness of time, we look at the number of road incidents as well, we can make a further judgment.

The HGV speed limit, as part of that package, seems to be a success and it has been welcomed by all the partners involved. There is a wider issue of changes south of the border, and we will take an evidence-based approach on whether that is relevant here. It strikes me that it is part of the package of measures on the A9 that has worked, but that does not necessarily mean that it should be deployed across the country.

Glasgow and Clyde Valley City Deal

Stewart Maxwell (Scottish National Party, West Scotland)

7. To ask the Scottish Government what recent discussions it has had with local authorities regarding the Glasgow and Clyde valley city deal. (S4O-04110)

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

In August 2014, the Scottish Government agreed to contribute £0.5 billion over 20 years to support a deal for Glasgow and the Clyde valley that empowers the Glasgow and Clyde valley partners to identify, manage and deliver projects that will stimulate economic growth and create jobs in their area.

The Glasgow and Clyde valley partners are developing an assurance framework that will ensure that their investment decisions are based on sound business cases and that projects are delivered effectively. The assurance framework will respect local decision making and must be approved by United Kingdom and Scottish Government ministers before any funding is released. Officials continue to work closely with the Glasgow and Clyde valley partners and the UK Government to finalise the assurance framework.

Stewart Maxwell (Scottish National Party, West Scotland)

How will the Glasgow and Clyde valley city deal ensure that the benefits that are derived from economic growth are spread across not just Glasgow but the entire Clyde valley region, including the most deprived areas?

Keith Brown (Scottish National Party, Clackmannanshire and Dunblane)

The terms of the deal are clear. It empowers the Glasgow and Clyde valley partners to identify, manage and deliver projects that will stimulate economic growth and create jobs in their area. It also specifically states that it will

“Spread the benefits of economic growth across Glasgow and Clyde Valley, ensuring deprived areas benefit from this growth.”

The Scottish and UK Governments have been working with Glasgow City Council and its partners on the development of the assurance framework, which will ensure that investment decisions that are taken by Glasgow City Council and the Clyde valley partners are based on sound business cases and that projects are delivered effectively.

Scotland’s Economy

John Scott (Conservative, Ayr)

The next item of business is a debate on motion S4M-12591, in the name of Jackie Baillie, on supporting Scotland’s economy.

Jackie Baillie (Labour, Dumbarton)

I welcome the opportunity to open the debate on behalf of the Labour Party. Just this morning, the much-anticipated “Government Expenditure and Revenue Scotland” account for 2013-14 was published. The GERS report sets out how much we spend in Scotland and how much we raise in any given year. In effect, it is the balance sheet for public finances, and it is a hugely important measure of the nation’s financial health.

I will consider the numbers in a minute, but let me first set the context. As we approach the general election, the people of Scotland are being asked to make a choice between two competing visions of devolution while remaining in the United Kingdom. This is not about the past or the referendum; it is about our future.

On the one hand, Scottish Labour’s vision is of a powerhouse Parliament with more control over taxation and welfare, together with the continuation of the Barnett bonus providing stable spending for our public services, such as schools and the national health service, and the retention of the United Kingdom-wide pension system, which millions of Scots have paid into over the years and which almost 80 per cent want to remain paid on a UK basis.

On the other hand, we have the Scottish National Party’s plan for full fiscal autonomy. That means that Scotland would raise all its own taxes to cover its expenditure. When Alex Salmond was the First Minister, he supported full fiscal autonomy, and he had this to say about what it meant:

“Home rule is control of all domestic affairs and taxation. Reserved to Westminster would be foreign affairs and defence.”

Nicola Sturgeon, as the new First Minister, agreed with him. In an interview with Andrew Marr in late January, she confirmed that and said:

“I want full fiscal autonomy for the Scottish Parliament.”

There we have it: that is SNP policy and that is what it will go into the general election advocating—full fiscal autonomy within the United Kingdom. The Scottish Parliament would collect all the taxes, it would be responsible for all the spending, including on pensions and welfare, and it would make payments to the United Kingdom for reserved areas such as defence and foreign affairs. The Scottish Government would also have new borrowing powers, which it would need to make up any deficit.

The choice is therefore between Labour’s approach of guaranteeing new powers for the Parliament with the advantage of the Barnett bonus, and the SNP’s approach of full fiscal autonomy, under which we would raise all our money and would not have any share in the resources of the United Kingdom.

Mike MacKenzie (Scottish National Party, Highlands and Islands)

Does the member agree that, given that Labour members of Parliament marched through the lobbies to vote for austerity, what Labour advocates is continuing—in fact, more—austerity for Scotland?

Jackie Baillie (Labour, Dumbarton)

I have never heard such utter nonsense. Labour does not support Tory austerity. We voted to balance the budget. John Swinney sets great store by balancing the budget. Last week, however, SNP MPs sat on their hands and refused to back a motion that would end Tory austerity, so I will take no lessons from the SNP on the issue.

Let me illustrate the numbers to show what the choice means in reality. “Government Expenditure and Revenue Scotland” tells us that Scotland spends more per head than the UK average—in fact, we spend about £6 billion a year more. Overall, we raise less in tax revenue than the rest of the UK, and the tax shortfall this year is of the order of £2 billion. Scotland’s fiscal gap—our relative deficit—is £8 billion. We would need to find £8 billion a year to get to the same place as the UK’s public finances. That is widely accepted by economists, and the Institute for Fiscal Studies and Brian Ashcroft have confirmed it today.

Under full fiscal autonomy, we would need to raise enough money to plug the gap just to match the UK deficit. Of course, we have oil, which is incredibly important to our economy and to our public spending. The oil and gas industry is a Scottish success story, and the revenues that we have gained have been a real bonus to our public services. There is no doubt, however, that times are tough. We have experienced volatility and a decline in revenues. GERS 2012-13 told us that the revenue from oil had dropped to £4 billion. This year, GERS shows that we are running a deficit of £12 billion a year, which is unsustainably high. This is a sombre day for Scotland.

The First Minister noted that the deficit is down on last year, and indeed it is. However, in noting that, she is taking credit for Tory austerity cuts. Taxes have gone down and the deficit has been cut only because of a cut in spending: tartan Tories, indeed.

Mr Swinney needs to stop saying that we pay an extra £400 per head without mentioning that in fact we spend £1,200 more per head—a deficit of £800 per person. I ask him please to stop spinning and to give us both sides of the balance sheet.

That is all before any account is taken of the recent dramatic fall in the oil price. It is worth reminding ourselves that the SNP’s forecast for oil revenue was based on the price being $113 a barrel, but it dropped to below $50 a barrel in the new year. That is a huge loss of revenue. It is a blow to our economy and to our public finances, never mind that thousands of jobs are already lost from the sector.

For 2014-15, due to that drop in oil price and the continuing downward trend in revenues, the expectation is that we will have a £6 billion black hole in our budget. That is a staggering amount by anybody’s reckoning. Let me put it in perspective: £6 billion is half our national health service budget and is more than the entirety of the schools budget. To balance the books, we would need either to make swingeing cuts or to increase taxes. That would mean households paying an average of £2,400 per year extra just to stand still. That is what full fiscal autonomy means for Scotland.

We all—aside from those on the Tory benches opposite, of course—condemn Tory austerity plans, and rightly so, because they would take public spending levels back to those of the 1930s, when we had no NHS and when children left school at 14.

What we would get from the SNP’s proposals is austerity max. The SNP would take the Tory austerity cuts—[Laughter.] SNP members may laugh, but this is what the economists are saying. SNP members would take the Tory austerity cuts and would more than double them under full fiscal autonomy. That is the economics of the madhouse. People genuinely do not understand why the SNP would do that.

We should not worry, however, because the SNP has another plan: it is going to grow the economy to plug the gap. I am all in favour of growing the economy, but SNP members cannot seriously be suggesting that that will plug the £6 billion gap in revenues in the short term. We would need the equivalent of 12 years’ economic growth squeezed into four years—a growth rate that would be higher than China’s was in its heyday and not something that any developed country has achieved. I am all for ambition, but it needs to be rooted in just a little bit of reality. I ask SNP members not to insult our intelligence, please.

If he is trying to get us to swallow such nonsense, Mr Swinney will be in danger of losing his alleged reputation for competence. The growth that he assumes is just not possible in the period necessary and will not fill the black hole at the heart of his budget.

The consistent refrain from Mr Swinney and his back benchers in their press releases is that I am somehow talking Scotland down. Nothing could be further from the truth; I am proud of my country and our people. The fact is that the SNP will actually do Scotland in and do us all a disservice if it does not face up to reality.

People expect us to be honest about the nation’s finances, and they expect us to balance the books. Indeed, Mr Swinney is always keen to tell us how well he balances them, but the reality is that in the past he has had to balance only one side of them. The money that he spends comes from the UK Government as a consequence of the Barnett formula. However, with full fiscal autonomy, Barnett ends, and he will not be able to balance the books if there is a £6 billion black hole at the heart of his budget.

While households across the country are making tough decisions about what they can afford to do, the SNP Government is burying its head in the sand and engaging in fantasy finances. John Swinney is not only sacrificing his reputation for competence at the altar of the SNP’s obsession with full fiscal autonomy but abandoning the logic and reason that he normally brings to proceedings, and I suspect that he is embarrassed by that. I predict that, in the absence of detail, we will see a windmill display with lots of arm waving followed by some finger pointing and shouting at the Opposition benches. We will have noise and distraction instead of detail, but the fact is that, no matter the attempts to create a diversion, there is no escaping reality. The SNP response is truly desperate stuff.

However, there is more. On 3 March, the SNP published an economic analysis that showed that, with an increase in factor productivity and investment and by boosting export targets by 50 per cent, we would raise £2.8 billion in additional tax income in 10 years. Six days later, it published another document that was remarkably similar to the first. It, too, was an economic analysis, but this one said that £3.5 billion would be raised over 10 years. It is remarkable what a difference six days can make. Suddenly the tax gain has increased by £700 million. If we waited another six days, would it increase by £1.4 billion? I am just wondering; I am happy to wait patiently for an answer if the money increases by the day.

Some of the assumptions are frankly heroic. How can the Scottish Government expect exports to grow by 50 per cent when oil and gas, which represent one of our biggest exports, are declining? The economics are fascinating. Even if I am generous to the SNP, which I am always inclined to be, and go along with all its figures, there is still a gap between what we get from Barnett and what we would get from fiscal autonomy. With Barnett, we would get an additional £65 billion over 10 years compared with the £17 billion or so that we would get from full fiscal autonomy and Mr Swinney’s growth figures over the same period. Where will the missing money come from? There will still have to be cuts or tax rises to fill the gap.

By the way, what is “full revenue retention”? Is it just full fiscal autonomy by another name? It sounds painful. We searched high and low for other countries that operated full revenue retention as a policy, and the chamber will be pleased to hear that we found one. However, it was not a country—it was the Canadian national parks. The fact that the Scottish Government is now modelling its financial policy on the Canadian national parks is interesting, but I suspect that what we are witnessing is an attempt to confuse. Full fiscal autonomy is clearly not testing well with the focus groups, so the SNP is ditching the name and calling the policy something else.

It does not matter how many times the name changes—the policy is still daft. Whether we are talking about full fiscal autonomy or full revenue retention, it means the loss of Barnett, the loss of UK pension funding and a black hole of £6 billion a year. It is probably better to call the policy full fiscal austerity, because that is precisely what it is.

Chic Brodie (Scottish National Party, South Scotland)

Will the member give way?

Jackie Baillie (Labour, Dumbarton)

No.

What the SNP wants is full fiscal autonomy and Barnett, but it cannot have both. It is the old SNP—

Mike MacKenzie (Scottish National Party, Highlands and Islands)

Will the member give way?

Jackie Baillie (Labour, Dumbarton)

I have already taken an intervention from Mike MacKenzie.

It is really the old SNP notion that somehow people can stop paying into the kitty, but the kitty will still pay out to them. That does not happen in real life or in government, and John Swinney knows it.

I am genuinely surprised that John Swinney is backing a policy that lacks credibility. I can only assume that he has not convinced the former First Minister or the current First Minister that the policy is wrong. He parades round the Parliament like a peacock, but in Cabinet he ends up being a chicken.

Much of Labour’s policy offer in recent weeks has come about because of the Barnett bonus. Let us take the mansion tax as an example. We would spend £120 million extra on 1,000 nurses.

The Deputy Presiding Officer

You should draw to a close, please.

Jackie Baillie (Labour, Dumbarton)

Pension tax relief of £200 million would deliver the future fund for 18 and 19-year-olds and better bursaries. That would not happen with the SNP’s full fiscal autonomy.

In short, the SNP’s plans for full fiscal autonomy within the UK strip billions of pounds from our budget. There is no escaping that; it is a fact. Voting SNP at the general election will get austerity max: cuts to services or higher taxes, or a combination of both.

Scottish Labour has a better plan. Our plan will deliver major new powers to the Parliament, but retain the security of the Barnett bonus to protect our schools and our NHS.

That is the choice on 7 May, and the people of Scotland will choose wisely.

I move,

That the Parliament believes that full fiscal autonomy within the UK would have an immediate and detrimental impact on Scotland’s economy, particularly in light of this week’s Government Expenditure and Revenue Scotland report; recognises that it would mean that Scotland would lose out on billions of pounds for public services, such as the NHS and schools, through the consequent scrapping of the Barnett formula; further believes that this would cut Scotland off from sharing in the wealth and resources of the UK, and calls on the Scottish Government to affirm that it would be better to retain the Barnett bonus than to have full fiscal autonomy within the UK.

The Deputy Presiding Officer

We are very tight for time. The Deputy First Minister has up to 10 minutes, please.

John Swinney (Scottish National Party, Perthshire North)

I welcome this debate on Scotland’s economy. The recovery in Scotland’s economy is now well established, as I have set out to Parliament in recent weeks. We have seen more than two years of continuous growth, and both output and employment are at record levels. Since the Government came to power in 2007, the value of Scottish international exports has increased by 40 per cent, business research and development spending has increased by 29 per cent, and the Scottish productivity rate has moved from being 6 per cent lower than that of the United Kingdom to sitting at approximately the same level.

The “Government Expenditure and Revenue Scotland” figures for 2013-14 confirm some key facts about the Scottish economy. First, they confirm that Scotland continues to pay more in revenues per head to the Treasury than the rest of the United Kingdom. The report demonstrates that, in every one of the past 34 years, Scotland has raised more tax revenue per person than the rest of the United Kingdom.

Alex Johnstone (Conservative, North East Scotland)

Do those figures include oil and gas? If they do, are the figures for the current year likely to show the same promise?

John Swinney (Scottish National Party, Perthshire North)

The figures include oil and gas. We will, of course, await the outcome of 2014-15 before we know the answer to Mr Johnstone’s question.

In 2013-14, the tax revenue per person was £400 more than the UK average. Since 1999, total tax revenue per person in Scotland has been £12,000 higher than in the United Kingdom as a whole.

Jackie Baillie (Labour, Dumbarton)

Does the cabinet secretary accept that spending in 2013-14 was £1,200 per head higher than in the rest of the UK?

John Swinney (Scottish National Party, Perthshire North)

I will look at the rounded position in a second.

Secondly, the report confirms that the overall deficit in Scotland is reducing. From 2012-13 to 2013-14, the net fiscal balance fell from 9.7 per cent of gross domestic product to 8.1 per cent, despite lower oil revenues because of high levels of capital investment. That shows our continued economic strength.

Thirdly, the report shows for the first time the position of Scotland compared with other parts of the United Kingdom. Scotland pays more in revenues than anywhere except London, the south-east and the east of England.

Fourthly—this addresses the issue that Jackie Baillie raised—the report shows that in some years we have a stronger current budget balance than the UK as a whole and in some years it is lower and weaker. Scotland has been in a stronger position in two of the past five years—2010-11 and 2011-12. In three of the past six years, Scotland has been in a stronger position on balance than the rest of the United Kingdom. It is important to look at the pattern of those figures in a number of years and not at just one particular year.

The figures show that the fundamentals of our economy are strong. Scotland is, and continues to be, a wealthy country.

However, “Government Expenditure and Revenue Scotland” does not show what the position would be like if we could invest from the relatively stronger financial position that we have had in previous years to generate growth or reduce the debt, such as the £4.5 billion relative surplus over the United Kingdom in 2008-09 and the £1.6 billion relative surplus in 2011-12. Jackie Baillie is absolutely right to say that it is important to look at the years when Scotland has had a stronger financial position than the rest of the United Kingdom; we should not concentrate just on the issues that the Labour Party tries to raise out of “Government Expenditure and Revenue Scotland” for 2012-13.

Ken Macintosh (Eastwood) (Lab)

What does Mr Swinney mean when he uses the term “relative surplus”? Is he suggesting that we run a surplus, or do we actually run a deficit?

John Swinney (Scottish National Party, Perthshire North)

The term “relative surplus” is crystal clear. It means that we are in a stronger financial position than the rest of the United Kingdom in the years that we have mentioned. I would have thought that the meaning was crystal clear from what I said a moment ago. I said that there are some years when we have a stronger current budget balance than the United Kingdom as a whole and some years when we have a lower and weaker position. That is a simple proposition for the Labour Party to understand.

Ken Macintosh

On a point of order, Presiding Officer. [Interruption.]

The Deputy Presiding Officer

Come to the point, please.

Ken Macintosh

Thank you, Presiding Officer. In order for you to ensure that nobody inadvertently misleads the chamber, I say that the word “surplus” clearly implies that Scotland is—

Members: Relative surplus.

The Deputy Presiding Officer

Order. Let Mr Macintosh conclude, please.

Ken Macintosh

The term “surplus” clearly implies that we are not borrowing more than we spend, but that is not the case. We are running a deficit, so the term “relative surplus” means a deficit.

The Deputy Presiding Officer

That is not a point of order; indeed, it is spurious. Do continue, Mr Swinney.

John Swinney (Scottish National Party, Perthshire North)

We believe that the strong track record of the Scottish Government’s economic policy making is proof that we are best placed to make the key decisions about Scotland’s economic and social future. I believe that Scotland should be fully responsible for raising and spending all its own resources. That will ensure that we are better able to respond to the challenges and opportunities that Scotland faces.

Our policy is for the people of Scotland, not Westminster, to take the decisions on the issues that matter the most. The majority of people in Scotland support that. The powers involved include those over employers’ and employees’ national insurance contributions; those over employment rights, including the national minimum wage; full powers over working-age benefits and employment policy; increased powers over aspects of immigration, such as post-study work visas; and powers over business taxes to enable us to create a stronger economic platform and to create jobs and tackle inequality.

Exercising those powers over time will enable the Scottish Government to take actions to improve our economy’s performance, to improve the public finances and to reinvest the proceeds of faster economic growth in our public services.

Gavin Brown (Conservative, Lothian)

Does Mr Swinney accept that, in the short term, we would be financially worse off under full fiscal autonomy?

John Swinney (Scottish National Party, Perthshire North)

I have set out the fact that, by exercising responsibilities in accordance with the needs and priorities of the people of Scotland, we have the ability to achieve some of the improvements in economic performance that I have set out, such as increasing exports by 50 per cent or strengthening our productivity so that we can improve the Scottish economy’s performance and generate the revenues that will enable the people of Scotland to prosper as a consequence.

At the heart of the debate is an issue that Jackie Baillie raised—the financial context in which we take our decisions. Of course, the financial context in which we have taken our decisions is one in which the United Kingdom has increased its debt over the past five years by £600 billion.

Jackie Baillie has argued that, if a Labour Government is elected on 7 May, the issues of austerity will somehow not be on the agenda. She must explain to Parliament why on earth Labour MPs voted for the charter for budget responsibility, thereby committing the Labour Party to £30 billion-worth of cuts over the first two years of the next Parliament. Why on earth did Labour MPs vote for that charter when, in doing so, they were committing their party to such a significant reduction in public expenditure?

Jackie Baillie (Labour, Dumbarton)

We voted to balance the budget; we did not vote for Tory austerity. [Interruption.]

The Deputy Presiding Officer

Order.

Jackie Baillie (Labour, Dumbarton)

It is interesting that SNP back benchers are laughing, but John Swinney cares about balancing the budget.

At today’s meeting of the Finance Committee, we heard from the IFS that the spending plans of Labour and the SNP are similar, so if, as John Swinney accuses us of doing, we are following Tory austerity, his party is, too.

The Deputy Presiding Officer

You are in your final minute, Mr Swinney.

John Swinney (Scottish National Party, Perthshire North)

I have two points to make in response to that. The Labour Party has committed itself to sticking with the Tory spending targets, which will mean £30 billion of spending cuts. Jackie Baillie might dress that up as something nice such as balancing the budget, but it is balancing the budget by imposing £30 billion of cuts on the most vulnerable in society in Scotland.

Jackie Baillie (Labour, Dumbarton)

Will the cabinet secretary give way?

John Swinney (Scottish National Party, Perthshire North)

No—I must conclude.

Given the point that Jackie Baillie made about the evidence that the IFS gave to the Finance Committee this morning, is she now committing the Labour Party to supporting the First Minister’s argument that we should boost public expenditure by £180 billion? If that is the case, it will be news to Ed Balls, because he is arguing the diametric opposite of that in the House of Commons.

I am surprised by the Labour Party’s position in today’s debate. After the referendum and its two-year partnership with the Tories to talk Scotland down, the Labour Party has tried to suggest over the past couple of months that it has somehow become all supportive of Scotland. Today, we have another example of the Labour Party talking Scotland down, and the people of Scotland will see right through it.

I move amendment S4M-12591.3, to leave out from “that full” to end and insert:

“Scotland should have the powers that it needs to create a jobs-rich, more equal and more locally-based economy; further believes that this is key to reducing inequality and promoting a sustainable future; agrees that the UK Government’s fiscal austerity programme is having a disproportionate impact on the poorest in society and will reduce public spending to its lowest level since the 1930s, and calls on the UK Government to end the unfair cuts to public spending and invest to protect public services.”

Gavin Brown (Conservative, Lothian)

It is probably worth having a dispassionate and objective look at the actual figures that were published today, rather than putting one particular spin on them. Revenue was just shy of £54 billion, expenditure was just over £66 billion, and there was a net fiscal-balance deficit of £12.4 billion. That is a substantial deficit, and the reality is that it is likely to be worse in the next financial year, because the figures that were published today take absolutely no account of the drop in the price of oil, which happened some six months after the period to which the figures that I cited relate.

Even without the drop in the oil price, we are looking at a deficit of £12.4 billion, which means that Scotland has a deficit of 8.1 per cent, compared with the UK’s deficit of 5.6 per cent. That is quite a substantial difference. If we were to go it alone under full fiscal autonomy, that would be an enormous gap to fill. That is why I asked the Deputy First Minister whether, based on those figures, we would be better off or worse off in the short term under full fiscal autonomy. His own figures—the figures that I cited are Scottish Government figures; they do not come from the UK Government or the Conservative Party—show that Scotland had a substantially higher deficit than the UK had last year, and that the situation will probably be worse in the next financial year, although we do not yet know for sure what the figures will be. It is pretty clear that we would be worse off in the short term, but the Scottish Government refuses to acknowledge that—it refuses to look at the figures and it ignores anything that does not suit its purposes.

The title of the document that contains the figures is “Government Expenditure and Revenue Scotland 2013-14”, but in the Government’s two-page press release and the 10-minute speech from the Deputy First Minister of this country, we have not had a single mention of the word “expenditure”. It is staggering that he has not mentioned it. There is not a chief executive in this country or any other who would stand up to present their annual accounts and focus only on revenues, completely ignoring expenditure and pretending that it does not exist. We deserve better in this Parliament and in this country.

John Swinney (Scottish National Party, Perthshire North)

Will Gavin Brown give way?

Gavin Brown (Conservative, Lothian)

Perhaps the cabinet secretary will put things right now, and acknowledge the expenditure figures.

John Swinney (Scottish National Party, Perthshire North)

I do not think that Mr Brown can have listened to what I said about the fact that in some years we have a stronger financial position and in other years we have a weaker one. That was recognition of the fact that this year our financial position is weaker than it has been in previous years, when it was stronger. For completeness, perhaps Mr Brown will accept that point.

Gavin Brown (Conservative, Lothian)

The cabinet secretary ignored the questions about expenditure and refused to acknowledge that we would have been worse off according to his own figures. Going back and dancing on the head of a pin, and saying, “Over the course of the past six years, we might have been better off in two of them” really does not cut it. Unless he is going to invent some kind of time machine, it is absolutely irrelevant that we would have been better off in two of the past six years.

The cabinet secretary was right to say that we should not focus just on one year; that is a perfectly fair and valid point to make. However, it is important that we look at the most recent figures and at the most likely projected figures, because if we were to go for full fiscal autonomy as he and the rest of his party now want, it would happen in the future. The projections of what would happen count more than what would have happened had we done it 20, 30 or even 40 years ago.

Mike MacKenzie (Scottish National Party, Highlands and Islands)

Even if it was possible to project forward for all time to come, and even if we paint the picture of doom that Mr Brown suggests, surely he will agree that that is an absolutely shocking legacy of 300 years of Westminster rule.

Gavin Brown (Conservative, Lothian)

I was speaking to one of Mr MacKenzie’s colleagues, who said, “Unfortunately, Mike MacKenzie sometimes leads with his chin when he intervenes.” That was a perfect example. We are not asking for projections for the rest of time. We would have been happy with short and medium-term projections; we would have been happy with the projections that any other Government would have to do if it was suggesting such a policy.

We believe that the situation is going to get more difficult because of the two underlying trends that were outlined by just about every economist in the run-up to the referendum: that cost pressures will increase with the demographic challenge of an ageing population, which is set to accelerate faster in Scotland than in the rest of the UK, coupled with the fact that revenues are likely to drop. In particular, oil revenues are volatile and will diminish over time.

That is the reason for our amendment. In recent years, the Government has been happy to publish its projections. We have had bulletins, a balance sheet and the “Outlook for Scotland’s Public Finances and the Opportunities of Independence” report. We are saying that the Government should publish that again, because two things have changed: the short and long-term tax takes for oil and gas have changed, and we now have the Government pushing full fiscal autonomy instead of independence. Let us see the figures; let the Government demonstrate to us how much better off it thinks we will be, and then the country as a whole will have an opportunity to look at the figures and make its own judgment about who is right.

I move amendment S4M-12591.2, to insert at end:

“, and further calls on the Scottish Government to publish an updated Outlook for Scotland’s Public Finances to take into account changes to the projected public finances since the original publication in May 2014 and also to reflect the current Scottish Government policy of seeking full fiscal autonomy”.

Willie Rennie (Liberal Democrat, Mid Scotland and Fife)

I am grateful to the Labour Party for bringing this debate to the chamber, because I suspect that if it had been left in the hands of John Swinney and his Government, it would not be happening; it would certainly not be happening on the day when we get the latest GERS figures. Just a cursory glance at them indicates that the Scottish Government would be reluctant to have this debate, because it has to face up to the reality that there is a massive hole in the public finances. It is much bigger than in previous years, and much worse is certainly to come in future years. As Jackie Baillie rightly said, the worst is yet to come because we have not seen the full effects of the fall in the oil price.

Next year’s figures will be even higher. It will be interesting to see whether John Swinney agrees to a debate next year on the same subject. I suspect that, if we had had a yes vote last September, the atmosphere in this chamber would be quite different and this would not be an academic discussion about whether the figures are going up one year or down the next. Some of what John Swinney says is right: in some years, the figures are better. However, with a yes vote, we would now be in blind panic about how we were going to cope with the worsening economic and financial figures in an independent Scotland. Therefore, we are fortunate to be in a position to be able to discuss the issue academically. We should count our lucky stars that people did not vote for independence and that we are not in a blind panic today.

During the referendum, the nationalists repeatedly told us that the choice was between two futures—the future that we would get if only we followed the Scottish National Party’s advice, or the other future in which the unionist parties were determined to inflict an evil destiny on Scotland. Let us analyse those two futures. The SNP said that the UK Government’s economic plan would fail, unemployment would rise, gross domestic product would stagnate and employment would fall. However, thanks to that plan, the opposite is the case. We have falling unemployment, record-high employment and a rising GDP that is among the best in the G7. That would not be the case had we followed the SNP’s advice.

The nationalists said that we were on the verge of a second oil boom, with a blossoming oil fund—no one mentions the oil fund any more, by the way—more jobs and ever-increasing tax receipts. However, we face a low oil price—it is half what the SNP confidently predicted it would be—jobs have been slashed and tax revenues have plummeted way below the GERS figures. If the SNP had had its way, schools, universities and hospitals would soon be feeling the cold draft of its policy.

People are rightly critical of Labour’s economic competence, but the SNP wants to borrow even more than Labour is planning to borrow. That would result in higher debt charges. Let us examine the First Minister’s claim that debt will fall as a percentage of GDP, which she made in her grand speech at a university in London but has not mentioned ever since. This week, the Treasury has shown in its analysis that if we followed SNP policy debt would rise—not fall—as a percentage of GDP.

I will take an intervention from John Swinney if he wants to back up what Nicola Sturgeon said, because although the Government has been asked repeatedly to back up her claims, it has failed to do so.

John Swinney (Scottish National Party, Perthshire North)

I certainly will. The Treasury took a different approach to how the Scottish Government set out the figures. The Treasury put the increased borrowing into the financial year in which it was procured while the Scottish Government put the borrowing into the start of the following financial year. That is the difference between the two calculations.

Mr Rennie is quite wrong to say that the analysis that was published by the Treasury on Monday does not show the debt to GDP ratio falling by the end of the next session of Parliament, because that is exactly what it has confirmed.

Willie Rennie (Liberal Democrat, Mid Scotland and Fife)

Nicola Sturgeon said that the debt to GDP ratio would fall in every single year. That is not the case. Is John Swinney disputing that?

John Swinney (Scottish National Party, Perthshire North)

The exact point of explanation was in the first part of my response; we used a different method and showed exactly why that was the case. However, even using the Treasury’s method, the debt to GDP ratio would fall by the end of the next session of Parliament.

Willie Rennie (Liberal Democrat, Mid Scotland and Fife)

John Swinney is not disagreeing with my central claim; he is not backing up what Nicola Sturgeon said in London. The SNP wants to borrow more than Labour is planning to borrow. It is economically incredible that the SNP is proposing that. On the back of being wrong about the oil boom and the UK Government’s economic performance, the SNP, on the back of our children’s future, is encouraging this country to borrow £180 billion more. That is not economic competence: it is economic irresponsibility.

I move amendment S4M-12591, to insert at end:

“, and believes that the transfer of significant new powers to the Parliament under the Smith Commission agreement will provide real opportunities for the Scottish business community to work with policy makers to boost growth in Scotland”.

Chic Brodie (Scottish National Party, South Scotland)

I welcome the debate today—although why Labour has entitled it “Supporting Scotland’s Economy” when it has been lambasting Scotland’s economy defeats me.

Labour has jumped on the GERS figures that were published today, but experience tells me that it is often better to read and understand the background to the figures. It also tells me to look at trends and outcomes and not to be obsessed with one set of figures in a rolling economy. On that basis, I cannot hide the fact that I welcome that our deficit has fallen by £2 billion compared to an apparently immovable UK deficit of £97.2 billion, and that the tax take in Scotland was £400 per head higher than that in the rest of the UK.

I am sure that we will be able to have much more meaningful exchanges when everyone has better analysed the trends and background. I am also sure that the trends will show that, despite Mr Rennie’s gloom and doom, we will be in a position to support public services.

Bruce Crawford (Scottish National Party, Stirling)

Will Chic Brodie give way?

Chic Brodie (Scottish National Party, South Scotland)

I will not just now; I am sorry. [Laughter.] I am making a point.

It appears that the branch mentality still pervades the Labour Party, not only in relation to its London office but in relation to the UK Government, regardless of which party is in power. When any head office or headquarters is not organised or competent, or when it fails, the first thing to get hit is the branch. As long as the London Government exercises power and authority over swathes of Scotland’s financial management, and as long as the London parties, especially Labour, exercise financial and political control over their branches, it will always be thus. We cannot divorce meaningful political power from economic power.

Happily, we all know where political power in Scotland will ultimately come to rest.

Murdo Fraser (Conservative, Mid Scotland and Fife)

Will Chic Brodie give way?

Chic Brodie (Scottish National Party, South Scotland)

Yes.

Murdo Fraser (Conservative, Mid Scotland and Fife)

I am grateful to succeed where Bruce Crawford failed. Is Mr Brodie saying that Mr Swinney is George Osborne’s puppet?

Chic Brodie (Scottish National Party, South Scotland)

Sometimes it is better to sit still and not say anything in case it sounds silly, than it is to stand and confirm it. [Laughter.]

The Deputy Presiding Officer

That is enough.

Chic Brodie (Scottish National Party, South Scotland)

Even Lord Barnett, the begetter of the formula, said that keeping his formula in the event of Scotland getting more economic powers would be a “terrible mistake”. More recently, Lord McConnell said that the Barnett formula would be “diminished” in the event of a no vote because the funding arrangement would be irrevocably changed by new tax powers, even limited ones, coming to Scotland.

The branch is definitely not listening to the people. Poll after poll shows that the majority of Scotland’s people are seeking change and for the responsibility for all key tax and spending decisions to lie here. Of course, we cannot fulfil those aspirations while we have a so-called headquarters at Westminster. Do not believe the pressure of the economic forecasts, which have been subsidised by six Office for Budget Responsibility statements for the autumn statement, which hide the fact that we have a £1.57 trillion debt that is garnering almost £5 billion in annual interest. I regret that Mr Rennie would not acknowledge that today.

We are losing out on billions of pounds of support for public services including the NHS and schools, but not at our own hand. No one individual, no family and even no branch can be economically stable or successful while some other body controls 70 per cent of the tax-raising powers and 85 per cent of welfare expenditure. We cannot tackle inequality properly, fully challenge employability and training, improve working conditions, or address in-work poverty without faster and more local decision making for the finances of the nation.

Drew Smith (Labour, Glasgow)

Will Chic Brodie take an intervention?

Chic Brodie (Scottish National Party, South Scotland)

No.

Until we have that full autonomy and right, and while we fall short of full fiscal autonomy and grown-up responsibility—this Parliament is now grown up—the Barnett formula will be retained and adjusted appropriately to the actual degree of fiscal responsibility, but at another’s hand.

The Scottish Affairs Committee’s recent claim that

“without the protection of the wider and more diverse UK economy”,

full fiscal autonomy would be “disastrous”, is fanciful. It would do better to look at the risk to the UK economy and the City of London from laid-off eurozone and Greek debts and from further capital spend on defence—items such as Trident. Those are real risks to Westminster and, regrettably, to us, in the current environment. We would like a vibrant and competitive neighbour standing on its own two feet while we do the same.

We could boost GDP, we can and will increase exports and we will increase employment when we have the capacity to do so. That is how we will improve our NHS, our schools, our public services, our wealth and our resources.

Two weeks ago Labour had no economic strategy. Yesterday it had no plan for oil and gas and it today it has no fiscal or monetary strategy. Poor Scottish Labour: a branch.

Iain Gray (Labour, East Lothian)

J K Galbraith once said:

“Economics is a subject profoundly conducive to cliché”.

When it comes to our economy, there is no greater cliché than to say that our greatest resource is our people, but that is true, and it is a truth that is universally acknowledged. The Scottish Government certainly agrees; in her introduction to the economic strategy the First Minister says:

“Our people are creative, ambitious and resilient ... We will continue to build on these strengths”.

It is a truth acknowledged across the political divide. When Carly Fiorina, darling of the US Republican right, was chief executive of Hewlett-Packard, she said:

“Keep your tax incentives and highway interchanges; we will go where the highly skilled people are.”

Where Nicola Sturgeon and Carly Fiorina might differ is in the First Minister’s assertion that the issue is not just about increasing competitiveness to drive economic growth but also about tackling inequality. I am with the First Minister there. Every pupil, student or worker whom we fail and leave behind is not just a personal scandal but an economic loss. The Government economic strategy recognises that and notes successes of which we should be rightly proud. We have the curriculum for excellence, more than 45 per cent of the workforce has a higher or further education qualification, four of our universities are in the top 200 in the world, we have world-class research and we have 25,000 apprenticeships.

However, the economic strategy ignores some underlying failures. Our schools have lost more than 4,000 teachers since 2007. Teaching unions and headteachers warn that the profession is at breaking point, and some have even talked of imminent catastrophe. In some subjects and some places there are no teachers to be had, and pupils face being sent home. This week, we discovered from a Daily Record investigation that, in some parts of Scotland, we spend as little as 12p per pupil per year on textbooks.

Colleges have suffered the most—a real-terms cut in funding of £61 million and 140,000 fewer students. Although tuition in our universities is free, the support that we offer students from low-income families is less that than that offered anywhere else in the UK, and possibly worse than it is anywhere else in western Europe.

Meanwhile, the Government has just slashed support for the world-class research in our universities that it celebrates, by many millions: £8 million in the University of Edinburgh, £2.5 million in the University of Glasgow and £1.5 million at the University of Aberdeen. It is often exactly the skills that we need for the future that are suffering most.

I believe that we can address all of that. If we believe in the capacity of our people and we invest in their skills and education, there is nothing that this country cannot do.

John Mason (Scottish National Party, Glasgow Shettleston)

Iain Gray seems to want more money for both universities and colleges. Where does he suggest that money should come from? Perhaps from a cut to the NHS?

Iain Gray (Labour, East Lothian)

If Mr Mason had been following the Scottish Labour conference at the weekend, he would have seen that we suggested increasing bursaries using resources that would flow through the Barnett formula from decisions on tuition fees in England.

Chic Brodie talked about supporting the economy. Investing in our young people and the skills of our workforce, and not simply using warm words in the chamber, is how we support the economy. To do that, we must have the resources to make those investments.

Today’s GERS figures make it clear that the investment that we need would be utterly jeopardised by the Scottish Government’s core demand for fiscal autonomy. Swapping the Barnett formula for volatile oil revenues would leave a £4 billion hole in our public finances. Indeed, cuts of only tens of millions of pounds to university research and to colleges would pale into insignificance, and the loss of only 4,000 teacher posts would look like halcyon days. That £4 billion is our entire school budget. It is four times what we invest in higher education institutions and eight times the colleges budget.

To risk the investments that we know we need in our people and our future for a purely ideological end is not standing up for Scotland; it is letting Scotland down. Promising unprecedented hypothetical growth or spinning counterfactual stories based on investments that might have happened some years ago, or renaming fiscal autonomy as full revenue retention, does not change the figures. They are stark, and they will be worse next year because the current figures predate the collapse in the oil price.

Members should make no mistake: GERS does not speak of dependence. The figures describe the advantages of, and our contribution to, a partnership whereby Scotland can manage volatility in the economy and at the same time invest in our economic future. That is the lesson of the run of figures that Mr Swinney has described over a number of years.

It is that partnership that has allowed us to weather the storm of the banking crisis, not painlessly but able to find our way through—

Elaine Smith (Labour, Coatbridge and Chryston)

The member should draw to a close, please.

Iain Gray (Labour, East Lothian)

It is that partnership that means that we can face the downturn in the oil and gas sector. It is a mature, modern, developed, devolved and increasingly decentralised economic partnership, in which Scotland is big enough and smart enough to thrive and to prosper. Why on earth would we want to jeopardise that?

The Deputy Presiding Officer

I am afraid that we are very short of time—members cannot go over their six minutes.

Stuart McMillan (Scottish National Party, West Scotland)

I am happy to speak in another economy debate. The debate is very timely. On the day we learn that Scotland has yet again contributed more in taxation per head than elsewhere, Labour once again brings to the chamber a motion talking Scotland down. [Interruption.] Jackie Baillie and I disagree on many things, and we regularly do so in the pages of newspapers in the Dumbarton area. There is one area on which we agree, to which I will return later.

Today’s GERS figures highlight that Scotland’s tax take for 2013-14 was £400 per head higher than that in the rest of the UK.

Jackie Baillie (Labour, Dumbarton)

Will the member take an intervention?

Stuart McMillan (Scottish National Party, West Scotland)

I will continue first. With tax revenues in Scotland higher per person than those in the rest of the UK in each of the past 34 years, and with the additional revenue in the past five years alone totalling £4,100 per person, it is obvious that Scotland has the means and ability to progress but lacks the powers to do so.

I will take one intervention.

Jackie Baillie (Labour, Dumbarton)

Will Stuart McMillan accept that, although he describes £400 as being the additional tax revenue per head from Scotland, expenditure is £1,200 higher per head in Scotland than in the rest of the United Kingdom, and that we therefore have a deficit of £800 per person?

Stuart McMillan (Scottish National Party, West Scotland)

I accept that Scotland has a broad economy—[Interruption.]

The Deputy Presiding Officer

Order, please.

Stuart McMillan (Scottish National Party, West Scotland)

I accept that Scotland has a broad economy. There will be occasions on which Scotland’s contribution will be larger, and others on which it will be smaller. Unfortunately, that is one of the problems that we face under the current constitutional arrangements.

The Scottish economy is broad and has inherent strengths, but it lacks powers, and that is certainly holding Scotland back.

Scotland’s economy has some positive stories to tell and much of that is down to the hard work of this SNP Government. Scotland has higher revenue contributions than the UK as a whole, higher employment, lower unemployment and an economy that is growing at a faster rate than the UK as a whole.

Jackie Baillie spoke earlier about the deficit and asked me a question about it a moment ago. If we listen to her arguments, surely—

Iain Gray (Labour, East Lothian)

Will the member give way?

Stuart McMillan (Scottish National Party, West Scotland)

I have already taken one intervention. I am not taking any more.

Surely, if we listen to those arguments, we will see that this Parliament should be independent, never mind having fiscal autonomy. Jackie Baillie’s arguments highlight that the union is not working.

We have the capacity and the resources to grow our economy, to address inequalities, to grow small businesses and to put more people back into work. However, to do that, we need more economic powers and the ability to protect Scotland against the anticipated £14.5 billion-worth of cuts that Westminster plans over the course of the next Parliament.

Willie Rennie and Jackie Baillie spoke about more powers and touched on the Smith proposals. I recommend to both Willie Rennie and Jackie Baillie that they should read the Official Reports of the Devolution (Further Powers) Committee meetings over the past few weeks. We have had discussions about welfare and the welfare powers that are to come to this Parliament, about borrowing powers and about the Crown Estate. After reading the Official Reports of those meetings, I am sure that Willie Rennie and Jackie Baillie would appreciate that the proposed powers are a bit of a dog’s breakfast—not so much the Smith recommendations as the draft clauses.

Gavin Brown also asked about the position on fiscal autonomy. That question is very much hypothetical because, first, we do not have the powers; secondly, the powers are not under offer under Smith; and, thirdly, David Cameron—Mr Brown’s own Prime Minister—has not ruled out fiscal autonomy coming to this Parliament.

Murdo Fraser is sitting there muttering something to Gavin Brown—no doubt sweet nothings—

Murdo Fraser (Conservative, Mid Scotland and Fife)

Eh?

The Deputy Presiding Officer

Order, please.

Stuart McMillan (Scottish National Party, West Scotland)

Mr Fraser, if you go and check that out, you will see that the Prime Minister has not ruled out that particular offering.

Murdo Fraser (Conservative, Mid Scotland and Fife)

When did he say that?

The Deputy Presiding Officer

Mr McMillan, speak through the chair, please.

Stuart McMillan (Scottish National Party, West Scotland)

Sorry, Presiding Officer. If Mr Fraser does not like that notion, I suggest that he takes it up with his Prime Minister.

Jackie Baillie’s motion highlights the Barnett formula. Surely the no-detriment principle in Smith’s proposals ensures that Scotland’s economy will not be adversely affected due to the Westminster policies in the next parliamentary session.

Jackie Baillie (Labour, Dumbarton)

Will the member take an intervention?

Stuart McMillan (Scottish National Party, West Scotland)

Sorry, I am in the last 30 seconds of my speech.

The Deputy Presiding Officer

The member is in his last 30 seconds.

Stuart McMillan (Scottish National Party, West Scotland)

My final point is one that Jackie Baillie and I can agree on. It is about tourism—[Interruption.]

Obviously, Jackie Baillie does not appreciate my point, but it is very close to her constituency. The first marine tourism strategy was published last week. I accept that it has a small part to play in helping the Scottish economy but—

The Deputy Presiding Officer

You must draw to a close, please.

Stuart McMillan (Scottish National Party, West Scotland)

—if we consider John Swinney’s amendment in relation to the locally based economy, we see that marine tourism has a huge part to play in areas such as the Dumbarton constituency in particular.

Neil Findlay (Labour, Lothian)

In this Parliament and across the political classes, we argue about GDP, GERS figures, inflation, and percentages of this and percentages of that. Statistics are of course the meat and drink of politicians, but it is what happens behind those statistics that matters more. It is what is happening in the real world to our communities, our families, our friends and the people we are sent here to represent that matters the most.

I will read out two sobering passages from a group of young people who recently came together to reflect on their lives in their community. They said that, in their area, they see towns and villages with multiple issues affecting the quality of life for people living there but with

“poverty as the root cause”.

They see community workers feeling helpless as they stand watching humiliated, once-proud parents in growing numbers forced to use food banks to feed their families, and communities where malnutrition is increasing, as young mums choose to feed their children before themselves; where local services and infrastructure are crumbling; where poor uninsulated housing is common and where once-thriving social housing schemes are in dire need of investment.

They spoke of how young people are ostracised and moved on by the police but with nowhere and no recreational services to go to. The minimal employment opportunities available are characterised by low pay, zero-hours contracts and insecurity. Welfare cuts have seen the confidence of young people so affected by constant rejection from jobs that do not exist that they give up looking and are sanctioned as a result. Stress and mental illness are “going through the roof”, but mental health service provision for young people is abysmal and many wait two years for a psychiatric appointment. The consequence is that

“people have a greyness about them … a deflated-ness … a hopelessness and helplessness”.

When I read those two passages, they made me extremely angry and what is most shocking is that they are the words of the young people describing themselves and their lives; they are not my words. We may talk about statistics, but that is the reality of life in many working-class areas in Scotland. My worry is that things will get even worse if we sleepwalk into another Tory Government or end the Barnett formula’s redistribution.

What would another £70 billion of cuts mean for our housing budget when we have a social housing crisis? What would it mean alongside the Scottish Government’s underfunding of local government services? What would it mean for our social care sector? Already, one of the biggest crises is in that sector. What about youth services, community health or addiction services or social work? I shudder to think what it would mean for the cohesiveness of our society and the wellbeing of our communities.

John Mason (Scottish National Party, Glasgow Shettleston)

Neil Findlay is obviously not happy about the idea of Labour doing a deal with the Conservatives in the event of a hung Parliament at Westminster, so would he prefer to have a deal with the SNP in such a situation?

Neil Findlay (Labour, Lothian)

I would prefer Mr Mason not to talk utter tripe first of all. That would be a start.

The Deputy Presiding Officer

Mr Findlay, watch your language, please.

Neil Findlay (Labour, Lothian)

I am trying to raise a serious point about the conditions of people in their community and we get rubbish like that.

This is not a game. People are dying early through poverty 25 to 30 years before their time. That is no accident; it is a direct result of a system that is supposed to create poverty and inequality via a low-tax, privatised, small-state approach. The question for us is whether we are willing to do anything about it.

Are we willing to say to those who can pay more that they will? A 50p tax rate would be a start.

Are we willing to say to the low-paid young person on a zero-hours contract that things will change for the better and that we will put an end to zero-hours abuses, increase the minimum wage, extend the living wage and give a guarantee to young people who are out of a job?

Are we willing to say to the big tax evaders that they must help to finance the services from which they benefit? A clampdown on tax avoidance would certainly help.

Are we willing to target resources to needy areas? A targeted school attainment plan would begin that.

Are we willing to invest in our young people? Reinstating college bursaries, having no tuition fees and providing a £1,600 training allocation for 18 and 19-year-olds would make a real difference.

Those things can be achieved only because, as part of a UK-wide economic system, we benefit from UK-wide redistribution. The Barnett formula is a good thing. Where is the logic in Scotland losing out on over £4 billion for our public services, which need that investment desperately? I simply do not understand.

Full fiscal autonomy would mean that we slip deeper and deeper into austerity. Surely it is better that we continue to gain from a higher share of public spending, benefit from a share of a tax on UK bankers’ bonuses to fund jobs for young people and benefit from taxes on the mansions of wealthy people to fund our NHS. Surely it is better that we do not cut our nose off to spite our face.

We owe it to the young people I spoke about to offer practical policies that will materially improve their lives. Cutting public spending by £4 billion will not do that.

Gil Paterson (Scottish National Party, Clydebank and Milngavie)

There are so many things in the Labour Party motion that are questionable that it is difficult to make up one’s mind just where to start. However, the overall comment that best describes its major message is clear. It is another talking-down-Scotland exercise by Labour—a rubbishing of Scotland’s achievements and a distortion of facts that is matched only by what we saw during the Scottish independence referendum. If its view were true—which it is not—Labour should present ideas in the motion about how to put the situation right. However, rather than doing that, it proposes doing nothing more than continuing to live off the crumbs from a supposed rich man’s table.

Of course, when we examine Scotland’s prospects and its performance over the recent past, we will come to a view that is contrary to Labour’s claims. In each and every one of the past 34 years, Scotland has raised more tax revenues per head of population than the rest of the UK has raised. Rather than Scotland being a basket case that needs to be propped up by the rest of the UK, the truth is the exact opposite, with the fact being that Scotland is subsidising the rest of the UK—something that we would never hear from any unionist politician in Scotland.

Of course, the perpetual untruth about Scotland being subsidised gains common currency across the UK, but in particular in England. That slur of a myth is fed by unionist politicians in Scotland who are prepared to constantly rubbish the prospects of the people of Scotland and even their own families for a purpose that I find difficult to understand. No businessman or businesswoman would be so stupid as to write and publish a motion undermining their own business, with the only benefactors being their company’s competitors.

On another point, only Labour could possibly call in a motion for the Scottish Government to retain the Barnett formula but forget to mention that the Scottish Government has never asked for the Barnett formula to be scrapped. In fact, the Scottish Government has time after time repeated its call for the Barnett formula to be retained. However, who has argued for it to be scrapped—indeed even demanded that it be scrapped? You couldn’t make it up: of course, it is Labour. Yes, in July 2010, Labour’s First Minister of Wales called for the formula to be scrapped, something that would steal £4 billion from the Scottish budget overnight. If that is not enough, I point out that Labour’s shadow chancellor, Ed Balls, when referring to the Barnett formula, stated:

“It was never intended to be long term. We are getting to the point where it needs to be looked at again … I have read the Holtham report and I understand the arguments.”

What a threat that is.

However, despite unionist Labour’s worst efforts to damage Scotland at every turn, we are not only still standing but marching on. Under the Scottish Government, with the limited powers that it has at its disposal, we have some of the best performance indicators in the entire UK. Scotland now has the highest employment rate among the four countries of the UK, which is a strong foundation to build on as the Scottish Government looks to achieve a more productive, more cohesive and fairer Scotland through its economic strategy. Between 2007 and 2013, our country moved from fourth to third in terms of output per head within the UK, with only London and the south-east of England ahead of us. During the same period, the value of our international exports increased by around 40 per cent, which is extremely positive.

While the value of our exports has increased, we have also become an attractive prospect for foreign direct investment, with the Ernst & Young attractiveness survey finding that, in each year since 2007, Scotland was ranked in the top two UK regions outside of London for investment. Just think what we could do with all the powers of a normal country compared to what we are going to be given by Westminster.

I feel that I will need to retract that part of my speech because, truthfully, I have no true idea of just what the Scottish Parliament will get out of Westminster. It is an ever-diminishing feast, like in “Alice in Wonderland” or “Through the Looking-Glass”. However, sadly, one thing is quite clear when it comes to what Scotland will get from Westminster. As long as the UK Government continues with its reckless austerity agenda, with the support of the Labour Party, it will be our most vulnerable people who will bear the brunt of the cuts. That issue is missing from the Labour Party’s motion—I wonder why.

I commend John Swinney’s amendment.

Murdo Fraser (Conservative, Mid Scotland and Fife)

In yesterday’s debate on oil and gas, I was accused by Nigel Don—who I think has just left the chamber—of rerunning the independence debate. This afternoon’s debate is more likely to be a rerun of the independence debate, although we have moved on a little, because we are now talking less about independence and more about full fiscal autonomy.

I have made the point in previous debates that the language can get confused when we are talking about the constitution and when terms such as “fiscal autonomy”, “devo max” and “federalism” get bandied around without anybody being terribly precise about what they mean. I think that we understand what the SNP means, though, by “full fiscal autonomy”. It means no sharing of resource. It means that all taxes that are raised in Scotland are retained in Scotland. We bear responsibility for all of our own spending, and we pay a sum to Westminster for any reserved powers, such as defence or foreign affairs or whatever there might be under the SNP’s preferred model.

I am not aware of anywhere in the world—least of all within a federal state—that operates on that particular basis, but no doubt we will hear from SNP members if they can point us to models where it is done.

Jackie Baillie was talking about the GERS figures. We have debated those in the chamber many times in previous years; I will go over briefly the history of some of those figures, because I think that it is important to set today’s figures in context.

Two years ago at about this time, we had the publication of the 2011-12 figures, which showed that Scotland had a fiscal deficit of £5.1 billion, which was 3.4 per cent of GDP. That figure was relatively better than the figure for the UK as a whole. Those of us who were around at that time will remember that those figures were trumpeted by the SNP. We were told that they showed us that Scotland paid in more than we got out of the UK. Of course they did not tell us that; what they did say was that our deficit was relatively smaller. Those figures were used throughout the independence campaign. They were put in SNP and Yes Scotland leaflets that were pushed through people’s letterboxes and which said that the fact that we paid in more than we got out was the reason to vote for independence.

A year ago at this time, the 2012-13 figures were published. They showed a deficit of £12 billion, which was relatively worse than the UK. At that stage the SNP narrative changed; it stopped talking about the last 12 months’ figures and started talking about the last five-year period. It said that we only had to look at the context of the last five years, and over that time we were relatively better off. Of course what we learned today is that the £12 billion figure was an understatement. The correct figure for 2012-13 was more than £2 billion higher than that; in fact it was £14.3 billion and therefore much worse than we had been led to believe at this time last year. That puts into context, again, the independence debate that we had in the run-up to last September.

Today we have the figures for 2013-14—a £12.4 billion deficit, which is 8.1 per cent of GDP, against a UK share of 5.6 per cent. In terms of its budget, that puts Scotland in the worst position of any European Union country except for Slovenia and Greece. It also means that if we went for full fiscal autonomy—which is what the SNP proposes—there would be an extra gap of £3.8 billion that we would have to fill. That would be either £3.8 billion in cuts to public services or an 8 per cent increase on the basic rate of income tax.

Let us not forget that these figures for 2013-14 are historical—they are for a period before the recent fall in oil prices. We can expect the figures for 2014-15 and onwards to be much worse.

The point is this: every time somebody from the SNP stands up in this chamber or anywhere else and attacks UK austerity or UK Government cuts, they will have to explain how much extra austerity or extra cuts would be required if we went down the route of full fiscal autonomy. That is exactly what is on offer on the basis of the figures.

Fortunately, we have an alternative, because we had the Smith commission proposals to give the Scottish Parliament proper financial accountability. I warmly suppose those proposals; I think that it is right that we are more accountable for the money that we raise. The crucial thing about the Smith commission proposals, though, is that we will retain that vital sharing of resource across the United Kingdom. That is a feature of federal systems across the world. They share resource, and the different parts of the federation pay in more in good times and draw out more in bad times. That is being better together; it is sharing resource.

We have two contrasting visions for Scotland. One is the SNP vision of full fiscal autonomy. What that means is absolutely clear today—a £3.8 billion cut in public spending or an 8p rise in income tax. We have heard from Mr Swinney and other SNP speakers about the fact that we pay £400 per head more in tax than the figure for the UK as a whole. However, they do not mention the other side of the equation, which is that spending is £1,200 per head higher. The last time that I checked, £1,200 was higher than £400.

The alternative is that we continue to share resource with the rest of the UK but with the ability to vary key taxes in Scotland to drive and grow our economy. Let us not forget that, as Willie Rennie pointed out, in the UK we are in the fastest-growing economy in Europe thanks to the current UK Government. Why cut ourselves off from that? The SNP amendment talks about austerity and public spending cuts. Any cuts today from Westminster are a shadow of what would happen under full fiscal autonomy, as today’s figures make clear. A vote for the SNP is a vote for swingeing additional cuts or swingeing tax rises.

John Mason (Scottish National Party, Glasgow Shettleston)

One of the key problems with the Labour motion and with much Labour thinking is the concentration on the short term and the failure to take a long-term view. Labour members look at the present position with lower oil prices and apparently forget the years of higher oil prices and that Scotland has regularly subsidised the rest of the UK. Labour members also refer to the wealth and resources of the UK but forget to mention its huge debt, which we are also forced to share. The last time that I checked, the UK debt was £1.377 trillion, which spread among 64 million people is something like £21,500 per head. Is that the sign of a successful economy or of a failed one? The answer seems clear to me.

We have had doom and gloom from Labour and Conservative members about how awful things are in Scotland. To be fair, Murdo Fraser’s tone was slightly more solemn; Labour members seem gleeful that Scotland is in a difficult position. Full fiscal autonomy would have meant building up an oil reserve in the good times, as independent and non-independent Governments have done. We often mention Norway, with a fund of $759 billion, but Alaska is not independent and still has a fund of $64 billion.

Hugh Henry (Labour, Renfrewshire South)

John Mason looks back and says what full fiscal autonomy would have meant as a result of an oil fund and other expenditure. I dispute what he says but, just giving him credit for a minute, what about looking forward? Can he give cast-iron guarantees on what the price of oil will be in the future and what the contribution from the rest of the UK will be to Scotland?

John Mason (Scottish National Party, Glasgow Shettleston)

I can certainly comment on our present position and the future. Clearly, we will not be independent in the short term—at least, not by Christmas. One of the key factors that is at play under the Scotland Act 2012 and the Smith commission proposals is that there should be no detriment. With land and buildings transaction tax, we have had a long debate about the fact that, if we take on that power, Westminster must not in any way be disadvantaged, right up to 2030. The logic is that, if we took on more powers, other than those in the Smith commission proposals, and headed towards full fiscal autonomy, there would again need to be no detriment. That is the agreement. If it is reckoned that Scotland is running a deficit, logically, according to that agreement, Westminster would have to compensate us for that for a certain number of years.

Again taking a long-term view—that is what I have been saying we should do—the relative loss of population in Scotland is another sign of the long-term failure of the UK economy and UK management. When we joined England, the population ratio was something like one to four, but it is now down to one to 10. Surely, that is a sign of failure in the UK. In the past few years, there has been growth in a number of ways, which is excellent, but the long-term trend has not been good.

It is incredibly difficult to grow an economy with a stagnant population. We have a whole range of skills shortages in Scotland, including those among NHS staff, in the North Sea and in power companies. We need more skilled people, and that has to come either from growth of our own population or through immigration.

The share of wealth and income is also important. Mr Findlay was talking about that. I do not know what Mr Don is going to talk about, but I suspect that “The Spirit Level” might appear in his speech—and I, too, think that it is an excellent book.

It seems clear that the whole economy does better if wealth and income are more equally shared. Just this morning at the Finance Committee, Paul Johnson of the IFS was asked whether it made any difference how wealth was shared through the economy. He confirmed that, generally speaking, giving more money to people at the lower end would give a short-term and immediate boost to the economy, as they would tend to spend it because they had to.

Growing the economy is an important part of the answer, but the way in which the success of the economy is shared out helps to decide whether that growth is sustainable.

Neil Findlay (Labour, Lothian)

Will Mr Mason take an intervention?

John Mason (Scottish National Party, Glasgow Shettleston)

No, I have taken one already.

Scotland’s economy has also been held back in tourism, food and drink. Unfortunately, all those sectors have been buried under the UK brand, which is generally not as high quality in those fields.

The UK has not done well in manufacturing in comparison with Germany. About 10 per cent of UK gross value added is in manufacturing, compared with Germany’s 22 per cent. Scotland’s figure is slightly better than that of the UK, at 12 per cent, but that is still not great. Admittedly, the figure for German manufacturing has also fallen since 1970, from about 33 per cent to 22 per cent today. In the same period, the figure for the UK has fallen from 28 per cent to 10 per cent, which is a much more dramatic fall.

We have lost out in our steel and car industries, and they have been lost under UK management. Despite that, other developed countries have been able to keep those industries.

I am about to run out of time, but I want to mention ownership. The UK has been very poor at keeping ownership either in the public sector or locally. There are so many examples, including the rail system, electricity and Royal Mail. How much better would it be for the Scottish economy if the South of Scotland Electricity Board had stayed in public ownership, or if Scottish Power had kept its headquarters in Glasgow? Those are top jobs that we have lost. What kind of country is this—in the UK—if we lose all those assets?

I will mention one more point about further devolution—on VAT. It is very important that we get a share of VAT all the way through the process and all the way along the chain, not just at the end at the point where the consumer spends the money. Otherwise, we could grow the economy but not get the VAT.

There are good things happening, but Scotland’s economy, as I have tried to argue, is being held back by London. It has been held back for 300 years, and we could do a lot better if we stood on our own two feet.

The Deputy Presiding Officer

I remind members that speeches should be six minutes.

Alex Rowley (Labour, Cowdenbeath)

I begin by quoting a statement issued by the STUC regarding the GERS report:

“Today’s report is a sobering reminder of some of the risks of full fiscal autonomy for Scotland. The STUC has consistently argued that whilst Scotland’s funding settlement with the UK is entirely fair in the context of its historic and anticipated fiscal contribution, there are real risks associated with the volatile nature of oil revenues. It is for this reason that we argued for a combination of increased tax devolution and a continuing block grant as the best mechanism for secure and predictable funding for Scottish public services.”

I do not think that anybody would accuse the STUC of trying to talk down Scotland; it simply points to the facts. It is easy simply to retort, every time the facts do not suit the political argument being made, that people are talking down Scotland. I would certainly never dream of talking down Scotland, and I would always work to get what is in the best interests of Scotland, but the fact is that today’s report confirms that the value of the Barnett and other fiscal transfers from the UK is £4 billion. The House of Commons Scottish Affairs Committee predicted that that would rise to £6.5 billion this year, as oil revenues fall. A significant amount of funding that currently comes through Barnett would be at risk, and that risk would be to public services throughout Scotland.

A further fact is that, although we raise £400 more per head in taxes, we spend £1,200 more per person. If we were not spending that money, there would be major risks to Scotland.

Mr Swinney says that the recovery is “well established” in terms of growth and jobs and that

“Scotland is, and continues to be, a wealthy country”,

but I would argue that taking out £4 billion to £6 billion would change that position.

The difference between what we spend and what we raise is £12.4 billion—and when I say that, I am not talking down Scotland; I am simply stating the facts.

We have talked about Tory austerity, and the fact is that the levels of austerity that we face if David Cameron remains in Downing Street will be substantially more than anything that we have seen to date, with public services under more and more threat. Instead of people trying to claim and celebrate the successes of the Tory-Liberal coalition, I would also argue that, if we had not tried to cut ourselves out of the deficit and if we had instead spent more to grow our way out of it, we would be in a much stronger position today. In fact, when the current UK Government came to power in 2010, the country was coming out of recession because of a policy of growing the economy, but that approach was stalled by the Conservative chancellor’s policies.

Jim Eadie (Scottish National Party, Edinburgh Southern)

I would never accuse Mr Rowley of talking down Scotland, but does he accept that the alternative to austerity that he has outlined is exactly the approach and policy of the Scottish Government, which has accelerated capital investment to ensure economic growth, despite the cuts that have been imposed by Westminster?

Alex Rowley (Labour, Cowdenbeath)

But full fiscal autonomy will not only undo all that work but create greater austerity. The options before us are Tory austerity as a result of a right-wing ideologically driven economic policy or SNP austerity driven by a nationalist ideology. However, there is a third option: the ending of austerity under Labour through an ideology that is driven by fairness, justice and equality. The figures that have been highlighted this afternoon bring the different choices to the fore. The facts remain, and I find it difficult to understand why the SNP would put all of that at risk.

The Deputy Presiding Officer

You are in your final minute.

Alex Rowley (Labour, Cowdenbeath)

Why would the SNP risk the pooling and sharing of resources across the UK and having a strong Scottish Parliament?

In conclusion, I want to come back to Mr Swinney’s comment that the recovery is “well established”, that there has been growth in jobs and that Scotland is “a wealthy country”. That growth and that wealth are not being shared across the whole of the Scottish economy; in many parts of the economy, there has been no direct intervention to ensure that the least well-off and those who are least able to take advantage of the benefits of our growing economy can do so.

These austerity measures will do little to help that situation, and I appeal to the Deputy First Minister to consider a national poverty strategy for Scotland that will drive the economy and ensure that everyone and every community in Scotland—

The Deputy Presiding Officer

You must close, please.

Alex Rowley (Labour, Cowdenbeath)

—can share the benefits of our growing economy.

The Deputy Presiding Officer

Thank you very much. If the next speakers take a little bit less time, I might be able to fit everyone in.

Joan McAlpine (Scottish National Party, South Scotland)

The Opposition parties are fond of saying that we should move on from the referendum. I think that it is probably time that they started taking their own advice, because the entire thrust of their arguments today is that Scotland is a bit of an economic basket case—in other words, all the things that they said during the referendum. For all the talk of the new saltire-draped Labour—call it “yes Labour”, if we must—its members, despite all their denials, continue to be the same old naysayers.

Jackie Baillie (Labour, Dumbarton)

Will the member give way?

Joan McAlpine (Scottish National Party, South Scotland)

No—I am trying to make progress.

Given that the custodian of Scotland’s economy is, and has been for hundreds of years, the Westminster Government, if we are not doing as well as we should be doing, we all know where blame lies. It lies where power lies.

To take the very long view, it is interesting to note that, when Scotland lost its Parliament in 1707, its population was a fifth of that of England: its population was 1 million compared with England’s 5 million. Now, Scotland’s population is 5.2 million compared with England’s 53 million. England’s population is almost nine times that of Scotland, although a slight improvement is showing—one that has been created since the Parliament was established and confidence began to grow in the country again.

People follow power, just as money follows power. Indeed, anyone who listened to the evidence that was presented at the Economy, Energy and Tourism Committee meeting this morning would know that power also follows power. The energy market in the UK is designed entirely by the Westminster Government, with dire consequences for places such as Longannet, which has to pay transmission charges of £40 million a year. By comparison, if it was located in London, the transmission charges would be zero. It was very clear from the evidence that Scottish Power, the National Grid and the Office of Gas and Electricity Markets gave today that our being a smaller country with a smaller population far from where power lies means that energy policy is not shaped in our interests or in the interests of our economy.

Fiscal autonomy is as much about the control of regulations such as the energy and telecommunications regulations as it is about what taxes we control. We need a framework or network on which we can base our growth.

Gavin Brown (Conservative, Lothian)

Based on what the member has just said about energy, does she support an entirely separate Scottish energy market?

Joan McAlpine (Scottish National Party, South Scotland)

I support a fair energy market that works in the interests of all people. It is very clear—it was very clear from the evidence that we took this morning—that the energy market is not fair. It is certainly not fair to the people who work at Longannet in Fife.

There is already a very good example of fiscal autonomy in Europe that has, in a relatively short time, demonstrated that shifting power from the centre can result in an economic step change. The Basque Country signed its economic agreement with Spain in 1980. At the time, the region was suffering from an economic crisis—it was in some ways similar to Scotland: like parts of central Scotland, it was post industrial. In some of those post-industrial areas, unemployment in 1980 was around 25 per cent and incomes were well below the EU average. The economic agreement gave the Basque Country and Navarre complete control over all their taxes. Now, as the European Commission confirms, the Basque Country is the wealthiest region of Spain. Its GDP per head is 30 per cent higher than the EU average and 35 per cent higher than that of Spain.

It is important to look at what the Basque Country has chosen to do with its fiscal autonomy. It is significant that it used its autonomy to build a much stronger industrial base that focuses on manufacturing, particularly steel, machine tools, energy and engineering. It did not pursue the property and tourism-based expansion that characterised growth in the rest of Spain and which, of course, put the rest of Spain in an incredibly vulnerable position when the global downturn came. There was a catastrophic collapse from which the larger country still has not recovered.

That example shows what can be done with full fiscal powers if people have a vision and focus on what they want to do with those powers. The Basques chose to reindustrialise. How much easier would it be for Scotland to meet some of our ambitious export targets, boost innovation and manufacturing and create well-paid jobs if we had the Basque Country’s powers to help us do that?

The Deputy Presiding Officer

You are in your final minute.

Joan McAlpine (Scottish National Party, South Scotland)

Quite a bit has been said about oil, on which I will finish.

As other members have said, oil prices go up and down, and it is true that they are currently depressed. However, the lack of fiscal autonomy meant that Scotland did not get the benefit from its resources when oil prices were high. For example, between 2009 and 2014, revenues from the Scottish North Sea totalled £32 billion, but over the same period the Scottish Government’s budget was cut in real terms by 10 per cent. It is worth saying that, in all the years of Labour Government, when Scottish oil revenues raised £94 billion, not a penny was saved.

Somebody mentioned an oil fund and said that it is not mentioned any more. I would like to mention it.

The Deputy Presiding Officer

You should draw to a close, please.

Joan McAlpine (Scottish National Party, South Scotland)

Norway set up its oil fund in 1990, when oil prices were relatively low. As a result, it has the largest sovereign wealth fund in the world. It faces the same challenges that we face with the oil price, but it is certainly not as nervous as we are about the future.

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

It has been an interesting debate, and I have to say that the most interesting contributions have come from those who have managed to get past the numbers and think about the people, although the numbers debate is also important. I was interested in Iain Gray’s speech, but I particularly identify with what Neil Findlay said, or at least with his starting point. Despite my background being totally different from his, I absolutely identify with those younger members of our society who do not see a future, do not believe that anybody is much on their side, and have real difficulty in seeing any way forward at all.

I understand that, but it is not entirely true that no one is on their side, because the current Government and previous Scottish Governments over the years have tried, with the powers available to them, to improve education, make college places available to folk, increase the number of apprenticeships and improve our health service. What the current Government has done slightly better is that it has tried to remove inequalities.

I was not going to mention “The Spirit Level”, but since John Mason said that I had better, maybe I should. There is some international evidence that it is a good thing to do in its own right; if members are not familiar with that book, I return to the general theme that they should be.

I want to pick up on the Deputy First Minister’s amendment, which talks about all the things that I have mentioned—things that are within our powers and things that we would simply be able to do better if we had control over all the financial levers.

Neil Findlay (Labour, Lothian)

Mr Don could have all the powers that he wants, but if he is not prepared to redistribute the wealth in the economy he will not target the people I am speaking about. Can he tell us where the redistribution is happening at the moment under his Government?

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

The Government is doing what it can, but it cannot spend money twice. I return to the point that Neil Findlay himself raised about the living wage, which I think we all support—at least, most of us do. I ask him please to recognise—unfortunately, some of his colleagues do not—that we cannot impose it. Current powers do not allow us to do that, and the idea that we should have put it in statute just ignores the fact that we have advice from the European Commission that that would not be lawful.

We do not have control over some extraordinarily important things. We do, however, have some control over where we spend our money on infrastructure and on improving the economic environment in which we are trying to operate. A lot of work is going into skills and colleges. We keep coming back to the issue of reduced college budgets. We cannot spend money twice, but I ask people to accept that the Government has worked hard to ensure that the courses that are available are ones that lead to employment. We ignore that at our peril. Health improvements include trying to get people not to smoke and to drink less. All of that kind of stuff is in the Government’s portfolio, and I am delighted to say that we have worked on such things.

I was interested in what Gavin Brown said at the start of his contribution. I thought that he had probably remembered the same lecturer that I did—someone by the name of McGee; forgive me for not remembering his first name—at the London Business School, who said that, when thinking about economics, one should be clear, stick to principles and not allow oneself to get confused by the figures. He was not saying that we should ignore the figures; he was saying that we should not get confused by them, because the long-term trends are the important ones. We all know that.

It is also easy to get hung up on one particular risk and ignore all the other risks. Nobody has yet considered any risks to the rest of the UK economy, compared with which we are, apparently, in such a bad place. A member of my family who lives in London is trying to find a property at the moment, and I can assure members that London has to be some kind of risk. I am not at all convinced that the banks have learned very much. The property market in London is stupid and unsustainable, and I put it to Mr Brown and others that simply looking at what is happening in Scotland and ignoring the risks of the rest of the UK economy might be short term; in fact, I think that it is very short term. What we should look at is the strength of the Scottish economy, which Mr Swinney and others are working on.

Would we be better off if we were running our own affairs? I do not know a single person who would rather have their affairs run by somebody else. It is an absolute fact across economies in the developed world that reducing inequalities is the thing to do. That involves the richer contributing more and the poorer doing better as a result. We also know that every person who has ever tried to run anything wants to be allowed to get on with running it themselves and not to have constraints put on by other people, whose agendas might be very different.

If we stick to those principles, we can see why SNP members feel that we would be better off with what we call full fiscal autonomy, which is the ability to run our own finances, for better or worse—and actually we will do it rather better.

Hugh Henry (Labour, Renfrewshire South)

There have been some curious contributions this afternoon, not least those that have attempted to help us to understand history. Gil Paterson, I think, suggested that we should look at what the situation was when we joined England. In doing so, he avoided what happened in two nations coming together. That built on a comment by Mike MacKenzie, who thought that, in looking at the economics of Scotland, we should go back 300 years. It might have been more relevant had he suggested that we go back 320 years to the Darien scheme and its consequences, which propelled the two nations to come together when Scotland was bankrupted by the greed of its ruling classes and merchants. Some reports say that the lowlands of Scotland were decimated. I do not see his suggestion being of any advantage to us in trying to understand what happens now.

Neil Findlay used a useful phrase. When people are trying to learn English, they are often told that it is a very difficult language because we use words and phrases out of context, or we use them in a way that goes against their meaning. People who are learning English sometimes struggle with colloquialisms. The colloquialism of cutting off your nose to spite your face is a very good description of much of what has been said during the debate. If people really want to know what cutting off your nose to spite your face means, they should go back and read some of the speeches that have been made this afternoon, because that is exactly what many SNP members have been talking about. Nigel Don said it in a much softer way—he used the phrase “for better or worse”. Their position has been, “We don’t care what the consequences are as long as you give us the power to do what we want to do.” They ignore what the reality is for ordinary men, women and children the length and breadth of Scotland.

Some of the comments that have been made on social media today—clearly at the behest of SNP members and the SNP Government—are interesting. People have referred to the £400 per person more that we are paying in tax than people in the rest of the UK. That is all that we have heard from SNP members this afternoon. We have not heard about both sides of the balance sheet; we have heard only about the £400 per person more. Some people are even talking about demanding a rebate. Well, on you go—let us get back that £400 per person more that we have paid in taxes. However, will those people also offer to repay the £1,200 extra in public expenditure that we got at the same time? Is it a case of asking to get back the extra money that we paid out and conveniently forgetting about the rest? That is bizarre. As Jackie Baillie said, it is the economics of the madhouse.

Just today, the Joseph Rowntree Foundation published a report on deprivation and how councils are struggling to cope. One of the councils that it mentions is mine. The report is positive about what Renfrewshire Council is trying to do, but let us look at the effect of the extra 10 per cent cut if we lose Barnett—because that is what it will mean. A 10 per cent extra cut for Renfrewshire over and above the cuts that have already been imposed would represent £30 million a year—that is £30 million a year over and above what has already happened.

What has happened since 2007 in Renfrewshire? Between 2007 and 2012, when the SNP first ran the Government here at Holyrood and when the SNP, with the support of the Liberal Democrats, ran Renfrewshire Council, 2,000 jobs were lost. Despite the exhortations of John Swinney and others, 265 of them were teachers, and 80 were classroom assistants. When there is more by way of cuts, how will Renfrewshire Council cope? How will it cope with those extra cuts, given the way that it is struggling just now? What will those extra cuts mean for those who rely on our social work services and our care services? So that it can cope, the health service will try to put the pressure on to social work. Charges will have to go up and services will have to be reduced. Those are the consequences of full fiscal autonomy and of losing out on Barnett.

We can bandy words about and play with figures—we can do what we want—but let us at least be honest that we are talking about the lives of the ordinary men, women and children who will suffer as a result. By all means, let us look back 300 years, or 320 years, if members want. By all means, let us say “for better or worse” because we do not care about the consequences, but we should at least be honest that those consequences will be inflicted. We will get more austerity and it will hit hard those who are under most pressure and least able to cope. It will be the poor who will suffer from the bizarre notion of full fiscal autonomy.

The Deputy Presiding Officer

I apologise to the member whom I have been unable to call. We now turn to the closing speeches. As ever, I expect members who participated in the debate to be in the chamber for the closing speeches.

Willie Rennie (Liberal Democrat, Mid Scotland and Fife)

It has been a little while since we have heard the slogan, or trite retort, that those who question SNP policy are talking the country down, are not acting in Scotland’s interests and are not interested in the future of our nation. That simple, trite retort that we have heard so often today reveals the deeper conceit that if we question an SNP policy we are talking the country down, but the two are not one and the same thing, and thank goodness they are not.

We heard from Gil Paterson, who has not returned to his seat, two astonishing things. First, he said that Scotland is subsidising the UK. He used as evidence the extra £400 of tax per head that we contribute to the United Kingdom. As we heard from several members, that completely ignores the £1,200 per head of extra spending that we get in Scotland. Scotland subsidises the UK by minus £800—as John Swinney might call it, “a relative surplus”. Perhaps Gil Paterson should use John Swinney’s terminology in the future.

The second thing that Gil Paterson said—he is still not in his seat—was that the SNP does not want to abolish the Barnett formula. That is from a party that wants full fiscal autonomy—that is, to keep all our taxes. Unless Gil Paterson is proposing that the rest of the UK might put up with continuing to pay a Barnett share for our public services in Scotland as well as our keeping all our taxes here, he needs to review his position on that.