Scottish Parliament, 13 November 2008

416 contributions from 81 members. The official report.

Official Report 13 November 2008

Energy Efficiency

Alex Fergusson (None, Galloway and Upper Nithsdale)

Good morning. This morning is given over to Labour Party business. The first debate is on motion S3M-2864, in the name of Sarah Boyack, on energy efficiency.

Sarah Boyack (Labour, Edinburgh Central)

I hope that MSPs throughout the chamber will support my motion today.

My motion calls on

"the Scottish Government to take steps, as set out in the Energy Efficiency and Microgeneration Bill proposals, such as fiscal incentives for householders and businesses, to improve the energy efficiency of new and existing housing stock and ensure that microgeneration technologies become widely available and used."

My member's bill is drafted, but with the imminent introduction of the climate change bill and John Swinney's announcement that he is prepared to include measures on energy efficiency and microgeneration in that bill, I am keen to work constructively with him to ensure that the measures in my bill are included in the climate change bill. Those measures would greatly strengthen the climate change bill. If we are to have any hope of delivering the 3 per cent annual CO2 reductions that we need, we must maximise the potential contribution of energy efficiency, microgeneration and local community energy as we move towards becoming a low-carbon society.

I have met John Swinney, and although I recognise that he is keen on targets and monitoring, I do not think that there will be any progress to monitor without the other measures in my bill. I am happy to work with him constructively, but I put it on record that I believe that the cabinet secretary has not gone far enough to date. I hope that today's debate will encourage him to go further in the climate change bill.

I started work on my member's bill three years ago. I wanted to tackle climate change and fuel poverty and I believed at that point that we had achieved a huge amount with our main target of generating 20 per cent of our electricity from renewables, which we achieved early. However, making the shift to becoming a low-carbon society means that we need to involve people in the clean energy debate. We need to bring home to people their personal role and ability to tackle climate change. It will be a big cultural shift, but having spoken to colleagues at countless meetings throughout the country, I know that there is a powerful appetite for change. Housing associations can demonstrate that measures in new houses, such as high energy efficiency standards and microgeneration technologies, lead to warmer homes, cheaper bills and reduced CO2 emissions.

When I started work on my bill, every 5 per cent increase in domestic fuel bills led to 30,000 more people being dragged into fuel poverty. Energy bills have shot up and Energy Action Scotland now believes that every 5 per cent increase in fuel bills leads to 40,000 more households being dragged into fuel poverty. The tragedy is that we have the powers in Scotland to do something about that, but we are not using them to the full.

We have targets to reduce our carbon emissions by 80 per cent by 2050 and to increase electricity from renewables to 50 per cent by 2020. If we are to have a chance of achieving those targets, we have to tackle our housing stock. Our homes account for 34 per cent of our energy demand and a third of our emissions. Microgeneration schemes and combined heat and power schemes are efficient, because the power and heat that they produce do not have to be transported long distances across the grid. They can also produce much-needed base-load.

We have made progress in the past three years. I thank the MSPs from all parties who have supported me. I thank members of my party, the socialist environment and resources association and the trade unions, who have campaigned consistently over the years. I refer to my entry in the register of members' interests and thank in particular the organisations that agreed to form a steering committee to help campaign for my bill—Energy Action Scotland, Energywatch, Friends of the Earth, WWF Scotland, Barnardo's, Age Concern Scotland and the Scottish Renewables Forum. Their support and advice have been invaluable to me. We have secured a number of significant wins, but the work needs to continue.

Planning guidelines that have been in place since March 2007 now require all major developments to include on-site renewables to reduce CO2 emissions. Research by Friends of the Earth, however, shows that the guidelines are not being applied consistently by every local authority. We need all authorities to follow the examples of Edinburgh and Midlothian.

We have had progressive increases in the amount of money allocated to the Scottish community and householder renewables initiative; we have had the renewables pilot for the warm deal in rural areas that are not on the grid; and we have had the recent announcement from Gordon Brown of a major energy efficiency programme. That programme needs to be followed by action, which is why my colleague Lewis Macdonald has been lobbying the major power utility companies to ensure that we get the full benefits of it in Scotland.

Only last month, the United Kingdom Secretary of State for Energy and Climate Change, Ed Miliband, gave the green light to feed-in tariffs, renewable heat incentives and a roll-out of smart meters. Although it is clear that things are happening, barriers remain—not enough trained installers, not enough advice to householders, and none of the economies of scale for renewables kit that a mass market would bring.

There is still planning red tape. SNP ministers' draft proposals to cut the red tape were roundly criticised—we are still waiting for the final Scottish statutory instrument, and it would be great if ministers would tell us today when it is coming. Let us make no mistake: jobs are at stake, particularly in the microwind industry, and jobs will go if we do not get fast action from ministers. I hope that we will get that fast progress.

We are still waiting for the much-vaunted energy efficiency strategy. I quote my opposite number, the Cabinet Secretary for Rural Affairs and the Environment, Richard Lochhead, who said in 2004 that

"energy efficiency is the missing link in the Scottish Government's efforts to tackle climate change and fuel poverty."

Again, we are waiting. A lot has been done, but there is a lot still to do. We urgently need fiscal measures to get going so that householders and businesses can install energy efficiency measures and microgeneration kit. People in England are far ahead of us. They have that power, through council tax reductions, and we need the same opportunities in Scotland.

Energy efficiency and microgeneration go together. If we are to tackle climate change and fuel poverty, we need to amend the climate change bill. I am very keen to work with Scottish National Party ministers. We need to make sure that change happens through collective will in this Parliament. We want to ensure that we benefit from jobs, reduce fuel poverty and lower our carbon emissions. There is a great industry out there that is waiting for us to take action.

I move,

That the Parliament recognises the significant role that energy efficiency and microgeneration measures could have in reducing energy costs for householders and businesses, in achieving urgent reductions in greenhouse gas emissions of at least 80% by 2050 and contributing to the eradication of fuel poverty by 2016; notes that research carried out by the Energy Savings Trust suggests that widespread installation of microgeneration could provide 30 to 40% of our electricity needs by 2050 but that current investment in energy efficiency and microgeneration measures is insufficient to achieve these goals, and calls on the Scottish Government to take steps, as set out in the Energy Efficiency and Microgeneration Bill proposals, such as fiscal incentives for householders and businesses, to improve the energy efficiency of new and existing housing stock and ensure that microgeneration technologies become widely available and used.

Robin Harper (Green, Lothians)

I have supported Sarah Boyack's proposal for an energy efficiency and microgeneration bill since its inception about two and a half years ago. However, there is room for serious debate about scale, pace and criteria. The short version of the Green party amendment states simply that we should prioritise insulation above all. I will give the reasons for that in the next few minutes.

SPREG—the cross-party Scottish Parliament renewable energy group—changed its name 18 months ago to the Scottish Parliament renewable energy and energy efficiency group, of which Sarah and I are co-conveners. There was a good reason for the name change, which is that we should not—now or in the future—debate energy generation and energy efficiency separately whenever there is a useful opportunity to debate the two together. This morning presents such an opportunity.

Before the last election, the Green party proposed a warm homes bill. Unlike Sarah, I have held back from continuing with that bill for the time being in the hope that—as Sarah hopes—most of the ideas in our proposed bill might be included in the climate change bill when it is introduced.

We have to take the fastest route towards reducing our impact on the environment by 80 per cent by 2050. If we take the slow route, by 2050 we could have as much as twice—certainly a third more—carbon dioxide as is already in the atmosphere warming the world. It might be too late if, by 2050, we have reduced our daily output into the atmosphere but have not started to achieve the reductions much faster.

I hope that everybody in the chamber will agree that investment in energy efficiency now is what we need because that will produce the biggest payback. The Transport, Infrastructure and Climate Change Committee has received plenty of evidence to prove that point.

The Stern report showed clearly that every £5 that we invest now will save £5 in the future. It is almost a no-brainer that insulation should be our biggest priority. There are so many add-on benefits to our going down the insulation route—it is a case of win, win, win. The Federation of Master Builders is looking for work just now. The biggest block to that is the 17.5 per cent VAT on home improvements. I know that this is not within our purview, but, under European rules, the Westminster Government could now reduce the VAT on home improvements to 5 per cent, which would make an enormous difference.

Aligned to that, the Green party proposes fully funded, regional rolling programmes of insulating housing in Scotland. Those programmes could be similar to the project that is under way in Kirklees, which is proving to be extremely popular and effective. We really ought to consider that, because we can afford it. If we take the slow route, we will almost certainly not get there.

On rooftop renewables, I think that Sarah Boyack would agree that we need to carry out a careful audit that shows which measures are most appropriate and where. We do not know enough about that. In Amersfoort in Holland—in the Nieuwland quarter—seven different kinds of photovoltaics are being tested on the roofs of houses in a new housing estate. In three years' time, the people responsible for that will be able to tell the rest of Holland, us and Europe which are the best rooftop renewables.

As Sarah said, heating and water accounts for 50 per cent of the energy used in our homes. Those are the easiest areas in which to save money through insulation measures. Insulation costs a fraction of other strategies; maintenance is minimal; its lifetime can be the lifetime of the house itself; and it is extremely easy to install. Therefore, such measures should appeal to people throughout the country.

All the other things that we can do are also relatively simple and quick, such as installing secondary and triple glazing and shutters; ensuring air-tightness; and fitting draught-proofing around doors and old casement windows. All those things can be done swiftly. We could draught-proof and insulate Scotland within a decade if we put our minds to it. We call on the Parliament and the Government to set in motion the achievement of that big vision.

I move amendment S3M-2864.1, to leave out from "improve" to end and insert:

"ensure that microgeneration technologies become widely available and used and to consider other energy efficiency measures for new and existing housing stock to tackle fuel poverty, climate change and security of energy supply; notes the evidence given by Friends of the Earth Scotland to the Transport, Infrastructure and Climate Change Committee suggesting that an additional £100 million per annum would be a welcome change to the draft budget for 2009-10, and calls on the Scottish Government to consider a comprehensive and fully funded Scotland-wide scheme on this scale to provide energy audits, insulation provision and financial support for micro-renewables where appropriate."

Alex Fergusson (None, Galloway and Upper Nithsdale)

I remind members that the accepted chamber protocol is that they do not call each other by their Christian names, even if they co-convene a very worth while cross-party group.

Stewart Stevenson (Scottish National Party, Banff and Buchan)

I thank Sarah Boyack for lodging the motion and I welcome the debate. I hope that all will take heart from our willingness to support the motion. Members should be in no doubt that the Government wants to see a reduction in the demand for energy through greater energy efficiency and through the generation of more renewable energy, which will play a significant role in reducing Scotland's emissions.

Our climate change bill is recognised as ambitious, world-leading climate change legislation that will drive new thinking, new solutions and new technologies, putting Scotland at the forefront of building a sustainable low-carbon economy. Dr Richard Dixon, director of WWF Scotland, has said:

"what we are promising amounts to the best climate change legislation in the world."

We are not in competition; we each have to respond to the circumstances and opportunities that we have, but I think that we are showing the way.

We will be making provisions in the Scottish climate change bill that will give this Government the powers to promote energy efficiency and incentivise the generation of heat from renewable sources. That demonstrates a clear commitment from the Government and recognises the central role that energy efficiency and renewables will play in reducing our emissions.

However, we will not wait for our climate change bill to be passed before we take action. Enabling consumers and businesses to make energy savings is one of our top priorities and is vital in the current economic climate. We led a stimulating debate on the economy yesterday. It is clear that we cannot sit back and wait for things to get better—action is required now.

We are already taking a number of steps within our powers to intensify efforts on energy efficiency, microgeneration, fuel poverty and climate change, representing a total investment of around £226 million this year.

Patrick Harvie (Green, Glasgow)

Will the minister respond to the call in our amendment for more resources, which came from Friends of the Earth Scotland, which argued at a recent meeting of the Transport, Infrastructure and Climate Change Committee that further changes in this year's budget would be necessary if we were to demonstrate the kind of progress that is required?

Stewart Stevenson (Scottish National Party, Banff and Buchan)

I am sure that as we proceed with the budget we will hear interesting debates about the amount of money that we are able to devote to different areas. I am sure that the Greens will pursue the issue in that context.

We are enhancing advice and information to stimulate and encourage consumers and businesses to take action and we are providing financial incentives.

We are working with the energy companies to increase their investment and activities in Scotland; we are helping our most vulnerable citizens, who have been plunged into fuel poverty; we are slashing business rates; we are taking forward proposals to exclude microgeneration investments from business rates; and we are already developing new energy standards for new buildings in the light of last year's Sullivan report.

We are also consulting on proposals for improving the energy performance of existing non-domestic buildings and, shortly, we will consult on additional measures that are needed to reduce energy use and carbon emissions in Scotland's existing housing.

I very much welcome Ed Miliband's announcement that he will make amendments to the Energy Bill for feed-in tariffs. That is an excellent move and I hope that he will follow it up by changing the penal regimes for connecting larger-scale renewable energy to the network.

Debates such as today's debate are critical. They help us to share and develop good ideas. I welcome the discussion and I believe that we can have a consensual and useful debate today. We want to contribute in that spirit, as I hope everyone else does. We want to maintain Scotland's reputation as a global leader in tackling climate change.

Alex Johnstone (Conservative, North East Scotland)

I rise not only to support the motion in the name of Sarah Boyack but to pay tribute to the work that she has done on this subject over a long period in the Scottish Parliament. At one point, she and our former colleague Shiona Baird proposed bills that covered similar areas of policy. At the time, the Conservatives considered those two comparable bill proposals and decided that the way ahead was the way that Sarah Boyack had proposed.

We paid further tribute to Sarah Boyack's proposals by, let us say, borrowing some of them and putting them in the Conservative manifesto last year under the heading "Eco-Bonus Scheme".

She might have recognised some of those proposals.

The debate comes at a time that is slightly different from the times when the previous debates took place. One or two other things have to be said. I still receive letters from enthusiastic and—it would appear—honest individuals, who believe that climate change is not the issue that we believe that it is. In all honesty, given the current economic situation, even if there was no carbon benefit to the proposals in Sarah Boyack's bill, the contribution that it would make to alleviating fuel poverty and overcoming the economic difficulties that so many families in Scotland face would in itself mean that it was appropriate for us to support it. We are talking about a genuine win-win situation.

We need to work hard on a number of areas. We still have progress to make on the implementation of microgeneration measures. Microgeneration opportunities in our towns, particularly where strict planning controls exist, are still difficult to encourage and hard to take through the planning process. Planning regulations do not need to be changed, but how local authorities implement those regulations in some areas discourages the investment that could happen, even today.

Such investment is becoming more and more important. As I said, we are entering an economic downturn. Opportunities must be found to create worthwhile employment and to invest Government and private money in measures that will make the world more economically justified, particularly in Scotland, where the weather is still cold, despite global warming. Such opportunities are presented by the chance to make a limited investment that will encourage the development of energy efficiency measures, microgeneration and renewables in domestic and light industrial settings and will give us a new industry that could create new jobs when they are needed more than ever.

It would be inappropriate to end my speech without paying tribute to the Green party for its work to put such issues at the centre of the agenda. I am very interested in that party's amendment and will examine it further during the day to consider whether we can support it. In these difficult times, we must be wary of anything that has a cost placed on it. However, I will discuss that further with Green members after the debate.

We approach publication of the climate change bill, which we expect some time in early December. At the Transport, Infrastructure and Climate Change Committee's meeting on Tuesday, we went to great lengths to try to obtain a publication date from the minister, but the best answer that we could get was that it would be some time in the first half of December. Perhaps he will give us a date in this debate.

When the climate change bill is introduced, we genuinely expect it to contain measures that reflect the spirit of Sarah Boyack's motion. We look forward to the opportunity to support such measures and to ensure that Scotland becomes a greener place more quickly than it might otherwise have done.

Liam McArthur (Liberal Democrat, Orkney Islands)

Scottish Liberal Democrats warmly welcome the debate. We support Sarah Boyack's motion, which mirrors our manifesto, too, and addresses many concerns that were highlighted in our motion on fuel poverty, which the Parliament supported in March.

Sarah Boyack's motion articulates clearly the challenge that we face in meeting our climate change targets and highlights the potential for energy efficiency and microgeneration to help us meet that challenge. It outlines constructively the steps that the Scottish Government must take to make that happen. In that endeavour, ministers know that they can count on the full support of all parties in the Parliament. The development of the energy efficiency and microgeneration bill has been characterised by its cross-party and consensual nature, which was reflected in Sarah Boyack's speech.

The measures in the energy efficiency and microgeneration bill can provide a win-win-win by reducing carbon emissions, tackling fuel poverty and providing security and continuity of supply. Of course, the general principles are scarcely controversial. Only the most ardent flat-earther—who appears to be in regular correspondence with Alex Johnstone—would contest the notion that urgent and radical action is needed to reduce our energy demand and increase our reliance on renewable energy sources.

At the same time, the Government is right to argue that disagreement will arise on details in the bill—I can think of one or two issues on which I am likely to find myself shouldering arms with the minister. However, those are matters for debate in due course. The fact is that the Government still flatters to deceive on energy efficiency and promoting microrenewables. Ministers tend to announce and retreat. Nods and winks are given to the press and selected stakeholders, carefully choreographed photo opportunities are arranged and the sense is created that more progress is being made. However, as the bill's steering group makes clear,

"Despite several Scottish Government announcements, none fulfils the proposals set out for this Bill or will ensure that energy efficiency improvements and microgeneration measures are mainstreamed across society by requiring and incentivising such measures in homes or businesses".

If ministers support the motion—as they say they do—no further retreat can occur.

It beggars belief that, 18 months since the Government came into office, ministers still have not published their action plan on energy efficiency. The Government was bequeathed a draft by the previous Executive, which was drawn up thanks to input from a wide range of independent experts, so it is hard to find any justification for the Government's failure to set out its intentions and how it plans to achieve them.

The preamble to the much-delayed renewable energy framework is welcome but insufficient, as Scottish Renewables and others have made clear. It would help to hear in the winding-up speech what assessment the Government has made of the Association for the Conservation of Energy's proposals on planning, regulation, finance and information and advice, to which Sarah Boyack and Alex Johnstone referred. ACE suggests that about half of new homes are not built to current energy efficiency standards. If that is the case, it is deeply worrying. It would be useful to know what steps ministers will take to address that.

Given that 85 per cent of existing homes will still be occupied by 2050, perhaps it is more important that the Government set out its intentions to step up the retrofit programme. I welcome the minister's statement about the Sullivan report's recommendations.

At the heart of any effective strategy must lie fiscal incentives for businesses and households. Agreement on that is fairly unanimous. However, ministers have sought to hide behind the skirts of the local income tax to justify their failure to support the energy efficiency and microgeneration bill. That is a little like ministers saying that they will not bother to introduce any measures until independence is achieved. It is obvious that many nouveau loyalists on the back benches privately agree with that approach, but the First Minister and his colleagues have—rightly—rejected it publicly.

Like the SNP, we support a local income tax, albeit one that is genuinely local and which provides several other safeguards that Mr Swinney is now actively considering. We are happy to work with the Government on ways of using a fairer local taxation system that is based on the ability to pay to incentivise households to adopt energy efficiency measures and microrenewables technologies, but we must establish the principle of such incentives first. Government support for today's motion is the necessary first step.

Elaine Murray (Labour, Dumfries)

I am of course pleased to support the motion in the name of my colleague Sarah Boyack, who is to be congratulated on having done much in the Scottish Parliament over the years to promote microgeneration.

We have heard much from Scottish ministers about the importance of renewables technologies to tackling climate change and their potential contribution to the Scottish economy. Much of that has focused on large-scale developments, such as offshore wind farms. However, that is only one side of the story. It would be wrong for any of us to underestimate the contribution to tackling climate change and fuel poverty that small-scale individual efforts can make.

One third of the total energy demand and of CO2 emissions in Scotland is attributable to the residential sector. It is therefore a key sector in which the Government can encourage and facilitate action by individuals, families and microbusinesses to install measures to reduce energy loss and to generate power from Scotland's natural resources.

It is obvious that enabling households to generate their own power can address fuel poverty problems. According to a recent survey by the now-defunct Communities Scotland, a 5 per cent increase in energy prices pushes an additional 30,000 households into fuel poverty. That can be a particular problem in rural areas where properties have no access to the gas network and rely on more expensive electric or oil-fired systems. For the 30 per cent of the Scottish population that are in that situation, renewables technologies such as ground-source and air-source pumps and solar panels can offer a welcome addition to their facilities, so I welcome the recent announcement by the secretary of state, Ed Miliband, that the UK Government is to table an amendment to the Energy Bill to complement the renewables obligation with a guaranteed price for small-scale energy generation that feeds into the national grid.

The barriers for individual households to participating in microgeneration are financial and bureaucratic. The bill proposal that Sarah Boyack lodged in the previous session and again in June 2007 presents several strategic actions and financial incentives, some of which the Cabinet Secretary for Finance and Sustainable Growth has already accepted, and others of which I hope that ministers will accept as discussions continue.

The SNP's rhetoric in opposition needs to be matched by action in government. Like Liam McArthur, I would like to know the status of the Government's energy action plan, which was promised last year but is still unpublished, 18 months after the SNP took office.

Alex Johnstone referred to planning. Households are discouraged from microgeneration installation not only by the cost of technologies, but by the planning system. The previous Scottish Executive commissioned research from Heriot-Watt University on the developments that the general permitted development order should cover. In early 2007, that review advised that the GPDO should be extended to a range of microrenewables technologies. We are still waiting for a response from ministers—I hope that it will be timeous.

As Robin Harper said, we also need to look at energy efficiency measures. We have heard today that the Government is considering adopting the Sullivan report's recommendations, but will it follow the UK Government's lead by agreeing to procure only buildings that are in the top quartile of energy performance? How will ministers respond to the concerns expressed by Energy Action Scotland about the condition of existing housing stock, particularly in the private, owner-occupier and rented sectors? Can the Government answer the Association for the Conservation of Energy's concerns about whether Scotland is sufficiently prepared to meet the European deadline on energy performance certificates? Even if it is, how are we to address the fact that owners are under no obligation to act on the information contained in the certificates?

In October 2004, Richard Lochhead accused Scottish ministers of paying lip service on those issues. Of course, we refuted those allegations at the time. By addressing microgeneration and efficiency measures, the present Scottish Government can prove that its commitment is more than just lip service.

Rob Gibson (Scottish National Party, Highlands and Islands)

I will range over some of my personal experiences in this area. Jack McConnell, Jim Hume, Robin Harper, Mary Scanlon and I have been taking part in an MSP energy action challenge over the past year.

Liam McArthur (Liberal Democrat, Orkney Islands)

Who won?

Rob Gibson (Scottish National Party, Highlands and Islands)

We are about to hear from the organisations who arranged it.

We have all experienced considerable difficulties with our various types of house. My house, which is about 14 years old, started off being among the best insulated, but building regulations have improved since it was built and, through thermal imaging, we found out where the problems were.

Every person should be able to access thermal imaging for free. All councils have thermal imaging equipment and it should be made available to everyone. We could take that first step without any plans or anything else like that. We found out where the thermal imaging equipment was in Highland Council, and it would be a good idea if every council area started to provide a thermal imaging service, because it triggers ideas about what needs to be done.

I could mention many other aspects of the energy challenge, which might be won by the person who most improved their house's energy efficiency capacity; we have yet to hear the results, which we look forward to with interest. We are building an extension that will include a solar panel, which will change our heating system, but that will not happen within the year of the competition.

We must think about how building regulations are applied. If the houses that we are building now are causing more problems for the future, we must bring that to an end, and the sooner the better.

I am more concerned about rural housing, tenemental property and non-standard retrofitting. We must find ways of pinpointing what can be dealt with. That presents an opportunity for a Government agency that is known for its inflexibility. Historic Scotland could set an example by allowing many of the places that are in United Nations Educational, Scientific and Cultural Organization heritage sites, for example, to use modern methods. Why do we have to maintain Historic Scotland's buildings to standards that were set in the 18th century? That is crazy in this day and age. Such buildings need not look any different, but they could contain modern materials, and it is high time that we asked Historic Scotland to review its policy. Conditions such as those, near my office, in Argyll Square in Wick, which Jamie Stone and I know well, are ridiculous. That is the kind of thing that could be dealt with now.

The fact that 34 per cent of our energy demand comes from houses must be tackled head on. The Transport, Infrastructure and Climate Change Committee went to see London's green concierge service, which organises specialist advice for people who can afford to deal with their homes' energy efficiency problems, so that people can get on and spend the money. The Greater London Authority also invests in the affordable housing sector in the same way. We should learn from that plan.

My niece's husband trains people in insulation installation. Given the debate at the moment about what to do about the construction industry and considering Robin Harper's point about VAT reduction, we should be training the many apprentices who might be out of work in construction in insulation installation. Making progress on that will take the construction industry and the Government working in a genuine public-private partnership.

I have no time to speak about anything else, but I welcome the mostly consensual nature of the debate.

James Kelly (Labour, Glasgow Rutherglen)

I support Sarah Boyack's motion, and welcome the opportunity to take part in this morning's debate. There are important matters to be discussed against the background of energy companies having doubled people's bills in the past five years, a 5 per cent increase in fuel costs resulting in 40,000 more people falling into fuel poverty and UK households emitting 153 million tonnes of CO 2 every year. Governments around the world, and in the UK and Scotland in particular, face the challenge of reducing fuel bills, tackling fuel poverty and reducing emissions to help in the fight against climate change.

I welcome the work that is being done on the proposed climate change bill and the fact that some of the measures in Sarah Boyack's proposed member's bill have been incorporated. It is worth noting the work that Sarah Boyack has done over a long period. She has campaigned consistently on the environment, even when environmental issues were not as popular as they are now.

Unfortunately, although some progress has been made, it has been a bit on the slow side. We need to see some practical measures being taken. It is one thing to set a target of an 80 per cent reduction in carbon emissions by 2050, but we need to help households throughout Scotland, particularly at this time of economic decline. From that point of view, some of the practical measures included in Sarah Boyack's bill are very useful indeed. We could look at incentivising council tax payers by giving them a £100 rebate if they install microgeneration. That would encourage the installation of microgeneration and reduce fuel bills.

In my constituency, Cambuslang and Rutherglen Housing Association piloted a scheme to install solar panels. That has directly reduced tenants' bills and has been of tremendous benefit to pensioners. That shows what can happen when the right equipment is installed.

When there is a financial crisis and the economy is under pressure, it is important to stimulate economic growth. Investment in microgeneration would be a step in the right direction.

It is also important to consider renewable energy obligations on new buildings. They should be tightened up to ensure that we have the best environmental standards. Rob Gibson alluded to that. Indeed, it is reckoned that 1.5 million homes in Scotland do not have their lofts correctly insulated.

I support speeding up the process for the removal of red tape so that planning permission can be given more quickly for microgeneration installations.

I welcome some of the UK measures that have been introduced to tackle energy efficiency problems, and the fact that smart metering is going to be mandatory across the six major energy companies. Members on the SNP back benches have been calling for that and motions have been lodged, so I am sure that we all welcome that.

The debate has been good and many important issues have been raised. Progress has been made but we need to speed it up and make action on the issue a priority. Swift action is needed now.

Christopher Harvie (Scottish National Party, Mid Scotland and Fife)

I congratulate Sarah Boyack on her motion. She has a fine environmental reputation and is the daughter of Jimmy Boyack, a good architect as well as a stalwart home ruler, who built his own Bauhaus-style villa near Cramond. As I remember, it incorporated part of one of Princes Street's greatest buildings, which was destroyed by corporate vandals in the 1960s.

That gives me my text, because 50 per cent of our carbon emissions involve heating—domestic and commercial. Adapting to a renewables regime will probably involve, for a time, increasing our manufacturing emissions, because manufacturing is necessarily heat intensive. One way in which we can save on industrial emissions is, of course, to import the equipment and fittings that we need and to pay only the transport costs, which seems a brilliant wheeze, except that it does not give us much chance of becoming world leaders in the industry or of creating a lot of jobs.

Robin Harper (Green, Lothians)

Does Chris Harvie agree that an increase in the release of carbon dioxide emissions into the atmosphere from manufacturing could be avoided if our proposal to introduce a large-scale project for energy efficiency and insulation in Scotland's houses were adopted?

Christopher Harvie (Scottish National Party, Mid Scotland and Fife)

Yes—thank you, Mr Harper.

If we are to be world leaders in such technology, we must not only cope with repairing our deindustrialisation—manufacturing, which accounted for 30 per cent of gross domestic product in 1970, when we tackled North Sea oil, has come down to less than half that level, and the impact on engineering training and skills, which are well below European levels, has been significant—but be extra efficient across the board. Insulation would give us an important and manageable training phase while fundamental research is conducted on wind, wave and tidal energy.

We face an extremely sensitive challenge in Glasgow and Edinburgh, in particular. Georgian and Victorian Scotland were built in an age of cheap and plentiful fuel, when no conservation questions were asked, so there are plenty of plate-glass sash windows, chimneys, lofts, stairwells and cupolas through which heat can and does enthusiastically escape. The costs of preventing that are potentially huge. The alternative of cheap double glazing does not do our townscape any favours. The lofty astragalled windows of Edinburgh's new town are one of our civic glories, and one does not improve them by visiting one's local DIY store.

The costs of triple glazing such windows are formidable. Furthermore, there are all sorts of problems with ventilation, condensation, maintenance, safety and so on. Much of the heat loss is through the window housing rather than the glazing, so I suggest that insulation and heat retention should come within the scope of the saltire and horizon prizes that are offered by the Government. Retrofitting can be expensive, but if a mass-produced triple-glazed window that would be fitted behind the existing windows could be developed and installed as part of a programme, we would have made a breakthrough that could—given the numerous historic towns of Europe and America—be an export winner. In addition, we would have trained up a generation of technicians to face greater and more rewarding challenges when renewable regeneration comes on stream.

Alex Fergusson (None, Galloway and Upper Nithsdale)

After Marilyn Livingstone, we will come to closing speeches.

Marilyn Livingstone (Labour, Kirkcaldy)

Thank you for the opportunity to take part in the debate, Presiding Officer.

I think that I can confidently say that everyone in the Parliament agrees that Scotland's ambition should be to lead the world on climate change. Scottish Labour has a strong record on tackling climate change. The Labour-led devolved Government set ambitious targets for renewables generation in Scotland and completely transformed the country's recycling record. I join other members in supporting the target of reducing carbon emissions by 80 per cent by 2050.

Alex Fergusson (None, Galloway and Upper Nithsdale)

I am sorry to interrupt, but could members please check that their electronic equipment is turned off, because we are getting interference?

The problem has been solved—thank you.

Marilyn Livingstone (Labour, Kirkcaldy)

I warmly welcome Gordon Brown's commitment to work towards the 80 per cent target across the UK.

The measures in Sarah Boyack's member's bill on microgeneration, which proposed incentives to encourage the use of small-scale renewables technology, were supported by the SNP when they were in opposition, but now that they are in power, they seem to be backing away from many of them. I pay tribute to Sarah Boyack for her total commitment to the agenda over many years. The SNP Government talks about committing to an 80 per cent reduction in carbon emissions by 2050, but if we do not take all possible action now to make that happen, we will fail, with the result that we will leave an unacceptable legacy for our children and our children's children.

It is extremely disappointing that the Scottish Government's policies on transport, energy and energy efficiency do not measure up. Examples of those policies are putting out to tender the electricity supply to the Government but requiring only a part of the electricity to come from green sources; capping resources to support bus travel, which amounts to a real-terms cut; and attempting to cut the Edinburgh tram project.

In my constituency, the reduction in northbound and southbound train services for the people of Fife will mean that many commuters will be forced to travel by car if they are to get to work on time, or face lengthy travel times. For example, it will be impossible for Fifers who want to travel to Aberdeen by train to get to a meeting before 10 am. Commuters in my constituency and across Fife are extremely unhappy about the situation and a petition on the issue has gained many signatures. I have written to the minister, ScotRail and Network Rail to find out whether common sense will prevail. I hope that the minister will address those points.

Furthermore, as I know, as the chair of the cross-party group in the Scottish Parliament on construction, the construction industry is experiencing difficult times, as many of my colleagues have said. There have been many redundancies. The industry is calling on the Scottish Government to bring forward projects that will help to sustain its members through this difficult time and which will allow us to retain jobs and a skilled workforce, which is crucial both now and in the future. I ask the Scottish Government to give serious consideration to increasing local government's funding to enable it to expand its energy efficiency and retrofit programmes.

The Government must show the political will to develop measures that will be effective in bringing about a substantial change in energy generation methods. Labour members have made many suggestions that the Government could adopt, and I hope that the minister will respond to them. I am pleased that the Government will support Labour's motion, but I ask it to support all the measures that are contained in Sarah Boyack's proposed bill, which they supported in opposition. Tough action is needed on climate change. Progress has been made, but we must now realise our ambitions.

Alasdair Morgan (Scottish National Party, South of Scotland)

We move to winding-up speeches.

Patrick Harvie (Green, Glasgow)

Members of all parties have united in recognition of the contribution that Sarah Boyack has made over a long period to the debate on energy efficiency. She began her speech by calling for cross-party unity. If her motion remains unamended, I will certainly back it and I hope that the rest of the Parliament will, too.

Sarah Boyack and others, including Robin Harper, Stewart Stevenson, Alex Johnstone, Liam McArthur and Chris Harvie, have explained why the proposed measures are necessary. Chris Harvie is a freer spirit than most and he would be a worthy winner of that title if it goes his way tonight.

Few members and few people outside the Parliament doubt the urgency of the need to tackle climate change or the importance of consuming less energy if we are serious about achieving that target. In today's economic climate, it is clear that the best way of reducing energy consumption while saving households money is to implement programmes such as those that we are debating. Not only people who are technically in fuel poverty would benefit from that; households throughout Scotland would thank us for taking such action.

The only part of Sarah Boyack's speech with which I did not wholly agree was her description of the UK Government's track record in this area. I do not agree that it has been ambitious in tackling climate change. The ambition that is being demonstrated south of the border is attributable to local authorities, such as Kirklees Council, which are cracking on with programmes that are far more ambitious than anything that we are doing in Scotland, and are doing so with smaller budgets and less power than we have. There is no reason at all why we should not be able to match and outstrip their level of ambition.

A large part of Sarah Boyack's proposals relate to fiscal incentives. I will explain why incentives such as the council tax rebate are necessary but not sufficient. Of course, a journey of 1,000 miles begins with a single step, but on its own that step will not take us very far. If we want to achieve the scale of change that is necessary, we must remove all the barriers to uptake. The provision of a council tax rebate would certainly remove one barrier to uptake—it ticks that box. Planning changes would remove another barrier, which is great. Advice to households is good stuff, too. However, loan repayments are a huge barrier for householders, particularly at the moment, as are up-front costs. Another huge barrier is the hassle of getting energy efficiency work done. A geographically based, universal programme that is not means tested and which engages an entire local area at the same time would substantially remove the remaining barriers.

Stewart Stevenson reinforced the Government's frequently stated indications of intent to incorporate some of Sarah Boyack's proposals into the climate change bill but, disappointingly, there was little detail. The Cabinet Secretary for Finance and Sustainable Growth has repeatedly told the Transport, Infrastructure and Climate Change Committee that he has been considering not whether but how to integrate her proposals into the climate change bill. By this stage, we should be hearing more about the detail rather than about another delay in the bill's introduction.

Alex Johnstone explained how influential Sarah Boyack has been in helping to write the Conservative manifesto. That may not have been her intention at the time but I am sure that we are all in favour of sharing. He also focused on the win-wins. Energy efficiency is not just about climate change and fuel poverty; energy efficiency measures would be worth implementing even aside from those issues. The green-collar jobs that could be created from an energy efficiency programme will be necessary in the current economic climate.

Alex Johnstone also asked about the price tag. On infrastructure investment, we have a range of priorities. I might suggest that we repair the Forth bridge instead of building another one, which could save £3.5 billon or £4 billion. There is room in the budget, if we are willing to consider the priorities. Investment in our domestic and energy infrastructure is a priority. The Greens' amendment calls for a comprehensive and fully funded programme and asks the Government to consider what can be done. That is all our amendment seeks to do and I commend it to Parliament.

Iain Smith (Liberal Democrat, North East Fife)

I got slightly excited there—I am used to the Liberal Democrats starting the summing-up process.

I welcome the debate. I, too, congratulate Sarah Boyack on her work on the energy efficiency and microgeneration bill. She could be seen as a leader in that area; her thinking about the direction that this country needs to take—on not just the environment but the economy—has come very much to the fore. So far-sighted is it that even the Conservatives have caught up and have recycled some of her proposals in their manifesto. I welcome that, too.

There have been some valuable contributions to the debate. Robin Harper talked about the need for investment in energy efficiency and the return that we would get from that. He made an important point about how reducing VAT on house improvements could provide a big boost, not just for energy efficiency but for the economy. I hope that that will be considered by the UK Government in its pre-budget statement.

There has been an outbreak of consensus among members today and support throughout Parliament for Labour's motion. As my colleague Liam McArthur said, the Liberal Democrats support the principles behind the energy efficiency and microgeneration bill and look forward to its progress through Parliament. It is widely recognised that Scotland's housing stock falls woefully short of the energy efficiency standards required to cope with not just climate change but Scotland's climate. I agree with Rob Gibson about the need for new housing standards to be developed. House-building standards today are not yet adequate and the Government needs to move more quickly to develop better building standards to ensure that energy loss in new houses is minimised or eliminated.

We also need to address the existing housing stock. Many local authorities, including the one in my area, Fife, are to be congratulated on the actions that they have been taking over a number of years to improve the insulation and energy efficiency of their stock, although more still needs to be done to tackle the issue. However, it is perhaps in the private housing sector that we need to do more. Retrofitting has become the new buzzword—it is mentioned all the time—but it is essential that we retrofit our housing stock to reduce energy loss and to cut emissions and fuel bills. Further, by replacing some of the many jobs that are being lost because of problems in the housing market, that would provide a much-needed boost to our hard-pressed construction industry.

The Government's six-point plan refers to the need to boost the economy and talks about intensifying work on energy efficiency and fuel poverty. While that would be welcome, to date there has been no detail on it. Perhaps when he sums up the Minister for Communities and Sport will give us more detail on what is intended, as no extra money has been committed in the budget to deliver that. The Economy, Energy and Tourism Committee tried to get information about changes to the budget lines but none was forthcoming. Indeed, the draft budget for energy and telecommunications, which is the area that deals with energy efficiency, and microgeneration and other renewable technologies, will be cut by 1.5 per cent cut in cash terms—a more significant cut in real terms—between this year and next.

We welcome the additional £10 million for central heating, but that is in the context of a budget that is falling in real terms year on year, as it has been fixed in cash terms since 2007. New, efficient central heating is welcome, but that is not all there is to it. We need to ensure that all houses are insulated, so that people can afford to pay for the energy, and that affordable-to-heat, not just affordable, housing is available. Perhaps the Government will consider transferring some of the £100 million for affordable housing into retrofit housing.

I hope that the Government considers the technologies that are available. I have written to the minister about the problem of getting grants for installing air source heat pumps—perhaps that can be addressed urgently. We need to do everything that we can to reduce carbon emissions.

Gavin Brown (Conservative, Lothians)

This has been a fairly good and consensual debate. I hope that the ideas that have been proposed will give ministers food for thought as they decide how best to progress matters.

Energy efficiency and microgeneration provide a clean, safe and comparatively cheap way of meeting our climate change commitments. A constituent—who may be related to one of the people who wrote to Alex Johnstone—said to me recently that energy efficiency is just

"a load of eco bling".

Although it tickled me slightly, I am sure that members would disagree strongly with that statement.

There are long-term benefits from energy efficiency and microgeneration not just for the environment but for householders. Cavity wall insulation, for example, pays for itself over several years. It gives a householder a warmer house and at the same time cuts down on carbon dioxide emissions. As a whole, it has grown well in recent years. In last night's members' business debate, we heard about actions taken by Community Energy Scotland, which is based primarily in the Highlands but is moving south as we speak. CES has grown well because of the actions of a number of people.

We have pretty close to a cross-party consensus but, as the Energy Saving Trust has pointed out, it is frustrating that while we consider the great progress that has been made over a 10 or 15-year period on the energy efficiency of certain household appliances, such as refrigerators and washing machines, it is possible in the space of a matter of months to invent a television that consumes double the power and has a standby button so that is never switched off. Despite all the progress that has been made, with one or two small inventions we can easily go backwards and depart from the trajectory that we have been on.

What gives me hope, though, is that the technology is adapting quickly and constantly. A couple of weeks ago, I had a flick through TIME magazine. Of its 50 top inventions of the year, three related to microgeneration. I am still struggling to get my head around one of them, which is described as airborne wind power. Another is a biochemical energy harvester. However, the one that impressed me most, and which should be coming to our shores soon, is Nanosolar's thin-film solar panel, which is much lighter and cheaper than previous solar panels. It can practically roll off the assembly line, which addresses one of the problems with solar power in the past.

I was struck by a comment in the consultation prior to Sarah Boyack's bill:

"Micro-generation will not become mainstream technology until they are easily accessible by householders across Scotland."

That hits the nail on the head. We must consider carefully the financial burdens and the start-up costs. That is a large part of the reasoning behind the Conservatives' eco bonus scheme for householders and small businesses, which Alex Johnstone referred to.

We must consider not only the regulatory issues but education—showing people, first, why energy efficiency is so important and, secondly, how it can be done. Most people are probably persuaded of the why but do not know as much about the how.

The Scottish Conservatives support energy efficiency measures and microgeneration for households and businesses. They have the potential to reduce the cost of energy bills; they create warmer households and offices; they are sustainable; and, most important, they reduce Scotland's carbon emissions.

Stewart Maxwell (Scottish National Party, West of Scotland)

I thank Sarah Boyack and all other members for a thought-provoking debate. We all agree that energy efficiency and microgeneration have a critical role to play not only in helping us to achieve our climate change targets, but in helping us to tackle fuel poverty and contribute to Scotland's sustainable economic growth. Increased action at individual, community and business levels is essential, so we must ensure that we have in place the right incentives to drive and stimulate that action. Some interesting ideas have been put forward this morning; we will look into how we can use those to build on the work that we are already doing.

This year, we launched the new energy saving Scotland advice network, which helps consumers and SMEs to reduce their energy bills and their carbon emissions. We have also recently introduced a new dedicated personal at-home service to help householders to find the right energy-efficiency and microgeneration solutions. We are improving the advice that is given and have committed up to £13.5 million a year for the next three years to support uptake of microgeneration and community renewables—three times the funding that was provided by the previous Administration.

We are investing a further £2 million and are widening the scope of our small business loan scheme to include microgeneration. We also plan to re-launch the scheme later in the year with a more proactive and targeted marketing campaign. In addition, we are producing secondary legislation to exclude microgeneration investments from business rates. We intend that the legislation will come into force on 1 January 2009.

However, we must ensure that we are doing all we can to support Scots who face hardship this winter as a result of rising energy prices. In addition to the £45.9 million that we are already spending this year, we are providing £10 million for free central heating systems and, from next year, will expand the scheme to include families who most need help. We will shortly announce the actions that we will take in response to the recent recommendations of the Scottish fuel poverty forum, thus ensuring that our programmes are as effective as possible in tackling fuel poverty.

Patrick Harvie (Green, Glasgow)

I do not think that anyone criticises the programmes for doing the wrong thing; the problem is that they are just not doing enough. Does the minister acknowledge the evidence from the Scottish Renewables Forum, which tells us that even to reach the Government's 11 per cent renewable heat target we need to increase the number of installations from about 1,200 a year to 25,000 a year? Does he accept that a step change is required?

Stewart Maxwell (Scottish National Party, West of Scotland)

As I have said, we listen carefully to all suggestions that are made to us—not only those from inside Parliament, but those from expert bodies outside it. There is much more to do and we will make announcements soon, not the least of which will be on the action that we will take in response to the Scottish fuel poverty forum's recommendations and on the proposed climate change bill, which will be introduced soon.

We must ensure that newly built homes have low carbon emissions. The research that we have done for the next energy standards, on which we plan to consult during 2009, indicates that low-carbon technologies including microgeneration will be a routine element in meeting the new standards. That will provide a flexible approach that will allow developers and designers to incorporate the right low-carbon solution for the building.

I will try to answer a few of the questions that members asked during the debate. A couple of members asked when the report on the renewables pilot will be published: it will be published by the end of the November. Its publication has been delayed a little, but I hope that members will be interested in it. Some members have written to me about it, and I am sure that there will be a debate around what it suggests.

Sarah Boyack asked about the red tape around planning for microgeneration. The Government is making progress on the relevant Scottish statutory instrument, which we intend to lay before the Christmas recess.

The energy efficiency action plan was mentioned by several members. The Government said in response to consultation submissions that the proposed Scottish climate change bill will require Scottish ministers to produce an energy efficiency action plan that will be regularly reported on, reviewed and updated, so that is also part of our plans.

A couple of members tried to suggest that there is a decrease in spending on energy efficiency. That is not correct. It is important to note that the enterprise, energy and tourism budget does not reflect the total spend on energy efficiency across the Government. Efforts to intensify action on energy efficiency will be undertaken by spending in a number of portfolios including housing, fuel poverty, transport, waste and so on.

Another member asked about the EU deadline for the introduction of energy performance certificates, which is 4 January. The recent indications are that more than 400 people are already qualified to do that work, and a further 200 are in the pipeline. We expect that there will be sufficient capacity to carry out that work.

We welcome today's debate. It has provided food for thought on what more we can do to ensure that we meet our climate change, energy efficiency and fuel poverty objectives. I hope that we can keep building on the momentum and the consensus that we have achieved today. We look forward to the proposed climate change bill and the actions that all of us can take to ensure that we reach the 80 per cent target.

Lewis Macdonald (Labour, Aberdeen Central)

This morning's debate has highlighted some important aims and objectives that are shared among all the parties. It has also highlighted how much more needs to be done, although some important progress has been made. The £1 billion that was announced by Gordon Brown in September for action on energy efficiency throughout Britain offers a good framework for further action in Scotland. I am glad, too, that Scottish electricity and gas suppliers have responded positively to the opportunity to invest in energy efficiency measures and to work with communities to reduce carbon emissions and cut bills.

The community initiatives that were launched this week by Scottish and Southern Energy in Comrie and elsewhere, Scottish Power's support for warm zones in Aberdeen and Lanarkshire, and the commitment of Scottish Gas and other suppliers to work with Government on rolling out the community energy saving programme are all welcome signs of the willingness of energy companies to play their part. Further progress, however, does not depend simply on installing more insulation or more energy efficient central heating systems, important though those are.

My involvement with the sector goes back to the early 1980s, when I carried out a number of energy efficiency surveys for Save Cash Reduce Fuel, which was then a brand-new agency. SCARF has since gone on to draught-proof and insulate many thousands of homes throughout the north of Scotland. As other members have mentioned, Fife Council's housing insulation and renewables programme, which has been running since 1997, and Edinburgh's community energy project, which was established by Mark Lazarowicz, offer other excellent models of what can be done.

However, the success of past initiatives means that insulation investment must now be about homes that are harder to heat. That will require active engagement, both by the Scottish Government and local councils, if Scotland is to win a proportionate share of carbon emission reduction target expenditure and investment. It is also essential that established community projects consider microgeneration as well as energy saving. The Government, too, needs to act to support microgeneration.

I believe that the proposals in Sarah Boyack's proposed bill offer a clear route map for using Scotland's devolved powers to support small-scale renewable energy developments. Ministers have said that the proposed climate change bill will include measures to deal with such matters. They have also mentioned today their intentions in relation to microgeneration and business rates, which are welcome. Nevertheless, if they want to meet the need to cut carbon emissions and tackle fuel poverty, they should go further and follow, as far as they can, the directions that are set out in Sarah Boyack's proposed bill.

Feed-in tariffs are important—Stewart Stevenson acknowledged developments in that respect. They are important at the point at which a generator produces enough power to be able to sell the surplus to the grid. They offer certainty, a fixed price and a predictable return. However, long before that stage is reached, fiscal incentives to install renewable generation technology can make all the difference to the initial decision on whether to go down the route of microgeneration. Householders, like businesses, will consider doing so in the expectation that they will achieve long-term savings and reduce their carbon emissions, if there are short-term fiscal incentives to provide an early benefit and strengthen the business case for their so doing. That is why ministers should not fight shy of acting on that now, even if they hold to their expectation that they will change the local taxation system. As long as households, as well as businesses, are liable for a property tax of any variety, a tax rebate or discount is an effective and legitimate means of promoting greater energy efficiency and more renewable energy generation. Ministers should accept that now and, if the need arises in the future to adjust the mechanism, they can do so in the context of the reforms that will already have been put in place.

The Government could do other things to promote energy efficiency. For example, much needs to be done to implement the recommendations of the Scottish fuel poverty forum, to which others have referred. Energy advice and assistance should be provided to those who need it most.

Ministers must also make the right decision on permissible noise levels, which is an issue that is delaying their commitment to bring microwind turbines under the general permitted development regime. World Health Organization guidelines could readily be applied through the statutory instrument to which Stewart Maxwell referred. That should be done in such a way as not to put at risk the microgeneration manufacturing sector that we all agree should be supported.

Other things could be done. Aberdeen's award-winning combined heat and power scheme, which has been running for some years in my constituency, could readily be replicated elsewhere and bring benefits to other areas. Much could also be done to improve the energy efficiency of the existing housing stock. Over recent weeks, the Economy, Energy and Tourism Committee has heard from many witnesses who have highlighted the severe short-term difficulties facing the construction sector. They have called for Government action on retrofitting existing homes with up-to-date energy efficiency measures. Such action would allow ministers to deliver on their pledge of more action on energy efficiency and fuel poverty in the context of the current economic pressures. I hope that there will be a positive and urgent response on that.

Today's consensus is about the need to act; the responsibility to deliver those actions lies with ministers. If they act, they will, as they have heard today, have broad support.

Health Funding

Alasdair Morgan (Scottish National Party, South of Scotland)

The next item of business is a debate on motion S3M-2863, in the name of Cathy Jamieson, on health funding.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

All members say that they are proud of our national health service and that they want to see it not only survive but thrive. We know that the staff are the NHS's greatest asset. Every one of us has examples of staff members who have gone above and beyond the call of duty because they care passionately about patient care and the principles of the NHS. That loyalty and dedication was demonstrated time and again at last week's Daily Record health awards, which were attended by the ministers and many others, including me.

To do their jobs as they want to do them, NHS staff must be supported with the resources, time and working environment that enable them to put patient care first. However, the reality—in this year when we are celebrating the 60th anniversary of the NHS—is that the Scottish National Party's spending review has resulted in the lowest increase in health spending since devolution. Within that, individual health boards have received an even lower settlement. That would make things difficult enough, but the Scottish Government's additional demand for a 2 per cent efficiency saving means that, in reality, health boards are not just seeking efficiencies but are actively considering cuts. Let us be clear: no one is suggesting that we want any service to be inefficient. Of course we want resources to be focused on patient care. Indeed, NHS staff themselves are often the best people to offer suggestions on how the patient's experience could be improved and how waste could be cut out.

Although the SNP claims that it is providing record levels of health spending, in reality its spending review is providing significantly lower increases than were provided under the previous Administration, and than are currently being provided for the NHS by the United Kingdom Government in England and Wales. As a result, Scotland's historically higher spending per head, compared with England, is now due to narrow from £260 in 2007-08 to £89 by 2010-11. If that trend continues, we will be overtaken by expenditure south of the border by 2013.

Within that expenditure, the allocations to individual health boards have been given an average increase—

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Will the member give way?

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

I will finish this point.

The allocation to individual health boards has on average increased by only 3.2 per cent in cash terms, which is the lowest percentage growth within the health budget, which is set to grow by 3.9 per cent overall. Given a 2.7 per cent provision for inflation, boards have only 0.5 per cent growth for dealing with national priorities. Of course, they face the same issues that confront other parts of the public sector in the current economic situation. Along with the requirement for 2 per cent efficiency savings, it is clear that we are seeing an effect on front-line care.

Before the cabinet secretary retreats behind her usual call of "scaremongering" whenever proper scrutiny reveals things that she does not want to hear, let me just put on record what health boards themselves are saying—

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Will the member give way?

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

No. The cabinet secretary ought to listen to what health boards themselves are saying. An NHS Highland document states:

"There was an acknowledgement that efficiency savings alone would not be sufficient to address the deficit and as such this would mean consideration of issues that were previously thought to be scary or untouchable."

The cabinet secretary will have an opportunity to respond to that later.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

rose—

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

The cabinet secretary really should hear this—then, I will give way.

NHS Dumfries and Galloway reported that savings are necessary to deal with costs that have risen beyond budget levels in order to "maintain long-term stability", rather than to reinvest in front-line services.

NHS Ayrshire and Arran told us that its external auditor has highlighted the deliverability of the 2 per cent saving each year as a high-risk assessment. Although the board has made some savings in administrative services, savings in front-line services are around 1 per cent. The strategy of relying on administrative savings in the future was described as "doubtful".

NHS Tayside reported a high risk of failure to achieve cost-reduction targets.

NHS Forth Valley is making savings of £30m over a three-year period that

"will impact on direct patient services and on staffing levels".

NHS Shetland reported that it is reviewing nurse numbers, cancer care services and mental health funding in order to try to generate budget savings.

Only this week, we have received reports from NHS Grampian that show that it faces a requirement to save £26.2 million this year and a further £24 million in efficiency savings over the next two years. The board describes those pressures as arising from

"a relatively low level of uplift in our core funding allocation, and at the same time absorbing increases in pay costs, capital charges, drugs costs, and providing funding to enable service re-design."

In order to implement that, NHS Grampian is now instructing every department to cut 5 per cent. Those are not backroom savings or administrative savings but savings that will have an impact on front-line services, which is unacceptable.

Perhaps the cabinet secretary will respond to those points.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

I have a simple question for Cathy Jamieson. When Jack McConnell said before the election that every penny of additional resources would go to education and that health would have to "cut its cloth", what exactly did he mean?

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

I am surprised that the cabinet secretary has completely ignored the serious points that I have raised. She must understand that, if she wishes to be in government, she must take responsibility for what is happening on her watch rather than constantly hark back to the past. It is important that the cabinet secretary and the Scottish Government move away from what is becoming their hallmark—complacency. They do not listen to what people are saying, refuse to listen to how their policies are affecting people on the front line, refuse to accept that proper scrutiny involves highlighting concerns on which they must act and refuse to accept any responsibility for what is happening on their watch.

Other members will cover a wide range of issues about the impact on front-line services but, in summary, the reports that we have received from health boards make it clear that the efficiency savings will have an impact by cutting staff and services for our most vulnerable people.

I ask the cabinet secretary to agree to look at the situation urgently, to review the situation in all health board areas and to ensure that there are no cuts that will adversely affect the ability of our NHS staff to do their jobs. There must be no cuts that impact directly on patient care.

I move,

That the Parliament condemns the emerging cuts to frontline services in Scotland's health service as a direct result of the SNP's budget settlement, which provides the NHS with its lowest spending increase since devolution; notes with concern that NHS boards across Scotland are facing extreme financial pressure as evidenced by the comments of NHS Highland that it needs to find savings that "would mean consideration of issues that were previously thought to be scary or untouchable"; further notes that NHS Shetland is reviewing the number of nurses, cancer care services and mental health funding to generate budget savings and that the Director of Finance and Planning at NHS Forth Valley has reported that the size of the savings required "will impact on direct patient services and on staffing levels", and therefore calls on the Scottish Government to take urgent action to ensure that NHS boards receive sufficient funding in order that they are not forced to consider cuts to frontline services.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Today I want to address the facts, the dishonesty of Labour's position, Labour's complete lack of credibility, and the fact that Labour spectacularly misses the point.

First—the facts. Fact number 1 is that the NHS has considerably more money to spend now than it ever did under Labour. Over this year, and over the next two years, health board allocations will increase by £1.5 billion, even before we take into account additional funding for cutting waiting times, for tackling alcohol misuse and for other key national priorities.

Fact number 2 is that within the tightest budget settlement since devolution, health gets its fair share. Average increases of 4.2 per cent over the next three years are in line with overall budget increases.

Fact number 3 is that health under this SNP Government has precisely the same share of total Government spending as it did under the previous Labour Government. The budget that I inherited from Labour gave health 33.7 per cent of the total. At the end of the current comprehensive spending review period, the health budget will be 33.7 per cent of the total. If Labour's point this morning was that the total cake is not big enough, we might have found a point of agreement. However, I suggest that Labour members direct their complaints to their friends in London who decide the size of the cake, and that they join this Government in demanding a fair deal for Scotland.

Fact number 4 is that efficiency savings that are reinvested in front-line patient care are not "cuts". They are, in the words of Jack McConnell when, as First Minister, he first set a public sector efficiency target,

"sensible"

and

"for the good of public services."

Those were the hard facts.

Let us now consider the dishonesty of Labour's position. Perhaps unsurprisingly, it ignores two key facts that Labour desperately wants to forget but that everyone else clearly remembers. First, the 2 per cent efficiency savings that Labour complains about today, and derides as "cuts", would have been 3 per cent efficiency savings if Wendy Alexander, Labour's former leader, had had her way.

Richard Simpson (Labour, Mid Scotland and Fife)

Will Ms Sturgeon give way on that point?

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

No. Cathy Jamieson did not take an intervention, and nor will I.

Jackie Baillie (Labour, Dumbarton)

She did take an intervention.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

So she did. I will take an intervention.

Richard Simpson (Labour, Mid Scotland and Fife)

On a—[ Interruption. ]

Alasdair Morgan (Scottish National Party, South of Scotland)

I am sorry, is this a point of order, Dr Simpson?

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

I am taking an intervention.

Alasdair Morgan (Scottish National Party, South of Scotland)

Is this a point of order?

Richard Simpson (Labour, Mid Scotland and Fife)

Is it in order—

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

I am taking an intervention.

Richard Simpson (Labour, Mid Scotland and Fife)

On a point of order. Is it appropriate for Nicola Sturgeon to say that Cathy Jamieson did not take an intervention when she did?

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

I made a mistake.

Alasdair Morgan (Scottish National Party, South of Scotland)

Would Dr Simpson sit down? I am not responsible for what members say, by and large.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

I made a mistake about Cathy Jamieson and was therefore allowing Richard Simpson to make an intervention. I am sorry that he refused to take the opportunity.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

Will the cabinet secretary take an intervention now?

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

No, I want to go on to the second key fact that Labour wants to ignore. The 4.2 per cent annual increases in the health budget that Labour now derides as being too small would have been 0 per cent if Labour had been in charge. Let us remind ourselves of what Jack McConnell said before the election. He said:

"The additional resources—

including efficiency savings—

"will be committed to education. That will mean other budgets having to cut their cloth".

In other words, the health budget would have been cut under Labour.

What did Wendy Alexander and Jack McConnell have in common? Oh, yes—they both had Cathy Jamieson as their deputy leader.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

rose—

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

For Cathy Jamieson to stand here today and criticise the budget that has been set by this Scottish Government, when the policies that she supported would have led to swingeing cuts in the NHS, is rank hypocrisy.

Labour's position is wrong on the facts, it is dishonest and it lacks credibility. This Parliament has a fixed budget; that fact is not of our choosing, but of Labour's choosing. If Labour members want to argue now for more money for health, then they have some tough choices to make elsewhere. I will take Cathy Jamieson seriously when I hear her tell Rhona Brankin, who wants more money for education, not just that she cannot have it but that she will have to take a cut. I will take her seriously when she says that to all Labour members who ask for more money for this, that or the other every time they open their mouths. Until that happens, Cathy Jamieson and the Labour Party simply do not deserve a hearing on this issue.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

Will Ms Sturgeon take an intervention?

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

No.

Perhaps the worst thing about Labour's position is that it completely misses the point. What this Government puts into the NHS stands scrutiny by anyone. However, it is what comes out that matters; it is what the NHS delivers that counts.

I will close by reminding Parliament of just some of the improvements that we have seen in the NHS since the SNP took office—by reminding Parliament of what is happening on my watch, to use Cathy Jamieson's word: two major accident and emergency departments; four children's cancer hospitals; and four neurosurgery units. Maternity services at Vale of Leven hospital and Inverclyde royal hospital—which were facing the axe as a result of Labour cuts—are now safe with the SNP. A total of 5,000 more staff are working in our NHS, waiting times are at a record low and prescription charges are down and on the way out. The largest hospital in the history of the NHS has been built in the public sector without the use of the private finance initiative, and car parking charges, introduced by Labour, have been abolished by the SNP.

Those are but a few of the many achievements of this Government and the fantastic people who work in our NHS, and just a few of the reasons why Labour is no longer trusted on the NHS, and why the NHS is safe in the SNP's hands.

I move amendment S3M-2863.1, to leave out from "condemns" to end and insert:

"notes that the Scottish Government's spending plans are set against the background of the 2007 spending review settlement from the UK Treasury that represents the lowest increase for Scotland since devolution; recognises that the NHS has received a fair share of the financial settlement and that the Scottish Government is increasing spending on health in Scotland; further recognises that in this context it is right that the NHS should strive to make sure that resources are spent as efficiently as possible; commends the NHS's record in achieving efficiency savings linked to good quality care; welcomes the Scottish Government's decision to continue the practice whereby all efficiency savings generated by the NHS will be retained by the NHS for local reinvestment in frontline services, and condemns the Labour Party, which instituted efficiency savings while in government but has irresponsibly attacked them in opposition."

Cathie Craigie (Labour, Cumbernauld and Kilsyth)

On a point of order. I understand that the Presiding Officer has no remit over the ministerial code of conduct, but I ask that the cabinet secretary carefully look at the Official Report of today's meeting and consider her position under the code of conduct.

Alasdair Morgan (Scottish National Party, South of Scotland)

That is not a point of order, and I strongly counsel other members against attempting to make similar interventions.

Mary Scanlon (Conservative, Highlands and Islands)

Following the Punch and Judy show, we can now move to calm reflection from the Scottish Conservatives.

We welcome this debate on health spending, and I make no apology for focusing on NHS Highland. There is no single reason—or, indeed, excuse—for the financial pressures that the board faces. The reasons include NHS Scotland resource allocation committee funding, the inclusion of part of NHS Argyll and Clyde, pay rises, and increased fuel costs and other costs. I could go on. On current projections, the savings, or "cuts", of £36.6 million that are required over four years, have led the board to consider what were previously considered to be, as Cathy Jamieson said, "scary and untouchable" cuts.

Redundancies, freezing recruitment, and reductions in emergency admissions are but three of the 39 measures that have been suggested by NHS Highland in order to balance its budget. I would like to consider the background to that more closely.

When NHS Highland took over the Argyll part of the previous Argyll and Clyde NHS Board, the financial fault lines that had led to the previous board's large financial deficit were not fully known. What was known was that the funding per person in Argyll was £80 less per annum than the figure for Highland, despite Argyll's many remote islands. I want to ask the Cabinet Secretary for Health and Wellbeing whether she will examine the resources that are given to NHS Highland and consider whether the board has inherited responsibility for the provision of NHS services without being given sufficient resources.

NHS Highland is responsible for an area that covers 41 per cent of the Scottish land mass, including 30 islands. The restructuring that was brought about by the previous Government's intervention has led the board to conclude that

"the challenges and risks faced by NHS Highland were unprecedented",

even by NHS standards. The travel and communication issues of island communities and areas of supersparsity link with fragile economies to produce particular challenges for delivery of NHS services. I remind the cabinet secretary that that point was often raised by the SNP MSP Duncan Hamilton in the first session of Parliament.

Highland also faces significant consultant travel time and costs: out-of-hours services in Highland are five times more costly than those in urban areas, and specialist peripheral outpatient clinics and other facilities are required to provide NHS services.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

I acknowledge the points that Mary Scanlon makes, although I remind her that NHS Highland is represented on the NHS Scotland national resource allocation committee working group and the points can be raised there. In return, will she acknowledge that, during the current year and the next two years, NHS Highland will get an additional £86 million in its budget?

Mary Scanlon (Conservative, Highlands and Islands)

It will get an additional £86 million, but it is certainly facing "scary" cuts. It is important that we reflect calmly on the matter and consider the background. I think I am doing that responsibly.

If it is fully implemented, the NRAC formula, which is the replacement for the Arbuthnott formula, will lead to £21 million of cuts. I understand and welcome the fact that the NRAC formula is constantly under review, as the cabinet secretary said, but the fact remains that NHS Highland is facing £21 million of cuts, and that will remain so until the formula changes. NRAC, which was set up by the previous Administration and is accepted by the SNP Government, has led to an excess cost adjustment based on changes around hospitals and not on community data. It fails to take into account the remote, rural and island issues in health provision.

We support the reallocation of efficiency savings to front-line services. On recent visits to Orkney and the Western Isles, I was impressed by the joint working on asset and estate management, human resource management, maintenance and payroll systems. However, I ask the Government to encourage boards to introduce more integrated working, because economies of scale have the benefits of leading to greater efficiencies and reducing the need to cut front-line services.

My final point would also lead to savings for the taxpayer, NHS staff and patients. I mentioned it last week and I do not apologise for mentioning it again. Personnel departments should do much more to manage staff who are sitting at home for months and years and get them back into work.

We are minded to support the Government's amendment, but we will reserve judgment until we have heard the SNP's contributions to the debate. We cannot support the Labour motion because the Labour Party must take some responsibility for the NRAC cuts, for the dissolution of NHS Argyll and Clyde, and for the closure of accident and emergency departments.

Ross Finnie (Liberal Democrat, West of Scotland)

I am sure that, even after the time for which we have been on our feet, there are patients out there somewhere whose care we must be concerned about.

The Liberal Democrats find this debate a slightly strange one in some ways. There are issues about where within the health budget one ensures that front-line services are secured, and there are points in the Labour motion that must be addressed, but I say to Cathy Jamieson that if we have learned anything in the past five weeks it is that growth has come to an end. Indeed, we were in error to believe that growth would go on for ever. The idea that, somehow, there is a pot of money that can be endlessly tapped for public expenditure is not one that I would wish to pursue. On the other hand, I say to Nicola Sturgeon that, although she is right to say that the Government is spending more money, the central issue is whether front-line services are being protected.

The Liberal Democrats fundamentally disagree with the simple statement that the principle of having an NHS Scotland resource allocation committee formula is wrong. Members are entitled to go to NRAC and have explained to them what the formula is and what it means. Under the NRAC formula, there will be winners and losers because it reflects the rurality of areas, deprivation, and other indices. We cannot simply have everyone getting the same. If one objects to the fact that those factors are taken into account, that is a matter of principle, but I do not think that criticising the NRAC or Arbuthnott formulas in principle is sustainable in dealing with front-line services.

Mary Scanlon (Conservative, Highlands and Islands)

I do not object to the use of a formula, be it Arbuthnott's or NRAC's. What I object to is the fact that the NRAC formula does not take into account remoteness and rurality, community data, or supersparsity. That is reflected in lower settlements for certain areas.

Ross Finnie (Liberal Democrat, West of Scotland)

My point is exactly that that is not what NRAC said when it gave evidence to the Health and Sport Committee on the way in which the formula works.

The fundamental issue is the conundrum that is before us this morning. The Cabinet Secretary for Health and Wellbeing appeared before the Health and Sport Committee on 29 October. I refer to columns 1207 and 1209 of the Official Report. At that meeting, she was pressed—indeed, I was one of those who pressed her—on the rate of inflation that health boards are experiencing, but she did not provide a figure. Having narrated the various pressures and stated that some of them are difficult, she concluded that the health boards are managing them. She went on to deal with efficiency savings, reporting not just that the health boards are achieving the planned savings but that they are likely to exceed them by £60 million, taking the savings to £277.08 million. As she did this morning, she made the point that the efficiency savings are reallocated to front-line patient care. That is fair enough.

The clear inference to be drawn is that front-line services are not affected when boards make and apply the savings. If that is the case, however, the cabinet secretary or the Government must address at some point in the debate the fundamental points in the Labour motion about what NHS Highland, NHS Shetland and NHS Forth Valley are saying. With all due respect, their claims that they are being badly affected do not square with what the cabinet secretary says. I take what she says in good faith, but it is of concern that, in the current, difficult circumstances, health boards that are responsible for delivering care to individual patients are not satisfied.

The Parliament is entitled to ask the Government how it squares the two positions, because there is a clear gap between them. We need an answer. Like Mary Scanlon, I will be interested to hear how the Government squares the two positions, which at present seem irreconcilable.

Jackie Baillie (Labour, Dumbarton)

In the short time that is available to me, I will deal with the assertions in the SNP amendment. The politics of assertion that is practised by the Cabinet Secretary for Health and Wellbeing is no match for facts and evidence. Her statements hide a very different picture.

The SNP's first assertion is:

"the NHS has received a fair share of the financial settlement and ... the Scottish Government is increasing spending on health in Scotland".

Now for the real facts as opposed to Nicola Sturgeon's spin. The Scottish budget is rising by 1.8 per cent in real terms, but the SNP's allocation to health boards is only 0.5 per cent, so the SNP has chosen to spend less. This, at a time when spending is rising at a higher rate south of the border. Allocations to individual health boards are also poor, at only 3.2 per cent, and with inflation outstripping the provision of 2.7 per cent, there are real pressures.

Indeed, the rate of increase in funding for the NHS in Scotland is so low that we need to go back to the days of Michael Forsyth in the Scottish Office to witness anything comparable. I seem to recall that his nickname was Scissorhands, because of the cuts over which he presided.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Overall spending is low as well, and responsibility for that lies elsewhere. I assume that Jackie Baillie does not really misunderstand health spending, so I have to conclude that she is being disingenuous. Will she confirm that, over and above the basic health board allocations that she mentioned, significant additional resources—from the money that is retained by the health department centrally—are allocated to health boards for key priorities? She should be accurate in what she says in the chamber.

Jackie Baillie (Labour, Dumbarton)

That was more of a speech than an intervention. I point out to Nicola Sturgeon that I expect her, as the minister in office 18 months on, to reflect the circumstances and the economic climate that is causing the problems that health boards are experiencing.

I move on to SNP assertions two and three. The amendment proposes that we commend

"the NHS's record in achieving efficiency savings linked to good quality care".

On the face of it, who could disagree with that? However, freedom of information requests to health boards throughout the country show that cuts are being proposed to front-line services.

In my area, NHS Greater Glasgow and Clyde is making £42 million of cuts this year and £72 million next year. These real, tangible cuts are not just about reducing red tape; they will affect out-of-hours services, physical disability services and learning disability services. The board's finance director, Douglas Griffin, claims that drastic measures are needed because the funding provided by the SNP Government is "significantly lower" than it has been in previous years. Moreover, as Mary Scanlon pointed out, NHS Highland is talking about making painful spending cuts, including considering options that were once regarded as "scary or untouchable" because

"efficiency savings alone would not be sufficient to address the deficit".

We have to stop talking about efficiencies; these are cuts that will happen to services in my area. In order to deliver savings beyond their efficiency targets, boards are cutting front-line services. The SNP's assertion that giving the NHS the ability to retain its 2 per cent efficiency savings is somehow doing it a favour is on the one hand laughable and on the other stunningly complacent. These are real cuts to real services and they affect real people. I am also disturbed to find growing evidence that capital savings are being used to underpin revenue. Such an approach only stores up problems for the future.

Finally I want to nail the SNP's defence that, because the previous Government instituted efficiency savings, they are not necessarily a bad thing. A 1 per cent efficiency saving—half the amount demanded by the SNP—in the context of considerably higher year-on-year funding increases to health boards is simply not comparable to the current situation. At that time, services were growing; in the current economic climate, they are being cut. The cabinet secretary is in the driving seat. She cannot deflect blame on to others. She has the power to ease the problems faced by the NHS in Scotland and I ask her to consider suspending these efficiency savings. If she does not, one can conclude only that the legacy of Michael "Scissorhands" Forsyth is alive and well in the corridors of St Andrew's house.

Stuart McMillan (Scottish National Party, West of Scotland)

The speeches so far have been, to say the least, interesting and robust. I did not expect anything less.

With its scaremongering and attempts to strike fear into the hearts of the Scottish public, new Labour's motion is a typical example of its negativity. If the public listen to its nonsense, they will think that Scotland is some third-world country, constantly in-fighting, and that we are too small, too stupid and too insignificant. I know that Scotland is not too small, stupid or insignificant to matter and that it is moving forward with an SNP Government.

Some of the SNP Government actions that deserve welcome include record health board funding, which will rise to £11.5 billion in this spending round; the approval of a new southern general hospital, which will be built not through public-private partnerships or PFI but with £842 million of public investment; an extra £40 million for free personal care, a policy that was short-funded by the previous new Labour and Liberal Democrat Executive; and the policy of reinvesting 2 per cent efficiency savings in the NHS and not, as new Labour promised during the 2007 election campaign, transferring them to other budgets.

Duncan McNeil (Labour, Greenock and Inverclyde)

Does the member not agree that the cuts being made by NHS Greater Glasgow and Clyde, which amount to £42 million this year and £72 million next year, will have a devastating effect on front-line services? Will he join me in making representations to the Cabinet Secretary for Health and Wellbeing for a review of the situation?

Stuart McMillan (Scottish National Party, West of Scotland)

What I will say is that, compared with what happened under the previous Labour and Liberal Democrat Executive's cuts agenda, the NHS is moving forward under the SNP Government. I could highlight many more positives for the NHS in Scotland under this Government—indeed, the cabinet secretary did so earlier—and long may the situation continue.

If new Labour had been in power, its cuts agenda would have amounted to £771 million, which is 50 per cent higher than the sum that will be achieved by the SNP's efficiency savings. Although the SNP Government has been accused of being draconian in introducing 2 per cent efficiency savings, I point out that, in May 2007, Wendy Alexander criticised the SNP for lacking ambition in not insisting on the 3 per cent efficiency savings that she and new Labour wanted and that were in line with the United Kingdom Government's policy.

I commend the SNP Government on certain actions over the past 18 months. First, I say well done for scrapping car parking charges at NHS hospitals. That tax on the sick was introduced on the previous new Labour and Liberal Democrat Executive's watch. I also say well done for keeping open Monklands and Ayr hospitals' A and E units, which had been threatened with closure by the new Labour—

Pauline McNeill (Labour, Glasgow Kelvin)

On a point of order, Presiding Officer. The member cannot continue to misname the Scottish Labour Party as new Labour. Surely we are entitled to our proper title in this chamber.

Trish Godman (Labour, West Renfrewshire)

That is not a point of order.

Stuart McMillan (Scottish National Party, West of Scotland)

Branding is everything.

Finally, I say well done to the Government for instigating the independent scrutiny panels that recommended that the community maternity units at Inverclyde Royal hospital and the Vale of Leven hospital be kept open. Consultant services that were cut on the watch of the previous new Labour and Liberal Democrat Executive have been secured under this SNP Government.

While we remain part of the union, Scottish Administrations will continue to receive the block grant. Last year was no different—apart from the fact that the money came a couple of months late, which had a knock-on effect for public services. When we received the grant, inflation stood at 2.7 per cent; it is now a massive 5.1 per cent. That will have an effect on public bodies and the best thing that they can do is to manage their resources as effectively and efficiently as possible to get through a financial mess that has been aided and abetted by the UK Government.

Given that the Scottish Government has limited financial powers and no power whatever to deal with inflation, any increase in spending in one department will mean taking resources from another budget. Until such time as Scotland gets the powers to deal with its economy and does not have to rely on the whims and mismanagement of London governments, we will always find ourselves in a restricted position.

As I said, the motion is typical scaremongering nonsense from the Opposition and I urge the chamber to reject it this afternoon.

Rhoda Grant (Labour, Highlands and Islands)

This debate is extremely important. After all, we must remember that health cuts will affect every one of our constituents. We thought, for example, that we had seen the last of long waiting lists, but I fear that that is not the case. That is not scaremongering—it is fact.

What good is it for someone to have a free car parking place if they cannot get a hip replacement? Their free prescription might cover the cost of their pain-killers, but they will not get their life back. What good is being able to vote in health board elections if a person cannot access health services? I am not criticising those initiatives; they have been popular and, if they were affordable, I would welcome them whole-heartedly. However, it is difficult to welcome the icing when there is no cake.

Shona Robison (Scottish National Party, Dundee East)

Will the member explain why, despite her comments, NHS Highland's chairman Garry Coutts has said that the savings

"will not affect outcomes for patients. Patients might see the way that they get services is different, but waiting times are going to come down, cancer waits are going to come down, the length of time you wait for a consultant is going to come down"?

How does that comment square with Rhoda Grant's scaremongering?

Rhoda Grant (Labour, Highlands and Islands)

Although I have some confidence in NHS Highland's attempts to mitigate the effects of these budget cuts, I do not think that it will be able to mitigate them in full. Indeed, that is why it is talking about looking at "scary or untouchable" areas. The minister should consider those comments as well.

Given that resources in this area are scarce—we have been told just how scarce they are—it seems ludicrous to spend valuable money on measures that deliver no health benefits. Since the implementation of the NRAC formula, rural health boards have lost out in the allocations that have been made. We are not criticising the need for a formula; however, when the Health and Sport Committee took evidence on the resource allocations, it became very clear that the formula being used was damaged, because the data on which it was based had no bearing in reality. For example, as Mary Scanlon pointed out, the cost of the out-of-hours GP contract shows that it is much more expensive to deliver rural health services, but the Government has ignored that information.

Health service staff are happy to be efficient, want to make changes and want to work hard to find savings. However, they want the savings that they are being asked to identify to be put back into patient care. If working harder and making savings do not improve such care and instead have a huge impact on morale, where is the greater good? NHS Highland is looking at having to make £36.6 million in savings, and it has said that it is not able to do so.

Alasdair Allan (Scottish National Party, Western Isles)

Will the member give way?

Rhoda Grant (Labour, Highlands and Islands)

No—I am running out of time and have a lot to cover.

NHS Shetland has reported that it is reviewing the number of nurses, cancer care services and mental health funding to find savings. Patients in Shetland have to travel far enough to access specialist care and any cuts that their board has to make will only disadvantage them further.

In its election manifesto, the SNP promised a major expansion of the health service, which was to be funded by efficiency savings in bureaucracy and backroom functions. The released resources were to be invested in front-line services. However, that has not happened. Indeed, the Scottish Government has written to NHS Shetland to ask it to deliver the financial outcomes that are included in its plan by holding a clinical review assessment as opposed to a backroom review assessment. We are talking about clinical services and front-line patient care.

No matter how the Government tries to dress things up, NHS Highland has had to revise its budgets because it has less money than it expected to receive from the previous Executive. NHS Shetland is considering the services that it delivers and the number of nurses that it employs. So much for investing in front-line services. The Government needs to act now and give patients access to health services that they deserve.

Keith Brown (Scottish National Party, Ochil)

It has become quite fashionable of late for certain politicians to talk about serious times requiring serious people and serious policies, but Labour's—or should I say new Labour's—motion for this debate, unlike its motion for the previous debate, is shot through with inconsistency, hypocrisy and doublethink. It is anything but a serious attempt to question health budgets. At its root, it seeks to put forward a case that health budgets are being cut and that the Labour Party would do something different if it were still in office. Neither proposition stands reasonable scrutiny.

The best antidote to cant and posturing is the application of hard facts, although I realise that for the new Labour Party at least, the facts are difficult. First, Cathy Jamieson's motion refers to the

"lowest spending increase since devolution",

but it pointedly avoids referring to the fact that the health settlement was made in the context of the lowest spending increase to the Scottish Government under devolution. That is a relevant point. If new Labour is to treat the issue seriously, it should recognise that the massive cut in the Scottish budget's rate of growth has an impact on health funding. It cannot then reasonably complain that separate budget heads are not increasing enough; that is simply not a serious point to make.

Perhaps that awkward fact could be overcome if new Labour—which, I presume, would have received the same settlement if it had clung to power last May—said that it would have cut other budgets in order to grow the health budget by more than the cabinet secretary has done, but we know that Labour would have sacrificed all other budgets in order to boost education. That is a legitimate aspiration, but it is not legitimate to pretend that it would not have impacted on the health budget. Aside from favouring education over health, Labour would have increased the efficiency savings that the Scottish Government asked of health boards by 50 per cent—that is Wendy Alexander's position and no Labour member has yet acknowledged it—and then turned those savings into cuts by taking them from health budgets and putting them into education.

That takes us to the crucial issue of efficiency savings versus cuts. Anyone who had to contend with the Labour-Liberal efficiency savings that were imposed on Scottish local government during the long, dark years from 1997 to 2007 is well able to tell the difference between efficiency savings that are redirected into the services that produce them and new Labour cuts that involve taking money from those services—as it was taken from local government—and redirecting it to other priorities.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

Does the member want to consider the facts as reported by Forth Valley NHS Board? It has said that, to balance the books, it must review children's and women's services in this financial year. It is talking about cutting resource transfers to councils in 2009-10, and schemes worth £48 million will be under review. Surely that is a fact and surely the member is concerned about it.

Keith Brown (Scottish National Party, Ochil)

I met Forth Valley NHS Board recently. It has given no indication that the efficiency savings that it is currently making are any different from what Labour previously proposed. In fact, it will get an extra £17 million over the three-year period.

Arguments are reinforced by relevant examples. I cite as an example of a cut rather than an efficiency saving the Labour Party's recent scandalous decision in Clackmannanshire Council to cut school crossing patrols. That service will not come back; the money will not go back into it.

It is a depressing fact that Labour knows that it is not being serious. It knows that comparisons with England are false because of the fiddling with projections and actual spend to cut Scottish funding in the first place. It did not raise an ounce of protest about that. It was not concerned about the cut to the Scottish Government's budget. It knows that, given the choice, it would take money out of health budgets and it is well aware that the health budget was agreed following the stingiest-ever settlement from London. The fact that Labour did not oppose the Scottish Government's health budget is more depressing still. We all recall Labour's fantastically assertive and decisive leadership when it decided to boldly abstain—I am sorry for the split infinitive—on the budget last year.

It is apparent to everybody that there is no real principle, far less substance, in new Labour's motion. Such can be the stuff of opposition politics—that is fair enough—but the motion has nothing to do with a sincere and sustained commitment to higher health budgets.

I am not entirely sure what the Liberal Democrats' position is. However, if they want increased health funding, that will have to be added to the growing list of things for which they want to increase funding and must be seen in the light of the £800 million of savings that their tax-cutting programme would introduce.

In conclusion, Labour politicians should listen to one of their own. These are serious times that call for serious people making serious proposals. Labour politicians misread the public's willingness to put up with puerile posturing at a time of rising economic distress. I am sure that Labour will not withdraw its stupid motion, but perhaps Labour members will think a bit more seriously before they submit another one like it.

Malcolm Chisholm (Labour, Edinburgh North and Leith)

The cabinet secretary made a typically robust defence of her budget, and I am sure that her debating skills and other qualities will win her the top award tonight. I am equally sure that she would have argued for more money for health at the time of the spending review and that she would have been disappointed not to have received it.

Her main defence was that the percentage increase for health was the same as that for the Scottish budget as a whole and that the percentage of the total budget that is going to health will remain constant over the spending review period. However, at a time when the overall budget is not increasing as fast as it has done in the past, there is a strong argument for increasing the percentage of money that goes to health. I will give an example. A year or two ago, if there was a 6 per cent overall increase in the Scottish budget, a 6 per cent increase in health funding would have covered health inflation plus a bit more, but if the overall increase in the Scottish budget is roughly 4 per cent, a 4 per cent increase in health funding as a whole will not cover health inflation and a bit more.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Malcolm Chisholm makes the legitimate argument that in days of smaller increases, we could choose to increase a particular budget disproportionately. To follow the logic of his argument, I presume that he is saying that we should have done that for health. Will he complete his argument by saying which budgets under the Scottish Government's control he would have cut to pay for that increase?

Malcolm Chisholm (Labour, Edinburgh North and Leith)

I will talk about that. I am not arguing for a massive increase in health funding; rather, a small increase could be made by finding more money from somewhere else and perhaps also by postponing the abolition of prescription charges. I support the abolition of prescription charges, but the cabinet secretary should at least consider postponing that in a time in which there is pressure on the health budget.

Members probably know the general facts about health inflation and how drugs, demography and so on affect it, so I will not go into that. However, health inflation and other factors mean that a 3.2 per cent funding increase is presenting boards with great difficulties. The cabinet secretary was lucky to inherit a strong financial position for the health service and, indeed, a strong health service in other ways—for example, the problem of non-recurring budgets had almost been stripped out of the system. Therefore, she had a strong start, but seven months into the new spending review period, she must listen to what boards are saying and respond in some way. I am not saying that she is or would be able to find large sums of money, but she should, in deciding the budget for next year, argue with her colleagues that a little more or some more money should be found for health, perhaps from another budget or by postponing the abolition of prescription charges.

Alasdair Allan (Scottish National Party, Western Isles)

Will the member confirm to the many patients who have benefited from the reduction in prescription charges that the Labour group's policy is that the proposed measure should be postponed and they should wait longer? Is the member speaking in a personal capacity or for the Labour group?

Malcolm Chisholm (Labour, Edinburgh North and Leith)

I am a back bencher now, so everything that I say can be taken as being said in a personal capacity. I responded to the point that the cabinet secretary made. She should consider other budgets—I am not putting things any more strongly than that—because she must respond in some way to what health boards are saying. The whole point of the debate is to put on the record what various health boards in Scotland are saying about the difficulties that they are facing seven months into the spending review period. We have two years and five months more of similar increases. The problem must be addressed.

I will make two final points. The big picture is not the total amount of health spending, but how that money is being spent. The general direction of health policy is to spend more money on community-based services. We need to try to track that money and ensure that more money in the budget is going in that direction. I was concerned that Audit Scotland's "Overview of Scotland's health and NHS performance in 2006/07" stated that there is no evidence of that shift taking place.

Today, we are talking about health budgets, but we must also monitor closely what is happening in local authority budgets. I will not go back over the debate about ring fencing, although I have concerns about that, for example on the abolition of the mental-health-specific grant. We must monitor closely the single outcome agreements and what happens to health-related spend in local authority budgets.

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

I usually start such speeches by saying that the debate has been consensual, but that would not be true today. Nice guy that I am, I find myself amidst the storms on either side of me.

Cathy Jamieson laid out her case pretty well. She rightly gave the NHS staff their proper place—they are our greatest asset. The fact is that we have one of the lowest increases in health spending since devolution. That is set against the fact that, as Ross Finnie pointed out, growth is no longer an option because of inflation and rising costs, to which Mary Scanlon referred, such as wages and fuel. The trouble is that the inflation graph may not even be a straight line—the increase could be accelerating. That would bedevil any Government's figures.

I am afraid that it is a fact that the health spending increase here is lower than that in the rest of the UK—we can substantiate that. Cathy Jamieson rightly referred to the situation in Highland NHS Board, which Mary Scanlon fleshed out. The chairman of the board has said that there is a £21 million cut and that the board may consider reducing emergency admissions. The fact that such comments have been put on the record by the chairman of the health board should surely concern each and every member who cares about front-line services. Mary Scanlon made two useful points. The first was about the Argyll pig in a poke. We do not know what price came with Argyll when it was added to Highland NHS Board, but that must be examined. I politely request the cabinet secretary to consider that, because it might be bedevilling the board's figures. Mary Scanlon's second important point was about people who are not working and staying in their houses when they could be put to work. That is an issue for personnel and it should be examined.

Nicola Sturgeon, who I am sure has a high chance of winning a prize at tonight's politician of the year dinner, put her case eloquently and well, as one would expect. Her rebuttal was about the increases in money and about Scotland not having a fair deal. We have allegation and counter-allegation. However, when anyone says that there is more money in the budget, that must be measured against inflation and rising costs. There might be an increase in pounds and pennies, but not in the trend of spending.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

My question is genuine and is not simply to make a party-political point, as I do not know the answer. Will the member explain what impact the Liberal proposal to take £800 million out of the budget to pay for tax cuts would have on NHS budgets?

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

No, I will not, because I am not here to discuss that. I am here to try to get the Scottish Government to accept that health boards out there are saying those things and that there really is a threat to patients. That is what we are talking about—the debate is not about hypothetical spending; it is about patients getting the services that they deserve. The Scottish Government must acknowledge that the issue is very serious.

When Jackie Baillie mentioned Michael Forsyth, it was as if Banquo's ghost had entered the chamber. He is almost unmentionable. One of Jackie Baillie's points has not been dealt with by other members, so I ask the cabinet secretary to address it. Jackie Baillie said that capital savings might be used to underpin revenue, which is a chilling thought. The chairman of Highland NHS Board has written to the cabinet secretary asking for capital funding for a new four-surgery dental facility in Thurso but, if Jackie Baillie is correct, it begins to seem as if that could be scuppered. My colleague Jackie Baillie has made a hugely important financial allegation, which must be answered, because the issue is crucial.

Richard Simpson (Labour, Mid Scotland and Fife)

Will the member give way on that point?

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

I do not think that I have time.

Trish Godman (Labour, West Renfrewshire)

You do have time.

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

I will certainly give way, then.

Richard Simpson (Labour, Mid Scotland and Fife)

From the replies that we received to our freedom of information requests, we have found that £42 million of property sales have been included in efficiency savings. Property cannot be sold more than once.

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

I accept that.

I am interested in who decides whether a member takes an intervention—the member or the Presiding Officer. However, I will give leeway to the Presiding Officer on that one.

Rhoda Grant mentioned car parking. That is not hugely pertinent to the debate, but it is fair to say that free car parking has been talked about in the Highland area as something that perhaps did not need to be given. However, that is a debate for another day.

We must remember that growth is not an option any more and that the pot of money is limited. The debate takes place against the background of inflation. We must therefore consider what has to be done to meet the threat of cuts or reductions in front-line services for patients in Scotland.

Jackson Carlaw (Conservative, West of Scotland)

In 18 months in the Parliament, I have not been called on to participate in a more bizarre or disingenuous debate, nor one that has conjured up such a profound sense of déjà vu. In opposition through the 1980s and 1990s, the weary and lazy refrain from Labour was, "Stop the cuts." In my first Westminster parliamentary election—a by-election in 1982—the Labour candidate challenged me to fight the cuts. When I asked to which cuts she was referring in particular, she replied, "I don't know about that, but what are you doing to fight them?" When the Labour candidate was finally confronted at a public meeting by a constituent who inquired why the local library closed early on a Wednesday night, she replied, "I have absolutely no idea, but I am sure it's Mrs Thatcher's cuts." Such childish rants did not win Labour power then, although, just as now, they may have helped it to retain a seat or two in by-elections. Finally, in the 1990s, Labour elected a new leader, who abandoned that shameless and lazy rhetoric and progressed an agenda that discarded almost everything that his party had fought for in the previous 18 years. Has Labour learned from that? Why, no. Battered in opposition, it falls back on the same old chants, as Pauline McNeill, no less, confirmed in an intervention. There is the same old opportunism and scare-and-smear tactics. What a shambles; what a sham.

Rhoda Grant (Labour, Highlands and Islands)

Will the member take an intervention?

Jackson Carlaw (Conservative, West of Scotland)

I am sorry, but I am too far gone on my hobby-horse to dismount.

How dispiriting that approach is when there are serious funding issues to discuss, as Mary Scanlon detailed at length on NRAC. Ross Finnie suggested what might have been a much more interesting debate. I excuse Malcolm Chisholm, too, as he made a typically intelligent and reasoned speech.

The irony of it all. At the top of the list of reasons why Labour was kicked unceremoniously out of office in Scotland last year was its contempt for the public mood on health. Labour championed the real health cuts—cuts in accident and emergency health services throughout Scotland—and the Government, with Conservative support, reversed even more damaging accident and emergency closures that were planned in Ayr and Monklands. When in government, Labour planned regressive cuts in the net take-home pay of nurses and health service workers through the introduction of its hospital car-parking tax, which, to paraphrase, was a tax under which even a consultant married to a duke paid the same as a nurse married to a binman. Annually, that tax was to be greater than the net increase in the average health worker's annual wage. The shame of it—the Labour shame of it. Again, the Government, with Conservative support, has abolished that disgraceful tax.

Labour is so desperate to find a strategy back from an emerging wilderness that out comes the old scattergun of scare and shame. I know that Labour, when confronted with today's reality check on its health record—which I freely admit is not entirely without merit—will react true to form. I can hear the familiar charge coming, so before Labour members gobble on their spittle, I remind them again of uncomfortable facts. Labour is the only party in history that, when in government, forced through real cuts in the health service. A generation ago, Labour cut nurses' pay by 3 per cent; doctors' pay by 16 per cent; surgeons' pay by 25 per cent; and overall health spending by 3 per cent.

The Labour chancellor, Scissorhands Darling, chose to change the health baseline for calculating the Barnett consequentials, resulting in a budget to the Scottish Government on health that is about £342 million less than it would otherwise have been. However, Labour has the brass neck to look in our direction when talking of threats to the Barnett formula. In the election last May, the Labour Party pledged that education would come first. The then First Minister said that other departments would have to "cut their cloth". I presume that that would have included health. That would have been on top of the efficiency savings that Labour advocated of 3 per cent, not 2 per cent, as we have now.

The time will come when the SNP Government has to account for its record. It has argued for a disastrous local income tax and has put the continuity of our electricity supplies at risk by dogmatic hostility to nuclear power as part of the future energy mix. However, on health, the cabinet secretary demonstrated in a magisterial performance why she is a shining beacon of hope in comparison with the tawdry arrogance of Scottish Labour. She is held in such regard that she may even rival Governor Sarah Palin in the esteem of Scots. That may seem like faint praise but, truly, it is not intended as such, for it was the Labour Government at Westminster that chose such a damaging basis for the calculation of Scotland's health service budget; a Labour Government in Scotland that proposed and partially implemented devastating cuts to accident and emergency services; and the Scottish Labour Party in government that forfeited the trust of the Scottish people. When the general election comes, Labour will get its just deserts. The most liberating cut of all will be the people's cut on the dead weight of the Labour Government at Westminster.

Labour's motion is shabby, opportunistic and shallow—indeed, it is contemptible. It is the motion of a small-minded party—from a front bench grey in spirit and character, led by a man grey in name. We will support the Government amendment at decision time, and be done with it.

Shona Robison (Scottish National Party, Dundee East)

How does one follow that? I do not think that I could be any nicer to the cabinet secretary.

I wish that the debate had been constructive, but it was based on a false premise and opportunism. I will start with a little list—actually, it is quite a big list—of spending commitments that the Labour Party has made during the first 18 months of this SNP Administration. The list, which amounts to just over £0.5 billion, covers areas such as buses, student funding, apprenticeships in the creative industries, Scotland's sports ambassadors fund—a proposal from Cathy Jamieson—and pledged support for higher bursary funding. All those things add up to a fair bit of money.

Labour members stood before the chamber this morning demanding more money for the health service, yet they did not, of course, specify where the money would come from. Labour member after Labour member, in every speech, failed to give an indication of which budget they would cut to fulfil the party's desire for higher health spending. That is not worthy of an Opposition party, let alone a party that wishes to be in government again. Labour members cannot come to the chamber and tell the Government what it should be doing without putting forward any solutions.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

Does the minister accept that the health boards are saying that they face the pressures that we raised in the debate? Will the cabinet secretary and the minister, at the very least, take that seriously? Will they take away the information, look at it and report back to Parliament at a later date? The SNP has said that this side of the chamber is scaremongering, but we are not. The words that we used are those of the health boards—the boards are saying that patients will suffer.

Shona Robison (Scottish National Party, Dundee East)

Cathy Jamieson did not offer up any answer to the question: where is the money to come from?

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

That is the minister's job.

Shona Robison (Scottish National Party, Dundee East)

No; when the Opposition calls for extra spending, it is the Opposition's job to tell us what budget cuts it will make to fund that spending.

I return to Cathy Jamieson's misinformation and selective quoting. She said that NHS Shetland is making cuts in cancer services, but the fact is that NHS Shetland said:

"One-off savings achieved by the Board include vacancy savings in a nursing post. No services have been withdrawn and these specific savings total £10k.

Absolutely no savings have been made in Mental Health."

Saying that savings would be made in mental health services was another piece of Opposition misinformation from Cathy Jamieson. That is only one example; there are many more that show the level of misinformation, opportunism and selective quoting that Cathy Jamieson used in introducing this shoddy debate.

Gary Coutts, the chair of NHS Highland made his position on the savings clear. I repeat:

"It will not affect the outcomes for patients. Patients might see the way that they get services is different, but waiting times are going to come down, cancer waits are going to come down, the length of time you wait for a consultant is going to come down."

What a different picture he paints from the scaremongering about people dying—I think that that was what Rhoda Grant said—because of what were described as cuts to the health service. That is unacceptable language for any member to use about our hard-working staff in the NHS. Such language would not be good enough for members on any side of the chamber, but especially not for a member of a party that has been in government. Labour members should know better; they know about managing budgets.

I need say nothing more on the misinformation in Cathy Jamieson's speech, other than to repeat that it was misinformation.

I turn to Mary Scanlon's speech. I reiterate the point that, given that NHS Highland is on NRAC, it will consider issues including the future funding formula, which Mary Scanlon raised. Of course, joint working with the island boards is very important in making more efficient use of the services that they provide.

Mary Scanlon (Conservative, Highlands and Islands)

I remind the minister that the funding for someone who lives on Coll or Tiree is around £700 less than for someone who lives on Barra in the Western Isles. That is an example of the funding differences that Highland NHS Board faces.

Shona Robison (Scottish National Party, Dundee East)

That is one of the very issues that NRAC will look at in taking forward the important piece of work with which it is tasked.

Ross Finnie made an interesting speech, some of which was reflective. As always, he said some interesting things. However, he cannot get away from the fact that the efficiency savings that will be made will be reinvested in front-line services. We have made that very clear from the outset. If Ross Finnie does not want those efficiency savings to be made and if he does not believe that that is the best way to free up resources to reinvest, he has to answer the question: where will the £800 million of savings that his party advocates come from? It is not good enough for any member, on any side of the chamber, to demand more money from the Government without saying where the money should come from. It is also not good enough to advocate cuts but not to say where the cuts will fall.

I turn to Jackie Baillie. Frankly, she surpassed herself in opportunism today. She raised the issue of efficiency savings. Who was in charge in 2005-06? Oh, sorry—it was Jackie Baillie's Government; she might even have been a minister at the time. Efficiency savings under that Labour Government that year were £169,383. In 2008-09, under this Government, the savings are £158,129. Our efficiency savings are less than those that were expected or made under the Labour Government.

Jackie Baillie (Labour, Dumbarton)

Will the minister give way?

Shona Robison (Scottish National Party, Dundee East)

I am in my last minute.

Jackie Baillie said that we should scrap efficiency savings, but yet again she gave no indication of where that money would come from. That is not good enough. No Labour member other than Malcolm Chisholm had the guts to offer up suggestions. He suggested that the abolition of prescription charges should not go ahead. No other Labour member had the guts to tell us where alternative savings should be made. Labour is not worthy of opposition, never mind government.

Richard Simpson (Labour, Mid Scotland and Fife)

Like Jamie Stone, I would have liked to welcome the debate as constructive, but this has been one of our least constructive debates. I say to our Conservative friends that I did not recognise the two Conservative speeches as coming from the same party. Mary Scanlon rightly talked about the problems that NHS Highland faces, but Jackson Carlaw mounted his hobby-horse and disappeared into the far distance.

Serious issues are involved; Ross Finnie, Malcolm Chisholm and other members raised them in their speeches. The Government—and the SNP is the Government—made the decision in the comprehensive spending review to cut revenues by £1 billion. I hope that the cabinet secretary and the minister accept that. The SNP Government decided to cut revenues in a variety of ways. As a result, it has £1 billion less to spend on public services. Our public services have to take the strain of that reduced revenue.

That would be fine if the settlement to health boards reflected the allocation that Scotland has been given, but it did not—it is the lowest uplift since devolution. The SNP Government also failed to recognise the new situation of increased inflation and the fact that health service inflation always outstrips ordinary inflation. Furthermore, it failed to lay out clearly what should be included as so-called efficiency savings and what should be proscribed as cuts.

There are some incontrovertible facts in the debate. The SNP Government's budget was increased by 1.8 per cent in real terms. However, based on headline inflation of 2.7 per cent, the real-terms uplift in the Government's general allocation to health boards was 0.5 per cent. The Wanless King's Fund report stated that the NHS needs an annual increase of 4 per cent in real terms just to stand still, and in England Labour has provided the necessary uplift to achieve that, even though it, too, is faced with the new situation of higher inflation.

It is true that, on the calculations that we have been given by economists, our per capita health expenditure is on a trajectory to go below that of England by 2012-13. Labour in England is giving more to health than the SNP Government is giving in Scotland—that is a fact.

The special NHS inflationary pressures are recognised, and the Audit Scotland report demonstrates them: an ageing population; agenda for change; the European working time directive; new and more drugs, including a 4 per cent uplift in drug expenditure predicted for Grampian; and new and expensive technology. I would also include the need to clean our hospitals, as demonstrated by the audit report this week.

That is health inflation, but we must also consider general inflation. General inflation is not 2.7 per cent, as the headline inflation was, but considerably higher. If we consider fuel and food, which the NHS has to deal with, the level is even higher than the headline inflation of 5.2 per cent. Those are all realities that the cabinet secretary will have to face in the next year or so. We may be lucky—inflation may drop to zero and there will not be the same pressures in later years. However, for this year and next, the pressures undoubtedly exist.

Another incontrovertible fact, which disappoints me, is that both the cabinet secretary and the Minister for Public Health have said repeatedly that Labour is scaremongering, when the reason for the debate—I see Keith Brown nodding as well, although I welcome Christine Grahame as no other SNP member of the Health and Sport Committee has been present, which is a shame—

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Will the member give way?

Richard Simpson (Labour, Mid Scotland and Fife)

Time is short; I must get on. Anyway, the cabinet secretary refused my intervention, decided to take it and then messed around.

The Labour Party made a freedom of information request to every health board in Scotland on the efficiency savings that they were making and the pressures that their budgets might be under. That is a responsible approach for the opposition to take, and everything that Labour members have said today has been lifted from the reports that we have received from health boards. Nicola Sturgeon and Shona Robison might sit there, shaking their heads yet again, but are they saying that the health boards are lying to us in response to freedom of information requests? If so, they are making a dangerous assertion.

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

My central charge is about the deep dishonesty of the Labour Party. Will Dr Simpson answer the question that Cathy Jamieson failed to answer: what impact would there have been on NHS budgets under the Labour policy to put all resources into education and cut NHS funding? That is central to today's debate.

Richard Simpson (Labour, Mid Scotland and Fife)

I will not answer that question, because this debate is about the SNP Government facing the reports that we have received from individual health boards about the cuts that they are having to make.

Let me go into that point in more detail. We have heard about NHS Highland, which is talking about £10 million of cuts in addition to the efficiency savings. NHS Forth Valley has spoken about cuts of 1 per cent across the board, while NHS Grampian is having to consider a 5 per cent cut to balance its budget.

What are the efficiency savings, and will they affect front-line services? Shona Robison referred to dealing with vacancies—

Shona Robison (Scottish National Party, Dundee East)

It was one case.

Richard Simpson (Labour, Mid Scotland and Fife)

In Shetland, but I am talking about other areas. [ Interruption. ] Shona Robison may sit there and laugh, but the fact remains—

Nicola Sturgeon (Scottish National Party, Glasgow Govan)

Will the member give way?

Richard Simpson (Labour, Mid Scotland and Fife)

No, I will not take another intervention.

We have heard from a number of health boards that they will use a delay in filling vacancies to achieve efficiencies. Are the ministers really sitting there and saying, from a sedentary position—

Shona Robison (Scottish National Party, Dundee East)

Will the member give way?

Richard Simpson (Labour, Mid Scotland and Fife)

No, I will not. The minister is commenting enough from a sedentary position. Is she saying that the health boards are not delaying vacancies? [ Interruption. ]

Alex Fergusson (None, Galloway and Upper Nithsdale)

Not from a sedentary position, please, ministers.

Richard Simpson (Labour, Mid Scotland and Fife)

Is the minister saying that delay in filling vacancies is a reasonable way of achieving efficiency savings? Such delay puts pressure on front-line staff who have to cope without the consultant or nurse who has not been appointed. That is not an efficiency saving.

Many of the savings that were noted in the responses to us were one-offs, which are not efficiency savings. I will list them: property sales of £42 million; cuts in supplies, not improvements in procurement; capital to revenue virement reductions; accountancy adjustments; and freezing uplifts to budgets.

In summary, it is not Labour members who are saying that there are problems with efficiency savings; we are repeating the reports that we have had from health boards. The higher levels of inflation and the reports from health boards are serious issues that, as Ross Finnie said, need to be addressed seriously.

Question Time — Scottish Executive — General Questions

Christine Grahame (Scottish National Party, South of Scotland)

To ask the Scottish Executive what representations it has made to United Kingdom import agencies with regard to the importation of animal skins from Africa used in the manufacture of drums, in light of deaths from anthrax in Scotland and England. (S3O-4822)

Shona Robison (Scottish National Party, Dundee East)

The rules governing the importation of skins are set out in European Union legislation that has been transposed into domestic Scottish legislation. The legislation is enforced at points of entry by Her Majesty's Revenue and Customs and official veterinary surgeons. In light of recent events, the Scottish Government has written to Scottish importers reminding them of the import rules that are applicable to the products.

Christine Grahame (Scottish National Party, South of Scotland)

As the minister may know, the fatal accident inquiry into the circumstances surrounding the death of Borders man Pascal Norris is to commence next week. Does the minister share my concern that not enough lessons have been learned by UK import agencies in light of Mr Norris's death and the death in London? I do not want to pre-empt the FAI, but both deaths appear to have strong connections to contaminated and imported animal skins. What assessment has been made by the civil contingencies unit and Government health officials to prepare for—I hope that this does not happen—a possible outbreak of anthrax in Scotland?

Shona Robison (Scottish National Party, Dundee East)

We have reviewed the recommendations in the report with Health Protection Scotland and animal health officials. As Christine Grahame will know, the Public Health etc (Scotland) Act 2008 introduced new legislative controls to address issues that are faced during such incidents regarding access to property and other matters. We will review the need to take further action following the outcome of the fatal accident inquiry to which she referred. I am happy to keep the member informed of the discussions that my officials have on that matter.

Johann Lamont (Labour, Glasgow Pollok)

To ask the Scottish Executive when the Cabinet Secretary for Finance and Sustainable Growth last met representatives of the Equality and Human Rights Commission and what issues were discussed. (S3O-4788)

John Swinney (Scottish National Party, North Tayside)

I have not so far met representatives of the Equality and Human Rights Commission.

Johann Lamont (Labour, Glasgow Pollok)

I find that disappointing, and I urge the cabinet secretary to meet them as a matter of urgency, particularly on single outcome agreements.

The cabinet secretary may be aware that Morag Alexander, the Scotland commissioner, has said that the equality impact assessment is a requirement of the public sector equality duties, which are legally binding, and that it should be central to policy design, not policy review. In light of that, what advice did the cabinet secretary seek or receive from the commission on whether equality impact assessments are necessary for single outcome agreements? He is on record as saying that that is a matter for local government and local authority representatives have told the Local Government and Communities Committee that equality impact assessments are not necessary for single outcome agreements.

John Swinney (Scottish National Party, North Tayside)

I respect the considerable interest that Johann Lamont takes in equalities, which she has pursued both as Deputy Minister for Communities and in other aspects of her parliamentary activities. However, the formulation of single outcome agreements is properly undertaken by individual local authorities. There is a duty on each authority to ensure that it takes equalities issues fully into account in the formulation of its policy positions.

On Johann Lamont's specific question, I did not seek advice from the Equality and Human Rights Commission because I felt effectively advised on local authorities' legal responsibilities. I will monitor the situation as I monitor all aspects of the development of single outcome agreements in the policy process.

Sandra White (Scottish National Party, Glasgow)

In 2006, Tom McCabe, who was then Minister for Finance and Public Service Reform, said on a similar issue:

"We can do our best ... to mentor local government and to encourage it to reach agreements that will strike the balance".—[Official Report, Finance Committee, 21 February 2006; c 3419.]

Does the cabinet secretary agree with that? Does he agree that it is up to local government and not central Government to move equal pay forward?

John Swinney (Scottish National Party, North Tayside)

The issue of equal pay has been a significant part of the discussions that I have had with committees on the budget for 2009-

10. I took part in an extensive discussion on the issue with the Equal Opportunities Committee, in which Sandra White participated.

The issues of equal pay and single status are properly matters for local authorities. As Sandra White will know, the Government believes that local authorities must be given the freedom and the flexibility to carry out their duties and obligations. I am pleased that local authorities are now making further progress on tackling the issues of equal pay and single status, and the Government supports them in that work.

Marlyn Glen (Labour, North East Scotland)

Does the cabinet secretary agree that for equalities organisations—and, indeed, for the people of Scotland—it is essential that equality impact assessments are implemented in a timely fashion? Will he outline how he is monitoring single outcome agreements, for which he has ultimate responsibility, and will he issue an interim report on the progress that is being made towards meeting the equality duties, which are legal requirements?

John Swinney (Scottish National Party, North Tayside)

I consider the progress of single outcome agreements on an on-going basis. Many members told me that it was not possible to put in place single outcome agreements by April 2008 and, not for the first time, they were proved wrong. The single outcome agreements are in place, and a fresh set of agreements will be formulated by community planning partnerships, which will involve local authorities, in April 2009. The Government and the Convention of Scottish Local Authorities are working together to monitor single outcome agreements and to advise authorities on the approach that they should take.

I point out to Marlyn Glen that the Government makes clear in our national outcomes the focus that we expect in national and local policy on tackling some of these questions. I refer her to one of those outcomes, which states:

"We have tackled the significant inequalities in Scottish society."

That outcome is to be part of the focus of policy making in Scotland, and our performance framework is designed to monitor progress towards achieving it.

Ted Brocklebank (Conservative, Mid Scotland and Fife)

To ask the Scottish Executive what powers it has to hold local authorities to account when a building has been placed on the buildings at risk register. (S3O-4754)

Linda Fabiani (Scottish National Party, Central Scotland)

The Scottish Government has no powers to hold local authorities to account when a building has been placed on the buildings at risk register. Placing a building on that non-statutory register creates no new legal powers or duties for either the Scottish Government or the local authority. Local authorities have a range of powers to choose from to prevent the deterioration of buildings, where they believe that it is appropriate for them to do that.

The Government is strongly committed to local decision making. It is properly for the local authority to decide whether to intervene in any particular case. Historic Scotland funds the Scottish Civic Trust to compile and administer the buildings at risk register. It prioritises grant aid towards buildings that are at risk and is always willing to discuss individual cases with local authorities when they wish to seek advice.

Ted Brocklebank (Conservative, Mid Scotland and Fife)

Is the minister aware that Hamilton hall, which is the historic B-listed former Grand hotel overlooking the Old course at St Andrews, has been placed on the register? Is she aware that development work on the building stopped a year ago, and that it is now open to the elements? Is she also aware that Fife Council has tried—so far without success—to contact the American owner of the building to ask him to effect urgent repairs? With the open championship returning to St Andrews in just 18 months' time, what can the Scottish Government do to save that iconic building?

Linda Fabiani (Scottish National Party, Central Scotland)

I understand Ted Brocklebank's concern—the building is certainly showing signs of neglect. Internal works took place, but they ceased more than a year ago. The building has broken windows and is an eyesore on the back of the golf course, which is one of Scotland's jewels. Our inspector is in touch with Fife Council; we understand that a solution is being sought and we will monitor the situation.

Alex Fergusson (None, Galloway and Upper Nithsdale)

Question 4 has not been lodged.

Claire Baker (Labour, Mid Scotland and Fife)

To ask the Scottish Executive whether it expects levels of student hardship to increase in this academic year. (S3O-4771)

Fiona Hyslop (Scottish National Party, Lothians)

Like everyone else, students will be affected by the current economic climate. We recognise that that may mean that more students are facing hardship, so we are working closely with colleges and universities to establish what demands are being made on the money that we provide to alleviate student hardship through the Student Awards Agency for Scotland and the Scottish Further and Higher Education Funding Council.

A total of £16 million—up from £14.7 million last year—has been allocated to the higher education discretionary funds in this academic year. That funding will enable students who are facing particular financial hardship to continue their course of higher education in college or university. For students studying in further education colleges, a total of £6 million, which will be administered by the Scottish funding council, is available.

In addition, the funding council has undertaken an early in-year redistribution exercise, and has been able to reallocate an additional £5.4 million. That reallocated money will be used to provide additional bursary support and meet requests for help with child care costs. We should not underestimate how quickly and effectively the funding council has responded to the pressures on college budgets. That has been recognised and supported by the college sector.

Claire Baker (Labour, Mid Scotland and Fife)

Can the cabinet secretary confirm that a student in England with a parental income of £50,000 receives more Government support than does the very poorest Scottish student? Does she agree that stripping over £12 million from funding for grants, bursaries and loans over the next three years, which is a result of the Scottish Government's decision to reduce the number of students who are eligible for Government support, risks increasing student hardship and drop-out rates, and threatens the widening of participation at Scottish universities?

Fiona Hyslop (Scottish National Party, Lothians)

I do not think that the member's second point is true, and I am happy to write to her on the matter. A recent announcement by the Westminster Government shows that it got its sums wrong and now has to cut £200 million from grant support for students in England.

The member's question might have slightly more credibility if she had supported the abolition of the graduate endowment fee. If it had been left to her and her colleagues, students in this country would have to pay an additional £2,300 in student fees. We are pleased to have abolished the graduate endowment fee and I am disappointed that the member was not able to support that.

Joe FitzPatrick (Scottish National Party, Dundee West)

In the light of the announcement by Labour's Secretary of State for Innovation, Universities and Skills, John Denham, that £200 million will be cut from student grants south of the border, can the cabinet secretary confirm that the Scottish Government will not follow suit and that we are still committed to increasing financial support for Scottish students?

Fiona Hyslop (Scottish National Party, Lothians)

We have introduced £38 million of additional support, which did not previously exist, for part-time students, to ensure that they no longer have to take out loans to study but can obtain grants to help them to further their studies. That is particularly important in the current economic climate, and it is only one element of the additional student support that the Government has already introduced. It will enable 20,000 students to take part in part-time study. That is very welcome in the current financial climate.

Jeremy Purvis (Liberal Democrat, Tweeddale, Ettrick and Lauderdale)

Does the cabinet secretary agree that, either through a minimum income guarantee or a full exemption, students should not pay local income tax?

Fiona Hyslop (Scottish National Party, Lothians)

The Cabinet Secretary for Finance and Sustainable Growth has indicated that he will examine that issue. We have some sympathy with the position of students in relation to exemption. We have indicated that we are sympathetic to the idea of consulting on a minimum income guarantee in relation to any developments with regard to student support in the future.

Christina McKelvie (Scottish National Party, Central Scotland)

To ask the Scottish Government what support it is giving to architecture and design services. (S3O-4828)

Linda Fabiani (Scottish National Party, Central Scotland)

We have increased funding for architecture to more than £1.8 million in this financial year. Within that sum, we increased our annual support for the Lighthouse from £350,000 to £450,000 and we increased our support for the Sust. programme on sustainability, which is based at the Lighthouse, from £200,000 to £450,000, which includes £150,000 to establish a Sust. resource centre.

This year, I have also committed £75,000 towards the Scottish presence at the Venice biennale on architecture; increased annual funding of the Royal Incorporation of Architects in Scotland Doolan award by £10,000 to £25,000 to enable the development of public touring exhibitions; and committed £35,000 over three years for a new civic trust award for place making in Scotland. That is a clear demonstration of the Government's commitment to architecture and design in Scotland.

Christina McKelvie (Scottish National Party, Central Scotland)

Will the minister expand on what she is doing to encourage education and outreach through the support that she is providing to architecture and design services?

Linda Fabiani (Scottish National Party, Central Scotland)

We have further developed the outreach programme that is managed by the Lighthouse to support organisations, communities and individuals in ways that best meet their ambitions to create a better built environment. That support is wide ranging and can take the form of residences, workshops, events or festivals.

Our proposals for the sustainable resource centre, as part of our enlarged Sust. initiative, will provide clients, design teams and users with opportunities to extend their understanding of sustainable materials and renewable energy sources.

We continue to support the SIX student awards for architecture in collaboration with the RIAS. The awards exhibition, which is managed by the Lighthouse, supports our emerging talent. Of course, I will continue to explore how funds can best be utilised to support young and emerging design talent in Scotland.

Cathie Craigie (Labour, Cumbernauld and Kilsyth)

That was indeed a long answer; I look forward to reading the Official Report to appreciate its content. What support might the minister offer the people of Cumbernauld and North Lanarkshire Council to retain and improve Adam house—known as Cumbernauld house—in my constituency?

Linda Fabiani (Scottish National Party, Central Scotland)

The issue that the member raises has been on-going for a long time and I have had representations from people who care very much about the building. Consideration of the situation will continue.

Jamie Hepburn (Scottish National Party, Central Scotland)

To ask the Scottish Executive how it supports the learning of Gaelic at pre-school level. (S3O-4823)

Adam Ingram (Scottish National Party, South of Scotland)

The Scottish Government is committed to supporting Gaelic and makes specific grant funding available to local authorities to support the development of Gaelic medium pre-school education in Scotland.

Jamie Hepburn (Scottish National Party, Central Scotland)

The minister might be aware of the Croileagan Bogha Frois organisation in Cumbernauld—I apologise to Dr Allan and John Farquhar Munro for my pronunciation. The organisation was set up by parents to help to teach their pre-school children Gaelic. I urge the minister to visit it, if he can. Does he agree that organisations that have been set up and run by communities have a big role to play in teaching Gaelic to young children?

Adam Ingram (Scottish National Party, South of Scotland)

Yes. I will not attempt to pronounce the playgroup's name, but it is a small, volunteer-led group that has recently had to move from Condorrat primary school because of space restrictions. The local authority supported the move by identifying premises for it and providing resources for the children's play and staff training. The move took place over the summer and the service was relaunched at the start of this academic year, generating a lot of local interest. That is a good example of the concordat in action.

Christine Grahame (Scottish National Party, South of Scotland)

The historic concordat!

Adam Ingram (Scottish National Party, South of Scotland)

The historic concordat, yes. It gives local authorities the freedom to allocate the resources based on local needs and priorities. [ Interruption. ]

Alex Fergusson (None, Galloway and Upper Nithsdale)

Order. There is too much noise in the chamber.

Ross Finnie (Liberal Democrat, West of Scotland)

To ask the Scottish Executive what action is being taken to ensure that home owners facing repossession orders receive protection under the Mortgage Rights (Scotland) Act 2001. (S3O-4839)

Stewart Maxwell (Scottish National Party, West of Scotland)

The Mortgage Rights (Scotland) Act 2001 provides significant protection for those at risk of repossession. Owners have the right to ask the sheriff to give them time to pay off arrears and lenders are obliged to comply fully with Financial Services Authority regulations.

In addition, Scottish Government officials met the Council of Mortgage Lenders on 23 October. The CML confirmed that its new guidance on repossession, which was issued that day, applies to all United Kingdom members and that it emphasises that lenders should consider all alternative options to repossession when dealing with home owners who are in mortgage difficulties.

We will continue to review whether the 2001 act requires any additional provisions to improve legal protection for home owners in Scotland.

Ross Finnie (Liberal Democrat, West of Scotland)

The minister will be aware that the Scottish Legal Aid Board has, since last year, routinely applied the preservation of property rule, which has the effect of depriving even those on low incomes of legal aid in house repossession cases. Although the Cabinet Secretary for Justice's announcement on increasing those thresholds is welcome, they do not affect the preservation of property rule. What steps will the minister take to ensure that mortgage holders who are threatened with repossession have access to free legal representation and thus access to the protections under the 2001 act?

Stewart Maxwell (Scottish National Party, West of Scotland)

I am glad that the member agrees that the announcement by the Cabinet Secretary for Justice was welcome. We provide protection and support for members of the public, but there are also a number of free advice services in relation to legal protection. There are also services and support through citizens advice bureaux and there are a number of other areas where people can access support and advice in taking cases. Of course, there is also the in-sheriff-court advice service. There are a number of protections and a number of support services are available. We will always keep these things under review and ensure that people in Scotland have the level of protection that they should. They have that level of protection at the moment, but we will always ensure that, if anything else is required, we take the necessary action.

First Minister's Question Time

Iain Gray (Labour, East Lothian)

To ask the First Minister what engagements he has planned for the rest of the day. (S3F-1165)

Alex Salmond (Scottish National Party, Gordon)

Later today I will have meetings to take forward the Government's programme for Scotland.

Iain Gray (Labour, East Lothian)

The First Minister's Cabinet Secretary for Education and Lifelong Learning was in my constituency yesterday to open a beautiful new primary school. I believe that she is opening four schools in a fortnight, and every single one of them—like Sanderson's Wynd primary school in Tranent—was commissioned, planned, funded and started by Labour—[ Interruption. ]

Alex Fergusson (None, Galloway and Upper Nithsdale)

Order.

Iain Gray (Labour, East Lothian)

What is Ms Hyslop going to do when she runs out of Labour schools to open? What are our construction workers going to do when they run out of Labour schools to build? We have yet to see a single school project initiated on this First Minister's watch. When will his education secretary be able to open a school that has been commissioned, planned and built by the Scottish National Party?

Alex Salmond (Scottish National Party, Gordon)

I do not know whether Iain Gray was conscious of the fact, but his claim about the achievements of the previous Administration—such as they were—caused some disconcertion in the Liberal ranks, who felt that they should share in the glory.

Of course, the truth is that the schools are not Labour schools or Labour-Liberal schools; they are the people's schools. [Interruption.]

Alex Fergusson (None, Galloway and Upper Nithsdale)

Order.

Alex Salmond (Scottish National Party, Gordon)

As are the 250 that will be built and refurbished in the term of this Administration. One thing was wrong with Iain Gray's suggestions: it is true that the schools that the cabinet secretary opened—one would have thought that Iain Gray would be grateful that she opened them—were planned under the previous Administration, but it is certainly not true that they were paid for under the previous Administration. They are public-private partnership and private finance initiative schools and the people will be paying for them for the next 20 or 30 years.

Iain Gray (Labour, East Lothian)

The First Minister should check his facts: the school that his education secretary opened yesterday—just like the other one in Tranent that he opened last year—was not a PPP or PFI school and it was certainly planned and built by Labour.

Last Thursday, the First Minister was in Glenrothes saying, "Yes we can," and the people of Glenrothes said to him, "Oh no you won't." When it comes to building schools, today he is trying to say, "Yes we are," but parents, teachers and councils are saying, "No you are not." The people know who has built their schools.

The problem now is this Government and its unworkable Scottish Futures Trust. The Government should listen to Glasgow City Council, which has said that, since last year's election, no new schools have been commissioned anywhere in Scotland. Glasgow had intended to consult on the next phase of its primary school investments using the SNP's preferred Scottish Futures Trust. Unfortunately, it says that the Scottish Futures Trust has proved to be "an embarrassing let-down". Will the First Minister admit again this week that he has got it wrong, ditch the Scottish Futures Trust and allow Scottish councils to start building schools?

Alex Salmond (Scottish National Party, Gordon)

I will give Iain Gray a few facts to interrupt his assertions. Since May 2007, when the Scottish people threw out the Labour—or Labour-Liberal—Administration, 11 projects have been signed off and about 55 schools have been planned, which involves 30,000 pupils and a combined capital value of £1 billion. Those schools are coming forward. Where will they be? In Falkirk, Perth and Kinross, West Dunbartonshire, East Dunbartonshire, West Lothian, Dumfries and Galloway, and of course—as of a few days ago—Inverclyde. Schools are in the pipeline in Moray, the Western Isles and Orkney.

I welcome Iain Gray's apparent conversion away from the PFI and PPP. The major difference with the schools that are being signed off and planned under this Administration is that a growing number of non-profit-distributing models are being used. That provides good value for the people and new buildings for pupils. The Government is prepared to face up to its financial responsibilities, instead of leaving them to future generations.

Iain Gray (Labour, East Lothian)

The trouble with the pipeline of schools that the First Minister describes is that it stretches back to before May 2007 to the previous Administration. The 30,000 pupils will have new classrooms in new schools that Labour set in motion.

Of those who are trying to build schools, let us consider North Lanarkshire Council. Previously, the council built 26 schools. It would like to build more. The plea of the council's education convener to the Government is:

"I would ask the Scottish Government to reconsider their plans for the Scottish Futures Trust. If they cannot find a way to make it work quickly, I would urge them to return to other funding mechanisms"—

yes—

"such as PPP. The alternative is that we continue to teach pupils in buildings which are no longer fit for purpose. I do not find this acceptable".

None of us finds that acceptable. I ask the First Minister again: in the interests of Scotland's schoolchildren, will he stop messing with his Futures Trust and start building schools?

Alex Salmond (Scottish National Party, Gordon)

It is clear that Councillor Jim Fletcher of East Renfrewshire Council does not share Iain Gray's views, as the councillor has accepted an appointment to the board of the Scottish Futures Trust. In case members were wondering, he is a Labour councillor. He has accepted that appointment because he realises—as do the vast majority of people in Scotland—that the PFI/PPP system of school building is redundant, because it has placed huge obligations on future generations and because the Treasury has decided that all such arrangements must be on the balance sheet as of next April. Perhaps Iain Gray's conversion away from PFI/PPP has less to do with his own analysis of the situation and much to do with further orders from London, where people seem to have changed their minds.

Iain Gray (Labour, East Lothian)

To tell the truth, I have little interest in the First Minister's putting one councillor on a board. I am interested in the First Minister's lack of ability to put our schoolchildren in new classrooms.

As for London, let us talk about it. The newest parliamentarian in Britain, Lindsay Roy, is here today. He has been the MP for Glenrothes for only one week, yet he has already seen—[Interruption.]

Ted Brocklebank (Conservative, Mid Scotland and Fife)

Has he lost his way?

Alex Fergusson (None, Galloway and Upper Nithsdale)

Order.

Iain Gray (Labour, East Lothian)

In one week, Lindsay Roy has already seen Labour in Westminster give the go-ahead for the rebuilding of 1,500 primary schools in England and he has seen councils in England being given £1.75 billion of additional support to make that happen. That is real money to build real schools, which will provide better conditions for hundreds of thousands of pupils and jobs for tens of thousands of construction workers when those jobs are needed most. Why cannot Scotland have some of that? The First Minister has had 18 months. He already has Scotland's share of that money. When do we get our schools and our jobs?

Alex Salmond (Scottish National Party, Gordon)

I note Iain Gray's conversion to telling the truth—that was a nice introduction to his question.

I welcome Lindsay Roy to the gallery. Perhaps we should swear him in to this Parliament—and, just for completeness, invite John Mason, the new MP for Glasgow East, to attend.

Iain Gray does not like Labour councillors who take a proper, practical and constructive view of the Scottish Futures Trust, and he does not want to talk about London, so I will try him with some statistics. He will find that the 250 new and refurbished schools that will be built within the term of this Administration is more than the figure that he cites for the United Kingdom school-building programme. Iain Gray's conversion to ploughing his own furrow is welcome, because he will not be overshadowed by the new Secretary of State for Scotland, Jim Murphy, who seems to be the new leader of the Labour Party in Scotland.

Annabel Goldie (Conservative, West of Scotland)

To ask the First Minister when he will next meet the Prime Minister. (S3F-1166)

Alex Salmond (Scottish National Party, Gordon)

I have no plans to meet the Prime Minister in the near future.

Annabel Goldie (Conservative, West of Scotland)

Yesterday, official figures revealed that 126,000 Scots are out of work. The much respected Fraser of Allander institute has predicted that, at worst, a further 117,000 jobs could be lost, and that there will be long-term negative effects on many of our businesses. Already, countless families in Scotland are feeling the pain of recession and fearing for their futures. Fewer people will be in work, more jobs will be lost and tax revenues will fall.

That harsh reality impacts on Scottish Government policy. Does the First Minister accept that his Government's cosy assumptions about a local income tax are now smashed to pieces? Is it not time to ditch that discredited, unmanageable and now economically flawed tax on work?

Alex Salmond (Scottish National Party, Gordon)

First, I acknowledge the severe problems with the economic downturn. We had a full debate on that yesterday, and I was pleased that the Parliament supported the constructive approach in the SNP Administration's 6-point plan, under which we are doing what is within our powers to combat the forces of the economic downturn.

Annabel Goldie is quite right that economic circumstances change forecasts. I point out to her as gently as I can that forecasts on house building and expected council tax revenue have also changed. However, underlying the question of taxation is a question about parity and fairness.

We all accept that no tax anywhere and at any time is popular, because people do not like to pay tax, but if we have to pay tax and fund services—as we all do—are we not better paying a fair tax that is based on the ability to pay as opposed to an iniquitous and hated tax, such as the council tax?

Annabel Goldie (Conservative, West of Scotland)

The First Minister revels in creating the illusion that he is an economics guru, or Scotland's very own financial prophet—the Brahan seer of Buchan. Earlier this year, he said:

"The Scottish banks are among the most stable financial institutions in the world."

If only.

What we need now is real help in tough times. The Scottish Conservatives have laid out how we can bring such help to every council tax payer in Scotland. In these unprecedented times, is the First Minister arguing that a council tax freeze is enough? Is he seriously ruling out any cut in council tax for the duration of this parliamentary session?

Alex Salmond (Scottish National Party, Gordon)

We should all accept that there are severe difficulties in the financial sector, and, incidentally, that some of its practices will have to change substantially in the new environment. However, I deprecate people who regard the problem as particularly affecting the Scottish financial sector, because that is simply untrue, for two reasons. First, Scotland has outstanding financial institutions that are pursuing their business through the economic downturn and the financial crisis, and they are doing so exceptionally well. Secondly, the difficulties that are affecting the clearing banks have affected banks throughout the world. The situation is not specific to any one bank, and it certainly is not specific to Scotland.

As to whether the council tax freeze is enough, no, it is probably not enough, but at least it is a good start for the people of Scotland. It is a good start because council tax increased by 40 per cent under the Conservative party from 1992 and increased by another 60 per cent under the Labour Party from 1997. One reason why the council tax is hated is that it is unfair; another reason is that, between the Labour and Conservative parties, it doubled in the space of very few years. Is the council tax freeze enough? No, but it is a lot better than the record of the Labour and Conservative parties.

Tavish Scott (Liberal Democrat, Shetland Islands)

To ask the First Minister what issues will be discussed at the next meeting of the Cabinet. (S3F-1167)

Alex Salmond (Scottish National Party, Gordon)

The next meeting of Cabinet will discuss issues of importance to the people of Scotland.

Tavish Scott (Liberal Democrat, Shetland Islands)

In response to the damning child protection inspection in Aberdeen, the Cabinet Secretary for Education and Lifelong Learning said this morning that she was

"reassured that considerable efforts are being made and things are moving in the right direction."

The recovery action plan that is being driven by the inspectors could take four months to produce, and the follow-up inspection will wait for a year. How can that possibly be urgent enough when children in Aberdeen face living in high-risk situations with drug-abusing parents and without adequate support or protection, and with services that do not intervene quickly enough in cases involving parental substance abuse and neglect? None of that is acceptable, is it?

Alex Salmond (Scottish National Party, Gordon)

No, it is not acceptable. Yesterday, I saw the exchanges in the House of Commons on the very distressing case in Haringey, but I did not think that they were particularly edifying, so let us try to consider such serious matters in the way in which they should be considered.

In Scotland, we benefit from having an extraordinarily rigorous system of inspection through Her Majesty's inspectors of child protection services. There have been 24 such inspections over the past two years. It should be said that some councils' performance has been exemplary. The performance of councils in West Lothian, Renfrewshire, East Renfrewshire, the Scottish Borders and North Lanarkshire has been extremely good. However, the performance of some councils—the latest example is Aberdeen City Council—has been totally and utterly unacceptable. In recent times, the only report that is comparable to the one that Aberdeen City Council has received is the one that Midlothian Council received towards the beginning of last year.

I make that point because, as a result of the inspection system and the identification of the problems, it has been possible to improve substantially the situation in Midlothian, and the same will happen in Aberdeen. It is not just that that will happen: because of our system, action has been taken since early indications of the report emerged in June. It has not been a case of waiting around for the report to be published; effective action has already been taken. I hope that, just as happened in Midlothian, there will be a substantial improvement in the ability of the social work department to fulfil its duties to the most vulnerable sections of the community—children who are at risk and people who need child protection.

Tavish Scott (Liberal Democrat, Shetland Islands)

I agree with the First Minister that the situation is totally unacceptable. Children in Aberdeen are at risk, so when he returns to the north-east, as I am sure he will this weekend, will he meet the political leaders of Aberdeen? Yesterday, in response to Aberdeen City Council's lack of Government funding, they published 317 pages of new council cuts, including more cuts to children's services. Will he tell them that they must deliver a first-class child protection service? This morning in Aberdeen, there is a child in a flat who has drug-abusing parents. The council needs to act and so does the First Minister's Government. Will he today promise more resources to help that child?

Alex Salmond (Scottish National Party, Gordon)

I do not know whether Tavish Scott is aware of this, but we have agreed in principle—exceptionally, because of the council's historical funding problems, which stretch back over many years—to allow the council to capitalise a significant element of its expected revenue costs, including those from equal pay compensation payments. That proposal is subject to the receipt of a detailed business case. We have been in touch with the council about the proposal over the past few weeks. Obviously, we have to get Treasury permission, but the indications are that, subject to a detailed business case being received, that can happen in time for the council to make its final decision on its revenue budget on 17 December.

Meetings have been taking place since June on the expected report, involving all of the authorities that are responsible for child protection. While no one could claim that the situation in the social work department as it affects child protection is perfect—we will wait for the re-assessment to see what improvement has been made—seven extra full-time social workers have been employed over the past few months, and initiatives have been taken to ensure that children are assessed by new staff in the maternity unit, to allow early intervention to take place. Significant staffing improvements have been made over the past few months. I stress once again that it was not a question of waiting for the report to be published. Luckily, because of our robust inspection system in Scotland, for which we should be grateful, we intervened early and took action to ensure that the situation improved now, as opposed to waiting until the report was published.

HBOS

Alex Neil (Scottish National Party, Central Scotland)

To ask the First Minister what further discussion the Scottish Government has had about the proposed merger of HBOS and Lloyds TSB and the impact that this will have on jobs. (S3F-1173)

Alex Salmond (Scottish National Party, Gordon)

I most recently met Lloyds TSB on Tuesday. I reaffirmed that the Scottish Government would continue to work closely with Lloyds TSB, and anyone else with alternative proposals, to ensure an outcome that minimises potential costs for Scottish workers, customers and the wider economy.

Alex Neil (Scottish National Party, Central Scotland)

Is the First Minister aware that within minutes of the United Kingdom Government being informed confidentially of the Bank of China's interest in bidding for HBOS, that information appeared in the blog of Robert Peston of the BBC? That is hardly the proper way to do business. Given the apparent attempts by the UK Government to sabotage any possible alternative to the Lloyds TSB bid for HBOS, will the First Minister remind the Prime Minister of his promise to treat any rival bid for HBOS on a level playing field with Lloyds TSB? Will he ask the Prime Minister to keep a promise for once?

Alex Salmond (Scottish National Party, Gordon)

First, I emphasise, as I have done before, that I make no criticism of Lloyds TSB, which is, quite properly, pursuing its commercial objectives. It also is a bank with a fine record in Scotland, both in banking and in insurance. I do not know the detail of the situation that Alex Neil described, but I find it difficult to reconcile what I interpret as clear political hostility to any alternative but the merger with the public pronouncements of a level playing field. The difficulty is this: with the best will in the world, a merger between two UK-based domestic clearing banks, involving synergies of £1.5 billion, will inevitably, even with the best of motives, result in substantial job losses and a diminution of competition.

While I support the means to stabilise the financial sector, many people will think it ironic, to say the least, that while substantial quantities of public money can be inputted to stabilise the financial sector, the outcome may well be a reduction in employment of the order of tens of thousands of jobs and a reduction in competition that will affect families and businesses throughout the country. Under those terms, I wish that the Prime Minister and the chancellor would live up to their public declarations of a level playing field for all options for the future of HBOS.

David Whitton (Labour, Strathkelvin and Bearsden)

Yet again we have heard more nonsense from Alex Neil, who seems to see a conspiracy around every corner.

In the First Minister's discussions with Lloyds TSB, did he ask it—as I have previously asked him to do—to ensure that there is no offshoring of Scottish jobs? He said that his first priority is to protect jobs in Scotland. One way to do that is to ensure that Lloyds TSB does not send those jobs to India. As the First Minister is well aware, Lloyds TSB's bid is the only bid on the table. I hope that he is putting his full effort behind ensuring that the merger goes ahead to protect the jobs that are so necessary here in Scotland.