Chamber
Plenary, 07 Mar 2007
07 Mar 2007 · S2 · Plenary
Item of business
Small Business
Unlike Mr Morgan, I am not a nationalist who thinks that the gap necessarily requires to be closed—[Interruption.] Members of the Scottish National Party are laughing, but Scotland benefits from the devolution dividend that the £11 billion expenditure represents. SNP members are fond of promoting the idea that taxes are too high and should be cut so that we can match Irish levels of social services spend, but do the Scottish people want the levels of spend that exist in Ireland, where people have to pay to see their doctor? Do they want to follow the Norwegian example, in which the basic rate of income tax is well beyond the rate in Scotland? SNP members cannot have it both ways: they cannot promote a low-tax economy and high social services spend. The £11 billion that they regard as a drag on economic growth benefits this country, because it helps to fund the levels of social services that we require. We are able to provide a free health service out of the UK Exchequer as a whole. That is the devolution dividend.
We want to—and we can—do more. We want to help Scottish business achieve the competitive edge that is necessary to succeed in an increasingly dynamic global economy. That is why we took the decision to halve the rate poundage gap with England this year, which benefits not only small businesses, but all businesses, in Scotland. We are determined to build on that, which is why we announced our intention to go further and cut the poundage to the level in England on 1 April 2007. The new rate for Scotland represents a full 2p cut in rate poundage since 2005-06. The average non-domestic ratepayer in Scotland will pay around £800 less in 2007-08—a reduction of around 9 per cent—as a result of our policy of equalisation with England. That will give Scottish businesses a competitive edge.
I noticed recently that the SNP proposes to shelter small and medium-sized enterprises from open and genuine competition for public procurement contracts. The SNP set a target of 20 per cent. That would represent a cut in the current level of participation by Scottish SMEs in public procurement. It demonstrates the level of the SNP's ambition in relation to public procurement contracts for small and medium-sized enterprises—the SNP actually wants to cut their rate of participation in public procurement.
As part of our on-going work, the Executive is gathering data on procurement spend on goods and services across the public sector. That data-gathering exercise is far from complete, but preliminary analysis indicates that spending with SMEs in Scotland is well in excess of the SNP's proposed target. I suggest that SNP members send their researchers back to think again.
Far from being complacent, we believe that the decisions that we have taken are vital to growing a successful, dynamic and stimulated economy. When we are returned after the election, as we undoubtedly will be, we will make further proposals for growth in the SME sector, to build on the economic growth and the success that has already been achieved here in Scotland.
I move amendment S2M-5690.3, to leave out from "to make" to end and insert:
"to continue to grow the Scottish economy and to support the competitiveness of Scottish businesses; welcomes the steps that the Scottish Executive has taken to achieve that by listening to business and reducing the level of business rates; supports measures to encourage innovation, including supporting links to Scotland's science and research base and easing access by business to public sector contracts; welcomes support from Scottish Enterprise and the Business Gateway through investing in a highly skilled workforce in Scotland, such as through the modern apprenticeships scheme, and increasing investment in the infrastructure necessary to build a modern competitive economy."
We want to—and we can—do more. We want to help Scottish business achieve the competitive edge that is necessary to succeed in an increasingly dynamic global economy. That is why we took the decision to halve the rate poundage gap with England this year, which benefits not only small businesses, but all businesses, in Scotland. We are determined to build on that, which is why we announced our intention to go further and cut the poundage to the level in England on 1 April 2007. The new rate for Scotland represents a full 2p cut in rate poundage since 2005-06. The average non-domestic ratepayer in Scotland will pay around £800 less in 2007-08—a reduction of around 9 per cent—as a result of our policy of equalisation with England. That will give Scottish businesses a competitive edge.
I noticed recently that the SNP proposes to shelter small and medium-sized enterprises from open and genuine competition for public procurement contracts. The SNP set a target of 20 per cent. That would represent a cut in the current level of participation by Scottish SMEs in public procurement. It demonstrates the level of the SNP's ambition in relation to public procurement contracts for small and medium-sized enterprises—the SNP actually wants to cut their rate of participation in public procurement.
As part of our on-going work, the Executive is gathering data on procurement spend on goods and services across the public sector. That data-gathering exercise is far from complete, but preliminary analysis indicates that spending with SMEs in Scotland is well in excess of the SNP's proposed target. I suggest that SNP members send their researchers back to think again.
Far from being complacent, we believe that the decisions that we have taken are vital to growing a successful, dynamic and stimulated economy. When we are returned after the election, as we undoubtedly will be, we will make further proposals for growth in the SME sector, to build on the economic growth and the success that has already been achieved here in Scotland.
I move amendment S2M-5690.3, to leave out from "to make" to end and insert:
"to continue to grow the Scottish economy and to support the competitiveness of Scottish businesses; welcomes the steps that the Scottish Executive has taken to achieve that by listening to business and reducing the level of business rates; supports measures to encourage innovation, including supporting links to Scotland's science and research base and easing access by business to public sector contracts; welcomes support from Scottish Enterprise and the Business Gateway through investing in a highly skilled workforce in Scotland, such as through the modern apprenticeships scheme, and increasing investment in the infrastructure necessary to build a modern competitive economy."
In the same item of business
The Presiding Officer (Mr George Reid):
NPA
The next item of business is a debate on motion S2M-5690, in the name of Jim Mather, on the economy and small business.
Jim Mather (Highlands and Islands) (SNP):
SNP
Members will know that we in the Scottish National Party want to create the conditions that will make Scotland more populous and more prosperous. Members of ...
Mike Rumbles (West Aberdeenshire and Kincardine) (LD):
LD
The problem is that people do not know which SNP to put into power. Is it the SNP of Jim Mather, who wants to cut taxes, or the socialist republic SNP of Chr...
Jim Mather:
SNP
We will raise taxes by growing the economy. The member should read his newspapers. If he had read The Scotsman five months ago, he would have seen the editor...
The Deputy Minister for Enterprise and Lifelong Learning (Allan Wilson):
Lab
Jim Mather talks about raising taxes by growing the economy. By how much will he grow the economy to fill the £11 billion gap that is the differential betwee...
Jim Mather:
SNP
The minister wears his fantasy like a badge of pride, which it is not. If the calculations included our oil, a proper allocation of civil service jobs and de...
Murdo Fraser (Mid Scotland and Fife) (Con):
Con
Will the member tell us how the SNP's plans for a local income tax of 6.5 per cent, which would be paid on the profits of every unincorporated small business...
Jim Mather:
SNP
If the member listened to the Institute for Fiscal Studies, which tells us that the rate will be about 3 per cent, he would perhaps copy our policy on that, ...
The Presiding Officer:
NPA
I call Allan Wilson, to speak to and move amendment S2M-5690.3. Interruption.
The Deputy Minister for Enterprise and Lifelong Learning (Allan Wilson):
Lab
The fact that I am being attacked before I have said anything is a badge of pride that I wear in the chamber.In the five minutes that are available to me, it...
Jim Mather:
SNP
We are in a global boom at the moment, but all Scotland can muster is 2.3 per cent, so yet again we are working on low growth. Does the minister equate low g...
Allan Wilson:
Lab
What I equate with stability are the fundamentals of economic growth. That view is held not simply by the Labour and Liberal Democrat Scottish Executive but,...
Alex Neil (Central Scotland) (SNP):
SNP
Will the minister give way?
Allan Wilson:
Lab
No. I will carry on, if the member does not mind.We have almost the lowest unemployment since quarterly records began—the rate is below the UK rate for the f...
Alasdair Morgan (South of Scotland) (SNP):
SNP
The minister is fond of saying that Scotland is being subsidised by the rest of the UK to the tune of £11 billion. I do not accept that figure, but the minis...
Allan Wilson:
Lab
Unlike Mr Morgan, I am not a nationalist who thinks that the gap necessarily requires to be closed—Interruption. Members of the Scottish National Party are l...
Murdo Fraser (Mid Scotland and Fife) (Con):
Con
I welcome this afternoon's opportunity to debate the future of the Scottish economy and, in particular, support for small businesses. The debate is timely as...
Fergus Ewing (Inverness East, Nairn and Lochaber) (SNP):
SNP
If the Conservatives are so against quangos, why does Murdo Fraser's amendment propose a new quango—a dedicated skills agency? How much would it cost? How ma...
Murdo Fraser:
Con
It will have a budget of £170 million. We are proposing to transfer away from Scottish Enterprise—which is a largely discredited organisation that deals with...
Alex Neil rose—
SNP
Murdo Fraser:
Con
Mr Neil is now going to justify that outrageous tax grab against small businesses.
Alex Neil:
SNP
Not at all—Mr Neil is simply going to ask two straightforward questions. First, how are the Conservatives going to fund the council tax rebate to pensioners ...
Murdo Fraser:
Con
We have made it perfectly clear where the money to fund our pensioner council tax discount will come from. When we move Scottish Water out of the public sect...
Jeremy Purvis (Tweeddale, Ettrick and Lauderdale) (LD):
LD
Will the member give way?
Murdo Fraser:
Con
Do I have time, Presiding Officer?
The Presiding Officer:
NPA
You have a maximum of about two minutes.
Murdo Fraser:
Con
I will happily give way.
Jeremy Purvis:
LD
Have the policies that Mr Fraser is outlining been met by an explosion of indifference across the country because the Tories have said that they have no desi...
Murdo Fraser:
Con
Nobody can prejudge the outcome of the election. Who knows where we will be after it? The Conservatives may be sitting here with a much expanded group and—as...
Mr Andrew Arbuckle (Mid Scotland and Fife) (LD):
LD
I find it interesting that the SNP motion is on small businesses rather than the large business sector and that Jim Mather provided a pretty rosy-eyed romp t...