Chamber
Meeting of the Parliament 07 December 2011
07 Dec 2011 · S4 · Meeting of the Parliament
Item of business
Autumn Budget Statement and the Scottish Economy
Mr Baker asks a fair question. I point him to the evidence that I shared with the Economy, Energy and Tourism Committee some weeks ago. In the year of greatest economic difficulty, 2008-09, there was still an increase in the overall take of business rates because of buoyancy within the business rates equation. As I have also said to the Parliament, I keep these factors under constant review. The commitment that we make in the spending review to the provision of non-domestic rates income will be part of the statement on local government in the Parliament tomorrow. When we offer that figure, the Government is guaranteeing that figure as part of the spending review settlement.
The Scottish Government will do all that it can, within the economic powers that we have, to support economic recovery, enhance economic security and create employment. As a result of our actions, Scotland’s recession was shorter and shallower than the recession in the rest of the UK, and we have a lower unemployment rate and a higher rate of employment than the rest of the UK.
Our enterprise agencies’ focused work is helping to attract new investment and major international companies to Scotland. Avaloq, Dell, Amazon, FMC Technologies and Doosan Power Systems are just a few of the companies that have announced new investments in Scotland.
We continue to embark on ambitious proposals to connect with major developing markets. China continues to be a driver of global growth and we are working hard to build on our links with it and create opportunities for Scottish companies. Last year, Scotch whisky was given legal protection with a geographical indication, which resulted in a 30 per cent rise in whisky exports to China in the first half of this year in comparison with 2010.
In January, we reached agreement with the Chinese Government to permit Scottish salmon exports into China for the first time. In the first half of this year, Scottish companies exported 2,300 tonnes of farmed salmon to China. We are working to ensure that more Scottish companies can take advantage of trade and investment opportunities in China and we are trying to attract more Chinese companies to base their European operations here.
This week, the First Minister has built on those achievements by signing a memorandum of understanding on culture, which commits the Scottish and Chinese Governments to supporting greater exchange and collaboration in the arts, creative industries, heritage and national collections, which will have a significant economic impact into the bargain.
In 2007, the Government chose to focus on key sectors in the Scottish economy. Many of those sectors have recovered and are growing strongly. In June, we announced a £1.1 million funding boost for Scotland’s food and drink industry. In September, manufacturing in our food and drink sector broke £9 billion in turnover for the first time. We are leading developments in renewable energy. More than £750 million of new renewable electricity projects have begun generating in Scotland, and the pipeline of projects will be worth £46 billion in the years that lie ahead.
At the heart of the Government’s growth strategy is infrastructure investment. In response to a cut of about a third in our capital budget in plans that the previous UK Government put in place, we propose to take forward a new £2.5 billion programme of non-profit-distributing investment and to switch significant sums from revenue to capital budgets and a range of innovative financial mechanisms to maximise investment. In addition to providing an immediate economic boost, that investment will deliver new schools, hospitals, houses and roads across Scotland.
The Scottish Government will do all that it can, within the economic powers that we have, to support economic recovery, enhance economic security and create employment. As a result of our actions, Scotland’s recession was shorter and shallower than the recession in the rest of the UK, and we have a lower unemployment rate and a higher rate of employment than the rest of the UK.
Our enterprise agencies’ focused work is helping to attract new investment and major international companies to Scotland. Avaloq, Dell, Amazon, FMC Technologies and Doosan Power Systems are just a few of the companies that have announced new investments in Scotland.
We continue to embark on ambitious proposals to connect with major developing markets. China continues to be a driver of global growth and we are working hard to build on our links with it and create opportunities for Scottish companies. Last year, Scotch whisky was given legal protection with a geographical indication, which resulted in a 30 per cent rise in whisky exports to China in the first half of this year in comparison with 2010.
In January, we reached agreement with the Chinese Government to permit Scottish salmon exports into China for the first time. In the first half of this year, Scottish companies exported 2,300 tonnes of farmed salmon to China. We are working to ensure that more Scottish companies can take advantage of trade and investment opportunities in China and we are trying to attract more Chinese companies to base their European operations here.
This week, the First Minister has built on those achievements by signing a memorandum of understanding on culture, which commits the Scottish and Chinese Governments to supporting greater exchange and collaboration in the arts, creative industries, heritage and national collections, which will have a significant economic impact into the bargain.
In 2007, the Government chose to focus on key sectors in the Scottish economy. Many of those sectors have recovered and are growing strongly. In June, we announced a £1.1 million funding boost for Scotland’s food and drink industry. In September, manufacturing in our food and drink sector broke £9 billion in turnover for the first time. We are leading developments in renewable energy. More than £750 million of new renewable electricity projects have begun generating in Scotland, and the pipeline of projects will be worth £46 billion in the years that lie ahead.
At the heart of the Government’s growth strategy is infrastructure investment. In response to a cut of about a third in our capital budget in plans that the previous UK Government put in place, we propose to take forward a new £2.5 billion programme of non-profit-distributing investment and to switch significant sums from revenue to capital budgets and a range of innovative financial mechanisms to maximise investment. In addition to providing an immediate economic boost, that investment will deliver new schools, hospitals, houses and roads across Scotland.
In the same item of business
The Deputy Presiding Officer (John Scott)
Con
The next item of business is a debate on motion S4M-01501, in the name of John Swinney, on the United Kingdom Government’s autumn budget statement and the Sc...
The Cabinet Secretary for Finance, Employment and Sustainable Growth (John Swinney)
SNP
I am grateful for the opportunity to open the debate on the autumn budget statement and the wider Scottish economy. It is now more than three years since the...
Mary Scanlon (Highlands and Islands) (Con)
Con
In comparing the United Kingdom with France and Germany, does the cabinet secretary accept that the coalition Government inherited the highest level of debt ...
John Swinney
SNP
I know that Mary Scanlon assiduously follows my speeches in the Parliament. She will not have noticed me in any way shirking from apportioning responsibility...
Richard Baker (North East Scotland) (Lab)
Lab
The cabinet secretary has rightly referred to the revision downwards of growth forecasts. What impact will that have on the Scottish Government’s spending re...
John Swinney
SNP
Mr Baker asks a fair question. I point him to the evidence that I shared with the Economy, Energy and Tourism Committee some weeks ago. In the year of greate...
Gavin Brown (Lothian) (Con)
Con
I apologise for missing the start of the cabinet secretary’s speech.In the switch from revenue to capital quite a large sum—about £150 million—will go into t...
John Swinney
SNP
No. The budget proposals rely on a shift from the revenue columns to the capital columns—that is a straightforward transaction in the budget document.
Gavin Brown
Con
The Forth crossing is not in the revenue budget.
John Swinney
SNP
I point out to Mr Brown that the UK Government has of course reduced our capital budget by 36 per cent, which has been moderated to 32 per cent. In the overa...
Willie Rennie (Mid Scotland and Fife) (LD)
LD
The infrastructure plan is a 20-year plan. The increased funding is provided within the first three years. What has been accelerated as a result of the incre...
John Swinney
SNP
Mr Rennie expects me to take a look at those questions, and we will come back to the Parliament, as we will on the other consequentials, to set out how our p...
Neil Findlay (Lothian) (Lab)
Lab
Will the minister give way?
John Swinney
SNP
I would give way to Mr Findlay if—
The Deputy Presiding Officer
Con
Cabinet secretary, you are in your last minute.
John Swinney
SNP
I apologise to Mr Findlay. I will happily deal with his points during the debate.The autumn statement provided some additional capital consequentials for the...
Richard Baker (North East Scotland) (Lab)
Lab
This is a welcome opportunity to debate the autumn statement and its implications for Scotland. It comes at a critical point for our economy and for the worl...
Jackson Carlaw (West Scotland) (Con)
Con
Is it not a consequence of the coalition Government’s strategy that we have the lowest interest rates in the world? Would not a consequence of the Labour Par...
Richard Baker
Lab
I presume that Mr Carlaw would not have acted to bail out the banks. The UK Government has left us the lowest rates of growth in the world, and it has choked...
Gavin Brown
Con
Will the member acknowledge what the Institute for Fiscal Studies has stated? It said that if Labour’s plans had been implemented, they would“now of course h...
Richard Baker
Lab
No, because the figures that I have show that the UK Government plans £37 billion more borrowing in future years than the amount in Labour’s plans that were ...
Gavin Brown
Con
Will the member give way?
Richard Baker
Lab
I have already given way to Mr Brown. I will try to take an intervention from him later.We understand that there will be limited consequentials in the new pl...
John Swinney
SNP
Will Mr Baker take this opportunity to confirm his understanding of the spending review, which involves a rising trend of capital expenditure in Scotland des...
Richard Baker
Lab
My understanding, from what the cabinet secretary said earlier, is that there will be consequentials later in the spending review cycle involving increased s...
Gavin Brown (Lothian) (Con)
Con
It is worth reflecting on some of the analysis and feedback from economists since last week’s autumn statement. The Economist put it simply, stating that“the...
Stuart McMillan (West Scotland) (SNP)
SNP
Does Gavin Brown agree that it is strange that it takes the OBR 18 months to realise that the strategic deficit is worse than planned? What has it been doing...
Gavin Brown
Con
I find it surprising that the member wishes to criticise the OBR, which has received praise for its work from across the political and economic spectrum and ...
Richard Baker
Lab
What is the cost to our economy from the fact that our growth rates are higher than only those of Greece and Portugal, out of the whole euro zone?
Gavin Brown
Con
The growth rates are very disappointing, but if one looks at the OBR report in full—not just the press release that accompanied it—one sees that, although th...