Scotland in the World: A NewPerspective

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Mr. Lazarowicz: The hon. Gentleman may have been too busy sneering to hear my clear statement that the views that I expressed were my own. I did not claim to speak on behalf of the financial sector as a whole or of individuals within it.

Pete Wishart (North Tayside): I wonder whether the hon. Gentleman has seen the recent opinion polls that showed that the vast majority of Scottish people wanted increased powers for the Scottish Parliament. How does that square with his view that the constitutional argument is dead?

Mr. Lazarowicz: Of course, the most recent polls showed a fall in support for the SNP and independence. I have no doubt that the prospects of the Scottish financial sector would be done the most damage possible if there was perceived to be a new risk of a period of uncertainty in the Scottish constitutional settlement and the relationship between Scotland and the UK. The biggest risk to thousands of jobs in my constituency, as in constituencies throughout Scotland, would be if the threat of separatism were to become real. It would mean more than just separation from the UK, as it would bring us a high-tax and high-regulation economy of the type that SNP Members want imposed on Scotland.

It is somewhat superfluous of me to ask the Secretary of State to oppose such policies. I am sure that she will do so, as she has always done in the past. However, it is important that we all reflect on the fact that it is incumbent on us to make devolution work and the constitutional settlement a success, and not to try to take the first opportunity to unravel and undermine it in the way that the members of the SNP seem determined to do at every opportunity.

12.42 pm

Sir Robert Smith (West Aberdeenshire and Kincardine): I should like to join those who have placed on the record how much they enjoyed the hospitality last night, the quality of the Scottish food on the menu and, in part, the message that was put before them of the need to promote Scotland, create the friends of Scotland and take that wider message throughout the world.

I hope that the Select Committee on Scottish Affairs will consider the workings of the friends of Scotland in more detail, as well as its efficiency and how it will evolve. I recognised names on the lists of advisory groups, and I recognise the quality that those people have to contribute. I welcome their commitment. In reply, the Minister might tell us how they were chosen, how they are accountable, and what their relationship is to him and the Government.

The video contained many strong messages. It is difficult for a Grand Committee to rewrite a script, but ``Scotland: The Script'' and the video might need to be tweaked. For instance, there were occasionally pictures of oil platforms somewhere out to sea, but oil platforms do not necessarily signify Scotland and a major Scottish industry, as they could be anywhere in the world. We should remind ourselves as well as the rest of the world of the importance of the oil and gas industry to the UK economy, especially the Scottish economy. It can still make a major contribution.

One of the frightening aspects of the current energy inquiry is the premature presumption that North sea oil is coming to an end, but we still have reserves that more than equal what has already been found. In promoting Scotland abroad, it is extremely important that we recognise the need to invest in Scotland. As one major source of inward investment, we need to attract the world's financial institutions to invest in North sea oil. We welcome the pilot initiatives and the taskforce. We also welcome the discussions that are taking place among those in the industry, between industry and the Government and between Government Departments. Much constructive work is being done but we must not lose sight of the fact that the industry has a long-term future.

There is a long-term future, too, for our export industry. The skills that have been developed in the North sea, as it becomes a mature province, will be of great value in other world markets. If we can keep North sea oil going, it will provide a major export base from which to develop the industry. I am worried by a frightening complacency among those working in economic development—this is often used against me by Labour Members on the Grand Committee. Constituencies such as those in Aberdeen and Banff and Buchan have been attacked for having low unemployment and it has been argued that we should not discuss the economy. There is a danger that those involved in economic activity see low unemployment in certain areas and think that there is no need to worry about them. Obviously, the infrastructure, support and challenges are different in those areas and, for those who live in such places, it is great to have that extra buoyancy in the economy. However, there are also challenges because skill shortages put a cap on attracting further investment, and infrastructure shortages and transport problems can constrain economic growth. I urge all those who are involved in examining the Scottish economy not to lose sight of the need to think ahead and work out how to keep what is good, learn lessons from it and build on it.

In the context of the skills shortage, we must maintain an open attitude to people from abroad who come to work in Scotland. People who have spent their entire life based in the north-east of Scotland, working in the North sea, have not needed a work permit to work offshore. Their whole lives are orientated towards Scotland but as soon as they stop working on that platform, they must leave the country because they have accrued no right of indefinite leave to remain. We need to reconsider how we treat people who have contributed so much to our economy.

I wish to discuss a few issues specifically relevant to the north-east of Scotland. The rail capital of Europe is linked by a railway line with single track on part of the line south. If we cannot join the north of Scotland to the rest of Europe through the channel tunnel with effective, high-quality, modern rail links, we are not exploiting effectively the fact that we are in Europe.

If we are to link up with the world, we must also recognise the need to extend our IT networks into the rural economy. One of my constituents is at the forefront of printing technology. His clients in Hawaii send him a CD-ROM by post, but imagine how much more competitive he could be if he had broadband access to the information.

Finally, I want to emphasise the point made by my hon. Friend the Member for Caithness, Sutherland and Easter Ross about agriculture. The Minister was right to say that food is an important form of recognition. If we can add value to our economy by promoting the export of our food abroad, that will be of great benefit. However, in rural communities, the worry is that Scotland's voice in Europe is blunted.

Before the election, we had a sense that the Government cared about agriculture. Collective Cabinet responsibility means that we cannot get into Ministers' personalities, but the last Minister of Agriculture, Fisheries and Food provided some reassurance that he knew what he was trying to do, even if he did not always deliver. Since June, the hatches have been battened down and the Government have turned their back on agriculture. The message is that they do not want to hear. At meetings of the Meat and Livestock Commission, those who work in the industry are given the message, ``We are not doing any more for you. You have had it.'' The reorganisation into a Department for Environment, Food and Rural Affairs—DEFRA—is rapidly being interpreted in many rural communities as DEATHRA. The real worry is that, at UK level, the Government are turning their back on agriculture.

I want to clarify matters in the European context. The previous Government allowed the rest of the European Union to set up the single currency. The agrimonetary compensation schemes are running out. There will be a lot of hard work to be done by anyone who is negotiating with our European colleagues about protecting our farmers from currency fluctuations affecting their support payments and their export market in Europe; when we are one of the few countries outside the eurozone it will be difficult to persuade our colleagues inside it that they need to come up with a successor scheme to agrimonetary compensation. We need to hear more from the Government about their willingness to deal with that and to battle hard for our hard-pressed agricultural economy.

The world is entering very uncertain waters. I share the concern of my hon. Friend the Member for Caithness, Sutherland and Easter Ross about the Chancellor's complacency. Certainly at this time Scotland needs to work with all the friends that it can get.

12.50 pm

The Minister of State, Scotland Office (Mr. George Foulkes): This has been an interesting if, at times, predictable debate. I shall devote the 10 minutes available to me to dealing with the points that have been raised.

I congratulate the hon. Member for Caithness, Sutherland and Easter Ross, who is named after part of his constituency—he probably owns part of his constituency—on a very balanced speech. I agree with him; the Scottish Parliament has driven life in Scotland forward and released new energy, not just in Edinburgh but throughout. As he said, two parties and the whole of civic Scotland contributed to setting up that Parliament, while two other parties sat skulking and sulking, whingeing on the sidelines. It is our parties that built the Scottish Parliament.

Several hon. Members have dealt with exports, including the hon. Member for Caithness, Sutherland and Easter Ross. He mentioned whisky, and its importance—I tread warily here. I am particularly concerned, as is the Secretary of State, about the current state of affairs, in which freight trains are not being allowed through the channel tunnel. That is threatening whisky exports at a crucial time—the run up to Christmas, which is celebrated throughout Europe. The Secretary of State, the Home Secretary and the Prime Minister are taking up the matter with the French authorities.

A number of hon. Members spoke about agriculture. Although I recognise, representing a rural constituency, that that is important, we need to put it in perspective. Of our total exports, the primary sector is only £5.5 billion out of £27.8 billion, and in the primary sector oil and gas are number one, as the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) said, followed by fisheries and then agriculture.

On oil and gas, I assure the hon. Member for West Aberdeenshire and Kincardine that we are not ignoring the great potential of the marginal fields and new exploration. Indeed, we set up pilots to study that. My right hon. Friend the Secretary of State, in her previous job, set up and chaired that project. The hon. Gentleman also mentioned IT. If he reads the report of my remarks in Westminster Hall earlier today—it seems like yesterday—he will discover many interesting facts about IT.

I want to mention to my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz), on the matter of exports, that the service sector is increasingly important—particularly, of course, the financial sector. Scotland is one of the leading financial sectors in Europe. It is in the top 10 for banking, life and pensions business and for investment management. That is something to be proud of. When my hon. Friend was talking about the financial sector and its importance, the SNP Members were sniggering and sneering. They sneer all the time, instead of trumpeting the great news about what Edinburgh and the financial sector represent.

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Prepared 28 November 2001