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5.15 pm
Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale): It is a pleasure to follow the hon. Member for Glasgow, Shettleston (Mr. Marshall). As a member of the Select Committee on Scottish Affairs, I have enjoyed working with him and other colleagues, many of whom are present this afternoon. The hon. Gentleman was right to focus many of his comments about this Bill in the context of the Select Committee's visit to north America last week. We went to see, in practice, much of the work of Scottish Enterprise and its agencies, Locate in Scotland and Scottish Trade International. I concur with the hon. Gentleman's view that, as a group, we were very impressed by the work being done.
It is also a pleasure to follow the hon. Member for Shettleston because, in truth, he brought the debate back to the real issues that should be under discussion as we deal with the funding for Scottish Enterprise. I have, for my sins, over many years, pored over rather more sets of accounts than is probably safe for my sanity, but I have never inflicted an analytical review of a set of accounts on more than myself, and certainly not on a Chamber such as this. I was disappointed to hear that the main thrust of the speech from the Opposition spokesman was a comparison of balance sheets and expenditure over the past year. Although there is a legitimate scrutiny issue, time and again, the Conservatives have missed the point that, under the Scottish Parliament we will, for the first time, have an opportunity to have the accounts of enterprise agencies such as Scottish Enterprise and Highlands and Islands Enterprise, looked at thoroughly whereas perhaps, in the past, this House has not done that particularly well.
The timing of the debate is opportune. It comes at a time when Scottish Enterprise is announcing a new strategy which will take it forward into the millennium. It comes in a week when the noble Lord Macdonald of Tradeston made a statement to the Scottish Grand Committee in Edinburgh. Also, as I have said, it follows the Select Committee's visit to north America where we were looking closely at the work of many of Scottish Enterprise's agencies.
The hon. Member for Shettleston has graphically painted a picture of how much work remains to be done in different parts of Scotland if we are to ensure that enterprise and economic development are shared out
equally and benefit all areas of the country. Anybody who is in danger of being complacent has only to look at the list of recent job losses across the country. This week there have been job losses at Wrangler in Falkirk. There have been job losses on the ferries at Stranraer in Galloway. There has been a series of job losses in Dumfries and Prestwick and in the borders, my part of the country, we have seen unprecedented job losses. While the banana war continues in all its irrelevance between the United States and Europe, we suffer the consequence of hundreds of job losses in the cashmere sector.
It is important that we do not lose sight of any of those job losses when we are looking at the budget for Scottish Enterprise and how it may spend that money. When Lord Macdonald spoke to the Scottish Grand Committee he highlighted various weaknesses in the Scottish economy. He listed a poor level of business start-up, very low investment in research and development, low skills and zero population growth. He was eloquent in pointing out how we might address most of those issues, but, strangely, how to combat zero population growth was missing from the list of initiatives.
There can be no doubt that Scottish Trade International, which is a largely forgotten body in the economic development armoury of the Scottish Office, is an organisation that will have a greater role to play over the next 20 years. The themes of the Select Committee's visit to the United States were, time and again, the increasing need to take account of the knowledge-based economy and the fact that technology is changing very rapidly. Above all else, the Committee learnt that economies will have to adjust to mobile capital and the fact that businesses can very quickly move in and out of a country. Although Locate in Scotland has for years been very successful, we have to focus increasingly on outward investment, ensuring that Scottish companies receive as much assistance as possible in promoting their products and sales overseas.
Lord Macdonald also made much of the technology ventures initiative, which is examining ways in which Scottish Enterprise and other agencies may be able to help promote the growth of high-tech industries, which are critical to our future. The Scottish Office and Locate in Scotland have so far been successful in attracting Cadence to Scotland. Project Alba is examining ways of increasing our competence in chip technology systems and of expanding that knowledge base in Scotland. The project is very exciting but will require the support of a cluster of Scottish companies to make it successful.
I am concerned that, in Scotland, we are not yet sufficiently alert to the prospects of our financial sector or attuned to its needs. When the Committee was in the United States, we met a venture capitalist in Philadelphia who talked about establishing a European fund to provide capital to new, small high-tech companies. He plans to raise great sums to invest in Scotland, where he sees great potential. However, he does not foresee any great competition from Scottish venture capitalists. Perhaps Scottish Enterprise has more of a job on its hands than it has so far acknowledged.
This week, the Scottish Office made an announcement on establishing various business pathfinder groups to consider ways of promoting the Scottish Parliament to business and of ensuring that its Members and the Parliament's debates are attuned to business's needs and demands. That welcome initiative is directly relevant to
Scottish Enterprise. In the debate on devolution and on establishing the Parliament, the business community was initially atheistic about the Scottish Parliament. Business is now perhaps agnostic about the Parliament, but has not yet become evangelistic about it. Nevertheless, things are moving in the right direction, and anything that supports such movement is welcome.
I should be interested to hear the Minister address the issue of why, although Scottish Enterprise has identified oil, gas and electronics as key clusters in developing the Scottish economy, appropriate pathfinder groups are not being established. It is a strange omission.
There is much consensus on how the Scottish economy should be developed, although the issue will continue to be debated actively in the remaining few months until the elections in June and beyond. Nevertheless, when implementing its new strategy and using the new funds that we are considering today, Scottish Enterprise should consider the business culture in Scotland, especially the way in which we do or--more often--do not encourage entrepreneurship.
I am afraid that too many people become aware of the need for wealth creation and business creation, and of the fact that profit occasionally can be a good thing, long after they have left school and university. We cannot blame that situation on any one sector, but there is no doubt that teacher training and school and university curriculums do not address the issues of entrepreneurship and wealth creation, thereby creating a major gap in business education. We need look no further than that non-business culture to discover some of the reasons for our low start-up business rate. It is strange that successful business men and women are the exception rather than the rule when Scotland has produced so many over the generations. Over hundreds of years, Scots have proved their ability in international trade and business. We must not lose out because of a lack of far-sightedness from agencies such as Scottish Enterprise.
I agree with the hon. Member for Shettleston about the need to complete the M74 link from Tollcross to Kingston bridge. That highlights a wider issue for Scottish Enterprise and economic development throughout Scotland. It is incredible that Scottish Enterprise's remit does not include the need to establish or draw up a national infrastructure strategy. The Minister may say that different parts of the Scottish Office consider roads and rail. Some hon. Members are eagerly awaiting the announcement of those reviews in the next few weeks. From an economic development perspective, it is important in international competition for our major enterprise agencies to have a blueprint of the national infrastructure, covering rail, road, air and sea, that would best help to attract new businesses to Scotland and help indigenous companies to grow. IBM in Greenock is almost an indigenous company, but it is important when dealing with such global firms to keep Scotland competitive as a place to do business.
I referred earlier to the significant job losses that we have experienced in Scotland recently. I have argued for some time that there is a need to establish a rapid reaction unit in the Scottish Office to take account of problems as they strike a particular area. All hon. Members present today have their own experience of the Government's response to their local difficulties. I endorse and welcome all the efforts of the Borders working party. The direction
in which the interim report is going is encouraging, as long as the funding--of which there may be some available after this debate--comes along in due course.
Crises have hit Scotland time and again. They are unpredictable. Nobody could have expected Wrangler to announce the closure of its business this week and nobody foresaw the trouble at Viasystems in the borders. We need teams that can be assembled in the Scottish Office at short notice with the remit and responsibility to draw up local action plans, bringing together transport and education requirements and industrial and economic development issues. Sadly, the Scottish Office is getting a lot of practice at that at the moment. There is a good case for making it a standing part of Scottish Office machinery, particularly at Scottish Enterprise.
I should like to refer briefly to the situation in the borders. I have already talked about the need for the Government to keep a watchful eye on the trade dispute. I acknowledge that the Scottish Office cannot sort that out on its own. I want to put on record my gratitude to Scottish Trade International and other bodies in the Scottish Office that have worked closely with my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood) and me on that. I also had a helpful meeting with the Minister for Trade this week. The potential impact of the loss of jobs in cashmere would be devastating. We have had many job losses in the borders and people are bleary at the prospect of more. We saw the problems in textiles and agriculture coming, but we are now being confronted by an issue that has nothing to do with the borders. It started as a trade war over bananas between the United States of America and the European Commission and somehow came home to roost in the borders. That is bad luck. We must be confident that the Scottish Office and Scottish Enterprise will continue to be behind the borders and will face up to the threat.
I understand that local enterprise companies in Scotland will learn of their budgetary allocations in the next few days. Indeed, it may even be as soon as tomorrow. I hope that the House will be told pretty quickly and not via a press release issued late on Friday evening. Those allocations are an important part of the debate on the Bill.
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