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20 Nov 2007 : Column 87WH—continued

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However, we must recognise the nature of the Scottish economy and its overwhelmingly dominant area, which is the central belt between Edinburgh and Glasgow and either side of it. Therefore, the development of decent homes is very important. It is a devolved issue, but I always reflect on the importance not just of local employment but of commuters and travelling.

However, throughout the area, Falkirk has more people employed in manufacturing than Scotland as a whole. Perhaps I could say a word or two about Alexander’s, which is unarguably one of the most important companies in the area. It is a manufacturing company that exports much of its product and employs about 900 people. About three years ago, it virtually went into receivership. All those jobs were saved by a new management team, some of whom had previously worked in the company, in conjunction with what was then a Labour Scottish Executive. They turned what could have been a disaster into an enormous success, and Alexander’s continues to employ people right across the skills spectrum. Of course there are some jobs that are towards the lower end of the spectrum, but many of them are highly skilled, which is reflected by the trade unions that represent the workers there. The future for Alexander’s is generally very bright indeed.

Borg Grech Photography, which is also based in Falkirk, is a small photographic company that has developed wireless technology to allow a camera and computer to talk to each other. The technology has proved valuable to visitors to the Falkirk wheel, and the company is currently building on its success to reach out across Scotland.

Another important economic issue in my area is the redevelopment of what was formerly the Alcan site. It was a large, world-sized aluminium company site and at one stage many thousands of people were employed there. The site is no longer in operation and it is being redeveloped by the local authority, Scottish Enterprise and other agencies as part of “My Future’s in Falkirk”. Companies are being encouraged to come in and invest. It is a legendary site because many retired people in my constituency worked there. There are large numbers of former artisans who worked in iron foundries and at Alcan, which was a related industry. They tend to be in their 70s and 80s now, but they talk a great deal about the site, so what happens there is important. I hope that there will be increasing economic activity there, albeit of a different kind.

The Helix development, of which my hon. Friend the Minister will be aware, is at the centre of local discussion, and the £25 million grant is crucial to it. The general principle is that by making the area attractive, we will flag up how Falkirk and the surrounding area is a good place for businesses to be based. That, in large part, will help us to move towards the target of £750 million, although I am always cautious when I refer to such figures as I like to see the colour of the money and know who the companies are and what they are going to do, rather than just see a projection. Although I absolutely welcome the principle of a potential £750 million investment, I am keen to know the detail. I appreciate that it will take time to unfold, but I shall keep my finger on the button.

Another company that I wish to mention is Malcolm Allan, a butcher’s. I went to visit it expecting something quite different from what I saw. The butchery trade has
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changed enormously in the past few years and, rather than being a few butcher’s shops, the company now supplies products to every town in Scotland—right across the board, even wee villages have a product from Malcolm Allan. It supplies high-quality, top end of the range pies, meat products and so forth and employs about 100 people. Such companies make all the difference to our local economy.

Lomond Plant is another great company. It has been started up by an entrepreneurial family and is doing incredibly well. The only constraint on its growth is the land around it; in one case, an owner is not keen to sell. That is a pity, as it could grow enormously. It employs several hundred people and hires out plant. People tend to work not on the site but with the plant all over Scotland. It is a great success story, constrained only by the unavailability of land in the area.

There is a Falkirk business panel, made up of local businesses, the local authority and Scottish Enterprise, which was recently joined by a group of entrepreneurs from the United States. I know from speaking to them that they were enormously impressed by the energy, drive and imagination of the business panel, which is making a great difference to our area. Environmentally, it is important to flag up the fact that 88 businesses in the Falkirk area are registered with the Scottish Environment Protection Agency for waste disposal and so forth, and more than 3,000 are registered with Falkirk council.

Having given details on some of the companies in the area, I wish to make the point that local businesses, like those across the United Kingdom, ultimately tie into a much larger economy. Their success and failure will depend on not just their ability to recruit and train locally but much larger factors—the cost of money, the fiscal regime, globalisation across the board and competition from the enormous investments that India and China are making in training, science and technology and the threat or potential benefit of that to our economy.

It is essential that my constituents and businesses in my constituency get a chance to feed into the Government’s enterprise strategy. My understanding is that, due to the nature of the Administration in Scotland and devolution, there is a little confusion about what the whole thing means. The temptation for people in Scotland is to think that enterprise is a devolved issue and that anything to do with enterprise strategy is therefore devolved. In this case, many of the issues involved are manifestly reserved, and it is important for the consultation that will lead to the White Paper to be extended to my constituency and right across Scotland. Will the Minister assure me that he will examine the possibility of that happening?

Scottish Enterprise is a devolved body, and I do not intend to comment on its operation, but it acts extremely well in conjunction with many employers in my area, my local authority and other agencies. One can discuss until the cows come home how those organisations are best structured—I do not really have an ultimate view on that—but I understand that they may be restructured, in effect passing certain powers up to the Scottish Executive and certain other powers down to local authorities. In the case of a large local authority such as Glasgow or Edinburgh, I can see how that might make
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sense, as there are economies of scale and expertise to be made at local authority level. I am lucky enough to have excellent officers and good councillors in my local authority, but there is a danger—I shall put it no stronger—that if certain powers currently held by Scottish Enterprise are devolved to local authority level, local economic decisions may be over-politicised. They really ought to be made for economic reasons, not short-term political reasons.

Within the constraints of devolution, reserved powers and so on, will the Minister say whether he has a view on the reorganisation of Scottish Enterprise and whether he is watching its progress? I am especially impressed by the acting chief executive, Stuart Ogg, and his colleagues in my area, and I know that my colleagues who share the Forth Valley Enterprise area feel the same way. I would be concerned with developments if it looked as though we might overly politicise some local economic decisions that would be best kept at a business and economic level.

12.48 pm

The Minister of State, Scotland Office (David Cairns): It is a pleasure to serve under your chairmanship this afternoon, Mr. Chope. I am sure that you have an extensive knowledge of the economic situation in Falkirk, and that it has been added to by the contribution of my hon. Friend the Member for Falkirk (Mr. Joyce). It is of course an entirely legitimate and expected role of Members of Parliament to act as advocates and ambassadors for their constituencies in Westminster and Whitehall, but there are few more active advocates for their constituencies than my hon. Friend. He never misses an opportunity to promote his constituency as a good place to live, work and do business. It is to his credit that this is the second debate that he has managed to secure in a few months on economic development in the town of Falkirk and the wider region of central Scotland, and that he has been tireless in advocating the needs of his constituency in that regard.

My hon. Friend asked specifically about how the UK Government’s enterprise strategy will be taken forward in Scotland, about the effect of the changes that the Scottish Executive might make to the enterprise network, and about how those factors interact. He was right to say that it is impossible, in the 21st century, to isolate a nation, let alone a region or town, in terms of economic strategy. These matters are interconnected and that is evidenced by the fact that there are Government Departments in both Westminster and Edinburgh with the word “enterprise” in their titles.

It is not possible to say that enterprise is either reserved or devolved; it is closely interdependent with other factors. Decisions that we take here, as a Government, on the macro-economic framework and the taxation regime, and in relation to European regulations and the wider fiscal framework within which business operates, must have an impact on local economic development in Scotland. It is false and simplistic to say that matters relating to enterprise and economic development in Scotland are devolved. That is not the case and my hon. Friend is right to highlight those factors today. I shall address the two issues that he discussed in a moment.

My hon. Friend was right to locate his comments about how the economy in Falkirk is doing within the wider picture of how the Scottish economy is doing.
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Recent Scottish gross domestic product figures confirm that the Scottish economy continues to grow at above-trend rates. Since the beginning of 1999, there have been 20 quarters of greater-than-trend growth, which shows that Scotland, like the UK as a whole, is performing consistently well. In contrast, over the same period, progress in some of the major eurozone countries has been constrained by sluggish growth and high unemployment, the American economy has experienced well-documented difficulties and many economies in south-east Asia have been in crisis. So, at a time of international economic uncertainty and rapidly fluctuating commodity prices, Scotland continues to perform well, and more and more people are finding work in a growing economy. This year, there have been record levels of engagement with the labour market and historically low unemployment. Moreover, there have been record highs in the number of people available to take up employment.

Those things have not happened by accident. The Government have pursued policies that combine active labour market stimulation with flexible labour market policies, which allow employers to create jobs and people to take those jobs, and which make that choice pay by ensuring that people are better off in work than they would be on benefits. Programmes such as the new deal have helped to provide more than 280,000 additional jobs in Scotland compared with 1997. The new jobs being created in Scotland since 1997 are overwhelmingly in the private sector. We do not apologise for creating more nurses, doctors, police and community support officers, but it is a myth about the Scottish economy that the growth and employment is located entirely in the public sector. That is not the case. As my hon. Friend discussed, the companies that are expanding and doing well in his constituency are typical of private sector companies throughout Scotland that have been expanding and taking on more workers. As he pointed out in his opening remarks, the Scottish employment rate is 76.5 per cent.—that is higher than the UK equivalent and has been for the past three years. The proportion of those who are economically active, meanwhile, outperforms the UK figure, and the Scottish unemployment figure is lower.

Those figures would have been inconceivable 10 or 15 years ago, when my hon. Friend and I were growing up in politics and became used to Scotland lagging behind the UK even in a time of high unemployment. Constituencies such as Falkirk and Inverclyde used to be at the back of a long tail of constituencies with dreadful unemployment figures. Unemployment now stands at 5.4 per cent., whereas the figure across the EU is 7.1 per cent. Behind those figures are people and families who can now aspire to better things for their children, enjoy more holidays and look forward to Christmas in a way that simply would not be possible were we still in the high-unemployment economy that existed when unemployment was regarded as a price worth paying.

My hon. Friend mentioned many companies in his constituency and the people who are creating jobs and driving economic growth. He mentioned in particular Malcolm Allan the butchers, which is a great example of a small, local company with an entrepreneurial spirit seeing an opening in the market and moving it forward. I would like to share with him an example from my constituency that highlights what is going on in Scotland
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beyond Falkirk. Port Glasgow, in my constituency, has a huge new Tesco store, which is very welcome and has created many new jobs but has put pressure on the traditional town centre. What is going to happen to the traditional small shops and businesses that employ small numbers of people and have been the backbone of the local economy for many years? My hon. Friend talked about the local butcher in his constituency making a difference; our active Port Glasgow town centre traders association is headed by the local butcher, Drew Mackenzie, who is an excellent businessman and has real entrepreneurial spirit and a passion for Port Glasgow. He is helping to drive forward an agenda that will see the town centre flourish alongside Tesco; it does not have to wither and die.

Mr. Joyce: The Minister and I clearly have something in common—entrepreneurial and excellent local butchers—and it is good to hear about Drew and Malcolm. I also have a company called Composite Energy, which is looking to extract methane from under the ground. It tells me that there was considerable risk in setting up the venture, which involved people reducing their incomes and making substantial investments, and that it will not pay off for some time. Does the Minister agree that the way in which we tax such businesses is absolutely fundamental to whether they can make a fist of things in the early years?

David Cairns: I agree entirely. We must have taxation and broader fiscal strategies that encourage entrepreneurialism and encourage people to create jobs. Those jobs might not be created in the same volume as those created by massive employers in our constituencies in years gone by, but we are tired of putting all our eggs in too few baskets. We need a diversified employment base in those areas, and given a choice between having one factory employing 1,000 people and 10 factories employing 100, I know which I would choose. We have to ensure that we encourage those small businesses.

In the few minutes remaining, I shall address the two specific points that my hon. Friend raised. He rightly said that the Government are engaged in consultation with business in preparation for a new enterprise strategy paper next year and that much consultation has been taking place throughout the UK. He is also right to call on the Government to ensure that Scottish businesses are consulted, especially in areas that are not devolved, because we cannot simply isolate the conditions for the economic growth of small and medium-sized businesses and say that that area is devolved; it is not. I assure him that the Government will work closely with businesses in Scotland to make sure that they have an input into our enterprise strategy for the years ahead. As the UK develops its policy, it is vital that the voices of Scottish businesses are heard on many of the broader issues of taxation and European regulation that have been mentioned, and on the question of how we rise to the challenges of globalisation.

My hon. Friend mentioned the reform of the enterprise network. I shall not stray too far on to that because it is devolved, but we are all watching it with interest. We know that it is important to get this right. It is important to have a higher-level strategic view across regions—those of us who have been local councillors know about the demands on local council finances—so that we do not lose vital economic stimulation.

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I congratulate my hon. Friend on bringing these issues to the House’s attention. He is an excellent advocate for his constituency and as long as he is a voice representing Falkirk in the House, the needs of business, enterprise and employers in that area will never be short of a close and articulate friend.

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Digital Broadcasting (Forest of Dean)

1 pm

Mr. Mark Harper (Forest of Dean) (Con): It is a great pleasure to serve under your chairmanship once again, Mr. Chope. Just to be clear about the scope of this debate, it is primarily focused on digital radio broadcasting services, although I shall touch at the end on digital television and ask the Minister one or two questions about it.

On 19 July, Ofcom announced a licence to provide a multiplex digital local radio broadcasting service in Gloucestershire. Having studied the advertisement and discussed it with colleagues who are more technically knowledgeable than me about such matters, I had several concerns about how well the digital multiplex would serve my constituents.

I wrote to Ofcom’s chief executive on 13 September to express my concerns about the tender advertisement. The advertisement implied that there would be a big focus on a transmitter at Churchdown, which would leave my constituents disadvantaged, due to the geography of our county. I also expressed concern that the tenders would inevitably focus on the urban and more densely populated parts of the county, which has Cheltenham and Gloucester at the centre geographically, and that they would tend to leave the more outlying rural areas, including my constituency in the Forest of Dean, somewhat at a disadvantage. I had a response from Ofcom on 5 October which I thought was rather dismissive of the concerns that I had raised on behalf of my constituents. I did not think that it dealt adequately with my concerns.

On 24 October, applications closed for the licence for Gloucestershire. There were two applicants: MuxCo Gloucestershire Ltd and Now Digital. Having taken some time to study their bids, I believe that neither would provide decent or acceptable coverage for my constituents in the Forest of Dean. The bid from MuxCo is much the worse of the two, from my constituents’ point of view. Looking at the mapping that has been provided, it seems that the whole western part of my constituency and three of the four towns—Cinderford, Coleford and Lydney—would be almost completely excluded from being able to receive the digital radio signal. My rough estimate is that well over half of my constituents would be excluded from the company’s broadcasts.

Mr. Geoffrey Clifton-Brown (Cotswold) (Con): Is my hon. Friend and constituency neighbour aware that whereas the MuxCo proposal is disadvantageous to his constituency, it does include most of the Cotswolds, but the proposal from Now Digital, which gives his constituency a little bit of coverage, gives the Cotswolds virtually none? Does he agree that it is unacceptable for Ofcom to put out a tender that does not include the maximum number of people in both our constituencies?

Mr. Harper: I thank my hon. Friend for his intervention. Indeed, I was about to discuss the Now Digital proposal. As he may have guessed from my comments on the MuxCo proposal, the Now Digital one is marginally better for my constituents, but, as far as one is able to tell, it still excludes Cinderford and Coleford and a large
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chunk of the population in the west of my constituency, and, as he said, it almost completely excludes his constituency.

The extraordinary thing about both bids is that they exclude large chunks of Gloucestershire, which is actually the area covered by the broadcasting licence, but they broadcast to significant parts of Wiltshire, south Gloucestershire and Worcestershire. Many people who are not covered by the local radio stations will be able to get the signal, but many of the people who ought to be able to get it will not.

I have written to both companies, first, to try to get more accurate information. The number of people who will or will not be covered under their bids cannot be ascertained from the map—it is not very clear. I am realistic and could understand, given the geography of my constituency, if less than 100 or even 99 per cent. of my constituents were covered. Indeed, under the current analogue broadcasting arrangements, some parts of the constituency that are large geographically but relatively small in population numbers do not get very good coverage. However, a bid that excludes significant parts—three of the four major towns, and approaching more than half of my constituents—is simply not acceptable and cannot really be considered a bid for a Gloucestershire local broadcasting system.

Therefore, I wrote to both organisations and to Ofcom to ask for more information but also to ask them, particularly Ofcom, to take into account my concerns after seeing the bids and to consider whether the situation could be improved. My constituents are very concerned about it. I have had people write to me in the past about digital television broadcasting and the problems that they experience with it, and I know that many of them are concerned about problems with radio broadcasting.

The Government very much promote the move to digital broadcasting across platforms, as do I in general—it has several advantages—but it is important that as many constituents as possible are included in the digital world and that we do not set up a digital divide, with my constituents being on the wrong side of it. I would be very pleased if the Minister would address that concern.

As a result of my securing this debate, Ofcom has been in touch with my office and provided me with a helpful briefing note—at least, it is helpful in respect of the facts; it is not particularly helpful in respect of the process that it will follow. It states that it does not require that any specific areas within the outline boundary—in this case, Gloucestershire—be served, and that it does not have a preference about the transmitters that the companies use, which, of course, does not cheer me at all.

Ofcom also stated that its assessment will consider the population coverage achieved within the county as a whole, but that it is prevented from requiring that all or any part of the area be served. Clearly, that has left me with a great concern that one or either of the bids will be approved unchanged, and that my constituents will be locked out of being able to enjoy local digital broadcasting in the future. That is not acceptable.

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