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House of Commons

Wednesday 9 July 2008

The House met at half-past Eleven o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions


The Secretary of State was asked—

Commonwealth Games

1. John Robertson (Glasgow, North-West) (Lab): What discussions he has had with the First Minister on the employment opportunities in Scotland provided by the Glasgow Commonwealth games 2014. [216424]

The Minister of State, Scotland Office (David Cairns): My right hon. Friend the Secretary of State has regular discussions with the First Minister.

John Robertson (Glasgow, North-West) (Lab): I thank my hon. Friend for that extensive answer. I know he realises that the Commonwealth games are very important to Glasgow and, for that matter, to the UK. However, the people I have been speaking to have some concerns about job opportunities and investment in the city that might have a knock-on effect on the games. They cite the 40 per cent. cut in funding for Glasgow’s science centre, with a loss of 28 jobs, as an example of what could happen if the Edinburgh Executive have a go at it. Will he assure me that he and his Department will ensure that the Glasgow Commonwealth games are properly funded and go ahead as planned?

David Cairns: I am glad that my hon. Friend liked my original answer, when I said that the Secretary of State has regular discussions with the First Minister. That is more than I do, as the First Minister refuses to discuss these issues with me. He is far too grand to discuss them with an oik from a council estate in Greenock.

My hon. Friend is right on two counts. The Glasgow science centre—which I believe has been described in some quarters as a complete waste of money—is a magnificent addition to the city of Glasgow. It is an investment in science at exactly the time when that is what we need. I absolutely deplore the cut that he has mentioned, but I am convinced that the Commonwealth games will go ahead and that they will be a magnificent success.

Mr. Michael Moore (Berwickshire, Roxburgh and Selkirk) (LD): May I through you, Mr. Speaker, take this opportunity to pay tribute to David Marshall? He was a stalwart of Scottish questions and will be sorely missed in the Chamber. He had many friends across the House and we on these Benches wish to express all our best wishes to him and his family. If he were here, I am sure that he would also be pressing the Minister on this issue. We are all ambitious for the opportunities that the Commonwealth games will give Glasgow and the rest of Scotland. More immediately, however, is the Minister
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not alarmed by the fact that so far only 2 per cent. of the contracts awarded to businesses for the 2012 Olympic games have come to Scottish businesses? Is that not symptomatic of how Labour has taken its eye off the ball and become out of touch with Scotland’s needs?

David Cairns: No, the hon. Gentleman is not right about that, but he is right to pay tribute to David Marshall. He was an outstanding Member of Parliament for 29 years, a very assiduous attender of Scottish questions and one who never feared to hold Governments to account, whatever their political persuasion.

The Commonwealth games are a magnificent opportunity for Glasgow, not just for the fact that people from all over the world will come to visit or for the sporting success and legacy but for the massive investment that there will be in the city. We anticipate that up to 5,000 apprenticeship places—2,000 in the construction industry alone—will be offered as a result of the work going on between Glasgow city council and the Department for Work and Pensions. I think that the games will be a success, however one looks at them.

The hon. Gentleman asked about the Olympics, and I encourage all businesses, Scottish-based or otherwise, to bid for the contracts. It is important to look at the value of some of the contracts, and not just their overall number. Scottish companies have won parts of the Olympic business that are of considerable value.

Mr. Brian H. Donohoe (Central Ayrshire) (Lab): May I also put on record my appreciation of the help that I got from David Marshall over the years? He helped me enormously, in this place as well as in my constituency.

I congratulate Glasgow on its successful bid for the Commonwealth games, but will my hon. Friend the Minister also congratulate the work force and management at Spirit Aerosystems in Prestwick? This week, they have won an enormous order worth £900 million, perhaps the biggest to have come to Ayrshire for a generation. With your permission, Mr. Speaker, I should also like to thank my right hon. Friends the Secretaries of State for Scotland and for Business, Enterprise and Regulatory Reform for all the work they have done in winning that enormous order.

David Cairns: The order to which my hon. Friend refers is extremely important for his constituency in Ayrshire and for the whole economy of the west of Scotland. Saving his blushes, I know that he was instrumental in campaigning very hard behind the scenes for that.

My hon. Friend raises a very interesting point. There is already pressure on Scotland’s labour market thanks to the historic numbers of people in employment, but we are preparing for the Commonwealth games and trying to get new apprenticeships in the construction industry. At the same time, the two new aircraft carriers that are due to be constructed in Glasgow mean that there is massive investment in the city, and it is important that we get people with the rights skills and training to take advantage of it.

Pete Wishart (Perth and North Perthshire) (SNP): The Minister will know that almost all the costs of the Commonwealth games will be met by the Scottish Government, with a 20 per cent. contribution from
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Glasgow city council. At the same time, he and his Glasgow colleagues voted to divert some £20 million from Glasgow to pay for the London Olympics, which will have an impact on some of the most vulnerable groups in the city of Glasgow. Will he and his Glasgow colleagues now have the guts to join the Scottish National party in demanding that that money be repatriated to Glasgow, so that we can build a legacy for the Commonwealth games in Glasgow?

David Cairns: I am delighted that the hon. Gentleman is not too grand to debate the issues with me today. Of course, when the Olympic games were won by the United Kingdom for the city of London, the SNP said that the games would do nothing for Scotland, and when the Commonwealth games went to Glasgow, Fergus Ewing MSP said that they would do nothing for the highlands. The insularity and parochialism of the SNP is, quite frankly, breathtaking. The Olympic games will be good for Scotland, good for Scottish athletes and good for Scottish business, and the hon. Member for Perth and North Perthshire (Pete Wishart) should stop whingeing about them.

David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con): May I associate myself with the comments about David Marshall? I should also say that although I fully accept the reasons why the Secretary of State is not present, today is a clear example of why the role of Secretary of State for Defence should not be combined with other responsibilities.

The Minister will be aware that most of the Commonwealth games will be concentrated in the Glasgow, East constituency, where 47 per cent. of people are economically inactive and more than half do not have a single qualification to their name. Does he recognise that Glasgow, East has reached that sorry state after 11 years of Labour central Government and decades of Labour local government? And will he explain to the House, if not to Mr. Salmond, why the Prime Minister refuses even to visit the constituency after attempting to impose—

Mr. Speaker: Order. That part is well beyond the scope of the question.

David Cairns: The Conservatives have just noticed that there is poverty in some parts of the UK. We could have told them that; we have spent the past 11 years combating it. We have seen unemployment halved in Glasgow, East and hundreds of people coming off incapacity benefit and going into work—people who were left languishing on incapacity benefit when the Opposition were in government. There are nine new primary schools, three more on the way and two new secondary schools in that constituency. I know that the hon. Gentleman’s party leader visited it: he went to the church of St. Jude, the patron saint of hopeless cases.

David Mundell: The Minister sounds just like the Prime Minister, and that is not intended to be a compliment. The Minister takes the people of Glasgow for fools; he talks about the past when they are interested in the future. So perhaps he will explain why his party is not campaigning on issues such as economic regeneration after the Commonwealth games. Instead, its campaign, now that it has finally started, is solely about the survival of the Prime Minister.

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Mr. Speaker: Order. I shall try to settle this, and I think that this is the easiest way. The Minister is not responsible for party campaigns. [Hon. Members: “He is.”] Well, let me qualify it further. He is not responsible for party campaigns in this House or in his capacity as a Minister here today. Now, can we get a response that is nothing to do with my native city of Glasgow—the campaign, that is, in my native city of Glasgow?

David Cairns: I entirely accept your admonition, Mr. Speaker.

Throughout the city of Glasgow, we have seen a huge reduction in unemployment and large numbers of people coming off incapacity benefit—people who were put there during the 1980s—and going back into work. We are also going to see massive investment in apprenticeships because of the Commonwealth games and this Government’s decision to build two new aircraft carriers in British shipyards. Glasgow’s Govan and Scotstoun shipyards will take the credit for it.

Mr. Tobias Ellwood (Bournemouth, East) (Con): Five years late.

David Cairns: The hon. Gentleman says, “Five years late.” Has he any idea what his party did to the shipbuilding industry on the Clyde, or the utter decimation that they brought? We are revitalising the industry.

Mr. Speaker: Order. I think I shall try the hon. Member for Argyll and Bute (Mr. Reid).

Fuel Prices

2. Mr. Alan Reid (Argyll and Bute) (LD): To ask the Secretary of State for Scotland what assessment he has made of the effect of recent rises in the price of fuel on the economy of the highlands and islands. [216425]

The Minister of State, Scotland Office (David Cairns): Recent fuel price increases will continue to have an effect across the UK, but the economy of the highlands and islands continues to show resilience, with an employment rate significantly above the UK and Scottish averages.

Mr. Reid: I am a bit worried about the complacency behind that answer, because the recent fuel price rises are causing a real economic crisis on the islands and in the remote parts of the mainland, particularly on the Kintyre peninsula. The situation may not have worked its way through to the unemployment figures yet, but unless the Government take urgent action, it soon will. Owing to the long distances that must be travelled by road, the high fuel price is causing serious problems for business and putting the economy at real risk. Other European countries charge a lower rate of fuel duty in remote areas, so will the Government, as a matter of urgency, introduce a similar scheme in this country?

David Cairns: The hon. Gentleman is right to say that with the global increase in oil prices feeding through into increased fuel prices, people are feeling the pinch, and it is costing people more to fill up their car; we entirely accept and understand that. I know that the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso), who is not here today, has put a
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particular proposal to the Treasury on that issue. I understand that Treasury Ministers are examining it and will get back to him.

Miss Anne Begg (Aberdeen, South) (Lab): I do not know whether my hon. Friend has had time to see Oil & Gas UK’s economic report, published yesterday, which identified that there were at least 25 billion barrels of oil still to be recovered from the North sea. Does my hon. Friend agree that increasing the recovery of that oil will bring down the price and make life better in terms of the economic development of the highlands and islands?

David Cairns: My hon. Friend is entirely correct to say that there is at least 25 to 30 years-worth of viable economic activity in the North sea. We have to make sure that we get that oil out, particularly in areas such as those west of Shetland. Of course, high oil prices are bad for Scotland, for the economy, for businesses and for motorists. The politicians who gloat over high oil prices as though all that they represented was a windfall for the Exchequer, and who use the prices to make their dodgy sums add up, would do well to focus their effort on reducing the cost of oil, instead of trying to divide the spoils as though they were a big cake.

Mr. Ben Wallace (Lancaster and Wyre) (Con): On the subject of dodgy figures, the National Audit Office reckons that for every dollar increase in the price of oil, the Treasury gains £200 million. The National Institute of Economic and Social Research estimates that there is a net gain to the Treasury of £140 million per dollar. That means that with prices at $130 a barrel, the Treasury gets an extra £4.6 billion in revenue. Given that the Chancellor is raking in that extra revenue from the North sea, will the Minister agree not only to fight for the people of Scotland but to use some of the extra money to mitigate the high fuel costs that highlanders and people in the rest of Scotland face?

David Cairns: The hon. Gentleman quotes one review of the issue; let me quote another. The Institute for Fiscal Studies—not an institute that is normally very friendly to the Government—says

As we know, if people spend more money on petrol and the car, they spend less money elsewhere. If high oil prices mean that businesses are having to contract, that means less tax coming from the economy. Overall, I simply do not accept the premise of the hon. Gentleman’s question, which is that there is a windfall from high oil prices. He simply cannot prove that point.

Scotch Whisky

3. Gordon Banks (Ochil and South Perthshire) (Lab): What recent assessment he has made of the contribution of the Scotch whisky industry to the Scottish economy. [216426]

The Minister of State, Scotland Office (David Cairns): The Scotch whisky industry is of massive importance to the Scottish economy, and that is why the Government will this year bring forward new measures to enhance its global protection.

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Gordon Banks: The whisky industry is also vital for skills in Scotland’s economy, and jobs and apprenticeships in my constituency, including those relating to coppersmiths. Will my hon. Friend urge the Scottish Executive to invest in those skills and protect the jobs in Ochil and South Perthshire?

David Cairns: My hon. Friend is correct. There are some 45,000 jobs across Scotland directly dependent on the Scotch whisky industry, which is responsible for putting some £800 million into the Scottish economy, so it is an extremely important sector. My right hon. Friend the Secretary of State visited Alloa recently. They are good, skilled jobs; they are the kind of jobs that Scotland needs, which is why it is deeply disturbing that instead of investing in skills and apprenticeships, the Scottish Executive are cutting apprenticeships.

Malcolm Bruce (Gordon) (LD): Will the Minister join me in welcoming the fact that planning permission has been granted for a new distillery, which is to be built in the town of Huntly? Will he recognise that the strength of the investment made there depends on a strong and healthy industry, and the export industry, and that increasing duty on whisky in future Budgets would not help the current resilience of that success?

David Cairns: The export bit of the industry does not pay that duty, and 90 per cent. of the value of Scotch whisky comes from the export market, which does not pay that duty. I am afraid that the right hon. Gentleman is quite simply wrong on that. As I said in my initial answer, the export market—the international global market—is absolutely vital. That is why we will bring forward measures later this year to enhance the protection of Scotch whisky brands throughout the world, and ensure that the Scotch whisky industry has a stronger case if it needs to go to the World Trade Organisation. I sincerely hope and expect that his party will support those measures when they come forward.

Angus Robertson (Moray) (SNP): The Minister will surely concede that raising duty undermines the efforts of the Scotch Whisky Association and others who are arguing to the likes of the Indian Government that they should reduce duties.

I should like to raise another issue related to whisky. The Minister knows that Moray is home to more than half of Scotland’s malt whisky distilleries and production. Does he share my enthusiasm for the current efforts to boost significantly the industry’s tourism and economic benefits for the local area?

David Cairns: The hon. Gentleman is right to suggest that there is tremendous tourism potential around the distilleries. More than 1 million visitors visit them each year, and they spend an average of £16 each visit, which is tremendously important. I have been to the Glenfiddich distillery in his constituency, where there is a beautiful visitor centre. We were offered a dram, but it was 9 o’clock in the morning so sadly we had to refuse. He is right to say that there is room for increased tourism potential. I shall have a look at the report that he mentions, and I hope that everyone will take it seriously.

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