Meeting of the Parliament

Meeting date: Thursday, April 22, 2010

Official Report 1132KB pdf

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Economy

The next item of business is a Labour Party debate on motion S3M-6174, in the name of Andy Kerr, on the economy. We do not have a lot of time available, so members should keep to their times. Mr Kerr, you have 13 minutes.

09:16

Put quite simply, the inadequacy and incompetence of Mr Salmond and Mr Swinney in the Scottish National Party Government have cost thousands of Scottish jobs and robbed families of pay packets, all because of the fiasco and the political fig leaf that is the Scottish Futures Trust. The SNP started out with a rash promise in a manifesto laden with false promises. That has led us to the Salmond slump. Nowhere is that more evident than in our construction sector.

I remind SNP members that page 19 of their manifesto said:

“we will introduce a not-for-profit Scottish Futures Trust”.

As far back as August 2007, Alex Neil—then a regular “Newsnight” presenter for the SNP—said that the SFT would be up and running within three months. In 2008, John Watt of Grant Thornton told us:

“It is uncertain; we just do not know what SFT will look like.”

Some things just have not changed. He went on:

“The last date that I heard for SFT having its own funding capability was 2010, which is quite a way off. People will not be able to hold on until 2010 in the hope of seeing a pipeline then.”—[Official Report, Economy, Energy and Tourism Committee, 29 October 2008; c 1129.]

 

There has been no clarity, no pipeline and no funding subsequently.

Around that time, the managing director of Mactaggart & Mickel Ltd said

:

“While the Scottish government ponders how the new Scottish Futures Trust might provide an alternative to Public Private Partnerships (PPP), thousands of valuable construction jobs in Scotland are in jeopardy. Immediate and concrete proposals on the SFT will ease uncertainty.”

Of course, the uncertainty was not eased and the jobs were lost. He went on:

“we implore the Scottish government to consider the plight of thousands”

of skilled workers. Perhaps the Scottish Government considered their plight, but it did not act. As ever, it was all talk and no action.

I am glad that Mr Mather has made a guest appearance on behalf of Government ministers today. When he appeared before the Economy, Energy and Tourism Committee in November 2008, Lewis Macdonald asked him:

“When will the Scottish Futures Trust be fully established? When will the first project go to market?”

Mr Mather replied:

“It will be established as soon as possible.”

Complacent as ever he went on, but Lewis Macdonald questioned him further:

“Do you expect contracts to be let in this financial year?”

The financial year in question was 2008-09. Mr Mather said—wait for it, folks—in his reply:

“I have a folk memory that that will happen.”

Lewis Macdonald asked:

“Are you confident that it will happen?”

Mr Mather said:

“I have been told that it will.”—[Official Report, Economy, Energy and Tourism Committee, 5 November 2008; c 1231.]

 

Mr Mather was told wrong. It did not happen.

What of the First Minister and the Scottish Futures Trust? Mr Salmond said that capital would be raised

 

“from the issuing of both specific project bonds and general Scottish Executive bonds”.

He went on to say—this would be funny if it was not so serious:

“Candidates for inclusion might be a bullet train on the Shotts line between Edinburgh and Glasgow, and”—

this is irony beyond irony—

“a train link between all three central belt airports, dualling the A9 and the trunk-road network in the South-west and North-east, supporting super-port developments at Hunterston and Scapa ... and electrifying the Glasgow- Edinburgh-Aberdeen rail triangle.”

We have a fantasist First Minister and cruel deceiver who has cost thousands of jobs here in Scotland.

The original concept of the Scottish Futures Trust providing Scottish Government bonds for conventional public financing of infrastructure has, in Unison’s words, evolved into an “expensive quango”. The business editor of The Sunday Times said

that it was

“hard to spot the difference between the outgoing scheme”—

the public-private partnership scheme of the previous Government—

“and plans for a Scottish Futures Trust”.

There is a difference: the Labour Government in Scotland delivered on schools and hospitals, whereas the SNP Government has not.

So where are we now, to bring the matter up to date? Just last week, the Scottish Chambers of Commerce published a report that highlights the fall in the volume of public sector contracts that the SNP Government has presided over. That report is a total embarrassment for the SNP. In 2007, the value of public sector contracts in Scotland was £1.3 billion. Under the SNP, because of the failure of the Scottish Futures Trust, that fell to £303 million in 2008 and £508 million in 2009. That represents a cumulative fall of £1.8 billion in capital spend. Using the Scottish Government’s own mystifying model—the input-output tables that the Government uses to calculate the impact of its spend on the economy—we see that the employment impact of the £1.8 billion drop in capital spend is equal to 27,200 jobs. This so-called Government has seen jobs lost, families going short and dreams of apprentices turned into nightmares.

The Scottish Futures Trust is not fit for purpose—we all know that—and it was founded on a manifesto promise that is not just broken but shattered. We have a Government that was elected on a false prospectus.

We have seen skilled Scottish workers put out of work, families struggling with smaller pay packets or no pay packet at all and apprentices losing the opportunity to train for the future. One in 10 construction workers has lost their job as a direct result of the Salmond slump. Just last week, Garry Clark of the Scottish Chambers of Commerce said

:

“Construction remains in difficulties, and of particular concern is the apparent fall in the volume of public sector contracts. It underlines the need for the Scottish Futures Trust to rapidly expand its delivery of capital infrastructure projects throughout Scotland.”

The fundamental point is that no one knows what the Scottish Futures Trust is trying to do and how it will do it. The construction industry is in crisis because of the hiatus in building projects. The delay is putting off both international and local contractors from investing in Scotland. The delay has led to, and is leading to further, flights in expertise from Scotland. Any projected—somewhat fictional, I think—savings that the Government has claimed for the Scottish Futures Trust are currently being lost through construction inflation.

Let us look at one aspect of the SFT’s programme—the schools programme. Setting aside the nonsense of the SNP’s claim that the schools that are being opened now have anything to do with the SNP Government, let us look at what the Government has announced. In June 2009, it announced 55 new schools, of which 28 were to be secondaries. In the next announcement, mention was made of only 14 secondaries. However, funding has been given for only three of those. How many will have been built and opened in the current parliamentary session? Zero. No schools have been delivered. So much for matching Labour’s promise “brick for brick”.

The representative from Grant Thornton told the Parliament:

“There is a massive change in the pipeline”.

 

That massive change was that the money had gone. In response to a question, the representative from the Scottish Building Federation said:

“We are already there. If we do not take action now, there will be no point in doing so in six months’ time”.—[Official Report, Economy, Energy and Tourism Committee, 29 October 2008; c 1128, 1133.]

 

That was back in late 2008. No action was taken, and the predictions have come true. The warning signs were there, but there was no response from the Government. We are losing expertise in our construction industry and in other industries throughout Scotland.

The Scottish Government’s flagship organisation published its “Scottish Futures Trust—Business Plan 2009/10”, which, as ever, contains a bit of irony. It states:

 

“The significance of the construction industry to the local and national economies is also recognised.”

Well, it might be recognised, but neither the SFT nor the Scottish Government is doing anything about it. It gets better: the business plan has the cheek to list 16 projects in major activity areas. It is responsible for the delivery of only three, two of which were inherited from the previous Government and the other of which is a quango.

If we look at the situation more closely, we might ask what involvement the Scottish Futures Trust has had in the Forth crossing or the Southern general hospital. The Government’s flagship organisation, which has cost taxpayers millions of pounds, is not even involved in the two biggest infrastructure projects in Scotland.

The real tragedy is that the delay and the dithering of the Government have caused real and untold damage not only to the workers in the construction industry, the steel industry and the professional services that support construction but to children and to patients in our national health service, who deserve better infrastructure. We are calling either for the SFT to be scrapped or for the SFT and the Government to get their acts together.

The Salmond slump goes far wider than the construction industry. Professional services and financial services have been affected, as has the steel industry, which relies heavily on work in the construction sector. Of course, quite ironically, much of the product of the Scottish steel industry was exported to England and elsewhere due to the fact that we had the Salmond slump in Scotland. We have lost the opportunity for the Scottish construction and steel industries to prosper in Scotland. This week, Bone Steel in Lanarkshire went into administration—a company that, 18 months ago, appeared on Newsnight and said that orders were relatively good but that it was doing no business in Scotland because of the SFT, and that the steel that it was making was being sent down to England to build schools and hospitals there.

The figures around our construction industry are damning of this Government. Our gross domestic product figures tell us that the construction sector fell by 10.8 per cent in the year to the end of December 2009. In the fourth quarter of 2009, the service sector and the production sector grew, but the construction sector fell by 2.8 per cent—all as a direct result of this Government’s inadequacy and incompetence.

During this debate, I want to call on members to support Labour’s campaign for every young person in Scotland to be given the right to quality training. The campaign is gathering momentum. We have support from major trade unions and business organisations, including the Scottish Chambers of Commerce. Our demand is for every young person in Scotland with suitable qualifications to have the right to an apprenticeship. This is an opportunity for us to speak up for the next generation and make a clear statement that every young person should have the right to quality training.

It is quite unacceptable that more than 700 apprentices from the construction trades have lost their jobs in the past year. Those young people are being deprived of skills and the opportunity to train for the future needs of Scotland and our industries.

The Scottish Chambers of Commerce has said that it is

“strongly supportive of continued investment in apprenticeships”.

Unite’s regional secretary, John Quigley, said:

“The economy is now on the road to recovery, but sustaining growth means we have to invest in skills. That’s why Labour’s commitment to give young Scots the right to quality training is so important.”

The Scottish regional secretary of the Union of Construction, Allied Trades and Technicians said:

“The construction industry is losing confidence in the Scottish Government. We have now waited two years for them to make the Scottish Futures Trust fit for purpose and their failure to bring forward new jobs is creating a major gap in the market.”

The Scottish regional director of Community said:

“We think this is a great forward thinking initiative and we are delighted to give it our support.”

At the heart of this debate is the cynical incompetence of this SNP Government; the promises that it made in its manifesto and the announcements that it made later about how the Scottish Futures Trust would deliver for Scotland; a pipeline that has been emptied of more than £1.8 billion; 27,200 jobs that have been lost; and a look of shame on the faces of Scottish Government ministers and their backbenchers. The SNP has failed to deliver, and it is about time that it stepped up and delivered for the construction industry in Scotland.

I move,

That the Parliament notes the recent comments from the Scottish Chambers of Commerce that construction remains in difficulties and that the apparent fall in volume of public sector contracts is of particular concern; notes further its call for the Scottish Futures Trust to rapidly expand its delivery of capital infrastructure projects throughout Scotland and regrets that the Scottish Government’s failure to ensure a steady stream of capital infrastructure works has led to the loss of nearly 30,000 jobs in the Scottish construction industry and a massive downturn in the order books of suppliers such as the structural steel industry; welcomes additional funding for housing in the UK budget; notes that 720 construction apprentices have lost their jobs as a result of the downturn in the industry, and calls on the Scottish Government to provide every young person with the right to quality training, including advanced apprenticeship or technician level training for those who are qualified.

09:29

I am grateful for this opportunity to debate the Scottish economy and cut through the cynical and incompetent smokescreen that we have just heard.

I am somewhat at a loss to explain why the Labour Party would want to remind us of its recession and its regulatory race to the bottom that created it.

Will the member give way?

Let me build my argument.

We all know the price that real people are paying for the financial crisis, the bonus culture and the greed that the Labour Party unleashed, with financial players succumbing to the moral hazard of unethically boosting short-term profits in order to boost their bonuses and the United Kingdom Government living in the false belief that that could continue.

Will the member give way on that point?

Let me make the case.

What happened? Elements of the financial sector acted greedily because of the incentives and opportunities to do so that were delivered by the Labour Party. Why did that happen? There was a flawed system of corporate governance. There was a major moral hazard. The UK financial markets failed to perform their essential societal function of managing risk, allocating capital, mobilising savings and keeping transaction costs low. They were also working in the belief that the UK Treasury would bail them out.

Brown, Blair, Darling, the Financial Services Authority, the Bank of England and the Treasury let all of that happen—Gordon Brown admits it. The final word—[Interruption.] The final word does not come from Labour members in this chamber; it comes from Bob Thomson, who said:

“After 15 years of new Labour, what have we achieved? We have the biggest deficit in history”—

[Interruption.]

Order. Can we cut out the constant sedentary commentary that is going on? Mr Kerr was listened to in reasonable silence, and the minister should be accorded the same courtesy.

No wonder they want to block out what they are hearing.

Bob Thomson said:

“People say Gordon Brown saved the banking system, but that’s like thanking an arsonist for putting out the fire he started. From any objective standard, he’s been a disaster.”

On the subject of the regulatory race to the bottom, does Mr Mather condemn the First Minister for talking of the gold-plating of the financial services sector in the UK and John Swinney for saying, in a policy document that was published prior to the previous election, that Scotland must change its regulatory environment and make it more attractive to the financial services sector? The regulatory race would have reached lower levels in the hands of the SNP.

Certainly not. We were entitled to expect that the FSA, the Treasury, the Bank of England, the US Federal Reserve, the US Treasury and the US Securities and Exchange Commission were doing a proper job, but they were not; they were absent and they missed what was happening.

We have a UK Government that was able to fail during a global boom and is now trying to obliterate its inept handling of that boom. It wants to hide its responsibility for the financial services crisis and is attempting to lay the responsibility at the door of an SNP Government that has made the best of an outrageously poor pass from the UK Government. The result of Labour’s policies is the biggest downturn in recent memory, and its members in this chamber seem to be cheery about it.

I am sure that members will join me in welcoming news that the Scottish economy has now moved out of recession. The latest statistics, released yesterday, show that output in the Scottish economy grew by 0.2 per cent in the final quarter of 2009. That return to growth comes after five consecutive quarters of falling output, which is one quarter shorter than the recession that was experienced in the UK. The recovery has been driven by the production sector, as Mr Kerr mentioned, with output expanding by 0.8 per cent, and the service sector. We welcome the return to growth, the fall in the numbers of those claiming jobseekers allowance and the fact that we are enjoying positive employment rates in Scotland compared with the rest of the UK.

Given that Scotland’s GDP fell more deeply than the GDP of the rest of the UK during the recession, was the First Minister right to say that Scotland would weather the storm better than other parts of the UK?

The negativity of the Liberal Democrats on this matter never fails to surprise me. Do they not worry that they might damage confidence, investment and growth?

Rightly, the construction sector has been the focus of attention today. It has undoubtedly felt the effects of the global downturn, which is why the Scottish Government has repeatedly called on the UK Government to allow further acceleration of capital expenditure into 2011-12. Had Alistair Darling accepted that request, that money would have supported 5,000 jobs in Scotland, most of them in the hard-pressed construction sector.

The minister will recall that there was some accelerated capital and the SNP Government spent 40 per cent of it on land. How did that create any construction jobs?

We are moving on, and we have a situation in which the capital expenditure in Scotland has gone from £3.1 billion, when Labour was last in office, to £3.782 billion, which is an increase of £655 million.

There are new and refurbished schools and social work facilities, new recreation facilities and a range of key infrastructure projects. That is helping communities and businesses. Other projects that are under way include schools in Inverclyde, Dumfries and Galloway and West Dunbartonshire, the new NHS Forth Valley acute hospital, NHS Fife’s Victoria hospital project, the M74 completion, the M80 Stepps to Haggs development and the Airdrie to Bathgate rail link.

Through the economic recovery plan, we are meeting the challenge of the recession head on. We have used all the levers at our disposal to support Scotland through the current times. The latest upgrade of our recovery plan was published on 3 March and debated in the Parliament last week. The plan, which remains firmly aligned with the principle that was laid out in the Government’s economic strategy, directly supports 15,000 jobs and sets out actions to accelerate the Scottish recovery and ensure that we can secure increases in sustainable economic growth in the longer term.

The plan focuses on three key areas: investing in innovation and industries of the future; strengthening education and skills; and supporting jobs and communities. However, the recovery is at a fragile stage, so the latest economic recovery plan sets out plans to accelerate it. The priorities in that are the transition to a low-carbon economy, which I believe has wide support in the Parliament; a focus on internationalisation; further planning reform; improving access to finance; a renewed focus on commercialisation; and managing labour market pressures. As part of the plan, we have brought forward capital expenditure to the fullest possible extent. The capital acceleration of £350 million has supported more than 5,000 jobs, including the 3,000 in the construction sector that I mentioned earlier.

Infrastructure is a key issue. The Scottish Government is maximising its capital spend to support infrastructure investment throughout Scotland. This year, Government capital spending is £3.3 billion. On 14 April, the Cabinet Secretary for Finance and Sustainable Growth announced a £76 million allocation of consequentials from the UK budget to support a wide range of projects, including £31 million for affordable housing development and £17 million that is earmarked for investment in further education colleges—for existing work at Dundee College and enabling an early start to construction of Forth Valley College’s new campus. Ultimately, our infrastructure investment is estimated to support 50,000 jobs in the Scottish economy, including 30,000 in the construction sector.

On the Labour record, Hairmyres hospital, which Jim and Margaret Cuthbert famously called

“one hospital for the price of two”,

actually helped to create the Scottish Futures Trust. That was the driver. The Scottish Futures Trust recently published its 2010-11 business plan, setting out ambitions and positive objectives for the current financial year. Those include supporting the delivery of 16 key programmes and projects that the SFT estimates are worth about £7.3 billion. The flagship SFT projects that are under way include the hub programme, which is bringing together the public and private sector to deliver about £1 billion of community infrastructure in the next 10 years. The SFT has proposed to deliver a minimum level of £7 in benefit per £1 spent.

On skills, every business and community in Scotland has been affected by the recession. The on-going employment pressures in Scotland highlight continued risk. Skills investment and training opportunities continue to be a priority. Our skills strategy was put into action to manage the immediate impacts of the downturn, but it was also designed to bring long-term benefit to the economy. We believe that skills development, particularly through the apprenticeship programme, is of paramount importance to a strong economic recovery. We all know that training equips people with the skills that are needed for long-term employment, which is why we have developed the most comprehensive package for apprentices in the UK. We have invested £145 million to help unemployed people enter the labour market, to help employers develop workforce skills and to support further redundancy moves from work to work.

Will the minister say why 63 apprentices in Fife have lost their jobs and why the Government is withdrawing vital programmes that could support those people through their training?

That is more evidence of Labour’s recession. Labour fails to recognise that we have exceeded our target of 18,500 modern apprenticeships and delivered more than 20,000 of them. We are moving on and making things happen. Keith Brown will go into more detail on that in his closing speech. A lot is happening on learning choices for those aged 16 plus, although we could do more.

We continue to feel the impacts of the recession and we will do so for some time. We must not put the recovery, which is in its fragile early stages, at any greater risk. We would like to do even more, and we could do more, but we are being stymied by the UK Government. Not only has it created the recession, but it refuses to bring forward capital expenditure. The latest rise in the Scottish unemployment rate to 7.8 per cent illustrates that the effects of the recession are still being felt. Continued support is needed to prevent a further rise in unemployment. Support should be withdrawn only when private sector demand has recovered sufficiently. Argentina is one of the few countries to remove its fiscal stimulus this year. The UK budget was clearly a missed opportunity. Given the fragile nature of the recovery, now is not the time to withdraw support for the Scottish economy.

I move amendment S3M-6174.3, to leave out from first “and” to end and insert:

“; notes that growth is returning to the Scottish economy but that the recovery is still fragile and significant challenges remain as Scotland seeks to consolidate recovery, and calls for the Scottish Government to work with all sectors in Scotland to further build on recovery from Labour’s recession.”

09:40

The recession might finally be over, but it was deeper than that in the rest of the UK. The trends in unemployment are worrying. We in the Conservative party accept that the recovery is fragile. A recovery that is so fragile that it depends on borrowing £170 billion and which would allegedly be snuffed out if borrowing was £164 billion is hardly the stuff of which Labour should be boasting. The biggest threat to our economic future is that of a failure to deal with the legacy of debt that Labour has run up before it finally spins out of control—the debt that is, rather than Labour, which has been spinning out of control for most of its time in office.

Scotland has specific problems. The business start-up rate has consistently been lower than that in the rest of the UK. We need to encourage entrepreneurship and build an economy that is not as dependent on the public sector. Scotland’s two Governments need to work together to tackle the legacy of the recession and get the economy moving. As Labour proves every time it is in power, Governments can easily destroy jobs, but it is much more difficult to create them. Job creation will come only from a thriving private sector.

We believe that Labour’s jobs tax will cost jobs and must be stopped. In Scotland, at least 5,000 families face losing a breadwinner if Labour’s plans are allowed to take effect. We should not forget that, as well as businesses and the self-employed, charities, schools and the national health service would be hit hard by the proposal, with a cost of £63 million to the devolved public sector in Scotland alone. That is money taken out of public services by Labour’s jobs tax. Labour politician after Labour politician tell us that increasing the tax on jobs will not hit employment levels. In 30 years, we have gone from Labour isn’t working to Labour isn’t thinking—I hope that, in a few weeks, we go to Labour isn’t governing.

Increasing tax seems to be a popular theme at the moment. As the Labour motion states, and as Andy Kerr correctly pointed out, the construction sector has been particularly badly hit. However, even the Labour Party does not want to impose VAT on new homes. The Lib Dems clearly believe that not only council tenants should lose the right to buy. Scotland has many problems, but the price of new homes being too low is not one of them. Perhaps the proposal is a way of drawing more homes into the Lib Dems’ so-called mansion tax, which we are told would fund a £17 billion tax cut, despite the fact that only 500 homes in Scotland would be affected. Whatever the reason for the plans, Scotland would be hit hard by those moves. If any Government abandoned zero rating for new homes, European Union rules would impose a minimum rate of VAT of 5 per cent and no future Government would ever be able to go back to the current position of no VAT.

The chief executive of Homes for Scotland, Mr Fair, has noted:

“Somehow, the Liberal Democrats seem to be unaware that Scotland, not to mention the UK as a whole, is facing its worst housing crisis since the Second World War.”

To be fair, the Lib Dems seemed to be unaware that the plan was in their manifesto—at least, Tavish Scott was—so it is not isolated ignorance. Mr Fair went on to say:

“Not only has our industry lost up to half its workforce, development is touching an all-time low and vital first-time buyers are struggling to find deposits of up to 25 per cent. Any measure increasing the cost of new homes, whether in the public or private sector, is sheer madness and will simply exacerbate the problems we as a country already face.”

Sheer madness is probably the greatest accolade that has been given to a policy in the Lib Dem manifesto. We should think carefully when everybody recognises that there is a shortage of accommodation and there are pressures in relation to family housing. House price inflation will be rampant if we do not tackle the shortage of accommodation. Increasing tax on new homes is not the way to do it.

The Conservatives’ “Blueprint for a Green Economy” states:

“In the UK, the rates of VAT are heavily weighted in favour of demolition and new build as opposed to refurbishment ... In the long run this is, in any case, a damaging distortion in terms of retrofitting and improving rather than demolishing the stock. We believe that we should seek ways to move away from the present situation to one which is more balanced.”

Does Mr Brownlee agree?

The contrast between the Conservatives and the Lib Dems is that we do not think that every problem is handled by increasing tax. We certainly would not impose VAT on new homes, which would add £14,000 to the cost of a typical starter home in Scotland.

The First Minister has not been shy about lecturing the UK Government on VAT policy. Our amendment simply asks the Scottish Government to make clear that VAT on new homes would be bad for Scotland. Just as we believe that VAT on new homes is a tax hike that Scotland does not need, so we believe that it is wrong to return business rates to local council control. Many local authorities in Scotland cannot raise from local businesses anything approaching the amount of money that they receive under the current distribution formula. A massive increase in business rates would be required, including for small businesses.

The figures are startling. Businesses would pay 69 per cent more in Aberdeenshire, 72 per cent more in Argyll and Bute, 110 per cent more in East Dunbartonshire, 20 per cent more in Fife and 96 per cent more in the Scottish Borders and Angus. In East Renfrewshire, the figure is 190 per cent.

Given that it is not the Government’s position to return business rates to local council control, does the member have other parties in mind?

I am sure that the Liberal Democrats will explain why they want to increase business rates in Argyll and Bute by 96 per cent. I am sorry, the figure is 72 per cent—I must not exaggerate the position. No one disputes the figures that I have given. I would be grateful if the minister would confirm—as he seems to have done—that the Scottish Government rules out any plans to return business rates to council control.

I am not sure that I follow Mr Brownlee’s line of argument. Is he saying that local government in East Dunbartonshire is responsible for the problem? If so, has he discussed the matter with the deputy leader of East Dunbartonshire Council, his Conservative colleague Councillor Billy Hendry?

I am saying that East Dunbartonshire receives substantially more in business rates revenue than it could raise locally. Mr Whitton should speak up for businesses instead of joining the Liberal Democrats in trying to hammer them. We should look at how we can reduce business rates.

Today, the Parliament has a chance to send the clear message that we reject Labour’s jobs tax, that Scotland does not want the Lib Dems’ plans for VAT on new homes or their crazy scheme to increase business rates across the country by returning the rates to local control, and that instead we want to let businesses get on with creating jobs and to help families to get on to the housing ladder. The recovery is fragile. Any one of Labour’s jobs tax, the Lib Dems’ VAT bombshell or the Lib Dems’ business rates rise would damage the Scottish economy, put the recovery at risk and cost jobs. A combination of all three would be utterly toxic.

I move amendment S3M-6174.2, to leave out from first “and” to end and insert:

“; notes that an increase in the rate of VAT for new homes would significantly compound these difficulties, as would further increases in national insurance contributions; asks the Scottish Government to make representations to the UK Government to try to prevent such tax rises, and calls on the Scottish Government to take action on the economy within its own powers by ruling out the transfer of business rates to local authorities, which would significantly increase bills in many parts of the country, including Aberdeenshire, the Borders, East Dunbartonshire, Argyll and Bute and Fife among many others, and by considering the scope within existing revenue projections to extend business rate relief for small and rural businesses.”

09:48

It is a curious election campaign when the Liberal Democrats are love bombed by the Conservatives and the Labour Party one day and carpet bombed the next. There is no misunderstanding among the electorate. They want parties in the election campaign to put forward their approaches and to allow people to make up their minds. Two weeks ago, in an attempt to woo Liberal Democrat voters, Kenneth Clarke said that Nick Clegg was essentially a Conservative. Now, in an attempt to terrify exactly the same electorate, he says that, under anything other than a George Osborne chancellorship, the International Monetary Fund will be called in. The electorate want parties to put forward positive solutions.

When I spoke to secondary 5 and 6 pupils at Galashiels academy on Monday, the economy—more specifically, the economy in Scotland over the next decade—was at the top of their list of concerns, and understandably so. They hear and see the figures that make it clear that the Scottish economy performed worse in the recession than that of the United Kingdom as a whole. It is consolation that the economy grew in the last quarter of last year, but it did so at half the growth rate of the United Kingdom. It is no surprise, given the profile of public sector employment in Scotland, that the overall claimant rate is slightly better than that for the United Kingdom. However, those people who have lost their jobs in the construction sector, among others, and want to get them back are looking for ways in which we can have a balanced economy that is fair, that does not reflect a traditional view of public and private and in which those who did not cause the recession are not primarily those who pay for it.

The economy is critical to the 120 young people to whom I spoke, who are seeking policy approaches. Some have been presented this morning and have been part of the election campaign; there is no mistake about that. In their amendment and in nearly all of Derek Brownlee’s speech, the Conservatives attack us for our proposals for a different taxation system for business in England, but their approach to local government in Scotland is different from their approach in England. They also have different approaches to schooling and education. In their manifesto for England and Wales, they propose setting up free independent primary schools, but they explicitly rule that out in Scotland. When challenged on the point, they say that devolution is the reason for the difference and that there are different circumstances and positions in Scotland.

Does Mr Purvis agree that the introduction of minimum unit pricing of alcohol is proposed in the Liberal Democrat manifesto for the United Kingdom but ruled out by the Liberal Democrat party in Scotland?

I disagree neither with the Conservatives having different approaches to primary schools in Scotland and in England and Wales nor with other approaches that provide devolution answers. When I asked Liz Smith why the Conservatives took a different approach to education in Scotland, she answered that the reason was devolution. If the Conservatives take one policy from the Liberal Democrats’ UK manifesto and argue that it applies to Scotland, they must say that any federal party should take the same approach in Scotland and England, but they do not do that.

This week, when they launched their manifesto in Melrose, in my constituency, the Conservatives’ refrain on the economy was that the Liberal Democrats pose the most danger. I will look at a couple of the issues that they have raised, principally rates and building development.

Call it VAT.

On VAT, I quoted accurately from the Conservative policy document “Blueprint for a Green Economy”. The group that produced the document was chaired by John Gummer, and the document was written by the Conservative candidate for Richmond Park, Zac Goldsmith. It states:

“In the UK, the rates of VAT are heavily weighted in favour of demolition and new build as opposed to refurbishment ... In the long run this is ... a damaging distortion ... we should seek ways to move away from the present situation to one which is more balanced.”

Harmonisation is the approach. If VAT is charged at 17.5 per cent in one area and at zero in another, how can the figures be balanced by keeping the zero rate at zero? Are the Conservatives saying that they would remove VAT on renovations entirely?

I know that this will come as a shock to the Liberal Democrats, but it is possible to reduce VAT in one area without increasing it on new homes and adding £20,000 to the bill for every first-time buyer. The member said that he wanted to pass on the cost of the recession to those who were responsible for it. First-time buyers did not start the recession.

If the Conservatives have an uncosted commitment, they may be able to do what the member suggests, but I do not understand how they can balance the rates by keeping one of them at zero. Last February, John Purvis MEP called for specific targeted reductions for services such as renovations to homes. That was consistent with the Conservative approach by John Gummer and Zac Goldsmith, which was to balance rates between 17.5 per cent and zero. We need an injection of resources into the replacement and repair of existing building stock.

The big driver with regard to properties in Scotland is land price inflation. In the Borders, Mr Brownlee and Mr Lamont have done two things in the past few years. First, they have criticised the new greenfield developments that are included in local planned zoning for housing. Secondly, they have said that a rapid increase in property inflation is not sustainable. At the same time, there has been difficulty regenerating properties in towns—the centre of Galashiels, Hawick, Selkirk and Peebles. Why should someone who tries to put a new insulated roof on their house and make their home warm and accessible to people with disabilities be faced with a £20,000 tax bill? If Mr Brownlee thinks that the average or typical house price is £201,000 for first-time buyers, that is simply not the reality.

Finally, the Conservatives’ position on rates increases would be more credible if they were honest and admitted that businesses are facing rates bills that have gone up by 50, 100, 150 and 200 per cent. Businesses have received such bills, and the Conservatives have supported them by backing the SNP’s position of offering no transitional relief support. Funnily enough, the Conservatives are supporting that in England.

I move amendment S3M-6174.1, to leave out from “welcomes” to end and insert:

“regrets that the UK GDP fell by 4.6% and the Scottish GDP by 4.8% over 2009; further regrets that unemployment in Scotland continues to rise at a faster rate than in the rest of the UK, and notes that the UK economy grew twice as fast as the Scottish economy during the fourth quarter of 2009.”

09:55

The debate is an opportunity for us to discuss how we can help to move Scotland out of recession. The SNP Government must put in place the right support and leadership to make that happen. Talking about what needs to be done is not the same as doing it, and saying that something is being done when it is not is even worse than that.

The SNP Government’s record is appalling. We are suffering the Salmond slump because the SNP Government is simply not interested in using all the powers that are available to it. Blaming everyone else for its own inaction is much easier.

The SNP has let down every part of the construction industry. I have spoken to a constituent who was angry that his job was to get rid of apprentices—who were doing really well—because there were no public sector jobs in the area in which his big company could bid. His job was to identify young people who had worked hard to get their apprenticeship and sack them. He was angry with the SNP Government because he knew exactly who to blame for the lack of contracts for which the company could bid.

In Edinburgh, we are not getting the investment in new schools that we need, and we are falling further and further behind in building the houses that we need to solve our housing crisis. We have seen failure not just with new houses. There is complete agreement across the chamber that we need investment now to refurbish our homes, to insulate people from the massive rises in fuel prices that they have experienced to date and that they will experience in future, and to cut our carbon emissions. That is the obvious place to start. When Obama got into power in America, one of his first acts was to get shovel-ready programmes in place. His top priority was energy efficiency programmes, which should have been our priority.

Does the member not understand cause and effect, the impact of the financial crisis and the property crash on the Scottish economy, or the currency depreciation that caused the fuel price rises?

I will make two points. First, fuel prices were well on the way to increasing before the current financial crisis. Secondly, banks in this country have had to be bailed out, and we should be proud of the fact that our Government acted on that.

Energy efficiency should have been our priority. I ask the minister whether these words ring a bell:

“implement measures to improve Scotland’s energy use through the Energy Efficiency Action Plan, which is a key part of the Scottish Government’s Climate Change Bill.”

That is pledge 7 of the Government’s 10-point plan, first published in February 2009, to ensure that the energy industry aids the economic recovery. There is a serious gap between promises and the reality. We are still waiting for the energy efficiency action plan to materialise, and half of the amount budgeted to be spent in this year’s energy efficiency programme is still to be spent with one month to go. I wonder whether the minister would like to report today on the current rate of progress in that context. Perhaps not.

My proposals for a national council tax discount scheme had the potential to create thousands of new jobs, but the SNP watered them down so that there was a much less ambitious approach that left it up to somebody else—local authorities—merely to have schemes in place. There is no leadership, no national targets, no drive and no ambition on the ground from the SNP Government.

In Edinburgh, all the schools that have been opened since the SNP Government came into being were commissioned by the previous Labour-led Scottish Parliament. We are still waiting for the next generation of schools. By the way, there has been absolutely no sign of the SNP’s manifesto commitment on a renewable energy installation in every school. Even the Cabinet Secretary for Education and Lifelong Learning has not been able to answer the question about that. Given the lofty soundbites, the globetrotting to Copenhagen and the big manifesto commitments on climate change, the SNP Government’s abject failure to put in place basic energy efficiency mechanisms that could create thousands of jobs in the construction industry is absolutely breathtaking. We know that our new homes will be built to higher standards, but the SNP Government should be doing more now to give the construction industry new apprenticeships and training schemes to let it meet those radical ambitions. Manufacturers also need to be confident that there is a market for their new renewables goods. The delays in getting going on the renewables revolution in households and communities have been disastrous for companies, which have waited for the SNP Government to act.

Will the member take an intervention?

No. I will move on, if Patrick Harvie does not mind.

The last three years have been a huge missed opportunity. The most recent disappointment has been the Scottish Government’s handling of the boiler scrappage scheme. The UK Government announced that it would follow up the massive success of the car scrappage scheme with a boiler scrappage scheme for England and Wales. I ran a petition on the matter that gained thousands of supporters. Colleagues reported that constituents had got in touch because they had seen the television adverts that said that there was to be a boiler scrappage scheme. They could not believe that they were not eligible because they lived in Scotland and an SNP Government was in charge. No one in the plumbing industry understands why Scotland has taken so long and why we have missed out. Plumbing companies have reported that people have been delaying putting in new boilers because they are waiting for the scheme. They have been told that there will be a scheme, but not when.

There is confusion and delay, and there has been damage to the industry. A scheme has been announced this week, but it is three months late and is not as ambitious as it should be. That is a classic case of SNP ministers believing their own hype. Read the small print. Apart from the fact that it has taken three months for the SNP to get a scheme going—Labour down south has announced and delivered a scheme in that time, and people in 125,000 houses there now know that they are getting a boiler—only 5,000 houses will be covered in Scotland. That is not even as ambitious as Wales has been. More money and the same number of boilers are being offered in Wales, which has a population that is 60 per cent of Scotland’s population. After all this time, would it not have been better to fund the scheme properly? Would it not have been better to use the money left in this year’s energy efficiency scheme? We need more money.

Members should support the Labour motion. Let us unite and ensure that the Salmond slump is not allowed to continue.

10:02

When I first read Andy Kerr’s motion, I decided to have a closer look at the Scottish Chambers of Commerce report that it refers to: “The Scottish Economy in 2010—A Time of Opportunity”. In reading that report, it struck me that Mr Kerr appears to have a blind spot for good news for Scotland. Before it comments on construction, the report mentions

“The emerging positive outlook evident in Scottish business in the second half of 2009”

and the

“cautious optimism in the early months of this year.”

The Scottish Chambers of Commerce indicated some of the things that have been causing problems, such as the severe winter weather and VAT going back up to 17.5 per cent. Neither of those things happened as a result of a Scottish Government policy.

The report makes it clear that one of the biggest cost pressures on Scottish businesses and one of their heaviest burdens is transport costs. Labour’s fuel tax hikes have hit Scottish businesses hard and are becoming a major problem in Scotland. Jobs will be lost in our economy unless those rises are reversed.

Another SCC publication, “Down to Business in 2010”, says:

“The Government must avoid tax increases that could penalise wealth creation or complicate the overall tax system. The planned increases in National Insurance Contributions will make it more expensive to take on new employees at a time of rising unemployment. We urge politicians of all parties to reverse this as soon as possible.”

Mr Kerr’s motion refers to the construction industry. The detail in the section on the construction industry in the report that is mentioned shows that the sector is less pessimistic about the future than it was a year ago, and that 20 per cent of construction companies are recruiting new staff. Andy Kerr claims that nearly 30,000 Scottish construction jobs have gone. The latest Office for National Statistics labour market statistics show that 7,000 construction jobs were lost in Scotland during the final year of the Labour-Lib Dem coalition, which was, I understand, a time of boom. Some 16,000 construction jobs have been lost in the past three years, at a time when Labour’s recession has hit us all hard. Becoming unemployed is hard for anyone, and the struggle to get back into work is an individual challenge that should never be underestimated, but it is clear to me that Scottish Government policies and actions have worked to reduce the number of Scottish construction workers who are losing their jobs, and that the continuing actions of the Government should help them to get back into work. Those efforts have not been helped and nor will they be by Labour talking down Scotland, its economy and construction industry. Not only are Andy Kerr’s figures wrong, his dismissal of Scottish workers is wrong too.

The Scottish Building Federation writes a lot about Scottish construction, which is its business and its blood. It blames the recession for the job losses. The recent SBF press release states clearly:

“But the fact remains that the recession has forced a majority of Scottish building firms to lay people off since the beginning of this year.”

People also fear what will happen in the future.

This is the recession brought into being by Brown and Darling, among others, as outlined by the minister earlier. We have had this Government’s support for capital investment—the extra £350 million for the Scottish Government to spend on new house building. Every effort is being made.

Andy Kerr spoke about the Scottish Futures Trust and he is fond of quoting the chambers of commerce. Ron Hewitt, the chief executive of the Edinburgh Chamber of Commerce said:

“The SFT has now got a good team of experienced people. It (the SFT) is absolutely the right thing to do. It will save public money.”

Andy Kerr’s problem seems to be that he and his colleagues, both here and in Westminster, are unable to recognise that we are trying to make public investment in this country without using that discredited system of public finance initiatives and public-private finance on which they are so hung up.

Will the member give way?

No, thank you.

The payment figure for PFI will approach £1 billion each year by the middle of the next decade and will peak at £1.168 billion in 2024-25. For goodness’ sake, we all know about the scandal that was Hairmyres hospital under the previous Administration—it had a capital value of £68 million compared with a total unitary charge of £725 million, which is more than 10 times as much.

Will the member take an intervention?

No, thank you. I think that we have heard enough from Mr Kerr on PFI.

Equity of just £100 invested in rebuilding Hairmyres hospital is projected to earn £89 million in dividends over 30 years.

That project happened when Gordon Brown was talking about the lack of boom and bust—that is what he wanted. I tell members that he created the boom for himself and a bust for future generations.

It absolutely does not stop. Down south, they are still carrying on with PFI schemes. Even Unison, which supports the Labour Party, has described Labour’s continued support of PFI as “irrational”. PFI shifts the risk of project failure back to the public sector when it goes wrong. We have all seen that; such projects have to be bailed out constantly.

We should work together in Scotland, stop talking it down and start helping this Scottish Government to create better conditions for all in Scotland.

10:08

When I heard that the Labour Party had scheduled a debate on the economy this morning, I thought that we might have had just a hint of contrition from its members or perhaps a scintilla of an apology for the state that our country is in. We heard the extraordinary Labour proposition set out this morning by Andy Kerr that the entire responsibility for the state of our economy must rest with Alex Salmond and the SNP. I do not entirely absolve the SNP of responsibility for some of its actions or the state that we are in, but let us be clear that the ultimate responsibility for our economic mess rests firmly with the Labour Government and Gordon Brown.

The man who was Chancellor of the Exchequer for 10 years from 1997 inherited from Kenneth Clarke a golden economic legacy and proceeded to squander it. In those 10 years as chancellor, Gordon Brown presided over an irresponsible inflationary boom fuelled by easy money, cheap credit and dodgy lending practices, 125 per cent mortgages and people being lent money at five times their salary, soaring house prices and a boom that could not continue. Of course people felt good; they felt the good times and spent money like there was no tomorrow, believing the Government that the economic cycle had been abolished. As Linda Fabiani said, Gordon Brown repeated endlessly that there would be no return to boom and bust. When Gordon Brown promised us that the good times would last for ever, people foolishly believed him and went out and spent money. It was inevitable that that crumbling edifice, built on foundations of clay, would soon come tumbling down and that is exactly what happened. The Labour Party’s approach today is reminiscent of a burglar who breaks into someone’s house, cuts his hand on the kitchen window that he smashed, and then tries to blame the home owner for his injury. That is the state that we are in.

Let us look at where we are after 13 years of Labour. We had the longest and deepest recession on record; we were the last country in the G20 to emerge from recession; we have the second-largest deficit of the Organisation for Economic Co-operation and Development countries, after only Ireland; and we have seen a doubling of the national debt that our children and grandchildren will be paying off for decades to come. That is Gordon Brown’s golden legacy and Andy Kerr and his colleagues should apologise for it this morning.

Far from trying to make things better, what do we see from Labour now? A policy on national insurance that demonstrates that it has learned nothing from its mistakes and will make the situation much worse. It is determined to push ahead with its damaging national insurance rise. We are continually lectured by Gordon Brown and Alistair Darling that the Government should do nothing to harm the recovery and make the situation worse, yet their national insurance rise will do precisely that and suck money out of the economy at just the time when we should be keeping money in people’s pockets. That is why business leaders from across the UK and Scotland have been queueing up to oppose the Labour policy to impose national insurance rises.

If we stop that rise, as the Conservatives propose, seven out of 10 Scots will be better off and none will be worse off. We will save the Scottish public sector £63 million that will otherwise be taken out of health, education and justice. How many teachers, nurses, doctors and policemen will lose their jobs as a result of that proposed rise in national insurance? Labour should think again.

When it comes to ludicrous tax rises, let me move swiftly on to the Liberal Democrats and their proposal to put VAT on homes when the construction industry is already on its knees. Theirs is a policy so mind-boggling in its daftness that it was denounced yesterday by the industry body, Homes for Scotland, as “sheer madness”. So daft is that policy that even Tavish Scott, leader of the Liberal Democrats, did not know that it existed in the Lib Dem manifesto. In what has to rank as the biggest laugh of the election campaign so far, yesterday Tavish Scott was quizzed five times by Glen Campbell of the BBC about whether the policy existed and five times Tavish Scott denied that the Liberal Democrats had any intention to change the rules on VAT.

In the gospels, St Peter denied Christ a mere three times, but St Tavish had to do better than that until, of course, the angel Carmichael flew in to put him right. I have every sympathy for Tavish Scott—I cannot imagine a worse chore than having to read the Liberal Democrat manifesto—but surely it is not too much to expect that the party leader would have got past the pretty pictures and read some of the text of his own manifesto. How can the Liberal Democrats expect voters to take their manifesto seriously when even they do not take it seriously? I offer a word of advice to Mr Scott and his colleagues for future elections: they should read their manifesto before they come to a press conference to launch it and then they might be better placed to answer questions on the details and will not look quite so ridiculous.

In the moments remaining to me, I return to where I started. History seems to be repeating itself. I am old enough to remember 1979, when we had a discredited Labour Government that had run its course, the economy was in crisis, public finances were in a horrendous state and the Government had no ideas about how to get us out of the mess. Thirty-one years on, we are in an identical position. Let us be in no doubt that, when the history of these times is written, responsibility for the state that we are in will rest firmly at the door of one man—James Gordon Brown, Prime Minister of the United Kingdom from June 2007 to May 2010.

10:14

I am pleased to speak in this debate on the construction industry. I declare an interest in that my husband is an electrician. I am as aware as anybody of the problems in the construction industry, both through my mailbag and through personal experience.

It is important that the Government provides the construction industry with a clear indication of the public work that will be available. Without a level of stability and some knowledge of future public works programmes, companies cannot commit to taking on apprentices.

Ninety apprentices in the Highlands and Islands have lost their jobs in the past year. That is a disaster not only for them but for the economy. Not so long ago, we had a shortage of skilled tradespeople and we were unable to cope with the demand for workers. We need to learn that lesson and ensure that we have an adequately skilled workforce that is ready for the recovery.

The funding package for apprentices ended in March. We need a further programme to replace it. We also need new placements for those who have already lost their jobs. In addition, there needs to be a clear picture of expected public procurement. The Scottish Government needs to use every means at its disposal to build schools, hospitals and affordable homes.

I point out that the programme will continue. There will be 15,000 new apprenticeships this year—we had 20,000 last year. Will the member confirm what Andy Kerr said earlier: that the Labour Party now supports a guarantee to apprenticeships—a right to apprenticeships? That is a departure from what employers want and from the way that things have been done in Scotland for a long time and it is not sustainable.

What we need is a guarantee to young people who want to take up an apprenticeship that they can get one. It is important that that form of training remains in place and I am grateful to the minister for intervening to confirm that the programme will continue. I am sure that many construction companies will be delighted by that news.

I have been pushing the Government for some time about housing association grant. Cutting the grant when housing associations have difficulty borrowing stops them building. That affects the availability of affordable homes and jobs.

I have been critical of the assumed rent that is imposed by the Government when housing associations need to apply for additional housing association grant. Additional grant is often required for small projects in remote and rural areas where there are no economies of scale. In order to access the additional grant, housing associations have to use the assumed rent in their calculations. The assumed rent does not take account of what people in the area can afford; many people in rural areas are on lower incomes and cannot afford the assumed rent. Forcing housing associations to use a rental income figure that is not realistic in the local economy means that the housing projects do not stack up financially. There is a funding gap for those projects, because housing associations can borrow only against actual rent. If a different figure is used to calculate housing association grant, the figures simply do not stack up.

The Government has made funding available to councils to provide them with grant of up to £25,000 for each house that they build, but only certain councils are able to access that additional council house funding. They have to bid for the funding and councils with large housing debt are not eligible to receive it. In Highland Council, the SNP campaigned against stock transfer, under which the council’s housing debt would have been written off. The SNP Government is now penalising councils that have not had their debt written off. It needs to change that policy and provide for councils that cannot afford to build.

In addition to large cuts in the housing budget this year, the profile of funding and the cost stipulations put forward mean that it is impossible to build projects that do not enjoy economies of scale. They also make it difficult for new homes to be environmentally sustainable and to incorporate renewables, so those houses will not assist the Government in reaching its carbon emissions targets. It also means that the Government’s policy has all but halted building in rural areas, some of which are still pressured. Local people earning local wages are unable to buy.

The Scottish Futures Trust is yet to build anything. It appears that the only decision that the trust has taken is to create further bureaucracy in public procurement while doing nothing to maximise finance for public projects. It has devised procurement hubs throughout Scotland and has sought bids for them from partners. Only one construction company can be the main partner. Although the company can subcontract, the current climate is such that that in effect shuts out other construction companies from public contracts for at least 10 years. Only large companies can become part of that, because the pre-qualification process is time consuming and very expensive. At a time when the Government is refusing to use public-private partnerships to lever in private finance, that will spell disaster for many companies that are already facing difficulties because of the downturn in the housing market. It also means that smaller companies that are involved in smaller projects will be unable to take part. That is especially true in rural areas. Although there is an opt-out for projects under £75,000, it is unlikely that that will happen if the hub procurement route is used for all public projects.

The Government’s focus is bureaucracy and centralisation at a time when our companies need flexibility and opportunity. The Government could helpfully provide guidance on best practice, such as on EU public procurement for councils, which would create efficiency and cut bureaucracy, but it is doing the opposite.

Our construction industry is fundamental to the Scottish economy. Our young people are now losing out on training that will benefit them and our economy in the future. The economic downturn means that people need affordable homes and jobs. It is time for the Government to act.

10:20

If we are going to get out of this recession, we must have economic growth. That is understood in Scotland, Britain and across the world. The debate that we are having just now is about how we achieve that.

We have seen the discredited method of spend now, pay later. We are trying to find better ways to deliver the public goods that people are looking for and, at the same time, to bolster employment and training.

I suggest that we start with reality. Given that no one from the Labour front bench is left in the chamber, they can read the point that I am about to make later. [Interruption.] David Whitton does not count. An article in The Herald from 12 April states:

“Scottish manufacturing staged a strong recovery last month but could not prevent a fall in the rate of growth in the private sector economy, according to the latest Bank of Scotland PMI survey published today ... Production levels at manufacturing plants rose at the fastest pace in the 12-year history of the survey ... Positive momentum came from existing customers placing new business while the continuing poor weather acted as a brake on better performance.”

That is an indicator that, in hard times, progress is being made in the Scottish economy.

On the same day, it was reported that in 2008-09—in the heart of the recession—there was an 8.3 per cent increase in sales by the Scotland-based oil and gas supply chain industry around the world. Many highly skilled jobs are tied up in those businesses, which are successful and are expanding. We are finding plenty of examples throughout the economy to show that, where business is expanding, apprentices will be taken on.

There is the stopgap of Government schemes that support apprenticeships, such as safeguard an apprentice, invest in an apprentice and adopt an apprentice, many of which have bolstered the economy and the firms that are struggling to come out of recession, but the real recovery will come when private business expands and takes on the trainees.

I am sure that Mr Gibson will recognise that private firms can expand only if there are contracts to expand to. The mere fact that the Scottish Futures Trust has not laid one single contract is probably the reason why companies are still trying to find jobs for apprentices.

Given that Mr Whitton mentioned the Scottish Futures Trust, it is important to scotch the myth that it is doing nothing. School programmes and hub partnerships are being supported. There are tax increment finance schemes, the Aberdeen non-profit-distributing refinancing plan and the Borders rail NPD scheme. The Forth replacement crossing is getting advice. There is work in NHS Tayside. I could go on. The point is that the SFT is putting money into the development of schemes. A small example in my area is the Tain replacement health centre. The Scottish Futures Trust injected £1.02 million to kick-start that £7 million project. There are many more such examples. If members ignore what is on paper and what is there to see, we will not be able to have a debate about the reality of Scotland and will just repeat the rhetoric of the past.

How will we get things moving? We have to change from having an economy that is based on banks that have been bolstering property prices and supporting share prices. Lending from the banks has dried up or has become so much more expensive that it has been necessary for the Scottish Government to follow what has been suggested by others, including Gordon Brown, who said that he would set up a green energy bank—if there is any chance of his being returned to deliver it. At least the Scottish Government is launching its own investment bank. By putting its money where its mouth is, the SNP Government is showing its faith in the ability of Scottish businesses to contribute to the Scottish recovery and growth and setting an example to the banks and financial institutions that they must do the same.

 

The banks that are based in Scotland have been categorised as part of the problem, but the activities in Scotland were not the problem. It is the investment banking operations in London and New York—the spivs and speculators—who were the problem, and they were allowed to do what they did because Labour’s oversight of banking failed and because, as the minister said, oversight also failed in the USA.

The previous speaker from Labour went on about housing associations, but she ignores the large increase in affordable housing through councils, which was cut off in the Thatcher years and under Labour. We are seeing that increase taking place now.

Will the member give way?

I am sorry, but I do not have time. I will talk to the member about the matter later.

What is so funny about the Labour argument is the fact that it was appalled by the use of the accelerated spend to buy land. We cannot build on thin air. Much of Labour’s argument is about building on thin air. Its PPP schemes, under which we buy now and pay later, have landed Scotland with a huge burden that will have to be paid and which will hold back the development of our economy in the future.

I ask members to support the Government’s amendment, which contains the commonsense approach.

10:26

The previous speaker pointed out the important role that the banks have to play. He was making excellent progress until he spoiled it by suggesting that the only people who invented bad practices in banks were those who resided in London and America. Sadly, we have to acknowledge that an important role in the management of some of the banks was played by some at-one-time prominent Scots. The collective responsibility for the mismanagement of the banks spreads across our banking sector. I accept that the changes to banking regulation in 2000-01 did not contribute greatly to progress, but Rob Gibson was nevertheless wrong to make the point that he did.

We are seeking ways in which to ensure that the private sector is ultimately able to make a recovery but, as has been the case in every other economic cycle that we have observed, there is no immediate sign that a spontaneous recovery is being generated by the private sector, so the public sector plays an important role in the process. I agree that the process needs to be carefully balanced because we are consuming public money in trying to reach the point of recovery.

The difficulty that we have, I suppose, is the models that we are using here in Scotland. It is not helpful to characterise the debate as being entirely polarised. I am bound to say to the minister that the Scottish Futures Trust has taken up an inordinately long time in repeatedly remodelling itself. If, as we have been told, it now has good management, is staffed by good people, and is starting to make some progress, that is good. I do not object to that, but to claim that it has been a wonderful success to date is to overstate the position and also to overlook the other models that exist.

For example, the reduction in the construction industry in the west of Scotland has undoubtedly had a devastating effect, but I note with interest that the urban regeneration companies that were created by the Government of which I was a part have still been placing contracts and are still able to produce the public and private sector model that was started within those projects. There are such models in Scotland. We do not necessarily have to create new and different structures.

That brings me back to the important role that the housing sector plays in our economy, particularly in the construction industry. Derek Brownlee mentioned some of the factors that cause house price inflation, but another is the fact that some 70,000 dwelling-houses are out of use, which contributes to the question of supply and demand. Why are they out of use? That is the question. I am sure that Murdo Fraser will get much more entertainment and amusement from his characterisation of St Alistair Carmichael, but the VAT proposal is a serious one.

If we are looking at the economy as a whole and at housing provision as a whole, we must recognise that 70,000 houses in Scotland are out of use. I do not have the UK figure. Organisations such as the Royal Institute of British Architects, the Royal Institution of Chartered Surveyors and the Federation of Master Builders have been campaigning for quite some time for an equalisation of the VAT rate for new build and repairs and refurbishments, and we can understand why. It will be extremely difficult to stimulate a recovery through the regeneration of older properties unless we make a serious attempt to reduce the high level of VAT in the sector.

We might disagree about whether the proposal represents the right route, but we cannot say that it is not a serious suggestion. It has not just been invented by the Liberal Democrat party. It has strong support from professional people who work in the sector. It is a serious proposal to deal with the need to bring properties back into use, and we should also consider the multiplier effects on the regeneration side, which are higher than those on the new-build side.

There is also the question of meeting our energy targets, which Sarah Boyack discussed in her speech. We need to bring the 70,000 houses back into use to benefit the economy and the housing sector, but we must also refurbish them in such a way that they make a significant contribution to our energy targets. Given that the current rate of replacement of our building stock is about 0.5 per cent, the repair and upgrading of existing building stock is the primary weapon to be used in protecting the environment against the ravages of climate change.

The suggestions are serious ones that look not just at the immediate problem of trying to stimulate the housing market but at the mix of that market and particularly at how we sustain jobs in the housing sector. The measures are sustainable and supportable but, more particularly, they make a major contribution to employment and economic growth.

10:33

In 1977, I began an apprenticeship as a welder. Like many of my friends, neighbours and peers in the steel and coal communities of Lanarkshire, I appreciated the importance of training and skills and the opportunities that they provide. By the time I became a time-served craftsman in the early 1980s, I had begun to witness the decimation of both the steel and coal industries and the trades that were associated with manufacturing and construction.

It was to fight against the damage that was being done to our traditional industries at that time that I became active in the Labour and trade union movement. That is why I place such great store in the Government’s role in invigorating the construction and manufacturing sectors and investing in skills and training programmes to give young people the same opportunities that I had when I entered the workplace.

Given the importance of manufacturing, does the member consider that it is a shame that more than 140,000 manufacturing jobs were lost in Scotland between June 1997 and November last year?

It is always regrettable when jobs are lost. It is when we look at why the problems exist and what is being put in place to address them that we start to see the wider picture. Not addressing the problem is the biggest issue as far as we are concerned. We can identify all the problems we want. The important thing is whether we have the attitude and the endeavour to address the problems that are encountered.

That is why I am angered by the Scottish Government’s failure to provide the capital infrastructure projects that would have built on the legacy that we bequeathed to it and enabled us to fight against the impact of the global recession. That failure is the reason why we need to have this morning’s debate.

The Scottish Government’s failure is the reason why 150 apprentices in Lanarkshire have lost their jobs in the past year. They include young potential tradesmen such as Nicos Lambrou from Uddingston in my constituency, who was made redundant with a redundancy package of less than a week’s wages as he approached the end of his third year as an apprentice joiner with a large well-known building company. He was allowed to finish his advanced craft and design course at college, as it was already paid for, but, one year on, he is still unemployed and is in the predicament of being neither a fully qualified joiner nor an apprentice whom companies would be able to employ.

The commitment to continuing support for apprenticeships and all the other schemes is greatly welcome, but the reduction in the maximum age for support to 19 means that that young man is in no position to take advantage of any support networks that are available to allow him to complete his apprenticeship. As time ebbs away, he is losing touch with a career for which he spent a significant amount of time training. What a waste—and what an indictment of ministers, who should be straining every sinew to provide every young person with the right to high-quality training and to finish the training that they started.

We have heard how important the construction sector is, and no more so than in Hamilton North and Bellshill, which is home to more construction workers than other constituency in Scotland. Traditionally, Lanarkshire has also been the focus of the Scottish steel industry. The demolition of the Ravenscraig steelworks has bequeathed the area the largest brownfield site in Europe. It is vital that redevelopment of the site progresses, to provide the thousands of new employment opportunities that have long been promised there, but the Administration has been found wanting yet again. It has reduced the project from a national to a regional priority and has deprived it of millions of pounds of Government investment as a result.

Only the Dalzell plate mill and the heat treatment section at Clydebridge remain of Motherwell’s once thriving iron and steel industry, but the Scottish steel industry retains a highly skilled workforce. The industry has been in a slump of late, as have many other industries—manufacturing has been badly hit—but the industry’s work is cyclical. It is vital to retain the workforce’s skills to take advantage of the upturn when it comes. The Scottish Government can help to create stable and growing demand for skills by preparing a route map of national infrastructure investment, but the Scottish Futures Trust is not achieving that. Whatever else it might be doing, it is not delivering projects that will put people into jobs.

Manufacturing is the cornerstone of any successful and balanced economy. The events of recent months should have shown us that we can no longer rely on the financial sector to prop up the entire Scottish economy. It is essential to retain our traditional industrial base. As the Association for Consultancy and Engineering says, the Scottish Government needs to take an integrated approach to making the business environment conducive to construction and manufacturing.

We need to encourage private sector investment in construction projects. We need clarity about and consistency of funding, rather than the misbegotten Scottish Futures Trust, which whiles away the hours while schools go unbuilt and road projects go unstarted. Given that construction projects can deliver about £2.50 in return for every £1 that is invested, a continued slow-down in capital projects will increase costs and diminish returns for Scottish taxpayers and have a detrimental impact on Scotland’s construction industry.

Scotland needs a dynamic Government, not a dogmatic one that strangles the industries on which we depend when it should draw on all the capacity that is at our disposal to breathe life into our economy. It is not good enough to have warm words; we need action. What we have seen from the Scottish Government has resulted in people such as my constituent being left behind, being disappointed and having no prospect of progressing the career to which they were entitled. I benefited from Government support when it was necessary. It is time that the current Government stepped up to help people like me.

10:39

First, I join Murdo Fraser in expressing amazement that Labour has chosen to debate the economy at this stage in the UK election campaign, as it is Labour’s gross mishandling of the economy that has contributed to many of the problems that face us, including the dearth of capital infrastructure projects, which affects jobs in general and apprenticeships in particular.

Projects in the construction industry depend on investment being available not only from the public sector but from private sources. We have only to look at the huge number of private house building projects that have been put on hold because of the current financial situation to see that. I have no doubt that part of the problem has been the worldwide economic recession, but it is no use Labour hiding behind that smokescreen. All countries throughout the world have faced the recession so, if that is the only reason for financial distress, all should be in the same boat, yet Britain is worse off than almost every other first-world country. The evidence for that can be seen not only in the pound’s falling level as measured against other currencies but in more objective measurements by impartial outside analysts.

For example, we need to sell a massive number of Government bonds to countries such as China to stay afloat financially. Institutions that raise money are assessed according to the cost of insuring against default. According to a report by the respected international financial analyst company Bloomberg a few weeks ago, by that measure Gordon Brown’s Government is not only less creditworthy than countries such as Portugal and Slovenia but even far less creditworthy than private sector companies such as Vodafone, Gap, BP and McDonald’s. Yes—we have now reached the humiliating situation in which a Big Mac is a far safer bet than Her Britannic Majesty’s Government to the outside world. We could say Big Mac 1, Hash Brown nil—what a verdict on 13 years of Labour rule.

By the way, do members remember the then chancellor’s multiple boasts that he had ended for ever the cycle of boom and bust? He said that most recently in his budget statement on 21 March 2007. How his speeches have changed. He artificially bolstered his reputation for creating prosperity by plundering our gold reserves and losing £5 billion in the process, by squandering our oil and by helping himself to well over £100 billion in stealth taxes on private pension schemes, which now have less to invest in the construction industry as a consequence—and Labour moans about the economy. No wonder so few countries are buying our bonds that the UK Government must buy them, which is building up inflationary times ahead that will rock the economy, including the construction industry, still further. Those are the reasons—rather than any lack of action by the Scottish Government—why many construction jobs have been lost.

The Labour motion purports to regret

“the Scottish Government’s failure to ensure a steady stream of capital infrastructure”

projects but ignores the fact that the Scottish construction industry is outperforming the industry in most of the Labour-controlled UK and would be doing even better if Alistair Darling had taken our advice—and that of Iain Gray—to accelerate capital investment this year by £350 million. How hypocritical is that?

If we are speaking about hypocrisy and construction jobs, how does Ian McKee justify cancelling the Glasgow airport rail link and its 1,300 jobs?

The Glasgow airport rail link had so many flaws that it would take the rest of my speech to explain them all. The project was a poor investment. Creating jobs just for the sake of doing so, when the investment is not good, is not a good idea.

I ask members to consider the SNP Government’s house building record in my constituency, the Lothians. Thanks to Government support, more than 900 affordable homes were built in Edinburgh in 2009, which is the highest figure for any year since devolution. In Midlothian, 555 affordable homes have been started since the SNP took office in 2007. That compares with the pathetic 240 affordable homes that were built in Labour’s entire time in office since devolution. In two and a half years, the SNP has provided more than double that amount. The same pattern is being repeated throughout Scotland, which is keeping many construction firms in business. The myth that Labour is the party of social housing in Scotland has been well and truly exposed.

Moreover, more would be available to spend on affordable housing and other projects if it were not for Labour’s disastrous love affair with PFI/PPP, as my colleague Linda Fabiani said. That love affair has saddled Scottish public bodies with payment obligations of £820 million in 2010-11 and the obligations will be fully paid off only by 2041-42. It is as if Labour incurred a huge credit card bill but has committed to paying back only the minimum amount each month, which is the most expensive way of organising finances that we could think of—it is a way of organising finances that I would classify as transgenerational robbery, as it is our children who will have to pay for the money that we are spending now.

 

I was going to say a few words about the Government’s record on apprentices, but time is running out because of my response to Mr Whitton’s intervention.

Wind up, please.

I will just add that we are up for it, and I ask members to vote against the Labour motion.

10:45

As we all know, we often need both a brass neck and a thick skin in politics. Those features were well exhibited by Andy Kerr and the Labour Party today in securing a debate on the economy. Some might call it brave, and others would call it foolhardy, but we ought to be grateful to the Labour Party for giving us this opportunity to scrutinise its record in government over the past 13 wasted years.

Labour just loves to gloss over the role of its Prime Minister and former Chancellor of the Exchequer in the mismanagement of our economy, which has brought our country and our public finances to their present sorry state. Labour members want to blame the bankers and international capitalism as the root of all the problems. Given that the irresponsible behaviour of certain banks has created problems on a global scale, it is on a global comparison against which the record of our Government should be judged.

In that global comparison, the record of the present Labour Government simply does not stand up to scrutiny. As Murdo Fraser and others have pointed out, among all the G20 countries, we have been the last to emerge from the recession. Trying to pin the blame on the SNP Government’s management of a budget of a mere £33 billion, which is only one fifth of the total annual deficit that is being run up on the nation’s credit card year after year by the Labour Government, is a ludicrous proposition.

Against that backcloth, and given the massive deficit in the public finances of Grecian proportions that the next Government will have to tackle, I am firmly of the view that the focus must be on keeping people in work, and our policy responses in Scotland must be tailored accordingly to help get us out of the recession and on the path to recovery.

In that context, the Labour Government’s tax on jobs through national insurance increases is quite simply wrong. It has been rightly condemned by every single business organisation in the country, and by hundreds of businesses, large and small. It will raise the cost of employing people, and it will make more employees vulnerable to redundancy and short-term working.

The impact of that increase will not just be felt in the private sector, as the public sector is a major employer in Scotland—including the national health service, councils and other Government bodies and agencies. Together, they employ approximately 25 per cent of the working population. Labour’s national insurance increases will cost the public sector £63 million a year, or £20 million for the NHS and £33 million for councils. With that money, our councils could employ more than 1,200 teachers and reverse the decline in the number of teachers that has taken place over the past two years. With that money, the NHS could make life-saving drugs for the treatment of cancer much more widely available than is the case at present. The tax rises are not painless—they come at a cost, in both jobs and services.

Having expressed my gratitude to the Labour Party for giving us an opportunity to criticise its record, I must convey a special thanks to it for highlighting the construction industry in its motion.

Aha!

That is the construction industry that, I remind Mr Rob Gibson, built more council houses every year under Mrs Thatcher than has subsequently been achieved under Labour or the Liberal Democrats—or than even the SNP aspired to build, a point that Mr Alex Neil has been generous enough to acknowledge.

More important, and particularly in the current context, it is the construction industry that has lost more than 30,000 jobs over the past two years. That is the sector that was identified as being in need of particular support when we accelerated the affordable housing investment programme in the last two Scottish budgets in order to build new affordable homes on behalf of housing associations.

Construction is the sector that, all of us were supposed to agree, needed special attention and support, but we will have to think again because, lo and behold, the Liberal Democrats want to impose VAT on the sale of new homes. Until yesterday, not many people had heard about that Liberal Democrat policy. Indeed, even Tavish Scott had not heard of it—he denied its very existence five times during a radio interview. It is a fact—it is a policy in the Liberal Democrat manifesto and in no one else’s. It has been described by Jonathan Fair, the chief executive of Homes for Scotland, as “sheer madness”.

Who signed off that policy? It must have been the Liberal Democrat shadow chancellor, the saintly Vincent Cable, the sanctimonious Brahan seer of the recession, who loves to tell us how only he had the foresight, and only he has the wisdom to identify and deal with the financial crisis. The Brahan seer certainly took his eye off the ball as far as that policy is concerned, did he not? It is indeed “sheer madness”. In one fell swoop, the not so capable Cable has gone from financial guru to nutty professor.

Will the member give way?

Will the member take an intervention?

I am in the last minute of my speech.

We are indeed indebted to the Labour Party for pointing out the key features of the emerging Labour-Liberal Democrat coalition that its members are just gagging to stitch together again, if they get the chance. The Labour Party would give people a tax on new jobs; the Liberal Democrats would give people a tax on new homes. That way lies not the road to recovery—those are policies that will deepen the recession.

I support the amendment in the name of my colleague Derek Brownlee.

10:51

All of us in the chamber can agree on the need to act urgently to implement effective solutions to support our local and national economies. As convener of the cross-party group on construction, I take this opportunity to highlight the difficulties that continue to be experienced by the construction industry and to outline what the sector needs from this Scottish Government—not from someone else, but from the minister’s Government. Given the significance of the construction industry in Scotland, it is vital that it takes an appropriate place on the political agenda.

The construction industry is crucial to the Scottish economy. It employs more than 200,000 people, which is 8 per cent of the working population. It contributes approximately £10 billion to Scotland’s economy every year, which is equivalent to 10 per cent of total economic output.

The economic downturn has had a very significant impact on the industry. Employment in the industry fell by 4 per cent in the first eight months of 2009, which is equal to the loss of 8,500 jobs. It is expected that, by 2013, the industry will have recovered only as far as the levels of output that were achieved in 1999. It is crucial that the Scottish Government listens to the needs of the sector if it is to return to full strength.

The Government must work with the construction industry and with bodies such as the Scottish Further and Higher Education Funding Council to ensure that college and university courses are adequately funded and that the industry is equipped with the skills to deliver construction projects. The recent proposals by the Scottish funding council to cut funding in universities for architecture, the built environment and planning by 22 per cent would severely impact on the construction industry and on the ambitions of the Scottish Government. All Government departments and agencies need to work together—it seems that the right hand has no clue what the left hand is doing.

I thank the member for taking this intervention, and I acknowledge her work in the cross-party group on construction. Will she acknowledge that, when she talks with representatives on that group, they tell her that their main problem lies in adequate finance for people to buy houses in the first place?

If Labour is proposing a guaranteed right to an apprenticeship for young people, how does the member propose that Labour will fulfil that guarantee in the absence of employers taking on those apprenticeships?

I am trying to point out, first, that all Government departments need to work together. Secondly, the Government must get its Scottish Futures Trust act together, so that public sector contracts and building projects can proceed. If there was work in the sector, there would be places for apprentices.

The Scottish Government’s targets on climate change could be seriously impeded by a reduction in the number of built environment graduates, who would be expected to lead in such areas as developing building standards and sustainable energy. The Scottish Government’s targets on housing could also be impacted upon, through a reduction in the number of skilled professionals who are available. Issues have been raised throughout Scotland about there being too few planning graduates.

The Scottish Government’s strategy of

“investing in major infrastructure projects to support the growth of our key sectors”

cannot be delivered without an adequate supply of built environment graduates, quantity surveyors and others.

Although the proposals have been shelved because of intense lobbying by the sector, the Government must work with the Scottish funding council to ensure that they are rejected, as such cuts could have dramatic implications for the future of the industry.

The Civil Engineering Contractors Association estimates that the Scottish civil engineering sector has downsized 15 per cent to 20 per cent in the past year, with many firms now working minimum hours in an effort to avoid further redundancies and the loss of skills. The sector relies on Scottish public sector clients for more than 75 per cent of its workload and, to protect the core skills base, it is essential that the Scottish Government prioritise its investment programme for major capital building projects. That answers the minister’s intervention.

The Scottish Futures Trust must act now to mobilise additional funding for new schools, hospitals, public sector housing and infrastructure from the private sector. I urge the Scottish Government to evaluate the overall package of funding for Scotland’s construction industry to make public sector investment efficient and effective. It is crucial that public sector procurement contracts within the sector be linked to skills and training. The Government must create drivers to stimulate the sector and link contracts to construction jobs, such as the Dysart townscape heritage initiative in my constituency, which has allowed stonemason apprentices to train in an area where there will be long-term training and a need for their skills. Transport Scotland also aims to include apprenticeship clauses in the construction of the Forth replacement crossing. Such initiatives must be welcomed and supported by the Government and must be how we draw up contracts in future.

Part of the cross-party group’s remit is to emphasise the need for focused education and training places. As I said, I am deeply concerned that 63 apprentices in the construction and engineering industries in Fife have lost their jobs in the past year. Since the start of the recession, 1,450 apprentices have been made redundant and, although 40 per cent of those young people have been re-employed, 833 still require a work placement. The Government has withdrawn support for apprentices through ScotAction and a high number of apprentices still seek work. The adopt an apprentice initiative continues until May 2010, but it is anticipated that a high number of young people will still require support after that date.

What is the Government going to do for those young people? The construction industry is asking that, not me. More proactive support is needed to prevent further apprentice redundancies and to create new opportunities for modern apprenticeships.

You should finish now, Ms Livingstone.

Okay.

The latest figures from the construction industry claim that 7,220 new recruits are needed annually. The minister and the Government must recognise the significant contribution that the construction industry makes to the Scottish economy by supporting jobs and the skills in the industry and by giving it the support that it needs now if it is to continue to be the driver for economic recovery.

10:58

The debate this morning has gone according to party lines, as we would expect. As there is the small matter of a UK election, it is no surprise that the Parliament is being used as a platform for all parties to promote their wares, and I am afraid that I will be no different from other members in that.

We have already heard from some members the allegation of a lack of public contracts and, not surprisingly, that has been rebutted by my SNP colleagues. It a ridiculous position for Labour members to take in their motion bearing in mind the fact that even more public sector contracts could have been started and more jobs safeguarded and created if the Labour chancellor had agreed to accelerate £350 million of capital funding. Unfortunately, he did not see the sense in that.

Will the member give way on that point?

I have just started, so I need to make some progress at the moment.

We have already heard about the consequentials that came to the Scottish Parliament. Only two weeks ago, John Swinney announced how that money is to be spent. Sarah Boyack touched on the boiler scrappage scheme in her speech. That scheme was £2 million and it would have been wonderful if it had been more but, if Sarah Boyack wants more money for the scheme, we would have to consider, and she would have to answer, the question: from which consequentials would it come? Would it be from the £31 million of additional money that is going into housing?

As I said in my speech, I would take it from the woeful underspend in the energy efficiency programme this year. The money that the Scottish Government put in is the consequentials. The UK Government and the Welsh Assembly Government put in more; that is what the SNP should have done.

I admit that I would rather trust John Swinney to handle our economy than Alistair Darling, to whom I will come in a wee moment.

Under the current and previous chancellors’ never-never economic policies, if the money was not there, they would just go and borrow it. Before anyone shouts about the money that went into assisting the banks, I point out that the full UK national debt cannot be attributed to the loans given to the banks. No amount of spin or bluster can deny that. The bottom line is that every person in Scotland and the UK is up to their eyeballs in debt. It is not so much personal debt—although some people are, of course—but the debt built up by two chancellors who threw money around like confetti with little regard for the return on investment.

Will the member give way?

I will make some more progress on this point.

They also threw virtually £32 billion of PPP money around, which we in Scotland will be paying back for decades. My kids are eight months old and coming up for three. By the time that they leave school, they will have the privilege of paying taxes for the schools that they went to, which will still have to be paid off.

The Tories, given their record, have nothing to crow about in Scotland or elsewhere in the UK. I grew up in Port Glasgow and remember the 1970s, when being outside a shipyard when the hooter went was frightening, as thousands of men and women poured out. That was obviously not the heyday for shipbuilding but, nonetheless, thousands of men and women worked in the yards in Inverclyde as well as in engineering firms such as Kincaid’s. When Thatcher came to power, she hammered the final nail in the coffin for the shipyards in Inverclyde.

Will the member give way?

I will make some progress on this point.

Thatcher’s policies resulted in a generation of people being lost to apprenticeships and training. I am afraid that the youth training scheme was nothing short of a cheap labour scheme. It paid people up to about £27 per week and did not train them fully. It was an affront to the youth of Scotland and elsewhere in the UK, and the Tories should be eternally shamed for it.

Will Stuart McMillan join me in condemning the SNP MPs who, in 1979, walked through the lobbies and ushered in the worst decade of Thatcherism that the country has ever seen?

I am glad that the member asked that question because, let us face it, the economy in the late 1970s was an absolute shambles created by the Labour Government and Labour members should be ashamed of themselves.

To go back to the Tories, Norman Tebbit called on people to get on their bikes, but that was not an option for some people, and others wanted to stay in a place they called home to try to rebuild their lives and communities. The latter point is something that Tories of that era probably did not understand and, thankfully, the electorate of Scotland continued to give them a bloody nose and ultimately humiliated them by electing none of them in 1997.

The Liberal Democrats do not have much of a record to defend from London but, only yesterday, Homes for Scotland slammed their proposals to add VAT to new-build homes. Just in case the Lib Dems do not know, there has been a recession and the housing market is extremely fragile. However, they want to add to the already challenging house-building market. The electorate will see the madness of that proposal.

Will the member give way?

I am in my last minute, so I really have to finish off.

With regard to the motion, it is absolute nonsense to say that the Scottish Futures Trust is not doing anything. My colleague Rob Gibson already mentioned a range of projects in which the SFT is involved. Ron Hewitt, the chief executive of the Edinburgh Chamber of Commerce, has said that the SFT

“is absolutely the right thing to do. It will save public money.”

I would rather take Mr Hewitt’s advice than the Hoddit and Doddit economic strategies of Gray and Kerr and the bankrupt partnership of Brown and Darling.

We have had enough of Gray’s guff, Tavish’s tosh and Annabel’s amnesia. Some members will say that Scotland is too poor, too wee and too stupid to be independent.

Finish now, Mr McMillan, please.

I say that Scotland simply cannot afford to remain as part of this bankrupt Britain and that our economy needs to continue to move forward with more economic powers.

11:04

I like to think of myself as pretty unshockable when it comes to hubris from the British Labour Party benches, but the sheer brass neck of Mr Kerr’s motion takes Labour to heady new heights. The motion calls on the Parliament to regret

“the Scottish Government’s failure to ensure a steady stream of capital infrastructure works”.

The Scottish Government demonstrated its commitment to accelerating capital expenditure last year, when investment helped the construction industry to cope with the recession. It is sad that Alistair Darling’s record is not quite so illustrious.

Will the member take an intervention?

If he gives me a moment to make my points, I will let the member in.

Despite repeated requests to allow the Scottish Government to accelerate capital spending, the British Labour Party sold Scotland’s construction industry down the river. What a cheek Scottish Labour members have to bring this debate to the Parliament, when their colleagues down south prevented more capital investment. What a nerve! The idea that the Scottish Government could do more under the current devolution settlement is absurd. However, if Mr Kerr has seen the light, in a road to Damascus conversion on the road back from Hairmyres, and is suggesting that the Scottish Government should be accountable for all revenue and expenditure in Scotland, I welcome his conversion to the cause of independence and I will have a membership form sent to his office—in fact, I will take it over myself.

I look forward to getting the member’s letter in the post. Will she comment on the substantive point that all our construction lobbies, organisations and trade unions have made, which is that the programme that the Scottish Government inherited was £1.3 billion but collapsed to £300 million, leaving a £1 billion deficit in the construction industry in Scotland, which has led to the loss of 27,200 jobs by her Government?

Andy Kerr should listen to Drysdale Graham, from the law firm McGrigors, who said:

“the SFT is a force for good.”

Mr Kerr should feel the force and embrace it.

The British Labour Party’s dilemma in Scotland is that its Westminster bosses are telling the world that the recession was not their fault but was a global recession—and yes, there was a global recession—so the recession in Britain had nothing to do with them. In the meantime, in the Scottish Parliament, the same party is obsessed with playing party politics with the recession in Scotland. Labour would have us believe that there was a completely global recession and a completely Scottish one.

In the closing speeches, I invite Labour to apologise for their continual smears against countries such as Ireland and Iceland, particularly now that the most recent IMF estimates—Labour members will be disappointed to hear this—show that Ireland, Iceland and Norway will remain wealthier per head than the UK between now and 2014.

I give credit where credit is due. Iain Gray supported the Scottish Government’s call to accelerate capital spending this year, which would have secured thousands of jobs in Scotland throughout the recovery period. It is unfortunate that the rug was again pulled out from under the Labour Party in Scotland by none other than Mr Darling—one of its own and supposedly one of our own, given that he is a Scottish Labour MP—who refused to help Scotland and threw a rare opportunity for consensus to the winds. It is no wonder that Scottish Labour members’ frustration at being caught like rabbits in the devolution settlement’s headlights is palpable in the lodging of motions such as the one that we are debating.

The motion refers to the Scottish Chambers of Commerce’s business survey. Let us consider the key issues that the survey identified. The Scottish Chambers of Commerce said:

“Once again there are more signs that cost pressures are increasing, especially transport”.

That will not surprise anyone who has been to the petrol pumps recently. Does the Labour Party not realise that every construction business in Scotland feels the knock-on effect of increased transport costs, as do wholesalers and the hauliers who have not yet been driven out of business?

Will the member give way?

Not unless Duncan McNeil is standing up to condemn the rising fuel costs. Labour members will not condemn the increases, because they have been presided over by the British Labour Party, of which they are all fully paid-up members. Despite the good work of my colleague Angus MacNeil MP on the issue, the London-based Labour Party has refused to help companies and communities to deal with rising fuel costs. Companies are being driven out of business on Labour’s watch.

Will the member give way?

No. If I thought that the member was going to say something constructive rather than indulge in party politicking, I would do, but I do not think that, so I will not give way—[Interruption.] Labour members should remember that I am responding to their pathetic motion.

The decline in the demand for house building is hugely significant to the construction industry, but—funnily enough—Mr Kerr makes no mention of that in the motion. I will give members a clue as to why that is. The Scottish Government is making substantial progress on house building. Indeed, the recent announcement of £31 million for affordable housing will be welcome in the construction sector. If the matter was left to Labour, there would not be enough new council houses to house their soon-to-be-unemployed ex-MPs, let alone anyone else.

The SNP Government is doing the best that it can do to support the Scottish economy and steer it back to growth, given the limited powers that it has. The restrictions on our power, which prevent us from fully addressing economic growth, are of course supported by all the unionist parties in the Scottish Parliament. The SNP Government is doing its best, given the restrictions that are imposed on it by the British parties. If members of this Parliament want to grow our economy and provide training to “every young person”, as the motion says, they must acknowledge that although we are doing pretty well with one hand tied behind our backs, we would do a whole lot better if we had the full economic powers of an independent nation.

11:11

Many members have referred to the fact that the economy in Scotland is performing worse than the economy of the rest of the UK. We have agreed with and supported some of the work of the Scottish Government during the past year and, when we engaged with the Government during the budget process, it was inevitable that we focused on elements of the economy. We argued that it was unsustainable for the pay bill for the highest-paid employees in the public sector to continue unchecked and that tackling the issue would free up resources to provide more college places for young people. The Scottish Government responded—largely, if not entirely—positively to our arguments. I think that the people of Scotland expect the budget process to operate in that way.

However, we have been concerned by some perverse decisions by the Scottish Government during the worst recession in living memory, which is deep and will have a longstanding impact. One such decision was the decision to reduce the enterprise budget. Moreover, the Government has not been clear about its priorities within its fixed budget. For example, the first version of the Government’s economic recovery plan said that free school meals were a crucial part of economic recovery, but the policy has been dropped from subsequent versions. We are right to highlight the perverse choices that the Government has made, despite its claim that its number 1 overarching aim is economic development in Scotland.

Will the member give way?

Will the member give way?

If Mr Gavin Brown does not mind, I will give way to the Minister for Skills and Lifelong Learning.

I thank Mr Purvis. Does he think that it is right for someone who proposes the application of VAT to new house building to accuse anyone else of making “perverse decisions”?

I will respond to the minister’s point. Given the Government’s housing policy as set out in “Firm Foundations: The Future of Housing in Scotland”, and given that in today’s papers the Cabinet Secretary for Health and Wellbeing argues that renovation of the dormant properties that are a blight on our town and city centres will be critical, the absence of creative thinking on the issue represents an abdication of responsibility. The minister should not simply make comments blithely.

Of course, the SNP’s approach is a feature of the alliance with the Conservatives that is evident in another area of tax policy—rates. I will come back to that, but first I will talk about the approach to VAT. The Conservatives’ paper, “Blueprint for a Green Economy” described the impact of VAT as “a damaging distortion”. Murdo Fraser rightly condemned the boom of the previous 13 years, which was built on a housing bubble and predicated on new greenfield homes becoming more and more expensive. That was, in part, the result of the distorted VAT structure in the UK tax system, which the Conservatives talked about in their paper and which John Purvis MEP correctly identified last year. The Conservatives’ paper said:

“we should seek ways to move away from the present situation to one which is more balanced.”

If a party says that the tax system should be “more balanced”, people expect it to say how it would make that happen.

Will the member give way?

I am sorry, I have no time to give way to Mr Fraser—if I find that I have time when I am further on in my speech, I will give way to him.

If the Conservatives want to rebalance the situation and reduce VAT on renovations, extensions, improvements and restorations, they must say where the money will come from.

The Conservatives do not agree with the Royal Institute of British Architects, the Construction Products Association or the Federation of Master Builders, which have repeatedly called for harmonisation or equalisation of VAT. That is fine—they can disagree with those organisations, but they should not go round the country complaining about the allocation of brand new greenfield sites in local plans or about the continuing trend of people moving away from, and choosing not to live in, town and city centres.

To some extent, I agree with the rest of the refrain from Mr Fraser and Mr McLetchie. We regretted the increase in national insurance. Where our approach differs is that if the intention is to reverse that increase, it is necessary to do slightly more than say simply that cutting out waste will pay for it. Mr Fraser is right to say that the tax increases for large businesses and the public sector because of the rise in national insurance contributions will cost jobs and will mean fewer teachers, nurses and police officers, but last week the Conservatives said that similar increases because of the rates revaluation would have no impact at all. It is simply inconsistent to say that one tax increase will cost jobs, whereas another will not. The Conservatives and the SNP have a joint approach to rates tax in Scotland.

Will the member give way?

I am sorry, but I have not got time.

There is no difference between the approach of the SNP and that of the Conservatives on rates tax. Mr McLetchie said that the increased rates tax would mean that money would be available to spend on cancer medicine. If the Conservatives’ position was that a doubling of the tax bill in Scotland as a result of rates increases would not have an impact, why should we believe what they say today? Their position is simply inconsistent.

We have heard that it is the wrong time for business in Scotland to be paying more tax. Mr McLetchie said that making business pay more tax would be the worst thing to do in a recession, but we might be surprised to learn that it emerged in an answer to a parliamentary question on 16 March about how much tax had been collected through business rates in each of the past three years, broken down by local authority area, that over the past year, businesses in Scotland have paid an additional £112 million in tax. For the first time ever in Scottish history, the tax take from business is more than £2 billion.

You should be finishing now.

We are told that a rise of 6 per cent, or £112 million, in the amount that businesses have paid in tax over the past year, during the recession, will not have an impact. A bit more consistency from the Conservatives in that regard would be welcome.

11:17

It will come as no surprise to members that the Conservatives do not intend to take any lessons from the Liberal Democrats on any form of taxation scheme. The transitional relief scheme that was hot property for the Liberal Democrats last week was such hot property that it did not make it into their manifesto. If Mr Purvis had spent a little more time reading his party’s manifesto instead of reading policy papers and quotations from former MEPs, he might have made a more useful contribution to the debate.

Mr Purvis twice refused to accept an intervention from me. I will take an intervention from him if he will answer this question. [Interruption.] Last week, he said—Mr Finnie was there, too—that his transitional relief policy would be funded by the £70 million of Barnett consequentials from the budget. However, the day before that, we were told that the largest slice of that money was to be spent on affordable housing. Mr Purvis may wish to tell us which of those issues is the biggest priority for the Liberal Democrats. Is it affordable housing or is it his transitional relief scheme? I will take an intervention on that point at any time during my speech.

With regard to rates increases across the board, do the Conservatives agree that, at the very least, there should be a transitional scheme in Scotland on the number of options that are available? Are the Conservatives in favour of any form of transitional scheme?

We have had no answer. Mr Purvis constantly has the demeanour of a man who has just lost his no-claims bonus. That is the case now.

We will take no lessons from the Liberal Democrats on their tax policy. The idea of putting VAT on new homes when we face the worst housing crisis since the second world war is ridiculous. The view that Homes for Scotland expressed yesterday—that the proposal is “sheer madness”—has been repeated frequently. First-time buyers would be hit disproportionately by it and they would be hit hard at a time when they are already struggling to raise deposits for a house. They would be penalised disproportionately by a higher rate of VAT on all new-build houses, which would be permanent. Once we moved away from a zero-rated VAT scheme, there would be no going back.

Let us focus on Labour’s motion, to which colleagues have responded differently. Mr Brownlee expressed surprise that Labour wanted to debate its record on the economy, and Mr McLetchie thanks Labour for allowing us to do so. In the parlance of “Yes Minister”, Andy Kerr’s decision to debate the issue was “courageous”.

We are happy to debate the economy. We say that the Scottish Government has caused a crisis in our construction sector.

Is Gavin Brown prepared to acknowledge that there have been fewer repossessions during the present global recession than there were during the recession under the Tories, and that unemployment and business bankruptcy levels are lower, too. Therefore, when it comes to the importance that is attached to tackling the recession, we will take no lessons from the Tories.

Instead of using the strict International Labour Organization definition of unemployment, we should look at the number of people who are out of work. The number of people on incapacity benefit is higher than the number of people who meet the ILO’s unemployment rules. Perhaps Andy Kerr ought to focus on that figure.

On employment, as all the Conservatives who have spoken in the debate have said, the biggest danger is Labour’s proposed permanent tax hike on national insurance, which could cost 5,000 jobs, and which will rip £63 million directly from front-line services and put it straight into the Treasury’s coffers. Labour had the opportunity to pull back from the proposal, but it chose not to, on the ground that doing so was a bad idea. Just after that, captains of industry signed up to the Conservative proposal to stop the tax hike. The Labour Party’s response was to say that industry leaders had been duped. How patronising is that? Just as Labour claimed that industry leaders had been duped, more businesses signed up to the Conservative proposal to stop the permanent tax hike on jobs.

That was followed, last week, by a bizarre intervention from George Foulkes and Jim Murphy, who both declared that employment increased the last time national insurance went up, and that increasing national insurance would somehow result in the same happening again. That was a ridiculous position to take as we hope to move towards recovery. This week, in a press release, Iain Gray suggested that Conservative plans to take £6 billion out of the Treasury’s coffers and put it into a tax cut would result in a doubling of unemployment. That eclipses even the comments of Lord George Foulkes and Jim Murphy.

A Labour Party headline this week said, “Brown decides not to have roll-call photo with industry”. The reality is that industry decided not to have a roll-call photo with Gordon Brown.

11:24

As we know, the Scottish economy entered recession in the middle of 2008 and returned to growth in the final quarter of 2009. Through our economic recovery plan, the Scottish Government’s response to the economic downturn has been flexible and dynamic. We have supported people and businesses through what has undoubtedly been a challenging time. We believe that we have acted decisively to support our economy and our construction sector. Last year, we maximised and accelerated some £3.8 billion of capital spending to support infrastructure investment and some 50,000 jobs across Scotland.

In addition, we are clear that our modern apprenticeships programme is of paramount importance to a strong economic recovery for Scotland, as it equips people with the training and skills development that are needed to gain long-term employment. Over the past year, we have acted quickly to put in place incentives to support businesses to take on a new apprentice, to recruit an apprentice who has been made redundant, or to protect an apprentice who faces the threat of redundancy. Indeed, our ScotAction programme represents the most comprehensive support package for apprenticeships in the UK. More than 20,000 people in Scotland started modern apprenticeships last year and are now receiving training and skills development to help them into long-term employment. Almost 3,500 of the starts were in construction-related jobs. We will continue to prioritise investment in skills and training this year by offering a minimum of 15,000 modern apprenticeship starts and a minimum of 34,500 training opportunities overall—and we will do more if we can.

At present, 79 companies and 160 modern apprentices in the construction sector benefit from the wage subsidy that is available through our safeguard an apprentice scheme. Given the continued uncertainty in the labour market, we will continue to offer both that and the successful adopt an apprentice scheme through to March 2011. I hope that that answers a point that was raised by Marilyn Livingstone.

Today’s debate has raised a number of issues that I want to address. First, I thought that Andy Kerr’s opening speech was a very poor start to the debate. Coming from a council where we are used to much higher standards of debate, I was disappointed that he managed to get through 13 minutes of a speech without mentioning Labour’s recession. Speaking for 13 minutes without acknowledging the 13 years of the failure of the Goldman Sachs-type Government that we have had in the UK takes some skill in itself, so perhaps that justified the tiny mention of skills that he made at the end of his speech.

The SNP’s manifesto in 2007 proposed the end of gold-plating financial regulations so as to increase the financial services market in Scotland, but in this debate the minister somehow suggests that he would have introduced more regulation, rather than less. His manifesto said otherwise.

The point was asked about and answered earlier on. We prefer to have less gold plating, but certainly not the Goldman Sachs-type Government that we have had from Andy Kerr’s party in the UK over the past 13 years.

I regularly talk to people in the sector skills councils and representatives from the construction industry, and there is no question but that there is a great deal of support for the Scottish Government’s ScotAction programme. There are one or two who have different views on how we could best go about addressing the problems, but without exception people are clear about the cause of their concerns in the construction industry: it is, first and foremost, Labour’s recession. They know that that is the big problem. How we try to deal with it is obviously a matter of debate.

Last year, in agreement with the Labour Party, we aimed for 18,500 apprenticeships, and we have exceeded that with 20,000 apprenticeships—the figure will be beyond that by the end of the year. From my discussions with the industry, I think that it will be troubled by Labour’s new policy development to guarantee apprenticeships. That is incompatible with the employer-led apprenticeship scheme that we have. That scheme was not followed in England, where people now wish that it had been. It will be interesting to see in the coming days how Labour members explain the change in policy and how they will fulfil a guarantee of an apprenticeship for young people. On our part, we guarantee, and are happy to work with others who support it, the idea that there is a training opportunity or apprenticeship for people in that age group. However, not everybody can be guaranteed an apprenticeship under the current scheme. It will be interesting to see what happens.

As for the Lib Dems, I do not deny that there is something to be said for the idea of encouraging refurbishment and not always new build—if only that had been the case in the eight years of the Labour-Lib Dem Administration, when every PFI project channelled in the idea of new build rather than refurbishing existing buildings.

That is not true.

It is true. The three new projects that we have in Clackmannanshire are all new build, and the five PFI schools in my constituency are all new build. In many of those projects, there were other options, but they were not taken. It is a late conversion from the Lib Dems to favour refurbishment over new builds.

I have mentioned before the Lib Dems’ idea of applying VAT on new houses. Everybody in the construction industry says that the problem is a lack of access to finance, especially for first-time buyers. The idea of addressing the problem by whacking VAT on new houses is complete nonsense.

Ian McKee made the point that both Labour and the Lib Dems support minimum alcohol pricing down south but oppose it up here. It is not good enough to have the one-word answer, “Devolution”. The Lib Dems have to explain why the situation up here is different, but they have failed to do that. It seems that there is simply political posturing from the Lib Dems, who are the shapeshifters of Scottish politics—they will take a different point of view depending on the issue and the support that they will get for it.

Is the minister accusing of supporting nonsense the Royal Institite of British Architects, the Royal Incorporation of Architects in Scotland, the Federation of Master Builders, English Heritage, the Heritage Link and the Construction Products Association, all of which have campaigned for equalisation of VAT because they recognise the enormous difficulty and impossibility, particularly in Scotland, of dealing with the 70,000 houses that are not in use? That is not Liberal Democrat posturing; those are genuine organisations. If you want to take them on, minister, please do.

Ross Finnie can misinterpret my words as he will. [Interruption.] I am attacking the Lib Dem proposal to apply VAT to new house building. I hear from some of the sedentary interventions from Labour members that they seem to support the idea, too. Let us see whether they will propose that in the last two weeks of their election campaign. It is simply the case that the policy will not fly. It is exactly the wrong thing for the construction industry in Scotland.

As I said, we have started more than 20,000 apprenticeships during the current year. I would take some of the criticism from Labour members a bit more seriously if they had actually voted for the apprenticeships that we have had this and last year. However, they did not do that—they voted against them.

I say to Sarah Boyack that there is no credibility in attacking the boiler-scrappage scheme, which we are having to introduce—[Interruption.]—once we get the consequentials. You failed to vote for it. People throughout the country know that you failed to vote for the scheme, so you have no credibility on it whatsoever.

Marilyn Livingstone and one or two others raised a point about having to explain to apprentices in her constituency why they have lost their job. She asked Keith James Brown; perhaps she should ask James Gordon Brown. He is from Fife too, and by far the biggest cause of people losing jobs just now is Labour’s recession. Labour members know that, but they have failed to mention it throughout all the interventions that we have had from them.

The construction industry is saying that the SNP needs to sort out its Scottish Futures Trust. There needs to be a steady stream of projects. That is your responsibility, minister—no one else’s.

Marilyn Livingstone is still failing, even given another chance to accept responsibility for the recession that the Labour Party has caused. [Interruption.] I actually think that she made a valuable contribution when she spoke, but I have the right to answer some of the points that she made.

Linda Fabiani and Ian McKee made excellent speeches, and there were some humorous speeches from elsewhere.

When Mr Whitton sums up, Labour will have one final chance for an apology for what has happened.

You should be finishing now, minister.

There are millions of people across the UK and hundreds of thousands in Scotland whose lives have been really badly affected by the recession. Labour cannot go through a debate on the economy—a debate that it called for and for which it wrote the motion—and fail to apologise for what the Labour Government has done to people in Scotland.

Finally—

Finish now, please.

Labour can try to ignore the elephant in the chamber, and the Lib Dems and Tories can fight among themselves, but as a Scottish Government we will continue to do what we can to help the people of Scotland get through Labour’s recession.

11:32

Labour called this debate today because the failure by the SNP to deliver a steady stream of capital projects in the pipeline has been one of the main reasons for the dramatic decrease in confidence in the construction sector in Scotland and for the equally dramatic increase in the numbers of unemployed tradesmen and apprentices in such a vital part of the Scottish economy. We think that a party that continually boasts that its number 1 priority is sustained economic growth would have paid some attention to what its policies are doing to the construction sector but, on the evidence, we would be wrong.

We have heard the statistics today. I believe that all members should sign up to the Labour motion that ministers should

“provide every young person with the right to quality training, including advanced apprenticeship or technician level training for those who are qualified.”

Mr Brown is shaking his head—

No, I am nodding.

That is excellent. I am glad that we agree on that, because Mr Brown knows as well as I do that apprentice training is not just in the construction industry—it covers the whole breadth of Scottish industry.

In this “balanced Parliament”, as the First Minister now likes to call it, we should all be concerned with promoting economic growth and using all the money and means available to create as many jobs as possible.

As Mr Brown has agreed, we will hold another apprentice summit next week, when I hope that he, as the skills minister, will announce an extension of the ScotAction programme, with further support for the adopt an apprentice and safeguard an apprentice schemes. Indeed, if I heard him right, he will do that. I also hope that the SNP will look again at the invest in an apprentice scheme, as the budget for the last hurried extension was used up within 10 days, with demand far exceeding supply. Those are all ideas that we have pushed for in budget discussions in the past two years.

Let us not forget older workers who are keen to retrain or to take on apprenticeships. This week, a constituent contacted me about a construction apprenticeship. He is 32—still a young man—and desperate to get a construction-related skill. I asked Skills Development Scotland, which said that there is no help for him unless he is aged 16 to 19. It referred me to Careers Scotland, which said, “Yes, it is difficult, but we’re sorry—there is still no help for that age group.” I then approached Construction Skills Scotland, which said that funding is available, but only if my constituent finds a forward-thinking employer who is willing to take on an older apprentice. Graham Ogilvy, who is the chief executive of Construction Skills Scotland, says that we need to fund adult apprenticeships properly if we are to get people to re-train. I understand that some European money might be available for that. If so, can we get it started as soon as possible? I ask that not just for my constituent, but for thousands like him.

What exactly can we do? We all agree that we need to push apprenticeships as the best available vocational entry route, thereby keeping apprenticeships at the front of the minds of employers, local authorities and students. Public funding must be prioritised towards employability, basic skills and the people who face severe disadvantage in the labour market. Not all young people will have the qualifications for a modern apprenticeship, so programmes such as training for work and get ready for work must be extended in order to bridge the gap, especially in the most deprived areas. It would help, too, if Skills Development Scotland would spend all its budget for those particular budget lines.

Statistics show that nearly 25 per cent of 16 to 19-year-olds in the 15 per cent most deprived areas are still not in employment, education or training. It is hard to find places for those 16 to 19-year-olds, and when the Scottish construction industry forecasts that there will be 51 per cent fewer apprentices in 2010, the situation becomes much more difficult. Yesterday’s gross domestic product figures are not too encouraging, either. The bare facts are there to see. A survey by the Scottish Building Federation found that 24 per cent of firms expect to have to reduce their workforce in the course of 2010. A quarter of the firms that responded to the survey said that they expect to employ fewer apprentices this year, and almost half expect to be unable to employ any.

Does the member share my pleasure in the fact that the report of the Construction Skills Network, which was published in January, shows that, overall, the construction industry in Scotland expects an annual growth rate of 2.8 per cent, which is higher than the UK figure of 1.7 per cent? Does he recognise that the expansion of the construction industry will provide more jobs for apprentices as they come on stream?

I am grateful to Dr McKee for that information, but that is a projection, not a fact. The bare facts are there to see, and the Scottish Building Federation found that 24 per cent of firms expect to reduce the size of their workforces.

We need action and more targeted Government support to retain apprenticeship places specifically in the construction sector. We must maintain public sector investment until the private sector picks up. The construction industry is forecast to remain in recession until at least 2011, and steady public sector investment is crucial to its recovery. Now is the time to do more and to increase help as the economy recovers. We must provide support to enable businesses to give young people a job, apprenticeship or internship, not take it away. That is why so many members of Scotland’s business community found the decision to cancel the Glasgow airport rail link—a project that would create 1,300 jobs—inexplicable.

Instead, as Mr Kerr highlighted, we have had the Salmond slump, which has cost almost 30,000 construction jobs through the stagnation that has been caused by the Scottish Futures Trust. [Interruption.] SNP members are laughing, but those are the facts. The business plan of the SFT, which was published a few days ago, states under its objectives for 2010-11 that it wants

“to enable the delivery of the first primary school by 2011.”

There we have it. Four years after coming to office, the SNP’s fantastic funding provider may deliver its first primary school in 2011. Given that rate of progress, it is little wonder that there are thousands of construction workers currently out of a job, and that apprentice numbers are falling.

Mr Mather got uncharacteristically heated about the reasons for the global recession. He spoke of SNP policy creating 15,000 jobs. Where are they? Even the Scottish Parliament information centre struggles to identify them. The minister also asked Sarah Boyack whether she understands the cause and effect of the crisis. That is ironic, because the effect—unemployment of many construction workers and apprentices—has been caused by his wasting three years trying to form the Scottish Futures Trust.

Does the member regret the fact that the only lasting legacy from Labour is a devaluation and debasement of the currency, which every Scot experiences every time they go to the petrol pumps?

You have about half a minute left, Mr Whitton.

As I said, the minister is getting uncharacteristically heated.

Mr Gibson demonstrated similar myopia in saying that “spivs and speculators” were the cause of the global recession. Does he blame Sir George Mathewson, who was flown halfway round the world to chair the First Minister’s Council of Economic Advisers and who is also the chair of a hedge fund that was short selling Royal Bank of Scotland shares?

Unfortunately, time does not allow me to address any other members’ speeches.

We want to see a green jobs skills strategy and Scotland working hard to create jobs in that area. Yesterday, we debated transmission charging and heard a lot about wind and wave turbines. We need workers with the skills to take up the job opportunities that will flow from the renewables industry, but there is no skills strategy to follow the renewables strategy. We also need the SNP to stop dithering and start delivering on capital projects and the SFT, so that Scotland’s construction industry can get the boost that it needs.