1. What recent discussions he has had with the Chancellor of the Exchequer on the operation of the Barnett formula as it affects Scotland. (140952)

The Government have no plans to replace or review the Barnett formula, which has delivered fair, stable and transparent settlements for Scotland, Wales and Northern Ireland under successive Administrations for almost 30 years.

Public expenditure in Scotland is £8,414 per head, yet in the east midlands it is a quarter less, at £6,334. In Wellingborough, a secondary school has been demolished, there have been cuts in the police force and we do not have a local hospital. Why should the population of Wellingborough and the rest of the east midlands subsidise the population of Scotland by the massive amount of £2,080 a year? What is the justification for that huge difference in public expenditure?

In every constituency, in every part of every region and nation of this country, there has been a massive increase in public services: more schools, more doctors, more nurses. As it happens, investment in public spending in Scotland has increased in the past five years by 18 per cent., but in England it increased by 21 per cent., so there are higher rates of increase in England. As the hon. Gentleman has brought it up, I should point out that in his area there are 420 more teachers than in 1998, 163 more police officers and 62 police community support officers. In his NHS area, there are 6,886 more nurses, 725 more consultants, 353 more GPs and 548 more dentists—all on account of strong economic management by the Government—

Order. I think the hon. Member for Wellingborough (Mr. Bone) has got the point.

Recently, I had the privilege of chairing an all-party review of services for disabled children. The Treasury’s response was to target £340 million for England and £34 million for Scotland. May I have my hon. Friend’s assurance that nothing in the Barnett formula will prevent us from continuing to negotiate with the Executive to ensure that funding is indeed targeted at disabled children and the needs we identified?

It is only right to point out that my right hon. Friend has done more to advance the cause of disabled children than almost any other Member of the House, and much tribute is due to him. He is right to point out that as part of the comprehensive spending review settlement for the Department for Education and Skills in England money additional to that agreed with the Barnett consequentials at the time has been made available. His point underlines the fact that, because of the strong economic performance of the United Kingdom over the past 10 years, significant sums of additional money are going to education and health in Scotland, as they are throughout the rest of the UK. Obviously, it is for each of the devolved Administrations to decide how to spend the money made available to them, but my right hon. Friend makes an excellent case that additional resources should be spent on services for disabled children, and I look forward to that happening.

When the Minister next has discussions with the Chancellor, will he also raise the issue of moneys not contained in the Barnett formula, particularly Nuclear Decommissioning Authority funding for decommissioning at Dounreay? He will be aware that earlier this year there was a severe threat to Dounreay caused by problems outside Scotland. Will he ensure that his right hon. Friend is aware of that so that such threats do not reoccur in future years?

I am happy to have that conversation and to inform the hon. Gentleman that I shall be visiting Dounreay next Friday, where I will be able to hold discussions with local management. If the hon. Gentleman wants to come along—[Interruption.] I am telling him now. Don’t start with the “no phone calls and no letters”—I am telling the hon. Gentleman now that I shall be there next Friday, so why do he and I not sit down with local management at Dounreay and discuss all those issues?

2. What assessment he has made of trends in the level of economic activity in Scotland since the 2005 general election. (140953)

If I may, Mr. Speaker, I shall begin my answer by placing on the record condolences on behalf of the whole House on the passing of the noble Lord Ewing who served the House and Scotland with great distinction.

Since the 2005 general election, output in Scotland’s economy has grown at above the long-term trend rate. In employment terms, economic activity has increased and is now at a record high.

Does my right hon. Friend agree that such growth and stability in the Scottish economy do more for all our constituents in Scotland than constitutional wrangling?

I certainly find myself in agreement with my hon. Friend. Last week, I had the opportunity to visit China, where I met a range of British businesses, including Scottish businesses, which are investing in that expanding economy. When one has the opportunity to meet such business people and discuss with them the challenges facing Scottish business in the global economy, it is perfectly obvious that the economic stability of the past 10 years has provided strong foundations on which to seek new markets, new prosperity and new jobs for Scotland.

On behalf of the Scottish National party, may I associate myself with the comments that the Secretary of State made about the record of public service of Lord Ewing?

Has the Secretary of State read the newly published survey of success by the Federation of Small Businesses that sadly shows Scotland lagging as the worst-performing country in western Europe? I know that the Labour party has just lost political hegemony after 50 years in Scotland, but what responsibility does it accept for this woeful state of affairs? How long will it take for the only party in Scottish politics that as yet holds out against more powers for the Scottish Parliament—the Labour party—to reassess that, join the rest of us and give the Scottish Parliament the powers to improve the economy and society of Scotland?

Notwithstanding that characteristically gracious question, may I pass on my congratulations to the hon. Gentleman on assuming the leadership of the Westminster group of his party? I fear, however, that he will continue to articulate a case of “Scotland the Victim” rather than “Scotland the Brave”. If one actually takes the opportunity to consider the FSB index of success report, one will recognise that Scotland is above Switzerland, Sweden, Ireland, Iceland, Denmark and Norway in terms of educational attainment. Scotland ranks seventh out of 32 for employment, representing equality of opportunity and how that comes about.

Of course, it is right to recognise that we face a very considerable challenge in terms of life expectancy and public health. Those areas of responsibility touch on the issue of poverty, for which both this House and the Scottish Parliament have responsibility, but I fail to see from the hon. Gentleman’s argument how additional powers would help the Scottish Parliament, given that it has responsibility for health policy in Scotland. If he is concerned about health inequalities in Scotland, he will be better discussing them with the First Minister.

May I associate myself with the Secretary of State’s remarks about the sad passing of Harry Ewing, who contributed an enormous amount to my election in 1992 when I defeated Jim Sillars of the SNP—a fact greatly welcomed by all concerned?

Is the Secretary of State aware that unemployment in my constituency has come down by more than 50 per cent. since 1997, but is he also aware that I am still not satisfied? Can he therefore tell us when he will be arranging for there to be an announcement about the orders for the two aircraft carriers?

I know of long standing that my hon. Friend is always proud but not satisfied in relation to employment in his constituency. His constituency is just one of the many constituencies—not just in Glasgow or west central Scotland but across the whole of Scotland—that has seen unemployment tumble in recent years as a direct consequence of the economic stability of which I was just speaking. Of course, much further work needs to be done in Glasgow, and it is the case that Ministry of Defence orders to British shipyards in Scotland have contributed significantly to the employment success that has been achieved in recent years. However, this Government recognise that more needs to be done.

I echo the tributes to Lord Ewing and, in particular, pay tribute to his role as joint chair, along with Lord Steel, of the Scottish Constitutional Convention that delivered many of the changes that Scotland benefits from today.

May I concur with the Secretary of State that many parts of Scotland are performing well and have the potential to develop more strongly? However, for that to happen in places such as the north-east, we need continual investment in infrastructure—for example, the western peripheral route and a commuter rail service between Inverurie and Stonehaven—and a regime for oil, gas and energy that encourages long-term development and investment. For businesses in my constituency, being part of a strong Scotland within a strong United Kingdom is an overwhelming priority.

Somewhat unusually, I find myself broadly agreeing with the sentiments expressed by the right hon. Gentleman. It is of course the case that we want to see continued investment on the UK continental shelf in the North sea. Although the primary responsibility is with the Scottish Executive, it is also the case that we want to ensure that there is an infrastructure to support sustained economic growth. It is also the case that that has taken place not just on the platform of economic stability but as part of a significant global economy. That is why Scotland has enjoyed such economic success in recent years.

3. What discussions he has had with Scottish Ministers on the planned Act of Union celebrations in Scotland. (140954)

A range of activities has been planned to celebrate the Act of Union, some of which have taken place already. As you are aware, Mr. Speaker, you and the Lord Speaker earlier today opened an exhibition in the Royal Gallery in the other place displaying some of the historic documents associated with the treaty of Union. That exhibition is due to travel to the Scottish Parliament later in the year.

Does the Secretary of State share my concern that what is undermining the Act of Union celebrations is not just the SNP victory in the Scottish parliamentary elections, but the fact that there is growing resentment in England about the unfairness of the constitutional settlement since devolution? Does he agree that the only way to ensure that we can celebrate the Act of Union in the long term—and, indeed, to save the Union in the long term—is to ensure that Scottish MPs in this House do not vote on matters that apply only to England?

I am not convinced by the case that the hon. Gentleman outlines. Opportunism is vying with principle on the Conservative Benches, as the Conservatives try to frame a policy on the United Kingdom. I am somewhat more optimistic than he is about the future of the Union, given that—notwithstanding the election of the First Minister a few weeks ago—at the elections the Scottish people overwhelmingly rejected the party that sought separatism. Two out of three votes cast were clearly in favour of the Union.

Does my right hon. Friend agree that the Union of Scotland with other parts of the UK does far more for each and every part of the UK than narrow nationalism ever will?

I find myself in agreement with my hon. Friend, and not simply for the historic reasons relating to the strength that the Union brings to Scotland and England—the shared history, the common geography and the trading links that we have enjoyed in recent centuries. Looking to the future, the ability to balance the strength that we draw from each other with a recognition of diversity is a powerful message to send to the whole world. What a dismal message it would send to the world if, on the 300th anniversary, people were to judge that, instead of working together, we should split apart.

The Secretary of State and the Scotland Office have played an absolute blinder on this one. Look what we have secured in this anniversary year: we have a brand-new shiny £2 coin and a brand-new shiny SNP Government in Edinburgh. Will he pledge to continue to do what he has done so well and reflect the public’s enthusiasm for this celebration by continuing to do not very much at all?

What powerful eloquence from the hon. Gentleman. The fact is that Scottish people recognise that there is something useful about having a £2 coin—in clear distinction to an SNP-led Administration.

Surely the best way of celebrating this magnificent anniversary would be to reject once and for all the idea that some Members of the House should be prevented from voting on some matters before it. That is an undemocratic, anti-British proposal that would create a de facto English Parliament and lead inexorably to the break-up of Britain.

I know that my hon. Friend is tireless in his advocacy not just of his part of the west midlands, but of the case for the United Kingdom. A United Kingdom needs a united Parliament. The argument that Members on the Opposition Benches sometimes articulate—that somehow there is a great oppression of England by Scottish MPs—ignores the fact that more than 80 per cent. of the House is not composed of Scottish MPs. The House reflects the geography and the population shares of the respective nations of the United Kingdom. I am convinced that there is a strong case for having a single class of MPs who are able to legislate on the matters that come before the House. That has served us well in the past, and I believe that it will serve us well in the future.

May I associate Conservative Members with the Secretary of State’s comments about Lord Ewing?

I am sure that the Secretary of State will agree that one aspect of the Act of Union to be particularly celebrated is the retention of Scotland’s distinct legal system. So like me and Jack McConnell, was he appalled by the Prime Minister’s apparent willingness to ride roughshod not just over the Scottish legal system but over the whole devolution settlement in seeking to agree a prisoner exchange deal with Libya? What hope can we have for the continuation of the Act of the Union if the First Minister and the Prime Minister do not even communicate?

I have something of an advantage over the hon. Gentleman—not only by being educated and trained in Scots law, but by having practised as a Scottish solicitor. Greater familiarity with the tenets of constitutional law, including the Scotland Act 1998, might allow him to recognise the error of his statement. The memorandum of understanding states:

“The UK Government will seek to obtain the agreement of all three jurisdictions within the United Kingdom in each case.”

That is entirely consistent with the devolution settlement.

What is not consistent with the devolution settlement is the discourtesy that was shown to the Scottish Parliament and the Scottish Executive by the Prime Minister in failing to raise this issue before he began the discussions. Does the Secretary of State agree that the best way to celebrate the Union is to demonstrate our commitment to it in all our actions? Surely that means that when a memorandum of understanding is signed between the United Kingdom Government and the devolved Administrations it should be adhered to; that when a joint ministerial committee is set up, it meets; that when Scotland elects a First Minister, the Prime Minister speaks to him; and that if the intergovernmental relations as previously envisaged are not fit for purpose, they are revised. Is it not about time that the Secretary of Scotland showed his commitment to the Union in deeds, not words?

Forgive me, but I have some difficulty taking seriously the hon. Gentleman’s assertions of his commitment to the Scottish Parliament. This is a man who was, in one of his own memorandums, somewhat scathing in his views of his colleagues in the Scottish Parliament. On the integrity of the United Kingdom constitutional settlement in light of the memorandum of understanding, there is nothing in the memorandum of understanding that is prejudicial either to the interests of the jurisdiction that rightly continues to be the province of Scots law, and indeed of the Scottish Parliament, or to the right of the UK Prime Minister to negotiate on foreign affairs on behalf of the United Kingdom.

4. What plans he has to make changes to the electoral system in Scotland. (140955)

The Government have no current plans to make changes to the electoral system in Scotland.

We have just heard the Secretary of State say that notwithstanding the fact that two out of three voters voted to continue the Union, we face a perverse situation in which the party in government in Scotland is determined to push for independence. The Under-Secretary of State will recently have heard many of his Labour colleagues call for a return to the first past the post system, so will he instigate a review and consider returning to a simple, clear method of electing Members of the Scottish Parliament, namely the system that we have here—first past the post?

We set up an independent commission, led by Sir John Arbuthnott, to consider the consequences of having different electoral systems in Scotland. He and his commission looked into the matter and came back with the recommendation that we should not move back to first past the post, or move to the single transferable vote system right across Scotland, but that we should keep the current system as it is. It is a reflection of the fact that during the Scottish Constitutional Convention, there was an attempt to reach consensus. Perhaps if the hon. Gentleman’s party had taken part in the Constitutional Convention, it might have been able to make the hon. Gentleman’s comment at the time. We have a system and it has produced a result that we openly acknowledge: it has given the Scottish National party a one-seat advantage, but it should not think that it has any mandate whatever to break up the United Kingdom. That would be going against the clear wishes of the vast majority of the people of Scotland.

But will the Minister accept that the voting system for this place should remain as it is—that is, that it should be first past the post?

Yes.

As the newly elected Scottish Executive have a good Gaelic song, doubtless the SNP could have looked forward to election victories regardless of the voting system used. However, is it not the case that Scotland’s electoral system should be a matter for Scotland’s Parliament and all the parties within its Parliament?

The Scotland Act 1998 is very clear: issues relating to the constitution are reserved to this place, and that includes the electoral system for the Scottish Parliament. We have no plans to change that.

When looking at the Scotland Act, will Ministers consider the position that it is completely wrong that someone should be able to stand under first past the post, under the list system and for a local authority, and so may fail in the first, fail in the second and fail in the third? There are parties in which people are able to do that, whereas in our party we stand for only one position. Surely that is right.

I think that it is probably best to leave the issue to the individual parties concerned; it is up to them to make a decision on whether they should have people who are on the list, who stand under first past the post and who stand for the council, too. My hon. Friend will be aware, of course, that the Arbuthnott commission looked into that, and rather explicitly ruled it out.

I am sure that all Members want trust in our electoral system to be restored after the mess of last month’s elections, and a full and comprehensive inquiry is clearly vital to that. However, we now face the ludicrous situation in which the inquiry investigating the thousands of spoiled ballot papers will not be able to see a single one. Will the Minister tell me why he has not yet brought forward the necessary legislative changes to ensure that the inquiry is able to examine the spoiled ballot papers, and will he do so now?

We have been absolutely and consistently clear: the inquiry is independent of Government, and an independent international expert has been brought in to lead that inquiry. If I were to start second-guessing what those carrying out the inquiry might ask for, or how they should go about their inquiry, I would rightly be accused of interfering with it. We have said that we stand ready to co-operate with Mr. Gould, and so we do.

The Minister will be aware that the subject of the elections was raised at First Minister’s questions in the Scottish Parliament on 31 May, when the First Minister referred to his telephone discussions with the Secretary of State. Although I am pleased to learn that they were cordial, the First Minister also indicated his intention to push for

“a more thorough and independent inquiry”—[Scottish Parliament Official Report, 31 May 2007; c. 316.]—

into the Scottish election debacle. Will the Secretary of State and the Minister accede to that request?

The First Minister has not actually made the request, so it is difficult for me to accede to a request that has not been made. I have not had a telephone conversation with the First Minister, but I had the unalloyed joy of spending three hours with him over a curry in Renfrew a week last Sunday, and he did not raise the matter with me then, either. If he says one thing to the Scottish Parliament and does not say it in this place, that highlights the fact that he has a seat here and if he came and took his seat and served his constituents in Banff and Buchan, he could make that point to us at Scottish questions.

5. What assessment he has made of the impact of the proposals in the Energy White Paper on energy production in Scotland. (140956)

Scotland has the potential to benefit significantly from the Government’s energy policy, as set out in the White Paper.

But as we have seen, the White Paper may lead to a loss of investor confidence. We have lost the carbon capture and storage project in Peterhead. We need clarity from the Government for investors. To that end, will the Minister rule out entirely any liability for nuclear waste or nuclear decommissioning from new generation plant falling on the public sector?

As my right hon. Friend the Secretary of State for Trade and Industry said at the Dispatch Box on Thursday, in response to a question from the hon. Gentleman, I think, we are sorry that BP is not going to continue with the competition, but there are seven other important players in that competition. It was never the case that the Government could simply hand out the necessary awards to one particular company. Even if BP had stayed in with the Peterhead project, there is no guarantee that it would have won the competition in any event. However, the Government’s position on new nuclear build was set out comprehensively in the White Paper. It is not for the Government to build nuclear power stations. It is for industry to come forward to Government and say that it would like to build a new nuclear power station. At that point, the discussions can take place.

I too pay my tributes to Lord Ewing, who was a good friend and colleague and a great parliamentarian. He will be a loss to both Parliament and Scotland. I send my best wishes to his wife Margaret and his family.

May I press the Minister to accept that, in view of the utterances from the new leadership in the Scottish Parliament, an important issue such as the energy White Paper would be better discussed by the Scottish representatives at Westminster in the Scottish Grand Committee? I cannot think of anything more important to discuss in the Scottish Grand Committee than the energy White Paper.

My hon. Friend’s tenacious advocacy of the Scottish Grand Committee reflects well on him. It is a matter for the usual channels and the House authorities to instigate Grand Committees. I point out that since the Grand Committee stopped meeting regularly, it is possible to hold one and a half hour debates on important issues in Westminster Hall, and it is open to my hon. Friend to apply for such a debate.

Following on from the discussion of nuclear power in an earlier question, if a company wished to build a new nuclear plant in Scotland, would it be up to the Scottish Executive to make that decision or would it be up to the Department of Trade and Industry?

The situation is crystal clear. The Scottish Executive would have the final say on any application for a new nuclear power station in Scotland or even for any non-nuclear significantly large power generator, both under the Electricity Act 1989 and under planning legislation.

6. What assessment he has made of recent trends in macro-economic activity in central Scotland. (140957)

Central Scotland has benefited from the stability generated by the Government’s management of the economy, which has delivered above trend economic growth and the strongest labour market for decades.

May I associate myself with the remarks about Lord Ewing, who represented Falkirk in this place and will be sadly missed here?

My hon. Friend will be aware of the remarkable and historically high levels of employment in the Falkirk area. Does he agree that the future success of the economy of central Scotland, and particularly the Falkirk economy, will be based in large part on our unrivalled communication links and the intelligent use of land?

My hon. Friend is right. Unemployment in his constituency stands at 2.5 per cent., which is below the Scottish average. I am sure that Lord Ewing would have liked to be able to say that during his time representing that constituency, when throughout long periods of the last Conservative Government places such as Falkirk were severely blighted by high unemployment. Falkirk now has a wonderful opportunity to take advantage of the thriving economy in central Scotland, including the thriving financial services sector and the great improvements that are being made in the manufacturing sector. At the heart of that lie the key transport links. I know that for as long as my hon. Friend is a tireless advocate, the future will be very bright for Falkirk.