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Volume 624: debated on Wednesday 19 April 2017

The Secretary of State was asked—

Scotland’s Contribution to the UK

As the Prime Minister has said,

“at the heart of the United Kingdom is the unity of our people: a unity of interests, outlook and principles. This transcends politics and institutions, the constitution and the economy. It is about the values we share”

and our “solidarity”. I will never stop making the passionate and positive case for our United Kingdom, and I look forward to having the opportunity to do so during the forthcoming general election.

With the Defence Secretary confirming a £1.7 billion investment in Scottish military bases, does my right hon. Friend agree that Scotland plays a crucial role in defending my constituents in Eddisbury and those throughout the whole United Kingdom from growing threats at sea, in the air and on land, and that the divisive policies of the nationalists threaten that crucial role?

I absolutely agree with my hon. Friend—Scotland is on the frontline of defending the United Kingdom from growing threats at sea, in the air and on land. It is the home to essential defence capabilities, and our commitment to the future of defence in Scotland is underlined by increasing investment in better infrastructure for our armed forces, which is helping them to keep the whole of the United Kingdom safe.

Given that in the last quarter the Scottish economy contracted by 0.2%, is it not about time we got off the independence referendum—and, indeed, the general election—merry-go-round, and got the Prime Minister and the First Minister to concentrate on what is important, which is the economy of Scotland?

The hon. Gentleman would have a lot more credibility in making that statement if he was not standing on the ticket of a leader who has said that he has no problem with another independence referendum and who clearly would do a deal with the Scottish National party to get the keys of No. 10.

Will the Secretary of State confirm that Scotland’s membership of the single market of the United Kingdom is more important to Scotland than its membership of the single market of the European Union?

My hon. Friend is correct. It is absolutely right to highlight the fact that the market for Scottish goods and services in the rest of the United Kingdom is four times greater than that market in the EU. The UK is the vital Union for Scotland.

In the last few years, Iceland and Ireland have leapfrogged the UK in terms of growth and deficit reduction, and they have always had a higher GDP per capita over the last 10 years. Norway’s oil fund is now $920 billion, having grown by $105 billion from $815 billion. The equivalent figures for the UK are zero, zero and zero. Does the Secretary of State not agree that Scotland could be as good as tiny Iceland, as good as Ireland and even as good as Norway with our independence? What is he scared of for Scotland?

I well remember when the SNP advocated the “arc of prosperity” for Ireland, Scotland and Iceland. I very much doubt that the people of Scotland would want to endure the pain that the people of both Iceland and Ireland have endured to ensure that their economies are back on a stable footing.

Perhaps all of us on this side of the House can agree that Scotland’s greatest contribution has been to show that there is actually an alternative to the destructive policies of this UK Tory Government. It is worth remembering that in Scotland we have free prescriptions, free eye tests, free childcare and free university tuition. We have scrapped bridge tolls, reopened railways and invested in infrastructure, and we are building more council houses than any UK nation. That is what the SNP has delivered in government in Scotland. Does the Secretary of State not agree that that stands in marked contrast to the Tories’ mismanagement and destruction of public services south of the border?

What I see in my constituency is falling educational standards, with Scotland’s once-proud education system having the lowest international ratings ever. What I see is my constituents experiencing increasing waiting times for the health service and having to deal with inadequate infrastructure. I do not believe that the SNP Government in Scotland are focusing on the day job. They are focusing on their obsession—independence.

Quotes about doing the day job when the Government are calling an early general election are a bit cynical. Let us rest on a neutral observer, not a Tory party research officer. What about the director of the Institute of Health and Society, who said:

“Scotland is in a much stronger position than England with respect to both health and social care”?

He went on to say:

“The problem is at the moment that the English government is not committed to a national health service”.

Is not that another example of the fact that the real alternative to the Tory UK Government is the progressive policies of the SNP?

Absolutely not, and I look forward to debating these subjects over the next six weeks. The right hon. Gentleman was very careful not to mention education standards in Scotland, which the latest international figures demonstrate are the lowest ever on record. That is not a proud record of the Scottish Government. I look forward to holding them to account over the next six weeks.

Joint Ministerial Committee

2. What assessment he has made of the effectiveness of the Joint Ministerial Committee in ensuring that the needs of all regions and nations of the UK are taken into account in negotiations on the UK leaving the EU. (909642)

In our negotiations with the EU, we will be seeking the best deal for all parts of the UK. The Joint Ministerial Committee (EU Negotiations) was established to facilitate engagement between the UK Government and devolved Administrations, and has had regular substantive and constructive discussions.

If the Secretary of State is so keen on and supportive of the JMC, why did the Government vote against putting it on a statutory footing for Brexit negotiations during the passage of the European Union (Notification of Withdrawal) Act 2017? Secondly, when was the last time a positive idea—I am sure that there have been many from the devolved Administrations—was taken on board to form part of the Brexit negotiations to improve the exit from the EU for the devolved nations?

We have been very clear about “Scotland’s Place in Europe”, the Scottish Government’s contribution to the discussions. There have also been constructive contributions from the Welsh Government and the Northern Ireland Executive. They have set out many things that formed part of the White Paper and the Prime Minister’s speech. They will be part of the discussions as we negotiate our exit from the EU.

The role of the machinery of government in helping to hold together the United Kingdom is an important issue. Does my right hon. Friend agree that a priority for the new Government should be to take a long, hard look at developing new ways of working between Ministers and civil servants across the devolved Administrations to strengthen our United Kingdom?

I absolutely agree with my right hon. Friend, who has considerable experience. Despite what we hear at Question Time and in the media, the UK Government and the devolved Administrations are able to work together very closely and constructively on a range of issues. That is the element that we should support and promote.

The Prime Minister told the Scottish Parliament that

“now is not the time”

when it wanted to let Scotland decide its own future and relationship with Europe, but now is the time for a screeching U-turn and this opportunistic general election. Does the Secretary of State therefore also believe that it is time for the Scottish people to reject the UK Government’s austerity obsession, their assault on the poor, the obnoxious rape clause, and their desire to drive Scotland over the cliff edge of their hard Brexit?

I acknowledge that the hon. Gentleman is an expert on screeching, but the Prime Minister’s proposal to have a general election in six weeks’ time, to ensure certainty, clarity and security for the period of the Brexit negotiations, is different from a proposal to have a disruptive referendum campaign during the period of those negotiations.

Common commercial policies for the UK to pursue as we leave the EU, for example in animal health and food safety, are as essential to Scotland as they are to Somerset. How can the JMC help to ensure that they will be adopted?

I would certainly hope that the JMC(EN) will be involved in the discussion on the repatriation of important powers from the EU to the Scottish Parliament and the other devolved Administrations. I recognise more than anyone how important it is to have common animal welfare arrangements, as the main livestock market for my constituency is a mile south of the Scottish border in England.

Scotland voted to remain in the EU and the single market, but the Scottish Government’s paper that would have kept Scotland in the single market and the UK was roundly ignored by a Tory UK Government intent on pursuing a reckless hard Brexit. Will the Secretary of State tell us what personal action he took to convince the Prime Minister to take account of the views of the people of Scotland, and can he provide an explanation for why he failed?

I have been clear that “Scotland’s Place in Europe” did play an important part in the Government’s thinking—[Interruption.] Just so that the hecklers on the Opposition Benches are clear, the Government formally responded to the Scottish Government in relation to “Scotland’s Place in Europe”. Surprisingly, the Scottish Government asked us not to publish our response.

In the Secretary of State’s assessment of the effectiveness of the Joint Ministerial Committee, did he share my conclusion that it would be much more effective if all parties were focused on building a strong UK after Brexit, not separatist agendas?

As we head into unprecedented peacetime negotiations with the EU, it is vital that all parts of the United Kingdom pull together to take a Team UK approach. By doing so, we will get the best possible deal for Scotland and the whole UK.

The JMC is supposed to be the platform through which the devolved Administrations have their voices not just heard but responded to. The Secretary of State paints a rosy picture, but he is not listening to those voices. Northern Ireland voices are not being heard at the moment, because they are not allowed to attend. From what we have heard this morning, the Scots are saying clearly that their voice is being ignored. The Welsh feel, at best, less than impressed. Will the Government give this body the teeth it needs, put it on a statutory footing and let it do its job properly?

The purpose of the JMC is to bring together the UK Government and the devolved Administrations, and to work together to formulate our position as we go forward in the negotiations. I very much regret the fact that the Northern Ireland Executive have not been able to be politically present in recent times—we all want that situation to be brought to a conclusion—but the meetings have been robust and, I believe, certainly in terms of the actions that have flowed from them, constructive.


The UK and Scottish Governments continue to engage closely on the devolution of new tax powers. The Scottish Government are now responsible for setting the rates and thresholds of income tax. It is of course incumbent on them to use their powers to make Scotland an attractive place to live and work.

Now that the Scottish Government have unprecedented power to shape the economy of Scotland, will my right hon. Friend join me in calling on the Scottish National party to start delivering jobs and economic growth in Scotland, rather than focusing on a second independence referendum? [Interruption.]

The shouts from Opposition Members just highlight the complacency of the SNP in relation to the Scottish economy, which contracted by 2% in the fourth quarter of 2016 while the UK economy grew by 0.7%. No Scot can be proud of that comparison.

Does my right hon. Friend agree that it is terrible that middle earners in Scotland are being penalised £400 this year by the Scottish Government, and by up to £1,400 by 2020-21, compared with England, where we have higher tax thresholds to help hard-working families?

My hon. Friend is right to highlight that point. I might not like the plans to make Scotland the most taxed part of the United Kingdom, but I acknowledge that that is a matter for the Scottish Government. They will have to account for their taxation policies, and the forthcoming general election will no doubt highlight these issues.

The average band D council tax bill in Scotland is almost £400 lower than it is in England. Will the Secretary of State’s discussions consider how local authorities in England can learn from Scotland’s successes in providing local and national services while maintaining the lowest council tax rate in the UK?

The hon. Lady may have spoken to the SNP press office, but she certainly has not spoken to councils throughout Scotland, which are uniform in their negativity in respect of the Scottish Government’s approach to local government funding.

As a last act of kindness, and while he still has his seat and his position, will the Secretary of State address the closure of the Her Majesty’s Revenue and Customs office in my constituency, which threatens 1,000 job losses and a move to Edinburgh? A cross-party group of politicians, including members of his own party, has written to him, but he has ignored that. As his swansong, will he come to Livingston and save those jobs?

As the hon. Lady knows, I have set out clearly, in correspondence with all who have been in touch with me, the rationale for the move and the changes in the arrangements for HMRC. Many of those changes were called for by Members on both sides of the House on the grounds of efficiency and effectiveness, but obviously no Members like to see significant changes in employment patterns in their constituencies, and I commend the hon. Lady for the way in which she has pursued the issue.

Leaving the EU: Private Sector

5. What discussions he has had with Scottish businesses on opportunities for the private sector after the UK leaves the EU. (909645)

7. What discussions he has had with Scottish businesses on opportunities for the private sector after the UK leaves the EU. (909647)

The UK Government’s plan for Britain is intended to help businesses throughout the United Kingdom to trade beyond Europe, and to make Britain a leading advocate for free trade all over the world. Scotland Office Ministers have held more than 70 meetings with businesses across Scotland since last summer’s referendum, and only last month my right hon. Friend the Secretary of State for International Trade was in Glasgow to meet innovative Scottish businesses that are trading with the world.

What steps is my right hon. Friend taking to support international trade and investment in the devolved nations?

We in the Department for International Trade are clear about the fact that ours is a Department for the whole United Kingdom. All our services are accessible to companies in Scotland, England, Wales and Northern Ireland, including the GREAT campaign and its portal, and the Tradeshow Access Programme. In recent months, there have been major announcements about more overseas investment in all parts of the UK.

Will my right hon. Friend tell us his view of the damage that would be caused to Scottish business if Scotland left the United Kingdom?

My hon. Friend has hit the nail on the head. If Scotland were to leave the UK, the potential damage to Scottish business and Scottish trade would be huge. The Scottish Government’s own figures show that 64% of goods and services leaving Scotland go to the UK, whereas only 15% go to the rest of the EU. That is £49.8 billion versus £12.3 billion.

I think the hon. Gentleman is missing the point. The point, surely, is the centrality and importance of the UK single market as we go forward from here. I will give the House the figures again: £49.8 billion goes to the rest of the UK; only £12.3 billion goes to the EU. It is clear that the Union that matters most is the United Kingdom.

The Secretary of State has said previously that he supports the European single market and that being part of the single market is clearly the best possible deal for Scotland. Will he tell his constituents whether he will now stand on a manifesto to take Scotland out of that single market?

The Prime Minister and the whole Government are absolutely clear about the fact that our objective is to secure a comprehensive free trade agreement with the European Union as we leave the EU. That will be in the best interests of all parts of the UK, including Scotland.

What assessment has my right hon. Friend made of the opportunities for increasing whisky exports across the world as part of a free trade agreement once we leave the European Union? [Interruption.]

My hon. Friend raises a very important point. Whisky is a vital part of our export mix: whisky exports reached £3.999 billion in 2016—a big increase—and whisky has been at the heart of quite a few of our trade missions. Notably, when the Secretary of State for International Trade, the Prime Minister and I visited India in November, we took with us the Scotch Whisky Association, and we have seen big increases in exports to India.

Former Prime Minister David Cameron promised he would not resign if he lost the EU referendum; he reneged on that promise within hours. The current Prime Minister said on seven occasions that she would not call an early election; she reneged on that promise yesterday. Will the Minister, answering on behalf of the Secretary of State, give him the chance to break the mould and renew the commitment given to this House on at least three occasions that whatever support is put in place for businesses in the north-east like Nissan will be put in place for Scotland?

We have been absolutely clear that our support for Nissan and the rest of the automotive sector will be enduring. That is the most important point, and I am sure it will be an important point in the general election campaign. I look forward to the Conservatives being competitive in the north-east in this coming general election, and we look forward to taking the fight to the official Opposition there.

The question was whether the Secretary of State will renew the promise given to Scotland that it would have the same deal, and, if he will, will he tell the people in the oil and gas supply chain, given the report from Robert Gordon University which last week found that Brexit would cost them £200 million, that that money will be sorted and they will be looked after in the same way as Nissan—or will he ignore that and break another promise?

I am certainly glad that the hon. Gentleman has raised the question of oil and gas in Scotland: I know that he and I will agree that what would be most disastrous for the Scottish economy, including the oil and gas sector, would be Scottish separation, leading to an overnight budget deficit of around 9% of GDP. That would be a disaster.

UK Single Market

Sales from Scotland to the rest of the UK are now worth nearly £50 billion, an increase of over 70% since 2002 and four times the value of exports from Scotland to the EU. There is no doubt that the United Kingdom is the vital Union for Scotland.

Does my right hon. Friend agree that the best deal for Scotland is to stay part of the United Kingdom and to work with the UK Government to do all it can to support a new free trade agreement with the EU?

The International Monetary Fund predicted dire consequences for the UK economy if we voted Brexit, yet it upgraded our growth yesterday, for the second time in three months, to 2%. Much of the confidence about the growth in the UK economy is deserved under the leadership of our Prime Minister. Does my right hon. Friend agree that when people look to buy British, as a quality marque “made in Scotland” is very important?

My constituency has a long and proud tradition of textile companies, many of which trade with all parts of the United Kingdom. How will those companies be helped by Scotland leaving the hugely successful UK single market?

Obviously, they will not, because, as my hon. Friend will know, in 2015 Scotland exported £49.8 billion to the rest of the UK, four times more than exports to the EU and three times greater than sales to the rest of the world.

The benefits to Scotland of full access to the UK market are clear. Does my right hon. Friend agree that Scottish representation in this Parliament must focus on what benefits the whole of the UK single market?

Absolutely. That is why I can confirm to my hon. Friend that when Ruth Davidson and the Scottish Conservatives go into the general election, it will be on the basis of keeping Scotland at the heart of our United Kingdom.

12. Seventy-five per cent. of Canada’s exports go to the US, whereas only 63% of Scotland’s exports go to the rest of the UK. Canada is a successful, independent country. Does the Secretary of State agree that neighbouring countries can have close trading relations while still maintaining their sovereignty? (909652)

Of course countries can have close trading relationships, but Scotland benefits from being part of the United Kingdom because there are no barriers to trade, and there is freedom of movement between Scotland and the rest of the UK. That is good for Scottish business and the hon. Lady should support it.

15. The value of Scottish exports of food and drink has doubled in the past 10 years, to £5.5 billion in 2016. This week, the chief executive of Scotland Food and Drink, James Withers, said that he was afraid that the consequences of leaving the European Union without a trade deal would result in tariffs. Can the Secretary of State guarantee that the Scottish food and drink sector will not have to deal with such a situation? (909655)

From my discussions with the Scottish food and drink industry, I understand that its greatest concern is that the Scottish National party would seek to drag Scotland out of the United Kingdom.

Does the Secretary of State stand by his comments last year, when he said:

“My role is to ensure Scotland gets the best possible deal and that deal involves clearly being part of the single market”?

Will he be honest with his constituents in a few weeks’ time? Will they be voting for an MP who supports being in the single market, or for one who wants to go along with a damaging hard Brexit, whatever the cost to families and businesses in his constituency?

When I contest my constituency in the next general election, I look forward to knowing exactly what the SNP position is on the EU. Is it for taking Scotland back into the EU, or is it not? I hope we will find out in the next six weeks.

The Tories’ strategy worked a treat against the Liberal Democrats in the south-west of England at the last election. Will the Secretary of State be urging his colleagues to export that strategy to Scotland in the coming election?

Ruth Davidson has already made it absolutely clear that her stance in the forthcoming general election will be to stand up for Scotland’s membership of the United Kingdom and against a divisive second independence referendum.