28 October 2010

S3M-7269 Renewable Energy [Opening Speech]

Scottish Parliament

Thursday 28 October 2010

[The Presiding Officer opened the meeting at 09:15]
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Renewable Energy

The Deputy Presiding Officer (Alasdair Morgan): The next item of business is a debate on motion S3M-7269, in the name of Liam McArthur, on renewable energy.

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The Minister for Transport, Infrastructure and Climate Change (Stewart Stevenson):

Many of us are very grateful to Liam McArthur for raising this subject. The debate gives us the opportunity to hold the UK Government's proposal on the use of the fossil fuel levy up to the light. When we do that, it is impossible not to notice the serious loopholes and fundamental flaws that riddle what is apparently a generous offer.

Mr McArthur has suggested that there is a division between the First Minister and the Cabinet Secretary for Finance and Sustainable Growth. I assure him that there is not. The division on the matter is between the proposals that have now been put forward by Liberal Democrats and their manifesto, which on page 74 speaks about

"a one-off payment in the 2011 budget."

They said that they would

"give control of future revenues to the Scottish Government. This will likely lead to an increase in resources for Scotland of around £250 million in 2011-12."

That offer is very distant from that which is now before us, which would mean having a three-year period during which we are denied access to the money in any meaningful way. It is our money, as a Parliament; it is our money, here in Scotland.

I hope that I can reassure Liam McArthur that we are fully engaged on the Skykon issue. There will be a meeting today involving Scottish Enterprise and Skykon.

If we postpone the money until 2013, it will be utterly irrelevant to the issues that are faced by companies, which have needs today. That is very different from the proposition that is before us. I hope that, by the close of the debate, Liam McArthur will also be able to see that; that is, assuming that he cannot see the flaws already, and is instead choosing to draw a veil over them.

Let me restate the basics of the situation. The fossil fuel levy surplus, which is money that has been raised from renewables projects in Scotland, as funded by Scots consumers, sits at £190 million. Liam McArthur might, of course, wish to amend his motion in that respect. Indeed, in only nine days, he has resiled from a figure of £500 million, which is referred to as being fossil fuel levy money in the Liberals' press release of 20 October.

By statute, the money can be spent only on promoting renewable energy in Scotland. The money simply cannot be drawn down and spent for that purpose, however, unless the Treasury allows it to be added to the Scottish block spending limit—something that it has repeatedly failed to do. I acknowledge that, at the end of his term in office, the outgoing Chancellor of the Exchequer showed signs of movement on that issue, and we welcome that.

The motion, in common with the UK Government's offer, pivots on the risible proposition around the interpretation of "additional". Let us be absolutely clear: the offer from the UK Government, which has found such uncritical support on the Scottish Liberal Democrat benches, does not change the position of the previous UK Administration by one iota. In effect, the UK Government is saying that if we draw down our fossil fuel levy money and use it for our planned renewables expenditure during the next few years, it will use its corresponding savings—from reducing the Scottish block accordingly—to add to the green investment bank, which is not directly under the control of the Scottish ministers or the Scottish Parliament.

Gavin Brown (Lothians) (Con): How does the minister explain the enormous gulf in tone between what his Government is saying and what all the Scottish business organisations and Scottish Renewables are saying about the announcement?

Stewart Stevenson: Gavin Brown should be very careful in ascribing to business and Scottish Renewables support for the proposition that is before the Parliament. It is clear that there is significant concern about the timing of access to the money. We should have access to the money right now. By 2013, many of the key opportunities for the renewables industry in Scotland will have passed us by. That is key—

Gavin Brown: What about the Scottish Investment Bank?

Stewart Stevenson: There is a debate for members of Gavin Brown's party to have and I hope that they will address the issues.

We might see funds in three or four years' time. That does not help us with our immediate needs and opportunities. The green investment bank will fall far short of the minimum of £4 billion to £6 billion that is demanded by the renewables industry, which would have been expected already to have delivered major investments and benefits for Scotland's renewable and low-carbon sector.

It is absolutely unclear to me why anyone who is outside Liam McArthur's narrow circle should find the offer welcome. It is also hard for me to reconcile the member's enthusiastic welcome for an offer that takes money away from the Scottish Parliament and the renewables sector with the aim that the Scottish Liberal Democrats set out in their manifesto this year, which was that the release of the money would

"lead to an increase in resources for Scotland of around £250 million in 2011-12."

That is the commitment to which Liam McArthur signed up, but how it has changed since his colleagues took their places in the new UK Government. It has unravelled, to the extent that Liam McArthur's motion hails as generous an offer that takes vital resources away from the Scottish Government and the Scottish Parliament and away from the needs of the renewables industry.

The offer that is before us is not in Scotland's interests. We have expressed serious reservations and we asked for urgent clarification on vital aspects, but our questions have not yet been answered. The offer is a chimera; it is a conjuring trick, it is a con and it is a sleight of hand, which takes money that was raised in Scotland and locks it away to meet an existing UK Government commitment at some unspecified, but probably distant, future point. Rather than welcome such an offer, we, along with others who share our interest in the matter, will continue to fight for Scotland's interests.

I move amendment S3M-7269.1, to leave out from "welcomes" to end and insert:

"notes Scotland's massive renewable energy resources and the opportunities to turn Scotland into Europe's clean green energy powerhouse; notes the UK Government's proposals that would result in Scotland's Fossil Fuel Levy fund helping to form part of a wider UK green investment bank fund that is due to be established in 2013-14; notes the lack of detail underlying that commitment and the risk that this could delay vital funding for the renewables sector in Scotland for several years, and calls urgently on the UK Government to release these funds and place them in the control of the Scottish Government and Scottish Parliament in a way that can be rapidly deployed to support Scotland's renewable energy sector."


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