By Ian Fraser
Published: Sunday Herald
Date: 29 October 2000
ALEX NEIL certainly has the vital credentials for his new job – but that’s no guarantee Scotland is in for any backslapping, consensual politics.
Neil is the convener of the powerful enterprise and lifelong learning committee and expects to be working alongside new Scottish Executive minister Wendy Alexander from this week. The previous double act of Henry McLeish and John Swinney were lauded for their co-operative bonhomie. Now we face a different landscape.
Neil, a list MSP for central Scotland, is often viewed as a nationalist firebrand with left-wing views. Yet, ironically, he is one of the few MSPs with external business experience – he used to run his own economics consultancy with an international perspective on Europe’s emerging economies. He is expected to be wedged between two formidable female politicians: Alexander, also a former business consultant for whom his committee will act as a bellwether, and Annabel Goldie, the deputy leader of Scottish Tories and deputy convener of the committee.
Neil already has some far-sighted views as to what the committee should be doing to ensure it can genuinely help business in Scotland. In view of the consensual approach which the committee is expected to maintain, he stresses however that that these are “my personal points of view”. First, Neil would like to ensure the committee is not blinded by the daily drudge – although it will retain its “bread and butter” role of scrutinising legislation and handling inquiries into large-scale government cock-ups such as the Scottish Qualification Authority Higher results fiasco. But he would also like it to look as far ahead as 2020 at the key strategic issues that will face the Scottish economy in order to add as much value as it can. “Malaysia has a 2020 vision and its high time Scotland had a 2020 vision.”
Neil intends to take the committee on an away-day during which it will solicit ideas from people from beyond the parliament, including representatives of organisations such as the Confederation of British Industry and the Federation of Small Businesses. “We want to ask them where the committee can add the greatest value and make its greatest impact in the debate about the future of the Scottish economy. This means getting to grips with key issues that other organisations haven’t addressed or where awareness needs to be raised, and where there needs to be some agreed strategy on the way forward.”
One area that clearly worries Neil is depopulation. He predicts Scotland’s population of 5.2m will dip under five million within the next 30 years. By contrast, south-east England experienced net immigration of around 300,000 to 400,000 last year. “Apart from Italy, Scotland is the only country in Europe which is forecast to have a substantial drop in its population over the next 20 years. That will have implications on two levels for the Scottish economy. If your population is declining, it threatens economic viability both in key sectors and in purchasing power.
“I’d like the committee to look at the whole issue of population change and see what can be done to keep many more of our young people, and particularly young graduates, here in Scotland. They’re the bedrock, in terms of people who start up new businesses and expand existing businesses. They’ll be the entrepreneurs and research scientists of the future. We are bleeding at the moment in terms of the loss of skills. That’s a big strategic issue that has never been properly addressed.”
Another issue which Neil feels the committee should address is the narrowness of Scotland’s economic base. “Three or four sectors – oil , whisky, IT and computer hardware – make up about 70%-80% of all our exports. One company, Motorola, makes up around 20% of Scotland’s exports. That puts the Scottish economy in a vulnerable position given that the sectors we’re talking about have their own problems in terms of global fluctuations. We need to look at how to diversify the economic base so we’re not relying so heavily on so few sectors.”
Neil adds that the Scottish economy’s competitiveness vis-a-vis international rivals is hamstrung by poor infrastructure both in terms of fibre-optic bandwidth and transport, particularly roads. “We’re mid way through an inquiry into the new economy which should be completed early in 2001. One thing I’d like to look into is how the development of e-commerce has been constrained by a lack of availability of bandwidth. Outside the central belt, we’re at a major competitive disadvantage here. It is a central infrastructural issue that needs to be tackled.”
He would also like the committee to work out which are going to be the big wealth-generating activities of the next few decades. “Nanotechnology will explode into one of the major new industries of the future. Scotland at the moment has some competitive edge in terms of research.” The basic idea of nanotechnology is that tiny machines can be engineered at the level of individual atoms and molecules, and then be given tasks such as eating pollution, generating electricity from sunlight, or even travelling through blood to repair damaged human tissue. The sector could transform both engineering and medicine.
Neil says: “How do we take that forward to make sure we maintain our lead? We’ve got to invest now and invest heavily. What I would like to see is the same public-private-academic tri-partnerships as you get in the high-tech hotspots of the States. Unless this happens, Neil fears that nanotechnology will end up like a lot of other technologies: as with Logie Baird’s television set, Scotland does the pioneering research but loses out when it comes to manufacturing, jobs and wealth creation.
As a Scottish nationalist and the man behind the SNP’s controversial “Free by ’93” campaign, Neil makes no bones about his preference for seeing all governmental and macroeconomic powers under the control of the Scottish parliament. But he seems more pragmatic now and has come to terms with the fact that, for the time being at least, the macro-economic powers will remain under the control of Westminster and Whitehall. “You have to recognise that what you can do at micro level is constrained by the macro level. In other words, it is very difficult to achieve higher business start-up rates, for example, if levels of tax and interest rates are not conducive to that.”
But he adds that the committee oversees a public sector budget of £2bn, with over £1bn of that pot going to lifelong learning and the remainder going towards enterprise. Scottish Enterprise alone swallows up £460m, while Highlands and Islands Enterprise has a budget of £70m. Neil said: “Are we getting bang for our bucks with that huge amount of money? When talking about the budget next year we should be asking whether we are getting a return.”
He describes the two recent reports into the Scottish Enterprise network as ‘Phase One’. “These have achieved a broad consensus about the need to streamline the number of organisations involved in economic development and about the need for economic development forums. There’s too much confusion, too much overlap, too much duplication. Phase two is, once these forums are set up, to look at the whole economic development structure and see where structures can be improved. The aim is to make them much more effective, so we get more bang for our buck.”
He adds that Robert Crawford, chief executive of Scottish Enterprise, has “made substantial progress in a short period of time, both in terms of structural changes internally and in terms of relationships between Scottish Enterprise and the LECs. He’s made an excellent start.”
Let’s hope that Neil can do the same.