Scotland: Economic Recovery and Renewal

Baroness Davidson of Lundin Links Excerpts

Thursday 9th December 2021 Lords Chamber

[Baroness Davidson of Lundin Links (Con)]

My Lords, I congratulate my noble friend Lady Fraser on securing today’s debate and for having the foresight to schedule it on budget day in Holyrood.

An economic debate is usually all about the numbers, but before I get to them, I will spend a short time talking about language, because language matters. Too often I feel that those of us who support the continuation of our United Kingdom are at risk of doing the Scottish nationalists’ job for them by talking about Scotland in a way that separates us from that of which we wish to remain a part. This happens, for example, where we compare facts or figures, spending or investment, hospital waiting times or educational attainment, where Scotland is reduced to a comparator of our neighbouring nations, not a member of the wider whole. From there, it seems to me that, it is only a short hop from defining ourselves as a counterpoint to our opponents’ preferred framing, where they define the United Kingdom as some kind of imposition, something that is done to Scotland, rather than the simple truth that the establishment of the United Kingdom and its development down the centuries is something that Scots not just participated in but helped build and that we had and continue to have ownership over. It is our union too.

I also feel that, when we are discussing the nuts and bolts, particularly of the economic relationship—whether that is examining the balance of trade or pointing out that rUK is by far Scotland’s biggest and most important market—we must not forget that British companies do not divide themselves at Berwick or Carlisle. Their offices, factories, distribution chains and retail outlets are dotted all over these islands, and neither the Treasury nor the Scottish Fiscal Commission can or should seek to box them into just one geographically defined column on a balance sheet.

I am as guilty of falling into the trap of talking about Scotland comparatively as any; it is easy to do. Vigilance against it is why I am so appreciative of the manner in which my noble friend Lady Fraser defined today’s debate, with its focus on the contribution to the recovery of the whole of the UK and looking at that not as a metric and measure simply of itself but examining how that economic recovery can impact and improve well-being and quality of life.

I am unashamedly a pro-business Tory. I believe, yes, that hard work, endeavour, production and earning, and providing for one’s family are good for the individual, for health, self-esteem, freedom, increased choice and agency. However, I also believe that what work does for the individual, business does for the country. A healthy economy gives us the funds and levers to improve public policy and grants greater influence in an ever more integrated world to be able to shape improvements on a global scale. It is a virtuous circle.

That is why I despair when I see people—even those of my own party—dismissing business or disrespecting the herculean efforts that people have gone to, especially in the last two years, to look after their staff, do well by them, keep the show on the road, survive and fight back. We know that it is all interconnected. A feeble economy, suppressed earnings and high levels of unemployment increase poverty, and poverty, particularly intergenerational poverty, impacts enormously on health outcomes, educational outcomes, employment outcomes and future earnings. As businesses are being asked once again to send workers home, it is more important than ever that this Government and all the devolved Governments and Administrations work together to support firms back to health.

No Government, particularly not a Conservative one, would seek to tell companies how or whether to operate, nor welcome the sustained taxpayer subsidy of profit-making industries. Yet, in the extraordinary times we find ourselves in, this Government have mobilised to do both, to keep people safe and protect the economy. I for one am proud that my Government made the decision to invest £400 billion in British business, protect more than 14.5 million jobs and make over £100 billion in business grants and loans available to ensure that fundamentally sound companies that would not otherwise have made it survived. Within that envelope, we see 910,000 Scottish jobs protected through the furlough scheme and 100,000 Scottish businesses supported through UK Government loans.

Supporting both the labour market and the companies that sustain it has been so important. It is one of the reasons why the UK has the fastest rate of economic growth in the G7. It is why we see record job vacancies across the country as firms are able to bounce back. Yet both the UK and Scottish economies still find themselves 2.1% smaller than in the last quarter before the pandemic struck, so there is work to do. Scotland’s whisky producers, food manufacturers, financial service providers, farmers, hoteliers, truck drivers, shops, bars and restaurants will be every bit as key to this recovery as Midlands garment makers, Yorkshire farmers, Welsh agribusiness, Northern Irish tourism operators, Essex bank workers or Mancunian nightclub owners.

I would like to say a word about the recognition on the part of businesses that their responsibilities go far beyond the bottom line and further still than looking after their own workforce, to contributing to their home communities. When Covid struck, I was still an MSP, representing a city-centre constituency. I know from my own experience of businesses that dipped into their own pocket to support their staff while they waited for government help to kick into gear. I know of companies that dedicated time, product lines and personnel to help with the volunteering effort, to ensure the vulnerable and clinically vulnerable were okay. I know of firms which were not content to just clap NHS workers once a week, but supported them directly with transportation, discounting or food. I know—well—one gin distiller who immediately switched production, using his white spirit to make hand sanitiser to donate to charities and not-for-profits around the city, so they could carry on their important work at the very beginning of the pandemic when sanitiser was short. It was a superb effort—especially as the one thing the rest of us needed when Covid struck was gin.

This is why I so appreciate what this Motion attempts to convey. There is an enormous recovery under way, and Scotland, its companies, its people and its resources are playing a full part in that recovery effort. They do so not because a healthy economy is an end in itself but because it is that healthy economic recovery which will support hospitals everywhere, including in Scotland, to start tackling the treatment backlog, and because it is a strong economy which will underpin educational investment, training the next generation of research scientists so that any new vaccines are as likely to come from Edinburgh or Glasgow as they are from Oxford.

It is only through a healthy economy that we can support the thing that matters most of all: giving people the belief and opportunity to ensure that their children have a better quality of life than they did.