Jackie Baillie: Now we can see the true cost of NPD
Shadow Economy spokesperson Jackie Baillie takes a look at the shocking level of offshore private finance in Scottish public contracts.
£11 billion each and every year - that’s what we spend on procuring goods and services for the public sector in Scotland. Everything from hospitals and new schools to improving our roads infrastructure and building bridges.
Scottish Labour has long advocated that procurement can help grow the economy, both by maximising supply chain benefits and enabling local businesses to win contracts, which directly benefits local economies. Procurement is also a route for securing improved workers’ rights and, most notably, Scottish Labour tried to get a requirement to pay the real living wage on the face of the Procurement Act, something which the SNP voted against 5 times.
So well planned procurement can be good for our economy, but how we do that and what funding models we use has been hotly contested. The SNP established the Scottish Futures Trust promising an end to the increasing levels of private profit in public sector contracts. The truth is their much vaunted Non-Profit Distributing model, is a variant of PFI/PPP, profits are distributed, debts are sold on the secondary market and profits are anything but capped.
The SNP’s approach has however reached new heights of hypocrisy this week with the staggering revelations that 60% of SFT funded projects have shareholders or operators with links to tax havens including Jersey, Guernsey, Cayman Islands, the Virgin Islands, Luxembourg and Cyprus; 20% of the equity in NPD and Hub companies is owned offshore; and disappointingly, only 17% of the value of these projects is retained in Scotland. It looks like everyone, but Scotland, seems to be profiting from our infrastructure investment.
The SNP has form on this. Remember Alex Salmond and Humza Yousef’s shopping trip to Qatar. Sweeping aside any discussion about their questionable human rights record, entrenched discrimination against women, and ban on trade unions, the SNP were content to make deals to sell off projects. Schools, hospitals, motorways – provided the price is right they didn’t care who owned Scotland.
And then there was the £10 billion Chinese deal with Sinofortune and the China No 3 Engineering Group that never happened – this was to be investment in major infrastructure we were told. Later we discovered that the Norwegian oil fund had refused to work with them because of the accusations of corruption. But that didn’t stop the SNP from trying to do deals with them or with Qatar. It seems the preferred way of funding infrastructure investment in Scotland is to sell to off shore and in some cases dubious companies.
That’s why the SNP’s Growth Commission, which promoted the idea of our economy being over dependent on overseas board rooms and volatile foreign direct investment, should really have come as no surprise.
The SNP used to argue over value for money, now all they care about is selling off Scotland to the highest bidder and they are not too choosy about who they get in to bed with.
Yet again the SNP have been caught out – they say one thing on the campaign trail and behave differently in private.