Ivan McKee MSP: Green Freeports will help build a more prosperous economy
A partnership agreement to establish two Green Freeports in Scotland has been reached between Scottish and UK Ministers. Scottish Government Business Minister Ivan McKee writes that the deal recognises the distinct needs of Scotland's economy and enshrines the Scottish Government's commitment to achieving net zero emissions and embedding fair work practices through public investment.
Freeports globally have, it is fair to say, a mixed reputation. While they can stimulate investment and trade there have also been examples of them operating as hubs for illicit activity and lowering labour and environmental standards. That is an outcome the Scottish Government is determined to avoid. That is why, in reaching agreement with the UK Government, we have adapted the UK's Freeport model to meet the needs of Scotland's economy, fully reflecting our net zero and fair work ambitions.
Our focus is on creating clusters of internationally competitive manufacturing excellence around the industries of the future. Our interest is in high technology, high innovation, high wage manufacturing, not in a race to the bottom. Scotland has world beating technology and opportunities, particularly in the offshore renewable energy sector. We see Green Ports as a mechanism to attract further investment into the sector and to strengthen local supply chains creating good green jobs, all as part of our just transition to a net-zero and climate resilient Scotland.
Scotland leads the UK in the race to net zero. Last year the equivalent of 98.6 per cent of Scotland's electricity was generated from renewables. We have legally binding targets to deliver net zero by 2045, and the recent Scotwind offshore leasing round has the potential to generate 25GW of electricity – this capacity of offshore wind would have the potential to generate over double Scotland's current electricity consumption levels.
Scotland also takes the fair work agenda seriously. We are already rolling out requirements for all businesses in receipt of Scottish Government grants or tax reliefs to pay at least the real living wage to tackle low pay and help eradicate poverty. Scotland already has 2,300 businesses registered as real living wage employers. That number is increasing daily, and Green Ports will help accelerate that trend.
It is no surprise therefore that net zero and fair work are essential elements of the distinctive Scottish Green Ports model. Embedding fair work is of pivotal importance for the Scottish Government.
Anyone who visited COP26 in Glasgow last year and spoke with global investors will be very clear about the vast potential to attract mobile private sector capital investment to the right net zero opportunities. We see Green Ports as a well-positioned vehicle to attract that investment to opportunities that have clear documented plans to deliver net zero, and where there is government support over the long term. The perfect recipe to deliver the market signals and stability that investors seek. Scotland is consistently the best performing part of the UK outside of London in attracting foreign direct investment, and punches above its weight in attracting environmental, social and net zero investment. Green Ports give us a further opportunity to cement that position.
Our deal with the UK Government ensures an equal say for both governments in the selection and monitoring of Scotland's Green Ports. This is the correct approach as both governments will be providing tax reliefs and financial support through devolved and reserved mechanisms – the Scottish Government through investment support on Non Domestic Rates and Land and Building Transaction Tax (the equivalent of UK Government Stamp Duty).
Scotland's enterprise agencies will also stand behind Green Port businesses with development support and advice.
This agreement respects the devolution settlement, and ensures that UK Government investment into Scotland – including the £52 million set-up costs for the Green Ports – is aligned with Scottish Government priorities. The deal also ensures equivalent set-up funding from the UK Government for ports in Scotland and England.
This is a partnership demonstrating the influence and value of devolved government.
A partnership with shared determination to ensure the highest standards of fair work practice.
This is also, critically, a partnership with the businesses working in Green Ports.
To secure the benefits on offer we will require applicants for Green Port status to show how they will contribute towards Scotland reaching net zero by 2045. They will have to set out how they will create new high-quality, well-paid employment opportunities, with fair work at their heart, including payment of the real living wage and fostering wider adoption of fair work practices by businesses in the area.
Nobody will be left behind as we build Scotland's sustainable economy.
We can only seize Scotland's economic potential if we create secure, sustainable and satisfying jobs that help build a fairer, more prosperous economy for everyone. That is a Scottish Government priority and establishing Green Ports in Scotland, with the vital changes the Scottish Government has secured, will help achieve this.
