Diageo

Speech by Ross Finnie on Thu 17th Sep 2009

Diageo

The Presiding Officer (Alex Fergusson): Good morning. The first item of business is a debate on motion S3M-4862, in the name of John Swinney, on Diageo. I point out right at the start that we have no spare time whatsoever available in the debate, so I ask members to stick strictly to their speaking times.

Ross Finnie (West of Scotland) (LD): Along with other members, I marched in Kilmarnock in 1983 with shop steward Duncan McNeil against the closure of our local shipyard, which resulted in the loss of 7,500 jobs.

Much of the debate has, quite properly, been devoted to highlighting the immediacy of the problem facing Kilmarnock and Glasgow, and the very real difficulties in Levenmouth. I want to spend the few minutes that are available to me reflecting on the kind of economic debate in which we in Scotland should be a part. The Liberal Democrats make no apology for raising the issue of sustainable economic development. I will come to what that means in the context of the recent decision.

Sustainable development is not a new concept. Indeed, it would be interesting if large international firms looked up the definition that is most commonly accepted, which is in the 1987 Brundtland report. The report defines sustainable development as

"development that meets the needs of the present without compromising the ability of future generations to meet their own needs."

That concept is not new to the Liberal Democrats. The 17th century Liberal philosopher Locke wrote extensively on the responsibility of politicians to act as trustees for their communities, and on their need, as trustees, to hand on that community in the state in which they inherited it.

The aftermath of the Diageo decision, combined with the current economic recession, makes it timely for us in Scotland and in the Parliament to ask what kind of economic development we wish to promote. In the same way, we ought to be debating the kind of financial institutions and regulatory framework that we wish to support and promote.

I stress that the Liberal Democrat amendment is not an attack on Diageo per se; the point is simply that Diageo's economic model is typical of many international companies that pay scant regard to the imperative to embrace the principles of sustainable economic development. As Ted Brocklebank ably pointed out, many companies use the word "sustainable" selectively, without regard to its meaning. Sustainable economic development does not embed inefficiency. It does not prevent companies from making necessary changes. It does not stop technological progress and-regrettably, but inevitably-it does not stop redundancies taking place. However, it requires companies to view their economic progress as being inextricably linked with the attendant social and environmental costs. Taking that approach would effect a sea change in the way in which we approach the current situation.

Diageo and its like see those issues as something apart-someone else's problem. "We want to dump two plants and two workforces and move on. So what?"

Nigel Don (North East Scotland) (SNP): The approach that the member has just laid out is not the way in which a company is expected to operate if it is worried about its balance sheet. Does the member accept that such an approach would require a fundamental change to our accounting principles?

Ross Finnie: I am just coming to that. I am trying to inject into the debate a sense that we need to have such a rethink, because the problem could keep occurring. Derek Brownlee made a number of valid points about having to deal with today on its own terms. Nigel Don is right-unless we change how we measure progress, we will have problems. The Diageo response is redolent of the type of thinking that has resulted in the current rate of consumption, which means that we require three planets, when I think that everyone in the chamber knows that we have only one.

I have no difficulty in accepting that the Kilmarnock plant is not as efficient as it might be, but the decision on how to make it efficient could have been based on a sustainable model. To go back to Ted Brocklebank's point, in Diageo's assessment, the plant is not-in its words-sustainable. However, as was intimated by Nigel Don, the accountants and those who measured the company's plan took no account of the social and environmental costs. Inevitably, they came to a totally different conclusion. I understand that those members who represent the most-affected constituencies do not immediately wish to engage in a long-term debate, but I hope that the Liberal Democrats' contribution today sets out that there is a need for a fundamental rethink. As other members have stated, this kind of problem recurs, and unless there is a fundamental change in our thinking, there will be no change. I commend the Liberal Democrat amendment.