Between a rock and a hard place

Vince Mills

IN DECEMBER LAST YEAR THE LABOUR LED SCOTTISH EXECUTIVE WAS DEFEATED by a single vote at Holyrood when MSPs considered a motion asking them to endorse the tendering of the publicly owned Calmac west coast ferry routes. The defeat was only possible because a number of Labour MSPs rebelled.

In light of the Parliament's rejection, the Liberal Democrat transport minister Tavish Scott, discussed the matter with the EU's transport commissioner, Jacques Barot, in Brussels in July. The minister told the press that Barot had insisted that Calmac had to go out to tender. Not everyone, especially the unions fighting the tendering process were convinced that Scott's understanding of the EU rules was a black and white as he suggested. Through MEP Catherine Stilher, they organised their own meeting with Barot for September 27th in Strasbourg.

The STUC and Calmac Unions argued that the Scottish Parliament should take no action on Tavish Scott's report until after the STUC led delegation of Calmac trade union representatives met with Commissioner Barot. The unions planned to tell Barot that tendering will be detrimental both to the workforce and to the island communities and that it will cost the Scottish taxpayer dear.

The unions' case was strengthened by the work of Jeanette Findlay of Glasgow University. In a submission to the Scottish Parliament's Local Government and Transport Committee she strongly supported the status quo. She argued that cost savings are achieved by privatisation at the expense of staff wages and conditions, and have involved reductions in the quality of service. The committee has yet to conclude its work on the tendering issue.

The unions also wanted proper consideration of the Altmark judgement of the European Court of Justice which states that compensation for the provision of services of general interest does not amount to state aid. It specifically refers to compensation payments for air and maritime transport to islands.

Consequently the STUC wrote to Scott and asked that no decision be taken by the Scottish Parliament until the Local Government and
spoke in argued that the tendering process was an extremely bad idea and then proceeded to vote with the Executive in supporting its introduction, on the grounds that the EU Commission might take action against the Executive.

Even the Minister Tavish Scott confessed to bewilderment about the intent of EU Transport Committee had the opportunity to finalise their work; the Calmac trade unions had met with Commissioner Barot; and the implications for Calmac of new guidance on state aids following Altmark had been clarified.

All to no avail. On September 14th the Scottish Parliament had the debate on the tendering process. It was a bizarre spectacle. Most of the Labour MSPs who regulations. In his introductory remarks he said: 'I must say that, even in my most rational and objective moments, I struggle at times to cope with European Commission rules against a criterion of consistency; particularly in respect of remote and peripheral areas. I can genuinely understand Members' difficulties in making sense of what are extremely complex rules, which-on the surface, at least, and sometimes, I believe, more deeply-appear to be self-ontradictory. '

This was followed by a number of labour MSPs signing up to the notion that there was nothing to be gained in resisting or questioning EU regulation. Maureen Macmillan the labour MSP for Highlands and Islands, for example: 'I agree that we do not want to tender and that we must do our utmost to protect the workforce's pay; conditions and pensions. We must focus on that and write such requirements into the tendering documents and the specification. I hope that the Minister's recent talks with the STUC have resolved some of the issues. We need a very robust section to be included in the tendering documents and specification underlining commitment to human resources. Proper engagement and consultation with the workforce by the company; whether Calmac or another; is paramount.'

This rather ignores two obvious objections. The first is that if you already have decent pay and conditions of service for the ferry workers why go the bother of having to specify these in great detail in a tender document. And more to the point what about the enormous cost of tendering, no doubt to be funded by the taxpayer.

This last point was not lost on labour's Des McNulty MSP for Clydebank and Milngavie: 'There is consensus throughout the Parliament that it would be better not to have to go down the tendering route. Some valid points have been raised about the extra cost that it is anticipated tendering will produce. There are also points that have not been raised about the freezing of the service in Calmac as a result of our going down the tendering route. That denies flexibility and reform in the usual way, which I hope would improve services from the point of view not only of the workers but of the consumers of services. Tendering, which implies inflexibility in the system, is a barrier to that negotiation and flexibility.'

Unfortunately Des like the other labour MSPs did not use his vote to challenge the Executive's decision. The executive won its position by 63 votes to 53 with one abstention, a Liberal Democrat.

The fight is not over, however. Had the Scottish Parliament voted on the basis that it thought tendering was a good thing, then it would be fair to say that whether we liked it or not, the Scottish Parliament had expressed a position for which it was accountable to its electorate. But it did not. The MSPs clearly argued that they were taking this decision under threat of legal action from Europe, not because they agreed with it.

Glasgow Central CLP decided, therefore to take the argument to the UK Party since it is the Westminster Government that speaks as the Member State and not Scotland's devolved government and it is the Westminster Government that has the right to challenge this iniquitous decision.
Glasgow Central has put down the following contemporary motion for labour Party Conference. Please give it as much support as possible:
'This Conference notes the decision by the Scottish Parliament on September 14th 2005 to allow the publicly owned Calmac ferry companies' routes to be put out to tender. Conference accepts that many labour MSPs only voted for this measure under duress, because they believed that if they did not, the European Commission could order the immediate cessation of subsidy to Calmac and order the Scottish Executive to recover from Calmac all subsidy that had been declared to be illegal state aid.

In the words of one labour MSP who spoke during the debate "I agree with those who say tendering is not cost effective but the Commission does not care about cost effectiveness, it only cares about competition for the subsidy."

In light of this conference supports the continued campaign being waged by the STUC and the trade unions in Scotland against tendering and calls on the Westminster Government to challenge this interpretation of EU rules, if necessary, through the European Court of Justice.'