Call for "Rebate" from the Commission by Tavish Scott MSP

In my submission to the Parliament on its ferry inquiry April 2008, I said

It is easy to say that ministers are ultimately accountable, but those decisions by ministers that I have criticised were taken by them in the context of legal advice given to them. Even if they had reservations about that advice, if they acted against that advice it could have exposed them as personally liable. In that sense, ministers may have been far less free to take decisions in the public interest than appeared to be the case looking from the outside. And there is no evidence I know of that policymakers were doing anything other than trying to pursue the public interest here, irrespective of any justified criticism that could be made of individual decisions they took.

That was an attempt to allow us to look ahead rather than get bogged down in recriminations as to who is responsible for the present mess that has led to a formal investigation by the European Commission here. I have to say that I had one particular former Minister in mind when I said that, and that was Tavish Scott who was the Minister presenting the proposals to tender CalMac to Parliament 14th September 2005 when he and colleagues misrepresented my views on the issues - as some other MSPs correctly observed and stated at the time in that debate.

I think my statement in the submission above could be regarded as generous given the treatment of me by Mr Scott and his colleagues in that debate when I was given no chance to defend myself.

But rather than show appropriate humility and accept due responsibility for the present situation, he is now publicly creating the impression that all this was the Commission's fault. The BBC reports Thursday 17th April that

(Tavish Scott) claims that the previous Holyrood administration, of which he was a member, launched an expensive tendering process, having been advised that this would comply with EU rules. He told BBC Scotland if that advice was wrong Brussels should refund the £20m cost of the tendering process to the tax payer. "In those circumstances I think the European Commission should pay the Scottish taxpayer £20m," he said. "We went through the steps we did as a result of the European Commission. Parliament didn't like it but we were told under legal advice that this was the route that had to be followed. If it turns out that they didn't like that process and they subsequently decide we shouldn't have done that, then I'll be looking for a cheque payable to Scottish taxpayers."

I think some clarification is needed at this point

First, Tavish Scott portrayed the Commission bogeyman to scare MSPs into voting for his proposal in the Parliament debate. He said at the time

The Commission could order the immediate cessation of subsidy to CalMac and order the Executive to recover from CalMac all subsidy that had been declared to be illegal state aid. That would put CalMac out of business and bring its services to a halt.

Second, Tavish Scott as responsible Minister in the CalMac debate was basing his dismissal of my own proposal on a document released by his department just before that debate where it said in consideration of my proposal

the Altmark criteria are not applicable to ferry services which fall within the scope of the Maritime Cabotage Regulation.

Third, Tavish Scott as Minister responsible, stated in a parliamentary answer, June 13th 2006;

"Public Service Obligations (PSOs) would not provide that certainty and security of service nor deliver on the Executive's key policy objectives. Consequently there is no need to consider, nor do we intend to consider, issues arising in relation to PSOs".

On the first point, I said at the time, and have continued to say since (most recently in my Submission of 15th April), that there was no suggestion that these services would be terminated or interrupted as a consequence of any Commission investigation. That has since been confirmed by the Commission in their Press Release confirming their formal investigation where they explicitly say;

The decision does not question the need for a regular and affordable lifeline ferry service for local communities, nor does it threaten the continued provision of such essential services in the future.

On both the second and third points, Commissioner Barrot responded on behalf of the Commission in an answer as to whether public service obligations were needed for subsidised ferry services 6th October 2006;

"The imposition of public service obligations is … a precondition for any compensation being given. Such compensation does not constitute State aid if it complies with the criteria laid down by the Court of Justice in its judgment in Altmark"

In short, contrary to all that Mr Scott implied, there is no threat from the Commission to the continuance of these services, and public service obligations (PSOs) and Altmark are both not only relevant, but central to defending and promoting subsidised ferry services.

Mr Scott as responsible Minister at the time of the CalMac debate (September 14th 2005) may have had some excuse in so far as he was acting under advice, though that still does not excuse the systematic and unjustified trashing of my arguments and those of my other two colleagues from Glasgow and Edinburgh universities under his leadership in that debate.

But Mr Scott now has no such excuse since the points about Altmark and the need for PSOs have been made very clear, not just by myself (eg see here), but by the Commission.

In fact, in wrongly suggesting that a Commission investigation could lead to the suspension or cessation of these lifeline services, in wrongly rejecting the central relevance of Altmark, in wrongly rejecting the need for PSOs, all that while he was the responsible Minister in that crucial debate in 2005, then if there is one person who could probably be said to be mainly responsible for the circumstances that led to the Commission's Decision to launch a formal investigation here, that person is Mr Scott. If he clearly did not understand then (and apparently still do not understand now) the basic mechanisms through which you comply with EC law in this context, is there any wonder that the Commission wishes to check that you have adhered to EC law here?

If you built a house and say the published building regulations are irrelevant, should you be surprised if the inspectors decide to call, and if they do, whose fault is it? Well, Altmark and PSOs are the equivalent of building regulations for EC subsidised ferry services.

His call last week that "If it turns out that (the Commission) didn't like that process and they subsequently decide we shouldn't have done that, then I'll be looking for a cheque payable to Scottish taxpayers." would be laughable at the best of times. If view of the seriousness of the situation that has been created, it is beyond being funny, it is a provocative and potentially very dangerous statement to make. And in view of the responsibility that Mr Scott bears for all this, I will leave other to find appropriate adjectives and nouns to describe his past and present behaviour in this context.

Neil Kay April 22nd 2008