The Rt Hon Malcolm Bruce MP

Column (June 2)

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Scotland's newest MEP will make a difference

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I'm delighted that George Lyon was successfully elected to be the Liberal Democrats' member of the European Parliament in last week's elections and Scotland's newest MEP.

As a former president of the Scottish NFU and Scottish Finance Minister I am sure he will be an effective member of the Parliament and will campaign around Scotland to ensure Scotland's interests are effectively represented.

Overall the level of public and media interest and participation was low. The turnout in the North East was only around 29 per cent. I am sure part of the reason is that voting for a party disengages voters from personalities.

In the end there was little dramatic outcome across the country. The fall in the Labour vote meant that the Conservatives, Liberal Democrats UKIP gained a seat each and the BNP won two seats in spite of not increasing their vote. The SNP gained none and Labour lost 5.

I am in favour of proportional representation but there are many better systems than this.

Overall the turnout and method of voting means that the outcome of the Euro elections gives little or no guidance as to any general election. Taken with the English council elections the main news was the appalling showing of the Labour Party.

The Conservative vote was below expectations. The Liberal Democrats more than held up but Labour had their worst result ever.

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Labour collapse has unforeseeable consequences

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In the wake of such appalling results and the walkout of a stream of ministers Gordon Brown was forced into an early reshuffle. These events are always hyped by the media but are generally greeted with a big yawn by the public.

The conventional wisdom is that any change of Prime Minister would force an early election that would see Labour wiped out. Labour MPs therefore conclude that keeping Gordon Brown is a lesser evil although I suspect he will be at risk after the party conference when it might be argued that by the time a new leader is elected it will be nearly Christmas and an election can still be held over until May.

The Prime Minister's talk of democratic renewal has been greeted with understandable scepticism. Labour came in pledged to reform but after 12 years hasn't moved. Now is too late.

To most people it seems that Labour is doomed beyond recovery. This seems likely to lead to a low turnout and a fragmentation of votes in different directions. The Tories are not the sole beneficiary and could find themselves without a popular mandate.

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Reshuffle gives low priority to oil industry

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Locally the reshuffle has shown once again the low priority given to the oil and gas industry by the Government. It is true that the industry has established better relationships with the Treasury but that has only yielded modest concessions.

Now the industry is represented by Lord Hunt, a minister in the Lords, and an unpaid junior minister in the Commons.

Yet oil and gas still represents a major part of UK industrial investment, sustains hundreds of thousands of jobs and an important export market.

In the North East we know how important it is to our economy and how challenging it will be with volatile oil prices to maximise our long term production.

It is comforting for us to see the oil price top $70 but rising fuel bills have an adverse effect on other sectors. In any case, companies have postponed some developments, downward pressures on costs are hitting contractors and suppliers and uncertainty over the fuel price and UK tax intentions make it more difficult for medium sized operators to raise the necessary finance.

We need a positive attitude from Government and more security of price if we are to get through the downturn without too much impact on local jobs and earnings

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Fuel tax should go to transport

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Meanwhile, prices at the pump are on the rise again with the combined effect of rising crude prices, the exchange rate and the fuel tax escalator.

The Government may be understandably reluctant to give up revenue given the dire financial mess we are in but for people and businesses living in remote and rural areas rising prices are a worry.

The Government could have a tax variation for such areas and I believe our new MEP George Lyon will be pursuing this with Brussels.

However, paying high fuel taxes might be more acceptable if the Government was to divert the revenues to support investment in public transport.

The Government crashes ahead with building a third runway at Heathrow while making no progress in giving Britain the high speed rail links that it needs and that are commonplace on the Continent. We are not even getting the modest investment in commuter services that we are entitled to and would give people at least the option of leaving their car behind for more journeys.

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Time for Scottish taxes to fund Scottish services

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The Calman Commission has come up with some interesting recommendations on the future financing of the Scottish Parliament which are not dissimilar to those actively discussed in the constitutional convention in the mid 1980s.

Essentially it is suggesting a share of the taxes raised in Scotland should be directly assigned to the Scottish Parliament which should also be given powers to borrow.

This would reduce the Parliament's dependency on the Barnett formula and help spread the cost of funding capital, projects so that we wouldn't face the present problem that replacing the Forth Bridge would not squeeze out every other investment project.

It would make the Parliament more accountable and would connect its revenues with its performance in contributing to economic and income growth.

I hope that at the same time we would review the funding of local councils which is currently worked out in a way that is unfavourable to the North East.

Before the introduction of council tax and national business rates local councils had direct control over much more of their income than is the case today.

Millions of pounds of business rates leave the North East every year never to return and the formula for distributing Government grants to local councils has been abdicated by ministers to COSLA ( the Convention of Scottish Local Authorities) a highly political body geographically and political controlled by people with no understanding of or interest in the needs of the North East.

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It is high time Ministers took some leadership.

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The North East probably contributes more per head to the UK and Scottish economy than anywhere else in the UK yet we are struggling to get a bypass, a commuter rail service, various road upgrades, a high speed rail link and much needed new or improved schools and hospitals and more social housing for those hard-working people who do not achieve the heights of economic benefits. .

This seems to be a matter of complete indifference to either the Scottish or UK Governments. Over the years I have campaigned for and got improvements to all of these services by dint of perseverance. I will continue with that for as long as it takes.

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Poor mega cities are a major challenge

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Arguably the challenges facing us pale into significance when compared with developing countries.

This week I have been looking at the challenges facing the urban poor in Africa's largest city - Lagos.

At the time of Nigeria's independence Lagos was not even Nigeria's largest city. Now the population is estimated at around 18 million and projected to reach 25 million within the next few years - making it the world's third mega city.

I visited some of the poorest slums in the city and saw the challenges facing people living right on the edge - without security, infected by HIV/AIDS, miserably poor with poor schooling and surrounded by effluent and rubbish.

For those who have jobs, travelling across the city can take hours. The opportunity for improvement is limited as the population of the city is swollen by migration and natural growth.

If Lagos cannot cope now, how will it cope with 6 million more?

We saw admirable measures to improve the environment, to provide dedicated bus routes and to tackle HIV/AIDs. They were worthwhile but only scratching the surface.

We cannot solve the problems of urban poverty in developing countries but we can help. When you see the determination of urban slum dwellers living in unimaginable squalor you really want to help.

Aid and development is not just about the rural poor or humanitarian relief - it is about creating income opportunities and creating a functioning economy to generate the tax revenues that can fund urban renewal. And it is about fostering the political will to use those revenues to make the difference.

ENDS