Extracts from Scottish Parliament questions (Deputy First Minister Responsibilities, Economy and Gaelic): Grangemouth - Oct 30

Chemical Production Sector (Grangemouth) (Economic Value)

5. Michelle Thomson (Falkirk East) (SNP)

To ask the Scottish Government how it plans to sustain the economic value of the chemical production sector based around Grangemouth. (S6O-03849)

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

We are committed to securing a long-term and sustainable future for the Grangemouth cluster. We will shortly publish our draft Grangemouth just transition plan, which details the shared vision for the future of the cluster as Scotland's premier location for investment in advanced chemical manufacturing. As part of the plan, which has been developed in collaboration with the Grangemouth future industry board, representatives from the chemicals manufacturing sector are supporting the development of a cluster strategy that is aimed at attracting new investment. That work will be supported by the Forth green freeport and the Falkirk and Grangemouth growth deal.

Michelle Thomson

The threat to the refinery is equally a threat to the chemical cluster and a threat to Scotland's economic economy. Given the recent award of Scottish Enterprise funding to Ineos for the green freeport initiative, what further incentives might be provided through the Forth green freeport, or directly to the cluster, to maximise long-term financial sustainability and enable growth, as outlined in the green industrial strategy?

Kate Forbes

Michelle Thomson makes an important point. I believe that the Scottish Enterprise funding that she is referencing is not actually part of the green freeport programme but is part of funding for exploration of the potential for hydrogen generation at the site. Grangemouth has the potential to be a significant part of Scotland's low-carbon transition, which is why we have confirmed £50 million through the growth deal and have jointly funded the £1.5 million project willow study, which was discussed again yesterday in my regular meeting with the Secretary of State for Scotland. A range of specific interventions and supports are available.

Closure of Grangemouth Oil Refinery (Update)

6. Richard Leonard (Central Scotland) (Lab)

To ask the Scottish Government whether it will provide an update on the potential closure of the Grangemouth oil refinery and any economic impact that this may have. (S6O-03850)

I remind members of my voluntary declaration of my trade union interests.

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

As Richard Leonard will know, PetroIneos announced on 12 September that refining would cease during the second quarter of next year. That is a commercial decision that was taken by the business alone and despite the joint efforts of the Scottish and United Kingdom Governments to secure those investments in the asset beyond 2025.

It is our understanding that the immediate impact of that decision will be the loss of around 400 full-time roles. We are all—jointly, as Governments—committed to doing all that we can to support the workforce during the transition period. That is why we announced the provision of tailored skills training at Forth Valley College, which is supported by both Governments and is targeted towards those who are directly impacted by the decision.

Richard Leonard

The cabinet secretary must know that the rate of unemployment in Grangemouth is already twice the national average and that this is a community that is already impoverished.

The statutory redundancy consultation closes in mid-December, so the clock is ticking, but there is still time to save these jobs. In the coming days, will the economy minister, together with the First Minister, intervene—just as I call on the UK Labour Government to intervene—to avert the redundancies and extend the life of Scotland's only oil refinery? Will it do so not only in the interests of those workers, their families and this community but in the strategic interests of our country's economy, energy security and national security?

Kate Forbes

Richard Leonard made an important point about the impact of the loss of those jobs on the local economy. That is precisely why, for the past few years, the Scottish Government has been doing everything in its power to save the jobs and to save refining at Grangemouth. We are still working to support individuals who are at risk of redundancy through the skills package that I talked about in my opening answer. The funding that we have put in place will allow PetroIneos employees at Grangemouth to access the opportunity to reskill, and we will support them with new employment.

The long-term future for the site is precisely why we are involved with project willow. We have spent considerable sums of money during the past few years looking for a long-term future for PetroIneos. This is a commercial decision. We are all keen to jointly ensure that there is a future for those workers, and we are working together to do that.

David Torrance (Kirkcaldy) (SNP)

It is vital that we continue to support the workers based at Grangemouth and their families during this difficult time. I welcome the additional funding that the Scottish Government has provided through the Falkirk and Grangemouth growth deal. Will the cabinet secretary say more about how that will help to grow the regional economy and support the community and workers?

Kate Forbes

The £50 million that will be provided through the Falkirk and Grangemouth growth deal over the next 10 years is designed to unlock economic growth opportunities that will create the jobs that ensure that the unemployment rate is low and employment rate is high. We must not lose sight of economic inactivity.

Our investments in the growth deal include £2 million towards the sustainable manufacturing campus to allow the development of new technologies in the region and £12 million on the greener Grangemouth programme. The wider growth deal is expected to bring significant benefits during the coming year and to generate £628 million over the next 30 years.