Pitlessie Fair?: Some Thoughts On The ‘Forth Green Freeport’ From A ‘Political’ Artist
The so-called ‘Forth Green Freeport’ is one of two in Scotland. The other, located in the North East, encircles the Black Isle and Cromarty Firth. The Forth ‘freeport’, or ‘Special Economic Zone’, envelops a large swathe of the Edinburgh and Fife conurbation. Its boundaries stretch from Falkirk to Portobello and from Burntisland to Loanhead. In total, it covers 45km and encompasses Edinburgh airport, Grangemouth and Rosyth.
The ‘ambition’ of the ‘freeport’ is to create 50,000 ‘green’ jobs and the good people on £72k + benefits behind bullet-proof glass at Holyrood ‘believe’ it will ‘make a major contribution to Scotland achieving its net zero carbon emissions targets’. Private investors in this ‘accelerated green pathway’, backed by public money, benefit from financial incentives such as ‘enhanced capital allowances’, ‘employer’s national insurance contributions relief’, ‘land and building transaction tax relief’, ‘duty suspension’, ‘duty flexibility’, ‘duty exemption’, and ‘simplified import declarations’. The consortium behind the Forth ‘freeport’, like the one in Cromarty, is a State-corporate nexus including, amongst others, Edinburgh Council, Ineos (one of the world’s largest petro-chemical companies), Babcock’s (manufacturers of WMD), Heriot Watt university and various ‘private equity’ companies.
What then, might we ask, as ‘the tax sites go live’, is the liberal-minded Scottish easel-painter to make of all this? What impact will ‘expanded logistics’ and a ‘just transition’ have upon the conscientious artists of Lothian and Fife as they prime yet another canvas? No need to worry! The powers-that-be, namely a former Lloyds banker, a billionaire Brexiteer and a company who repaired a nuclear sub with a tube of superglue, can reassure producers of traditional seascapes and Will MacLean-esque assemblages of driftwood and fishing industry detritus that the ‘accelerated green pathway’ is in the safe hands of Scotia’s finest ‘cluster partners’. No doubt, the 8,900 children living in poverty in Granton will feel a sense of relief knowing the ‘tax burden’ has been significantly reduced for such altruistic souls.
With such existential threats to West Pilton and Muirhouse neatly expunged, the ‘green investment zone’ can develop apace and production of the next Eardleyish gestural tribute can go on unmolested. Don’t worry! Sightings of conning towers and plastic pellets popping up from beneath the latest swatch of impasto ultramarine are merely signs of a redundant shoreline transforming into a ‘hot bed of innovation’.
In 1945, Clement Attlee’s Labour government implemented a programme of social and economic reconstruction in post-war Britain. For the first time in the UK, statutory labour rights such as holidays, sick pay, pensions and the right to a minimum of work were enshrined in the relationship between employer and worker. Defined by its attempts to eradicate ‘Want…Disease, Ignorance, Squalor, and Idleness’, this socially-purposive project embodied the country’s move to a mixed economy, a universalist welfare state and nationalisation of the utilities. This concord, designed in the aftermath of a 1930s scarred by the horrors of poverty, ethno-nationalism and slaughter, was unprecedented in the history of British labour relations. For my maternal grandfather Jimmy Newlands, a docker at Leith, the latter was particularly significant given that for many years dockers such as him, and his brother-in-law Alec (a communist and shop-steward), had suffered the indignities of casualised labour and ‘non-contract’ hiring.
So, maybe I’m just being paranoid? Being a ‘political artist’ can be tiring! Perhaps the corporate sloganeering is true and it’ll all be ok? Maybe the not so nice things that happen to ‘freeports’ in other parts of the world won’t happen in bonnie Scotland and we’ll be spared the cronyism, corruption, tax avoidance (by ‘letter-box’ and ‘shell’ companies), money-laundering, misguided infrastructure spending, lack of a green agenda, inadequate bureaucracy, non-unionised workers, the incentivisation of lobbying companies, tax benefits for the few, closed systems, the throwing of money at unprofitable projects, ‘superior’ performance at the expense of other areas, lack of local authority oversight and smuggling.
Maybe the artists will get a shiny new building and receive some much-needed dough from a corporate entity whose shareholders have just rejected the most recent climate change resolution. Who knows? Perhaps I just need to try harder to believe in the autonomous object? Or maybe, in a rare moment between private helicopters, one of our esteemed corporate leaders might swing past and buy a reasonably priced ink on paper (unframed)?
So if the composition is unbalanced, if it’s hard to work plein-air because of the smoke and the seascapes are ruined by those pellets that keep washing up, then maybe we can join the kids from Granton? They’ll be teenagers by then and we can all traipse along to the local ‘skills accelerator centre’ for some ‘simulator training’? Maybe they’ll tell us something about identity, place and belonging when we’re there? Who knows? Maybe I’m just being nostalgic?
Forth Green Freeport sounds like the slightly-before stage of the contaminated wasteland in Fallout 4, but does artistic licence really exempt you from providing a single link?
As for Attlee, I’ve collated a few choice words I don’t need to repeat here.
https://bellacaledonia.org.uk/2024/06/03/reservoir-dogs/
Bravo!
Beautifully skewered, thank you!
Freeports (the SNP calls them ‘Green Freeports’) are a mechanism for delivering state subsidy, mainly in the form of tax-breaks, to infrastructure projects in parts of the country that have historically missed out on such investment.
Previously, that subsidy went straight of local authorities and government development agencies in the form of grants. That mechanism, as well all know, didn’t work; it didn’t realise the social and economic returns it was supposed to generate.
Freeports represent a different model for delivering state subsidy. Rather than disbursing grants of money, freeports deliver state subsidy through through the granting of tax-breaks, which incentivise investment in the historically disadvantaged areas in which they operate.
Another crucial difference is that freeports aren’t owned and operated by the state through local government and/or government development agencies. They’re owned and operated by consortia of local stakeholders, led by the local government authorities in the freeport area.
My beef with freeports is that, in practice, they’re not democratic enough. The involvement of local council officials in their governance does ensure a measure of democratic accountability, but trades unions, community councils, and other grassroots stakeholder groups are still woefully underrepresented on their governance boards.
The presence of such grassroots stakeholder groups would add another, more powerful layer of democratic governance and accountability.
Who, for example, represents the kids of Granton on the board of the Forth Green Freeport? Or, as SleepingDog might ask, the birds on Inchcolm for that matter?
Edinburgh is not “an area that has historically missed-out on infrastructure investment”.
Depends what you mean by ‘Edinburgh’. Granton’s hardly seen much in the way of investment.
And besides, Forth Green Freeport’s four ‘tax sites’ are Grangemouth, Rosyth, Burntisland, and Leith. That’s where the investment’s being targeted, not Edinburgh.
What investment??? It is our money that is funding fhis. We are paying them. Do check European Powell on X to educate yourself.
‘We are paying them.’
Correct; that’s the nature of subsidy.
Yes, but for what return? De-regulated,, non- tax fiefdoms with no controls from central nor local government.
HERE IS EUROPEAN POWELL ANALYSIS:
Here’s what Labour and Cons are currently implementing while the campaign fodder and endless lies from Starmer piles up, namely 12 Freeports and 74 SEZs. Special Economic Zones are experiments in colonialism and corporate governance entailing even further privatisation of public services, and asset stripping of councils as they go bankrupt.
According to the Govt’s own website, there is no evidence that Freeports and SEZs improve economic growth or facilitate job creation. These extraterritorial zones are privately governed with their own laws and regulations separate to the host country. Deregulated Freeports and SEZs are tax havens that contravene EU rules on State Aid (public money) a direct consequence of Brexit. There was no mandate for installing Special Economic Zones that will cost the taxpayer billions in State Aid subsidies to companies of the Govt’s choosing (prohibited in the EU). Jeremy Hunt has declared these zones as tax-exempt for 10 years, and licensed them for a quarter of a century. The Govt is basing its economic growth models on Singapore, Shenzhen and Kong Hong where democracy was bypassed for astronomical capital gains.
Labour MPs, Mayors, councillors, Lords, and Baronesses are board members of Sunak’s nationwide Freeport/SEZs consortia.
This is happening right now, Brexit is being forced to work.
Don’t vote for Labour0
They’re not ‘extraterritorial zones’ nor are they ‘privately governed with their own laws and regulation’. They are special areas within the jurisdiction of Scots UK law where different economic regulations apply. They’re centred around one or more air, rail, or sea port, but can extend up to 45km beyond the port. The Forth Green Freeport is still part of Scotland and subject to Scottish law.
They’re not ‘tax havens’. They offer businesses a secure, enclosed customs zone (in the case of the Forth Green Freeport, Edinburgh airport) where SOME normal tax and customs rules don’t apply. Authorised businesses can import certain goods through the freeport’s customs site with simplified customs documentation and without paying tariffs. Businesses located withing the freeport zone can then manufacture goods and export them again with value added, thereby reducing their manufacturing costs. However, where goods are declared to ‘free circulation’ (i.e. home use) in the UK, all relevant duties and tariffs must be paid before they can be released from the customs site.
They also offer businesses tax sites (in the case of the Forth Green Freeport, Grangemouth, Rosyth, Burntisland, and Leith), in which businesses can benefit from a range of tax incentives. This includes enhanced capital allowances and employer National Insurance contributions for new employees. Relief is also available on Land and Buildings Transaction Tax in Green Freeports in Scotland. New businesses moving into a Freeport tax site, and some existing businesses that expand, will also benefit from full non-domestic rates relief in Scotland.
These customs zones and tax sites are intended to incentive businesses to set up shop in the freeport area rather than elsewhere by making it less expensive to do so. That’s the nature of the subsidy: tax relief.
Whether this kind of subsidy contravenes EU regulations is neither here nor there; Scotland is now independent of EU regulation.
There are no Special Economic Zones (SEZ) in the UK. SEZ are , where businesses enjoy autonomy from the laws of the surrounding ‘host’ country relating to employment, planning, tax liability, and some areas of justice, education, and property. There are just freeports and investment zones (Glasgow City and the North East regions in Scotland). UK investment zones offer targeted public investment in projects aimed at boosting the local economy, stimulating business growth, and creating high-quality, well-paid jobs. Those projects are planned and delivered by each area’s Regional Economic Partnership, which is made up of local authority leaders, businesses, and higher and further education institutions.
Be advised that David Powell doesn’t half talk some sh*te at times.
But I do agree that both freeports and investment zones are lacking in democratic governance, despite the leadership that publicly accountable local and national government provide to their boards. There are important economic interests (e.g. trades unions, chambers of commerce, community councils, and voluntary organisations) that are not represented on their boards. This, in my view, is why they will ultimately fail in the same way that previous local development initiatives by central government have failed.
No they have not. Independence would allow proper governmental oversight.
They are a trojan horse ‘brexit’ extension to prevent our ever re-entering the EU – as they are not publicly owned. Continuation of pfi where we pay the bill and profits are never realised – other than to ‘investors’. Sorry but i cannot take your logic as it contravenes my gut instinct. They are fundamentally wrong. For me nae pasaran.
‘Independence would allow proper governmental oversight.’
That’s the Bexit argument in a nutshell.
But you go with your ‘gut instinct’, Mairi. God knows, a lot of the folk who voted to make the UK independent of the EU went with theirs – and see where that got us!
No it is not. Diametrically opposed. Lazy trope as rebuttal. My fault for citing another flighty option mea culpa.
This – is a continuation of Brext.
Carving up key parts of the uk to private overlords. Jeezo lets not even start about the fact our ports are fing privatised un the first place. Crikey the generation of trade through our ports is hobbled and castrated by that very fact. How can we not own the levers to generate trade? Private ownership will never create long term investment that public ownership would. Plus will inevitably result in uneven playing fields….
Hence why EU rules prevent it. We are indeed lost if you think this extended privatisation is a good thing. What is your beef i wonder. Are you involved perhaps? Transparency would help me here.
Freeports are less a continuation of Brexit and more a way of delivering state subsidy that Brexit made possible.
Our ports aren’t being privatised; Forth Ports Authority were privatised in 1992; before that, it was owned by a public trust rather than by the state. Irrespective of what your ‘gut’ tells you, the claim that Forth Green Freeport is privatisation by stealth is a red-herring.
State owned industries failed historically in Britain because of lack of investment. Remember that, by the end of the 1970s, the state was virtually bankrupt; it couldn’t afford to modernise our heavy, manufacturing, and transport industries and thus keep them viable in the global economy, and it couldn’t borrow the money it needed to do so (the IMF wouldn’t let it). In response, the Thatcher revolution changed the investment model to one in which economic development was primed by the state but fueled by private investment. That’s the model on which freeports (and investment zones) are based. Trying to back to the state capitalism of the 1960s and 70s isn’t the answer. Those days are past now…
My ‘beef’ is with the democratic deficit in the governance of freeports and investment zones. Their boards need to be opened up to a broader range of local stakeholders, including trades unions, chambers of commerce, community councils, and voluntary organisations. But I’ve already told you that.
State investmrnt is a pokitical choice. The state chose to bail out the banks. Thatcher chose to sell off the states assets, for which there was no return.
These zones/freeports do not as you rightly point out allaw governance of all parties involved therefore cannot be transparent.
Not convinced
It is indeed a political choice; public decision-making is by definition ‘political’.
Alistair Darling’s decision to intervene financially to support the UK banking sector in general and four UK banks in particular during the global financial crisis in 2008, for example, was a political decision. Whether that decision (to take Northern Rock, Bradford & Bingley, the Royal Bank of Scotland, and Lloyds Banking group into public ownership to guarantee account holders’ deposits and thereby restore confidence in the banking system) was the right one is a moot point, the outcome of which will depend on your ideological prejudices. His intervention did succeed in stabilising the economy. And while total guarantees added up to over £1 trillion at peak support, the UK Office for Budget Responsibility reported that the actual cash outlay of the recovery plan (in the form of loans and new capital) was only £33 billion, most of which has since been recouped by the Treasury. Sounds like it worked.
Broadly similar measures were introduced by the United States and the blesséd European Union in response to the financial crisis.
It’s also pertinent to note that there are currently 72 freeport/investment zones in 20 member states, across the EU. Indeed, the UK hosted seven freeports as an EU member state between 1984 and 2012. These were located at ports including Prestwick Airport. The claim that freeports and investment zones are ‘a continuation of Brexit’ is nothing but fake news.
I warned you: David Powell doesn’t half talk some sh*te at times.
I am surprized to discover that, living in Leith, I am no longer in Edinburgh. When did Leith separate from Edinburgh ?
Edinburgh and Leith were joined in an incorporating union in 1920. A lot of ‘true Leithers’ still resent this union and hanker after Leith’s lost independence. The Boundary Bar (now, I believe, the ‘Bier Hoose’) used to have a line on the counter that marked the border between their once separate jurisdictions. Bit like the border at Gretna.
Absolutely agree with your drawing attention to this. Outrageous proposition – enabled by snp and labour, colluding with tories. – must follow European Powell on X he has researched this for years, published, spoken at events throughout this UK (Inverness, Perth, Edinburgh). There is a trail of corruption. He has all the links you will ever need. Evidence.
Of course there’s corruption in the governance of the Freeports, which is dominated by big businesses, who want to trouser the subsidies while making only token investment in the areas of benefit themselves. That’s the way all infrastructure development schemes work – and have always worked – the real world. And that’s why they inevitably fail. The problem is that the governance of such schemes isn’t democratic enough.
BTW Isn’t David Powell a rather strange fish; a libertarian who supports the administration of our lives by the bureaucracy of a quasi-state like the EU?
On the ‘very British disease’ of unhinged rip-off privatisation, this article (from 2013) makes some very interesting points:
“Britain is an extreme oddity regarding privatisation: nowhere else in the advanced world is there such a willingness to sell everything that isn’t nailed down. Time and again the British public is ripped off and sold out by its leaders.”
https://www.opendemocracy.net/en/opendemocracyuk/privatisation-very-british-disease/
But, as I’ve explained, the Forth Green Freeport involves no privatisation; the Forth Ports Authority is already privately owned, and has been since 1992.
The Forth Green Freeport is a mechanism through which state subsidy is delivered to economically disadvantaged areas by providing tax breaks to companies who set up their businesses in Grangemouth, Rosyth, Burntisland, and Leith.