SNP in ‘humiliating climbdown’ after deciding to embrace UK’s Brexit freeports plan

The Chancellor Rishi Sunak visits The Royal Docks in London to announce the UK's Freeports strategy - Simon Walker/HM Treasury
The Chancellor Rishi Sunak visits The Royal Docks in London to announce the UK’s Freeports strategy – Simon Walker/HM Treasury

SNP ministers have embarked on a “humiliating climbdown” after signing up to the UK’s Brexit freeports plan just weeks after it was condemned by party activists.

The Scottish Government had repeatedly expressed skepticism over proposals to offer special tax breaks and develop streamlined customs procedures at at least seven Singapore-style ports in England, and had refused to agree to calls to adopt them north of the border.

However, Ivan McKee, the SNP trade minister, on Thursday said that a version of freeports would be delivered, despite describing them in October as a “shiny squirrel” designed to distract from the damage of Brexit.

He claimed the Scottish version of freeports would be different, rebranding them “greenports” which would have a focus on reducing carbon emissions and protecting working conditions.

However, the SNP’s pro-independence allies at Holyrood accused the Scottish Government of an attempt at “greenwashing” the UK plan.

Several ports in Scotland have expressed an interest in gaining freeport status including Cromarty, Aberdeen and Dundee.

However, SNP delegates at the party conference in November passed a motion condemning the plan.

The motion stated that freeports “cannot and will not offset the damage caused by Brexit” and raised fears that they would mean low-cost, low-wage, low-value opportunities “entirely at odds with the SNP’s ambition for Scotland’s economy”.

Maurice Golden, economy spokesman for the Scottish Tories, said: “This is a humiliating climbdown for the SNP. Just a few months ago, Ivan McKee was claiming that freeports are a “shiny squirrel” and the SNP conference backed a motion slamming them.

“This screeching SNP u-turn is very welcome. It seems they have finally realised that businesses are desperate to reap the benefits from freeports.”

Dundee is among the Scottish locations to express an interest in becoming a freeport - V&A Dundee/V&A DundeeDundee is among the Scottish locations to express an interest in becoming a freeport - V&A Dundee/V&A Dundee
Dundee is among the Scottish locations to express an interest in becoming a freeport – V&A Dundee/V&A Dundee

Freeports allow firms to import goods and then re-export them outside normal tax and customs rules.

The UK last had such zones in 2012 and they are permitted under EU law. However, backers argue the benefits will be greater following the UK’s departure from the bloc, with the UK allowed to diverge from EU rules.

Speaking at Holyrood, Mr McKee said the UK plan would be adapted for a “Scottish context”.

He said: “We will take the UK Government’s freeport model and apply Scotland’s values and priorities to it so that it meets our ambition to develop a net-zero economy and uphold the highest standard of environmental protections and fair work practices.

“Scotland will turn freeports into sustainable, fair, greenports. We won’t be engaging with an economic model and mechanism that allows for a race to the bottom.

“Instead the Scottish greenport model will be an exemplar, adopting best practice which helps to deliver on net-zero and fair work principles alongside supporting regeneration and innovation ambitions.”

While he said firms located in any new greenports could potentially benefit from some rates reliefs, he added there would be “clear conditions” and “obligations” they would have to meet.

These could include companies having to pay staff the real living wage and sign up to the Scottish Business Pledge, which bars firms from using zero hours contracts and commits them to working to tackle the gender pay gap.

However, Mark Ruskell, environment spokesman for the Scottish Greens, said: “Simply calling a freeport ‘green’ doesn’t guarantee environmental and workers standards, and presents a real risk of greenwashing a deregulated race to the bottom.

“We haven’t seen any detail of the environmental standards these ports will be expected to uphold. They must not be part of the Brexit race to the bottom in standards and protections or given free reign over planning decisions, which must remain accountable to local communities.”

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