HC Deb 16 December 1992 vol 216 cc424-6
9. Mr. Shersby

To ask the Secretary of State for Scotland how many whisky distillers are currently in operation in Scotland now and 10 years ago.

Mr. Stewart

There are currently some 25 whisky distillers operating in Scotland. In 1982, there were 32 quoted companies engaged in Scotch whisky distilling.

Mr. Shersby

Is my hon. Friend aware that distilleries are at the heart of rural communities in Scotland and that any further closures will be quite devastating to the people of those communities? Is he also aware that sales of whisky in the United Kingdom have dropped by 1 million bottles while sales abroad, where it is taxed less and costs less, have held up? Will my hon. Friend consult the Chancellor of the Exchequer and ask him, at the very least, to peg whisky duty so it can compete on level terms with imported wines?

Mr. Stewart

The reduction in the number of distillers in the past 10 years is mainly attributable to mergers and acquisitions within the Scotch whisky industry rather than to companies going out of business or ceasing to run their distilleries. My hon. Friend is right to point to the importance of distilleries, particularly to rural areas and to the success of the industry in the export market. I had the great pleasure to attend a Queen's award for export ceremony at Burn Stewart distillers in Barrhead in my constituency.

I have no doubt that my right hon. Friend the Chancellor will consider my hon. Friend's views about duty on whisky, as well as the views of others, including the well-presented research by the Scotch Whisky Association, which was recently sent to the Treasury.

Mr. McKelvey

Nevertheless, I hope that the Secretary of State for Scotland had the opportunity to peruse the Pieda report, which stated clearly the importance of the Scotch whisky industry to the Scottish economy—it is responsible for 15,000 direct jobs and 56,000 indirect ones. Those jobs will be threatened if the Chancellor does not show some partiality between the tax on wine and that on whisky—in whisky's favour. At the moment the tax on whisky is twice as much as that on wine and such an imbalance must be redressed.

Mr. Stewart

The hon. Gentleman's record as a strong defender of the interests of Scotch whisky is well appreciated throughout the House. He is, after all, chairman of the all-party Scotch whisky industry group. He has made an immense contribution to the debates about the industry. I repeat that I am sure that my right hon. Friend the Chancellor will have noted what the hon. Gentleman said.

Mr. Bill Walker

Will my hon. Friend bear in mind that the distilleries and the whisky industry are Scotland's premier exporting industry, and that it will continue for ever if it is looked after properly? Would he and his right hon. Friend the Secretary of State have words with the Chancellor and draw his attention to the fact that if whisky and other spirits were subject to the same tax as that on wine there would be a substantial reduction in income to the Treasury, but that if the tax on wine were brought up to the level of that on whisky there would be a substantial inflow of funds to the Treasury? We have never understood why the Treasury has not seen that option as an opportunity to get more money.

Mr. Stewart

My hon. Friend is known for his own Bill that benefited the industry. He is absolutely right; no one can dispute the key importance of the Scotch whisky industry in relation to the Scottish economy and exports, the value of which in 1991 was more than £1,800 million.

I am sure that my right hon. and hon. Friends at the Treasury will have noted the specific points that my hon. Friend has raised. I can reassure him that my right hon. Friend the Secretary of State is in close consultation with the Chancellor on all matters relating to Scottish industry which affect the Treasury.