§ Ms Rachel Squire (Dunfermline, West)I am pleased to have the opportunity to discuss the future of motor sport facilities in Scotland. I shall use the debate to highlight the success of Scotland's national motor sport centre at Knockhill in my constituency and express the grave concerns that I and many others have that a proposed alternative facility at Forrestburn in Lanarkshire could lead to no winners, only losers, and a waste of public money.
If the Minister and other right hon. and hon. Members want an exciting day out, I recommend that they head for Knockhill rather than remain at Westminster. Knockhill is recognised by the Scottish Sports Council and the Scottish Motor Sport Federation as Scotland's national motor sport centre. The track deals with a wide range of car and motor cycle racing. It was declared the circuit of the year by the Touring Car Association. If the Minister and other right hon. and hon. Members want to visit a successful private enterprise, I recommend Knockhill.
The track was rescued from receivership some years ago by the director, Derek Butcher, who has put more than £3 million of his own money into the venture. Knockhill has not received any public funding for capital expenditure yet it employs 16 full-time permanent staff directors. The track supports three franchise businesses on site with a further 10 permanent staff. It takes on up to an additional 100 part-time staff when there is a big event. It thus makes a considerable contribution to the local economy. In addition, when there is a big event such as the British championship for touring cars, hotels in the Fife area are fully booked. The circuit manager, Eric Houston, said:
We put more people into hotels than Open Golf does",and that is once a year, not once every four years.Knockhill's success, however, is threatened by the proposed development at Forrestburn. I can understand the Minister saying that that is a shame but asking why it should concern the Government. Let me explain.
The Minister is aware that, because of their industrial decline, parts of Fife and parts of Lanarkshire are eligible for support from European structural funds. That means that decisions on proposed programmes for areas that seek European funding are taken by committees. The principal committees involved in taking decisions on individual projects such as that at Forrestburn are, I understand, the programme management committees for eastern and western Scotland. They are chaired by the Scottish Office development department, acting on behalf of the Government as the official implementing authority for European Union funding programmes.
The first reason, therefore, why the Government should be concerned about the future of Knockhill and the proposed development at Forrestburn is that the Scottish Office retains responsibility for the payment of European grant money and is ultimately responsible for the audit requirements. My understanding is that Forrestburn has been allocated £1.4 million in European grant money, so the Government have a direct interest.
The second reason why the Government should be concerned about the Forrestburn development is that there is strong evidence that the use of European money to 1505 support the project will, in effect, displace an existing facility—in other words, it will put Knockhill out of business. I understand that such a displacement contravenes the rules for European funding.
The Treasury defines displacement as occurring when support for one project has the effect of reducing economic activity in other parts of the economy. I understand that a displacement analysis has been undertaken, but considerable concern has been expressed by many organisations that do not believe that it went into sufficient depth to enable it to be established that the only way in which Forrestburn could be successful was by taking much of Knockhill's business.
It appears that key interests such as the Scottish Sports Council, Fife Enterprise, Fife regional council and Dunfermline district council were not fully consulted about their views on displacement. Scottish Enterprise told me in a letter dated 27 October this year that
the developers of Forrestburn have not adequately addressed the question of displacement … if the Forrestburn project proceeds it may very well put Knockhill out of business.In the past few days, Scottish Enterprise has changed its tune—one can only speculate why that is—but I hope that the Minister will want to satisfy himself about the adequacy of the displacement analysis that has apparently been conducted.People with expertise and interest in motor sport facilities in Scotland believe that Forrestburn will be viable only if it takes business from Knockhill.
§ Sir Hector Monro (Dumfries)Although I do not know a great deal about Forrestburn, I agree wholeheartedly that Knockhill has been a huge success in hosting not only the touring car championship but motor cycle racing and weekly club events, which are so popular in Scotland. Whatever my hon. Friend the Minister says in reply, I hope that he will in no way deprecate Knockhill's achievement. It has been an outstanding success in recent years.
§ Ms SquireI thank the right hon. Gentleman very much for his support, which I know will be greatly appreciated by Knockhill. I have no doubt that Knockhill would look forward to a visit from him in the not too distant future.
Only a limited number of motor racing events attract sufficiently large crowds to make a business viable. I understand that at Knockhill only three events a year attract crowds of more than 5,000, and they are vital to Knockhill's commercial success. Forrestburn would have to compete with Knockhill and take those events from it if it was to be viable.
I believe that Forrestburn hopes to attract formula 1 racing, which Knockhill does not stage. I believe, however, that there is already fierce competition among existing tracks such as Brands Hatch for such events. Formula 1 racing is very costly, and the £6.5 million being talked about for the Forrestburn development would not support even the track safety and maintenance requirements of a formula 1 racing track for a single year.
A formula 1 track was opened in Japan this year. According to one set of figures, it cost £60 million to develop and will require £10 million every year just to maintain the facilities. Therefore, without a sufficient market in Scotland, public money could be wasted and a successful business badly, if not mortally, damaged.
1506 Does the Minister believe that a detailed analysis was carried out by Lanarkshire development agency? Has a careful study been made of what events Forrestburn would host and the extent to which they would displace those that Knockhill has been successful in attracting? If a full consultation has not been carried out, will the Minister assure me that one will be undertaken; that it will involve experts in the industry, not only in Scotland but in the UK as a whole; and that it will be undertaken before any further attempt is made to decide whether there is sufficient business to support two racing tracks with such a short distance between them? The Minister's answers will be heard carefully not only by me and Knockhill but by the hotels and businesses in the Fife area, which gain so much from major motor sports events.
I have already touched on the third reason why Knockhill's future and the Forrestburn development should be of interest to the Minister. It is the apparent inadequacies in the decision-making arrangements that the proposals for Forrestburn have highlighted. I do not believe that key organisations such as Fife Enterprise and the Scottish Sports Council have been fully consulted. Not even the programme management committee for the east of Scotland was consulted. Although Forrestburn is a west of Scotland development, it will have a displacement effect on an existing east-of-Scotland facility. I understand that no direct approach to Knockhill has been made by the company involved in the Forrestburn development, Inreco, and that its only contact was three or four years ago—in a telephone discussion with KPMG Peat Marwick. Full consultation would have called into question the Forrestburn project's ability to satisfy the technical and financial eligibility appraisals and the core criteria, which include demonstrating clear evidence of demand.
I hope that the Minister will say that he believes that further investigation is necessary, and that a full and thorough displacement analysis will result, with all interested parties being fully consulted. If there is not the business to support two race tracks so close together, as I and others fear, we could end up with neither being commercially viable. Public money will have been used to build up false hopes in Lanarkshire, to ruin a successful private enterprise business in Fife and, I believe, to damage the sporting reputation of Scotland.
I hope that the Minister will bring some Christmas cheer to Knockhill and to all those who support it and are concerned with its future.
§ Mr. Deputy Speaker (Sir Geoffrey Lofthouse)I understand that the right hon. Member for Dumfries (Sir H. Monro) would like to contribute. Will the hon. Lady agree to that?
§ Sir Hector Monro (Dumfries)I shall say a few words in support of the position of the hon. Member for Dunfermline, West (Ms Squire) on Knockhill.
I have been deeply involved in motor racing and motor sport in Scotland since the war, as the former president of the Auto-cycle Union. One has seen, sadly, the demise of Charterhall and Ingliston, and Crimond up in the north. The one circuit that has been a success is Knockhill. I note that the hon. Lady said that it went through a 1507 difficult period, but in recent years it has come back very strongly indeed and is popular among competitors because in Scotland there is nowhere else to go. There are two or three major meetings that attract big crowds, particularly the touring car championship, which was an outstanding success not only at Knockhill but on television.
Many motor racing enthusiasts would have to travel far south, down to Croft or further into the midlands of England and to Oulton park if they wanted to take part in competitive motor sport. Knockhill has given them the opportunity to take part, through club meetings and renting the track for club groups. My own Bentley drivers club has a day out in August or September each year. That all brings valuable income to the area and to Fife generally. I am sure that my hon. Friend the Minister will consider carefully the important issue of whether to promote what may, on paper, be an outstanding opportunity in Lanarkshire, to the detriment of Knockhill, which is so successful.
The hon. Lady flew kites about the enormous cost of major international events. It is all very well to say that we will attract formula 1 cars, but when it is difficult for a country to stage a grand prix, it is unlikely that we would get two—at Silverstone or Brands Hatch and one in Scotland. She rightly highlighted the immense cost of staging a grand prix, and the Pacific is likely to opt out next year. I think it wrong to say that we will have a formula 1 circuit, without any definite assurance that we will get a formula 1 race. The grand prix circuit is closely controlled. There is immense competition from Brands Hatch and, indeed, from Donington, which most drivers would say is a much more attractive course on which to drive than Brands Hatch.
It is not just a simple decision. We cannot just say that we should have a brand new circuit in Lanarkshire that would attract all the competition and sponsorship that is so central to modern motor racing. We should not go headlong for that concept, although it is a great vision, without realising that it could be to the detriment of Knockhill, which has done so much over the past 10 or 15 years to give those who are interested in motor sport the opportunity to participate.
§ The Parliamentary Under-Secretary of State for Scotland (Mr. George Kynoch)I am particularly pleased to be here today to respond to the debate, which was initiated by the hon. Member for Dunfermline, West (Ms Squire), and equally to have heard the wise words of experience from my right hon. Friend the Member for Dumfries (Sir H. Monro). I am most grateful to both of them, because I believe that the debate enables us to clarify the position with regard to Knockhill race track and the proposed development at Forrestburn.
There was a discussion as to whether this was a sporting debate or an industrial development debate. I am the Minister responsible for industry and, therefore, perhaps the industrial development side. I looked at the background to the sporting side and asked to be briefed on the range of motor sports that are available in Scotland at present, and how many were pursued.
In motor car racing, we have motor racing itself; circuit racing of various classes; speed events; stage rallying, road rallying; auto tests and trials; and, indeed, stock car 1508 racing. There are around 40 motor cycling clubs in Scotland associated with the Scottish Motor Cycle Union. Events include moto-cross, road racing, speedway, motor cycle trials and motor cycle rallies. Events take place throughout Scotland—I shall come to Knockhill in a moment. We have, for example, a world-renowned auto-cross event that is held annually in Fort William, which attracts a top-quality field from Europe and America.
Scotland—as even I knew—has a long tradition of success in motor sport at both national and international level. In formula 1 racing, to which the hon. Lady referred, I remember very well Jim Clark being the world champion in 1963 and 1965; Jackie Stewart held the same title in 1969, 1971 and 1973.
More recently in formula 1 racing, there is David Coulthard, whom I thought was from the constituency of my right hon. Friend the Member for Dumfries, but when I asked earlier today, I was told that he lives in the constituency of my right hon. Friend the Member for Galloway and Upper Nithsdale (Mr. Lang). David Coulthard's success in winning his first grand prix at Estoril in Portugal during this season, which has just finished, sets him up on a very promising motor racing career. I am sure that the hon. Lady will join me in wishing him every success with his new team, McLaren.
In the 1960s, Scotland had it is own motor racing stable. I am not sure whether the hon. Lady is old enough to remember Ecurie Ecosse, but I certainly do, and the driving at Le Mans and the successes that it had over those years. It helped to develop many budding young drivers, such as Jim Clark and Jackie Stewart. In the past few years, we have also seen Colin MacRae, who has been highly successful in motor rallying. He won the Royal Automobile Club rally in 1994 and earlier this year became the first British competitor to win the world rallying championship; he won it in a nail-biting climax in the Network Q RAC rally, showing tremendous skill and courage to come through an arduous final stage. Another Scotsman, John Clelland, this year won the British touring car championship, to add to his previous title won in 1989.
I think that 1995 has been a tremendous year for Scottish motor sport. I cover all this to provide a backdrop to today's debate, to emphasise the importance of sport, particularly motor sport, within the Government's wider priorities, and to stress that the future of Knockhill race track, which is the issue that we are addressing today, has indeed been carefully considered.
The hon. Lady clearly and ably set out her concerns for the future of Knockhill; she has previously raised those concerns with me in writing. I wrote to her on 14 September and 12 December, explaining the situation with regard to the proposed development at Forrestburn.
Like my right hon. Friend the Member for Dumfries, I am well aware of the success of the Knockhill race track in recent years. It has attracted top-level competition to the site, and has diversified its interests into other areas. I gather that it also carries out test circuit work for prominent motor companies. As the hon. Lady said, it is an excellent example of the benefits of private sector investment in sport. I join her in commending Derek Butcher for his success with Knockhill, which is currently recognised as the country's national centre by the Scottish Motor Sport Federation. 1509 I listened carefully to the concerns expressed about the proposed development of a new motor-racing circuit at Forrestburn in Monklands, and its potential impact on Knockhill. The hon. Lady pointed out that the Forrestburn project would receive financial support from public sector bodies—Monklands district council and Lanarkshire development agency—as well as from the European regional development fund. I understand that the concerns expressed about the potential displacement effect of the new race track on Knockhill have been carefully assessed by the funding partners.
The hon. Lady quoted from a letter from Scottish Enterprise, dated 27 October. I, too, have a copy of that letter. She also referred to a later letter dated 4 December, which states:
Further to my letter of 27 October, I have now had the benefit of discussion with the Lanarkshire Development Agency from which I learned that a displacement analysis had indeed been undertaken with regard to the project.The decision to proceed by Lanarkshire has been taken within their authority and following proper analysis. Accordingly, Scottish Enterprise does not consider it appropriate to intervene in this matter.The letter finishes with an apology for the fact that
the above information was not fully available at the time of my earlier letter.I, too, apologise for the fact that the first letter from Scottish Enterprise to the hon. Lady was not fully informed. Earlier correspondence relating to Scottish Enterprise had made it clear that a displacement analysis had been carried out.The proposed facility at Forrestburn is on a completely different scale from that at Knockhill. The Forrestburn circuit will be 3.2 miles long, which makes it as long as Silverstone and longer than Brands Hatch. It is well above the threshold for international racing events. The Knockhill circuit is only 1.3 miles long. I understand that the Forrestburn promoters intend to develop a circuit of international standards that would secure an FIA licence, which would allow events of international status to take place in Scotland.
I believe that the promoters of the Forrestburn facility will seek to attract such events as the British formula 2 and 3 championships, the German touring car championship and the FIA formula 3000 international championships. The hon. Lady will note that I have left out the formula 1 championship. I understand that it has not been included in the promoters' proposals; I suspect that they are being realistic about what they can achieve.
None of the events that I have mentioned is the kind that Knockhill would be able to attract. On that basis, it seems that the two facilities are considering essentially different markets, and accordingly the development of Forrestburn is unlikely to have an adverse impact on Knockhill. Indeed, the Forrestburn track is expected to bring new opportunities for co-operation with—for example—Knockhill through championships and back-to-back events. One of the wider attractions of Forrestburn is its potential to generate further interest in motor sport at an international level, and thus to expand the overall market, in which Knockhill will continue to play an important part.
As I have said, the Forrestburn project has secured funding from Monklands district council, the Lanarkshire development agency and the European regional 1510 development fund, but it would be wrong to describe it as a public sector project. The vast bulk of the finance is coming from the private sector; the public agencies are very much in a minority supporting role.
I understand—this will interest the hon. Lady—that the Forrestburn project has secured the support of the RAC Motor Sports Association and the Royal Scottish Automobile Club. Both bodies have emphasised the importance of Knockhill in Scottish motor sport, and clearly do not regard Forrestburn and Knockhill as competing facilities.
I understand the hon. Lady's reservations, expressed today and in letters that she has written. I am no expert on motor sport, and I suspect that the same applies to the hon. Lady, but I suggest that the RAC Motor Sports Association and the Royal Scottish Automobile Club are experts. I urge the hon. Lady to seek an early meeting with those organisations, and to try to understand why they consider the two projects complementary rather than adversarial.
§ Ms Rachel SquireI shall take the Minister's advice, and seek meetings with those two organisations. I am, indeed, no expert on motor racing, although I share my London flat with a woman formula 3 racing driver, which gives me a certain insight into the subject.
I was not claiming that no displacement analysis had been carried out; my point is that that analysis has not been as detailed and thorough as it should have been, and has not involved all the interested parties sufficiently.
I understand that Knockhill involves formula 3 racing. I know that a longer track is being promoted at Forrestburn, but I gather that shorter tracks have distinct advantages, in that they allow spectators to see far more: the cars come round even faster.
§ Mr. KynochI am pleased to learn that the hon. Lady shares a London flat with a young lady who is involved in formula 3 racing. Some claim that I can remember being a member of Bristol university's motor club and winning a rally. Perhaps I was wrong to say that I knew little about motor sport, but I must confess that I am a little rusty.
The hon. Lady asked whether a full displacement analysis had been carried out. That is a matter for the funding bodies—and Strathclyde European partnership, the tourism advisory group, the Lanarkshire development agency and Scottish Enterprise are indeed satisfied that the displacement issue has been dealt with adequately.
People in Fife are bound to disapprove of the project until they see that it will increase the inflow of motor sport into Scotland to their possible benefit. It might be helpful, however, if the proprietor of Knockhill talked to the project team at Forrestburn. I cannot bring that about; I can only urge the hon. Lady to suggest that Mr. Butcher in Knockhill try to establish contact. When the project is completed—if it is completed—there may well be a working relationship allowing discussion. If, as I am assured, the two facilities will not be in competition, let us ensure that the relationship is established on an informal basis at a fairly early stage. That could allay some fears. I suggest, however, that the hon. Lady contact the two bodies that I mentioned earlier.
Other than Knockhill, Great Britain has no proper motor sports venue further north than Oulton park in Cheshire. Given the potential catchment area of Scotland 1511 and much of the north of England, there is no reason why the motor sports market should not be able to support more than one circuit. That was certainly the case in the 1950s and 1960s, when Scotland had a number of successful circuits—for example, at Charterhall, Turnberry and Crail.
Given the resurgence of interest in motor sports—encouraged by the success of David Coulthard—I believe 1512 that it is a growing business. I consider that the question of displacement has been properly investigated by the bodies concerned, and I see no justification for Government intervention.
§ It being Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.
§ Sitting suspended, pursuant to Standing Order No. 10 (Wednesday sittings), till half-past Two o'clock.