Sunak's Freeports are called Greenports here but there's no difference

Unfortunately, the reality is that freeports – even the so-called green variety – are about providing tax cuts to big business while removing workers’ rights, environmental safeguards and democratic oversight.

This is a tried, tested and failed strategy. One of Thatcher’s first policies was to establish ‘enterprise zones’ – post-industrial areas designated for economic development through the relaxation of planning controls, exemption from certain taxes, and additional fiscal incentives.

Clydebank was the testing ground for the first enterprise zone in Scotland in 1980. Subsidies, in various forms, were provided to firms establishing themselves within the enterprise zone. It was subsequently found that most firms had relocated into the enterprise zone from elsewhere in the west of Scotland, with little increase in employment and no overall benefit to Clydebank.

Callum MacPherson, chief executive of the Inverness and Cromarty Firth Green Freeport (Image: Inverness and Cromarty Green Freeport)

In reality, Thatcher’s enterprise zones cost the public purse £26,000 for every job created.

Fast forward to 2011 and George Osborne introduced more enterprise zones, saying they’d create 30,000 jobs by 2015. They didn’t. By 2013, they’d created around 1,700.

Then in 2016, we repeat the pattern. A relatively unknown MP wrote a pamphlet for a Thatcherite thinktank extolling the benefits of post-Brexit freeports – areas that, although inside the geographic boundary of a country, are considered outside the country for customs purposes, meaning goods can enter and re-exit the port without incurring the usual import procedures or tariffs.

That unknown MP was Rishi Sunak. As Chancellor and subsequently Prime Minister, Sunak has overseen the creation of new freeports, including the UK’s largest freeport Teesworks. Teesworks was mired in allegations of corruption and cronyism, with Tessworks shareholders donating to Tory politicians linked to the project.

This isn’t particularly surprising given that the OECD has found clear evidence that, around the world, freeports are used for money laundering.

History has indeed repeated itself then. But no one is laughing. Least of all workers.

Which brings us to the creation of two new ‘Green Freeports’ in the Cromarty Firth and the Firth of Forth, supported by the Scottish Government and local politicians.

Is there any difference between the UK Freeports and Scottish Greenports? In short, no.

Companies who wish to bid for Freeport status within the Green Freeport zones “may” wish to align to the Scottish Government’s Fair Work First criteria and “may” wish to make commitments on paying the Real Living Wage or recognising trade unions.

However, a scan through promotional documents shows there is nothing unique about descriptions of ‘Green’ Freeports in Scotland, and no mention of workers or climate emissions.

‘Greenports’ it seems are the latest in a long line of Scottish Government window-dressing, trying ingloriously to differ from the UK Government when, in reality, they’re much the same thing. All the worst elements of the UK Government’s freeport agenda remains.

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So why is a tried, tested and failed Thatcherite policy back in vogue, supported not only by the UK Government but by Scottish politicians too?

In some ways this is the product of our constitutional model. The UK Government was preparing to establish Scottish freeports without consent from Holyrood, as most key economic levers relating to customs, VAT, and national insurance are reserved.

Arguably, it is better for Scotland to be in the freeport game than simply allowing investment to flow to sites in the rest of the UK. That said, the Scottish Government is providing its own tax breaks, offering relief on Land and Buildings Transaction Tax (LBTT) for up to five years and providing funding to cash-strapped local authorities who are willing to give businesses relief on business rates.

While the Scottish Government may claim that it is trying to shape freeports imposed upon them by the UK government, this is a devolved tax power being used by the Scottish Government entirely of its own volition.

The implications of freeports are already playing out. The owners of Grangemouth, PetroIneos, have announced plans to close their oil refinery in favour of an import-export hub. Is it a coincidence that this import-export hub will benefit from freeport tax breaks?

Freeports aren’t an isolated project but another demonstration that our governments, at almost all levels, are unwilling to challenge corporate interests. It doesn’t stop there.

Take ScotWind. Essentially the Scottish Government lease out our seabed to multinational companies on the cheap, who then receive UK Government subsidies to produce renewable energy by shipping in offshore wind turbines from the Far East, with limited local economic benefit in the form of green jobs. Rather than joining the race to the bottom on workers’ rights and tax, we need to be exploring democratic forms of public ownership of energy and infrastructure alongside public investment in our ports.

The Irish Investment Bank, Vattenfall, and Orsted – publicly owned entities from the Irish, Swedish, and Danish governments – all hold stakes in Scotwind projects. Yet there is no UK or Scottish equivalent, despite the much-vaunted Scottish National Investment Bank. Public ownership or equity stakes enables greater prioritisation of social objectives like securing a just transition for energy workers and building community wealth across the country.

While we need policy change from above; Scotland’s trade unions won’t wait on change to be handed down from on high. As bad as the Freeports are, rights are a floor for workers, not a ceiling.

If companies are making money from freeports, there are only two places it can go: to bosses or workers. Through organising, collective bargaining and industrial action, workers can demand more of the wealth that they create in our freeports.

Rest assured that Scotland’s trade unions will be doing all we can to make sure workers retain as much of the wealth flowing through Scotland’s freeports as possible. History need not repeat itself. Workers can change the course of history in their favour.

For a change, governments, politicians and the corporate lobby should ensure they’re on the right side of it.