Hydro operator ‘flabbergasted’ at Scottish Government ‘rule breach’
The boss of a Lochaber business says he is utterly flabbergasted at reports suggesting the Scottish Government was advised its Gupta Guarantee could be in breach of state aid rules yet went ahead anyway.
Scottish ministers were advised last week that their deal with GFG Alliance to save the Lochaber smelter worth £586 million to the taxpayer may have broken the rules as details of the agreement were made public for the first time.
It came as Liberty Steel offices in Scotland were visited by the Serious Fraud Office on Wednesday April 27 as part of an ongoing investigation into alleged money laundering and fraud at GFG Alliance.
The Scottish Government maintains the guarantee agreement was in line with state aid rules and said the value of the securities would ‘more than cover’ the cost of the guarantee.
Hugh Raven, managing director at Ardtornish Hydro in Morvern claims he has lost a fifth of its workforce because of the Scottish Government’s intransigence over state aid rules and has been left in a desperate financial state as a result.
‘On the one hand the Scottish Government’s policy on state aid has cost a fifth of our workforce through redundancy in one of the most remote mainland communities in the finance secretary’s constituency,’ he said.
‘On the other, when it comes to a sweetheart deal with an international tycoon tax exile, it seems no amount of public money is too much – even if it breaks the rules.
‘I have had Scottish Government ministers – including the finance secretary – look me in the eye and say that because of the state aid rules there is nothing they can do to help our innovative renewable energy hydro business. Now to learn that they drove a coach and horses through that very same state aid policy in nearby Fort William is astounding.
‘I’m absolutely flabbergasted to see that they risked over £500 million of public money to help the owner of one of the largest private estates in Europe but denied a small rural hydro scheme assistance because they claim it didn’t fit their interpretation of the rules.’
Ardtornish is thought to be the highest business rate-payer proportionate to turnover in Scotland thanks to a long-running punitive business rates saga for hydro operators. The Scottish Government last year agreed a rates relief extension, until 2032, but while this benefits 95 per cent of operators, Ardtornish is among those whose assistance is severely limited because of state aid rules.
‘There’s a staggering and bewildering inconsistency in the Scottish Government’s business policies and a shocking lack of support for home-grown environmentally-friendly rural jobs like those at Ardtornish,’ added Mr Raven.
Mr Raven has been seeking an urgent meeting with the finance secretary for several weeks but says he has been palmed off with an offer to meet her officials.
He concluded: ‘Kate Forbes is my constituency MSP as well as the finance secretary.
‘The least she could do would be to meet me and tell me that rural hydro jobs are as important as those her ministerial colleagues think they may have saved in Lochaber.
‘We need her help to resolve this crisis – but she seems mysteriously reluctant to even meet a constituent.’