09:30
Under agenda item 2, we will hear from the Auditor General for Scotland on his report entitled “Management of the ScotWind leasing round”, which was published earlier this morning. This is prior to our evidence session on the report, which is scheduled to take place on 1 October. I invite the Auditor General to say a few words about his new report.
Good morning. As the convener mentioned, Audit Scotland published its report on the management of the ScotWind leasing round this morning. There were two main aspects to the audit that we undertook. One was to look at the arrangements that the Scottish Government and Crown Estate Scotland had in place for the award of offshore leasing and, in effect, the use of wind farms on the seabed. We also looked at the arrangements that have been in place since the best part of three quarters of a billion pounds of public money was secured from the leases, and how that money has been used.
In terms of the leasing arrangements, our report found, at a high level, that the Scottish Government and Crown Estate Scotland adopted a longer-term approach that offers the potential for higher rewards but also carries higher risks, as arrangements with developers that hold options to develop the seabed for offshore wind farms are still progressing. We have not yet drawn a value-for-money conclusion and, as we said in the report, it will be a number of years, subject to the sites being fully developed and connected to the grid, before it becomes clear whether that longer-term approach to site development was appropriate. It is very clear that, from the outset, the Scottish Government and Crown Estate Scotland intended this to be a long-term investment in a new industry, with the associated supply-chain benefits. A value-for-money judgment will be one for the years ahead.
The second part of the report explored the use of the moneys. At a high level, there needs to be more transparency about how they are being used. We note that there have been plans for some ScotWind moneys to be used at different points over a number of budget years since the conclusion of the leasing round, but it is only in one financial year that any money has been used. In several years, it had been intended to be used to support the delivery of financial balance for the Scottish Government’s spending plans, but then those plans were changed.
Alongside that, it is important that there is clarity about the intended use of the ScotWind moneys. Initially, it was suggested that they were to support climate and environmental issues but, in the one year when they were used, there were more general applications.
Those are the two main themes of the report: the use of the money and the arrangements for awarding leases to developers. As you know, convener, we very much look forward to engaging with the committee on the report in a couple of weeks’ time.
Thank you very much for your report on ScotWind, which you published this morning, and for speaking to it at this meeting. The Minister for Europe, External Affairs and Energy has reportedly said that the report vindicates the Scottish Government’s approach. However, it is important to put on the record that, as you have said, whether the ScotWind approach to leasing represents value for money will become clear only once it is known how many sites have been developed.
You have, rightly, made clear the calls for transparency and how money raised by the ScotWind leasing round has been and will be spent. I have no doubt that I and other committee members will want to explore issues such as the lack of clarity on whether the £96 million that has already been drawn down by the Scottish Government has been used as intended to support the transition to net zero; the lack of clarity on what the Scottish Government will do with the further £507 million that it intends to draw down by 2031; the extent to which the money has been used to invest as intended versus filling budget gaps; and plans for the establishment of a Scottish wealth fund.
As you have said, this is the public’s money. The public will want to know that the approach is generating as much money as possible; they will also want to know what tangible difference the money will make to their lives. We look forward to hearing from you fully on that on 1 October.