Transport, Infrastructure and Climate Change Committee, 02 Oct 2007

Meeting date: Tuesday, October 2, 2007

Official Report 267KB pdf

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Finance and Sustainable Growth

Good afternoon. I welcome everybody to the sixth meeting in 2007 of the Transport, Infrastructure and Climate Change Committee. I ask everybody present to ensure that mobile phones and any other wireless devices are switched off.

The Cabinet Secretary for Finance and Sustainable Growth has agreed to answer our questions today. He is joined by Malcolm Reed of Transport Scotland; John Ewing, director of the Scottish Government Transport Directorate; and Philip Wright, a deputy director of the Scottish Government Climate Change and Water Industry Directorate. I welcome all our guests and ask John Swinney whether he would like to make any opening comments.

Thank you for the invitation and for introducing my team, which reflects the respective areas of the committee's remit.

I have responsibility for transport, infrastructure and climate change because the Government has brought together those areas of responsibility to establish clearly the connection between them. We view it as an opportunity to ensure that we have the most effective cross-working at policy-making and delivery levels in the Scottish Government and externally. I look forward to working with the committee, my officials and Stewart Stevenson, who has significant policy responsibilities in transport, infrastructure and climate change. We discussed at the committee's away day where the Government can address issues of relevance to the committee.

The Government takes the view that climate change crosses political boundaries; it affects every one of us and every political dimension of the debate. Therefore, we are keen to have a dialogue with the committee on a range of issues to support our efforts to tackle climate change. I have made clear to the convener my willingness to discuss with the committee issues in connection with the proposed climate change bill and to ensure that the Government and Parliament make progress in considering the legislation on climate change that is developed during the period ahead.

In my climate change statement to Parliament back in June, I acknowledged the significant work that had been undertaken by the previous Administration in laying the foundations for tackling climate change. I look forward to building on that work through the climate change bill. Among the work that we inherited from the previous Administration was the national transport strategy, which was published last November. Production of that document involved extensive consultation relating to several issues that will be of significance to the committee in addressing a range of priorities in this field. Those issues include reducing emissions; ensuring that we develop a public transport infrastructure that improves quality, accessibility and affordability; and tackling connectivity in Scotland.

As the committee knows, the Government operates on the basis of five strategic objectives, the interlinked themes of which are: wealthier and fairer, safer and stronger, greener, healthier, and smarter. We are determined to bring forward policy measures that fit into those areas to reflect the balance of policy choices that have to be made to support the Government's purpose and work.

Obviously, the committee will take a close interest in the Government's decisions on the comprehensive spending review. I am sure that we will address those issues in due course. The Government is undertaking work on the spending review to ensure that the five strategic objectives are reflected in our spending decisions. That will ensure that our policy initiatives and spending commitments are truly and properly aligned in order to support our purpose and all our work.

Thank you.

The committee is still a wee bit concerned about some of the events of last week. I have one or two questions to put to the cabinet secretary and Malcolm Reed, as a wee refresher.

We invited Transport Scotland to give evidence on the Abolition of Bridge Tolls (Scotland) Bill, but that did not happen, for one reason or another. We have received a letter of apology from each of you, with the reason given as either a breakdown of communication or a mistake. The initial explanation that we were given was that it is for Scottish ministers to decide which officials will represent them at committee. I seek clarification on the matter.

My first question is for the cabinet secretary. Was no approach made to Scottish ministers to ask whether you were content for Transport Scotland to appear at committee?

That is correct.

My next question is for Malcolm Reed. How did this unfortunate breakdown in communication happen?

If I may, convener, I repeat my apology.

My impression was that the matter was still under discussion between our two offices. In fact, in view of the discussion, I had not realised that the invitation still stood for the date in question. It was only very late on Friday that I became aware that I was expected to appear before the committee on the following Tuesday. Frankly, that did not give me an opportunity to discuss it with ministers or to do any necessary preparation.

I am sorry, but are you saying that the initial acceptance had been a mistake?

No. I am sorry; I am not saying that. We had received a letter from the committee clerk and the invitation was still being discussed informally between our two offices. My understanding was that we had neither accepted nor declined the invitation. Certainly, at that point, we had not taken it to ministers.

In view of the number of issues for discussion today, I do not want to labour the point. However, I seek an assurance that when, in future, the Transport, Infrastructure and Climate Change Committee pulls out a chair for Transport Scotland, Transport Scotland will sit on it.

In my letter to the convener of 27 September—I am sure that it will have been issued to members—I said that I want Transport Scotland to have the fullest involvement in the work of the committee. I also want that from all the officials who are involved in this area of policy activity. I assure the committee that that will be the case, at all times. The type of discussion that has been held to date, such as that which took place between Malcolm Reed and the committee at your away day in the summer recess, is indicative of the Government's determination to ensure that our officials are fully engaged in the committee's work. I give you that assurance.

I understand that another invitation has been extended to officials to give a further briefing on the replacement Forth crossing. I also understand that Transport Scotland either has indicated or will indicate that it is happy to provide further information and briefing to the committee and to discuss any relevant issues. Obviously, some issues will sit pending a ministerial decision. However, in the context of those parameters, I am very happy for officials to be fully involved in the committee's work. I give you that assurance.

I am very grateful for the assurance.

One issue on which the committee had indicated a desire to hear an answer from Transport Scotland before our final evidence-taking session on the bill later this afternoon is whether it had conducted an independent assessment of the impact of removing the tolls, aside from the toll impact study. I put the question to Malcolm Reed.

We have conducted no separate investigation of the impact of removing tolls.

So the toll impact study as it stands is the state of knowledge on that question.

Yes.

My questions are for the cabinet secretary. Given the Government's announcements last week and Thursday's vote in Parliament, I am interested in how you plan to consult people about the plans to replace the Edinburgh airport rail link and involve them in taking those plans forward.

The Government has been involved in a wide range of discussions with stakeholders in the preparation of the plans that we announced to Parliament last Thursday. Over the past few years, there has been extensive discussion about the options that existed in respect of the possibility of a rail link to Edinburgh airport, and a number of options have been considered during that period. The proposal that the previous Administration put forward, which was supported by the previous Parliament, was the subject of extensive parliamentary scrutiny. I was pleased that Parliament supported the proposals that we announced on Thursday.

We intend to take a prompt approach to the implementation of the proposals. We will have to acquire certain consents to take them forward. Some of those consents will relate to the location of the Gogar station and others will relate to the establishment of the Dalmeny chord, which will form a link between the Fife line and the Glasgow line at the Winchburgh site. In addition, there will be discussions with stakeholders and communities about how we ensure that the transport connections that we put together—a formidable number of enhancements to transport connections will arise from the Government's proposals—can be taken forward to best suit the needs and aspirations of other communities. I am thinking in particular about communities in which we can expand the connections to destinations in and around the area that the network will serve.

Will there be a full consultation prior to moving forward? You spoke about trying to move fairly quickly. Can you indicate a timescale?

As I told Parliament, I want the Gogar station to be operational at the same time as the trams become operational, to provide a link to Edinburgh airport. I want to take steps to ensure that that element of the programme takes its course as early as possible to ensure that we have that connection up and running at as convenient a date as we possibly can, and certainly on the same timescale as the trams.

On the wider issues, we will have specific discussions with surrounding communities. Our objective is to complete the discussions as quickly as possible.

I have a question about concessionary bus travel. As you are aware, people aged 60 and over and disabled people can have a pass that gives them free bus transport throughout Scotland. A lobby in favour of community transport feels that people who have a disability, or older people who are frail and less able to go to bus stops, are discriminated against. Will you consider including community transport projects in the free transport model?

I recognise the problem that you highlight and acknowledge that it affects people in our society. I am prepared to consider whether such provision can conveniently be added to the concessionary travel scheme. I am happy to examine the issue with Stewart Stevenson and will respond to the committee accordingly. We must be mindful of many logistical issues related to the concessionary bus scheme, but we can certainly give an undertaking to consider that point.

Thank you. I welcome that.

Cabinet secretary, you said that you had had extensive discussions with a wide range of stakeholders about your new proposals for EARL. Did you discuss the matter with the City of Edinburgh Council?

To my knowledge, the discussions that we had did not include the City of Edinburgh Council. However, they included Network Rail, BAA and TIE, which, with the development of trams in Edinburgh, is obviously significantly involved in transport issues.

I would have thought it unlikely that you would have been able to carry out any appraisal of your new proposals under the Scottish transport appraisal guidance process. Will you advise me in that respect?

A STAG appraisal was undertaken on our proposals.

What stage did it reach?

Stage 1.

That is a fairly light appraisal.

Nonetheless, it is a STAG appraisal.

And you will progress the appraisal through its further stages.

Of course.

What will you do if, as the project is developed, it becomes clear that its benefits are not as good as those of the existing project?

The Government has decided to change direction on its project, and now—if I can use this pun—we have to decide on our direction of travel in that respect. Parliament has consented to our decisions and I assure the committee that we will take forward our consideration of the new proposals for the Edinburgh airport rail link in a way that is consistent with the STAG appraisal regime. Indeed, one of the key points of our proposals is that we will seek to ensure that we leverage out as many benefits as possible into other connections. Thursday's statement outlined a range of very positive measures with the possibility of enhancing connections from the north, the east, the west and the south of Scotland, and we will take forward our proposals in that context to ensure that they deliver a strong group of connections.

I have a couple of questions about the new Forth crossing. First, on the timescale for decision making in ministerial statements, I presume that when you make a statement on the matter you will confirm that you will go ahead with an environmental assessment on the new crossing under the Environmental Assessment (Scotland) Act 2005.

Perhaps I should just throw my other questions at you. What are your current estimates of the cost of a new Forth crossing? Some of our witnesses have put the figure as high as £2.3 billion at 2006 prices, which is clearly a very large sum. Are you confident in your Government's ability to manage such a huge project on cost and on time? After all, there have been hiccups with other projects, including, as Alison McInnes pointed out, the EARL project.

One major question, of course, is how you will fund the crossing. Have you ruled out all private sector involvement in the new bridge? Are you considering bond funding, which I believe will require permissions from Westminster? Will you look at shadow tolling or direct grants? Have you explored whether any European funding such as European regional development funding or trans-European network system funding is available? My understanding is that ERDF, in particular, is fairly tight for such projects.

Finally—I apologise for asking so many questions—I assume from previous comments that you are not looking to introduce tolls on the new bridge; after all, that would not be consistent with your current approach. Can you confirm that assumption?

Finally, will you use your current power to vary tax rates by up to 3p, which, of course, you can do without reference to Westminster and without needing any further funds?

The member asked a number of questions, many of which were prefaced with the word "finally".

There certainly were a number of questions to respond to.

Over the summer, we considered further the options for the Forth replacement crossing. In that respect, I was delighted that the public very much supported and engaged with the exhibition on the various proposals, which was held in a number of venues in the affected areas. Two options—a replacement bridge or a tunnel—have been discussed, and you are absolutely right to suggest that we will undertake a strategic environmental assessment under the terms of the 2005 act.

The cost could be of the order of £3 billion. However, the Government has yet to decide on the type of crossing that will be built and the method of financing. Those decisions will be made during the autumn so that we can make early progress on the replacement crossing and avoid having a question mark over the existence of a Forth crossing in the future. Obviously, the crossing is a major artery that connects different parts of Scotland.

A number of Mr Stewart's questions relate to the method of financing. I am simply not in a position to give definitive answers on that. Information will be reported to the Parliament in a statement in due course, and I will be delighted to come back to the committee after that statement to answer any further questions that you have.

I understand that you cannot give us chapter and verse on every aspect of the funding, but £3 billion is more than I thought the cost would be. Obviously, it is a tremendous sum.

I have two further questions. First, given your policy on the Forth and Tay road bridges, I presume that you will not toll the new crossing if it is a bridge. Secondly, have you ruled out any private sector funding in the financial package for the new crossing?

I return to what I said in my earlier answer. It would be premature for me to comment on the funding mechanisms. I will be happy to come back to the committee to explain further when we have reached our conclusions and made a statement to the Parliament.

I apologise for not answering your question about whether we expect to bring in the project on budget and on time. Of course the Government expects to do exactly that.

Can I quote you on that?

You most certainly can.

What responsibilities will be delegated to Transport Scotland in relation to this major project? Will you provide the committee with some details of the multimodal element of the new crossing?

Your first question raises an important issue that I touched on in my speech in the debate in Parliament last Thursday. With such major projects, we have to ensure that the governance arrangements are crystal clear at all stages. That was the most significant point in the Auditor General for Scotland's report on the EARL project. As I said on Thursday, I reflect that the lack of clarity in the governance of the Stirling-Alloa-Kincardine development was a major contributor to the cost and programme problems in that project.

Transport Scotland's role in the replacement Forth crossing will be as the client. It will act on the Government's behalf to procure the crossing. In that sense, it will be responsible for protecting the public's interest, notwithstanding ministers' responsibility for Transport Scotland. In designing the project, we will look to ensure that we make the governance arrangements crystal clear at the outset. Again, I will be happy to examine the governance arrangements with the committee so that it has confidence in them. If we get the governance correct at the outset of a project, the uncertainties that exist later will be dealt with much more easily.

Whether the development is a bridge or a tunnel, it will have to have a multimodal element within it. We are still considering the format of the multimodal arrangement, which will be a material consideration in the Government's decision, and we will report to the Parliament in due course.

I have a question on the plans for the existing crossing. Where is the knowledge at in relation to the costs and feasibility of replacing the cables and safeguarding the future of the existing bridge?

An exercise is on-going to assess the condition of the cables and the remedial action that can be taken to protect them. It will be some time before there is clarity on the impact and effectiveness of that work. We will pay careful attention to the outcome of that investigative work.

It is rather early to give a definitive position on the renewal or replacement of the cables, because we do not have a full assessment of the nature of the problem. There is a question about the long-term reliability of the bridge in the years to come, and we need to take action to ensure that there is a crossing at that stage that will guarantee that connection as an important journey point in Scotland.

The Forth Estuary Transport Authority is in the lead on this work, but it is keeping us informed. The cabinet secretary is right—FETA put in place a system of monitoring, and only over a period of months and years will that monitoring reveal how effective the dehumidification of the cables is.

This is a new branch of engineering. There is worldwide recognition that the condition of suspension bridge cables is a problem, so there is a concerted effort throughout the world—in America, Japan and elsewhere—to come up with new technologies. I would be very surprised if solutions do not become available in the next 10 or 15 years that are not available at the moment. It is a very exact science. There are probably grounds for being a little more optimistic than we were 18 months ago, but beyond that I do not think that we can be more definite.

We will leave that there as we are becoming pushed for time and members have questions on other transport projects.

You will be aware that there was a members' business debate in the chamber recently on the Aberdeen western peripheral route. Various campaigners on the issue had been raising questions about the cost, and about the public local inquiry process that may be ahead. First, on cost, what is your expectation of the budget for the AWPR, based on United Kingdom figures for the average price of building a mile of road and what we know about the existing commitments within the budget? Are the campaigners right that the figure is likely to rise to more than the ball park of £600 million, or is the current cost estimate reliable?

We currently estimate the project outturn cost to be in the order of £295 million to £395 million. Those are the costs that we have reported to Parliament.

Are you confident that they will not rise?

I would be confident that those costs would not rise.

I want to raise another complaint, I suppose, that has been made about the process. The environmental statement has had to be republished, and although the £500 that people have to spend on it might be trivial in terms of the Scottish Executive's transport budget, it is a significant cost for an unfunded community group to have to meet for a second time. Can the Government do anything to ensure that people have access to such information without having to spend additional money?

I will look into that point, see whether we can make access more convenient, and report back to the committee.

In the previous session, I sat on the Airdrie-Bathgate Railway and Linked Improvements Bill Committee, which was very interesting. There was a strong lobby for additional stations at Plains and Caldercruix, and a strong recommendation from the committee that the Parliament agreed with. Can you update us on where we are with that?

Feasibility studies have been completed on stations at Plains and Blackridge. An updated report on Plains is imminent, and the Blackridge station point is being continued.

In last week's ministerial statement on rail links to Edinburgh airport, reference was made to various improvements to rail connections between Glasgow and Edinburgh. In that context, can you comment on the possibilities for speeding up rail journeys from south-west Scotland—for example, from Stranraer, Ayr or Prestwick airport—not just to Glasgow but to Edinburgh and beyond? As I understand the aftermath of last week's debate, there will be improvements to the number and size of trains from Glasgow Central station to Edinburgh, which could go via Shotts and/or Carstairs. Is that the best that people in south-west Scotland can hope for in rail connections to Edinburgh?

Last week, the Government set out a number of measures that will improve the journey between Edinburgh and Glasgow. Those measures will include, first, an increase in the number of connections that it is possible to secure from different locations, whether that means starting from Glasgow Central or Glasgow Queen Street.

Secondly, there will be a number of measures to improve the connectivity of some of those journeys so that it will be possible for people to get on a train in Glasgow and get off at Edinburgh Park or the new Gogar station to get connections to Edinburgh airport, which I suspect will be welcomed by many. Thirdly, there will be a series of different measures with the objective of reducing journey times between Edinburgh and Glasgow to as low as 35 minutes. We are bringing forward a number of material improvements on different routes to try to improve connectivity.

There are clearly other issues in relation to connections from Ayrshire and the south-west to and beyond Glasgow Central. If I was a betting man, I would suspect that that takes us into the sphere of Glasgow crossrail.

That would be relevant if we were discussing a direct service, but at the moment, we are still talking about changing at Glasgow Central.

The improvements that we are putting in place to the connections from Glasgow Central to Edinburgh will be a welcome boost for people who are trying to get from the south-west to the east of Scotland. The Government will take forward those initiatives to try to improve the connectivity to suit the best interests of people in those areas.

You mentioned crossrail before I did, cabinet secretary. You may also have mentioned a concept known as the Caledonian express, which involves the re-laying, resignalling and electrification of the line from Glasgow Central to Edinburgh via Shotts. In that scenario, the journey time via Shotts could be brought down to one hour. I presume that your thinking is that that would only match the journey time from Glasgow to Edinburgh via Carstairs and that the Government's position is that people who want to get to Edinburgh from south-west Scotland will have to change at Glasgow Central rather than go over to Glasgow Queen Street.

If we consider the differences in train journey times from south-west Scotland to Edinburgh via Glasgow Central station or via Glasgow Queen Street station, we can see that there is not an awful lot in it, given the transfer time in Glasgow—we are talking about journey times of the same order. Of course, we want to improve journey times on all connections, and some journey times will reduce significantly on the Queen Street to Edinburgh Waverley station connection. We are trying to produce a range of options, so that members of the public can choose how they travel through central Scotland.

Are you ruling out at this stage direct links from south-west Scotland to Edinburgh?

We have put forward a range of measures that will significantly enhance connectivity between Edinburgh and Glasgow. There is much to be positive about in that regard, and I am sure that the connections will be welcomed by people in south-west Scotland.

Will the cabinet secretary update us on the Scottish Government's approach to the spending review and the preparation of the Scottish budget on transport, infrastructure and climate change? What budget priorities are emerging?

A number of budget priorities are emerging—

They cannot all be priorities.

As you know from the statement that I made in the Parliament in June, we expect to receive the output of the comprehensive spending review—the document that we must await before we can determine our spending priorities—in the week beginning 15 October, although we might receive the information earlier than we predict. When the information is to hand, the Government will undertake an exercise to take final decisions on the shape of our priorities before laying our budget before the Parliament—ideally within about a month of the comprehensive spending review becoming clear. The timetable that I agreed with the Finance Committee for the consideration of the budget will allow committees of the Parliament the customary two months to consider relevant portfolios' spend.

On the Government's priorities, members are familiar with the Government's five strategic objectives, which I set out in my opening remarks. The objectives structure how we make decisions on policy and budget priorities and will be very much to the fore in our consideration of our priorities on transport projects, infrastructure and climate change, which are relevant to the committee.

David Stewart mentioned funding methods. Can you say what proportion of transport projects you expect to fund from the Scottish futures trust? Will public-private partnerships or other funding methods be involved?

A growing proportion of projects will be funded through the Scottish futures trust mechanism, which we envisage as an efficient and affordable method of funding some of our capital projects. The approach does not apply just to transport projects; it stretches right across the Government and applies to our work on schools, hospitals, waste management, water infrastructure and prison infrastructure.

There will be certain projects that started as PPP projects, which, if they are at an advanced stage, could be affected by the redirection of their structure. We have taken pragmatic decisions on a couple of projects and I am sure that we will continue to be pragmatic. However, our expectation is that the Scottish futures trust will be a competitive mechanism in the marketplace and as a consequence will attract the lion's share of investment.

I am fully aware of the criticisms that you and others have made of PPPs, but you must concede that the PPP model—or its predecessor, the private finance initiative—has been extremely good at ensuring that projects are completed on time and on budget. How will your proposed alternative work in the marketplace in that respect? Could introducing novel funding arrangements for major funding commitments such as the new Forth crossing or the Aberdeen western peripheral route put those projects at risk or call into question the ability to complete them on time and on budget in the way that PPPs managed to be completed?

A number of commendable projects that were achieved under conventional borrowing mechanisms have been completed on time and on budget. The idea that conventional schemes all come in over budget and that PPP schemes come in on budget is a myth.

One lesson that has emerged from our experience of capital investment over the years is that project management and governance can have as much to do with how a project performs as does a project's method of financing. That relates to my answer to Alison McInnes earlier. I am absolutely adamant that we will get the project governance structures and controls correct, so that we can deliver projects on time and on budget. The critical element is that we have arrangements in place to have reliable control over projects and budgets and to ensure that projects are delivered on time and on budget.

In your opening statement, you referred to the acknowledged link between climate change and transport. Environmental groups have expressed concerns about the decision to abolish tolls and about the replacement Forth crossing. Given that, will you assure us about where climate change fits with Government decision making in general and, in particular, in relation to larger-scale transport projects?

The First Minister took a set of decisions that resulted in drawing together transport and climate change in one ministerial portfolio—the overall economic portfolio. That shows the significance that we attach to ensuring that the challenge of securing an appropriate relationship between transport priorities and climate change necessities lies at the heart of how we take our decisions. That framework provides a strong system within which to take decisions about such matters.

The Government has announced several activities in relation to climate change. We have signalled our intention to introduce a climate change bill, which will include annual targets for emissions reductions that are binding on the Government. That will be a formidable factor in the Government's policy making. I put on record our determination not to wait until that bill is enacted before we take steps in that direction. We will start to take steps immediately to tackle carbon reductions.

The Government made an announcement last week on transport projects. We will make a formidable investment in rail projects and rail developments that I think will be warmly welcomed as a commitment to improving the opportunities for individuals to access the public transport network properly and in an environmentally sustainable fashion. That is just one illustration of how the Government intends to develop its priorities.

People are still concerned about the forecasted traffic growth. We welcome the commitment that you have given today, but can you give us more details on how the Government will deal with the forecasted traffic growth and on its commitment to public transport in general?

Significant investments in public transport infrastructure are identified in some of the measures that we announced through the statement that Stewart Stevenson made to Parliament on 27 June and the statement that was made last week on transport projects. We can also take forward some smaller projects that will assist the increase in modal shift from car use to public transport use. Such projects include the provision of park-and-ride facilities—which are enormously popular—around some of our cities and larger communities, and the steps that we can take to improve the attractiveness of public transport journeys and the integration of those journeys.

Last week, I was slightly criticised for the fact that the Government was relying on the tram network to provide a connection to Edinburgh airport. I thought that that was a tad unreasonable. There was I, a sinner who had repented, incorporating the tramlines into our wider public transport infrastructure, which I thought was a welcome step.

Other initiatives that we would like to press ahead with, about which I had discussions only yesterday, are to do with encouraging flexible working. By adopting flexible working approaches, we can reduce the journeys that public sector employees have to make to their places of employment. I was shown some attractive examples from the private sector of where encouraging flexible and home working had successfully reduced organisations' carbon footprints. As we set out in our manifesto, we intend to explore such issues as an integral part of our approach.

Cycling and walking are often forgotten about in these discussions. As well as improving public transport, is the Government committed to improving the cycle network and encouraging cycling for shorter journeys?

One of the consequences of my ministerial office is the fact that I have been on my bike fewer times in the past few months than I would have liked. I think that there is an enormous opportunity to assist the development of the cycling infrastructure, and that will feature in our plans.

I must ask you to keep your answers brief from now on, cabinet secretary.

I want to ask about the Scottish Government's tier 3 rail projects. What work is the Scottish Government doing on the proposed upgrade of the Perth to Inverness rail line?

Enhancements to deliver an hourly, faster service between Edinburgh, Glasgow and Inverness through Perth are incorporated into the rail utilisation strategy that the Government has published. We are considering specific proposals to remove certain obstacles to achieving enhanced journey times, which we will take forward as part of the programme of activities that we have set out in the list of tier 3 projects.

Is the signalling system on the railway part of that work?

Yes.

How will the uncosted tier 3 projects be taken forward? Will they be included in the current strategic transport projects review?

When we published our high-level output specification document in the summer, the Government was commended in The Herald—of all places—which said:

"the blueprint addresses the needs of areas such as the Highlands and the Borders as well as the central belt, and this is a cause for optimism."

That was a heartening reaction to our proposals.

We have submitted the HLOS document to Network Rail, which is formalising its response as part of its strategic business plan. That will be considered by the Office of Rail Regulation and, as a consequence, the investment period, which commences in 2009, will be able to take its course.

I am sure that we will have more time to speak about those projects in due course.

Turning to the islands and the Caledonian MacBrayne contract that was agreed, does the cabinet secretary have any plans to review the procedure that was followed in that exercise and to consider whether a different approach might be taken when the contract is next due for renewal?

As Mr Gibson will know, we signed the contract with CalMac Ferries Ltd on 20 September, and it began on 1 October. We will certainly consider the experience of tendering in such a fashion. When we came into office, the Government took the view that because the existing approach to addressing European state-aid issues was at a highly advanced stage, it was best to allow matters to run their course and come to a conclusion to ensure continuity in the development of the Clyde and Hebrides ferry services. However, I will certainly examine previous experience when we determine how to deal with the contract in the years to come.

In due course, will you approach Europe to sound out how we might handle such matters?

Many discussions take place between the Scottish Government and the European Commission on ferries issues.

I will carry on with the ferries theme. I have a few questions on road equivalent tariff, on which we have had evidence from Stewart Stevenson. We are aware of the pilot around the Western Isles. If I remember, Mr Stevenson suggested that up to 69 routes might be involved, including mainland-to-island, inter-island and mainland-to-mainland services. Do your officials have an indication of how much that might cost? Some outside observers have quoted figures of around £200 million. Will local connections be a factor, as is the case with the air discount scheme, to which people who live in the Highlands and Islands have access? Will Shetland get a special exemption, given that it is 200 miles from the mainland? Some critics have said that a RET scheme will not work for areas that are furthest from the mainland, but representatives of the Highlands and Islands, such as Rob Gibson and I, are keen that Shetland be covered by any such scheme. What thoughts have you and your officials had about costs, eligibility and implementation dates?

For all the reasons that you gave, the Government has, in the first instance, established a research study on the roll-out of a pilot. That exercise is under way. We will look to roll out the pilot, which we have said will be on one or more Western Isles routes. I imagine that that will be undertaken towards the middle of next year. Our approach has been designed to examine all the practical issues that are involved in the rolling out of road equivalent tariff. I expect that many of the questions that you have asked will be addressed by the study and the experience of the pilot exercise.

Capacity, rather than price, is one of the biggest issues in ferry services, although both factors come into play. Will you and your officials look closely at capacity in the roll-out of the RET study?

As part of the Clyde and Hebrides ferry services contract, there has been an expansion of capacity on a number of routes, which has been warmly welcomed. There has been particular demand for Islay ferry connections.

The Government's approach, which is shared by Highlands and Islands Enterprise, is based on a desire to increase economic activity in general and to support the process of economic growth. With HIE, we have a shared interest in achieving a formidable expansion of economic growth in the island communities, and the provision of connections is a significant part of making that happen.

The last thing that I want is for capacity constraints to become an obstacle to the development of vibrant economies in our island communities. I know from the communications that I receive from members who represent island communities and from my visits over the summer to Orkney and the Western Isles that capacity and connectivity are significant issues for the prosperity of such communities.

We mentioned climate change policy. Have any additional policy decisions been made about the content of the climate change bill? Will it include measures in addition to targets?

A significant amount of discussion is under way about the process of enacting the bill and consulting on its contents. I expect that there will be provisions that go beyond targets. We will consider a number of other questions in relation to energy efficiency, building standards, energy and heat, waste, the role of public bodies, business issues and transport issues. The Government is involved in discussions with stakeholders on some of those elements. We are conducting our own research on how provisions would contribute to achieving the global targets that the Government has set.

We were previously told that we might see a consultation around the turn of the year. Are you still working to that timetable?

That is correct.

Most of my questions are about commitments that you have already given. However, I also want to know about the UK climate change bill. Will relations between the Scottish and UK Governments ensure that there is good joint working on it?

There has been a formidable amount of contact between our officials and officials in the Department for Environment, Food and Rural Affairs on many detailed operational questions in relation to the UK climate change bill. We want to introduce legislation that contains more demanding targets than those in the UK bill, but we want to work closely with the UK Government on pursuing the issues about which we have shared and equal concerns. There have been a number of ministerial discussions about the contents of the UK climate change bill. The week before last, I spoke to the Secretary of State for Environment, Food and Rural Affairs about some of the outstanding issues, which I am pleased to say look as though they have been resolved. I suspect that the United Kingdom Government will make announcements about that shortly.

You mentioned building standards in your list of things that might be included in the Scottish climate change bill. Would such provisions extend into energy efficiency and microrenewables, or do you see those areas being separate and different from what would be covered in a climate change bill?

I suspected that we might be getting on to that ground, which is precisely why I have indicated to Sarah Boyack, who I know has a close interest in legislation in this area, that I would be happy to discuss with her how the provisions that she proposes to introduce through her member's bill might be best incorporated into the Government's climate change legislation. That will ensure that we have one piece of legislation that sets demanding and exacting targets that can focus policy making and decisions in Scotland. I hope that we can have some constructive discussions on the incorporation of those issues into the Government's wider legislation.

Your remit also includes the planning system. The national planning framework will be of interest to this committee. When do you expect to submit it to Parliament for consideration?

The draft national planning framework will be submitted to the Parliament before the Christmas recess, and there will be further parliamentary dialogue about it. The format that I propose to adopt is to submit the framework to the Parliament, give members an adequate opportunity to reflect on its contents and have a full parliamentary debate on it thereafter.

I thank the cabinet secretary and his colleagues for coming along and answering questions. We will have a brief suspension to allow for the changeover of witnesses.

Meeting suspended.

On resuming—