European and External Relations Committee

Meeting date: Tuesday, June 15, 2010

Official Report 348KB pdf

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International Engagement Inquiry

Agenda item 2 is the first session in our international engagement inquiry. The committee will consider a report on international expenditure by the Scottish Government and its agencies that has been drafted by the Parliament’s financial scrutiny unit. The report is included in our papers.

I am pleased that we have with us the authors of the report. I welcome Nicola Hudson, Scherie Nicol and Simon Wakefield from the financial scrutiny unit. Before we discuss the report, there will be a short presentation on its key aspects. Is Simon Wakefield making the presentation?

I will kick off.

Good. I thank you very much for the work that you have done so far for us.

Thank you very much for asking us to come to the meeting to make a presentation.

I am head of the Parliament’s new financial scrutiny unit, and Scherie Nicol and Nicola Hudson are researchers in the team. The financial scrutiny unit was set up in the Scottish Parliament information centre to provide the Parliament, including the committees, with additional financial analysis capacity. It is therefore a resource for members to make use of.

The committee asked us to provide a picture of public spending, from the Scottish block, on international engagement. We considered direct spend by the Government and by public bodies that work in economic development, tourism, education and the arts. We have not covered every item of overseas expenditure; our early analysis indicated that going after individual local authorities and health boards, for example, would probably require a disproportionate amount of effort, so we focused our efforts on the key bigger spenders. We also compared the latest spending with what was incurred at the time of the committee’s previous inquiry into international engagement, in 2005.

Before we go into the figures, I should say exactly what we mean by international expenditure. We have defined it as:

“all spend relating to international activities that is incurred overseas”.

It includes salaries for staff who are located overseas, but not salaries for civil servants who work on international development or European policy and are based in Scotland, for example. It includes the cost of trade missions, but not the cost of Scottish Enterprise staff in Scotland who help companies with exporting, for example.

I will say a quick word on data collection. One of the FSU’s key tasks is to improve the Parliament’s access to financial data from the Government and other public bodies. In this case, pretty extensive discussions, encouragement and clarifications involving more than 100 e-mails and numerous phone calls were required to get the data.

I will summarise the top-line results. We estimate that around £1 in every £1,000 that is spent by the public sector in Scotland—around £30 million—is spent overseas. There was a 54 per cent real-terms rise in international spending over the five years, which is well above the 20 per cent rise in the Scottish Government’s public spending as a whole. The vast majority of that increase is accounted for by two policy decisions: the creation of the Scottish Government’s international development fund in 2005, from which around £5.3 million was spent last year, and an increase in Scottish Development International’s overseas market presence, which involved a £4.4 million rise in costs.

I will hand over to Scherie Nicol and Nicola Hudson to run through the findings in a bit more detail. I should point out that they did most of the work on the study.

Four organisations—Scottish Development International, the Scottish Government, VisitScotland and the Scottish Qualifications Authority—accounted for 90 per cent of the overall spend of £30 million in 2009-10.

SDI, which spent £13 million of the total £30 million, was the largest spender. That is perhaps not surprising because it is Scotland’s body for promoting international trade and inward investment. Over the time period that was studied, its spend increased by almost 50 per cent, wholly as a result of its policy decision to increase its overseas presence by 60 per cent. The number of its offices has risen only from 20 to 22, but the number of its overseas staff has increased from 50 to 80. More than half those new staff are based in its Europe, middle east and Africa region—incidentally, it has just opened a new office in Dubai.

That represents a shift in focus from North America, which used to account for the largest proportion of spend. However, over the period, SDI’s North America offices were boosted by seven staff and its Asian offices were boosted by eight staff.

In addition to SDI’s spend on offices, it spends around a quarter of its overseas budget on marketing and events. That decreased slightly over the period. SDI has cited that that was the result of efficiencies gained from moving from print to online media.

The Scottish Government was the second largest spender. It spent £7.5 million on international engagement in 2009-10, compared with £2 million in 2004-05. Almost all of the new spend is related to the international development fund, which was set up in 2005. As members are aware, that fund focuses on providing grants to sub-Saharan Africa. The international development fund allocation has increased by 180 per cent since its inception. The initial allocation of £3.3 million rose to £6 million in 2009-10, and to £8.8 million for 2010-11. Another significant area of spend for the Scottish Government is on overheads and staff in its overseas offices in Beijing, Washington and Brussels. That spend increased by 39 per cent over the period that was studied; the Beijing office opened in the interim.

VisitScotland was the next biggest spender. It spent around £5.5 million in 2009-10. Almost all of that spend—99 per cent of it—relates to marketing, specifically the international marketing of leisure tourism, which incorporates marketing spend for both the year of homecoming 2009 and Scotland week. Two thirds of that budget is incurred in the European Union, which was also the focus of spend in 2004-05. VisitScotland continues to see the EU as its main growth market. A quarter of its spend is incurred in North America. There are low, but increasing, levels of spending in Asia and the rest of the world. VisitScotland is one of the few organisations that reported a reduction in overseas spend—by 23 per cent—over the period that was studied. It has stated that that was the result of its having taken responsibility for the area tourist boards on 1 April 2005. That has squeezed its spend in other areas.

Finally, the Scottish Qualifications Authority experienced increased spend over the period. It spent almost £2 million in 2009-10, compared with an estimated £0.25 million in 2004-05. That sevenfold increase is associated with increased international activity as a whole, with the SQA having a department entirely focused on that area. The largest spend is on staff, with the SQA having an office in Beijing. More than half the spend is in developing and emerging markets such as Africa, the Caribbean and Russia. It should be noted that overseas income for the SQA has also increased over the period, with income outstripping expenditure in 2009-10 by £500,000.

With regard to the other organisations, the trend has been increasing overseas expenditure. In some organisations, that has been as a result of specific new strategies or policy decisions, but in others the increases have simply been a result of the years that were selected.

Nicola Hudson will give the committee a deeper examination of the spending patterns of all the respondents by region and type of activity.

With regard to the analysis that we undertook by region, we asked the organisations to split their international spending across four specific regions: the EU, North America, Asia and the rest of the world. We found that, over the period in question, international spending had increased in all those regions, although at quite different rates.

In the EU, spending had continued to increase at a reasonably rapid rate—it was up 21 per cent over the period, which is an increase of £2 million in real terms. Although it continues to account for the largest share of international spending, it is a declining share; it is not growing as rapidly as it is growing in other regions. Much of the spending in the EU is accounted for by SDI and VisitScotland, which together account for about three quarters of spending in the EU.

The North American spend experienced slower growth over the period, increasing by only about 7 per cent in real terms, but it continues to account for about a quarter of all international spending, again mostly due to SDI and VisitScotland.

Although the EU and North America continue to dominate international spending, accounting together for about two thirds of it, their dominance has reduced over the period in question, while international spending in Asia and the rest of the world has increased rapidly.

In Asia, around £2 million more was spent in 2009-10 than was spent in 2004-05. Much, but not all, of that expenditure relates to China. Asia still accounts for a relatively small share of expenditure—about 14 per cent of all international spending—but it is growing fast. We are also seeing a much more diversified pattern of expenditure, with many more organisations registering international expenditure in 2009-10. There were about nine organisations involved in the area in that year, compared with only three in 2004-05.

With regard to spending in the rest of the world, the key areas of spending are Africa, Australia, eastern Europe and South America. That broad area has experienced the largest increase in spending in value terms and in percentage terms over the period. It has grown rapidly. In 2004-05, it accounted for only a small percentage of all international spending—less than 1 per cent—but, by 2009-10, it accounted for around a fifth. As in other areas of our analysis, much of that increase is due to the introduction of the Scottish Government’s international development fund. In 2009-10, £5.3 million of spending, predominantly in Africa, came within that category.

However, even if we strip out the international development fund, spending in the rest of the world is still significant, and is growing rapidly. Organisations such as the SQA, VisitScotland, the Scottish Arts Council and Learning and Teaching Scotland have all recorded significant expenditure within the rest of the world region. Essentially, over the period, there has been an increased but more diversified pattern of spending across all the regions.

On analysis of spending by type, we found that the largest share of expenditure related to office costs, overheads and staff costs overseas, which accounted for about 43 per cent of all international spending. However, that varied considerably by organisation. Much of SDI’s overseas costs relate to offices—Scherie Nicol has mentioned its extensive network of international offices—whereas, for the SQA, much of the costs in that category relate to consultancy projects overseas.

10:45

With regard to the smaller organisations, much of the international expenditure of the performing companies relates to overseas tours, and is recorded under the events heading, as is much of VisitScotland’s spending.

A third category—grants—accounts for around 20 per cent, which is a significant proportion, of all international spending. Again, much of that relates to the international development fund. All that is recorded under grants expenditure, with the Arts Council making a significant volume of awards to support international activity.

As we have mentioned a number of times, the introduction of the international development fund had a significant impact on the results. Simon Wakefield mentioned that overall international spending has grown 54 per cent over the period, in real terms. If we take the international development fund out of the figures, the growth is a much lower 27 per cent, which is in line with the overall growth in public spending over the period.

Simon Wakefield also noted that our analysis focused on international spending and the overseas element of international activities, so we have not captured what is spent domestically on supporting those activities. Taking the example of the Scottish Government, we recorded a total sum for international spending of about £8 million in 2009-10. The budget line for international relations is £12 million in 2009-10, so you can see that there is a difference of about £4 million, which will largely relate to activities within Scotland that support international activities.

There has been a significant increase in international spending over the period, but much of that reflects a number of key strategic policy decisions, such as the introduction of the international development fund and the decisions of SDI and the SQA to increase their international engagement.

A number of new programmes and activities have been introduced over the period, such as the fresh talent initiative, the Scottish continuing international professional development programme, which involves visits for teachers, and Highlands and Islands Enterprise’s strategic partnership with Massachusetts Institute of Technology. All those new activities influence the figures.

As we have said, there have been reductions in international spending in some areas, notably in VisitScotland, due to the changing remit of that organisation over the period, and around Scotland week, which was formerly tartan week.

Those are a few highlights from our analysis. We would welcome members’ questions.

Before we move to questions, I should say that I see this as a first discussion on the matter. The financial scrutiny unit has indicated that it is more than willing to go back and examine any element of its analysis in greater detail. The study has been quite a large piece of work, and members might want to consider it as being the top line, in a way, which means that there might be elements on which they want further information. Our international engagement inquiry extends beyond the summer recess, so there will be time to return to the matter. At some point, we will invite the minister to appear before us to discuss the detail and the substance of what the financial scrutiny unit has come up with.

On the SQA side of things, you indicated that the spend has brought revenue into Scotland. Are similar figures available in relation to the international spending of other organisations, such as SDI, which you mentioned had the highest spend? Have you performed any sort of cost benefit analysis in that regard?

That was not within the scope of the study, but we would be happy to examine export and inward investment data to provide you with some information on that.

That would be helpful.

A huge amount of work has obviously gone into the report, and it is a very helpful starting point for the committee. It would be helpful, though, if we could get a further breakdown of some of the figures. For example, we cannot see what is happening with ministerial travel. Moreover, on page 13 of the report you say:

“Of the £7.6m international spend ... Almost all ... relates to the International Development Fund”.

That is clear, but it would be useful if we had a year-by-year breakdown of that because all we have are snapshots for 2004-05 and 2009-10.

On the same page of the report, you say:

“A large proportion of these monies”

in the international development fund

“are given to Non-Governmental Organisations (NGOs) based in Scotland ... however some is also used for other purposes ... Due to the nature in which this fund operates, it is not known what proportion of this funding is spent overseas, relative to how much is spent in Scotland.”

Why cannot we find out that information? How would we go about doing so? Has Audit Scotland looked at any of the figures in relation to SDI and so on?

To be honest, I think that this is the first time the budget has ever been looked at—which is why there will probably have to be a number of stages to this work. You have highlighted quite a few aspects. Perhaps Simon Wakefield can clarify or comment on some of them.

With regard to ministerial travel, our report is really a high-level overview, so it would probably require another report to get that kind of breakdown and get into that level of detail. When we tried to clarify that issue with the Government, it said that it submitted information on the running and programme budgets from its international relations and major events budget, which included running costs for the offices overseas, but not ministerial travel. In other words, ministerial travel would be in addition to that.

Right.

That said, those figures are published on the Government’s website and the latest set, which is for 2008-09, indicates that the total cost of ministerial travel overseas was £92,000 for 59 visits. Obviously we are happy to get more information or drill down further into the figures that we already have.

I think that Rhona Brankin is asking for a timeline rather than the two figures for 2004-05 and 2009-10. It would also be useful if, in addition to the very clear breakdown of grants that you have already provided in the report, you could indicate how much of that money is allocated to consultants.

In the executive summary of your report, you say that although SQA spend has increased,

“it is worth noting that”

the organisation’s “international activity” actually brings in an income. However, I am slightly surprised that there is no similar reference in your comments about SDI, whose clear remit is to promote inward investment. Why have you not included anything about that in the report?

That is because it is not direct income for SDI; rather, it is all about gross value-added impacts on the Scottish economy. SDI is developing ways of measuring the impact of inward investment and we have data on exports and the number of inward investment projects, but—as I said—that is not specific income for the organisation, but represents overall economic benefits for Scotland. I am happy to follow up the data on that matter. I have more information on that.

That it is not specific income for SDI is a fair point to make. However, if you have figures for the inward investment that SDI has achieved it is only fair to present them as a reflection of the return that the organisation gets on its investment in its internationalisation policy. You have presented those facts for the SQA but not for SDI. If you have figures for the return SDI gets on its investment, I, for one, would find them useful. Would that be okay?

Yes.

What proportion of the overall Government budget is spent on this particular area of international policy?

Are you talking about the proportion of overall Scottish Government spend that is on international engagement?

Yes.

With regard to the spend that we captured, international spending represented about 0.1 per cent of the overall Scottish budget. Is that the figure that you are looking for?

I am sorry—what was that figure?

It was 0.1 per cent. It is mentioned at the start of the report.

The figure is 0.1 per cent of the overall Scottish block grant—or £1 in every £1,000.

Finally, has there been—or have you been able to get access to—any analysis of the effectiveness of international development funding and whether it has delivered the intended change?

I think that the impact of the spending was probably beyond the scope of this initial piece of research. At this first stage, and given the time and resources that we had available, we had to focus on the spending itself. Obviously the different organisations evaluate the different types of spending in different ways, and examining how they evaluate that would be a potential—although fairly major—piece of follow-on research that we could undertake.

I did not realise that the issue was not within your remit, so it was perhaps unfair to have expected your report to have covered it. Nevertheless, would it be possible to get that information? It would be useful to find out whether there has been any analysis of the effectiveness of that spend and what it has actually delivered.

We are happy to follow that up. It would be useful to know which organisations you would like us to look at.

I am talking specifically about the international development side of things. There has been a significant increase in that funding over the past five years, and I wonder whether there has been an analysis of the effectiveness of the grants that have been given to organisations working in sub-Saharan Africa and the effectiveness of the overall policy in delivering change. I presume that the Government must have analysed that at some point in the past five years; it would be helpful to see what impact that spending has made in order to put the issue in context.

It makes things a bit difficult when we have no indication of the outcomes from this expenditure. We can all read the headlines and say, “Gosh, that seems like a lot of money,” but without a comparable set of outcomes it is difficult to know whether or not we are actually getting value for money.

From what I can see, the spending on tartan week, the predecessor to Scotland week, was twice the level of the spending on the new event. However, I was slightly taken aback by your footnote to the table setting out the budget figures for tartan week, which says that

“The Scottish Government has been unable to confirm the actual spend figures”

for the three years of tartan week covered in the report. Is there any reason why those figures are not available? Is it really correct that although the Government’s budget for tartan week was £1 million a year or thereabouts, no one has the figure for the actual spend?

Yes. We were not offered those figures; instead, we were told that detailed spend figures could be provided only for the latest three years.

Why was that?

To be honest, I was not given an exact reason. However, I imagine that one of the reasons is that the areas of spend for tartan week related to different activities to those for Scotland week and that the Government was concerned about comparing the figures for tartan week and Scotland week.

11:00

The Scotland week budget figures are dramatically lower—less than half of those for tartan week. However, I am intrigued to find that under the heading “Promoting Scotland’s unique culture and heritage”, the figures have gone up dramatically. In 2008, around £30,000 was spent, and in 2009, the figure was around £25,000. In 2010, however, the spend goes up to almost £60,000. Why are we spending more than twice as much on “Promoting Scotland’s unique culture and heritage” in 2010 than we spent in previous years?

That relates in particular to one exhibition in New York by the Scottish photographer Harry Benson, which ran for almost three weeks and accounted for a significant amount of spend.

Can you identify how much was spent on that photographic exhibition?

Given that the budget for promoting culture went up from around £25,000 to £60,000, I imagine that it was of the order of £30,000.

Was it not in your brief to explore that more deeply, to find out what its purpose was and whether it provided an outcome?

No. We focused on obtaining the overall spend data to begin with.

We will be able to explore some of the reasons for the spend in more detail when the Minister for Culture and External Affairs appears before the committee. Today, we must ensure that we have the clearest information that we need for that meeting, so that we can undertake a proper analysis of the expenditure. We have had a first stab at that.

As the convener said, this is the first stage for the committee. The report is very useful, as it helps to set the groundwork, but—with respect to its authors—it has in some ways not helped us to get off to a great start. I am concerned—as I am sure the report’s authors are—about some of the media coverage during the past few days. The report has been referred to in The Scotsman and in that great voice of reason the Daily Mail, which quoted that other great voice of reason, the TaxPayers’ Alliance, and suggested that international expenditure is “a worthless ego trip”. That does not help the committee to shine a light on international expenditure.

I am particularly concerned about a couple of elements of the reportage. The Scotsman has stated that the report is by this committee, so it would be useful if you stated for the record that it is in fact a report by the financial scrutiny unit. As other members have mentioned, the media coverage has not placed the report in any context—although, in fairness, that is largely because you have not tried to do so. Is it normal practice for the financial scrutiny unit to release to the media a report that it has prepared in advance of its consideration by those—whoever they may be—who have commissioned it? If so, how was that process agreed?

In fairness to the team, the report was in the committee papers, so it had to be put online. SPICe documents are normally put online; that is how the Parliament works.

We can put on the record that the report was prepared by the financial scrutiny unit at the request of the committee.

Okay.

Is there anything else?

Yes. I want to explore other areas, but first I will return to the media coverage, which you understand I am concerned about. It focuses in particular on trips abroad by ministers. Did you say that your report does not refer to that at all?

That is correct. The figures that the Scottish Government provided do not include ministerial visits overseas. We have tried to produce a factual assessment that sets out the amount of money and what it has been spent on, but we recognise that that is only half the picture.

Given that it is only half the picture, it is useful that you have undertaken to come back to the committee with further information. To echo the comments of the convener and the deputy convener, I would welcome additional information on the gross value-added figures and an assessment of the impact of the international development fund.

I see that we have been given a letter from the Minister for Culture and External Affairs to the committee convener. The minister suggests that for every £1 that SDI invests in internationalisation, there is an estimated return of £7, and for every £1 in inward investment, an estimated return of £11 is generated. Scherie Nicol said that she was aware of some of the figures. Does that sound about right?

Yes, those are certainly along the lines of the figures that I have seen quoted by SDI in the past.

Okay, that is useful. Lastly, with the convener’s indulgence—I will be brief—

I think that Rhona Brankin wants to come in on this point, but you may carry on.

Thank you. My point is on the international development fund. Much of the media coverage referred to a 54 per cent increase in expenditure in the international field. However, the report mentions that if the international development fund is taken out, the increase is much more in line with the real-terms increase in the Scottish budget in general. Can you confirm that that is the case?

The report quotes an increase of 20 per cent in the Scottish budget and an increase of 27 per cent in the international development fund, so there is a 7 per cent difference.

That is right.

In fairness to the researchers, they make that point in the report.

I want to explore that point further. In some ways, the international development fund is very different from other types of international expenditure. We accept that spending by SDI or SQA, for example, can either generate income for those organisations or generate economic growth. The international development fund is a different type of project, as generating income or economic growth is not its purpose. Is it fair to say that by including the fund in the report—although I am not criticising you for doing so—you are comparing apples with pears with regard to the two financial years?

The fund is very different, as are all the cultural and performing organisations. We are providing an overview—a high-level picture—of the spend by the Scottish Government and Government-funded public bodies on their activities overseas. We did not make a judgment on whether a particular organisation should be included or not, but the organisations have very different purposes.

Does anyone else want to come in on this point? I know that Rhona Brankin does, and Jim Hume and Sandra White have not come in yet. I will bring in Jim at this point.

I thank the team for the report; it is very good, and we should not shoot the messengers. The report mentions international spend by Highlands and Islands Enterprise, but it does not mention Scottish Enterprise. I realise that Scottish Enterprise uses SDI, but I am wondering about that. Is that just for accounting purposes? Would it not have been more normal for HIE to go through SDI with regard to international development? I also note that VisitScotland’s spend on attracting tourists to Scotland is going down, which is a slight concern.

To go back to the international development fund, which is a large lump and seems to be different from what it was in years gone by, the paragraph below table 5 notes that it is assumed that £5.3 million of the spend overseas relates to the international development fund, but that a more detailed breakdown could not be provided, because, due to the way

“in which this fund operates, it is not known what proportion of this funding is spent overseas, relative to how much is spent in Scotland.”

Why were you unable to find out where the £5.3 million went? As a former member of the Audit Committee, I would have thought that the Scottish Government would be able to highlight that X amount of money was spent there and X amount spent here.

We were certainly keen to obtain that information, but we were told that non-governmental organisations do not have to state on the application form for funds the proportion of spend overseas, for example in Malawi. That information is therefore not recorded at the time of allocation. However, I would certainly be happy to follow up on that.

It is worth noting that the same situation applies to the Scottish Arts Council, which has significant expenditure that is channelled through third parties, but it does not monitor in detail how that money is ultimately spent or the split between how much is spent overseas and how much is domestic expenditure.

Sure, but the international development fund has £5.3 million, whereas the Scottish Arts Council’s spending overseas has actually gone down a bit. I am sure that it knows where the money is going, but we do not know whether it is giving best value.

On your question about Scottish Enterprise, I asked it the same question and was told that all its international spend is channelled through SDI, which is why it did not provide an individual response. However, HIE has separate activities: its export and inward investment activities are channelled through SDI, but it undertakes other activities on its own accord.

Just before I bring in Sandra White, I must say that I was a bit surprised by the amount of money that VisitScotland and SDI spent on marketing and trade missions, which I always thought were strengths of those organisations, because they are about promoting inward investment and tourism. However, that spend is down in both organisations. For VisitScotland it is down by 24 per cent, when its spend for offices and overheads seems to be the same, whereas SDI’s spend on offices and overheads has increased by about 89 per cent. Were any explanations given for that? Could we look into that in a bit more detail?

There are two separate reasons for that reduction in spend. SDI cites efficiencies, so I guess it would say that it is achieving similar impacts with less money. However, with VisitScotland, the issue very much relates to the squeeze on its budget as a result of taking on the area tourist boards.

I thank the witnesses for the report. I am concerned that the media picked up on and reported only the negative aspects of the report, although there are good, positive aspects to it. I seem to remember that Patricia Ferguson, who I am sorry is not here today, was the minister in charge of the international development fund when the previous Government set it up. I can only thank it for doing so.

All my colleagues have referred to the report’s indication that there has been a 54 per cent increase in international spending. Perhaps that should have been broken down to represent exactly what the increase pertained to, which is basically the international development fund. That is a great fund that helps NGOs in Malawi, which is one of our key areas of international spending and which a previous First Minister, Jack McConnell, set up. I think that we should be congratulated on that positive aspect, and I am sorry that the media did not pick up on it. Perhaps the report should have drawn more attention to the international development fund and its work. That may not have been within your remit, but it would have been helpful to get a more balanced report, particularly given what the media has said about it. For example, there was SDI’s strategic decision to increase its overseas market.

On SDI, I want to pick up on an issue that Ted Brocklebank raised about Scotland week and tartan week. The previous Government set up tartan week, which the present Government replaced with Scotland week. It should be noted that less than half of what was spent on tartan week is spent on Scotland week. I hope that the media picks up on that. In fact, the Government has put a cap of £400,000 on spending in that area. We must go out there and sell Scotland—absolutely.

11:15

I seek further information on the SDI situation, which has been raised by myself and others on numerous occasions. My colleague Jamie Hepburn has made the point about how much income SDI brings into the Scottish economy. It would have been helpful if that had been mentioned in the report—although I understand that that was not within the remit—so I hope that we will get the figures to that effect when we next continue with our inquiry. In addition, could we have a breakdown of where SDI trade missions have been held and what the outcome of those were? The report mentions spend within the Europe region, but SDI takes in more than just Europe per se as it also includes other areas such as the middle east, where I know that SDI has led a trade mission. Try as I might, I have been unable to find out who went on that trade mission and what its outcome was. Could we get to that level of scrutiny so that we find out where SDI has gone on trade missions, who has attended those trade missions and what has been brought back from them?

I take on board the point that, for every £1 that is spent, £7 is brought into the Scottish economy. Those involved, including SDI, should be congratulated on that. Notwithstanding whether the effect on the Scottish economy was part of the remit for the report, could figures perhaps be brought back to us that show exactly what SDI brings back for every pound that it spends?

Convener, I will leave it at that for the moment.

Do you want to respond to any of those points just now?

I should just say that some SDI trade missions are run through the Scottish Council for Development and Industry. The SCDI measures the total business that is achieved from each trade mission and has helpfully provided that information. We will attempt to get the same information from SDI.

I am glad that that point has been mentioned; it has been a problem to get that over to people. In reporting to the Scottish Parliament about SDI, people assume that all the trade missions are done by SDI, whereas many of them are carried out in conjunction with the international relations teams that are funded by the Westminster Treasury. Can we get a breakdown of those figures? I am surprised that more detail on that was not given in the report, given that people need to know the difference between SDI and the Foreign Office at Westminster.

We will be happy to provide a specific follow-up on trade missions.

I am interested in what is spent domestically. Where would the figure for international travel by civil servants appear?

That would be captured in the administration budget for individual departments. To investigate that would probably be another report in itself, as it would require some detailed analysis of the underlying activities.

To be honest, it has been difficult enough to obtain information on spend relating to key areas of international engagement. To get spending on international staff travel across the Scottish Government and other agencies would probably be another substantial piece of work.

I should say that, in my view, the report has done exactly what was asked of it. I do not share the view that some colleagues have expressed that the report is not as full as it should be. This very useful report does what it was asked to do.

We are way over the time that was allocated for this item, but I will allow Michael Matheson one further question.

Just for the purposes of accuracy—I am only catching up on the press coverage to which others have referred—I see that the Scottish Daily Mail, which I know is a big fan of international development stuff, reports that nearly £9 million-worth of taxpayers’ money is to be spent on overseas aid, which it claims has gone up nearly 50 per cent in a year. Can you take me through the bit in the report that illustrates that?

I can refer you to the relevant page of the report, but I do not recognise the 50 per cent figure. Let me have a quick look.

Obviously, the story relates to the international development spending—

My specific point is about the international development fund rather than spending on international trade and so on. As co-convener of the cross-party group on Malawi, international development policy is something that is very close to my heart. Having seen on the ground exactly what the fund does, I am anxious to ensure that those in the media who wish to portray such spending in a negative light know that they do no service to the good work that comes through the international development fund. That is why I am keen to establish whether the figure on overseas aid to which the Scottish Daily Mail refers is correct. Can you point me to the bit in the report that would substantiate that position?

Figure 6 shows that the allocation to the international development fund increased in real terms from £6 million in 2009-10 to £8.8 million in 2010-11. As can be seen, that is an increase of almost 50 per cent. The increase will have been inferred from figure 6.

The information comes from table 6.

It is from figure 6, which is on page 13.

It is perhaps worth noting that the numbers in figure 6 represent allocations rather than actual spend.

What is the difference between allocations and actual spend?

Sometimes, the budget is underspent. In 2009-10, £6 million was allocated but about £5.3 million was actually spent. When we produced the report, we could obtain data only on allocations, but we have subsequently received information on actual spend.

That helps—thank you.

That is good—we have clarified that point.

My final question is about relative spend. I remember reading in the report—I cannot find the reference at the minute—about how much we spend on running our Brussels, Washington and China offices. I think that one member of staff is in China, two are in Washington and quite a number are in Brussels. Are figures for overheads and so on available to show how much the Washington or Brussels office costs us relative to the costs of another regional Government?

Such figures are not available per office, but we have office costs by region. They show that the Europe, middle east and Africa region accounts for the largest proportion of costs.

I am interested in whether our Washington office is better value for money than that of the Welsh Assembly Government, for example. The Northern Irish have a Washington office, but I do not know whether they have a China office. The Welsh and Northern Irish certainly have Brussels offices. The figures relate to the number of staff, so that would have to be factored in, but I am interested in how we perform relative to others.

Members have no more comments, so I thank Simon Wakefield, Scherie Nicol and Nicola Hudson for coming along. Someone made the good point that we must not shoot the messengers. We certainly cannot hold our FSU team responsible for press coverage. We have explored several subjects on which it would help to have further information for our inquiry. We look forward to returning to the inquiry after the recess. Thank you for your endeavours.

11:23 Meeting suspended.

11:26

On resuming—