European Structural Funds
The first item on our agenda is our inquiry into European structural funds. Following our previous discussion, I met the convener of the Finance Committee, and the Parliamentary Bureau has also discussed where the issue should rest. The bureau suggested that both committees have competence in certain areas, but that the European Committee has competence in the substantial part of the inquiry's work. Following those discussions, the clerks to both committees met to try to come up with a demarcation between the committees. The paper that members have before them represents the best available option for the European Committee's examination of broad European issues, while recognising the role of the Finance Committee.
I ask the committee to agree the proposal in the paper. I am also asking for members' indulgence in being flexible in relation to the people to whom we have written. We are still awaiting replies, but that is one of those things. If they agree to meet us, we may well have to meet when it suits their diaries, rather than their fitting in with our diaries. We are all keen to try to finish the work before the summer recess but, as I said, a degree of flexibility will be required. We will also take written evidence from a wide range of bodies, including, in particular, academic bodies. I want to suggest that we should decide whom, if anyone, we want to interview as a result of that written evidence, rather than deciding that beforehand.
We must also agree in principle to appoint an adviser. We will not choose that adviser today, but we must obtain approval from the bureau to make an appointment. Although we have discussed this matter before, the Official Report does not show that we agreed in principle to appoint an adviser. We must make a formal decision about that today. I hope that we will be able to get that matter on to the bureau's agenda, in order to be able to make a decision on whom to appoint at our next meeting.
Having made those introductory comments, I will throw open the meeting for discussion.
I have a few comments, convener. Primarily, I wish to seek some clarification around some of the issues described in the paper in front of us. The situation has moved on—as is the nature of the beast—from our first discussion paper, about which we had a good kick around during a previous meeting a few weeks ago. I welcome the paper's broad approach to establishing the basic facts on European structural funds and, from my own perspective, on additionality in particular.
Convener, I understand that you need to discuss matters with the convener of the Finance Committee, but we have yet to see any papers that are to be discussed by the Finance Committee. Therefore, at this stage I am not sure whether there are any holes in the joint approach. We must ensure that nothing falls between the stools. There may be a weakness on page 2 of the document, under stage II, in relation to the procedure. It will be quite difficult to comment further until we see the Finance Committee's papers.
One of the key elements of the inquiry—indeed, the reason for the inquiry—is listed in this document as item 6 on page 3. I hope that the fact that it is number 6 in the list does not affect its priority. A couple of related issues were included nearer the top of the list, in the first paper that we discussed: whether the European structural funds are additional to, or replacements for, sums in the Scottish block, and whether there is a net impact on overall expenditure levels in Scotland. Those two issues are covered in point 6, and I hope that the committee recognises that, on pages 2 and 3, the numbers are not indicative of priority.
Point 5 asks:
"Is there a difference from the Welsh situation in terms of match-funding?"
The Welsh situation is similar to ours. The issue is not only of match funding but of additionality, which is different. Therefore, I suggest that we ask, "Is there is a difference from the Welsh situation?" The question should not focus solely on the issue of match funding, but should include additionality.
Do you want me to stop there, convener, or should I continue with points that I want to raise? I will continue if you want.
No. You are right about priority. The numbers do not signify priority in any way, shape or form. We will give due significance to what we believe is important in the discussions. We will consider the wider issues relating to additionality and replacement. I am trying to remember what we previously discussed in terms of net expenditure.
The words that we used were:
"Is there a net impact on overall expenditure levels in Scotland?"
That would be covered in what we see here, and we can tease that out as we go forward.
I am trying to remember what was previously discussed about the Welsh situation in regard to match funding. I am not sure that there is much of a difference between us. I do not know whether the way in which the question is worded is significant, or whether that is just the way in which the previous discussions panned out. I need to ask for advice on that. Without wanting to cause too much disruption, I will ask the clerk to go and check that out. Rather than have him leave the meeting, we will do what we can today and come back to the issue if we have to.
The other points that I want to raise concern the proposed witnesses on page 3. I welcome the invitations that are being sent out to Scottish and UK ministers and to EU officials. In this process, we must be mindful of the costs that are involved, and we must bear in mind the limited scope for inviting witnesses. As only one academic study has been conducted in the UK in the past few years on structural funds and additionality, and as only one public inquiry has been held into the subject, the academics concerned should be invited, to enable a balanced view to be reached. The chairman of the Welsh Affairs Committee is not on the list either, although that is the only parliamentary committee that has undertaken an in-depth study into this issue.
As reference is made to the Welsh situation, I would expect us to be able to lean on the academic study that was undertaken by Dr Gillian Bristow and Dr Nigel Blewitt of the Institute of Welsh Affairs, who have been thoroughly involved in the whole process. Given that we want to make a comparison with Wales, I thought that they would make a useful academic starting point. I know that we have not written to them, which is rather disappointing, and I hope that we can agree that the Institute of Welsh Affairs, as represented by the academics whom I have mentioned, should be invited to give evidence to the committee, along with members of the House of Commons.
I understand that there is a need to take written evidence from the wider body of academics. I hope that we can get that reasonably early, as it will drive the questions that we want to ask the ministers and the other witnesses whom we invite. I and, I am sure, other members would find it helpful to hear where the academics are coming from, so that we can have a proper discussion of the issue with the minister, the secretary of state and others.
Within the last month, the European Parliament has taken a view on the issue of additionality, passing a motion by 368 votes to 10. It might be useful to take evidence from politicians who were involved in moving that motion, which had wide cross-party support.
I will deal with your points one by one.
I suggest that we take written evidence from the academics and then decide which of them we wish to invite to appear before the committee, rather than determining that in advance. I do not, therefore, support our deciding now to invite the Welsh academics. I believe that they should be treated in the same way as the other academics who supply us with information.
I am cautious about inviting members from the House of Commons and the European Parliament, who are having political debates on this issue as part of their elected responsibilities, to appear before the committee. We are elected to consider these and other matters on behalf of the Scottish Parliament. It is for members of other bodies to come to their own views on this subject, based on the evidence that they receive.
In my view, we should reach a conclusion on the basis of the information that is presented to us. I do not see the benefit of hearing from a member of a House of Commons committee who did nothing but take evidence from various quarters, which is what we are doing. We are more than capable of reaching our own conclusions, based on the information that we receive.
Similarly, we should obtain a copy of the report that was produced and the motion that was passed by the European Parliament, but I am not sure that our hearing from a politician who spoke for or against that motion would add much. Members of the European Parliament are no more expert in these matters than other politicians.
I want to draw the committee's attention to some differences between the original briefing paper that we received a month ago on the remit of the inquiry—EU/00/6/1—and the one that is now before us. I agree with Bruce Crawford about stage III, the implementation of the funds in Scotland and how they are broken down. It might seem pedantic but it is important to expand the wording of the remit and to get it right because we may find that people in the Treasury stick to that wording.
I was happy with the key issues that were set out in the previous draft. It asked:
"Are European structural funds additional to, or a replacement for, sums in the Scottish Assigned Budget?"
The second question in that draft was:
"Is there a net impact on overall expenditure levels in Scotland?"
I am not happy about the sixth point in the revised remit because it says "Within Scotland". The three institutions that are involved are the Treasury, the European Parliament and the Scottish Executive. From answers to question that I have asked, I know that some funding is not paid out from within Scotland but comes in directly through a UK system, for example, through the Department of the Environment, Transport and the Regions.
I prefer the first two key issues in the previous paper. They are clearer and express our aim. There should be a yes or no answer to those questions, but point 6 is a bit woolly. I hope that the inquiry will be the end of the matter for now. The more direct the question that we ask, the more direct the answer will be.
I have several quick points. First, on the crossover between the two committees, the briefing document says that:
"Members from either Committee will be free to attend meetings"
Should we nominate somebody so that at least one member of the committee will definitely attend the Finance Committee? That may be more useful than leaving the matter open-ended.
It is my understanding that any member has the right to attend any committee, although whether a member speaks on behalf of the committee is another matter. I do not want to appear to disfranchise anyone who feels strongly enough about something to go the Finance Committee, but I think that your suggestion is a good one. As we proceed, we can nominate members to take to the Finance Committee specific issues that we want to address. I would hesitate to limit members.
I did not want to suggest that. If we nominated a member, we would guarantee that we had a member present at meetings of the Finance Committee, either taking a message to that committee or bringing one from it.
We will try to accommodate that suggestion, with the proviso that anybody who wishes to express a personal view at meetings of the Finance Committee is entitled to do so.
I have a couple of other points. We talked quite a bit about the issue of taking evidence from academics. Cathy Jamieson said that, in the first instance, written information would be very useful, but we may then want to meet one or two key people. On Bruce Crawford's point about the Welsh situation, if we get a report or other information about that, it may be interesting to invite a witness to go over some points, as sometimes doing that clarifies issues.
I also have a purely selfish point. I cannot attend all the meetings of the committee because the Local Government Committee meets at the same time right up until summer, but I might well be able to attend meetings of the Finance Committee on occasion, if somebody were needed to do that.
I want to return to Bruce Crawford's point. The original draft of the remit asks:
"Is there a difference from the Welsh situation?"
I think that we should be consistent with that in the revised remit.
Ben Wallace's point about the wording "additional to" or "replacement for" was slightly similar to Bruce's, although Ben also talked about going beyond Scotland. The two original points mentioned Scotland as well.
I mentioned the phrase "Within Scotland". That was all.
I am content to go back to the two original bullet points as they are, which would ensure consistency.
We are being asked to approve the division of the inquiry into two. I am not sure why; it is certainly not explained in the paper. It seems an unnecessary duplication. Stage II of the suggested format for the so-called dual inquiries could easily be split up and put into stages I and III, resulting in a two-stage inquiry to be conducted solely by the European Committee. That would let us get over a lot of these problems.
I would be interested to know how the division came about. Was it a question of two parliamentary committees being unable to agree which one would be the lead committee? Is there not a better way of resolving this, one that would not result in duplication of work and that would not result in people going between two committees as suggested by Sylvia Jackson?
Bruce Crawford and his party have been making the running on these issues and creating the need for the inquiry in the first place. If Bruce wants Welsh academics and representatives of the European Parliament and the House of Commons et al to be invited along, perhaps we should give that due consideration. However, if we were to extend our inquiry beyond the time scale that has been proposed, the likely outcome would be that we would have to extend the inquiry beyond the summer. That may be what is desired, I do not know. However, if it is felt necessary to do that to get to the root of the problem, if problem indeed there is, I am in favour of doing that.
I have already given my view on that. I would stick with the suggested time scale.
I will answer your first point. We have tried to reflect the fact that the Finance Committee felt strongly that it should have a role. It felt that it should be the lead committee in these matters. I argued strongly that we should be the lead committee. The matter was also discussed in the Parliamentary Bureau. Its recommendation was that we should all meet to try to reach an agreement. That agreement is what you see in the paper before you.
We have tried to separate the issues. Although the inquiry is divided into stages I, II and III, it would not be a question of our completing stage I and then waiting on the Finance Committee to complete stage II before we could go on to stage III. Stage II is separate, and deals with United Kingdom Treasury accounting issues. I do not think that it is for the European Committee to investigate how the Barnett formula works, what the implications are for the formula and so on. We have properly left that to the Finance Committee, separating it from all the other Europe-related matters that will be dealt with by this committee. There is a clear division, and one that has the agreement of the convener of the Finance Committee.
I want to pick up on the point that Sylvia Jackson made. I think that I also made this point at a previous meeting. I understood that the point of trying to get as much written evidence as possible was that that evidence would inform us and help us decide on the questions we wanted to ask and, indeed, on who we might invite along to the committee to give supplementary oral evidence. I do not see any point in asking people to come here simply to repeat what they have said in written papers.
Following on from Allan Wilson's point, I am concerned about the suggestion of flexibility. A number of committees are now meeting weekly and a number of inquiries are going on. I do not want to seem inflexible: just how practical will it be in terms of the work load of the clerks and everybody else to get people together on a flexible basis? There should be a limit to the extent of flexibility.
Through the invitation, we will try to fit people into our timetable. If someone is available but not on the suggested day, it would not be in our interest to say we cannot accommodate them. We will try to adhere to our timetable but we should retain some flexibility so that some very busy people can come before the committee.
Synchronisation will be crucial, because we will miss opportunities for questioning if we do not get the listing right. The way the clerks have listed it, with the European Court of Auditors and the director general for regional policy first, is right, but it will be difficult to get those people. Is that still a possibility for next week? It is important that we have evidence from them before we speak to the Scottish Executive and the Treasury.
Because of the pressure to complete the inquiry by 13 June, there could be a temptation to hold meetings anyway. Next week is particularly difficult for me as a minister is coming to my constituency and I am speaking at a conference.
How will we liaise with the Finance Committee? I note that we are to have a special adviser, which is a good idea. Is the same thing happening in the Finance Committee? Like Allan Wilson, I am concerned that this is a big piece of work in a very short time. It will be difficult to arrange our witnesses, work with our adviser and tie in with the Finance Committee.
I do not know whether the Finance Committee is appointing an adviser.
The two pieces of work should stand independently; we can then forward our conclusions to the Finance Committee. Given the complexities of the Barnett formula it would be wrong to wait until its investigation is complete. I do not think it will want to be constrained by having to look only at Barnett in relation to European funding. There are wider issues that the Finance Committee will want to look at and European funding will make up a significant but not exclusive part of its investigation. We will keep in contact as best we can; I hope we will not be prejudiced in our ability to proceed by what the Finance Committee is doing.
When Ben Wallace and I indicated our initial support for the inquiry, one of our key concerns was that it should be definitive so that the matter can be put to rest. I am therefore pleased to hear what you said, convener, in relation to Ben's point about the two points in the previous paper. That will be helpful.
Secondly, if it appeared not to be possible to do the work in the way we want in the time suggested, I would prefer the inquiry to go on longer and be definitive than for us to constrain ourselves by sticking to finishing by the summer recess.
Thirdly, I agree with Bruce Crawford's point about the Welsh situation. I have attempted to read the paper. I do not think that it is possible to evaluate it without having the people here to ask them questions. If we want to put the Welsh issue to bed, we need to have that level of discussion, because there is a particular comparison with Wales. I therefore support involving the Welsh academics.
It would be sensible to review progress after a few weeks to see whether we will be able to reach a conclusion before the summer recess. It is still my intention, if at all possible, to finish the inquiry by then, because I do not want it to drag on ad infinitum. However, equally, members are right to say that if we are going to do the inquiry, it must be done properly. We do not want to rush to a conclusion simply for the sake of meeting a scheduled date, so we will come back to the timetable if need be.
We were not saying that we would not invite the Welsh academics. I suggested that we should get the papers from the academics and then decide who, if anyone, we want to invite. We have already said that there are points in the paper that need to be teased out, but we may reach the same conclusion about other papers when they come in. We need to have a fairly open mind about who should be brought in and the value that they can bring to the committee's deliberations.
First, I apologise for my lateness. If I ask a question that has already been asked, I am sorry. I have just read section 2 about the way forward, which points out that the inquiry will be not
"a joint Inquiry but two distinct yet inter-linked Inquiries".
I was supportive of that in the context of doing a definitive piece of work, as David Mundell described, that answers the real questions that many members are posing. I went on to read in the briefing paper that the Finance Committee will take evidence on areas broadly in line with ours. I must confess that I am at a loss to understand why two committees need, in effect, to go over the same ground. We are the European Committee and we should do this inquiry. That should be the end of the matter. However, it has happened and I accept that we must move on.
I want to clarify a couple of points. What happens when the final reports go to Parliament? Will they go jointly or separately? Will we debate the subject on two different days? I take your point, convener, about duplication. There is something in the paper about the clerks having to work together to ensure that we do not duplicate the work. How are we going to ensure that two parliamentary committees do not get bogged down asking the same questions in two different committee corridors in the same week?
I will let Stephen Imrie answer the technical point about how the reports will be presented to Parliament. I made the same point that you have just made to the convener of the Finance Committee and to the representative of the Parliamentary Bureau. I told them that I felt very strongly that our committee should conduct the inquiry. However, the Parliamentary Bureau was not prepared to say that only one committee could examine the issue. It was felt that the Finance Committee had a legitimate interest.
As part of the negotiations, there was an attempt to define the areas of interest. I hope that that will mean that the two committees will not go over the same ground. I am clear that this committee should deal with any matters relating to the European perspective and European issues and that the Finance Committee should examine how that impacts on internal UK accounting mechanisms and, specifically, the Barnett formula. We will have to wait and see.
Stephen Imrie (Clerk Team Leader):
On the reporting procedure, the Finance Committee will be able to publish its own, standalone, report. Assuming that it reports before we do, we, as the lead committee, would incorporate its views and report into our final report.
It is getting awful esoteric now.
I apologise for being late. Does not the Finance Committee have to wait until there is something—the findings of this report—for it to discuss?
Not necessarily. I am not in a position to influence the deliberations of the Finance Committee. If it chooses, it can start the investigation into the Barnett formula. It may conclude that it needs some information from us to help in its deliberations, but that is a matter for the Finance Committee.
I notice that we have a visit from the Secretary of State for Scotland or one of the Treasury ministers arranged for 23 May. That would be very short notice for a minister and I wondered whether there had been any tentative inquiries to see whether their diaries are free.
We have written and we have put out some feelers, but have had no response as yet.
I would like to return to my point about whether EU officials from the European Court of Auditors and the regional policy directorate general are likely to be available next week.
You are absolutely right to raise that, Irene. I suggest that we do not proceed with next week's meeting—that will allow people a bit more time.
Has the secretary of state agreed to come?
No. We have had no formal notification from anyone as yet. We are inviting people—whether we get ministers or officials remains to be seen.
That might be relevant to our timetabling.
It will be.
If they cannot come, I would be happy for this to be arranged after the recess so that we can ask questions of the right people.
We will respond whenever we have further information. How do members feel about the recommendation that we do not proceed with next week's meeting, given that we have not received any indications yet? Is that agreed?
Members indicated agreement.
Instead of having witnesses next week—and I do not think that we should have a meeting next week—we should get the information from the Institute of Welsh Affairs report now, so that we can start digesting it and make a decision at the next meeting about which academics, if any, we should ask along. The sooner we get the written evidence, the sooner we can make those decisions.
We will get that circulated.
I have some letters from Michel Barnier, the regional policy commissioner, that the committee might be interested in.
Please pass them to the clerk and they will be circulated.
Convener, you gave a fairly clear indication that the committee would revisit the time scale if it proved impossible for us to deliberate fully. Is there no prospect of our revisiting the matter of the duplication and replication inherent in the Parliamentary Bureau's decision to split this inquiry? It seems potentially to be a recipe for confusion at the end of the process if conflicting reports appear. We will be not one step forward from where we are—or where we were previously, depending on our perspective. A lot of time and effort and significant resources will be devoted to this.
I am reluctant to retrace our steps, Allan. This proposal was the result of a tripartite discussion. I hope that we agreed that we would split clearly the areas of consideration so that the problems you have identified will not arise. I suggest that if we retrace our steps we will be unlikely to get agreement to what you seek.
If I may return to the point that Sylvia Jackson made, surely someone should be monitoring both inquiries—and not just off their own back—so that they can point out that questions have already been asked in the European Committee or in the Finance Committee.
We have already agreed that we will attempt to monitor the Finance Committee's inquiry. However, we cannot prescribe what another independent committee of the Parliament will discuss. I hope that it will not duplicate the work that we are doing, but even in this committee the same point is often made on two or three occasions—that is in the nature of committee work and of democracy. We need to be sensitive to the Finance Committee's aspirations and to what it is attempting to do. I do not think that there would be any value in discussing this issue again with the bureau; it has taken us long enough to get to this point.
Taking into account the changes to the wording of the document that Bruce Crawford and Ben Wallace have suggested, Sylvia Jackson's suggestion that we liaise closely with specific individuals, the suggestion that we appoint an adviser, and the need for flexibility in the timetable, are we agreed on the remit of the inquiry?
Members indicated agreement.