Enterprise and Culture Committee, 01 Feb 2005

Meeting date: Tuesday, February 1, 2005

Official Report 200KB pdf

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State Aid

We move on to agenda item 4, on European Union state aid. Members will be aware of the review of state aid that is taking place in the EU; a detailed paper has been circulated and I think that it is fair to say that concern has been expressed by MSPs on all sides about what is happening. The matter falls within our bailiwick, so it seems sensible for us to take it up.

At this stage, my view is that it is logical to undertake a fact-finding mission to Brussels to get a better understanding of what is going on. That would involve speaking to the people who are carrying out the review and coming back to the committee to identify what we think the Parliament needs to do to influence the review as much as it can, I hope in partnership with the Executive.

I agree. The briefing paper and the background paper that was provided with it were helpful. On the assumption that we have cleared our lines with the European and External Relations Committee in relation to Brussels and areas in which there might be a conflict of interest, I agree that it is appropriate for us to examine the matter. Together with the financial perspectives and the negotiations that are taking place on structural funds, state aid represents an area of support—or the lack of it—for business. It may be available on the same basis or on a lesser basis and it is totally directed by Whitehall and the Treasury. I would like the opportunity to talk through those issues and discuss whether there are things that we can do to influence the outcome and to have some say when the decisions are made.

Stephen Imrie is obviously the person to advise us. Is the European and External Relations Committee doing any work on the issue? I would be surprised if it had not done something, either directly or indirectly, to influence matters.

On European regional development funding and the reform of structural funds, the European and External Relations Committee completed a large inquiry some months ago to try to articulate a view on the reforms. On the reform of state aid, which is a parallel debate, my understanding is that the committee touched on the issue and said that although it was too early to take a view, the debate is an important one and others in the Parliament could perhaps take it forward. The committee considered the matter in passing as part of its inquiry into structural funds, but it did not articulate that it would do any work on it, although it said that it was an important debate for someone to follow. Of course, structural funds fall within the remit of the Enterprise and Culture Committee anyway.

It is my understanding that the kind of detailed investigation that we are talking about is not part of the European and External Relations Committee's work programme.

I agree that we should certainly get more information. On Christine May's point, I am not sure that there is any mechanism that would allow us to influence outcomes. Moreover, the briefing paper does not make the timescales clear. We know that the current situation will apply until the end of next year, but the paper says that the previous round of talks in 1999 continued until nine months before the funding period ended. As nine months before the end of this funding period will take us to the spring of next year, does that mean that we have roughly a year in which to make any input? If so, to whom do we make that input? Does it have to be made via the UK Government? I am simply not clear about how we can influence the outcome.

I think that the Executive has submitted its own evidence to the parallel review, although I believe that its formal submission was attached to the Department of Trade and Industry's submission. At this stage, there is nothing to stop us finding out from Brussels what is on the agenda and how it might affect Scotland. Of course, the questions that we need to ask then are: is there anything we can do about the matter and, if so, how can we do it? This first stage should be a fact-finding exercise, because a great deal of mystery surrounds the matter.

I think that our opportunities for influencing anything might be oblique rather than direct. Nevertheless, opportunities will arise and we should identify them as soon as possible.

Are members agreed that we should take forward this issue? It is not an inquiry per se; it is more of an investigation or fact-finding mission.

The information might also feed into our business growth inquiry.

Can I assume that we have authority to pursue meetings with the relevant people, ideally in Scotland, and, if that is not possible, to request funding for a delegation from the committee to speak to people in Brussels?

And to seek such specialist advice or briefings as might be needed to inform the committee.

Okay. Are members agreed?

Members indicated agreement.

I suggest that, if the meeting takes place here, we invite every committee member. However, if the meeting takes place in Brussels, we should seek authorisation for a cross-party delegation. Do members find that reasonable?

Members indicated agreement.

If the meeting takes place in Brussels, we would be in the novel position of not having to seek dispensation for costs. After all, as individuals, we can use our members' support allowance to travel legitimately to Brussels on parliamentary business.

That is right, but I think that we should cross that bridge when we come to it.

The other question that we need to consider is whether we appoint an adviser. As Chris Ballance pointed out earlier, this area is very specialised and appointing an adviser would be helpful. Are members agreed to set the appointment process in motion through the usual channels?

Members indicated agreement.

Thank you. Before I formally close the meeting, I ask committee members to wait around for five minutes. I seek your advice on two matters.

Meeting closed at 15:28.