European and External Relations Committee, 09 Sep 2003

Meeting date: Tuesday, September 9, 2003

Official Report 270KB pdf

---

Regional Development Funding

Item 5 is on renationalising regional development funding, which is a subject that the committee has discussed several times. The item is on the agenda so that we can decide how to approach regional development and European structural funds. We have agreed at previous meetings to pursue the issue.

The key point in the timetable is between now and the end of the year, when the European Union will publish its next cohesion report. That will give us an insight into the direction in which the EU wants to go. The year after that will also be important in terms of the UK's response to that report.

An immediate issue on the agenda is the consultation that was carried out by Whitehall into renationalisation of regional development funds, and other issues. We indicated previously that we lacked time to address that matter properly and the consultation has now closed. We can discuss how we can move forward.

Committee paper EU/S2/03/3/3 proposes some options that may enable us to make progress. One option is that we could undertake another round of consultation to get people's up-to-date views on specific questions. We could then have a quick evidence-taking session with ministers from Scotland and London. I invite comments on the paper.

I read the paper with some trepidation and perhaps a lack of enthusiasm, because I find myself torn about what is the best way forward. I accept that the subject is important, so the European and External Relations Committee cannot ignore it. Option 1 is to hold a full inquiry. It is obvious that we will not hold another full inquiry when we will be having the inquiry that we discussed five minutes ago. Option 2 is to appoint a reporter—as long as that reporter is not me, I have no objection in principle to that option.

However, it is obvious that option 3 is the only realistic possibility. I wonder—I am interested in other members' views—whether option 3 would have value. We would get a written document, discuss it and hold a one-off evidence-taking session after which, as the paper states:

"The Committee would … publish its conclusions".

My sneaking feeling is that there is no way that I will ever reach a conclusion, because I will never be confident that I know the answer. I am almost certain that my level of knowledge will never be great enough for me to draw a conclusion. Perhaps that makes me a wimp on the matter, but I worry about the value of a process that must—I accept that it must—be truncated in such a way.

In all honesty, I do not know how we can ever reach a conclusion about what we are trying to achieve. I concede that other members could do so, because they have knowledge that I do not have in this respect.

I agree that the third option is the best, although I must qualify that because I share several of Gordon Jackson's concerns on the matter. Quite frankly, I do not think that a one-off evidence-taking session—if that means two hours on one afternoon—is adequate. Once we receive some written responses to the questions that have been sent out, we will need two—or maybe even three—evidence-taking sessions if we are to do the issue justice and not appear simply to be skating on the surface of it.

Unlike Keith Raffan and Gordon Jackson, I could not settle on a particular option, although I know that I am ruling out the first one. Perhaps there should be an option that accommodates options 2 and 3. The obvious question that comes to mind is whether we are aware of what our sister committee at Westminster is doing. I assume that the issue is on that committee's radar screen and that its members are tackling it. If we are going to examine the matter—as it appears we are—we should certainly establish early on what our Westminster colleagues are doing, because they will have a UK overview. We should also find out whether we can meaningfully filch information from them or work with them, and whether what they are doing will dictate our direction. After all, the last thing we want to do is duplicate effort.

The problem that Gordon Jackson raised is a general one that the committee will face as it does its work. We will have to listen to the evidence that is presented to us, weigh it up and try to reach our conclusions. Sometimes it might not be possible to reach a firm and unanimous conclusion, in which case we either do not bother to publish a conclusion, or we vote on the division of opinion and publish the result as a majority recommendation, conclusion or whatever.

I do not see that the subject of inquiry or the third option in the paper gives rise to the problem that Gordon Jackson has raised. However, the third option will probably mean that less evidence would be presented to the committee than through option 1. I am inclined to go for option 1, simply because of the time constraints, but I could be persuaded to choose option 2 if a committee member was willing to declare an interest in becoming the reporter and collecting all the evidence on our behalf. Of course, the member would have to report back to the full committee and we would decide whether to accept their findings, or otherwise.

I accept that the problem that I highlighted comes up in every inquiry. I am not suggesting that we have to be totally learned to deal with a subject; however, it is a question of balance. For example, we will receive so much information for our other inquiry that we will have a reasonable prospect of reaching a view on the matter. It strikes me that the complexity of this particular subject and the fact that we will spend so little time on taking evidence mean that a reasonable view will be almost impossible to achieve. It is a question of balance between the subject's complexity and the amount of time that we spend on it. For example, if you decide to spend 10 minutes on a hugely difficult subject, you know before you start that you will not reach a view. I just wonder how we will balance those aspects.

I ask members to make their comments through the chair.

On a technical point, I understand that there will be on-going European Union regional funding until 2006. That is certainly a matter for the committee's consideration. However, I also understand that renationalisation of that funding after 2006 has been proposed, which means that the UK Government would establish a substitute system from domestic resources to continue regional development funding. Does that technically fall within the committee's remit? Would not it be more appropriate for the Enterprise and Culture Committee or some other committee to deal with that issue? I am humbly seeking the truth—I am not making any difficulties.

The matter definitely falls within this committee's remit, if we wish to pursue it.

Is that the case even though the funding would no longer come from Europe?

That would be the case only if the UK had decided—and had persuaded the rest of Europe—to pursue that line. That decision will be announced in two years' time. At the moment, the question that faces this committee is: what is in Scotland's interests? Although our involvement in the issue has been limited, the Scottish Executive has submitted a response to the UK consultation through the Scottish European structural funds forum.

I understand that we agreed to look at what was in Scotland's interests in terms of—

We could drift into an inquiry on a hypothetical question, which might not be terribly productive.

The question is not hypothetical. The decisions are going to be taken by Westminster in the next few months and by Europe in the next year or two.

All right.

This is the time to influence things.

I want to return to the key questions that we are posing. I am not entirely happy with some of the questions. As the convener said, when we discussed the subject at our last meeting, we queried what is in Scotland's best interests; I guess if we picked away at question 5, we could say that it contains an effort to get at that. However, the key question of how to maximise the benefits of European structural funds to Scotland seems to be lost in the six questions that are included in the paper.

I do not know what question 6 is about—perhaps someone can explain it to me. Are we asking whether the United Kingdom Government is interested in pursuing the same policies that other member states are interested in? Is that what that question is about? If so, it is heavily disguised.

If the member wishes, she can suggest a clearer wording for question 6. If she does that, I am sure that we can accept it.

What are the present arrangements between our clerks and those on our sister committee at Westminster?

I will ask the clerk to answer the question.

I am not aware of which Westminster committee would be the most relevant or indeed whether Westminster committees are looking into this subject area. Our sister committee, if we want to call it that, is the House of Commons European Scrutiny Committee, but it does not necessarily always work in the same way that this committee does in respect of parliamentary inquiries. That committee undertakes inquiries, but I am not aware that it is undertaking an inquiry into structural funds and regional development. I would be happy to find out for members which House of Commons or House of Lords select committees might be inquiring into that subject area.

Through informal discussions with other Scottish Parliament clerks, I understand that neither the Finance Committee nor the Enterprise and Culture Committee, which would be the two most relevant committees in the Scottish Parliament, plan to conduct inquiries of this type at this stage. That is the advice that the clerks are giving to their committees—they are waiting to see what this committee decides to do. If members agree, I am happy to make the appropriate telephone calls to Westminster to find out what, if anything, is happening there.

That would be helpful.

Just to follow on—

I ask the member to speak through the chair.

Do you have any more points to make, Alasdair?

None.

I want to follow on from the point that Alasdair Morrison raised. The paper mentions the structural funds forum. The Scottish Executive has set up a working group in partnership with others to attend the forum. John Bachtler and Laurie Russell, both of whom have a great deal of experience in this area, are crucial to that development.

As Alasdair Morrison said, it would be helpful if we could, rather than go over the same ground, feed into some of the other work that is under way. It is recognised in Scotland—and, possibly, in Europe—that John Bachtler is an expert in the field. If he is doing a lot of work on the subject, perhaps we should tap into that in the same way as Alasdair Morrison suggested we should do with the House of Commons.

I will give a final word to Phil Gallie.

There is a fourth option that is not included in the paper, which would be to hold the item on the agenda and consider it as we receive more information. It was suggested in the European Parliament last week that repatriation of funds was not on, from a European parliamentary viewpoint. I would like to know a bit more about that.

As far as committees at the House of Commons go, I suggest that, as repatriation comes principally from the Treasury, the Treasury Select Committee might be the one to look at the subject. However, we should have more information and a clearer direction in which to go before we make decisions about what we should do. I emphasise that it is important that Scotland is aware and watches for possible changes.

The briefing paper states:

"the DTI hopes to have an initial policy response by early September 2003",

which is around now. When Stephen Imrie is making inquiries, it might be worth his while to check details with the DTI and the House of Commons Trade and Industry Select Committee, which is chaired by Martin O'Neill—like the other Martin O'Neill, the chair of that committee has a particular interest in European matters.

We will find out what members are seeking.

Do members agree to defer the matter so that more information can be obtained? I take it that the matter will stay on our agenda; it is extremely important to Scotland and I expect that the committee will want to scrutinise the Scottish Executive's representations over it. Should we put the matter on a committee agenda in the near future once we have the relevant information? We will vote on the options if we need to, because we must decide whether to investigate the issue.

Members indicated agreement.

May I raise an issue?

Is it about what we have been discussing?

I will raise the issue under any other business at the end of the meeting.

Does it relate to the issue that we are discussing?

It relates to structural funds. To what extent is the committee allowed to follow up unanswered questions in ministers' written briefs? Has the committee done so in the past? A point has been made about the N+2 rule and the fact that the east and west of Scotland are not on schedule and may have to remit funds back. The Executive is considering programmes to ensure that that does not happen, but it does not say what those programmes are. I would like to have more information on the matter. Can we ask for information? Obviously, we can lodge questions, but can we ask questions through the clerks? What has been the practice in the past?

If you are happy, we will ask the clerks to ask questions—that would be no problem at all.