Economy, Energy and Tourism Committee, 17 Sep 2008

Meeting date: Wednesday, September 17, 2008

Official Report 256KB pdf

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Energy Technologies Institute

Item 4 is the committee's energy technologies institute inquiry, on which the committee published its report in July. We have now received the Scottish Government's response to our report and I invite members to comment on it. I also invite members to consider what follow-up action, if any, is needed. I note the committee's final recommendation on moving on and moving forward.

I have a specific question at the outset, before we consider the responses. It is clear from the attachments to the Government's response—the correspondence between Sir John Elvidge and the previous convener of the committee—that additional information was supplied after the conclusion of the inquiry. I am not aware that I have seen that additional information and I wonder whether it is available to committee members.

At this stage, the information has not been circulated to members, but I am happy to do that. We have added the correspondence for the committee's consideration, and we will be happy to send members all the attachments to Sir John Elvidge's letter to the previous convener.

Would it help the committee to know broadly the content of those attachments, given that we do not want to postpone consideration of the Government's response? How pertinent and significant are the attachments that we have not yet seen?

That is a difficult question to answer. It would probably be a fair summation to say that the documents reaffirm the views that the then Deputy First Minister and Minister for Enterprise and Lifelong Learning, Nicol Stephen, articulated in some of his evidence to the committee on what he said to policy officials about the location of the ETI. However, the significance of the attachments is really a judgment call for members and, rather than attempting to summarise, I would prefer to send members the information so that they can make their own assessment.

But it is on the process at that stage rather than any other process at any other stage.

Indeed.

That is helpful.

Members will be provided with that information soon.

In that case, and given what the clerk has said, I think that we should consider the material today, rather than await the additional information.

We should consider the responses that have been given.

Yes.

I am happy—glad is not the right word—to note that Sir John Elvidge has recognised that the Government's response should have been more timeous. Given the serious nature of our inquiry, we were right to expect that we would receive the information that we asked for at the time that we asked for it. It is a pity that we did not, but we accept what he has said. I will be interested to see what the Government comes up with.

The Government also says that it is hopeful that the ETI will announce research contracts soon and that Scotland should be well placed to win some of them. Given that we felt that we should have had the ETI because the best research is based here, I share that enthusiasm and hope that the prediction turns out to be correct.

I suggest that we consider the response paragraph by paragraph. In that way, we can quickly dismiss things that are less important.

Does anyone want to comment on the Government's response to paragraph 125?

That is an important paragraph for the context. It became clear from the committee's investigation that the Scottish Further and Higher Education Funding Council was keen to promote collaboration among Scottish universities. The judgment that many made after the event, which is reflected in some of the evidence, is that that was not the best approach for achieving a successful outcome.

There is a strong view, which is again reflected in the evidence, that a bid led by Aberdeen—not in collaboration with other Scottish universities but as bid leader—would have had the same attraction as Loughborough. It was successful because of its closeness to the power generator manufacturing sector, while Aberdeen clearly is the main centre of energy industries north of the border. Although there is nothing objectionable in the response, it prompts the question whether it is right that the Scottish Government or Government institutions should direct or encourage in such a robust way a collaboration that may be unproductive in the final analysis.

One particular problem dawned on me when I was interrogating the statistics. It is true that Loughborough lies in that rich area of English engineering, which means that there are lots of qualified technicians near it. We qualify 2,000 a year in the engineering sector, which is a fifth of the total in Baden-Württemberg despite it having only twice our population. If I wanted to transform university research into mechanisms and sequences of production in those circumstances, I would see the logic of the situation that has emerged. We are strong in oil, but much less so in turbine engineering, for example.

With that said, we shall move on to the response to paragraph 129. Do members have comments?

The response emphasises what I have said. All committee members were astonished that the final decision related to the need for a new building rather than where the best research took place. I am still astonished.

I agree. The important point in the response is that we should look forward. The decision is done; we will not change what happened. We hope that people have learned lessons, but we must now unite to ensure that Scotland wins ETI contracts.

In some ways, the problem of a changeover of Government is at the heart of the matter. I hope that lessons have been learned.

Do members have comments on the response to paragraph 130?

The comment on paragraph 130 is one of two paragraphs in the response that cause me serious concern. The Government questions the committee's judgment on the lack of detailed paperwork and lax record keeping. It also suggests that we have evidence that we have not published and which the Government has not seen. The Government says that it thinks that

"a satisfactory audit trail exists."

We concluded at paragraph 56 of our report that the apparently unanimous view in the evidence that we heard might have reflected

"a reluctance to be drawn into a public discussion",

which is entirely understandable.

Paragraph 131 concerns the same point. It says that civil servants advised Nicol Stephen that he should not express publicly his view that Aberdeen was the right location for the institute, for fear that that would lead to the disintegration of the project bid's unity. That was clearly his view of the advice that civil servants gave him as the responsible minister at the time. That advice was questionable and might have contributed to the final result.

Ministers or their advisers say that

"a satisfactory audit trail exists",

despite the evidence that the committee gathered that a discernible sequence of cause and effect did not exist, which meant that decisions were taken that affected the final outcome directly. That response from the Government to a parliamentary committee's views is unsatisfactory. We should respond robustly to the suggestion that we reached our conclusion in mysterious ways rather than by reference to the evidence.

After considering the response to each paragraph, we will wrap up and discuss how to approach the next stage by finding out information or satisfying ourselves with more detailed answers.

Do members have comments on the response to paragraph 134?

That response is the second about which I am concerned. We recommended clearly that the permanent secretary should conduct a lessons-learned review and report its results to the committee, but the response does not say that he intends to do that. A brief note suggests that he has looked at e-mails, which is fine, but that is not a lessons-learned review and it is certainly not a report to the committee. We should follow up our recommendation and require that report to be provided.

Are there any comments on the response to paragraphs 135 to 137?

Those paragraphs really are important, because they are on the area of production-oriented research, and where we are in areas such as wave technology, for example, which is right at the coal face, although that is perhaps not the phrase to use. It is at that particular point that we can recoup on the research. We have to stress the notion of research that examines the adaptivity of breakthroughs to serious production, whether it is in insulation, turbines, or wave chamber technology and that sort of thing. That is an area in which we are indispensable.

I want to reiterate what Christopher Harvie says and what has been said before. We have received several submissions that talk about not missing the boat this time as far as exploitation of marine and wave technology is concerned. I repeat that I hope that we will not miss the boat, and that we get our fair share of the research contracts.

There is a word in Swabian, which is only to be found in that language—the motto of my part of Germany is that we can do everything except speak High German. The word is tüfteln, which means playing around with an invention until it becomes a saleable innovation. That is the crucial area in which money is made, because you can put it into the first production line techniques.

So we should stop tootling about and get on with it?

Tüftelning about—with an umlaut.

Serious questions have been raised with regard to the Government's responses. I suggest that the clerks draw up a draft letter, on which we can all agree, and send it to the minister, and we can then take the process forward.

If members agree, we will get a report from the clerks of their suggested wording. We can then formulate that, perhaps at the next meeting if there is time, although it should not take too long, given the points that have been made on the record.

And the letter will presumably be circulated in advance?

It will indeed. As members seem to be happy with that approach, I bring the discussion, and the meeting, to an end. Thank you very much.

Meeting closed at 11:37.