Objective 3
The first item on the agenda this afternoon is a discussion of the objective 3 draft operational plan. To help us with our deliberations, we have invited Heather Koronka, from the Scottish ESF objective 3 partnership, and David Chalmers, from the Scottish Executive development department. I stress that this is an informal and factual presentation. Any questions on the content of the draft plan will not be considered here. The Minister for Finance, Jack McConnell, will brief the committee on that, hopefully on 19 October. I will come back to that later.
David Chalmers (Development Department, Scottish Executive):
Good afternoon. I will begin by introducing myself and my colleague. Heather Koronka is the programme director for objective 3 and the member of the plan team that has prepared the document that is before the committee today. I am from the European social fund branch of the Scottish Executive development department. I am convener of the Scottish objective 3 and objective 4 committees. More relevant for your purposes today, I am convener of the Scottish objective 3 plan team.
With your permission, convener, I propose to ask Heather to provide the committee with a brief outline of the plan and its strategic context. Before doing so, it may be helpful if I preface her presentation with some preliminary remarks. After the presentation, I suggest that we discuss some of the emerging issues relating to the plan.
Even though I am the convener of the plan team, the draft plan is not a Scottish Executive document. It has been prepared by and remains in the ownership of the objective 3 plan team. The plan team comprises representatives of the key partners, which include the Convention of Scottish Local Authorities, the Scottish enterprise network, the voluntary sector, the Scottish Council of National Training Organisations, the further and higher education sectors and the Equal Opportunities Commission—with occasional additional participation by the Scottish Trades Union Congress, the Confederation of British Industry for Scotland and the Scottish Council Development and Industry.
The plan team has been meeting since February, mostly fortnightly, to develop the plan. That has entailed a massive commitment of time and effort from the individuals involved, particularly as we all have proper jobs as well. I want to put on record my appreciation of the constructive and assiduous way in which the team has engaged with its task.
Over the next month, the plan will be formally submitted to ministers of the Scottish Executive. When Mr McConnell comes before the committee on 19 October, he will discuss the Executive's objective 3 plan.
I should say that at present the plan is a draft and incomplete. I appreciate that the committee would have preferred to see a complete version; I apologise that our timetable was such that that was simply not possible. After it had thrashed out the priorities and measures for the plan, the plan team considered that it was appropriate to seek the views of the wider partnership, even though we had not yet developed the accompanying financial tables. The plan team recognises not only that the plan is incomplete, but that improvements need to be made. I will be happy to explore those if we have time.
Nevertheless, I am satisfied that the broad strategy of the plan is about right. If we wanted to have meaningful consultation with the wider partnership, the plan had to be brought into the light of day.
I offer a further caveat. The draft plan has been written with one audience in mind—directorate-general V of the European Commission. It has not been written with a view to telling a general audience or even the wider partnership what we propose to do with European social fund assistance. The composition and structure of the plan follow the various pieces of guidance that we have had from DG V and the result is not a particularly reader-friendly document.
Finally, I should perhaps pre-empt one of the committee's first questions by saying something about the financial value of the proposed programme. The amount to be allocated to the new programme has yet to be finalised. Scottish Executive ministers and Scotland Office ministers, acting in co-operation, are still discussing with their Whitehall counterparts the Scottish share of the UK allocation under objective 3. That UK allocation is more than €4.5 billion. Whatever the outcome of the negotiations between ministers, it is clear that we will have less European social fund expenditure under the new programme than is available through existing programmes. That reflects the overall reductions in structural funds expenditure.
As a result, we need to maximise the impact of ESF in the new programme, which is why we have put so much effort into designing and developing the plan before the committee today. I will now ask Heather to give her presentation.
Heather Koronka (Scottish ESF Objective 3 Partnership):
Good afternoon. As time is tight and the committee might want to ask questions about detailed issues, I will keep my presentation on a relatively broad level by highlighting areas of likely interest.
I will give a brief background to the plan, outline the objectives behind it and describe how they translate into priorities and measures for action. I will then talk about how we have arrived at where we are. The details of target groups and scope of activity have been helpfully laid out in the paper that has been circulated to committee members.
The committee has had a detailed presentation on the Treaty of Amsterdam, which revises the Treaty on European Union and now includes a chapter on employment. That issue is now at the top of the European agenda and has had a knock-on effect in different ways. We now have a European employment strategy at EU level, which requires each member state to produce a national employment action plan.
The plan sets the frame of reference for the European social fund and for employment in general. The preparation of ESF programmes from 2000 to 2006 will be based on the UK policy frame of reference, which informs all ESF interventions, and the community support framework, which informs the three operational objective 3 programmes. We are charged with producing the Scottish operational objective 3 programme, of which the committee has seen the draft plan.
The plan has five vertical priorities which reflect the five key ESF policy fields for the new programming period across the EU and which will recur as I go through the plan's priority and measure structure. Those priorities are active labour market policies, inclusion, lifelong learning, adaptability and entrepreneurship and positive action for women.
In addition to those five key themes, there are five horizontal measures—as we say in Eurospeak—which are sustainable development, equal opportunities, lifelong learning, support for local initiatives and the information society. We have to make sure that such measures are integrated in the plan.
In putting the plan together, the plan team has had to translate the requirements of those key themes into an overall aim of supporting economic growth by contributing to sustainable development of a competitive economy with a flexible labour market and ensuring equal access to training, employment and income-earning opportunities.
My next slide is not a test of members' eyesight; a full-size version of the diagram is attached to the hand-out that has been circulated. The five operational objectives have been translated into our overall aim and inform our priorities, which are the five key themes put into a Scottish-specific context.
The plan is structured in terms of priorities and measures. The first priority—raising employability—addresses the theme of the active labour market at EU level. The aim of the priority is to reintegrate various unemployed target groups back into sustainable employment, allowing them to fulfil their potential and to move away from the risk of exclusion.
In considering that theme, the plan team decided that three main groups needed to be targeted: the short-term unemployed, young people and the older unemployed. The majority of people leave the unemployment register within six months, so we need to focus on skill development and the accreditation of skills that those people already have. We want to increase the number of people with the skills that are required by the economy, so that it becomes more competitive.
There are national schemes in place for young people, but the plan team felt that there were still many young people with little or no work experience who were becoming serially unemployed over a relatively short time. We need to assist 15 to 24-year-olds in developing skills for the work place. We must also take a preventive approach by addressing the needs of young people who have not yet left school.
The objective for the older jobless is to help them back into secure employment through appropriate guidance, counselling and training. That focuses on the 40 to 50-year-olds. The needs of the over-50s and the longer-term unemployed are covered in our next priority, which addresses exclusion.
The second priority addresses the theme of an inclusive society that is open to everyone. It is obvious that the priority complements current policy direction in terms of addressing exclusion at different levels. The plan team recognised that some disadvantaged groups tend to be geographically targeted in urban and rural communities. Two measures pick up on those geographically concentrated groups. We also recognised that that did not always happen and the thematic priority is designed to catch the groups that are not geographically targeted. The focus of the priority is on meaningful partnerships, which ties in with the aims of the social inclusion strategy. We would like all project sponsors to be able to demonstrate true partnership, both within and across partner agencies, in schemes that work towards those objectives.
The thematic measure is designed to engage excluded individuals, raising aspirations and changing the perceptions of training held by groups such as the ethnic minorities, the disabled, the homeless, ex-offenders and young people leaving care. In terms of support targeted on urban areas and forging effective links between employment opportunities and areas of need, we are focusing on workless households, older long-term unemployed and people who are recovering from substance abuse, for example. We are trying to encourage flexible and innovative solutions for people in rural areas, where accessing transport can be a problem.
Finally, the capacity building measure recognises the need to increase the number of organisations that are working towards tackling social inclusion at a local level and to improve the quality of support delivered to the target groups.
The third priority is lifelong learning, which entails promoting employability skills and mobility through lifelong learning, as outlined in the briefing paper. Many initiatives have been launched in support of the lifelong learning agenda—for example, the Scottish university for industry and the national grid for learning, which will use new technology to increase access to learning. The ethos of individual learning accounts, in which individuals are encouraged to take responsibility for their own learning, complements those other initiatives.
As members will know, lifelong learning is a horizontal theme, but this vertical priority picks up areas of activity where the plan team felt that further positive and focused support was needed. We are dealing with increasing the management skills in training organisations, which will increase organisations' ability to deliver training.
There is a need to increase the technical skills that are available. We have reference services available but there is a need to put together the on-line systems and training delivery mechanisms to ensure that learning is accessible to the majority of people.
Our fourth priority, which we call "Towards a Competitive Economy", picks up the European theme of developing adaptability and entrepreneurship. Evidently, the competitiveness of the Scottish economy is a strategic aim of the overall programme, but it is important to harness the skills base in the Scottish labour market while trying to create a more entrepreneurial culture in which we will be able to concentrate on the creation of small and medium enterprises.
We stress the importance of those issues by splitting the fourth priority into two parts—our contribution to the EU simplification strategy. In the first part, we have the competitive work force addressing lifelong learning and skills development. We want to raise awareness in companies about the value of training and development. We have split the vocational training that is required into three parts: basic, intermediate and higher level skills. That will allow the programmes to focus on target groups effectively.
The basic skills category deals with the provision of transferable skills and knowledge and is aimed at improving people's employment prospects with the overall aim of preventing workers from becoming unemployed and unemployable.
The intermediate category deals with flexibility in relation to craft-related occupations and with updating the skills of supervisors and technicians in relation to changes in information technology.
The higher level skills category deals with technical and professional skills for higher level management in competitive small and medium enterprises and is a way of reinforcing managers' awareness of the importance of training to them and their work force.
The second part of the fourth priority is entrepreneurship. Our aim is to create a more entrepreneurial culture in Scotland, to increase Scotland's business birth rate and to provide support to individuals who are engaged in the formation of new firms. To do that we need to address underperformance of the business start–up rate, promote and develop an enterprise culture, establish networking events and encourage promotional activity.
We aim to increase the number of new and sustainable companies in Scotland by supporting community businesses and getting people into self-employment through the provision of support, advice and training.
The fifth—and final—priority is addressing gender imbalance. This is a horizontal and a vertical theme. The plan team is keen thoroughly to mainstream equal opportunities in the plan. Equality of opportunity is top of the EU agenda and is paramount in maintaining economic competitiveness.
With regard to the priority of addressing gender imbalance, there are three measures that support positive action. The first promotes positive action with regard to companies and individuals, by showing the benefits of addressing gender issues and gender imbalances, and implementing family-friendly policies. The second provides support to address gender imbalance in areas in which men or women are traditionally under-represented. It also aims to assist women to take up opportunities in higher-skilled or higher-paid areas. The final measure provides direct support to companies to improve their equal opportunities policies.
The objective 3 partnerships are represented on a steering group, led by the Equal Opportunities Commission, that is putting together an equal opportunities toolkit to help all the plan teams in Scotland take on board equal opportunities issues and ensure that we mainstream equal opportunities across all the structural fund programmes.
I hope that we can deal with detailed issues through questions, so, to finish, David mentioned that the draft plan has been developed in partnership. We had workshops as far back as April, with 250-300 people at them, to try to determine our outline strategy and to work out what we needed to do for what, effectively, is a seven-year employment plan for Scotland. We took what we learned from the partnership consultations to a strategy day for the plan team and put in place a strategic framework. We involved the partners that represent the objective 2, 3, 4 and 5b programmes, and examined the key themes, such as lifelong learning and sustainable development.
We are coming to the end of our first stage consultation process. We are expecting responses from partners by 1 October. We need to consult again on the financial issues, but the plan needs to be with the Commission by the end of October.
I am sorry that I went through that information so quickly, but I was keen to take the members of the committee through our priorities and measures, at least at a broad level.
Thank you, David and Heather. I appreciate the constraints that were on you.
Behind the welter of jargon there is a lot that is of direct relevance to communities and organisations throughout Scotland. You touched on some important objectives and policy initiatives that I am sure will be of interest to members and the communities they represent.
I will ask a couple of questions to get the ball rolling. David, you suggested that improvements had still to be made to the document. What are they? When will the financial value of the programme be determined? Heather, where do the policy fields differ from the previous programme? Are you targeting geographically and sectorally in any way? There has been discussion about ensuring that European funding is targeted to the areas that are most in need, and that the targeting is also consistent with other objectives of the Executive and the Parliament.
The other point that I took from this meeting—I would like to return to it later in the discussion—is that a lot of the information will be relevant to other committees, and practical opportunities arise from that. I would like to work out where we can assist in raising the awareness of those opportunities.
The plan team recognises that the plan is far from perfect. There are two areas that we must pay particular attention to.
The first is that the plan is supposed to form a coherent whole. The analysis of labour market needs and of what was done rightly and wrongly under previous programmes must feed into the strategy, which in turn must feed into the priorities and measures. The plan team is not sure that all those connections have been made. The plan team has long experience of this sort of matter and has come to the right answers without necessarily demonstrating how it has come to those answers. We need to take another look at all the hooks and ensure that what emerges in the strategy responds to the labour market needs and analysis of previous programmes.
The other area that needs further consideration is the horizontal priorities, such as equal opportunities and lifelong learning. The plan team is not satisfied that those have been fully integrated into the vertical measures. We need to go through each of the measures to determine how they will contribute to equal opportunities, lifelong learning, local initiatives and information technology.
Those are the two areas to which the plan team will give specific consideration, with a view to tidying up the next version of the plan.
Can you please answer the other question: when will the financial value of the programme be determined?
I confess that I had rather expected the financial value of the programme to be known before now, bearing in mind that we have little more than a month to submit the plan to the European Commission. I would expect to have established the value of the new Scottish objective 3 programme within the next 10 days.
Before I bring in Dennis Canavan, I want to return to your remarks about integrating the horizontal priorities, specifically equal opportunities, into the vertical measures. Given the emphasis on equal opportunities in Europe and here, it is striking that you feel that they have not been given adequate attention. Surely something like equal opportunities should be absolutely fundamental to everything that is done.
That is why some of the measures need to be re-examined. If one looks at some of the measures in the plan, it can be seen that they include a description of the activities that will be involved and of the target population. Frequently, however, there is no mention of equal opportunities or gender imbalance, for example. We need to go back to ensure that equal opportunities are fully horizontally integrated into all the measures of the plan.
Does it not strike you as worrying that at this late stage, so close to the finalisation of the plan, which involves so many agencies who are aware of political priorities, that the team has to go back to ensure that equal opportunities are integrated sufficiently robustly? Surely whoever has been responsible for the plan should have been insisting on such integration at every stage.
In an ideal world that would have been the case, but the fact remains that I am not sure that we did. That is why the plan team wants to have another look. We want to ensure that we have fully integrated the horizontal priorities.
Priority one is to raise employability. I do not think that anyone argues with that aim. However, when Heather gave her presentation she listed the target groups as young people, older unemployed people and the short-term unemployed. She made no reference to the long-term unemployed. What is the definition of short-term? Is it six months, a year, or what? Why is there no specific reference to the longer-term unemployed? My fear is that they will become more and more excluded—socially as well as economically—unless they are prioritised in objective 3 spending.
On the definition of the short-term unemployed in the plan, I mentioned the statistic that, in relation to the proportionate resources that we have, most people come off the register within six months. Therefore, the focus for the short-term unemployed would be on the six to 12-month unemployed.
I briefly mentioned—but probably have not highlighted it as much as I should have done—that our intention is to pick up the longer-term unemployed under priority 2, addressing social inclusion. That will enable us to target them more effectively and to target sufficient resources and associated support services where that client group has particular needs. The focus of priority 1 is a preventive approach, to prevent people falling into the long-term unemployment category and becoming excluded.
In terms of social exclusion and equal opportunities, one of the major barriers to women re-entering the work force remains child care. To what extent are European social fund moneys linked to national strategies, such as child care partnerships? Can Heather give us an assurance on how those two programmes are linked?
At the moment we are considering the policy context, but I already mentioned that in the detail of the plan, reference is made to both UK and Scottish initiatives on child care. The rationale for the priority of addressing gender imbalance is that that is an area of great need and one of the major barriers. Detailed statistics back up that claim.
When we consider selection-scoring criteria and consider in more detail how we implement the programme, we must ensure—across all the priorities—that each target group gets the associated support services. That means child care across the board, especially when we target returners to the labour market. That comes under the priority of addressing gender imbalance. It is picked up in the plan, and we are aware that we must ensure that support services are in place for those target groups.
I will ask one further question about the small and medium-sized sector. We know that Scotland has a low business birth rate and fewer small and medium-sized businesses per capita than in England and Europe. We have been asking for some time whether targets are in place. How are we measuring whether the money that we are putting in is successfully tackling the problem?
I know that the Scottish Enterprise network has set itself targets for the number of new businesses to be formed by 2000. They were set three or four years ago. Other than that, I am not aware how that is being taken forward. In the context of the plan, we must provide targets associated with each of the individual priorities. One of those targets will be the number of new businesses created.
I do not deny that there are considerable difficulties in measuring the number of new businesses that are created—two basic measures are used. One uses new value added tax registrations and is, arguably, the more accurate, although it tends to miss out the large number of self-starting companies that are below the VAT threshold.
The second way, which Scottish Enterprise set up with the banks, is to collect new commercial bank account openings. The problem with that is mainly that it is directed at the Scottish banks. I am not sure whether the English banks, some of which operate north of the border, are included yet. In answer to your question, there will have to be an annual target for the number of new businesses that are created, which will have to be shown in the plan for each year.
It is easy to talk about employability, adaptability, entrepreneurship and equal opportunities, but there must be targets, so that we can measure whether the plan is providing value for money. That is important in the whole plan.
We are shy about discussing this area, because it concerns the black economy. When people open their first account after going into business, they do not open a business account. People do not live like that—we should introduce some realism.
That is personal experience—it is on record. [Laughter.]
I am talking about people I know.
Nobody is blaming the Scottish Executive for this. Italy managed beautifully without a plan such as this. We want value for money, so perhaps there could be a couple of wee sectional and geographical pilot projects. What will be judged is employment and consumer spend. I suggest that we think about judging the matter from another angle.
Dennis Canavan talked about exclusion. I am not sure about the priorities, as I thought that the main priority was to get to the folk who are increasingly being classified as the underclass and whose children are stigmatised for being from two or three generations that have not worked. That should be better defined as a priority. How much money will be spent on it? I appreciate that we cannot quantify the exact sum, because we do not know the global figure, but how is the amount that is spent on social exclusion and the employability of folk who have been unemployed for only six months worked out?
Because of the policy superstructure to which Heather referred—the national employment action plan, the European Union employment strategy, the EU guidelines and the regulation itself—we are relatively restricted in the main priorities that the programme can adopt. In other words, the Commission is saying that it will provide structural funds for matters such as social exclusion, employability and—if you like—the underclass, but that it wants us to organise our programme in such a way that the five priorities correspond to the five policy fields in the regulation, which in turn can be traced back to the four pillars of the EU employment strategy.
Having said that, it is extremely difficult to assess how much should be spent on one priority rather than another. The plan team has had discussions on how we allocate the finance down to priorities and measures. As you will appreciate, it is difficult to complete those discussions without knowing the total value of the programme.
I can provide you with a flavour of the plan team's thinking. First, we have acknowledged that priority 5 on equal opportunities and priority 3 on lifelong learning will be horizontal priorities, spread throughout the programme. There is perhaps less need to devote substantial resources under the relevant vertical priorities, not least because neither of those priorities will involve volume training, if I may put it like that.
We will need to spend substantially more on priority 4, on the competitive work force and entrepreneurship, than on priorities 3 and 5. However, the largest spenders are likely to be priority 1, on active labour markets, and priority 2, on social exclusion. In finalising the proposed allocations, the plan team will need to balance need and opportunity, as well as taking account of the strategic and policy context that Heather and I have discussed briefly.
I hope that that is helpful.
Does that mean that you will give more money to the folk who need it most?
That would be our intention.
I have a couple of questions. If I have understood you correctly, the plan team will work out the priorities on which the money should be spent. Is there a matching funding element, and have you made an assessment of where that funding will come from?
My second question follows on from what Irene said. The indicators and targets for all the measures proposed in the document are said to be
"the subject of a separate indicator, targeting and monitoring review".
Does that have to be in place by the end of October, when you have to submit the plan to the Commission? How will you achieve that? The point that Irene was making is that measurement is important to assess the progress that is being made.
The answer to the second question is a definitive yes. Before we can submit the plan to the Commission at the end of October, we must undertake a detailed exercise to work out performance indicators and targets, and how we will measure what we propose to deliver through the programme. I hope that that assuages some of the committee's concerns about measurement. This is a phased process, and the draft plan is the first element.
Has the methodology already been worked out? Is there a written document?
I would not go so far as to say that there is a written document, but we know what resources we have put into European social fund projects in the past and what outputs they have delivered. Once we have established how much expenditure we have to play with, it should not be too difficult to make a reasonable assessment of the outputs, targets and indicators.
The real problem for the plan team is that demand for ESF under the new objective 3 will substantially exceed the expenditure available. We will not have particular trouble with match funding, because the range of partners includes further and higher education institutions, local authorities, the Scottish Enterprise network and the voluntary sector, all of which are able to contribute match funding. Indeed, over the years during which the social fund has been in operation, match funding has not usually been a significant problem.
Are you quite sure about that?
It is not much of a problem in relation to objective 3, compared with other programmes—I think that I know which programme you are thinking about.
I wanted to ask a question about priority 4:
"Supporting A Competitive Workforce And Developing Entrepreneurship".
I was pleased to hear you mention community businesses as part of that. I have a particular concern about areas in which there has been long-term unemployment and where the infrastructure is not as good as in other places. To create sustainable jobs, we might have to look towards supporting and developing what already exists in communities. Have any targets been set for the percentage of funding that might be allocated to supporting community businesses, co-operatives or the social economy? Can you give me some feedback on how a kind of social entrepreneurship might progress?
We have to quantify all the elements and target groups in the programme. We need to refer to relevant research and, as part of the consultation process, to sound out key partners about what would be realistic targets and where we should focus the resources.
The types of activities that you mention are not just picked up in one part of the plan. You mentioned priority 4 because I mentioned community businesses, but we have included capacity building with a community development slant to address social exclusion and the entrepreneurship part of the same priority 4. We want to encourage those who would fall into socially excluded groups to be more entrepreneurial and to take up opportunities in self-employment, for example. That point is taken on board, but actual targets are part of the exercise to which we referred earlier.
May I respond to the point on self-employment? People who have gone down that route have said that the help that they get at the beginning is very useful—you know what I am going to say—but it is different a year or two down the line when they are struggling. Will there be any recognition of that, particularly in areas where there has been a high incidence of social exclusion? Self-employment is not something that people jump into and are then able to manage within six months. Is any thought being given to a longer-term approach to sustaining people who choose that option?
Absolutely. That is one of the lessons learned from previous structural fund programmes and it has been taken on board, as have many other aspects. The aftercare concept is reflected in the detail of the plan. We are talking about a follow-up of about six months' support for people who go into self-employment and for individuals who become employed. It is not only about getting individuals into employment, but about on-going mentoring schemes. That is a very fair point, and it has been made strongly to us throughout the consultation process.
Heather, I would like to come back to the measures issue. The committee has discussed before the need for the public in Scotland to better understand the impact of the European Union and its funding on Scotland. I would like to be sure that the measures that you are putting in place will be capable of demonstrating that the programme has made a difference—not that so many new businesses have been created or that we have improved on equal opportunities; after all, the Executive has established targets for itself. How will you show that the programme has made a difference in any of those areas?
We will build on the awareness raising that we do and on the best practice information that we disseminate within the current objective 3 programme.
Yes, but will you be able to measure that, because of the programme, there are 120,000 new businesses instead of 100,000?
Yes—in a sense it is a promotional issue; raising awareness of what the programme has actually achieved.
I meet many people who comment on all the European money that has been dispensed and want to know what has been achieved. You can produce a list of projects, but it is difficult to say that they have made a difference.
That comes back to the question that Irene asked about whether there would be targets and measurement of those targets, so that you could be held accountable. I think that you said yes.
Yes.
You certainly said yes earlier on; have you changed your mind?
I must point out that it is very difficult to disentangle the impact of the European structural fund programme from happenings in the general economy. Arguably, the overall economy has far more impact in terms of the number of new businesses created and the levels of employment than anything that the European social fund might do. That does not mean that we do not have to measure what we are setting out to achieve.
Yes. That was the question that was being asked, and you said that you would be measuring.
Convener, you asked a question earlier to which I did not respond. It concerned the geographical weighting that we might want to give in the programme. It might be helpful if I said a couple of words about that.
As you might expect, the new objective 3 programme will have to take into account the new objective 2 areas. Bearing it in mind that the scope for programming European social fund expenditure in the new objective 2 programmes will be strictly limited—much more so than under the present objective 2 and 5b programmes—the new structural fund regulations require that the objective 3 resources should be concentrated on the new objective 2 areas.
In addition, we believe that we will be able to have a measure of concentration of objective 3 resources in the areas that will lose objective 2 and 5b status—the so-called transition areas—which will benefit from transitional programmes. Those programmes will not contain any European social fund expenditure.
We have to use objective 3 to pick up the losses in the new objective 2 and transition areas. It is difficult to come up with an adequate statistical rationale to reflect the different ESF needs of the new objective 2 areas, the transition areas and the non-designated areas. We believe that the numbers of unemployed people in the respective area categories are as good a measure as we are likely to get. Once we know the identity of the new objective 2 areas, we will need to reassess the position, but I wanted to assure the committee that appropriate provision will be made to ensure that the new programme will be focused on geographical areas of need.
On areas of need, you said that areas that are in need but do not quite qualify under the new objective 2 will still be eligible for assistance.
We need to provide special assistance—perhaps a higher level of assistance—to areas that are losing out on objective 2 or 5b status—
So that those areas can still qualify for objective 3?
The entire country, with the exception of the Highlands and Islands, can qualify for objective 3. It is a question of giving higher priority to the new objective 2 areas and a slightly lower priority to the transition areas, while the lowest priority will go to the areas that are not designated.
In the draft plan, schools are mentioned only as part of the equal opportunities strategy and in connection with raising employability. We know that equal opportunities issues arise in schools, particularly when children make the wrong subject choices with the result that they cannot access the employment that they had hoped for. That might happen because boys always choose the boys' subjects while girls always choose the girls' subjects. The plan mentions schools, so I assume that you will have some input to that subject. What are your proposals?
Two issues are involved. On employability, I mentioned that we would target young people who are about to leave school with a preventive approach. Along with effective mainstreaming of equal opportunities, that should encompass some attitudinal changes. The main focus, as Maureen Macmillan rightly said, will be within the equal opportunities strategy. We are about to include additional research, which is broken down by age and which monitors attitudinal change and where young people go in sectors where, traditionally, there is a gender imbalance. We are building that into the plan and considering what activities will be covered. On gender imbalance, we need to take a preventive and more proactive approach, rather than just addressing what has happened already.
Youngsters at that age are very conscious of their gender; we have to overcome that when we advise them on career choices.
I notice that you also said that transport difficulties would be taken into account. I know that that does not cover the Highlands and Islands, where transport is a particular problem—I dare say the same applies in other rural areas—but perhaps young folks cannot access the new deal because there is no public transport to enable them to travel the necessary 12 or 20 miles. How do you propose to help?
In a sense, the earlier comments about appropriate support measures for target groups apply here. If project beneficiaries who are aged between 15 and 24 or people who are not on the schemes need extra help to access training, they will be eligible for ESF assistance.
We are aware of difficulties in accessing transport in rural areas. I hope that by a combination of those two things that—
You could make a difference.
Yes.
I want to make two points. The first one has been raised by the convener, Irene, Tavish and a few others, and relates to the measurement of achievements. There must be a starting point. To what extent are we able to pinpoint—from information on past successes or failures that we presumably have—where we are now and where we expect to be at the conclusion of the process? Small to medium enterprises are an example of where the Scottish economy is structurally weak. What is the starting point for them, and how are we to measure the success or failure rate of the programme?
My second point concerns the division of strategic objectives 3 and 4. If the priority is to develop a culture of lifelong learning, should not objectives 3 and 4 be combined? That might seem like a tongue-in-cheek contribution to European simplification, but many people—including me—believe that the way to build a competitive economy is to develop the knowledge economy. If you are developing new systems and approaches for training, inevitably workplace training is included with all other forms of training, so the two objectives ought to be combined.
I will deal with your second point first. The distinction that the plan team has made between priority 3, which is lifelong learning, and priority 4, which is adaptability and competitiveness of the workforce, is that priority 3 is directed mainly at systems development and soft infrastructure, whereas priority 4 is directed at training the work force of the Scottish economy. I admit that the distinction is, to some extent, artificial, but we have organised it in that way so that we can include lifelong learning as a horizontal priority in approaching the competitive work force, while distinguishing between lifelong learning and competitiveness for the purposes of applicants. That is why we suggested that lifelong learning would not be concerned mainly with volume training, but would be geared much more towards systems development and soft infrastructure, as I said.
Your question on measurement leaves me in some difficulty. In broad terms, at the simple level, we know where we are in the market needs analysis. There is much in the document about market needs, unemployment, sector breakdowns and so on. I do not see any major difficulty in having output targets that reflect the inputs that we will make. There are difficulties of definition and changes are taking place, but I do not see any difficulty in developing suitable indicators and targets that will enable us to measure our performance and that of the programme.
The drift of Allan's question and other similar ones reflects a concern that, unless you can tell us what you intend to achieve, and unless we are able to measure what is achieved, the whole process will be wide open, and you could say that whatever you achieved was a success.
I entirely agree with that. When the programme comes back to the committee, it will contain annual performance indicators and targets so that, at the end of the first year, we can look at it with the Commission and say, "Well, our target was to achieve so many people into jobs or full-time education. This is what we actually achieved, compared with the target."
I do not want to talk about targets at this stage, because I am sure that, if the US economy goes into meltdown, the targets will go to hell. I am not sure that we can tell very much from them because of all the outside influences and environmental concerns that will come to bear.
I am struggling with some of this—simplification is the answer for me. I cannot get my head around the paradoxes, in terms of what is happening under objective 3 as compared with objective 2. Throughout the background analysis on objective 3, indicators tell us that the Scottish gross domestic product remains consistently below UK levels, that the increase in self-employment rates is low compared with that in the UK and that there are issues where, in comparison with the UK, we are not doing well.
However, I understand that, in the objective 2 process—which will drive much of the objective 3 process—Scotland will suffer fairly badly compared with England because of Scotland's supposed relative wealth compared with areas of England. I cannot square that circle, although perhaps there is a way of doing so. In a paper that came to an earlier committee meeting on European structural funds—
We will come back to the discussion on objective 2, as we should receive the Scottish Executive's statement soon. We also need to have a further discussion with the Minister of Finance on the points that he raised and that are referred to in the document that you mention, Bruce, as we need further clarification. I do not want this debate to trespass on to objective 2 matters—they must be kept separate. Remember that this is a briefing session and that we will have the opportunity to question the minister.
I understand. My worry is that much of the objective 3 spending will be driven by what happens with the objective 2 maps. That is what David is telling us. There is a paradox somewhere. Perhaps you can explain that to me, David, and make it all lucid.
Well, no, Bruce. You are getting into an area about which we need to question the Minister of Finance. The officers are here to talk about the policy parameters in, and the strategic aims of, the draft programme, which is what we should be concentrating on. Your legitimate questions need to be addressed to Jack McConnell, along with further concerns about the paper that has been circulated.
David, can you answer any of Bruce's questions just now?
I will try not to infringe your ruling, convener.
Broadly speaking, whatever happens on objective 2, the fact remains that, even though objective 2 coverage will be reduced in Scotland, a significantly greater proportion of our population will be covered by objective 2 than will be the case in England.
That helps.
I do not want to go into objective 2 any further now—this is complicated enough.
I have one final question—it has nothing to do with objective 2, I assure you. The Scottish plan is set in the community support framework for objective 3. How does that link into the UK national plan? That is what I cannot understand. I know that we are still to receive the UK national plan—we have asked for it.
The UK national employment action plan is a response to the EU's annual guidelines, which are published and available. If members wish to see it, I am happy to arrange for it to be submitted to the committee.
Please.
I am afraid that it is a great, weighty document that is fairly general in terms of what it says about the way in which the UK Government approaches employment matters. Below that, there is a community support framework for objective 3, which describes the main priorities of the UK objective 3 operational programmes. Each programme will share the same main priorities. The document is fairly permissive. It does not restrict us in what we want to do. Members have our operational programme in front of them. In this, we are able to pick out what we regard as the Scottish priorities.
I can find where the anchors are now. Thank you, David.
I suggest that we ensure that a copy of the document is submitted to SPICe in Parliament headquarters. If anyone wants a copy, they should speak to Stephen.
At the start of the meeting, Heather, I asked about policy fields. Where would they differ from previously?
Do you mean in terms of what was previously covered by current programmes?
Yes.
In a sense, the current objective 3 programme covers activities that combat long-term unemployment, tackle social exclusion and promote equal opportunities between men and women. Those themes are still prevalent in the new objective 3 programme. The current objective 4 programme is about training the work force and adaptability. The objective 2 and objective 5b programmes are about upgrading the current skills base. The new objective 3 programme picks up on all those things, which is why its scope is so comprehensive. The themes are broadly the same, but equal opportunities are highlighted even more strongly in the new programmes.
I thank both Heather and David for their contributions, which will help to inform us in the next stage of our discussion. The Scottish operational programme draft plan for objective 3 expenditure has also been circulated to other relevant committees for comment, which will be fed back to us once they have had a chance to consider it.
There is also a longer-term issue. I do not consider our consideration to be a mechanical exercise. A lot of good information was presented by the witnesses and that could take back into many communities the debate on what funding might be accessed, on what kind of groups might receive support and on what kind of initiatives we could help to develop. I want to see how we can assist in making the programme effective throughout Scotland. No doubt, Heather and David, we will have further discussions with you in future. Thank you.