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Chamber and committees

Meeting of the Parliament

Meeting date: Wednesday, May 3, 2023


Portfolio Question Time

Wellbeing Economy, Fair Work and Energy

The Deputy Presiding Officer (Liam McArthur)

Good afternoon. The first item of business is portfolio questions on the wellbeing economy, fair work and energy. As ever, I invite members who wish to ask a supplementary to press their request-to-speak buttons during the relevant questions and I ask for brevity in questions and responses.

Energy Skills Passport

To ask the Scottish Government what progress has been made on the energy skills passport for offshore energy workers. (S6O-02164)

The Minister for Green Skills, Circular Economy and Biodiversity (Lorna Slater)

The energy skills passport project, for which we have committed nearly £5 million from the just transition fund, reached a key milestone at the end of in 2022 in the development of a prototype that will be tested with workers and employees in the next phase.

I am pleased that trade unions have been engaging their workforces in the design of the passport solution, and unions are representing workers directly as part of the project review group for the passport.

The Scottish Government supports delivery of a skills passport that will work for the different offshore energy industry sectors, recognising the cross-sector skills of workers and supporting a fair and managed transition. The offshore industries, including wind, have also demonstrated clear support for a solution that works for all and promotes a fairer transition in offshore energy.

Mercedes Villalba

As the minister will know, the energy skills passport was due to launch in the first quarter of this year. We are now in May. The unexplained delays are reportedly due to opposition from the Global Wind Organisation—GWO—which is the offshore wind standards body. In the meantime, offshore workers continue to face barriers to transition.

Will the minister use her role and position to intervene and chair a crisis summit, which would include the Offshore Petroleum Industry Training Organisation, the GWO and the offshore trade unions—the National Union of Rail, Maritime and Transport Workers and Unite—to resolve that crisis, end the delay and give offshore energy workers the certainty that they need in order to transition?

Lorna Slater

I support Mercedes Villalba’s call for the skills passport to be delivered in a timely fashion because we all want to support workers in a just transition.

Excellent progress is being made on that project. As I said in my first answer, the proof of concept and prototype of the skills passport was completed and signed off by union reps in December. We are progressing with a mapping exercise—mapping the alignment of standards—which is a big piece of work that will bring together in one place the standards from multiple offshore sectors. Currently, we are looking at the mapped equivalent of about 75 per cent of the core crew for an offshore installation, so that work is progressing well.

The project is moving into preparations for beta testing of the prototype, with the intention being to deliver the skills passport to end users in quarter 3 of this year.

Liam Kerr (North East Scotland) (Con)

Offshore wind was mentioned as a possible transition route for offshore energy workers. Ten years ago, the Government promised to deliver 28,000 jobs in offshore wind; by 2021, it had delivered just over 3,000. What action has the Government taken to examine the reasons why it has failed so badly, and to ensure that the promise of 28,000 jobs can be delivered?

Lorna Slater

We are all keen for the offshore energy sector to have a just transition away from oil and gas to renewable energy, in which Scotland has so much potential. The creation of the offshore skills passport is a key part of that process because it will, as it reduces the time and costs that are required for training, remove barriers so that workers can make the transfer between the sectors more simply and efficiently to allow the just transition.

The added benefit is that the passport tool will, when in use, give good visibility of potential career pathways and training needs, which relates to the desired goals in the sector to help businesses to plan their workforces and workforces to plan for the roles that they want.

Beatrice Wishart (Shetland Islands) (LD)

Renewables is an important and growing sector, but some uncertainty remains for workers who have the desired skills because equivalent certification can be expensive. What support is available to offshore workers who are looking to transfer their skills?

Lorna Slater

As I have just outlined, that is the whole purpose of the offshore skills passport, which means that various offshore sectors have agreed to align their standards. The passport will show the standards to which the worker can adhere in order for them to transition and move back and forth between different offshore energy sectors. That is exactly the purpose of the passport.

Question 2 has been withdrawn, so I call question 3.

Women in Entrepreneurship

To ask the Scottish Government what action it is taking in response to the recommendations of the independent review into women in entrepreneurship in Scotland. (S6O-02166)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

We welcome the recommendations of “Pathways: A New Approach for Women in Entrepreneurship”—Ana Stewart and Mark Logan’s review on supporting women in entrepreneurship. The challenge is clear: there remains an unacceptable gap in participation in entrepreneurship. The report offers a clear path to closing that gap and supporting women to achieve their business ambitions, by opening up economic opportunities for women and contributing to building a fairer and more prosperous wellbeing economy for Scotland.

We are assessing and prioritising the report’s proposals and preparing our response, which I hope to publish in due course.

Claire Baker

Thank you. The “Pathways” report was published in February, and it identified 31 ways to dramatically increase female participation. The then First Minister said that the Government would respond quickly to those recommendations, yet when the new First Minister spoke about his Government’s priorities, he did not mention the review at all. Although the cabinet secretary has indicated that we can expect a response soon, I would like to know when we can expect it and when the recommendations will be taken forward, including with regard to the need for a women’s business centre.

Neil Gray

I thank Claire Baker for that question and for her work on the committee and the cross-party group for women in enterprise. We have a huge economic opportunity before us, if we can close not just the gender pay gap and the gender employment gap but the gender gap that exists in new enterprises being established in Scotland, which is pertinent to the question.

Of course, we will respond to the report as quickly as possible. We also have a commitment to the women’s business centre, so I am very excited about the opportunity for us, if we can close the gap and ensure that we are giving women the opportunity to get on in business.

Household Energy Costs

4. Jim Fairlie (Perthshire South and Kinross-shire) (SNP)

I welcome the minister to her new role.

To ask the Scottish Government what its latest engagement has been with the United Kingdom Government regarding financial pressures that households in Scotland are facing as a result of energy costs. (S6O-02167)

The Minister for Energy (Gillian Martin)

The disproportionate impact of high energy prices on fuel-poor households across Scotland is something that I am raising as a matter of urgency with the United Kingdom Government. Although I am disappointed that earlier requests from Scottish ministers to meet the secretary of state were not answered, I aim to meet the Minister for Energy Consumers and Affordability soon to seek action from them on issues including support for those who have been most affected by the ending of the energy bills support scheme, and the introduction of a much-needed social tariff for energy consumers.

Jim Fairlie

I thank the minister for that answer. According to the Office for Budget Responsibility, the UK is expected to suffer the biggest fall in living standards since records began in 1950, with real household disposable income being expected to fall by 5.7 per cent over 2022-23 and 2023-24. Last week, I held an energy summit in Perth, at which experts from Citizens Advice Scotland, Home Energy Scotland, Scarf and Perth and Kinross Council shared information on and solutions for saving money on fuel bills and cost of living pressures.

What else can the Scottish Government do to press the UK Government to relieve the pressures that its economic mismanagement has introduced for far too many of my constituents?

Gillian Martin

I thank Jim Fairlie for his supplementary question, and I commend him for the work that he is doing to help his constituents.

As I said, we have called repeatedly for action from the UK Government—including ahead of the spring budget review, when a real difference could have been made—but it has failed to deliver. In addition to the meeting that I hope to have with the UK Minister for Energy Consumers and Affordability, I will be progressing work that was delivered as a result of the Scottish Government’s energy summit last year. I intend to give us and our partners in Scotland a stronger combined voice, which we will continue to use to challenge the UK Government on the need for more action to support those who are most in need.

I recommend that Mr Fairlie and all MSPs signpost any constituents who are having real difficulty paying their bills to Advice Direct Scotland, which is administering the Scottish Government’s home heating support and whose offices I visited yesterday.

We have tripled our fuel insecurity fund, but as Mr Fairlie alludes to, the core cost that is affecting families needs to be tackled by the UK Government, which has the powers to make a real difference in that area.

Sarah Boyack (Lothian) (Lab)

Has the Scottish Government discussed the potential for a UK windfall tax—given the unprecedented energy profits that are being made—and the Scottish Government’s plans for the energy company that it was proposing to establish? Will that be on the agenda with the UK minister, because we need to accelerate plans to invest in energy-efficient homes in Scotland in order to eradicate fuel poverty, to lower bills, to create jobs and to deliver on net zero. Would not that be a practical way to get going on that?

Gillian Martin

A lot practical things could be done by the United Kingdom Government a lot sooner than some of the things that Sarah Boyack mentioned. Given that we in the Scottish Government really have powers only with regard to helping people to make their homes more energy efficient, that is where we are directing a lot of our powers and funding.

As I mentioned, we have built on the commitment to double the fuel insecurity fund. Our winter heating payment replaces the Department for Work and Pensions’ cold weather payment with a reliable annual £550 payment that is helping around 400,000 low-income individuals with their heating expenses.

Many of the powers that are required for a lot of the things that Sarah Boyack mentioned in relation to energy companies sit, at the moment, with the UK Government. Last week, I had a meeting with Andrew Bowie, who is the UK Minister for Nuclear and Networks at the Department for Energy Security and Net Zero, about some very small constitutional issues that might be able to help us to do a lot more in this area, but which need to be devolved to this Parliament.

Briefly, Willie Rennie.

Willie Rennie (North East Fife) (LD)

In Scotland, 600,000 homes are in extreme fuel poverty—but last year only just more than 5,000 households were helped by the Government with the insulation programme. This year’s warmer homes scheme will not even open again until October. Why is the Scottish National Party-Green Government so slow on insulating people’s homes?

Gillian Martin

Our national fuel poverty scheme, warmer homes Scotland, is designed to help those who are living in or are at risk of fuel poverty. Unfortunately, in the past year or so, many people who were not in fuel poverty have been plunged into it—not because of the actions of the Scottish Government but because of increasing fuel costs and the increasing cost of people’s energy bills. We are ploughing in money to mitigate somewhat the crisis, but if we had some real action on bringing down the cost of people’s fuel in the first place, we would not be in this situation.

Tayside Aviation (Closure)

5. Michael Marra (North East Scotland) (Lab)

To ask the Scottish Government what impact it anticipates that the reported closure of Tayside Aviation will have on the financial sustainability of Dundee airport and associated Tay cities deal funding. (S6O-02168)

The Minister for Small Business, Innovation and Trade (Richard Lochhead)

I say at the outset that I am very concerned to hear of the job losses at Tayside Aviation. My thoughts are with the workers affected and their families.

The Scottish Government remains committed to providing Highlands and Islands Airports Ltd with sufficient support to maintain operations at all 11 of its airports, including Dundee. Scottish Government officials will discuss the implications for the Tay cities region deal with both local partners and the United Kingdom Government.

Michael Marra

That the closure of Tayside Aviation does not threaten the future of the airport is of vital importance to Dundee, and I thank the minister for his assurance. Of course, it will be cold comfort to the 22 people who have lost their jobs.

Will the minister update Parliament on what the Government is doing to support the aviation academy for Scotland project and the Tay cities region deal project? What actions has he taken? Most important today, what assurances can he give those people who have paid money as students and who have lost the future that was in front of them? Has he had discussions with the Royal Air Force about the crucial contract that was in place—or which should have been in place—with the aviation academy? Will he meet me to discuss those really important issues?

Richard Lochhead

I would be happy to meet Michael Marra to discuss those issues. I will also certainly check out his point about the RAF.

On his other two more general questions, it is important to say that no Scottish Government funding went directly to Tayside Aviation in support of students. University students should have been contacted directly by their own universities. Scottish Government officials have been engaging with Middlesex University and the University of Central Lancashire, in particular, as delivery partners for the courses to understand what contingencies are in place to support those students who are most affected.

The wider aviation academy project, which is part of the local region deal, is a UK project of £8.1 million. Although the unfortunate business closure that we are talking about in Parliament today will certainly impact on the project’s future development, we want to continue to work with regional partners on exploring alternative viable delivery options.

As Michael Marra confirmed in his own remarks, we can confirm that funding will not be lost to the region and that we will continue to do what we can to support the airport.

Murdo Fraser (Mid Scotland and Fife) (Con)

At last week’s First Minister’s question time, I raised the issue that Michael Marra has just referred to about students, many of whom have paid large sums in fees up front for degree courses that were being partly delivered by Tayside Aviation. That is a huge financial issue for them, but the other question is how they can complete their degree courses without the provision of training local to their home base in Scotland. Does the minister have any suggestions as to what alternative provision might be made available to students caught in that situation?

Richard Lochhead

I recognise the member’s interest in the issue. As I indicated in my previous answer, officials are in contact with the relevant universities to look at what alternative plans will be put in place and to discuss the wider implications of what has happened. I think that the best thing for me to do would be to speak to my colleagues and to drop a note to those local members who have an interest in the issue and its implications for the students concerned. We will provide an update as soon as we can.

Disabled People (Employment)

To ask the Scottish Government whether it will provide an update on its interim goals of reaching 50 per cent of disabled people in employment by 2023 and 60 per cent in employment by 2030. (S6O-02169)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

The latest available Office for National Statistics annual population survey data indicates that, in the year from January to December 2022, the employment rate for disabled people in Scotland had increased to 50.7 per cent, from the previous year’s figure of 49.6 per cent. That means that we have achieved one year early our first interim target of 50 per cent of disabled people being in employment, and we are currently on track to achieve the subsequent target of 60 per cent by 2030. The refreshed fair work action plan that was published last December sets out the further actions that we will take to meet our aim of halving the disability employment gap by 2038.

Stephanie Callaghan

ACS Clothing in my constituency has recognised that standard interview processes often exclude disabled people from securing jobs right at the outset, and the company’s inclusive approach has helped earn it disability confident leader accreditation. What further action will the Scottish Government take to support an increase in the number of employers practising inclusive and accessible interview processes, with a view to more local employers recognising and benefiting from the talents that disabled people bring to our workplaces?

Neil Gray

I thank Stephanie Callaghan for her question and, indeed, for her work through the cross-party groups on autism and learning disability to support the improvement of disabled people’s lives. I also congratulate ACS on the work that it is doing to create an environment in which disabled people can partake in and benefit from inclusive and accessible interviews.

The Scottish Government believes that a culture change is required for employers to have the competency and confidence to offer appropriate support to disabled people in order to access work. To date, we have invested close to £1 million in a public social partnership that is working to improve recruitment and retention rates for disabled people by developing and testing different types of support for employers. Through that partnership, ACS was supported to attain the accreditation that Stephanie Callaghan has referred to.

Last year, we commissioned a disabled people’s organisation to deliver a programme of training and development on disability inclusion and, equally, to do so on a test-and-learn basis in two fair start Scotland contract areas. The programme includes development of accessible interviews.

Does the Government plan to produce a refreshed employment action plan that will reduce the disability employment gap and address the challenges of the post-Covid labour market?

Neil Gray

I am certainly happy to consider that. We must recognise the impact that Covid has had on disabled people entering the employment market.

I am also happy to work with Jeremy Balfour and others to ensure that the United Kingdom Government is living up to its responsibilities in this area. I am old enough to remember the UK Government having a target to halve the disability employment gap. Sadly, that is no longer the case.

Question 7 has been withdrawn.

Granton Waterfront

To ask the Scottish Government how it is supporting the regeneration and development of Granton waterfront. (S6O-02171)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

The Scottish Government is represented on the Granton waterfront strategic partnership, which enables regular engagement with the City of Edinburgh Council and partners on the development and delivery of their plans for the regeneration of the Granton waterfront area. Through the partnership, we are able to discuss ways in which collaborative cross-portfolio support can be provided for the on-going development and delivery of the place-based vision for Granton. That support has included investment of more than £9 million in the early phases of the development, to help unlock sites and support development of the Western Villages demonstrator project.

Ben Macpherson

I thank the cabinet secretary for that answer and for the funding that the Scottish Government has committed to and the engagement that it has taken part in so far.

As the regeneration of Granton waterfront has remarkable further potential to deliver on multiple wellbeing, economy and social justice policy objectives, I ask the Scottish Government to consider how it could further support that nationally significant development project in a holistic way. As part of that, I ask it to consider how a process could be developed to allow a multiyear package of Government funding to be secured in order to meet the multiple policy objectives and deliver new housing, facilities and opportunities for the benefit of north Edinburgh, visitors and our capital city as a whole.

Neil Gray

I thank Ben Macpherson for his diligence as the local MSP for Edinburgh Northern and Leith and for bringing this important issue to the chamber. The Scottish Government is working with the Granton waterfront strategic partnership and providing support from the range of portfolios involved in delivering a place-based approach to the regeneration of Granton. That includes support for and advice on the completion of robust business plans by the partnership to identify the funding that will be required from a range of sources, including private investment. I would, of course, be happy to meet Ben Macpherson to discuss his suggestion and any further ideas that he might have.

Miles Briggs (Lothian) (Con)

I am sure that the cabinet secretary will agree that the United Kingdom Government’s levelling up funding of more than £16 million to restore and reopen the B-listed Granton gas holder is a welcome investment and can act as a catalyst to support the regeneration and redevelopment of Granton and the whole city waterfront. What work is the cabinet secretary doing to help with the next set of levelling up funding projects and make sure that every part of Scotland, especially Edinburgh’s waterfront, realises that potential?

Neil Gray

Of course I welcome that funding. Miles Briggs would, of course, expect me to challenge the levelling up fund on the basis that it has not been as targeted as I think that it could be, nor has it matched the levels of expenditure of the predecessor funding that came through our membership of the European Union. I will be looking to meet the UK Government to discuss the next phase of the levelling up fund, to challenge it to go further, to ensure that investment meets devolved priorities and to ensure that we are no longer cut out of the decision-making process.

That concludes portfolio questions on wellbeing economy, fair work and energy. Before we move to the next portfolio, there will be a brief pause to allow front-bench members to change places.

Finance and Parliamentary Business

The Deputy Presiding Officer

The next portfolio is finance and parliamentary business. I invite members who wish to ask a supplementary question to press their request-to-speak buttons during the relevant question, and I again make the usual appeal for brevity in questions and responses.

Section 35 Order (Costs of Legal Challenge)

1. Annie Wells (Glasgow) (Con)

To ask the Scottish Government how much it has allocated from its budget to cover the costs of its challenge of the decision of the United Kingdom Secretary of State for Scotland to issue an order under section 35 of the Scotland Act 1998 in respect of the Gender Recognition Reform (Scotland) Bill. (S6O-02172)

The Deputy First Minister and Cabinet Secretary for Finance (Shona Robison)

We consider that challenging the UK Government’s use of section 35 is the only option for a Government that wants to uphold and defend the democratic will and devolved powers of this Parliament. At this stage, it would be entirely speculative to comment on what the costs of the challenge would be or who would meet them. Any costs that are incurred by the Scottish Government will be published in due course.

Annie Wells

Most of the Scottish public remain opposed to the GRR bill. The wider gender self-identification policy contributed to the downfall of Nicola Sturgeon when she housed a male double rapist in a women’s prison. It is a deeply flawed policy, and many Scots supported the UK Government’s blocking of the bill. It appears that the sole reason why the Scottish National Party Government is sticking with it is to pick a fight with the UK Government, alongside keeping the extremist Green Party happy.

Is it truly worth wasting hundreds of thousands of pounds of taxpayers’ money on something that is likely to be defeated in the courts and that most Scots, including one quarter of SNP voters, oppose?

Shona Robison

Let me remind Annie Wells that the bill was passed by an overwhelming majority of the Scottish Parliament, with support from members of all parties. The use of section 35 is an unprecedented challenge to the Scottish Parliament’s ability to legislate on devolved matters and risks setting a dangerous constitutional precedent by allowing a veto on this Parliament’s democratic decisions. It is absolutely important to have clarity on the interpretation and scope of the UK Government’s section 35 power and its impact on devolution. Those matters and the use of the powers should be legally tested in the courts.

The mention of taxpayers’ money is a bit ironic in a week when the head of the United Kingdom’s Debt Management Office has said that the mini-budget cost the UK an eye-watering £74 billion, of which Scotland’s share would be more than £6 billion. Of course, that was through a Government that was supported and enabled by Annie Wells and her colleagues.

I will not take any lessons from Annie Wells or the Tories about the use of taxpayers’ money in the face of the eye-watering amount that was wasted by the UK Government.

Colin Beattie (Midlothian North and Musselburgh) (SNP)

Despite the UK Government’s claim to have concerns about the bill, it is my understanding that it has, as yet, refused to engage with the Scottish Government or the Scottish Parliament to attempt to resolve those concerns. Does the cabinet secretary agree that, if the Conservatives have concerns about the costs of challenging the section 35 order, they could start to address them by pressing their colleagues at Westminster to actually engage with the Scottish Government on the bill, rather than undemocratically attempting to block it?

Shona Robison

That is correct. After the Secretary of State for Scotland made the section 35 order, I met him and proposed that our Governments work together to clarify and seek to address any specific concerns. He refused any further engagement and offered only three options: we could drop the bill; address his concerns in an amended bill, but with no indication of which areas the UK Government would want to be amended; or pursue legal action.

The legal challenge is not what we wanted to happen with the bill, after it was passed—as I said earlier—by an overwhelming majority of the Parliament, but we have been left with absolutely no choice in the matter. Of course, the UK Government could avoid those legal costs by revoking the section 35 order; we would then gladly resume dialogue with it on the issue.

Capital Budget (Impact of Infrastructure Project Delays)

To ask the Scottish Government what financial assessment has been made of any impact on the capital budget of delays in delivering infrastructure projects. (S6O-02173)

The Deputy First Minister and Cabinet Secretary for Finance (Shona Robison)

The Scottish Government continuously reviews the impact that factors such as project delays, inflationary pressures and market conditions have on our capital programme in order to ensure that Scotland’s money is being spent in the right places. That is done through the annual budget process, and periodically with our six-monthly reporting on the infrastructure investment plan.

The “Scottish Budget: 2023-24” set out over £6.3 billion of capital spending to support employment and the economy through our large-scale infrastructure plans to move us along the path to net zero carbon emissions and underpin the provision of quality public services.

Jackie Baillie

We know that the cost of infrastructure projects has risen, partly due to inflation, partly due to the availability of materials, and partly due to not having enough construction workers. That will lead to cost overruns and delays. We are already seeing that with the national treatment centres and projects such as the replacement St Brendan’s hospital on Barra, which was promised by Nicola Sturgeon in 2007 and has now been completely cancelled. Will the cabinet secretary commit to publishing a list of all capital projects, with revised costs and timelines, before the start of the summer recess?

Shona Robison

Jackie Baillie is quite right to point to all the pressures that are impacting on capital budgets. She mentioned inflation, labour costs and the cost of materials, all of which are absolutely factors. In addition, we have the combined effects of Covid, Brexit and the war in Ukraine, and the flat and falling capital grant allocation that Scotland has received from the United Kingdom Government. That is all putting pressure on our capital programme.

We will continue to work through the capital projects, many of which—as Jackie Baillie will understand—are at different stages. Many are well advanced and some are at an early stage. We will of course inform Parliament of any major changes to the capital programme.

There are a number of brief—I hope—supplementaries. The first is from John Mason.

John Mason (Glasgow Shettleston) (SNP)

The cabinet secretary mentioned inflation. Can she say anything more about that? It seems that the UK, with 10.1 per cent inflation, has a higher rate of inflation than Italy, at 8.3 per cent; Germany, at 7.2 per cent; and France, at 5.9 per cent. What is different about the UK?

Shona Robison

John Mason makes an important point. One of the key differences is the issue of Brexit, which has exacerbated all the global factors. There are also the UK Government’s economic policies, such as the mini-budget to which I referred earlier, which is costing the UK £74 billion. Those issues will impact on our budgets. Building materials were increasingly hard to source last year, and price inflation in the sector peaked at around 25 per cent last summer.

All those issues will impact on our capital budget, but we will ensure, through the difficult choices that we will inevitably have to make, that we prioritise our capital budget according to the clear priorities that have been set out. The prospectus that was launched by the First Minister reiterates what those priorities are.

Liz Smith (Mid Scotland and Fife) (Con)

In relation to Jackie Baillie’s question, is the cabinet secretary aware of concerns that have been raised at the Finance and Public Administration Committee by former ministers and former civil servants that when it comes to financial decision making, financial rules have sometimes been seen as “optional”? I ask that when she looks at infrastructure projects, that matter is also addressed so that we clearly see what the rules are supposed to be.

Shona Robison

I look forward to giving evidence, along with the permanent secretary, on matters relating to decision making for ministers and the advice that is given by the civil service.

I do not recognise some of the characterisation in Liz Smith’s comments. In my experience as a minister for more than 15 years, decision making is very robust, not least because the advice that we commission and receive is the best advice available to ministers.

Does that mean that decisions are always correct in light of things that later occur? Of course any Government will face issues when decisions are made on the basis of the best available advice at the time but circumstances change thereafter. I look forward to getting into more of the detail of that at the committee’s evidence session.

Willie Rennie (North East Fife) (LD)

Last year, the Auditor General, talking about the late ferries, said that there had been

“A lack of transparent decision making, a lack of project oversight and no clear understanding of what significant sums of public money have achieved.”

This year, the Government has admitted that the bosses were paid big bonuses that the Government had no clue about, and that the crew has been paid £1.6 million for ferries that cannot sail. Has the Government learned a single thing in the past year?

Shona Robison

Yes, we have, and ministers have apologised for the delay to the ferries and for the distress and difficulties that have been caused. The delivery of six new major vessels to serve Scotland’s ferry network by 2026 is of course a key priority for the Government.

The issue of bonuses has been gone over in fine detail. I wrote to the Net Zero, Energy and Transport Committee on the latest issue. On remuneration packages, the new chair of Ferguson Marine has been very clear that, going forward, bonuses will not feature in those packages, but those legacy bonuses could unfortunately not be avoided, due to contractual issues.

I am happy to write to Willie Rennie with more detail on the issue of the payment of crew for non-sailing vessels. Transport Scotland continues to work closely with CalMac Ferries, Caledonian Maritime Assets Ltd and Ferguson’s to align the recruitment of crew with vessel deployment plans. If the member wants more information on that, I will make sure that I or the appropriate minister write to him.

Deposit Return Scheme (Costs of Delay)

3. Meghan Gallacher (Central Scotland) (Con)

To ask the Scottish Government how much it has allocated from its budget to cover any additional costs resulting from the delay to the deposit return scheme. (S6O-02174)

The Minister for Local Government Empowerment and Planning (Joe FitzPatrick)

Scotland’s deposit return scheme is an industry-led scheme, in line with the principles of producer responsibility. The investments that have been made by businesses to date will be important for the success of the scheme when it launches on 1 March 2024. Accordingly, the Scottish Government has not allocated additional funding to cover industry costs due to a delay.

A wide range of businesses have welcomed the delay of Scotland’s DRS, and the Scottish Government, the Scottish Environmental Protection Agency and Circularity Scotland are working intensely so that we are ready for the launch in March next year. However, that will only be achievable if the United Kingdom Government urgently issues an exclusion for the scheme from the United Kingdom Internal Market Act 2020, giving businesses the certainty that they deserve and need.

Meghan Gallacher

That is a concerning answer from the minister. The Federation of Independent Retailers has called on the Scottish National Party to compensate retailers who have already signed contracts for reverse vending machines due to the recently announced delay. What is the Government doing to support those who have entered into expensive contracts for RVMs who now might not need to provide RVMs as a result of the changes to the detail of the scheme?

Joe FitzPatrick

Meghan Gallacher will be aware that the contracts to which she referred are a matter for the contract between Circularity Scotland and the producers. Members can be assured that only the largest producers are making those contributions. Retailers are now able to register, and smaller retailers in particular are able to apply for an exemption. However, many retailers are keen to be part of the scheme because it will attract footfall to their stores.

If Meghan Gallacher is concerned about further delay, I ask her to urge her colleagues at Westminster to ensure that the exclusion that we need to get the scheme up and running is in place as quickly as possible.

Maurice Golden (North East Scotland) (Con)

A multinational company with a dubious environmental record is the sole logistics partner for the deposit return scheme, which should cause concern about the potential to distort competition in the waste management sector. The final business regulatory impact assessment—released in late 2021—does not look at that, but we expect a new assessment to be released when the regulations are amended. Will the new assessment examine the logistics contract? If not, will the minister ask the Competition and Markets Authority to do so?

It would be best if the minister who is responsible for the scheme contacted Meghan Gallacher about that matter; I will ensure that she is aware of the member’s question.

Question 4 was not lodged.

Tax (Responsible and Ethical Collection Practices)

To ask the Scottish Government what steps it is taking to support responsible and ethical tax collection practices. (S6O-02176)

The Minister for Community Wealth and Public Finance (Tom Arthur)

The Scottish Government recognises the importance of ensuring that responsible and ethical tax collection practices are in place and the role of the tax collection agencies in that regard.

Robust governance arrangements are in place with HM Revenue and Customs and Revenue Scotland, which both have a statutory function to protect revenue against fraud and tax avoidance. Local authorities are responsible for the collection of council tax and non-domestic rates. The Scottish Government has empowered them to tackle avoidance loopholes and encourage them to share good practice on debt assistance and collection.

Richard Leonard

Paragraph 28 of the fair work agreement between Scottish ministers and civil service trade unions states:

“Scottish ministers are committed to publicly run, publicly delivered public services and are committed against the outsourcing of public services.”

The outsourcing of tax collection is a test of that commitment.

Last year, a new contract was signed by HMRC with private debt collection agencies. Will the Scottish Government, which has a service-level agreement with HMRC, rule out the deployment of private debt collection agencies for the collection of Scottish income tax? Will the minister write into the agreement that income tax compliance in Scotland will be undertaken only by workers in the public sector, and does he accept that this is a question of moral responsibility and ethical standards and not simply an operational matter?

Tom Arthur

I thank Mr Leonard for his supplementary question. He raises very significant points, and I know that he does so from a place of genuine moral and ethical concern. As he will appreciate, HMRC operates UK-wide, and, with regard to its debt collection practices in Scotland, it partakes in debt collection relating not only to the devolved aspects of Scottish income tax but to reserved taxes. One of those reserved taxes is national insurance, which could potentially be interlinked with debt pertaining to income tax.

Mr Leonard raised a lot of points. I will take them away and consider what further action can be taken, but I reiterate that HMRC operates UK-wide. Notwithstanding that, I will take the points away, and I will be happy to update him by correspondence in due course.

Budget (Third Sector Organisations)

To ask the Scottish Government what impact assessment it has undertaken regarding any reductions to core funding allocations in its budget for third sector organisations. (S6O-02177)

The Deputy First Minister and Cabinet Secretary for Finance (Shona Robison)

Scottish Government grant making is allocated across portfolios to various parts of the third sector to improve a wide range of outcomes. Some Scottish Government funding is issued through third sector intermediary organisations. Any assessments on funding levels will have been taken by individual policy areas.

Miles Briggs

I wrote to the former Cabinet Secretary for Finance and the Economy over a month ago with regard to the future of Bridgend Farmhouse in Edinburgh, which has received Scottish Government investing in communities funding for the past four years.

On 15 February, the organisation received notification that it would not continue to receive that funding. It is a fantastic organisation, a host of more than three social enterprises and a place where the community can come together. Does the cabinet secretary agree that Bridgend Farmhouse no longer being able to operate would have a significant impact in the south of the city, and will she agree to visit Bridgend Farmhouse and review the cut to core funding?

Shona Robison

First, I say to Miles Briggs that I will look out that correspondence—it is not something that I am familiar with, but I will have a look for it.

Clearly, these are difficult decisions. Grant funding to third sector organisations is always oversubscribed—it is the same for social enterprise funding. Therefore, that grant funding is prioritised in a way that aligns with the clear priorities that the Government has set out on reducing poverty, net zero ambitions and sustainable public services, so it is not possible to fund every organisation that applies for funding.

However, as I said at the beginning of my response, I am happy to have a look at the correspondence about Bridgend Farmhouse, and I will write back to Miles Briggs once I have managed to do so.

Question 7 was not lodged and question 8 has been withdrawn, so that concludes portfolio questions on finance and parliamentary business. There will be a brief pause before we move to the next item of business.