09:15
Agenda item 2 is an evidence session with the Cabinet Secretary for Climate Action and Rural Affairs. Today’s session follows our stakeholder evidence sessions on 24 September and 1 October, and it completes the evidence-gathering part of our pre-budget scrutiny, which has been focused on the joint budget review.
I welcome the Cabinet Secretary for Climate Action and Rural Affairs, Gillian Martin, who is supported by Phil Raines, deputy director, domestic climate change; Helen Carter, portfolio finance lead; and Sean Neill, director, energy and climate change.
Before we proceed to questions, I invite the cabinet secretary to make an opening statement.
Thank you, and good morning, everyone. I thank the committee for giving me the opportunity to discuss the Government’s spending plans for climate action ahead of the publication of the budget.
The programme for government sets out our ambitions for Scotland and demonstrates a continuing commitment to ensuring that climate and nature remain core priorities across the Government. A clear direction has already been established for how we intend to reach net zero and make Scotland more climate resilient through the climate change plan—“Scotland’s Climate Change Plan: 2026-2040”—the publication of which was one of my final acts in the previous session of Parliament, and the “Scottish National Adaptation Plan 2024-2029”.
We now have a firm focus on delivering across every sector of the economy and society, which will require cross-Government action that goes beyond the spending in my portfolio. For example, action to increase our investment in electric vehicle infrastructure will be driven through Mr Flynn’s transport portfolio, while our support for heat pump conversion will be overseen by Mr Gethins, as the minister who is responsible for the energy portfolio.
We will continue to ensure that the Government’s decisions support net zero through environmental impact assessments. Strengthened budget scrutiny, including through our climate change taxonomy and net zero assessments, will continue to improve transparency on public spending and its climate impact. I am pleased to say that the 2026-27 budget taxonomy demonstrated our commitment to the provision of more than £5 billion for climate-positive action across the Government.
Sustained action delivers results. As our latest emissions statistics show, Scotland has reduced greenhouse gas emissions by more than half since 1990. Although the challenge of achieving net zero by 2045 is significant, it offers a great number of opportunities. Climate action is not only about reducing emissions, important as that clearly is; it is also about supporting long-term prosperity, strengthening energy security, improving public health and creating resilient communities. The transition to net zero offers long-term benefits, including lower energy costs, economic growth and new employment opportunities. Rewards have already flowed from our world-leading energy transition, including the creation of more than 35,000 jobs in Scotland’s low-carbon and renewable energy sector.
The United Kingdom Government needs to take more action in this space, particularly in reducing the cost of electricity, as that will be one of the key drivers for decarbonisation of our systems, our households and our businesses, not only in Scotland but in the whole of the UK.
We must also ensure that we adapt to the impacts of climate change that we are seeing. Adaptation is about protecting people, public services and the economy. As our third national adaptation plan sets out, adaptation is embedded across the Government through investment in resilient infrastructure, flood protection, coastal resilience, nature systems and public services.
Flooding alone is estimated to cost Scotland around £500 million each year. Investing in resilience at an early stage represents far better value for money than repeatedly paying for recovery and repair. Of course, often, we cannot quantify some of the other impacts, especially the trauma that flooding causes for householders and communities. Every £1 that is invested can generate between £2 and £10 in benefits and avoided costs, while flood resilience measures can save many times the up-front cost in avoided damage. That is why we will deliver an extra £15 million for flood resilience and £14 million for coastal adaptation over the course of the parliamentary session.
Given that our climate, biodiversity and nature are all intrinsically linked, protecting and restoring nature is also essential. Our strategic framework for biodiversity sets out our ambitions for nature recovery, and we will continue to develop statutory biodiversity targets under the Natural Environment (Scotland) Act 2026.
By prioritising climate and nature together, we can support economic growth, enhance energy security, create new jobs and build a more resilient Scotland for future generations. That is action that we will need to take for many years to come.
I look forward to answering questions.
Thank you. It is fair to say that the climate portfolio is vast and complicated and that some of the policy areas that it covers are difficult to fully understand, particularly in the context of the joint budget review, which I think is fairly new to most people.
There are three strands to the joint budget review: the climate narrative, the climate taxonomy and the net zero assessments. Some of the themes that we will cover in questioning will centre on those strands, although questions will also have arisen on the back of what you said in your opening statement.
Do you think that the climate narrative provides an accessible introduction to the climate consideration in the budget for stakeholders and, more crucially, for the wider public?
That is the aim. We are at the start of the process, and it is not an exact science. We wanted to start by setting out the climate narrative. The committee has taken evidence from a number of people who have views on the narrative and suggestions for improvements, and we welcome those. We are doing this exercise for a reason, and there is always more work to do in this space. We are one of the few Governments doing such work. There are some other countries that produce climate narratives along with their budget, but they are few and far between. I think that France and Austria do, as well as us.
We have an opportunity to lead the way, but there is also the scope for us to continually improve. We are considering how we can use the climate change narrative of the Scottish budget to identify examples of funding that has been committed to key climate change and SNAP policies. We are reviewing the taxonomy system so that it can be applied and can provide more useful analysis as we go. I outlined some of that in my response to the letter that the committee wrote to me.
It is right that we review the taxonomy system. I might need to check my recollection—I am looking at Phil Raines here—but I think that, when we started in 2018, we included only capital spending, and then we decided to include resource spending as well. We are constantly widening it out.
I think that the taxonomy is helpful. First of all, it is helpful to ministers as they make decisions about spend. That is one of the main reasons for it. We need to ensure that the money that we put into certain policies works hard for us. We have stretching ambitions—we have the first carbon budget to meet, as well as the 2045 net zero target—so it is only right that we have the tools that are necessary for us to analyse where we are putting our money.
There are a number of other things that we need to get better and better at, and one is about looking at the cost benefits of policies. There are a number of areas, which people will have heard me talk about many times, where the policy and spend might be located in the climate action portfolio but the benefits appear in relation to people’s health outcomes. With a policy related to air pollution, for example, the benefits might not arise immediately but over the longer term, and we might be able to trace them back to decisions that were made in the climate action space. We are in the foothills of that kind of analysis, and the Edinburgh Climate Change Institute gave us a great deal of help on that when we were putting the climate change plan together.
The taxonomy is one thing—it is really helpful for us when we are analysing climate spend across all areas, or particular areas, of Government spend—but we have to take other mechanisms and considerations into account, and we are in the early stages of that process. It is such a useful discussion to have, and I commend the committee for the work that it has done on getting feedback, because whether the climate narrative has been useful and how it can improve are matters that we are absolutely alive to.
The committee heard from the Scottish Fiscal Commission, which recommended that the climate change assessment of the budget should allow the identification of spending on policies and programmes in the climate change plan and in the “Scottish National Adaptation Plan 2024-2029”, so are you also considering that?
Yes. The process of putting the climate change plan together means that, in effect, the policies in the plan have been through that process, because, as part of Cabinet discussions, we need to have a big discussion about what we are putting forward and what that would mean for the public purse.
It is important to say that the public purse will not be able to meet the cost of everything, and I do not think that we would expect it to. In my opening remarks, I mentioned that economic opportunity will arise from the direction of travel associated with getting to net zero. Policy certainty around net zero brings a lot of opportunities for investment, whether it be inward investment into Scotland or business growth within Scotland.
I am constantly wary of the fact that when we talk about the costs associated with anything in the climate change plan—this has happened—we then hear narratives from political actors who do not believe in climate change or in taking action associated with tackling climate change. They put out misinformation about what it will cost the Scottish people to deliver on the policies, and they do that in order to shake the foundations of what we are trying to do and to get people very worried about what it is going to cost us as taxpayers.
In fact, the Government will be allocating spend for climate change policies as we go, but it can and does crowd in additional money from the private sector and additional action from outwith Government funding. It will also consider the longer-term cost benefit of policies. Preventative spend could result in better economic outcomes and reduced child poverty—for example, we could talk about any policy associated with bringing down the cost of heat in homes; improved air quality affects long-term illness associated with respiratory complaints; and nicer places to live can mean improved mental health. Therefore, we take a holistic approach.
09:30
You mentioned the Scottish national adaptation plan, which also provides opportunities for preventative spend. In my opening statement, I outlined some of what that means in numbers—in pounds and pence. With regard to spend on adaptation, I also alluded to the fact that we cannot quantify things that we are preventing, such as trauma. Ask anybody who has ever been taken out of their home in the middle of the night because their house has flooded, and they will say that it is not just about the material damage but the psychological damage. Phil Raines and I were talking about that aspect, and we have commissioned further research on the cost benefits of climate spend.
The net zero assessments and the taxonomy are great tools, as, I hope, is the climate narrative. I hope that they are all good tools for budget discussions and for the committee’s budget scrutiny, but they are just part of the picture, because we can do more. The short answer—which I realise that I am not giving—is yes, we are considering both of those things.
Thank you. We will come to questions about the taxonomy, but, with regard to the climate narrative, given what you have said this morning and the fact that your policy area is so vast, is there not a need to simplify things to get more buy-in from the wider public? Some of the language might seem too convoluted. In the world that we live in, there is a wall of noise—of information, misinformation and disinformation—but simplifying some of the messages might help to get the positive narrative across, as opposed to the opposite.
I completely agree. Behind the scenes, very complex work is being done, and my officials are steeped in that work. It is our job—my job, our job and the job of anyone who cares about all this—to communicate the benefits of what we are doing in a way that chimes with what people care about.
I am constantly thinking about my own rhetoric in that regard. I have had the climate action brief for a number of years, and my officials are probably sick of me saying that we must always be able to demonstrate what something means to the ordinary person in terms of the cost of living and of their life becoming better. If we cannot do that, what are we doing? We know why we are doing all these things, and everything we are doing is very complex, but you are absolutely right, convener, so if the climate narrative associated with what we have talked about is a bit convoluted—I think that was the word that you used—we will take that away. I am absolutely open to suggestions on how we can address that.
In the past couple of years, but particularly in the past year, we have seen disinformation around climate action and net zero becoming pretty toxic and weaponised. It is not enough to think, “I know that we’re doing the right thing”, because that will not matter if people do not believe us. It is incumbent on us all to address that, and I absolutely take your point, convener.
Cabinet secretary, I want to explore the taxonomy, which you touched on in your opening statement. It was great to hear that Scotland is leading the way on the new approach to carbon budgets and how those are connected to fiscal budgets. You have been busy in this area for much longer than I have, and I am trying to get my head around the three strands. My understanding is that the taxonomy is a crude, quite broad-brush sorting and labelling system that works with the climate narrative and net zero assessment strands.
Our predecessor committee was concerned that the climate taxonomy does not provide enough detail to show how spending decisions contribute to our net zero ambitions. For example, a large budget line might be classified as positive for climate change, but the taxonomy will not tell us which activities within that budget line are reducing emissions and by how much. The committee felt that more needed to be done to join the dots between climate objectives and actual spending decisions.
You said earlier that you would be open to working on that, but I would be interested to understand how you intend to address those concerns and improve the taxonomy so that the Parliament can better understand the climate impact of spending decisions.
I will bring in Phil Raines in a second, because he has been doing a great deal of work on the mechanisms that are associated with the taxonomy. It would be best to go to Phil, because I might not work on it at the same day-to-day level—in fact, there is no “might” about it; I do not.
I also have some follow-up questions.
I recognise that the committee wanted more detail on the taxonomy as a result of its discussions and the questions that were asked. After the climate change plan was published, we all went off to fight elections, but Phil’s team hit the ground running, so I will hand over to him.
When considering the focus of the taxonomy, we need to recognise that the budget document that gets presented looks at level 4 budgets. That is the level at which the taxonomy applies. There will always be arguments—this applies not only to climate change but right across the Government’s spending intentions—for looking below that level. Clearly, a decision—a compromise, if you will—has been taken to balance proportionality and the way in which the information has been presented. In that sense, the taxonomy follows the practice that has already been set out of looking at level 4 budgets. It tries to provide the analysis, while the assessment considers what goes into the budgets in more detail.
The taxonomy is presented in such a way—we use the expression “tagging” rather than “labelling”—that it works at that level. That is why it must sit against the other things that are put in place. The policies—that is, the smaller building blocks that might lie within the budget—have been clearly set out and presented in the costing of all the key elements that sit within the climate change plan, particularly for the next couple of years. As new or heavily revised policies come on stream, we are trying to get the net zero assessment to a point at which we can have a more forensic view of what the impacts of those things will be.
It can be argued that considering the taxonomy in isolation will not give the full picture on how we are trying to gather information on the way in which the spend operates. Where we take those different tools—I know that the committee will come on to questions about each aspect of them—remains an area of ongoing improvement, the need for which we have certainly accepted internally. However, the taxonomy very much sits within the framework of how the budget is already set out.
Okay—
Maybe I could—sorry.
I have a few questions to get through and a certain amount of time in which to do it, so I will proceed.
In your opening statement, you highlighted that spending of more than £5 billion in the 2026-27 budget has been classified as being positive for climate change. How meaningful is that figure? For example—I asked about this a couple of meetings ago—we have the £836 million affordable housing supply programme, which is, as a whole, classified as positive, even though we do not really know from the taxonomy how much of that spending is actually reducing emissions.
From what Phil Raines has said, my understanding is that there is a taxonomy and that that is how we have to do it. Is it accurate to present the whole £5 billion as climate-positive spend when we cannot necessarily identify actual climate benefits? Some house building could be positive and some could be problematic.
I have a breakdown in front of me of the climate-positive spend in each portfolio, which I would be happy to share with the committee. On transport, the figure is £2.8 billion. For housing, it is just over £1 billion. That relates to the parts of that portfolio that involve work that is actively climate positive. I also have a breakdown of the numbers associated with my portfolio. Transport is the biggest area of spend; it is where the biggest opportunities are for decarbonisation. There is also budget associated with health and social care. I am happy to send that information on to the committee rather than reading out a lot of numbers. Phil Raines has more detail on that.
I want to follow up on my question, and then you can wrap up your answer. The underlying question for the committee is whether the taxonomy could be somewhat misleading. If we are classifying entire spending lines as positive, neutral or negative, could we be at risk of obscuring what is actually happening in those budgets? How can we make sure that the taxonomy gives the Parliament and the public—the convener brought in the issue of how we communicate what is going on to the public—an accurate picture rather than potentially misleading classifications?
I hope that it is not misleading. If it is misleading the public, it is misleading me and the Government. It must be as accurate as possible. I said at the start that it is not an exact science. There is no perfect blueprint out there that we can take off the shelf and apply. Only a handful of Governments are doing such work. I rattled off a couple of examples, but I do not know what detail those Governments go into compared with us. It is not an exact science. We need to constantly ask ourselves the question that you asked.
I do not think that the public would be interested in the nuts and bolts of the taxonomy process that goes on behind the scenes in the Scottish Government, but the narrative is important. When I mention figures such as £5 billion or X amount associated with transport, it is important to be able to point to tangible policies that that is mapped to.
As ever, Phil Raines will be able to provide more detail.
Your question goes to the heart of what might be an issue of proportionality. To take your example of affordable housing, building those houses will create emissions, through the involvement of tractors and what have you, but emissions-saving work such as the installation of energy efficiency measures has a positive impact.
When the assessment is made about the programme as a whole, one could argue that it would not be proportional to go into which proportion is leading to the creation of emissions and which proportion is not. There is an argument that that would be a massive exercise that might gunge up the budget process as a whole, certainly from the point of view of presenting it in a way that I think you might be leading towards with your question.
The assessment is a net assessment; it is not an absolute assessment. It can never say that all of the budget is leading to, in that example, emissions reduction, but it can say that, on balance, looking at the different impacts and making an analytical judgment, the impact is positive. There are obviously questions that could be asked about how those assessments and judgments are reached, and what the considerations are, but quantifying that within each of those budgets would be a significant exercise for the taxonomy.
In relation to what we were saying earlier, the net zero assessment is meant to be one of the places where we start to do that work more systematically during the development of new policies. You have asked a reasonable question, but the taxonomy is not necessarily the place to do that work. We have to think about how all the tools that we are using are doing that in the round and how people—not least, members of the committee—can be apprised of that.
09:45
My impression is that the taxonomy is a broad-brush sorting process and that we get more detailed information from the other strands.
The process is certainly broad brush, but it remains rigorous. I do not want to give the impression that there is anything informal about the analysis that is done, but the reporting is presented at a more general level. In that sense, the process could be described as broad brush.
It gives ministers and the Cabinet the tools to make decisions. As I said, we are reviewing the process, because we constantly want to improve it.
What you have said might help the committee in its consideration of the impacts of public sector reform. Do you have a sense of whether we can improve the granularity that we are talking about with the current resources that are available for compiling the taxonomy?
As Phil Raines alluded to, it is about priorities and choices. The Government has to consider its capacity to do things. Having a good taxonomy system is a good thing, but going into that level of detail is obviously quite resource intensive, so it is a question of choices and priorities.
In its budget scrutiny, the committee is placing a great deal of importance on the taxonomy. I think that that is right, and it is helpful, but that is not the only consideration when it comes to the budget. That is certainly not the only task that I ask my officials to do—I ask a lot of them. I am very much geared towards delivering our climate change policies and ensuring that my colleagues across the Government are delivering on their responsibilities associated with the climate change plan in order to, in the near term, meet our first carbon budget.
Yesterday, when I was in front of the Rural Affairs Committee, I made the general point that I am focused on delivery, not on creating bureaucracy or more reports, reviews, analysis or whatever for their own sake. That said, the review of the taxonomy will ensure that we get the right information, which will help with delivery, if you see what I mean.
We need to strike a balance, but I take your point. That is a consideration of mine. What does the committee want in terms of detail? You will have to strike a balance, too, in relation to what detail you need, because, if you ask the Government to give the Parliament details, that might take away resources from other things that will result in action.
I will leave it there. That has been helpful.
Cabinet secretary, you touched on your work with other portfolios and other cabinet secretaries. Is the delivery group that has been created where you will ensure that they are doing what has been agreed?
We had our first meeting yesterday. As well as setting out our terms of reference, we got into discussions about delivering everyone’s priorities and responsibilities in the climate change plan. That group will be one of the mechanisms, but I will also have regular bilateral meetings with my colleagues. In a 90-minute or two-hour meeting of the delivery group, we will not be able to cover everything, but that group brings everyone together. There will be certain points at which the delivery group will look at particular aspects. I have all my officials, including my director general, who is overseeing the whole process.
The delivery group will be critical, and I am feeling very positive about it after yesterday's first meeting, because everyone was in a very can-do space.
Over the past couple of weeks, we have taken evidence on the three strands of the joint budget review. I will focus on the net zero assessment strand. Last week, we heard from Lewis Barlow at WSP, who assessed the net zero assessment pilot. There has not been a formal response to the pilot. Is the Government intending to give a formal response to explain which recommendations it will take forward? Also, we heard from another witness that there was a lack of clarity on where we are in the process of rolling out net zero assessments.
I will briefly take you through what has happened following the pilot. There was a pilot in 2024, there was an independent peer review, and then net zero assessment was rolled out across the whole of Government, including agencies such as Transport Scotland and Scottish Forestry. That happened in April.
The emissions from those policies and actions will contribute to our pathway. The details of the emissions impact of the Scottish budget will then be included in the high-level carbon budget assessment. A central team has been established to co-ordinate the net zero assessments across Government.
I will hand over to Phil Raines, because he is pivotal to this work. What assessment of the pilot are you looking for that you think is not there? We had the pilot, learned the lessons and rolled net zero assessment out. I would be interested to know what more information you might need.
I will come to more specific questions on recommendations, thresholds, cumulative approaches and those kinds of things. A number of recommendations were made following an assessment of the pilot. Have they all been taken forward?
You mentioned that net zero assessments have been rolled out, but there is also the question of the recommendations, the stage that they have reached in being taken forward, which ones have been accepted and which ones require further consideration.
I will bring in Phil Raines at this point.
The simplest thing to do is to offer to write back to the committee with the detail of what we are doing against each recommendation, rather than necessarily rattling through them all at this stage.
In a sense, we are not sure what would constitute a formal response in that space, because we commissioned the report, it was produced, we considered what changes should be made, those changes were agreed with ministers and we are now proceeding with them. If memory serves, some of that information may already have been communicated to your predecessor committee, the Net Zero, Energy and Transport Committee.
I will give one example of how we have progressed from the pilot. The pilot had a screening threshold of 100,000 tonnes for the carbon emissions of policies, positive or negative. One of the conclusions arising from the pilot was that that was not the right threshold, so we have now set it at 10,000 tonnes, which is significantly lower.
Rather than taking a piecemeal approach, it is probably appropriate for us to write to you with the recommendations and the stage that each has reached, so that the committee is formally apprised of that.
I will talk about the timescales going forward, which may pick up some of your next questions. We kicked off in April, so we are still very much in the early stages. As you would imagine, there has been extensive training and awareness raising, and a series of tools and requirements has been put in place internally. As you would expect, we are carrying out an internal review to see how it is going. That will start in the next month or two.
The committee should be aware—I think that we have informed the committee about this before—that we will be reporting on the first year come spring. I cannot remember whether that will happen in March or April, but I will call it spring. That is not a civil service spring, but a proper spring.
Thank you. That was helpful, and I look forward to receiving the correspondence.
Over the past few weeks, the committee has also looked at the net zero assessments and considered whether there could be more transparency and whether there will be an opportunity to influence what happens in the assessments. From the outside, it looks as though the net zero assessment will be carried out, at which point the Government will decide on any changes and what will go forward, and, once it goes through the taxonomy process, we will get more information that evaluates whether it has been positive or negative. I think that the Government has previously said to the committee that assessments would not be shared directly in the budget documents and that information would come into the public domain once it goes back to the taxonomy process. Over recent weeks, there has been discussion about whether there should be more opportunities in the net zero assessment phase for transparency on how decisions are made about what to take forward or what compromises are decided on at that stage.
Do you mean before a decision has been made by a minister?
I think that the committee would be interested to find out whether there are opportunities for more transparency in relation to how the Government makes decisions. Collectively, around the Parliament and certainly on this committee, we want progress to be made in this area, so are there opportunities for the committee to have a better understanding of where compromises will be made? There will have to be compromises on policy decisions. It might be that you will explain that such opportunities are not possible, but there is an appetite to think about whether the committee or MSPs could be more involved in decisions that are made through the net zero assessment process, so that there would be more transparency. Therefore, one consideration is whether there are opportunities to influence the process. It might also be possible to get a better understanding of why a decision was made, so it might be that greater transparency around how and why decisions are made comes post-decision.
Providing information post-decision seems more sensible. It is absolutely right to be transparent about how and why we have made decisions. Obviously, we are looking at the report that you will get in March, and we can take away your point about that. However, pre-decision, we do not have time to waste. We all have to make decisions relatively quickly, and, with the greatest respect, we could not take the approach that you have asked about with every decision. We do a lot of consultations on our policies. Forgive me, but I think that scrutiny involves you being able to ask questions about why I made a decision and what I took into account with regard to the net zero assessment. We will take away the question of whether there is more information that we can give you.
However, it would be difficult to do that before I made the decision, and it might slow down Government somewhat, if you see what I mean. It would be difficult for me to manage that, because the assessments are done to give us the right kind of information before we make a decision. If we reached a situation in which Parliament had to agree on the decision or tried to prompt what the decision should be outwith the normal way in which it does that, it would—to go back to what Ariane Burgess alluded to in relation to public sector reform—slow the process down to the point where I would be running to stand still, and we have a carbon budget to meet in five years’ time.
It would be helpful if the Government could take that point away and consider whether more transparency can be built into that bit of the process, which might be post-decision. That would help to build confidence or knowledge among MSPs, because compromises will have to be made as we head towards net zero.
I am happy to give you the information that you need in order to scrutinise my decisions.
Thank you. I have a question about the pilot, which is connected to how the net zero assessments are being rolled out. The balance of the policies that were chosen to be included in the pilot appeared to be weighted towards those that would come out as more positive, rather than those that might be more challenging. I do not know whether that was why that decision was made. Was that a deliberate decision?
I will bring Phil Raines in, but my instinctive response is that we learn more from analysing policies for which we have some results. However, the net zero assessment is now being rolled out to apply to all policies, so we are not picking and choosing the policies that make us look good.
Phil was instrumental in putting the pilot in place.
The assessment applies to new and revised policies. When we did the pilot, we picked policies in development rather than existing policies, so we had a sample that was limited by what was under development. The intention was to pick the full range of those that would be positive, those that would be potentially negative, those that would be mixed and so on.
A judgment could be made on what that sample should look like, but we tried to maximise the range within the sample that we had available in order to fulfil the intentions of the assessment, which is there for new and emerging policies, or policies that have been significantly revised, rather than retrospective policies.
10:00
Going forward, will the assessment include all policies? Will it also include resource and capital-intensive policies?
Yes, it will include all policies.
My final question is on thresholds, which we talked about earlier. There has been some support in the discussions that we have had in recent weeks for adopting a cumulative approach. There might be projects that fall below the threshold and would not qualify—road building is the example that is often used—but if five or 10 projects were to be collected together, they would breach the threshold, and there might be a better understanding of—
To clarify, do you mean five or 10 individual road-building projects, which would involve looking at road building as a whole, or do you mean taking a cumulative approach over time?
No, I mean a collection of projects that would come under the threshold and would therefore not qualify. We have heard that there is some support for a cumulative approach that would group similar projects together and recognise that, collectively, they would go above the threshold and merit an assessment.
I do not know how that would work. Thinking about it instinctively, projects will happen at different times, so how could they be grouped together?
Perhaps it could be done within an established timescale. That might be something—
We will take that proposal away to get a better understanding of what people have said to the committee about it. The answer is that we do not know whether that is possible.
There would be some natural complications with that proposal. What level of aggregation would it go to? Would it cover all road building or just particular types? We would need to decide what could be bundled together and whether that would be a sensible way to affect ministerial decisions. Ministerial decisions for different projects—which the assessment is ultimately meant to be targeted at—are completely separate and are taken over different timescales, so such an approach would not serve the purpose of the assessment. You make a relevant point about the need to ensure that the totality of the impacts is seen somewhere in the decision-making process, but the proposal involves some complexities that we would need to reflect on.
Okay—thank you.
An example was given there of cumulative projects that could lead to the threshold being crossed. Another example that was given in a previous evidence session is the infrastructure delivery pipeline, which includes lots of smaller projects. The project that interests me most is Lochgelly health centre, which would almost certainly not cross the threshold by itself but possibly would when combined with all the other things that are linked to it in the infrastructure delivery pipeline. Has a net zero assessment been undertaken for the infrastructure delivery pipeline as a whole?
We have not focused on plans or strategies, but we could certainly consider that area as we go forward. We would want to be cautious about that to some extent. There would be the assessment of the plan itself, which one could see an argument for, but we would need to be cautious about there being—to use the expression—apples and oranges.
There are many different types of infrastructure that do many different types of things. The deputy convener gave affordable housing as one example, and you are—quite rightly—talking about health centres. If those things were to be mixed together, the assessment would not have value, specificity or granularity, which are important. We would need to consider what it is that we need from the assessment that will affect the ministerial decision. That is not to say that such an assessment cannot be done, but it would be something to think through.
I return to the point that I made in response to Ariane Burgess’s question: we must balance the resource that we have available to us with the outcome that we want. It is an interesting discussion to have, but I can immediately see issues with regard to complexity and the resources that would be taken from the teams that I am already asking a lot from in order to deliver on the policies that will get us to net zero.
I suppose that it is about trying to work out where decisions will be influenced. More broadly, when it comes to housing and health centres, a lot of concrete is involved in their construction. At what point is something triggered that asks, “How do we deliver this in a more carbon-efficient way?” Maybe that should happen in the planning system—I think that Martyn Day will have questions on that later. Should that be a process that the Government reviews or should it happen at the planning stage with local authorities and developers? I do not know—that is an open question.
That is a good point.
Before I bring in Sanne Dijkstra-Downie, I will follow on from David Barratt’s question and the example that he gave. In that same document, three locations were suggested for health centre replacements—there is the project that David referenced and another one is in Port Glasgow. I am thinking back to when projects were undertaken to replace the health centres in Greenock and Clydebank through various Scottish Government funding streams. If those were to have been, in effect, one project with two different facilities in two different locations—if they were to have been bundled together—would that have been of assistance when it came to considering the net zero assessment and the taxonomy?
I am not sure. I want to bring us back to another point that has been made about the climate narrative that is associated with carbon reduction. It is important that we have things in place to inform our decisions. The planning system is another area in which people make decisions on what gets built, what materials are used and whatever else. When the public want a new health centre to be built, anything that we put in place cannot slow down that process, which takes a long time as it is. It absolutely exercises the public when they do not have the right facilities. We will not bring many people with us if such facilities get delayed because we had to do an additional review at the Government level.
I am just bluntly putting that point out there, because delivery of the things that people need must be borne in mind in all of this, and that includes the resources that such delivery requires. During the passage of the Natural Environment (Scotland) Bill, I resisted many amendments that were associated with reviews and reports for that reason; it takes away from action. That must always be in the back of our minds, particularly in the context of PSR and delivery, where people see that the things that they need are taking too long.
Thank you.
I will quickly follow up on the previous line of questioning about cumulative impact. I am conscious that some of my colleagues asked about particular projects, but the assessments apply to policies. Do you have any concerns that the way in which policies are structured and broken up into smaller pieces could mean that we end up missing areas of policy? They might not individually meet the threshold, but they could do so as a body of work. How do we ensure that we do not miss those policies?
I do not think that I can give a definitive answer to that question. We have just talked about the cumulative aspect. We put the net zero assessment in place following the pilot, and stage 1 determines whether a policy exceeds the threshold, which we brought down because we thought that it was too high. Could we bring down the threshold any further? That is another question that we will constantly be asking ourselves. Then there is the screening that is associated with all policies.
It is a legitimate question, but I come back to the point about balancing outcomes with the resource that is associated with doing things in the way that you suggest.
As you said, a net zero assessment must at least be considered for all early-stage policy proposals, but I appreciate that they do not all undergo full stage 2 assessments. In previous evidence sessions, we have talked about the resources that are required for that, and we have put this question to other people who have given evidence: how burdensome will it be to apply net zero assessments to all policies?
We think that it will be manageable and that it is important. Policies will not rush at us in a massive glut all at once. The Government is preparing to carry out the assessments as policies are brought forward. We have been carrying out the assessments for only a few months, and we will always keep a watching brief on how things are going. As I said, we will carry out an assessment after the first year, and we will give the committee information on how that assessment has gone.
The Government constantly considers the resources that are applied to things, whether the outcomes associated with those things are worth while and whether we should make any tweaks to processes.
Give us a year and I will be able to say how burdensome the work has been. It might not be that burdensome—when we look back on it, we might think that the net zero assessments have been a game changer in giving ministers an appreciation of how policies will affect our drive to net zero. It is possible that things will surprise us in the assessments. We might get a little more bang for our buck from certain policies, with the assessments suggesting that they might be a lot better than we had predicted, so we might decide to put more money into policies that will help us to achieve other outcomes as well as the initial outcome that we wanted to achieve. The analysis after the first year of the roll-out will be really important in helping us to make decisions about where we go next with our work and whether we should tweak things.
I will add two observations. First, the level of activity and burden will clearly differ depending on the policy. Secondly, we should bear in mind that strategic environmental assessments are already required for every policy. One way to think about the net zero assessment is that it piggybacks on the work that we would expect to already be happening in looking at policies through an environmental and climate lens, but the assessment will require a degree of quantification. The assessment builds on work that already has to take place, so it might complement the SEA process and make it easier in some respects.
That is really helpful. In previous evidence sessions, we have heard how important it is that the net zero assessment is seen as an upstream tool when policy is developed and that it is not done after the fact. You have had the results from the pilot, but you have not done the assessment after the full year, so it might be too soon to say, but can you give specific examples of policies—perhaps those in the programme for government or others that you have been working on—that have been influenced, in their design, by the net zero assessment?
I am glad that you have asked that question, because I can give a couple of examples. The vehicle scrappage scheme and the public sector decarbonisation action plan were considered through the lens of the net zero assessment.
The public sector decarbonisation action plan went through a full net zero assessment, which considered the scale of emissions reductions that could be achieved through co-ordinated action. The assessment threw up quite a lot of information that will be helpful in effectively deploying that plan. The net zero assessment of the vehicle scrappage scheme was helpful in showing the policy’s significant positive contribution to our carbon budget in the next five years and to our subsequent carbon budgets.
The net zero assessments augment our work. We have set out our programme for government, and the climate change plan includes all the high-level plans over the next 15 years. The net zero assessments will take a granular look at some policies in that plan and at other policies that are being developed. The assessments will allow us to say, “Hang on a second—this might give us a bit more space to decarbonise in a way that was underestimated in the climate change plan.”
10:15
I like to think of the climate change plan as a living document—I know that it lives in Phil Raines’s head as a living organism. We must update the plan every five years, but it does not just sit on a shelf for five years before we need to update it. We constantly assess the policies in the plan that we think will get us to the first carbon budget or to net zero.
It would be lovely to think that we have underestimated the impact of some policies and that they will perform a lot better. For example, we did not expect that we would exceed our peatland restoration target last year. Other policies might not come off in the way that we thought, because they might have been affected by other factors. For example, the UK Government’s decision on the vehicle emissions trading schemes might have an impact on our policies on electric vehicles. We constantly consider not just our policies but policies elsewhere that affect our delivery.
I hope that the net zero assessments will be really helpful in allowing us to take an agile approach to delivering the climate change plan.
The question was about examples of policy design having changed. As has been said, it is early days. Perhaps we could reflect on what reporting to the committee would enable it to understand how the process had worked over the previous year. In the future, we might look to provide a report on what has happened in the recent past.
The analysis on the roll-out of the £2 bus fare cap will be really interesting, because that policy will have many outcomes associated with it. It is mainly a cost of living policy, but, as it is rolled out throughout the country, it will be really interesting to assess its impact on modal shift—people leaving their cars at home and taking the bus instead—and on emissions. The pilot has taken place, and the policy has now been rolled out in the Strathclyde transport area. It will take time to carry out an analysis of the outcomes, but those outcomes will be able to be assessed over time. From the point of view of net zero assessments, that analysis will be really interesting, and I hope that it will put a smile on my face when it comes to meeting our carbon budgets.
I hope that it will put a smile on all our faces.
It certainly put a smile on my face on Tuesday when I took the bus to get from home to Greenock in only 25 minutes.
My question, which follows on nicely from Sanne Dijkstra-Downie’s questions, relates to the relationship between the net zero assessments and the climate change plan. How can we avoid duplication? To what extent will the net zero assessments over the next few years replicate the work that has already been done on the climate change plan?
I come back to what I said to Sanne Dijkstra-Downie. In the climate change plan, we have to put in place projections, plans and route maps in relation to the emissions reductions that, at that point in time, we hope to achieve and are planning for. We have to be agile, and the net zero assessments will augment and allow us to test that work, because they will provide information associated with future policies—obviously, the programme for government each year will include new policies.
The net zero assessments will be a really useful tool. I do not think that they will duplicate work. Instead, they will provide granular refinement, if I can put it that way.
That helps to reassure me.
At last week’s meeting, one of the witnesses—I cannot remember which one—made the interesting suggestion that there should be something similar to net zero assessments in the planning process. Could that be introduced?
The committee will have to invite in another minister to get an answer to that. The planning process already includes environmental impact assessments—Hannah Mary Goodlad has talked about the need for them in relation to data centres. The planning process already requires EIAs to be done for many proposals, and such assessments include information on the emissions that would be associated with particular planning decisions.
I am not being slopey shouldered, but that is an issue for the planning minister to think about. As we have seen in recent weeks, we are always having to look at the planning landscape to check whether it is fit for purpose as things develop. I guess that you are asking whether the assessment that is done in the planning process is match fit. I will pass on your comments to the planning minister.
Thank you. You mentioned AI data centres. It might be useful to consider whether net zero assessments could be carried out in relation to proposals for AI data centres.
It has been confirmed in the past few weeks that environmental impact assessments will have to be carried out for data centre proposals, so, in effect, that has already been implemented.
You will be aware that, yesterday, the committee published our call for views in relation to our inquiry into data centres. We are all looking forward to getting stuck into that work when we come back after the recess.
I think that it was the witness from WSP who touched on that issue at last week’s meeting. They also indicated that NPF4 makes it clear that a whole-life carbon assessment should be done for all development but that that requirement is not necessarily being consistently applied.
The Sustainable Scotland Network is doing a survey of all local authorities at the moment, and it will send us the results, which we will look at at some point. The planning system definitely has a role to play in making sure that such assessments are indeed carried out as part of the planning decision-making process. Although we might assume that that will happen because it is policy, it does not necessarily actually happen.
I am interested in the link between assessments and budget decision making. We have heard a lot of evidence about the potential value of net zero assessments in the early stages of policy discussion, rather than at the point of decision when the direction has, in essence, already been set. How will you ensure that net zero assessments are a meaningful tool and do not become just a tick-box exercise?
I hope that the net zero assessment process is not a tick-box exercise, because it performs a really important function, especially at a time when we need to be very careful about how we deploy our budget. That is the main reason for doing such assessments. If the process was a tick-box exercise, it would be a waste of our time.
First of all, net zero assessments are a tool for ministers to use in deciding to opt for one policy over another. If a policy proposal is put in front of me and I receive a net zero assessment that does not bear out my initial thoughts on the value of the policy from a carbon reduction perspective, that will allow me to go back to the drawing board. The net zero assessment process will inform the policies in programmes for government. I will want the net zero assessment that is done on a policy proposal to bear out what I hoped that the policy would do. If it does not, I will look elsewhere.
You make a really good point, which relates to the point that I made about bureaucracy. We do not want to put in place processes that are just tick-box exercises, because that will take resource away from our work on delivery. A net zero assessment will be carried out before a decision has been made, to inform and improve the judgment of the person who makes the decision on whether to develop and roll out the policy. If a net zero assessment shows that a policy would not be at all useful, more work will have to be done on that policy before it can be deployed.
I will give some practical reassurance on that, such as it is. When submissions go up to ministers, they basically say, “Are you okay that we go with these policies? Do you require formal reporting on that assessment?” Ministers will see that before they make a decision.
Our intention is that, as the ministerial delivery group on climate action continues, there will be regular collective reporting on the net zero assessments that are put before the group, so that ministers can see where things have gone and the direction of travel. That can help inform the collective decisions taken on climate action policy going forward.
The evidence that we heard last week from WSP and the Climate Emergency Research Group set out the potential to apply net zero assessments to existing commitments as well as new decisions, so that the results can inform reprioritisation or reassessment of existing policies. Is that happening? Do you think that it should happen, and if not, do net zero assessments have sufficient teeth if they can influence new policy but cannot cause Government to reconsider existing policy?
That is an interesting question: how far back do we go?
I mentioned the question that I get asked about the assessment being burdensome, and I answer, “Actually, it is quite manageable because it is about the policies that we are bringing forward, so it allows us to make decisions.” We are looking at other mechanisms: there is other reporting associated with policies to see if they have borne out what we hoped they would. We do that constantly in Government.
I am just thinking on the hoof here. Let us say that I am looking at whether a policy is delivering on the climate action part that is in my portfolio, and I am getting reports back on the outcomes that it is meeting but I am not satisfied. Perhaps I would ask the team to look at it from a net zero assessment perspective—so I could do that in an ad hoc way. If we have the tools to do that, it could be helpful. However, looking at all the policies retrospectively, however far back, would be burdensome, and I would question whether that is the best use of resource.
I will touch on something that Claire Baker raised around transparency and reporting. From my perspective, I am here to scrutinise the Government, so it would be helpful to understand when a net zero assessment has been undertaken and the decision has been made. If a decision has been made that has triggered a net zero assessment, would that be automatically flagged to members and to this committee? Would that be on a regular basis, whether once a year, twice a year or quarterly, or would it actually be triggered automatically and done as a matter of course by the decision having been taken?
I will take that away and look at it. I write to the committee on decisions that I make all the time. The committee is kind of my go-to, because the committee needs to know what I am up to in terms of the decisions that I make. It could be that, when I write to the committee on something that I am doing, we give the information about whether a net zero assessment has been carried out.
It might just be because we have been embedded in reviewing this issue for the past few weeks, but if we got a letter from you saying that you had reached a decision on a new policy, my automatic response at the moment would be: does it include a net zero assessment? Even if the letter covered that off to say yes or no, my next question would obviously be: can I see it?
The net zero assessments are done to give information to ministers, but I take your point.
Can I take that question away? I do not know what it would mean for our process and letting the committee know things. I also come back to the fact that every spring there will be a net zero assessment annual report, so you will have that detail then as well. On whether it is good to have the information piecemeal throughout the process of making every decision and how we might do that, leave it with me. We will have a wee look and see how doable that is.
10:30
My final question is not remotely budget related. We had a screening of “People’s Emergency Briefing” in Parliament on Thursday. What were your thoughts, and will you go to a full screening at some point?
I am looking at where it will be screened in my constituency. October recess might give me time to go to it, although I am going to the biodiversity conference of the parties and a meeting of Under2 Coalition, so I will need to find out whether it is possible.
If I may be honest with you—I think that I said this to you at the time, David—going into the screening I was worried that it was going to be one of those films that we always see about how terrifying the situation is, but I was blown away by the different approach that it took. It was about solutions, and I was particularly impressed by the people who were chosen to speak to show their different perspectives.
The perspective of the ex-military person—forgive me, but I have forgotten his name—on geopolitics and the world conflict that could come about as a result of not addressing climate change was so powerful. I came away very impressed by the approach and the conversational nature of the film, and I wanted to speak to people about it afterwards, so I hope that I get the chance to see the full thing. The 35-minute version that we saw was powerful in itself. I will wait to be further impressed.
We are giving a lot of thought to how we can screen the movie across the Scottish Government, too. Having seen it, I know that it has a power for representatives and politicians, and it should have an equal power for civil servants. We are trying to think how best to do that, and we are actively considering it.
Thank you.
In last week’s evidence session, Lewis Barlow of WSP used the phrase,
“whenever you can estimate cost, you can estimate carbon.”—[Official Report, Climate Action Committee, 1 October 2026; c 5.]
I see Mr Raines is smiling. Is that a fair assessment?
I would need to unpack that a little and think about it. If I may add another one, I would say that we should also be able to estimate the cost benefit. I will just throw that in there.
No problem.
I never want to contradict Lewis, who is clearly an expert on the area, but getting to a cost will involve a lot of different methodologies. To get to a cost and to look at the different policies, you are looking at a range of things. Some of the methodologies for working out the carbon impacts of some costs are very well understood—they are off-the-shelf processes, if you will, that are easy to take forward. Other processes are probably more in development.
It is easy to work out the costs of a whole range of things on climate resilience, for example. However, if you want to look at not just the carbon impact but the wider impacts in terms of health benefits and a whole range of impacts that might arise from policies, we are getting better at the methodologies for doing that but the process is maybe more in development than it is for other aspects. Therefore, I think the principle is correct, but how true it is across the full range of things you can cost is still to be tested.
Thank you.
I have been following the really good discussion this morning. I had a look at a level 4 budget spreadsheet and I could not see this, but is there, or could there be, a place where we see the budget—the fiscal bit—and then we see the carbon related to that? The taxonomy element would be the gross amount, but it would be great to see the carbon for the level 4 budget—for a budget line item. Is it the case that that exists and I just missed it, or does it not make sense to do that?
We would have to go away and look at that. The working is there, but given the large range of level 4 budgets and what have you—maybe this touches on the points about accessibility—I suspect that it would be budget wonks, if I may use that expression, who would look at how it could be presented. There is definitely an argument for providing information in that way, but we would have to look at what is presented currently and what more could be presented.
I think it would be helpful. Today, across the Parliament, we are doing pre-budget scrutiny, and I feel as though we are scrutinising a process, rather than diving into the transport budget or another specific budget. Maybe we could look at that next time, or when we are doing pre-budget scrutiny in the future, in order to really dig into it.
The housing budget is the one that I use as an example. That sort of information would allow us to dig into the information and support you, in our scrutiny work, to look at the numbers. That is what is happening in other committees at the moment. As a brand-new committee, it has been really helpful in relation to the climate remit to do this piece of work and get a better understanding of the different strands.
Next month, we will be doing a six-month review of the net zero assessments, which will inform some of the information that we give the committee in spring. A year from now, Phil Raines and I will be able to go through some of the things that we have tweaked and changed—it has to be working for us and adding value to what we are doing.
As there are no further questions, cabinet secretary, I thank you and your officials for your contributions this morning. That concludes our business in public and, as agreed earlier, we will move into private session for the remaining agenda items.
10:37
Meeting continued in private until 11:01.