Chamber and committees

Thank you for the opportunity to speak to the committee today and to exchange views on the implementation of the trade and co-operation agreement, which has been an important focus of Scottish Government work since the agreement came into force on 1 May 2021.

I very much welcome the committee undertaking such a wide-ranging inquiry into the treaty’s implementation and hearing evidence from a range of witnesses. From the evidence that you have taken so far, it is clear that the Scottish Government’s priorities coincide, in many cases, with the priorities of stakeholders in business, education and civil society.

A large part of our work in recent months has been to interact with as many stakeholders as possible, including the UK domestic advisory group and the Scottish advisory forum on Europe. We are keen to ensure that we hear what they say and gather evidence from their expertise.

It is particularly timely for the committee to be carrying out this work at present, because we expect the review that is provided for in the agreement to take place in 2025-26, although it is not yet clear whether that will lead to consideration of substantive changes. The elections this year, in both the European Union and the UK, might also lead to new scenarios and to opportunities for improvement.

I turn first to the big picture. The Government strongly affirms that Scotland shares the EU’s vision of peace and co-operation; the founding principles of the European project are universal and are rooted in a belief in human dignity and freedom, expressed through democracy. We also share Europe’s global challenges and are determined to work together on shared solutions. The war in Ukraine, the conflict in Gaza and the continuing threat of climate change make the scale of the global challenges very clear.

Scotland voted clearly to remain in the EU, with majorities for remain in every local authority area in the country. Despite that clear democratic expression, the UK Government’s hard Brexit has been imposed on us, leading to many of the difficulties that your inquiry has already brought to light.

It is welcome that we have seen a modest improvement in the EU-UK relationship in recent months. It is overwhelmingly in Scotland’s interest for there to be a much more positive and mutually beneficial relationship between the EU and UK, and we will do our part to help to create that where we can.

As members know, the Scottish Government is committed to maintaining alignment with the EU, where such alignment is possible and will be meaningful in protecting and advancing the high standards that we share.

We continue to be a proactive and constructive participant in EU matters by engaging closely with TCA fora and by wider engagement with EU institutions and member states, including our active network of international offices and our support for inward visits here at home. For example, I had the pleasure in April of welcoming the EU ambassador for a busy programme of engagement with Scottish stakeholders. The Scottish Government is thereby doing everything that it can to mitigate the damage of a Brexit that Scotland did not vote for, minimise divergence with the EU and ease Scotland’s eventual return.

I turn to the priorities that the Scottish Government has identified in its work around the TCA, after which I hope that we can discuss our respective approaches to the challenges that we see.

I will focus for a moment on the higher education sector, which is so crucial to Scotland’s economy, society and reputation. Scotland benefited disproportionately from the horizon Europe and Erasmus+ programmes. We are pleased that, in January this year, the UK finally associated to the horizon Europe programme. Collaborating internationally is vital for our education and research institutions, and the Scottish Government has continually urged the UK Government to find a pathway back to horizon. We now need to ensure that we maximise Scottish participation in the programme, and I am pleased that work on that has already begun.

One of the fundamental rights in the EU—that of free movement—offered unique opportunities to our young people while we were in the EU. The Erasmus+ programme was a key element of that, and we have been strongly urging the UK Government to re-associate to the programme. We welcomed the recent proposal of the European Commission to open negotiations with the UK Government on youth mobility. I can only hope that that issue will receive fresh consideration after the UK election.

The committee has already heard about many other issues, which the Scottish Government also sees as important priorities and which include a sanitary and phytosanitary agreement and other trade easements, enhanced mobility arrangements for services and creative professionals, and electricity trading and wider energy co-operation, through which Scotland’s hydrogen sector has so much to offer.

There is no doubt that we have the technical knowledge to address all those issues. What we need is a change in mindset and to move to a place of trust where we can do business together.

I look forward to discussing with the committee those issues and other matters that members might wish to raise.

I and colleagues are always open to suggestions. There is an on-going dialogue with Scotland’s business organisations, which constantly feed back their experience about what is or is not working well for them. If there are any gaps in that provision, I am certain that people would be keen to hear what they are.

There is dialogue and regular discussion about all those things and I very much hope that suggestions are acted on—none have been brought to my attention that have not been. Mr Bibby or the committee might have examples of areas where there is room to improve. That is a good example of the purpose that inquiries such as this one serve in trying to make a difference where we can, notwithstanding that I hope that there is an appreciation that we are operating in a hard Brexit environment, which the Conservative Party and the Labour Party support.

Regular dialogue takes place between Scottish Government officials and their UK Government counterparts. In general, that does not involve ministers from meeting to meeting. Those are technical discussions that take place across a range of specialist subject areas. However, I found that there was an improvement in the pre-TCA meeting dialogue between me and Leo Docherty, when he was Parliamentary Under-Secretary of State for Europe. I had two meetings with him in relation to technical discussions on seed potatoes and other issues that the committee will be well aware of. There was definitely a marked improvement in how those discussions went. That reflected the fact that, in the discussions between officials, the message had been heard.

There are a number of subject areas in which there are technical areas—on seed potatoes, bivalve molluscs and so on—where, with good will, one might be able to make progress. In those areas, discussions have been held between officials, and then between me and my ministerial opposite numbers. There were also discussions on cultural performers and the restrictions that they are facing with cabotage and so on that have made things difficult for touring professionals.

The dialogue happens. In some respects, the situation is better than before. There have been more meetings than there were previously, and I know that some of the issues have been raised, but that is not the same thing as actually being able to deliver in relation to them. In that regard, we discuss where there are shortcomings. We have discussed the issues on seed potatoes, bivalve molluscs and touring professionals, which are three high-priority areas for us to try and get some progress on. UK Government ministers have said that they have heard our concerns and will raise them. We are allowed to view those discussions with the European Union, but we are not allowed to take part in them ourselves.

To date, on those specific examples, we have not yet got the outcomes that we are looking for. There is a system that brings our officials together and now brings ministers together, but we really need to look at outcomes and not just processes. The processes are better than they were. That is definitely the case, although there is still significant room for improvement. However, with regard to outcomes, there is still some way to go.

Nick Leake, would you like to add something?

Having called for the longest of times for the UK Government to rejoin horizon—incidentally, and perhaps we will come on to this, having also done the same for Erasmus+ and the creative Europe programme—it has now moved very much into the academic and research space, as Mr Ruskell has already identified. I must confess that that is not my area of responsibility in Government. I appreciate, as I think that he and committee members do, how important horizon is to the university sector, but my education and higher education colleagues will be in a much stronger position to answer that.

However, I know that it is being taken very seriously and that the opportunities are very significant. Having spoken to university administrators, including at Edinburgh university, I know how much they welcome a return to the horizon project. That underlines our view that it is necessary to continue the process by rejoining Erasmus+ and the creative Europe programme.

The Scottish Government has been doing preparatory work for a potential change of UK Government. It is prudent to do so. Unsurprisingly, that work involves a list of improvements that are reachable, which include rejoining Erasmus+, for educational co-operation; rejoining Creative Europe, for cultural co-operation; and reaching agreement with the European Union on a mobility agreement. We saw a recent proposal from the European Commission that that should be reintroduced and, essentially, that there should be a reset on relations with the EU. Some straws in the wind have suggested that a changed UK Government might take a different view. This week, we saw commentary on chemical regulations, in which the UK Labour Party suggested that it was prepared to take a different view of matters. We will be making a very strong case that a reset of relations with the European Union is a high priority for the Scottish Government.

However, to underline the point that Mr Brown has made, those are still, in the round, only going to impact on the margins of our relations with the European Union. The UK will not be in the room, it will not be at the table and it will not be co-determining European policies. The UK will remain outside the single market and will continue to operate in a Brexit—a hard Brexit—environment. That is the policy of the UK Labour Party as well as the UK Conservative Party.

I would not want people to get their hopes up that there will be a massive reset, such that the trade barriers will be reduced. In some respects, we run the risk that some barriers will be heightened, because the UK Government has yet to implement its border regime in its entirety and we do not yet have clarity from the Labour Party on whether it will do so. If it does, I think that we can look at there being additional problems in relation to our trade with the European single market.

On Northern Ireland, we already have evidence that its situation of being able to operate within the UK single market as well as the European single market is to its benefit. Traders in Northern Ireland have seen their exports grow, not only to the United Kingdom and the Republic of Ireland, but to the European Union. They are able to benefit from—I think that I am quoting the UK Prime Minister and his predecessors here—having the best of all worlds. Unfortunately, Scotland does not.

That is fine. I am happy to say all of this twice, if Mr Bibby would like me to do so.

First, in relation to the network that he mentioned, we have a network of Government offices in nine locations, the majority of which are in Europe. In European Union capitals, we have Scottish Government offices in Dublin, in Paris in France, in Brussels, in Berlin and in Copenhagen. In addition, SDI staff are located throughout Europe, and both work in concert to ensure that opportunities are pursued and companies supported.

A very good example of that—which I will raise in the next session, too—is a case study that relates to efforts in France to support Scottish exporters. That activity involved the Scottish Government office there and the SDI network working together, and the evaluation has been able to show that one event alone secured more than £5 million-worth of export orders. The network is therefore working very hard to ensure that it supports businesses small, medium and large, and it is not just the Scottish Government offices that are involved, but the SDI network, too. There are trade envoys as well—Madrid is another European capital where we have a presence—and the GlobalScot network feeds into that process, too.

Evaluations take place in Scottish Enterprise, which is ultimately responsible for SDI, and the Scottish Government’s network of offices also has an evaluation process. We have begun annual reporting: one annual report has already been published, and the one for this year is forthcoming.

We will come on to talk about evaluation at greater length in the next evidence session. I know that the committee has been looking at that and that you took evidence in Dublin about how the Irish Government does it. If there are any suggestions about how we can better supply the committee or others with information about evaluation, I am keen to hear them, because we should be rightly proud of how hard our offices and international network work to promote exports and inward investment.

Creative Europe is much more programme oriented. It is not the same as restoring mobility for all young people, which would include all younger people who are interested in creative pursuits. We need to appreciate that being part of Creative Europe is viewed as very important in the creative and arts community—the established creative and arts world. However, wider mobility is the big prize for all young people, including those who are just curious to travel in order to live, learn and experience.

In the wider sense, that mobility would fundamentally ease the issues for our younger artists and particularly our breakthrough artists, for whom being able to travel and tour in mainland Europe was always seen as an essential part of their career development. Many have reported that they are unable to travel or that the costs are prohibitive, so the offer of free mobility would increase their chances of career development.

The prize is there, and the good news is that the offer is still there, too. The offer is there for both. I know that, because I went to the Commission and asked. It said, “This is not one of those areas: if the UK said that it wished to be part of programmes like horizon, that would not be viewed as cherry picking.” Therefore, although I would wish it to be otherwise, even if the UK was to remain outside the European single market and outside the European Union proper, being part of Creative Europe and a mobility agreement is on the table, and I think that it should be grabbed with both hands.

First, I say good morning to committee members and to my officials who have joined the meeting.

We are very much at the start of the discourse about reparations in relation to climate change, and we are very much at the beginning of a discussion about the relationship of the developed world with the developing world and, in particular, those parts of the globe that are already seeing catastrophic climatic change. That includes very low-lying countries, particularly in the Pacific. We are just at the start of that process and, obviously, we will have further discussions about that.

Committee members will be aware that Scotland is a co-chair of the under2 coalition, which brings together sub-state Governments from around the world. That is one of the forums where we work with other Governments on how we can best co-ordinate our domestic activities. However, I am sure that the issue of our relationship with parts of the world that are facing the catastrophic effects of climate change will play an ever-greater role, and I am happy to ask my officials to update the committee on what the initial steps are. We have a long way to go on it.

The challenges are everything that we have learned thus far because, as far as I am aware, the big picture is not going to change. There is no substantive difference between the two main UK political parties that are standing in the current general election in relationship to the European Union. Neither is suggesting that we rejoin the European single market or rejoin the European Union itself, which means that the hard Brexit will remain just that.

As far as small and medium-sized businesses—and, indeed, all Scottish exporters—are concerned, there needs to be an understanding that the big picture is not going to change with a pro-Brexit British Government. The Scottish Government will do what it can at the margins, because that is the only area where we can have an influence, given that we are outside the single market and we have this hard Brexit arrangement. We will beat the drum and we will make the case, but it remains a fact that, under a Conservative Government or indeed a Labour Government, the UK and Scotland as part of it will have hard Brexit done to us, regardless of the fact that we did not want it to happen in the first place. The damage to our economy and our exports will, unfortunately, remain in place, even though I would wish it to be otherwise.

Of course, there is another option, which is to rejoin the European Union, and that is still a debate that is being had in Scotland. I am sorry that it is not being debated among the UK parties, but the Scottish Government’s position is still that we would wish to rejoin the European Union as a member state, which would obviate all these issues.