Chamber and committees

I am always open to suggestions as to how we ensure the best understanding of decision making and priorities. I am pleased that people want us to do more—that is a good thing. It reflects the fact that people feel that, even though our budget is relatively small compared to that of other international development partners, Scotland’s input is still welcome.

I know that because, for example, the Zambian President is in Scotland at present—I am sorry, but I think that I said Zaire a moment ago; I meant to say Zambia—and we have projects in that country. We know from him, his Government and civil society partners in that country, as we do from our other partner countries, that Scotland’s contribution is valued.

However, along the way, having that good relationship with our partners and explaining how we make the decisions that we do is an integral part of maintaining that high level of trust and welcome for engagement, and that is something that we are keen to maintain with our charity and third sector partners as well as our partner countries. The fact that we have Government relations and Government visitors here from those countries as well as an on-going relationship with the third sector in those countries is proof that things are working.

The first thing to state is the obvious, which you have already heard from those who have given evidence to you: the TCA is a significant step backwards in our economic and trading relationship with the EU compared with the benefits that the UK enjoyed as a member state.

The evidence that you have heard in the inquiry has illustrated that already. Brexit has generated bureaucracy, costs and delays and created complexity for Scottish businesses. There are barriers to trade, which have exacerbated recruitment challenges and held back investment on a significant scale. The UK economy is now 2.5 per cent smaller than it would have been in the EU, and the gap could increase to 5.7 per cent by 2035.

Things can be done, which Scottish Enterprise—the national economic agency of the Scottish Government—deals with, as do Scottish Development International and our colleagues in the Scottish Government office in Brussels. There is a constant effort to work out how we can ameliorate the challenges. However, there is only so much that can be done.

Our relations with the EU are a matter for the UK Government, which sought a hard Brexit. We now have a hard Brexit and hard consequences. We will do what we can around the edges—we will perhaps come to that when we discuss the TCA, with very specific examples of where slight improvements might be sought.

On the big picture, though, unless the UK seeks to rejoin the European single market or join the European Union as a whole, we will continue with all these disadvantages. We will work together with business and with exporters and importers as much as we can, but there is no getting round the hard facts: Brexit is Brexit; it is bad; and it will continue to be bad.

Okay—fine.

On the point about relief in the sector that we are turning a corner in funding, a significant number of people in the sector have been very kind about the fact that we have been able to secure increased funding for culture while, unfortunately, because of budgetary constraints, that is not the situation elsewhere, in other parts of Government. I am grateful for the support of people in the sector in being able to make their case. It is important that we do everything in our power to ensure that the sector thrives.

On the difference between sustaining and developing, Ms Forbes echoes a point that Donald Cameron made at the previous evidence session that I attended, about organisations that may perform a very important community role but that might not be on a trajectory to be financially self-sustaining. Such organisations may clearly have an important community or wider role to be supported.

I am very alive to this point. There is, indeed, a tension between sustaining what matters—which may or may not be self-sustaining or profitable in a budgetary sense—and developing the sector writ large. I underlined this point in my opening statement, and I am trying to find the wording that I used. I am very keen—as, I know, Creative Scotland is—to consider how we can help cultural and arts organisations to build in the resilience, financial sustainability and, importantly, capacity that they need to thrive.

We can do a lot more of that, because it is different from what Skills Development Scotland or Scottish Enterprise might offer in the wider economy. However, given the experience that we have gone through with the changing nature of society and its interaction with the culture and arts sector, we need to help the sector to manage its room for success more effectively. We need to think anew about how we make that happen. That is where joining up our financial capabilities and additional funding streams will be the answer to Ms Forbes’s conundrum.

I have just confirmed, again, that it is cumulative, so it is just over £40 million additional.

I have now said this three or four times, I think, so there should be no doubt about the clarity of the commitment that has been given about the additional £100 million. However, in terms of the route to get there, we are talking about £15.8 million in this budget and an additional £25 million in the following one—so that will be an additional £40.8 million—and then, in the two years after that, the numbers will be dependent on the budget discussions that take place in the usual way.

If I think back to previous discussions, there was a sense of doubt from some colleagues about whether this is a real thing. It really is a real thing. It is not an aspiration. In comparison to other Governments in the United Kingdom, including Labour-run Wales, which has cut its culture funding, we have increased it. Unlike the UK Government, which has cut culture funding this year, we are increasing it.

We have given the commitment—the Deputy First Minister did it in the budget statement—on the £25 million additional in the financial year 2025-26. As soon as I can, I would want to be able to confirm what the subsequent years will deliver.

I totally understand that the sector wants the front loading of funds. It is what I want—absolutely. It is what I argue for internally, and I want this to happen as quickly as possible. It is correct to say—and Iain Munro is absolutely right to say—that what we are able to do this year is very much within the sustain phase of the culture and arts recovery. As we are able to secure the additional cumulative totals that will boost the culture and arts scene, we will be able to support the sector in a much more significant way to develop and innovate.

First, that is not a sensible suggestion, given that a majority has been elected to the Scottish Parliament with a mandate to pursue Scotland’s independence. Secondly, in the grand scheme of the budgets that we are talking about, the amount is minute and it would make absolutely no serious contribution whatsoever to the scale of the funding challenge that we have as devolved Scotland. If that is the limit of ambition in relation to being able to reallocate money and deliver public services in Scotland, we are in real trouble.

I have always taken the view that it is really important to try to understand the perspectives of different people in different organisations. In this case, I see Creative Scotland demonstrating the demand in the culture and arts sector. If you ask organisations in that sector, “How much money would you like, in an ideal world?”, you will get a massive total, and what that illustrates for an organisation such as Creative Scotland is that it would like the maximum possible funding settlement. I understand that—that is what it wants. I understand that, whether it be Creative Scotland, individual organisations, venues or whatever, people who are receiving support either directly from the Government or through agencies need to illustrate the extremity of the situation as a way of securing support—and the situation is, indeed, very challenging.

The first thing that I would like to say, then, is that I understand why Creative Scotland and its board members are very keen to ensure that they have the funding to get through the massive change programme required for multiyear funding. That is why I was very empathetic in my opening statement and in my answers to the committee’s initial questions about what is being done at present. I work very well with Iain Munro and colleagues at Creative Scotland; I work very well with Isabel Davis and colleagues at Screen Scotland; and I can say the same for Historic Environment Scotland, our national collections and our national performing arts companies. I do not have a problem with any of that.

Is there what one might call a creative tension here, given the very nature of the process? The Scottish Government dispenses funds and organisations that receive them want as much as possible—I understand that. Given the constraints, people have wanted to gain public understanding as well as an understanding in Government of the requirement for money.

I definitely agree, though, that there is a profound lack of understanding about the extent of the financial constraint on devolved Administrations in the United Kingdom. It is unprecedented, and I have not heard a single person, whether it be a member of the Scottish Parliament, someone from an agency, a journalist or anybody else, contribute any suggestion as to where, this year, any additional means that one might want would come from. Nobody, but nobody, has come up with a suggestion on that front—not one.

This year, we have been able to make the case internally for a down payment on additional funding going forward, and no doubt everyone in receipt of funding will want to ensure that they get a part of that. I have talked at some length—and no doubt, convener, you will have me back to talk about it again—about how this new approach will work from the perspective of the Government, our agencies and beyond. We will have to be in a new place. I am working with the people in Creative Scotland and other agencies on the basis of trust and I am confident that we have a trust that is good enough to be able to deliver all that.

I do not think that there is a single, silver bullet through any of the different organisations or funding streams to help the Scottish culture and arts sector to thrive in a way that we all agree on.

Having said that, I think it is right that we consider all potential options for supporting the culture and arts sector. We have to acknowledge that other countries are further ahead of us in some respects. The visitor levy is a good example of that. The overwhelming majority of countries across the European Union have a levy, and I am not aware of any evidence that suggests that it has a detriment on tourism spend. Indeed, it has the benefit of bringing in additional funding to municipalities and regions.

Similarly, the percentage for the arts scheme has the potential to provide additional funding, and there are other suggestions that we have discussed in the committee and in the chamber. For example, Mark Ruskell regularly brings up the issue of a tax on tickets as another potential route to gain additional funding. I have thought for quite a while that, in addition to what local and national Government do, we also have an opportunity to work much more closely with people, or the trusts and foundations that they may be involved in, who give money to the sector. I think that we can work much better together with the philanthropic sector domestically and internationally. I look forward to exploring all those things.

As to your point, convener, none of those things provide the single answer to the concerns about the funding situation that the sector has been going through, which we know well, but they could all play a part in the answer to helping it to be as well funded as I hope we all agree that it should be.

I acknowledge the importance of those funds for Creative Scotland as it goes through the significant funding change to multiyear funding. The Scottish Government is providing public funding to make up for a reduction in national lottery support that was intended to be provided for only three years and has now been extended. Notwithstanding that, I appreciate how important those funds are for Creative Scotland as part of its transitional planning, and to the regularly funded organisations that will form part of the multiyear framework. Those funds are also important for the financial means to support wider parts of the creative and arts sector that will not form part of that multiyear funding approach.

Creative Scotland is right to want to ensure that the transition works well and that there is no cliff edge for the organisations, venues and other projects that it supports. That is why I have been persuaded of the importance of the funding, given that the priorities that I have set out from the Scottish Government’s point of view align with those of Creative Scotland, as a way of ensuring that we make that change.

The previous time that I gave evidence, I drew attention to the fact that the third sector in particular in Scotland has been crying out for that multiyear approach in order to give financial certainty and to reduce the amount of time that is currently spent applying for funding on an annual basis. Creative Scotland is absolutely at the vanguard of that change, which is why the issue of the £6.6 million from the previous financial year came up. We gave a commitment—I gave a commitment at a meeting of this committee—that we would restore that funding. I am delighted to confirm that we are doing what I undertook we would do and that there will be an additional year’s funding of £6.6 million.

It is worth noting that that is significantly more than the national lottery funding shortfall, but notwithstanding that, I accept, agree and value the importance of that funding as part of the transition. To my mind, it falls very much within the phase of sustaining the current arts and culture infrastructure.

As we begin to have more finance in the culture and arts sector, which we have secured because of commitments that were made by the First Minister, agreed by the Deputy First Minister and supported by me for quite a long time, we can then look to the medium term in respect of some of the ambitions that Mr Ruskell has outlined.

However, there is a footnote to that, which I never hesitate to make and that is quite important: Creative Scotland is—quite rightly—an arm’s-length agency, and, as such, it is an organisation with which we agree a general direction of travel. I have outlined our perspective on that, but it is for Creative Scotland to make decisions about all that when it comes to individual projects.

I am pleased, as I know that Creative Scotland is, that there is more money for culture in Scotland this year, which is not the case in other nations in the United Kingdom, and that our financial commitment is significant and will continue to grow cumulatively over the next years.