Chamber and committees

I am not sure that the running commentary helps the discussion of such matters.

The two Governments have set out the approach taken to making a difficult set of decisions about very strong bids. I sympathise with those who have been unsuccessful and, as I said in my statement, the Governments will engage with the unsuccessful bidders to identify how we can take forward some of those strong propositions.

In relation to Mr Smyth’s comments about the position of workers, in my statement, I went to great lengths to address the fact that the construct of green freeports in Scotland was deliberately designed to protect workers’ rights. That was an essential prerequisite to the Scottish Government’s participation in the exercise. We were not prepared to participate on the basis that was proposed by the UK Government for the English freeports. We did not think that protections were in place for workers’ rights, which were successfully negotiated as part of the process.

I am confident that those rights can be assured, but as I said in my statement, I also give Parliament the assurance that governance will be in place, there will be accountability and we will be able to monitor how the agreements and commitments are fulfilled by the delivery of green freeport status.

Scotland is living through unprecedented and difficult economic times. Our households, businesses and communities all face continuing challenges arising from the combined shocks of Brexit, the Covid-19 pandemic and its aftermath, the war in Ukraine and its impacts on both our economy and our energy security, and the acute cost of living crisis that is confronting us all.

Now more than ever, we must use every tool at our disposal to maximise the opportunities that we have in Scotland’s different regions, and, in doing so, we must support the regeneration of disadvantaged communities, promote the creation of high-quality jobs, advance our fair work agenda and accelerate Scotland’s just transition to net zero. That sits at the heart of our plans for Scotland’s future economy.

The announcement on green freeports that we made jointly with the UK Government last Friday should therefore be seen in the twin contexts of our national strategy for economic transformation, which was published last March, and the draft energy strategy and just transition plan, which was published last week. The economic strategy sets out our overarching vision for a transition to a stronger wellbeing economy that will build our future resilience to shocks—be they economic, social or environmental—and will support Scotland’s people to thrive and prosper. It describes how a wellbeing economy will drive a green recovery that will meet our climate and nature targets while ensuring that the transition to a net zero future will be a just one, as well as how we will build world-beating clusters of manufacturing excellence in Scotland’s globally competitive high-technology sectors of the future.

In that global context, the energy strategy and just transition plan maps out the future of the energy sector and sets out an ambitious plan of action to realise that bright future. It includes actions for the Scottish Government, industry, regulators and—vitally—the UK Government. That is the backdrop for Scotland’s green freeports. When the Minister for Business, Trade, Tourism and Enterprise announced our co-operation with the UK Government on green freeports to the Parliament last February, he explained how we had negotiated a distinctively Scottish approach, building on our own green ports model to modify the English freeports to suit Scotland’s needs and priorities. In particular, he emphasised how the approach would give top priority to regeneration and high-quality job creation, how it would support our journey to net zero, and how it would embed our fair work agenda at its heart.

The competition that we launched jointly last March, on the basis of a detailed prospectus, embodied that approach, and the outcome of the competition amply justified it. Taken together, the two winning bids from the Firth of Forth and Inverness and Cromarty Firth aspire to create some 75,000 new, high-skilled, well-paid jobs; bring forward nearly £11 billion in private and public investment; deliver a significant enhancement of our offshore wind manufacturing capacity; advance alternative fuel production, including green hydrogen; and promote innovation and trade across multiple sectors.

I will speak in a moment about the next steps in this process but, first, it is important that I set out the assessment and selection process.

We were clear from the outset that the process needed to be rigorous, fair and transparent. It also had to be a balanced one in which both the Scottish and United Kingdom Governments had an equal say. Therefore, the applications were assessed in parallel by Scottish and UK Government officials, looking at all the different aspects of the bids against the policy and delivery criteria that were published in the prospectus and using a common assessment framework.

The results of that assessment process were then subjected to independent moderation by senior officials from both Governments and validated by a joint programme board before an information pack was submitted jointly to Scottish and UK ministers with the assessment outcome and a list of the appointable bids. I then held several discussions with the Secretary of State for Levelling Up, Housing and Communities and the Secretary of State for Scotland, to consider the outcome and decide on the two winners.

The decision was not an easy one. It was a very strong field, and I express our thanks to all those who were involved in submitting the bids. It was a choice between five high-quality applications. However, on the basis of the joint assessment, which was thorough and robust, UK and Scottish ministers were agreed that the Firth of Forth and the Inverness and Cromarty Firth bids were the strongest ones.

Officials from the Scottish and UK Governments will now work closely and at pace with representatives of the two winning consortia to set up robust governance structures, develop detailed business cases to unlock start-up funding and move towards delivery on the ground. We hope that the two green freeports will be operational before the end of this year. Ministers will keep Parliament informed of progress.

While acknowledging the success of the two ambitious bids from Inverness and Cromarty and the Firth of Forth, which could be genuinely transformational, I would like to say a few words about the unsuccessful bidders. Officials from both Governments have written to each of the unsuccessful bidders, offering feedback, and we will publish more information on the process in due course in order to provide further transparency on the decision-making process. As I have said, the field was a strong one and there were some very promising proposals in each of the applications. I am conscious of the investment of time, resource and expertise behind each of the bids, and, beyond that, I am acutely aware both of the economic opportunities across the different regions covered by the applications and of the challenges that they are currently facing.

Therefore, officials from both Governments stand ready to work with each of the unsuccessful bidders to consider whether and how it might be possible to build on aspects of their plans outside the green freeports programme, to deliver jobs and growth in their regions. They will engage with the local authorities and their partners in the north-east, Clyde and Orkney, particularly through the regional economic partnerships, to discuss how targeted propositions could be developed in the context of the economic strategies that are in place and under development for the regions, and they will review whether specific sectoral elements of the bidders’ plans could be progressed through other relevant cross-Government programmes, taking a team Scotland approach. For example, they will look for opportunities to build on the themes and actions in each of the relevant growth deals. Further, given the unique potential of the north-east in the field of carbon capture, utilisation and storage, we continue to press the UK Government, as we have for some time, to set out a timeline for track 2 of the CCUS process that will ensure swift delivery of the Scottish cluster, including the Acorn project. That would be transformational for the region, and it would represent a critical step in Scotland’s journey to net zero.

Finally, I want to acknowledge and address some of the concerns that have previously been expressed by some members about freeports more generally. As my ministerial colleagues and I have said before in the chamber, we are well aware of the mixed views on, and the reputation of, some freeports elsewhere in the world. We understand the critical importance of protecting workers’ conditions and rights, we understand worries about potential displacement of economic activity from elsewhere, and we understand concerns about deregulation and potential illicit activity. Therefore, we have sought to address those issues in the approach that we have negotiated with the UK Government.

First, we required bidders to commit to the principles of fair work, including payment of the real living wage and the enabling of an effective workers’ voice, and to outline how they proposed to embed them across the green freeports. Both of the winning bidders offered firm commitments on that. We will pursue those commitments with them in more detail as we move from initial decisions to the business case phase and onwards to funding and delivery, and we will hold them to their commitments as we monitor progress on the ground.

Secondly, we will require the successful bidders to develop and report on their plans to monitor, mitigate and report any potential displacement of economic activity.

Finally, the green freeports will be required to adhere to the Organisation for Economic Co-operation and Development’s code of conduct for clean free trade zones, to comply with tough UK regulations to prevent money laundering, and to establish—and share with enforcement agencies—a register of all businesses that operate within the tax sites. The operators of any customs sites will require prior authorisation by His Majesty’s Revenue and Customs. All the activities of the green freeports will be subject to close monitoring and evaluation, so I am confident that the significant economic potential of the two green freeports will be accompanied by high standards of governance, transparency and enforcement.

The announcement last Friday marked an important milestone. The creation of the two green freeports will support businesses to create large numbers of good green jobs, will promote growth and regeneration, and will make a significant contribution to our transition to net zero. They will help us to create internationally competitive clusters of manufacturing excellence, which will build on specific areas of sectoral strength and be able to compete on an equal footing with ports in the rest of the United Kingdom and internationally. Over time, they should yield real and lasting benefits to Scotland’s local, regional and national economies. The hard work to deliver on that promise starts now, but I am very optimistic about the potential.

The Labour Party is really excelling itself in its lack of cheerfulness today. I do not know what is in the water. Any cheerfulness has certainly not reached Mr Smyth or Mr Johnson.

The Government has made a statement today to transparently explain a decision-making process that we have been involved in with the United Kingdom Government.

In addition to that, the Scottish Government is investing in a variety of propositions around the country, whether that is the Aberdeen city region deal, the Tay cities deal, the islands growth deal that I mentioned, the Ayrshire growth deal or the Glasgow and Clyde valley city deal. All those include elements that will address exactly the issue that Mr Johnson has raised.

Those are 10, 15 and sometimes 20-year sustained policy commitments that are in addition to the investment that the Government is making in the country’s infrastructure. We are determined to make sure that we realise the benefits of renewable energy production, which is Scotland’s great opportunity in the years to come.

I think that that is an entirely reasonable request. Ministers would be happy to do so.

Mr Lumsden should be familiar with the contents of the Bute house agreement, which set out the Government’s approach to the A96 dualling project. In that agreement, we set out specific commitments and the process of evaluation of the wider issues in relation to the routes. Those commitments have not changed from the Bute house agreement.

Obviously, I am very familiar with the economic challenges that are faced in Mr Coffey’s constituency and in Ayrshire more widely. Those challenges are the reason why the Government has been so engaged in, for example, the Ayrshire growth deal, and why huge amounts of time and energy were spent on securing the Mangata Networks investment at Prestwick airport. That is a huge strategic development, albeit that it is not in Mr Coffey’s constituency but in his neighbour Siobhian Brown’s constituency of Ayr. I recognise the economic disparities, which is why we concentrate on that investment.

On the development of connectivity to Ireland from Ayrshire ports, obviously ministers would be happy to engage with Mr Coffey and his colleagues from Ayrshire to see what can be done to advance that agenda.

Dundee, which is in Mr FitzPatrick’s constituency, has benefited significantly from the Tay cities deal. The universities are benefiting, with £25 million from the Scottish Government going towards enhanced infrastructure for life sciences innovation at the University of Dundee as well as support for the refurbishment that led to the cyberQuarter development at Abertay University. That development opened in June last year and aims to support 150 businesses in the cyber security sector, which is absolutely vital given the developments in the global economy.

Not quite in Mr FitzPatrick’s constituency but at the other end of the city, the investment from the Scottish Government in the Michelin Scotland Innovation Parc is significant in supporting the development of new opportunities. If Mr FitzPatrick will forgive me, I will also mention the James Hutton Institute, in my constituency, which is close to the boundary with the city of Dundee. The developments there are welcome into the bargain.

The Scottish Government has identified a range of high-level indicators that will help to measure progress towards achieving the individual outcomes in the Covid recovery strategy. The majority of our outcome indicators are drawn from population surveys or large administrative data sets that report annually and which are more measurable than the outcomes themselves. We are working to identify additional intermediate indicators that report more frequently and can therefore identify and influence real-time trends.

The financial situation, including high levels of inflation, is particularly challenging, given the absence of fiscal powers to compensate for those factors. The Scottish Government has prioritised spending that supports the people who need it most, guided in part by the principles of the Covid recovery strategy. Last year’s emergency budget review and the 2023-24 budget provide funding that helps families, backs business and protects the delivery of public services. The Scottish Government is committed to making progress towards the shared Covid recovery strategy outcomes in partnership with local government and other partners and will continue to prioritise spending that is targeted to support the people who are in most need.

I accept Claire Baker’s point that one of the challenges is to ensure that people fully utilise the benefits to which they are entitled at the moment in life that they are entitled to them. We take a number of steps—my colleague the Minister for Social Security and Local Government has set out some of that information to the Parliament previously—to raise awareness of individual benefits and maximise take-up. That is our intention, and it is our desire to ensure that that is the case. Awareness-raising measures will be taken, and we will obviously look very carefully at the effectiveness of those. The Government’s marketing strategies generally result in good engagement and participation, but I will look specifically at Claire Baker’s points to identify whether we need to take further action to raise awareness and boost participation.