Chamber and committees

I will certainly take that point away and reflect on it. I am sure that the committee will, no doubt, raise it in its report as well. There are not necessarily any easy answers to those questions, but I assure you that we are conscious of the issue, as we have had similar feedback from groups.

If anyone has the answer on how to avoid trade-offs, I am all ears. That is something that we all struggle with and always have. Clearly, you have to take a decision at some point to open funds and work with people to make the best of what is available. There is no way of avoiding trade-offs. You mentioned that Forres, which is the most affluent ward, receives funds. The projects will benefit the whole community. Looking at it through just one lens is not always helpful. Obviously, I would have to check exactly what Moray TUC said, but you get my gist.

A lot of the projects are about tackling some of the inequalities that I mentioned at the beginning of the meeting. The just transition is about creating good green jobs and tackling some of the social ills and inequalities in society. Some people who live in energy-rich Moray cannot afford to pay their fuel bills, and we have to address such issues as part of the just transition. If some of the small local projects can help to make a difference to some local people, they are important. We have to spread that ethos throughout the country for the national transition across Scotland.

That is a good question, and it is, of course, a question that I hear often. The just transition principles are, of course, reflected in the Climate Change (Scotland) Act 2009. When I meet people, I define the just transition in as straightforward a way as I can, as a way of ensuring that the transition to net zero is managed and planned, and I explain that the measures that we take and the policies that we implement to go towards net zero are carried out in a fair way, do not leave people behind, and are co-designed with the people most affected. Clearly, creating good green jobs for people in Scotland, particularly those in the sectors that are most impacted by the transition away from fossil fuels to low-carbon technologies, is at the heart of that. Most people I have spoken to in organisations, including Aberdeen City Council, have accepted that when I have met them, and I think that there is broad agreement about the aims and general principles of the just transition.

There is always a debate, because a just transition can mean all things to all people. It is not just about jobs. Jobs are at the heart of it, but it is also about using the economic transformation that we will be going through in the coming decades between now and 2045. There is a massive window of opportunity to fix things that we do not think are right and we think are unfair in our society and economy, including fuel poverty and many other economic issues. As we go through that economic transformation, we have an opportunity to fix some of those things in our society.

I agree with a lot of the sentiment that has been expressed to the committee on the issue. I have been in the Parliament since 1999, and many people around the table have been in the Parliament for some time, so they are aware as much as I am of how quickly the agenda has changed and how the issues of the just transition and net zero have rocketed to the top of the agenda in the past few years. Society and the world are changing fast, and the debate about net zero, as we see in the daily news, is now at the forefront.

I accept that we have to measure better what we are achieving with the just transition policy in Scotland. On the just transition fund, for instance, the first couple of years have been just about getting it off the ground and going. If you go to north-east Scotland, for instance, you will see that a remarkable transformation is under way. Amazing things are happening. I am lucky: as a minister, I get to visit a lot of the places and meet the people involved, What is happening just now in north-east Scotland and other parts of the country with the fund and the many projects is hugely inspirational. It is not just about the just transition fund; there are other funds and initiatives under way in north-east Scotland that you will all be aware of from your inquiry. Things are happening, and we have to measure that.

At the moment, we have biannual reports to take stock of where we are with all the funds and the projects. I am keen to develop the next phase of that in 2024, so that we can have proper reporting in place to look at the job implications of what has been created, as well as the wider investment.

One of the issues that I have raised with officials so that we can address that is that the just transition is not just one aspect of policy or about one fund. There are lots of different sources of support and activities under way across Scotland, particularly in the north-east, at the moment to support the just transition. We have to bring that together and tell the story and then look, as a country, at where we are with the just transition.

I assure the committee that, among those projects—I am happy to make sure that this is all copied to the committee—there are some community projects, as well as business projects and big projects. It is about trying to balance being transformational with ensuring that there is change at a community level and that we have bottom-up projects. I absolutely understand that.

Those are good questions. Indeed, we touched briefly on the issue earlier, and I am determined in 2024 to try to ensure that we move forward on it. The first couple of years were focused on getting the fund up and running. If we had waited to answer some of those questions, we would rightly have been criticised for not getting the fund up and running and for taking a couple of years to sort out the processes behind the scenes. There are, of course, processes in place, but we understand that we have to show how everything is measured.

The objectives of the fund are to support the strengthening of the economy in north-east Scotland and Moray, to decarbonise and to deliver the principles of the just transition, which we have already discussed. We want the projects and how the funding is used to be co-designed, and we want a bottom-up approach in the region. That has been happening.

The just transition is about creating good green jobs as well as strengthening communities, and there is a variety of projects in that respect. I am trying to remember the name of that film—is it “Everything Everywhere All at Once”? Some people I speak to see the fund like that—that is, that it should deliver everything. You can take any subject and, perhaps, put it under the remit of the just transition fund. Of course, we have had to filter things out and make sure that the projects that are coming forward are discussed with the local enterprise companies and the local authorities. We then take a decision on what are the best projects to deliver the broad objectives of the just transition fund.

Thank you very much, convener. Good morning, committee. I thank all of you for the opportunity to speak to the committee today.

From my perspective, the committee’s inquiry into the just transition fund for north-east Scotland and Moray comes at a really good time, because I am keen to reflect this year on the fund’s first two or three years and our approach to a wider just transition, which, of course, continues to evolve. That is a living, breathing concept. There is no blueprint for it, given that no country has done it before, so I am very keen to have your feedback today, and I look forward to the outcomes of your inquiry.

At the heart of the Government’s desire for a just transition in Scotland is the fact that we do not want to repeat any of the mistakes from Scotland’s past. We are all aware that we continue to feel the impact of the rapid decline that was inflicted on many of our heavy industries, particularly in the 1980s. Obviously, the closure of the coal mines is the example that is often cited as part of that debate.

For me, a just transition is about ensuring that the positive impacts of reaching net zero are felt throughout our economy and the whole of society, and that they bring tangible benefits to all our citizens, especially with regard to jobs and skills, affordability and living standards. Supporting positive outcomes for communities, places, workers and businesses is fundamental to the just transition approach.

Change is always challenging, of course, but the north-east and Moray have a crucial role to play in our transition to a greener future. We have to harness the area’s skills, talents and expertise in order to support the build-out of our low-carbon technologies and to tackle the existing issues of fuel poverty and energy security, as well as to safeguard a future for the many oil and gas workers and offshore workers we have, particularly in that region of Scotland.

We have, of course, already undertaken a lot of work to create new jobs—in the offshore wind sector, in particular. There is no doubt that the opportunities that are provided by Scotland’s resources are vast and that the region of Scotland that we are talking about is very well placed to take advantage of them. Exciting projects are already under way in the region. Our just transition fund for the north-east and Moray has committed £500 million of investment over 10 years. That recognises the unique circumstances of the transition of our oil and gas sector and its particular concentration in the north-east. We have an urgent responsibility to provide a just transition that protects opportunities for workers and communities, as well as supports and underpins the region’s economy.

Despite the fund being at a relatively early stage, we have already allocated £75 million. That has supported around 24 projects so far, as well as a range of other activities to support commercial investment through the Scottish National Investment Bank. Our funding support is helping to finance organisations, businesses, communities and individuals in transition, creating jobs in low-carbon industries, and supporting the provision of skills in the region.

The first just transition commission stressed the importance of a planned and managed transition to net zero. That is why we have committed to delivering just transition plans for our sectors and regions and, in some cases, individual sites. Good planning is critical to providing certainty for communities, businesses and workers about the changes that will happen and those that are already under way. Accordingly, we have put engagement and co-design at the core of our planning and policy to ensure that the people who will be impacted by the transition have their say. That is, of course, a key principle of the just transition. Without societal buy-in, it will be impossible for us to reach net zero in a fair way.

We are making a lot of progress. There are lots of lessons to learn and, obviously, there is lots more to do in the future.

As I said at the beginning, there is no blueprint for this. Scotland is attracting international attention because of the way in which we are approaching a just transition, but we have to reflect on the first couple of years of the fund in particular, as well as on the overall approach. Therefore, I am keen to get your thoughts, and I will do my best to answer your questions. I will get back to you with anything that I am unable to furnish you with at this meeting.

I look forward to the exchange and to today’s session.

The short answer is yes. We warmly welcome the report from the just transition lab at the University of Aberdeen, which is an innovation in the university in the past year or two. That shows the pace of change. The lab has been created, and I know the academics who work there quite well. I know that the Cabinet Secretary for Transport, Net Zero and Just Transition, Màiri McAllan, who leads on the subject in the Cabinet, was at the university recently and met the lab to discuss that very report. We are keen to take on board its recommendations as part of our thinking going forward this year.

The revenue support for just transition and all these projects has massive on-going financial implications. I do not need to tell the committee how tough things are financially in the public sector and for Governments. Therefore, I do not have an easy answer to that at the moment; all that I can do is to continue to reflect on it. Obviously, the committee refers to that in its inquiry report, and we will use the opportunity to reflect further on it. It is just a financial issue in terms of revenue support. Also, capital is a way to achieve transformation. Capital investments often bring in and unlock private sector investments, so we are getting even more transformational projects through that means. That is why there is a big focus on capital. However, the point is well made.

On interaction with the UK Government, up to £400 billion has been taken out of the North Sea in oil and gas revenues over the past decades. Therefore, we have made the point many times to the UK Government that we believe that it could match the just transition fund for north-east Scotland. We will continue to make that point.

Interaction with the UK Government on just transition largely revolves around the North Sea transition deal and initiatives in which we have common aims. That supports a range of projects in north-east Scotland, as do other UK funds, when we are able to secure them.

A lot of the projects that are supported by the UK Government as well as the Scottish Government are bottom-up projects. They are proposals from the north-east of Scotland. I am thinking of the Net Zero Technology Centre, which is a fantastic initiative and project in Aberdeen; I think that I am right in saying that it has attracted UK as well as Scottish money. There are projects that originate in the north-east of Scotland that attract UK funds and have a just transition theme.

I am sure that there is more capacity to ensure that the UK Government works more closely with us on just transition principles. There is a lot of engagement on a just transition, particularly on climate change, net zero funds and offshore policy.