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Chamber and committees

Meeting date: Wednesday, December 14, 2016

Meeting of the Parliament 14 December 2016

Agenda: Portfolio Question Time, Taxation, Business Motion, Parliamentary Bureau Motions, Decision Time, Climate Targets


Portfolio Question Time

Regional Policy (Budget)

To ask the Scottish Government how its budget will take account of promoting regional policy. (S5O-00459)

Although I am obviously constrained in what I can say today, I can confirm that the draft budget will respond to the challenges that are presented by the European Union referendum and United Kingdom Government austerity, and will deliver the positive steps that are set out in the programme for government to build a nation with a dynamic, sustainable and inclusive economy that supports all Scotland’s regions.

I very much look forward to the cabinet secretary’s statement. I am sure that he agrees that we need a renewed focus on Scotland’s regional policy as Brexit fast approaches, given that many regional funds flow from Europe.

City deals for Aberdeen, Inverness and elsewhere, along with the islands initiative, are big steps forward. Does the cabinet secretary agree that we also need bespoke measures for places such as Moray, which I represent, which are not covered by those initiatives but face similar challenges?

On future budgets, will he support efforts in Moray, in particular to persuade the UK Government—but also to talk to him and his colleagues in the Scottish Government about it—to deliver a Moray city deal, given the enormous revenues that the Speyside Scotch whisky sector especially generates for the UK’s coffers?

In promoting regional policy, will the cabinet secretary consider measures including locating civil service jobs, especially new ones, in Moray and elsewhere around the country?

That was quite a comprehensive bid for tomorrow’s budget. I will take each issue in turn.

We should recalibrate our economic policies in the light of circumstances in order to support every part of Scotland. I have guaranteed continuity of European Union funds, following the UK Government’s guarantees to the Scottish Government.

On a city deal, I am happy to work with Moray Council to consider a specific request. The Cabinet Secretary for the Economy, Jobs and Fair Work deals with city deals and will also be happy to engage.

On civil service deployment, we have about 70 offices around the country—they are not just in the central belt. When we consider deployment of our resources and civil servants, we will ensure that we look at opportunities in every part of the country, with optimising quality of service and best value in mind.

Just yesterday, the Fraser of Allander institute produced its latest economic commentary, in which it says that

“The scope of a city to invest in productive infrastructure, skills, land redevelopment, and R&D is essential to its ability ... to shape and manage population and economic change.”

The institute went on to say that

“The OECD observes a strong correlation between fiscal decentralisation, prosperity and productivity ... There is also mounting evidence that fiscal devolution—or financial empowerment of cities ... creates an incentive framework that ultimately improves the economy, productivity and service standards.”

Does the cabinet secretary agree? If so, will he point to the Scottish Government policies that are designed to realise those policy goals?

I have a great deal of sympathy with the proposition that metropolitan districts—the cities—are drivers of the economy and regional growth. In response to Mr Tomkins’s request for an example, I can point to the Glasgow city deal, to which I was a signatory on behalf of the Scottish Government, when I was Minister for Local Government and Planning. I am happy to talk to local government and the Convention of Scottish Local Authorities about further empowerment and about economic packages that would stimulate growth, along the lines that have been suggested.

Rona Mackay.

Oh, I thought that it was Rachael Hamilton’s—

Do you not want to ask a supplementary question?

Yes I do. I beg your pardon. Despite the Tories’ claims, it appears that theirs is the only party that is obsessed with independence—

I am sorry, my supplementary is to a different question. That is why I was confused about being called.

Okay. We will move on to question 2.

Scottish Chambers of Commerce (Meetings)

To ask the Scottish Government what was discussed at the last meeting between the finance secretary and the Scottish Chambers of Commerce. (S5O-00460)

Ministers regularly meet the Scottish Chambers of Commerce to discuss a wide range of issues as part of our commitment to continue to work with businesses and business organisations to build a fairer and more prosperous Scotland. I last met the Scottish Chambers of Commerce on 1 December, as a guest at its annual event.

The First Minister, who was also in attendance, announced that the Scottish Government will provide up to £400,000 to the Scottish Chambers of Commerce to support new business-led trade missions and forge new trading alliances between chambers here and abroad. That will boost the resource that is already committed by the chambers network, complement the work of Scottish Development International and contribute to our shared efforts to increase exports and internationalisation.

In my area of the north-east of Scotland we have energy innovation and technology that have the potential to be exported worldwide. How important is the international grant that the minister mentioned in terms of helping businesses to export, particularly in the light of Brexit?

I know that the Scottish Chambers of Commerce certainly appreciated that grant, which will support its work on internationalisation and on building stronger networks, and will help in striking deals that will export our produce and innovation and improve our productivity. That is clearly aligned to our trade and investment strategies to support manufacturing and the low-carbon sector and to encourage companies to export. The partnership between the Scottish Government and the Scottish Chambers of Commerce is a worthwhile one that will complement the work of Scottish Development International.

A more international outlook for exporting is welcome. Although we have seen an expansion of hubs to encourage exporting, they are in Europe and not the rest of the world. Can the cabinet secretary tell me when the investment in hubs in Europe will be matched by investment in hubs in emerging markets around the world?

Jackie Baillie makes a fair point when she suggests that our work in internationalisation must reach beyond Europe. However, Europe is a very important market and our overall strategy on trade and investment in internationalisation can cover every part of the world, including the emerging markets. There will be increased focus on growth opportunities, wherever they exist. However, the Scottish Chambers of Commerce certainly appreciates the support that we have given it, along the lines that I mentioned, to support our international efforts.

In September, organisations including the Confederation of British Industry Scotland, the Scotch Whisky Association and the Institute of Directors wrote to the finance secretary to ask him to reverse the decision to double the rate of the large business supplement in Scotland, which will affect one out of every eight commercial properties and add a further £6 million to those businesses’ rates bills in the current year. Who is right: business groups or the Scottish National Party?

I look forward to presenting the Scottish budget tomorrow, and I look forward to on-going engagement with the business community. Following receipt of that letter, I met business organisations and said that I would consider their propositions. I look forward to announcing a package of measures that will support the business community when I outline the budget to Scotland tomorrow.

Ayrshire (Budget)

To ask the Scottish Government what impact its forthcoming budget will have on Ayrshire. (S5O-00461)

As I said in an earlier answer, tomorrow I will bring forward my tax and spending proposals. The people of Ayrshire and, indeed, people across Scotland will benefit from our commitments to expand early learning and childcare, raise standards in schools and close the attainment gap, protect the police budget in real terms and increase the health budget.

The draft budget will also progress our ambitious infrastructure investment programme, which we set out in the programme for government, including significant investments in affordable housing, digital, energy efficiency, transport and health. That programme also includes further progress on the A737 Dalry bypass and continued support for Glasgow Prestwick airport.

I thank the cabinet secretary for that positive answer. He will be aware how vital the Ayrshire growth deal is to Ayrshire’s future prosperity. That deal involves much-needed improvements to our infrastructure and investment of more than £350 million.

Although I am delighted that the Scottish National Party Government has already agreed to work with all parties concerned, does the cabinet secretary agree that the Chancellor of the Exchequer’s autumn statement was a missed opportunity to propose a matching commitment from Westminster? As supporting the Ayrshire growth deal will be good not only for Ayrshire, but for the Scottish and United Kingdom economies, will the SNP Government lobby the chancellor to reconsider, to share our vision and to back the Ayrshire growth deal in next year’s spring budget?

I believe that that was an omission on the part of the UK Government. We will continue to pursue the issue with the UK Government and the Cabinet Secretary for Economy, Jobs and Fair Work will support us in taking those steps to support the Ayrshire growth deal.

The cabinet secretary is well aware that the proposed Ayrshire growth deal is dependent on more than one budget, as has been outlined by Kenneth Gibson. Does the cabinet secretary agree that expanding the existing—but now full—enterprise zones in Prestwick and Irvine, and perhaps creating a new one in East Ayrshire, are strategically important to jobs creation and business development across Ayrshire? Will that be a priority in his budget tomorrow or—if not—in his next budget?

John Scott has made a valid point about a package of measures that can be involved in any growth deal—a package of levers to support economic growth. With that package of measures on infrastructure support, business rates and other areas, I am sure that Mr Scott will welcome my budget when I present it to Parliament tomorrow.

The Scottish Government’s own figures show that, since 2007, 800 jobs have been axed at East Ayrshire Council, 600 at North Ayrshire Council and 800 at South Ayrshire Council. That is 2,200 job cuts on this Government’s watch. The cabinet secretary refuses to use Parliament’s powers to stop cuts to local councils, so can he tell Parliament how many more jobs will have to be axed in Ayrshire as a result of his forthcoming budget? Does he think that those job cuts will be a price worth paying for families in Ayrshire?

Colin Smyth’s position on the use of powers is not accurate, and I do not support the proposition that is being put. I simply ask the member to reflect on the fact—which is understood by the independent Audit Scotland—that local government has, essentially, had a reduction to its budget that is equivalent to that which the Scottish Government has had. Local government has had fair and reasonable settlements from the Scottish Government.

Chancellor of the Exchequer (Meetings)

To ask the Scottish Government what was discussed at the recent meeting between the finance secretary and the chancellor. (S5O-00462)

The First Minister and I met the Chancellor of the Exchequer on 1 December and discussed a range of issues, including the economic and fiscal uncertainty resulting from the European Union referendum and the need for the United Kingdom Government to do more to support the oil and gas sector to secure its long-term sustainability. We also discussed the iniquitous treatment of the Scottish Police Authority and the Scottish Fire and Rescue Service with respect to VAT. That is an unacceptable situation that is estimated to cost the bodies about £30 million per annum.

Following the meeting, the chancellor committed to providing further details of his plans to adjust the UK budget and autumn statement timetable. Those details will be of significant interest to the joint working group that has been established to look into the Scottish budget timetable following the passage of the Scotland Act 2016.

Will the cabinet secretary outline what progress was made at that meeting on introducing changes to VAT legislation under the Finance Act 2016 to enable our Scottish emergency services to recover VAT?

The chancellor said that he will consider the matter further. I hope that, when he does so, he will realise that the situation is unfair, in that Police Scotland is the only police authority in the UK that cannot recover VAT. I do not know why the Labour Party supports the Tories on the matter, but I welcome the fact that the Tory party, through its chancellor, may well reconsider its position. That would be a welcome and fair move if it ensured that we could reclaim our VAT, which would be right for Scotland.

Were the finance secretary and his colleagues not well warned, in advance of the creation of a centralised single police force, that VAT would be irrecoverable, but they went ahead nonetheless?

The excuse that the UK Government uses is that the money is not coming through local government resources, yet the UK Government has made a range of amendments to its agencies to ensure that they escape VAT. That does not seem to apply to Scotland, however. Why the unfairness? The Tories can fix it in Westminster and ensure that we in Scotland get parity for our valuable emergency services.

When the finance secretary met the chancellor, did he discuss public infrastructure funding? Today The Guardian newspaper and The Ferret online have exposed how the Scottish Government’s failure to interpret EU rules correctly will result in £932 million being lost to public investment. At the same time, private financiers are profiteering from the taxpayer via sky-high interest charges at a time when interest charges across the western world are at a historic low.

Is it not abundantly clear that the non-profit-distributing model is just another financial scam and that the only people who think that it is a good idea are members of the Scottish Futures Trust and people around them, who will make fortunes out of schemes? Will the cabinet secretary join me in calling for a committee of the Parliament to investigate the whole issue of NPD financing of our public services?

Members would never know from that question that the Labour Party in office totally supported the public-private partnership model—that started under the Conservatives as the private finance initiative, which was the worst regime possible. Our model is much better at profit capping and we have been able to accelerate capital infrastructure investment to build schools, hospitals and community facilities and undertake other infrastructure projects, which have been welcomed across Scotland. We have been, and will continue to be, perfectly transparent about how those projects are delivered.

I will say more about infrastructure in tomorrow’s budget statement. We will make wise decisions on our capital spending and infrastructure projects, but we continue to pay for the legacy of borrowing and profiteering that we inherited from first the Conservatives and then the Labour Party.

Has the cabinet secretary received any communication from the Chancellor of the Exchequer about his three specific asks for the oil and gas industry? Those asks—improved access to decommissioning tax relief, urgent clarity on the use of loan guarantees and measures to stimulate exploration—were completely ignored in the autumn statement.

It is the case that the chancellor ignored those requests. I reinforced those points when I met him, and I will continue to do so, because those issues are important to the wider Scottish economy and to the north-east specifically. Perhaps he will revisit his position in the spring budget.

Constitutional Stability

To ask the Scottish Government what action it is taking to ensure that there is constitutional stability. (S5O-00463)

That was asked without a shred of self-awareness.

Membership of the European Union is fundamental to the structure of the devolution settlement in Scotland, so the United Kingdom vote to leave the EU has profound implications for our current constitutional arrangements. That uncertainty is compounded by the UK Government’s apparent intention to pursue a hard Brexit and take the UK and Scotland out of the single market.

The Scottish Government is clear that Scotland’s future constitutional arrangements must reflect the views and choices of the people of Scotland, who voted clearly to maintain our relationship with the EU. The Scottish Government will therefore shortly publish proposals to achieve that end and enable further devolution to this Parliament to protect the interests of the people of Scotland on the UK leaving the EU.

The former First Minister Alex Salmond said:

“a constitutional crisis ... might be an extremely good thing for Scotland”.

Mr Salmond seems to seek to encourage a constitutional crisis to block Brexit—which, as Alex Neil has pointed out, many Scottish National Party voters, including him, support—and to link Brexit with a second independence referendum as a formality. When will the Scottish Government start listening to Scottish voters and acknowledge that Scottish independence is not wanted?

The Tories are obsessed not only with Scottish independence but with the two Alexes. The ball is in the UK Government’s court. We will put forward proposals that reflect the democratic interests of the people of Scotland, who voted to remain in the European Union, while respecting and listening to them.

If the UK Government focuses on one thing and nothing else, it should surely be the single market, which the Tories once believed in. We will put forward a proposition, and the ball is in the UK Government’s court for it to respond positively. I hope for the sake of a number of matters, including constitutional certainty, that the Tories will take the proposal seriously and help us to provide further stability, which is what is required at this time.

Scottish Futures Trust (Edinburgh Schools)

To ask the Scottish Government what discussions it has had with the Scottish Futures Trust regarding school rebuilding in Edinburgh. (S5O-00464)

Government officials meet the Scottish Futures Trust regularly to manage the delivery of the schools for the future programme, which includes four new school projects in Edinburgh. Through the programme, the Scottish Government is providing significant investment of £62.6 million to the City of Edinburgh Council, which is the programme’s third-largest beneficiary.

I hope that conversations continue between the City of Edinburgh Council, the Scottish Futures Trust and the Scottish Government to ensure that the wave 4 schools, such as Liberton high school in my constituency, are rebuilt. However, the revelation in The Guardian today that the non-profit-distributing model is to be investigated by auditors will not only be awkward but certainly give parents and teachers no confidence that the money is on its way. What impact will that have on projects such as Liberton high school and others across Scotland?

Liberton high school is a sensitive matter and we should all reflect on that. On the more general political point about school building at the hands of the Scottish Government, I note that 651 school building projects have been completed during the past nine years, between 2007-08 and 2015-16. That is almost double the 328 schools that were completed over the preceding eight years. The Government has invested substantially in the school building and refurbishment programme and will continue to do that in dialogue with local government across Scotland.

Employment Barriers (Disabled People)

To ask the Scottish Government what actions it is taking to remove the barriers to employment for disabled people. (S5O-00469)

In “A Fairer Scotland for Disabled People—Our Delivery Plan to 2021 for the United Nations Convention on the Rights of Persons with Disabilities”, which was published on 2 December, we announced a range of actions to support disabled people into work, including the long-term ambition of setting a target for reducing the employment gap between disabled and non-disabled people in both the private and public sectors, and the use of new powers over employability to support disabled people into employment. Our transitional service from April 2017, through work for Scotland, will allow us to take a fairer approach to that support and help for 3,300 disabled people, and to offer a commitment, effective immediately, for modern apprenticeships to include the highest level of funding for disabled young people up to the age of 30, and to build on the Scottish Council for Voluntary Organisations and Inclusion Scotland’s pilot programme to provide disabled people with 120 employment opportunities in the third and public sectors and in politics between 2017 and 2021.

Does the minister agree that supporting disabled people into work not only helps them as individuals but benefits the whole economy and the businesses themselves, and that that stands in sharp contrast to the treatment of disabled people by the United Kingdom Government, which has been described by a United Nations committee as systematically violating their rights?

I absolutely agree with the fundamental point that Willie Coffey makes about us missing out on much talent by not ensuring that more disabled people are involved in the labour market. We are missing out on their ingenuity, creativity and innovation, and clearly greater participation would be good not only for the health and wellbeing of such individuals but for employers and for the economy overall.

On Willie Coffey’s latter point about the different approach that we might be able to take here in Scotland, we have set out clearly that the approach that we will take with our devolved employment programme will be different from what we have seen at the hands of the UK Government, and I have already mentioned the range of actions that we are taking to improve the participation of disabled people in the labour market.

In Scotland, the statistics on disability and employment vary substantially across the country. In the Shetland Islands, the disability employment rate is nearly 88 per cent, but in Glasgow it is less than 25 per cent. What action will the Scottish Government take to address those vast differences?

I have already set out a clear direction of travel for our ambitions, which we will continue to pursue. I will tell members what we would not have done, though. It is telling that Annie Wells pointed out the significant proportion of those who are disabled and unemployed in Glasgow, the city that she represents—if we had control of Jobcentre Plus, we would not be shutting down eight jobcentres in that city right now.

On that specific matter, I met representatives of the Public and Commercial Services Union on Monday, along with MP colleagues. They told me that they are particularly worried about the future for employment and support allowance claimants at jobcentres if eight jobcentres close in Glasgow, including in my constituency of Glasgow Maryhill and Springburn, where the jobcentre in Maryhill Road is threatened with closure. The Department for Work and Pensions told the PCS that forcing vulnerable constituents with mobility issues to travel longer distances would be an incentive into work. That is just crazy. Will the Scottish Government support the calls that have been made to halt that process and to ask for a fundamental rethink by the DWP?

I know that that is an important issue for Bob Doris, given his constituency interest, and that it is of interest to all Glasgow representatives. I have made contact with Damian Green, the Secretary of State for Work and Pensions, and have been keeping the MPs and MSPs who represent Glasgow up to date about that correspondence.

On Bob Doris’s point that the DWP has suggested that the changes will act as an incentive for people to get into work, that tells us more about the DWP’s attitude to human beings than it does about anything else. I absolutely agree with Bob Doris about the impact on service users, and I met the PCS earlier today to discuss that.

There is also an issue to do with the Scottish Government’s position. The Smith commission spoke about increased joint management between the Governments in relation to Jobcentre Plus but, in this matter, we had no prior notification, no meeting, no letter, no call and no email. Along with Angela Constance, I will meet Damian Green at the joint ministerial working group on welfare in January, when I will certainly raise that matter.

According to the Scottish Commission for Learning Disability, more than 50 per cent of adults with learning disabilities who are known to local authorities are unemployed. Can the minister say what the Scottish Government will do about that, rather than what it will not do, as he said in response to Annie Wells? Does the minister agree that the figure is just too high?

Yes, I agree that the figure is too high—I certainly concur with that point from Mr Johnson. Indeed, the wider unemployment rate for those with any disability in Scotland is too high, and we need to do rather better in that regard. I have already set out the actions that we propose to take as part of “A Fairer Scotland for Disabled People”. Right now, we have the open doors consortium, which provides specialist in-work support for a range of people, working with a range of organisations such as Action on Hearing Loss, the Scottish Association for Mental Health, the Royal National Institute of Blind People and—crucially in respect of those with learning disability—Enable. We are taking action and we will continue to take more. If Mr Johnson or any other member has innovative suggestions, we will always be happy to hear them.

UK Brexit Strategy (Economic Impact)

To ask the Scottish Government what analysis it has made of the impact on the Scottish economy of the United Kingdom Government’s Brexit strategy. (S5O-00470)

The UK Government’s Brexit strategy—I use the word “strategy” in its loosest possible sense—has to date increased the chances of a so-called hard Brexit. Scottish Government analysis that was published on 23 August, drawing on a research base from a range of external organisations, suggests that, under a hard Brexit, Scottish gross domestic product could be up to £11.2 billion per year lower by 2030 than it would be if Brexit did not occur. Such an adverse shock to our economic performance would reduce earnings, employment and tax revenues, which would in turn reduce the funding that is available for public services.

The cabinet secretary will no doubt agree with me that the Tory Government in Westminster currently has no strategy for Brexit. However, seeing as this is the festive season, there is hope that there could be a Christmas miracle. Would it not be good for the Scottish economy if the Westminster Government provided at least one idea of its strategy?

Mr Adam makes a good point. We can see the hardening of attitudes among the other 27 members of the European Union and the effects of the UK Government not putting forward any proposals. The economic evidence is clear that a hard Brexit that takes us outside the single market is the biggest threat to the economic prosperity of Scotland, including Paisley, and all of the UK. Despite repeated calls from the Scottish Government, the UK Government has yet to provide any transparency over its Brexit strategy, which is creating uncertainty for businesses across the country. For our part, the Scottish Government is clear that remaining in the single market is the best option for Scotland and for the UK as a whole. As such, we will shortly present our proposition, which will be focused on keeping us in the single market.

What specific actions is the Scottish Government taking to capitalise on the opportunities arising from Brexit? How much money has been provided to Scottish business from the £500 million growth fund that was announced by the Scottish Government over three months ago?

Dean Lockhart can see from answers to parliamentary questions, if he cares to check them, the progress that we are making towards the establishment of the Scottish growth scheme. He will have seen announcements by the Scottish Government that we are increasing the representation of Scottish Development International in the coming months to ensure that we have a stronger representation throughout the EU, including through hubs in London, Dublin and Berlin. To respond in part to the point that Jackie Baillie made earlier, there have been ministerial visits to Abu Dhabi supporting up to 80 Scottish companies that are interested in oil and gas and other industries, and we have been talking to 100 chief executive officers in India. A substantial amount of work is being done.

Hardly a day goes by without one study or another showing that we expect to have increased costs and poorer employment prospects, investment prospects and confidence. People other than this Government are saying that they think that Brexit is very bad for Scotland and the UK. I wonder how long it can be before the Brexit deniers in the Conservative Party start to realise that they have moved well to the right of Margaret Thatcher and that, after having been toxic for 35 years, they are about to experience the prospect of being toxic for a very long period because of their hard-right attitudes and the economic self-harm that they are doing to Scotland and the UK.

Apprenticeship Accreditation (Employer Information)

To ask the Scottish Government what information it provides to employers regarding apprenticeship accreditation. (S5O-00471)

All Scottish Government funded modern apprenticeship frameworks must be approved by the modern apprenticeship group before they are made available for delivery. They are developed through strong consultation with employers and reflect sector needs as defined by employers. When frameworks are approved, it is communicated to employers via direct engagement with them, to the training provider network and to other sector bodies that are involved in their development. The information is also published on the Skills Development Scotland website.

The minister will know that certain careers that have two-year apprenticeships, such as tattoo artists, do not have apprenticeship accreditation. Will the Scottish Government look at accrediting such apprenticeships under the apprenticeship scheme?

We will always be willing to consider such matters. I reiterate that any modern apprenticeship framework must be approved by the modern apprenticeship group. I am aware that many employers deliver their own apprenticeships. If they want those apprenticeships to be approved and be part of our modern apprenticeship offer, they should engage with Skills Development Scotland. If Sandra White wants to pick up the specific point that she raises with me directly, I will be very happy to speak with her.

A recent Scottish Government consultation on the apprenticeship levy found industry support for using the extra funds to support reaching the target of 30,000 modern apprenticeships. A few weeks ago, I visited Score Group in Peterhead, which has the largest private modern apprenticeship scheme in Scotland, and it reiterated that point. Will the Scottish Government use 100 per cent of the apprenticeship levy funds from the United Kingdom Government to invest in apprenticeship? When will we hear about its proposed policy to ensure that funds are used for approved regional training providers, and not just colleges?

I am rather surprised that Liam Kerr raised the matter of the apprenticeship levy. I note that he is hiding at the back of the chamber; he must have been even a little ashamed to raise it. It was only a few weeks ago that we heard from the Conservatives that the levy was going to result in £300 million-worth of funding coming to the Scottish Government. We know that that is not the case; where is our additional £79 million? When the £221 million was announced, the UK Government failed to set out that it was largely replacing existing expenditure. It also failed to point out that it will cost the public sector some £73 million, which will reduce the Scottish Government’s spending leeway by some £30 million.

Liam Kerr is quite correct: we engaged in a consultation on how we respond to the introduction of the apprenticeship levy. That is rather more than the UK Government did when it introduced it in the first place. It spoke to no one who has the responsibility for delivering apprenticeship policy, including the Scottish Government, and it spoke to no one who will be paying the levy. When we take something forward, we do things rather differently.

Aberdeen City Region Deal

To ask the Scottish Government what progress is being made with the Aberdeen city region deal. (S5O-00472)

The Scottish Government, the United Kingdom Government and regional partners signed the Aberdeen city region deal on 21 November. The signing of the Aberdeen city region deal and the release of funding allow the deal to move on to the delivery stage and make proposals a reality. The Scottish Government has committed to investing up to £125 million over the next 10 years. The city region deal funding will support investment in innovation, internationalisation, digital connectivity and infrastructure across the region.

Two major infrastructure projects were named in the Aberdeen city region deal within my constituency of Angus North and Mearns: rail improvements at Usan and Montrose, and the Laurencekirk junction. Will the cabinet secretary provide an update and more detail on the options for rail improvements at Usan, given that it acts as a bottleneck and is restricting capacity in the north-east? Will he also outline and explain the processes to be followed leading up to the construction of the Laurencekirk junction? A number of constituents have contacted me with concerns about the earliest possible construction date being 2021. An explanation of the process would be very helpful.

I am happy to do so. However, I should say that the projects that Mairi Evans mentioned are not part of the city deal. The Scottish Government wanted them to be part of it, but the UK Government baulked at the size of the contribution that it would have to make to additional elements of the city deal. Those projects therefore stand outside the city deal but, as Mairi Evans rightly said, they were mentioned at the same time. That is a further £254 million in investment from the Scottish Government over and above the £250 million that we will jointly share with the UK Government.

Transport Scotland is taking forward design and development work for improvements to the A90 at Laurencekirk, with a preferred option expected to be identified in 2018, leading to publication of draft orders in 2019. Progress thereafter will of course depend on the level and nature of representations received in response to the published draft orders and, subject to no objections being received, it is estimated that the earliest construction could commence is 2021. I talked to Mairi Evans about this at the Rural Economy and Connectivity Committee this morning; I have undertaken to provide written accounts of what I have just said, and I am happy to do that.

The development of rail infrastructure options is on-going. They include consideration of opportunities to increase capacity on the single-track section between Montrose and Usan. Our focus, however, remains firmly on maximising the benefits for rail passengers in Aberdeen. The timescales for delivery remain in line with the previous commitments, with implementation from the next rail control period starting in 2019.

The cabinet secretary has outlined the benefits that will be delivered through that particular city region deal and we have seen similar benefits for Glasgow and Clyde, while Inverness and Highland are pursuing their own agenda. Can the cabinet secretary update members on the progress that is being made on an islands deal so that similar benefits can be reaped by Orkney, Shetland and the Western Isles?

Discussions have taken place but, in relation to city deals, we have to proceed with the partners that we anticipate will be part of those deals, which would, in this case, be the UK Government and island authorities.

As my colleague the Cabinet Secretary for Finance and the Constitution said earlier, I asked the UK Government through Lord Dunlop, who is the lead on city deals, to ensure that the Ayrshire growth deal was mentioned in the chancellor’s autumn statement. I was disappointed when it was not.

Liam McArthur will be aware that there is a timeline and sequence for the deals that have been discussed so far. The Stirling and Clackmannanshire deals were mentioned in the autumn statement, as well as the Edinburgh and Tay cities deals. Further discussions on deals will require all those parties to be involved. The Scottish Government has made it clear that we are willing to discuss city deals with anybody who has proposals.

These things will be best done by maintaining that partnership with the UK Government and, subject to a sign that it is interested in doing that, we will continue to work with it.

I know that Ayrshire was not the subject of Liam McArthur’s question but, because of the sequencing that I mentioned, it impacts on further discussions with the islands. If the UK Government starts to draw back from that, we will see what we can do through working jointly with the Ayrshire authorities.

Public Houses and Bars Sector Jobs

To ask the Scottish Government how many jobs are directly and indirectly linked to the pub sector. (S5O-00473)

According to the 2015 business register and employment survey, which was published on 28 September 2016, approximately 30,000 people are employed directly in the public houses and bars sector in Scotland, equating to approximately 20,000 full-time equivalent employees. Applying the food and beverage services employment multiplier from the latest published Scottish Government input-output tables, it is estimated that a further 2,400 FTE jobs, across full-time or part-time roles, are supported in the supply chain for the sector, producing an estimated total of 22,400 FTE direct and indirect jobs in the Scottish economy.

Reform of the tied pub sector is crucial to protecting jobs in the pub industry. Many in the sector, such as the Campaign for Real Ale and the Scottish Licensed Trade Association, have expressed serious concerns that the recently published Scottish Government study, which was commissioned by the previous minister, is of extremely limited value. They are concerned that the study featured only 25 pubs, only 10 of which were fully tied and none of which were free-of-tie, tenanted pubs.

The minister is aware that I propose to introduce a member’s bill on tied pubs. Does he agree that it would be wrong for the Government to rule out legislation in this area before a full and robust consultation has taken place? Will he agree to meet me to discuss the issue of pub sector reform?

I recognise the importance of the study and the evidence base to be established in deciding future policy.

The independent study that Neil Bibby refers to by CGA Strategy, into the pub sector, was published on 6 December this year on the Scottish Government website. We are planning to engage with pub sector interests to discuss the findings of the research and how we can work together to create a more successful sector.

It is worth stressing that we have not yet come to a view on the issue. That is why, following the findings of the research, I intend to meet a wide range of stakeholder interests to take their views. I would be very happy to meet Mr Bibby to hear his points on the research.

I also stress that the Scottish Government is still open to taking empirical research and evidence where that can be provided to help inform the discussions on the issue.