Chamber and committees

Independent expert legal advice was received confirming that the proposed funding facility to Business Stream complies with relevant legal and regulatory duties, including applicable EU State aid and EU/UK competition laws. Any funding facility is consistent with the Market Economy Investor Principle (“MEIP”) test.

No funding has been made available to date. No funding is expected to be required during 2020-21. The funding arrangements have been put in place based on forecasts of the potential future impact of Covid-19 on Business Stream’s financial situation.

This is a matter for the Water Industry Commission for Scotland, and I have asked them to respond directly in writing to your question.

The Scottish Government is ensuring that a wide range of employability support is available to all those who need it during the Covid-19 pandemic.

The No-One Left Behind approach ensures that quality support based on individual need continues to be available across Scotland during this very challenging period. We are building on the £33 million already invested by the Scottish Government to support existing employability support services, including Community Jobs Scotland, Employability Fund and Fair Start Scotland, by investing a further £100 million to tackle unemployment and address retraining needs. This includes £60 million to support the new Young Person's Guarantee (YPG). The YPG aims to ensure every young person in Scotland, aged between 16 and 24 years, has the opportunity, based on their own personal circumstances and ambitions, of going to university or college, joining an apprenticeship programme, undertaking training or fair employment including work experience, or participating in a formal volunteering programme.

Under the Young Person's Guarantee, £30 million is being provided to Local Authorities to deliver enhanced employability support locally to young people across Scotland, ensuring one-to-one flexible support and training is available that will help young people to improve their future employability prospects. A significant part of the YPG funding will be for 'in-work' training, supporting SMEs and third sector employers to create more jobs, including pathways to apprenticeships. Other priorities include providing mental health support for young people and improving the availability of formal volunteering opportunities.

The National Transition Training Fund will support those aged 25 or over whose jobs are at risk as a result of the pandemic or have been made redundant, to access retraining. The first strand of the Fund, managed by Skills Development Scotland, was launched on 8 October. Individual Training Accounts (ITA), offer up to £200 to people of all ages who are unemployed or earn less than £22,000 who wish to upskill. ITAs reopened on 1 July this year, and remain open to applications.

We will continue to provide support for individuals affected by redundancy through our Partnership Action for Continuing Employment, PACE initiative. Through providing skills development and employability support, PACE aims to minimise the time individuals affected by redundancy are out of work. As announced in Programme for Government, we are investing an additional £5 million to scale up and enhance our support for those made redundant.

We have also provided additional funding of £2.35 million for our Parental Employability Support Fund which will provide intensive employability support for those most at risk of poverty, including disabled, young and minority ethnic parents to help them access or progress in work. This brings in year investment to £7.35 million.

All individuals can access careers information and guidance support from Skills Development Scotland through Scotland’s careers website: My World of Work , and a dedicated helpline: 0800 917 8000. Skills Development Scotland has also set up a dedicated Employment Online resource for advice on redundancy, employment, online learning, immediately available jobs, and wider support services: link

In terms of support specifically for graduates, Scottish Government is working with organisations in the FE and HE sector, including the Scottish Funding Council (SFC), Colleges Scotland and Universities Scotland on how to support increased graduate recruitment, internships and upskilling, by building on previous graduate employability models such as ‘Adopt-an-Intern’ and ‘Scotgrad’. Graduates can also access a range of services through their university Careers Office, with most universities providing support to graduates for at least a year following graduation. The October issue of the AGCAS journal, Phoenix, also provides some important advice for students and graduates and can be accessed via the following link: Responding to Covid-19

Scottish Water set out in their 2020 Delivery Plan update that they expected the outturn cash level to be within a range of £120 million to £200 million on conclusion of the SR15 investment delivery. During 2020 their costs and revenues have been significantly impacted by Covid-19 both in the day to day operations and in their investment programme. Scottish Water will provide an update on the forecast costs of Covid-19 and the impact on cash balances on the conclusion of the SR15 regulatory period in their 2021 Delivery Plan which will be published in March. This compares to the 2015-21 final determination assumption of a closing cash balance of £40m.

Any loan provided to Business Stream will be made by Scottish Water Business Stream Holdings (SWBSH) on arms-length commercial terms, consistent with the Market Economy Investor Principle (“MEIP”) test, based on independent expert advice and benchmarking. The key terms of the loan facility are:

• New funding of £59m - £10m of equity, first tranche £24m debt, and second tranche £25m debt.
• The first tranche debt will attract an interest cost of SONIA (Sterling Overnight Index Average) +3%
• The second tranche debt will attract an interest cost of SONIA +9%
• First tranche debt would be provided before second tranche debt.
• All debt is to be repaid within 5 years. The debt is secured by a floating charge over the assets of Business Stream, granted in favour of the lender.

The Commission’s functions are detailed in the Water Industry (Scotland) Act 2002, as amended by the Water Services etc. (Scotland) Act 2005.

The figures are in the following table.

This is a matter for the Water Industry Commission for Scotland, and I have asked them to respond directly in writing to your question.

This is a matter for the Water Industry Commission for Scotland, and I have asked them to respond directly in writing to your question.