Chamber and committees

(i)Population: The General Register Office for Scotland (GROS) supply any data requested by ONS for inclusion inUKfigures for Eurostat, within any timescale specified. Population data for Scotlandare produced on a different basis and by different statistical systems to thosefor England and Wales. Consequent methodological issues delayed the availabilityof a consistent UK-wide data set to Eurostat. Data for Scotland could not thereforebe used by Eurostat in time for the publication of the Yearbook. Steps are beingtaken to ensure better liaison between ONS and GROS and to find appropriate methodsfor producing data that is required by Eurostat on a consistent UK-wide basis.

(ii) Employment in Research andDevelopment. Data have been made available for the whole of the UK to Eurostatin time for publication. ONS are investigating why it was not included.

(iii) ICT patent applications.Eurostat calculated the figures for Scotland usingan automatic conversion from town/postcodes to NUTS regions. For some regions, theresults were very small or even next to zero, and therefore considered as not beingsignificant. Hence some English regions were also marked as data not available.Eurostat plan that the dissemination of very small figures (0.0012 or 0.0128) will,however, be improved later this year.

(iv) Biotechnology patent applicationsper million inhabitants. As the required population data were not availableto Eurostat in time for inclusion in the Yearbook (see (i) above), it was not possibleto provide derived indicators per head of population.

(v) Mortality through heart disease- male/female ratio aged 0 to 64. As the required population data were notavailable to Eurostat in time for inclusion in the Yearbook (see (i) above), itwas not possible to provide derived indicators per head of population.

(vi) Mortality through accidents– for men and for women aged 0 to 64. As the required population data werenot available to Eurostat in time for inclusion in the Yearbook (see (i) above),it was not possible to provide derived indicators per head of population.

(vii) Dentists per 100,000 inhabitants.Notwithstanding the problem with populations (see (i) above), area data on dentistswere not readily available in a format compatible with the EU’s official (NUTS)statistical geography.

Scottish Enterprise receivedprior approval to access and utilise £20 million of its reserves in 2006-07.The Executive agreed to provide an equivalent additional amount of resourcecover to enable this to happen. Details of how the additional resources weremade available are provided in my letter to Sir John Ward on 11 May (Bib. number39557).

All answers to written parliamentaryquestions are available on the Parliament’s website, the search facility forwhich can be found at:

“A Member State may concludepublic service contracts with or impose public service obligations as a conditionfor the provision of cabotage services, on shipping companies participating in regularservices to, from and between islands.”

This very clearly states thatpublic service obligations and public service contracts are alternatives. Article4.2 of the Regulation says:

“In imposing public service obligations,Member States shall be limited to requirements concerning ports to be served, regularity,continuity, frequency, capacity to provide the service, rates to be charged andmanning of the vessel”

Article 2.3 of the Regulationrecords that:

“A public service contract maycover notably:

- transport services satisfyingfixed standards of continuity, regularity, capacity and quality,

- additional transport services,

- transport services at specifiedrates and subject to specified conditions, in particular for certain categoriesof passengers or on certain routes’

- adjustments of services toactual requirements.”

From this, It is evident thata public service contract allows a wider range of factors to be specified, includingthe critical factor of quality, than a public service obligation. This is made veryclear in the Communication on the interpretation of the Maritime Cabotage Regulationpublished by the European Commission in December 2003. Section 5.3.1 of this documentsays:

“Article 4.2 of the Regulationsets out an exhaustive list of requirements that may be introduced when “publicservice obligations” are imposed. Article 2.3 of the Regulation provides only anindication of the scope of public service contracts; Member States may go further.In practice, quality requirements are often part of ‘public service contracts’,but cannot be introduced as part of ‘public service obligations’.”

The Executive wishes to ensurea high quality service, including the binding of operators to the vessels that havebeen purpose-built for the Clyde and Hebrides services, and this is only possible through a publicservice contract.

There is scope for confusion,given the different senses in which the word “obligation” can be used. The wordcan refer to the instrument or regulation used to impose the limited range of requirementspermissible under a “public service obligation”. However, it can also refer to thepublic service duties and responsibilities that are imposed on a contractor by meansof a “public service contract”. Any contract imposes obligations on the contractorand in the case of a “public service contract” these are public service obligations.This point is illustrated well in a recent Answer given by the European TransportCommissioner in response to a Written Question (P-3802/06) on the subject. The answerreads:

“Council Regulation (EEC) No3577/92 of 7 December 1992 applying the principle of freedom to provide servicesto maritime transport within Member States (maritime cabotage) allows Member Statesto impose public service obligations on all operators on a given route to ensuresufficient service on that route where it appears that, if they considered theirown commercial interest, operators would not propose an adequate level of services.These obligations may be imposed by regulation or, if this does not suffice to meetessential transport needs in an adequate manner, laid down by way of public servicecontracts. If necessary, financial compensation may be granted to operators to coverthe costs involved in meeting public service obligations.

The imposition of public serviceobligations is therefore a precondition for any compensation being given.

Such compensation does not constituteState aid if complies with the criteria laid down by the Court of Justice in itsjudgment in Altmark.”

The key sentence is “These obligationsmay be imposed by regulation or, if this does not suffice to meet essential transportneeds in an adequate manner, laid down by way of public service contracts.” Thisclearly maintains the principle that imposing obligations by way of regulation (ieproceeding via a Public Service Obligation) and laying the obligations down by wayof public service contracts are alternative, not complementary, routes. In the caseof the Clyde and Hebrides ferry services, the obligations that the contractor willbe expected to accept will be set out in the service specification for the tenderand will be embodied in the contract that is ultimately signed with the selectedoperator.

There is, therefore no questionof two documents or instruments - a Public Service Obligation, imposed by regulation,and a Public Service Contract - being required before subsidy can be offered. Aswith any contract, the obligations can be set out in the contract itself.

Later publication providesministers with the time to explore carefully the options in the report.

The report will be as part of the background information that informed our decisions when we announce the outcomeof the spending review in September 2007. We will respond to any feedback at thattime.

Later publication providesministers with the time to explore carefully the options in the report - early disclosurecould increase pressure to rule in or out options without consideration.