Meeting of the Parliament

Meeting date: Tuesday, October 4, 2016

Official Report 915KB pdf

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Topical Question Time

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Common Agricultural Policy Loan Scheme

To ask the Scottish Government whether it will provide an update on progress that it has made in delivering the national common agricultural policy loan scheme. (S5T-00117)

I announced the national basic payment support scheme for 2016 to Parliament on 13 September, and delivery has proceeded on the timescale that was set out in that announcement.

Letters inviting farmers and crofters to apply for loans were issued dated 27 September, and everyone who is eligible to apply for a loan should receive their letter this week.

I regret that after letters were sent, manual checking of a sample of the calculations uncovered an undervaluation of entitlement that affected some potential applicants. Clearly, that is regrettable and I appreciate fully that it will have caused confusion for people receiving letters. Revised loan letters will be issued to the affected farmers and crofters this week. However, it is important to note that no farmer or crofter who is entitled to receive a loan will be worse off as a result of that undervaluation. Indeed, every single farmer or crofter who is affected will be entitled to receive more than they were originally notified of.

I thank the cabinet secretary for his explanation and assurance about what are clearly difficult circumstances. Can he advise when all payments can be expected to be made under the scheme after the closure of applications in about two weeks?

I can advise that our aim was that the bulk of the payments should be made in the first fortnight of November, and that is still our intention. I would not use the term “closure” because we have asked farmers to return the form by 12 October, and those who are affected by the adjustment following the undervaluation will be given a further week to do that. However, there is no cut-off period; no one is excluded if they do not meet the deadlines. In other words, those who miss the deadlines will still receive a loan payment but might not receive it at the same time as everyone whose forms are returned timeously.

I am sure that the flexibility that the Government is showing will be very welcome. The cabinet secretary said in a statement to Parliament that a small number of businesses will not qualify for a loan. How many might be involved, why might they not receive loans and what help might be forthcoming for them?

A relatively small minority of businesses will not receive loan offers at this stage because of the complexity of their cases. There is a variety of cases in that category, and we are absolutely determined to work through all of them. As the validity of each case is resolved and where eligibility is established, loan offers will be issued case by case.

I remind members of my farming interests, which are noted in the members’ register of interests.

The shambles continues. To be frank, you could hardly make it up. However, my question is this: can the cabinet secretary explain why only an estimated 17,000 farmers are to be offered loans under the scheme, rather than the 18,300 businesses that are eligible for CAP payments? Are those the same businesses that are still awaiting substantial sums of money from the 2015 scheme? In other words, are they facing a double whammy?

We expect to issue loan offers to more than 17,000 businesses, so I do not agree with that part of the Peter Chapman’s contention. I will be able to provide more details in the time that will be available tomorrow, when there will be a statement in the chamber on the matter. However, I respectfully point out to the member that I believe that the loan scheme that I announced has been broadly welcomed—apart from by the Conservative Party and the Liberal Democrats—by the National Farmers Union Scotland and certainly by individual farmers and crofters to whom I have spoken. That is the case not least because the loan payments—which are, in most cases, 80 per cent of entitlement of basic payments—will be received considerably earlier than the money would have been received in normal years. That has the fortunate benefit that there will be a substantial injection into the rural economy of up to £300 million during the course of November. I am very pleased that that has been welcomed by the overwhelming majority of people, albeit that they are outwith this chamber.

The cabinet secretary said that the mistake was picked up during manual checking. Was it another fault in the new computer system?

As soon as I was alerted to the matter, I instructed that an internal investigation be conducted by an independent team—in other words, people who were not directly involved in the scheme’s administration. It is best to wait until the results of the investigation are known. I will certainly come back to Rhoda Grant and other members once the investigation has taken place. I intend to ensure that it is conducted with due expedition.

Last Thursday morning, Mr Ewing’s officials told the Public Audit Committee that farmers had nothing to worry about and that the system’s information technology problems were being fixed. By that afternoon, we knew that another shambles was in the offing, as hundreds of farmers were left in the dark over their loan applications. Why were the minister’s officials not more forthcoming when they came to Parliament’s Public Audit Committee last Thursday morning?

I do not accept Mr Rumbles’s assertions. First of all, he asserts that there was, necessarily, an IT problem. I just gave an answer a moment ago in which I said that the precise nature of why the mistake arose—[Interruption.] I am being barracked again by Mr Rumbles, as is normally the case. Let me repeat: a moment ago I said in answer to Rhoda Grant that we are quite appropriately carrying out an internal investigation into precisely what went wrong. I think it better to wait for the outcome of that, frankly, before one assumes—as Mr Rumbles did a moment ago—that it was necessarily related to an IT problem.

I am absolutely delighted—[Interruption.]. There Mr Rumbles goes again, Presiding Officer. I am absolutely delighted that my officials corrected the error, which they spotted almost immediately. No one—not one farmer and not one crofter—will lose a penny piece.

I am delighted that we have taken the step of responding to the situation by providing a national payment scheme, which will inject considerable amounts of money into the rural economy. I am also pleased that that policy seems to have the broad support of the farming community—if not of Mr Rumbles.

I declare an interest as a farmer. The cabinet secretary will be well aware of the growing clamour about the continuing failure of basic payments to be made for 2015, with approximately 700 recipients still waiting for their payments. Peter Chapman’s question about that group remains unanswered. Will the same group suffer twice from being excluded from payments?

The loan scheme for 80 per cent of the 2016 basic payment is welcome, but will the cabinet secretary tell us when the remaining 20 per cent is likely to be paid, to give certainty to cash-flow predictions of hard-pressed farmers?

That goes somewhat beyond the province of the original question—if I may say so, Presiding Officer—because it relates to the loan scheme. However, I am happy to say two things in response to John Scott’s question. First, I will provide more information about the matter tomorrow when we will have considerably more time to discuss the issue. Secondly, I assure Mr Scott that my officials are working extremely hard to make sure that the balance of the basic pillar 1 payments that are due to farmers is paid as quickly as possible.

As members are declaring their interests, I declare an interest as a taxpayer. The matter appears to be the latest in a long line of shambolic Scottish Government IT project fiascos. If the Government cannot sort out farm payments, what chance will we have when some of the benefits system is transferred to it?

On farm payments, how much taxpayers’ money has been poured down the drain?

The cost to the taxpayer of the mistake—which was corrected immediately—will be the cost of posting out the letters.

I declare an interest as a partner in a farm partnership. Will the cabinet secretary give us an idea how many letters were sent out, thereby telling us how many people were given the wrong information?

I have said that a relatively small minority of farmers were affected and that I will come back to Parliament with full details in the statement that I will—thanks to the Parliamentary Bureau—be able to make tomorrow.

Thank you, cabinet secretary. A motion to that effect will be moved later today. The motion will include a statement to be made at 2.40 tomorrow, for members’ interest.

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Clair Oil Platform

To ask the Scottish Government what environmental assessment it has made of the leak from the Clair oil platform, west of Shetland. (S5T-00102)

Marine Scotland has been working with the Maritime and Coastguard Agency, the Department for Business, Energy and Industrial Strategy, the Joint Nature Conservation Committee and the operator, BP, to assess the environmental impact of the leak from the Clair field. It is understood that the oil came from the produced-water system rather than from a leak from the well.

Initial aerial surveillance and modelling show that the oil is moving north-north-east from the platform. That presents a low risk to environmental sensitivities such as seabirds and sea bed features and has informed Marine Scotland’s advice that the most appropriate response is to allow the oil to disperse naturally. BP has been asked to carry out further modelling to allow a full environmental impact assessment to be undertaken. BP is also deploying a vessel to the area, which will take water samples. Marine Scotland will be passed the information for review.

Does the cabinet secretary accept the inherent risks of oil and gas extraction in the United Kingdom continental shelf, particularly west of Shetland, both to the offshore workforce, which it is important not to forget on these occasions, and to the marine environment? Will she ensure that BP and other operators guard against those risks through robust operational procedures and measures to minimise the impact of spillages at sea? Can she confirm that BP’s Clair field has operated since 2005 without any spill that we are aware of?

On the last point, I think that Tavish Scott is correct and that this is the first such incident since the Clair field began operations.

On the more general issue, all industrial activity has to have regard to the safety of its workforce and the environment—all that is taken into account on an on-going basis. In this particular set of circumstances, the environmental risk has been assessed as low. There is always the potential for such incidents to happen. However, we need to remember the importance of the oil and gas industry to the Scottish economy.

I remind members that the regulator for the oil and gas industry is the Department for Business, Energy and Industrial Strategy. The department is investigating and will carry out enforcement action if that is considered necessary.

Can I take it that BP’s environmental assessment has been shared with the Scottish Government? Does the cabinet secretary understand that it states that there is some risk of seabirds being oiled to the north-north-east? Finally, has the Government been informed as to why the spill occurred, and when does it hope to find out the details, to ensure that this does not happen again?

The member asked about three different areas. On when we will find out the details, when the Department for Business, Energy and Industrial Strategy finalises its review, the information should be shared with us.

Impact on the sea bed is not a current concern. The oil might sink to a depth of about 25m, but the sea bed in this area is at 140m, with the nearest marine protected area some 20km away, in water depths of between 300m and 600m. The advice about natural dispersal has been accepted as the best way to proceed at present, on the information that we have.

As I indicated in my first answer, BP has been asked to carry out further modelling. We are looking at the potential for a full environmental impact assessment to be undertaken. BP is deploying a vessel to the area, which is taking further water samples. That information will, of course, be passed to Marine Scotland in due course.

There are 571 platforms in the North Sea that, if removed via a single lift, would need to be floated past Scotland to decommissioning yards that are big enough to handle them in England or elsewhere, with the risk of causing environmental harm. What plans does the Scottish Government have to support a large-scale decommissioning port in Shetland or elsewhere to provide jobs and to realise the true value of decommissioning for Scotland as part of our journey to a more circular economy?

That is fairly broad so the minister might wish to give a short answer.

That is a little beyond my portfolio responsibilities. However, the Scottish Government is always on the lookout for potential further developments to help the economy of Scotland.

Environmental assessments are very important, as are marine protection areas, and I am concerned about a pattern of marine behaviour that places our oceans at risk. The BP spokesman said:

“The release was stopped within an hour”.

The Transocean Winner was carrying 280 tonnes of diesel when it ran aground off Lewis. Cromarty Firth Port Authority plans to transfer 8.4 million tonnes of oil between ships in the open seas of the Moray Firth. The cabinet secretary referred to the Marine Scotland report from February, which states:

“A further area of increased activity by Marine Scotland is the service provided for Ministers on emergency responses to maritime incidents.”

Does the cabinet secretary agree that the Scottish Government needs to be more robust at heading off emergencies, and that it can do that by formally objecting to the ship-to-ship transfer of oil in the open seas and by supporting robust action against reckless and negligent operators? If the Government does that—the cabinet secretary is shaking her head, but it is an important issue—it will protect not only the pod of orcas that swim between Iceland and the Moray Firth coast but wider marine life, our fishermen and our tourism industry.

Again, that was quite a broad follow-up question.

With the greatest of respect, Presiding Officer, it also ranged over a number of different areas that are not covered by Tavish Scott’s question. John Finnie’s initial comments related to the rig that ran aground on Lewis rather than to issues that relate directly to the incident off Shetland.

As I have indicated, the regulator of the oil and gas industry is the Westminster Department for Business, Energy and Industrial Strategy. Marine Scotland is a consultee in that process and the Scottish Government will continue to liaise with key stakeholders such as BP and any others that might be involved in incidents.

I reiterate that the oil and gas industry is extremely important to the Scottish economy. We rely on a mixed energy portfolio and oil and gas is an integral part of that. It is important that we maximise recovery from the North Sea, but we have to do that in a responsible and efficient manner. A successful sector is also important in helping us to transition to a low-carbon economy, in which the skills and capabilities that have been built up over decades will be critical.

There is a constant balance between what is required to ensure that the economic interest continues and what is required to minimise environmental incidents and ensure that they do not become such an issue that we begin to lose the economic benefit. Although the regulator is reserved, Marine Scotland is involved in the matter and we are, as always, involved in the discussions to ensure the best possible outcome.

My major concern is, obviously, the marine environment and I have been assured that this incident has minimal risk for the marine environment. It does not impact the sea bed, which is too far below the surface to be affected. The product of the produced-waters system is crude oil mixed with sea water; it is not a straightforward oil leak. The incident was a single event; it has not been a continuous leak. In terms of what might have happened, the result is at the absolute minimum, so we have been extremely lucky. However, part of the outcome of the investigation will be to inform future action and the decision on whether enforcement is required as a result.

How long will it take for the oil to disperse naturally, and will there be a risk to fish and sea mammals while that happens?

I am not advised of any such risk. I can try to establish whether there is any estimate of the time that it will take for the dispersal to occur. If it is possible to give that kind of estimate, I will ensure that the member receives the information. However, at this point, I do not know whether it is possible to make any prediction about how long it will take for dispersal to take place.