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Chamber and committees

Meeting date: Wednesday, December 13, 2017

Meeting of the Parliament 13 December 2017

Agenda: Portfolio Question Time, Finance, Business Motions, Parliamentary Bureau Motions, Decision Time, Heads Up for Harriers Project and the Role of Species Champions


Contents


Portfolio Question Time


Finance and the Constitution


The Constitution

1. Linda Fabiani (East Kilbride) (SNP)

To ask the Scottish Government when it will next meet the United Kingdom Government to discuss matters relating to the constitution. (S5O-01584)

The Minister for UK Negotiations on Scotland’s Place in Europe (Michael Russell)

Yesterday, I met UK Government ministers, along with my counterpart in the Welsh Government, Mark Drakeford, and civil servants from the Northern Ireland Executive, in the joint ministerial committee (European Union negotiations). The meeting focussed on UK frameworks, the European Union (Withdrawal) Bill, migration and the involvement of the devolved Administrations in stage 2 of the European Union negotiations. I made it clear that the constitutional future of Scotland and this Parliament is very much at stake in the process of EU withdrawal unless there are amendments to the withdrawal bill. I stressed that all the powers of this Parliament affected by withdrawal must stay devolved after Brexit. I also made it clear that if it is possible to create a special arrangement between Northern Ireland and the European Union, recognising the special difficulties and status of Northern Ireland, there is no logical reason why Scotland should not have the same rights. Indeed, it would be unacceptable for Scotland to be placed at any economic disadvantage.

Linda Fabiani

The next time that the minister meets his UK counterparts, following on from those discussions and yesterday’s debate, will he express the shock of many in Scotland at finding out that under the European Union (Withdrawal) Bill, the UK Government, along with Tory Scottish MPs who consistently refuse to safeguard Scotland’s interests, is refusing to safeguard Scotland’s devolution settlement and instead legislating for the right to amend the Scotland Act 1998?

Michael Russell

It was disappointing to see last week those Scottish Tory MPs refusing to support the Scottish Government and Welsh Government amendments with regard to clause 1, which were carefully thought through, and then to see last night a repeat of that situation in which amendment 158 was voted down. It was an amendment that would have made sure that UK ministers could not, by secondary legislation or by action—simply by the stroke of a pen—alter legislation passed by this Parliament. It is disappointing to see that. We have made it absolutely clear that we will not bring forward a legislative consent motion unless there are those amendments or equivalent amendments to the bill. That is the nub of the matter. There can be no legislative consent motion without those significant and lasting changes to the bill.

Adam Tomkins (Glasgow) (Con)

The newspaper The Herald reports on its front page that at yesterday’s JMC, there was in fact substantial agreement between the two Governments on the repatriation of powers from the European Union to this Parliament following Brexit. However, according to The Herald, rather than share that good news with the Scottish Parliament—and, indeed, with the Scottish people—the Scottish National Party would keep it under wraps. Why? Does that not just serve to underscore yet again that the SNP would rather contrive a grievance than get on with the job of delivering Brexit for Scotland?

Michael Russell

No, it does not. If Mr Tomkins had read the whole piece, he would have seen a significant statement from the Scottish Government that said “This is not true.” So, the “exclusive” tag on the story is for an exclusive untrue story. What is more concerning about the story is that it indicates that the Secretary of State for Scotland does not understand the process in which he is engaged, which is very concerning indeed. The process in which we are engaged is looking at the list of 111 intersections between European competence and devolved Scottish competence and making sure that those matters come to this Parliament. Then, of course—we have made it absolutely clear—we can sit down and talk about those matters that should be subject to joint frameworks and co-decision making.

Unless there has been a new declaration of intent from the UK Government, the issue is not about re-reserving powers that should be in this Parliament. However, if Mr Mundell’s briefing to The Herald is to be taken at face value, he believes that the actions that we are engaged in are about re-reserving powers and allowing the rest to come back here. That is the nub of the matter. If the Secretary of State for Scotland does not understand the discussion that we had yesterday afternoon, that bodes ill for getting a settlement. Fortunately, there are others round the table in the UK Government who do understand the discussion and are working to try to achieve that. I hope that that work will pay off, but I have to say that it is not helped by the Secretary of State for Scotland, who seems to think that his job is to brief The Herald rather than get a resolution.


Landfill Tax (Decreasing Revenues)

2. Bill Bowman (North East Scotland) (Con)

To ask the Scottish Government how it will compensate for decreasing levels of landfill tax revenues as the amount of waste to landfill decreases. (S5O-01585)

The Cabinet Secretary for Finance and the Constitution (Derek Mackay)

As landfill tax is an environmental tax that is designed to divert material from landfill, encourage alternative waste treatment options and keep valuable resources circulating in our economy for longer, I would see declining revenue as a positive trend. It is worth noting that the adjustment to the Scottish Government’s block grant relating to landfill tax is also forecast to fall, which means that, overall, falling revenues do not necessarily lead to less spending power.

Bill Bowman

Will Scottish rates for landfill tax continue to mirror United Kingdom rates or will they diverge?

Derek Mackay

As Mr Bowman and I were discussing over dinner last night—I do not know whether that does more damage to his reputation or mine—the block grant adjustment is very complex in nature. I hope that, across the UK and in Scotland, landfill tax revenues will go down, because that will be an indicator that we are making progress on our environmental ambitions, which will be good for the environment and the economy.


Local Authorities (Funding)

3. Ross Greer (West Scotland) (Green)

To ask the Scottish Government how it will ensure that sufficient funding is provided to local authorities to help them meet the needs of their residents. (S5O-01586)

The Cabinet Secretary for Finance and the Constitution (Derek Mackay)

The 2018-19 budget will continue to treat local government fairly, despite the cuts to the Scottish budget from the United Kingdom Government. It is then the responsibility of individual local authorities to manage their budgets and to allocate the total financial resources available to them on the basis of local needs and priorities.

Ross Greer

East Renfrewshire Council in my region is proposing in its coming budget to cut all classroom assistants in its primary and secondary schools and to significantly reduce the number of behavioural support assistants. I realise that, if I ask the cabinet secretary what will be in tomorrow’s budget, he will ask me to wait until tomorrow, but does he accept that, without a significant change in policy from the Scottish Government, it will become impossible for councils to avoid such cuts?

Derek Mackay

I have just glanced at the figures for East Dunbartonshire—

The Minister for Parliamentary Business (Joe FitzPatrick)

It is East Renfrewshire.

Derek Mackay

Yes—I have looked at that as well. That is how multitalented I am. I looked at East Dunbartonshire, thinking that Ross Greer would have an interest in it, and its increase was more than 4 per cent, whereas East Renfrewshire’s was more than 5 per cent. In every regard, both councils have done very well from our settlement to local government. Incidentally, both councils increased their council tax using their powers.

The member touched on education, which is important. The pupil equity funding and wider attainment funding have supported young people and pupils across the country and have resulted in more teachers being employed, which is addressing that crucial attainment gap. I reassure Ross Greer that the local government settlement that I will propose will be fair and reasonable. He answered his own question: full details will be released tomorrow.

John Mason (Glasgow Shettleston) (SNP)

Can the cabinet secretary confirm that allocation of funding to councils will continue to be based on need and that there will not be a kind of evening-out process that might disadvantage the islands and Glasgow and those with greater needs?

Derek Mackay

There is a very sophisticated needs-based formula for the local government settlement, which is arrived at in dialogue with local government and the Convention of Scottish Local Authorities. There is also the floor, which is another technical arrangement that allows for stability and a degree of convergence around funding. Fundamentally, the answer is yes—the funding settlement for local government continues to be needs based.

Alexander Stewart (Mid Scotland and Fife) (Con)

A recent Audit Scotland report confirmed that local government funding from the Scottish Government has fallen in real terms by 7.6 per cent since 2010-11, demonstrating that the Scottish Government has forced disproportionate cuts on local government. Can the cabinet secretary confirm that, since next year’s block grant will again increase in real terms, there is no further justification for cuts to local government by the Scottish National Party Government?

Derek Mackay

I do not know what is going on in the parallel universe that is Alexander Stewart’s mind or with the rest of the Tories and their briefing notes. The reality is that the resource funding for day-to-day spending for the Scottish Government is going down, by £200 million next year and £0.5 billion over two years. Members should not just take my word for it—the Fraser of Allander institute says so.

In the previous period, our budget went down by £2.6 billion—8 per cent in real terms—and, over that period, we have protected local government as best we can. South of the border, where the Conservatives have been in control, the real-terms reduction for local authorities in England has been more than 20 per cent, showing that we have treated local government in Scotland very fairly indeed.


Local Authorities (Funding)

4. Lewis Macdonald (North East Scotland) (Lab)

To ask the Scottish Government how it will ensure fair and adequate funding for all of Scotland’s local authorities. (S5O-01587)

The Cabinet Secretary for Finance and the Constitution (Derek Mackay)

The 2018-19 draft budget will continue to treat local government fairly, despite the cuts to the Scottish budget from the United Kingdom Government. Local government allocations are distributed using a needs-based formula, which is kept under constant review and agreed with the Convention of Scottish Local Authorities.

Lewis Macdonald

The cabinet secretary will recognise that the funding formula that he referred to has tended to disadvantage some councils, including Aberdeen City Council. Provision was made in the previous parliamentary session, through the funding floor that he referred to in his reply to John Mason, to reduce the disadvantage. Will he confirm today that that funding floor will continue? Will the council now achieve the target of 85 per cent of the Scottish average that was set for it some years ago?

Derek Mackay

Lewis Macdonald is right to say that there is a needs-based formula. There is also the ability for councils to raise council tax. On top of that, Aberdeen City Council has the 85 per cent floor which, incidentally, the Labour Party never gave to Aberdeen or North East Scotland when it was in power; it was established by the SNP Government. I am sure that Lewis Macdonald and many other members will welcome the local government settlement when they see it tomorrow.

Murdo Fraser (Mid Scotland and Fife) (Con)

Given that the Scottish Parliament information centre has confirmed that the Scottish Government budget is going up in real terms from this year to next and that, when the Fraser of Allander institute published yesterday the new Fraser of Allander Institute Economic Commentary that I am holding, it said—notwithstanding the cabinet secretary’s comments—that the total Scottish Government budget will go up in real terms over the next three years, does the cabinet secretary agree that there is no case for making any further real-terms cuts to local government spending?

The Deputy Presiding Officer (Christine Grahame)

I remind members, including Mr Fraser, that I do not like props.

Derek Mackay

That was an appropriate rebuke, I would say, Presiding Officer. The commentary that Murdo Fraser chose to use is one such prop. I do not know why Conservative members want to ignore and dismiss the advice of the Fraser of Allander institute. That discretionary spend is the resource for day-to-day public services that funds schools, hospitals, police, fire and front-line local government services? I know that Murdo Fraser is far more intelligent than he is pretending to be in the chamber this afternoon. Just as the rest of the Conservatives know, Murdo Fraser knows only too well that his party has cut discretionary funding to Scotland. That is the reality, but the Tory briefing note does not say so. Just like Pavlov’s dog, the Conservative members follow the merry tune that says that we have extra resources when, in fact, our resources for front-line discretionary spend will go down by £200 million next year and by £0.5 billion over two years.

The Deputy Presiding Officer

I remind members that the subject will be debated this afternoon, so we do not have to rehearse it all now.


Non-domestic Rates

5. Jeremy Balfour (Lothian) (Con)

To ask the Scottish Government, in the light of the UK Government’s decision to do so, whether it will bring forward the linking of non-domestic rates poundage to the consumer prices index from 2020 to April 2018. (S5O-01588)

The Cabinet Secretary for Finance and the Constitution (Derek Mackay)

That is a good question, and I will give Jeremy Balfour the answer tomorrow in the draft budget.

Jeremy Balfour

I thank the cabinet secretary for his very full answer. [Laughter.]

Does he agree that linking poundage to the CPI would result in rates being more than a penny lower in three years, thereby saving the average shop hundreds of pounds in tax? In an age of increasing competition from online retailers, does the cabinet secretary agree that we need to do all that we can to help our struggling high street shops?

Derek Mackay

I agree with the sentiment of the question. A number of businesses have made switching from the retail prices index to the CPI as the main ask for the budget tomorrow. The Barclay review also said that there is an argument for moving from RPI to CPI but, in Barclay’s view, that is unaffordable at this stage. I have been reflecting on that and many other matters, and will present my proposals to Parliament tomorrow.

Willie Coffey (Kilmarnock and Irvine Valley) (SNP)

What proportion of rateable properties do not pay rates as a result of the small business bonus scheme? Will the cabinet secretary confirm that the businesses that qualify for the scheme will continue to benefit from it next year?

Derek Mackay

As it stands today, about half of all properties in Scotland—40 per cent—pay no rates, which is a consequence of the small business bonus. I have said that that will continue.

Neil Findlay (Lothian) (Lab)

My understanding is that we are supposed to be in an era of evidence-led policy. When will the Cabinet Secretary for Finance and the Constitution have a proper independent analysis of the small business bonus?

Derek Mackay

I believe that the small business bonus has been a lifeline, especially for town centres in Scotland, by ensuring that smaller businesses have had financial relief in turbulent times. When I launched the last budget, with regard to non-domestic rates, the business that I visited in Paisley was using the relief to which it was entitled to employ a young person. Neil Findlay surely welcomes that kind of initiative, which has been delivered through the small business bonus.


Local Authorities (Draft Budget)

6. David Stewart (Highlands and Islands) (Lab)

To ask the Scottish Government what representations it has received from local authorities regarding the draft budget. (S5O-01589)

The Cabinet Secretary for Finance and the Constitution (Derek Mackay)

Ahead of my 2018-19 draft budget announcement, I have met a number of individual council leaders and have had a series of meetings with the Convention of Scottish Local Authorities.

David Stewart

Many local authorities in my region are facing severe financial pressures and unique rural and logistic demands. My local council, Highland Council, has responsibility for 6,752 kilometres of roads, 17,000 footpaths and 1,400 bridges, not counting the new Holm Mills bridge that was opened on Monday. Will the cabinet secretary look again at the Scottish Government’s funding formula and give more leeway to the rural local authorities, such as Highland Council, that cover great swathes of Scotland?

Derek Mackay

I would consider a change to the formula only if COSLA—local government, in other words—wanted me to. Should not that be welcomed by members who believe in partnership and engagement with local authorities? They determine the funding formula, which has partnership working in it, and I do not propose to change that.

If I did more for rural areas, urban councils would say that there was a deprivation argument; every council leader—32 out of 32—could present a case for how the formula could be changed to suit them. That is why we do it collectively and in partnership. I propose to maintain that structure.

Incidentally, if we look at the totality of resources to support local services, Highland Council enjoyed a real-terms increase in the current financial year.


Private Finance Initiatives and Public-Private Partnerships (Payments)

7. Kenneth Gibson (Cunninghame North) (SNP)

To ask the Scottish Government by how much PFI/PPP payments will increase in 2018-19, given that such payments and index-linked bonds include charges that increase with inflation. (S5O-01590)

The Cabinet Secretary for Finance and the Constitution (Derek Mackay)

The total estimated private finance initiative unitary charge payments for 2018-19 will increase by almost £19 million, which will take the total figure for that year to more than £1 billion.

Kenneth Gibson

Does the cabinet secretary agree that inflation exacerbates the year-on-year increases in charges, which shows the folly of Labour, Lib Dem and Tory support for PFI?

Derek Mackay

Yes. PFI is a burden that we have to live with and pay for, which is why the SNP Government’s financial models have been much better for the public purse and for the quality of public services.

Jackie Baillie (Dumbarton) (Lab)

Unitary charge payments apply to PFI/public-private partnership and to non-profit-distributing model projects that have been brought forward by the Scottish National Party Government. Last week, the Public Audit and Post-legislative Scrutiny Committee took evidence from the Scottish Government and the Scottish Futures Trust about changes to classification of capital projects as a result of “European system of accounts: ESA 2010”, and we now know that the Scottish Government has to borrow almost £1 billion to cover the projects that are on the balance sheet. Does the cabinet secretary share my concern that that is an opportunity lost and that other capital projects have been delayed as a consequence?

Derek Mackay

That is absolutely not true. I look forward to setting out an exciting, bold, ambitious and transformative capital investment programme tomorrow.


Departmental Spend (Outcomes)

8. Ivan McKee (Glasgow Provan) (SNP)

To ask the Scottish Government what it is doing to ensure that departmental spend is delivering the most effective outcomes in terms of the national performance framework indicators. (S5O-01591)

The Minister for Parliamentary Business (Joe FitzPatrick)

The national performance framework sets out the Government’s priorities. The programme for government sets out the actions that the Scottish Government will take over the next year to progress those priorities and the draft budget sets out the funding arrangements.

The Scotland performs website is the reporting tool for the NPF. It provides a continually updated, impartial and transparent stocktake across a diverse range of economic, social and environmental indicators. In addition, to support the parliamentary committees in scrutinising the draft budget, we provide performance information to demonstrate the interrelationship between the Government’s priorities and spending plans.

Ivan McKee

The minister will be aware that the NPF is internationally acknowledged to be a world-leading process for measuring success in public service delivery. Does he agree that continuing to ensure the link between public sector spend and the delivery of measurable performance is the right approach and in accord with the principles determined by the Christie commission?

Joe FitzPatrick

Yes, I do.

The Deputy Presiding Officer

That is brevity for you.


Economy, Jobs and Fair Work

The Deputy Presiding Officer

Question 1 has not been lodged for reasons that were explained.


Town Centres (Support to Attract Businesses and Jobs)

2. Fulton MacGregor (Coatbridge and Chryston) (SNP)

To ask the Scottish Government how it supports local authorities in attracting businesses and jobs to town centres. (S5O-01595)

The Minister for Business, Innovation and Energy (Paul Wheelhouse)

The Scottish Government is committed to revitalising our town centres by stimulating inclusive economic growth and supporting opportunities to attract investment. We are working with local authorities to deliver plans that attract a range of businesses and services to town centres and that work is supported by a number of initiatives.

Those initiatives include the town centre action plan, which is helping to stimulate a wide range of activity in our town centres. The “Town Centre Action Plan—Two Years On” report was published in February 2016. The town centre first principle recognises that town centre locations are not always suitable, but asks that the rationale for locating projects or investments elsewhere is evidenced and transparent. Finally, Scotland’s Towns Partnership has been funded to facilitate activity and to share and promote learning from activity happening at local level.

In addition, Scotland’s business rates package is the most attractive in the United Kingdom, with total rates relief of around £660 million in the current financial year and more than 100,000 premises benefiting from the small business bonus scheme, including more than 4,000 in North Lanarkshire.

Fulton MacGregor

Just last week, I held the second in my series of town centre regeneration meetings for Coatbridge town centre. There is a lot of goodwill towards the town centre and a strong desire for it to thrive again, but no single stakeholder seems to have the levers or strategy to make all the necessary changes. What measures are in place to help communities, including local authorities, elected representatives, parliamentarians, local businesses, community groups, private owners and other stakeholders to form strategy groups that are interested in working together to improve town centres?

The Deputy Presiding Officer

I remind everyone that it is useful to have short questions and relatively succinct answers.

Paul Wheelhouse

The Parliament has a cross-party group that focuses on these issues and that is one way in which parliamentarians can engage in the agenda.

Scotland’s Towns Partnership, which I referred to briefly in my original answer, is an excellent source of advice and information for newly established strategy groups that are identifying the next steps for town centre improvements. We have established STP as the go-to body for all town centre activity in Scotland, because we recognise the need for dedicated support for town centres.

The town centre toolkit, which is hosted on the STP website, gives communities information and advice on how they can make their town centres more attractive, active and accessible, and strategy groups might also wish to use the understand Scottish places data tool, which is an online platform that is designed to help users to better understand the function of towns in the modern era. It provides the opportunity to compare and contrast towns across Scotland to learn from good practice.

The Deputy Presiding Officer

I do not know what succinct means any more. I call Dean Lockhart.

Dean Lockhart (Mid Scotland and Fife) (Con)

I will try my best, Presiding Officer.

I note the series of measures that the minister described. Why does Scotland have the highest number of empty shops in the UK? Could it be the business rates? Could it be the large business supplement?

Paul Wheelhouse

We have a competitive business rates package in Scotland and, as has been demonstrated by the Cabinet Secretary for Finance and the Constitution, we are making every effort to listen to representations that were made to the Barclay review and to tailor the rates package. The budget tomorrow will set out more detail of the Government’s plans to support businesses at the local level but we have a wide range of tools in our locker to help small businesses. Through our support for the enterprise and skills review, we are encouraging businesses to engage with the enterprise agencies and to gain support.

The Scottish Government uses a range of measures to help small businesses and our town centres. The advice that I gave to Mr MacGregor, and what will be set out in the budget tomorrow, form a complete package of support to help the small business community.


European Structural Funds and Regional Policy (Discussions)

3. John Mason (Glasgow Shettleston) (SNP)

To ask the Scottish Government what discussions it has had with the United Kingdom Government regarding European structural funds and regional policy after Brexit. (S5O-01596)

The Cabinet Secretary for Economy, Jobs and Fair Work (Keith Brown)

On 7 December, I met David Mundell, the Secretary of State for Scotland, and asked him to confirm the UK Government’s position on whether it was committed to supporting deals across Scotland and for engagement on the industrial strategy.

On 16 November, I had a discussion with Greg Clarke, the Secretary of State for Business, Energy and Industrial Strategy and, on 15 November, I also discussed the industrial strategy with Ian Duncan at the latest Scottish business growth group meeting.

As for European structural funding, on 6 October I met the Economic Secretary to the Treasury, Stephen Barclay, and stressed how vital it is that a sustainable replacement for the funding is put in place.

I will continue to press the UK Government to engage with us so that we can deliver the best outcome for Scotland. Whatever form future funding arrangements take, the UK Government must provide Scotland with no less than the current level of funding that we receive, and the autonomy over that funding that we need in order to align it to Scottish priorities.

John Mason

I commend the cabinet secretary on his workload. Does he agree with the Industrial Communities Alliance that older industrial Britain, which includes not only Scotland but the north of England, the midlands and elsewhere has benefited greatly from the structural funds and would have a real problem if the UK did not continue them?

Keith Brown

I agree. Some £395 million of European structural funding has already been committed, matched by more than £500 million from Scottish partners, giving a total investment of £900 million. As John Mason said, that money is crucial to those communities that he has talked about.

On 29 November, in Edinburgh, I joined many of those who have benefited from that support to celebrate and promote the progress of projects to date. At that event, I heard about, for example, Zero Waste Scotland using a grant of £30 million to support the resource-efficient circular economy accelerator programme, which supports more than 2,000 small and medium-sized enterprises and organisations in the community sector. Projects that are involved in that include the restoration of a community centre in Papa Westray in Orkney and the replacement of an inefficient bakery oven in the Little Bakery in Dumfries. Details of the second phase of funding will be announced in the new year.


Living Wage (Support for Employers)

4. Mairi Gougeon (Angus North and Mearns) (SNP)

To ask the Scottish Government how it encourages employers to pay at least the living wage to under 25s. (S5O-01597)

The Minister for Employability and Training (Jamie Hepburn)

Accredited living wage employers who pay the real living wage are paying that to all staff aged 18 and over.

In Scotland, we now have proportionately more than five times as many accredited living wage employers as in the rest of the United Kingdom, which is testament to this Government’s commitment to making Scotland a living wage nation. We are supporting the Poverty Alliance by increasing funding for the Scottish living wage accreditation initiative to £336,000 this year, and are working with it and its leadership group to support its efforts to target low-paid sectors.

Mairi Gougeon

What discussions has the Scottish Government had with the UK Government on including those under the age of 25 in the national living wage, given that they continue to be discriminated against by that Government? What actions is the Scottish Government taking to support young people into positive destinations, especially in light of the year of young people next year?

Jamie Hepburn

Mairi Gougeon has identified three issues. The Scottish Government has ensured that the Scottish welfare fund can be used to help young people who are affected by changes to housing benefit entitlement, which we have opposed.

On the national living wage, the first thing to emphasise is that it is a con trick—it is not the living wage that was set out by the living wage commission. Nonetheless, it being a statutory process, the Scottish Government has, in its responses to the Low Pay Commission, set out proposals to decrease the differential between the youth and apprentice rates and the adult rate. However, of course, we want the real living wage to be the norm across the board. That is why we set out in our general election manifesto a proposal to make it a statutory requirement and why we continue to promote it.

Ross Greer (West Scotland) (Green)

Does the Scottish Government require companies to pay the living wage to all workers, regardless of age, if they wish to receive funding from the enterprise agencies? If not, why not?

Jamie Hepburn

We are working actively with our enterprise agencies to ensure that they are playing their part in the promotion of the real living wage. We take that effort seriously and are leading from the front as an Administration. That approach is paying dividends, which is why, of all the UK nations, Scotland has the highest proportion of its working-age population being paid the living wage or more.


Disability Employment Gap (Targets)

5. Mark Griffin

To ask the Scottish Government what plans it has to create targets with specific deadlines to reduce the disability employment gap. (S5O-01598)

The Minister for Employability and Training (Jamie Hepburn)

In “A Fairer Scotland for Disabled People”, which was published in December 2016, the Scottish Government set a target to at least halve the disability employment gap. We are working with stakeholders to develop the timetable, along with further actions to be taken to achieve our ambitions for disability employment. We will set out more detail at the major congress on disability, employment and the workplace that is planned for early 2018.

Mark Griffin

Looking ahead to the new devolved services, what on-going engagement has the minister had with the third sector since the decision was made to award just 20 per cent of the contracts to bids led by the public and third sectors? Is he assured that the supply chain providers can afford to deliver a high-quality service when the private sector has such a substantial role?

Jamie Hepburn

Our new employment programme, fair start Scotland, which will begin in April 2018, is delivered by a range of partners. Contrary to the impression that Mark Griffin has given, when we look at the global value of the nine contracts awarded, we see that some 95 per cent of the value of those contracts involves the third sector, either as the main contract holder or as the delivery agent of a main contract holder, so the third sector has a significant role to play. I am confident that the programme will be a success and I continue to engage with the third sector and with all those who have an interest in ensuring that people have the chance to get employment in Scotland.

Clare Adamson (Motherwell and Wishaw) (SNP)

The minister mentioned the new transitional employability services of the Scottish Government. Work first Scotland and work able Scotland have, in their first six months, helped more than 3,500 disabled people into work. Does the minister agree that those programmes are both effective in dealing with disabled people in a dignified way?

Jamie Hepburn

Our ambition, through both our transitional arrangements and our longer-term approach, is to ensure that all people who utilise our employment programmes are treated with dignity and respect, irrespective of whether they have a disability. We set out an ambition of supporting up to 4,800 people into work through our transitional programme this year. As Clare Adamson has correctly pointed out, we are halfway through that initiative and already that effort has supported some 3,500 people.


Workforce Productivity (Action)

6. Brian Whittle (South Scotland) (Con)

To ask the Scottish Government what action it is taking to increase workforce productivity. (S5O-01599)

The Cabinet Secretary for Economy, Jobs and Fair Work (Keith Brown)

Scotland’s labour productivity growth has outstripped the United Kingdom’s in recent years. Gross domestic product per hour worked has increased by 6.6 per cent in Scotland since 2007, compared with 0.8 per cent for the UK as a whole. The Scottish Government recognises that improving the productivity of our workforce is a central driver of inclusive economic growth. That is why we are taking forward a range of programmes, such as our investment in skills, developing the young workforce, addressing inequalities in our workforce, and the fair work agenda. Through the enterprise and skills review, we have also established a clear, forward-looking agenda to improve the system of enterprise and skills support in Scotland and to make a substantial and valuable contribution to increasing our productivity and broader economic performance. I hope that those actions and the progress thus far will be welcomed by the member.

Brian Whittle

The cabinet secretary will be aware of the impact of poor physical and mental health on productivity, so strategies such as the mental health strategy and the obesity and diet strategy can have huge implications for the nation’s productivity. With that in mind, what input does the cabinet secretary’s team have across other portfolios?

Keith Brown

We make regular contributions at Cabinet level among Cabinet colleagues, and also between ministerial colleagues. The mental health strategy is much more in the portfolio of my colleague Maureen Watt. If the member has any particular questions on that I would be happy to furnish him with answers, but he can be assured that there is regular collaboration between Cabinet ministers and ministers across portfolios.


Seasonal Skilled Labour (Discussions)

7. John Scott (Ayr) (Con)

I declare an interest as farmer.

To ask the Scottish Government what discussions it has had with the UK Government regarding establishing schemes that aim to attract more seasonal skilled labour across all sectors, such as the former seasonal agricultural workers scheme. (S5O-01600)

The Minister for Employability and Training (Jamie Hepburn)

The United Kingdom Government’s position on migration post-Brexit is likely to have a major impact on the availability of labour, not just seasonal skilled workers but across the board in both high and low-skilled jobs. That is one of the reasons why the Scottish Government is lobbying the UK Government hard to maintain membership of the single market, with its associated free movement of citizens. Scotland values the contribution that temporary workers and the migrant community make to our economy and we are determined to do what we can to continue the current arrangements.

John Scott

The minister is aware that there is an emerging difficulty in attracting skilled labour to work in our food processing, tourism and agricultural sectors, as well as in other sectors. How does he intend to address that clearly defined and growing problem, which is currently driven by the fall in the value of the pound against the euro and threatens to undermine the future success of our tourism and food and drink sectors?

Jamie Hepburn

I am rather surprised that that question comes from a member on the Conservative benches, given the great pressure that is being caused as a result of his party’s shambolic handling of the Brexit process.

As I set out in my initial answer, we continue to lobby the UK Government hard, to ensure that we can continue to access the skilled labour from elsewhere in Europe that we will require for our economy. Of course, we cannot rely on just that, and we certainly cannot rely on the UK Government in that regard. I take the matter very seriously, as I know Fergus Ewing, the Cabinet Secretary for the Rural Economy and Connectivity, does. There is engagement between sector skills councils and Skills Development Scotland. If more can be done to ensure that we have the skilled workforce that we need for those sectors, we will work towards that. Indeed, I have already seen examples of that happening. Recently, I was up in Argyll and Bute, where I saw the local college actively engaging with the agricultural community to ensure the supply of a skilled workforce in future.


Orkney and Shetland Economies (Support)

8. Liam McArthur

I offer my apologies for my slightly late arrival for portfolio question time.

To ask the Scottish Government what immediate action it is taking to support the economies of Orkney and Shetland. (S5O-01601)

The Cabinet Secretary for Economy, Jobs and Fair Work (Keith Brown)

The Government is committed to promoting economic growth across all our communities, including those in Orkney and Shetland. Our substantial investment in infrastructure, regeneration and business support helps to deliver inclusive growth and economic resilience, creating and retaining jobs in communities across the northern isles. For example, the 2016 Scottish National Party manifesto contained a commitment to take action to reduce fares on ferry services to Orkney and Shetland. The Government is delivering on that commitment, and that is our priority.

On 22 August 2017, the Minister for Transport and the Islands announced our intention to introduce reduced passenger and car ferry fares on services from the mainland to Orkney and Shetland in the first half of 2018. The fares options identified are, in line with the Clyde and Hebrides ferry network, to offer road equivalent tariff on the Pentland Firth routes and a variant of RET on the longer Aberdeen to Kirkwall and Lerwick routes. The average reduction in fares across the northern isles will be more than 30 per cent for cars and 40 per cent for passengers.

Liam McArthur

I thank the cabinet secretary for his answer, and I certainly acknowledge and welcome the decision, albeit belated, on cheaper ferry fares on the external routes. However, as a former Minister for Transport and Veterans, the cabinet secretary will be aware how crucial to the local economies in Orkney and Shetland are our internal ferries, which are a lifeline to the smaller islands in both constituencies. When will the Scottish Government honour the commitment that it made in 2014 to provide fair funding for those lifeline services?

Keith Brown

As the member mentions, we made that commitment as long ago as when I was transport minister, and directly to the councils involved. The present Minister for Transport and the Islands has carried that through in the discussions that he and the Cabinet Secretary for Finance and the Constitution have had with the relevant local authorities. It is right that those discussions are allowed to take place. The particular needs of the islands as regards internal ferry services are matters that have, quite rightly, been the preserve of those islands’ authorities. The extent to which the member would like to see further support from the Scottish Government is rightly a matter for discussion between the parties involved. It may be that further progress can be made on that, depending on how the budget discussions go. It will be for the Cabinet Secretary for Finance and the Constitution to talk about in his budget proposals and for the Opposition parties to play their part, by making their own suggestions and seeing where they can support the Scottish Government‘s budget.

Jamie Halcro Johnston (Highlands and Islands) (Con)

Given the Cabinet Secretary for Finance and the Constitution’s protestations during and since last week’s debate on fair ferry funding for Orkney and Shetland’s internal ferries, will the cabinet secretary confirm that it is still normal protocol for the Scottish Government to put its own commitments into its own budget, rather than relying on Opposition parties to do so on its behalf?

Keith Brown

I know that the member was not here at the start of the parliamentary session, but this is a minority Government and a Parliament of minorities and, in that context—just as at Westminster—people have to have discussions and sometimes even make compromises. That is why it is important that Opposition parties play their full part in the budget process. The implication in the member’s question is that his party wants to play no part in the Parliament’s budget process. That is its entitlement, but I think that it will lose out, as will its local electors, if it does not take part in the process.


Improving Productivity (Progress)

9. Colin Beattie

To ask the Scottish Government what progress it is making in improving productivity across the country. (S5O-01602)

The Cabinet Secretary for Economy, Jobs and Fair Work (Keith Brown)

As I have mentioned previously, Scotland’s labour productivity growth has outstripped that of the United Kingdom in recent years. The most recent data shows that gross domestic product per hour worked has increased by 6.6 per cent in Scotland since 2007, compared with 0.8 per cent for the UK. We have also improved our ranking against other Organisation for Economic Co-operation and Development countries in that time.

We believe that all areas of Scotland will make a vital contribution to improving our productivity. That is why we are working with partners across Scotland to improve our performance. For instance, we are making substantial investments in improving transport connectivity across the country. We have committed up to £1.08 billion over the next 10 to 20 years for city deals in Glasgow, Aberdeen, Inverness and Edinburgh—the biggest funder of city deals in Scotland. We are working with other city regions to develop proposals and we have committed to establishing new regional economic partnerships, representing every community in Scotland.

Colin Beattie

Does the cabinet secretary agree that without such an improvement in productivity, income levels in Scotland might not develop to the extent that we would like?

Keith Brown

I think that is true. Improving our productivity is central to delivering sustainable and inclusive economic growth and to increasing wages and incomes across Scotland. That is why we are taking the actions that I mentioned. Vital components of increased productivity relate to innovation, management capacity, the skills of our workforce and the investment that the Government makes. We are trying to take action on all those fronts to increase productivity.