Meeting date: Tuesday, May 26, 2020
Meeting of the Parliament (Hybrid) 26 May 2020
Agenda: Time for Reflection, Topical Question Time, Covid-19 (Transport), Covid-19 (Economy), Covid-19 (Education), Decision Time
- Time for Reflection
- Topical Question Time
- Covid-19 (Transport)
- Covid-19 (Economy)
- Covid-19 (Education)
- Decision Time
The next item of business is a statement by Fiona Hyslop on Covid-19 and the economy. The cabinet secretary will take questions at the end of her statement, so there should be no interventions or interruptions.15:23
We know that, as well as being a public health crisis, the Covid-19 pandemic is an economic crisis. I have real sympathy for those who have had to close their businesses or who have lost their jobs, and I understand the need to carefully get our economy moving again.
Our route map sets out a phased approach to lifting lockdown measures, to give people and business time to prepare to begin the process of restarting. Today, I will provide more details on our plan for restart and our wider recovery.
Our economic response has been defined by four phases: response, reset, restart and recovery. Our initial response has been focused on protecting lives, critical services, businesses and household incomes, and our economic interventions so far have been significant.
We have set out a unique package of business support of more than £2.3 billion to reflect the specific needs of our economy. The support includes rates relief measures, hardship funds and grants for specific sectors such as small businesses, retail, hospitality and leisure, and seafood and fisheries.
Support is getting to those who need it. Under the business grants funding scheme, by 19 May—last week—local authorities had worked hard to pay out almost 65,000 grants, with more than £741 million being distributed to support Scottish businesses.
We know that recovery for some sectors, such as tourism, will be extremely challenging, and Fergus Ewing is leading Scottish Government activity to seek more financial support and to work with that sector to steer and plan for re-opening.
I announce today that we will extend eligibility for the current small business, retail, hospitality and leisure grants to businesses that occupy multiple premises with a cumulative value of more than £51,000, and to businesses that occupy premises such as shared office spaces, business incubators and shared industrial units where the landlord is the ratepayer.
We are also working with local authorities to support small businesses that are not in the rates system and were not eligible to apply to the hardship scheme solely because they did not have a business bank account. Further detail on those arrangements will be set out later this week.
Moving beyond the initial response, we have worked to reset, including working to clear the supply chain blockages that we experienced at the beginning of the crisis. That has laid the groundwork for us to restart the economy.
The sacrifices that we are all making are having an impact, but the margins for controlling the virus are tight. Our economic restart must be safe and should be built around three pillars: successful measures to suppress the virus; guidance that promotes fair and safe workplaces and sectors; and the right structures for workplace regulation.
On our measures to suppress the virus, the First Minister today announced that our test and protect approach will be rolled out across health boards. The roll-out will include the publication of guidance for those who are self-isolating and for employers.
Clear guidance and regulation are essential in providing confidence to workers, employers and customers that workplaces are safe. Guidance that was produced recently by the United Kingdom Government will be helpful, but it goes only so far, which is why we are developing sector-specific workplace guidance.
Reflecting the diverse nature of our businesses, our guidance is being developed through a number of different routes. Some industries have already published guidance, whereas that of others is still in development. Ministers across Government are working in partnership with industry, trade unions and regulators to prioritise activity based on the phasing that is set out in the route map.
We are currently working with around 14 sectors. We will publish guidance sector by sector in the coming days and weeks.
I am pleased to begin that process today with the publication of guidance on manufacturing and retail. The guidance draws on the experiences of businesses that have responded magnificently so far in providing essential equipment and the services that are needed in the crisis, while maintaining safe workplaces. Both sectors have excellent examples of business, trade unions and regulators showing collective leadership to create the right environments to protect workers and customers as we learn to live and work in the new normal.
Those publications should be considered alongside guidance on education and transport—also published today—which are critical to people being able to work. They will be followed by more sectoral guidance later this week, including for the construction sector, with which we have been working closely to agree a carefully planned approach.
On its own, guidance will not create safe working environments. We are also working closely with the key enforcement agencies—the Health and Safety Executive, local authorities and the police—to ensure that there is a joined-up approach to the enforcement and monitoring of workplace public health measures. I announce today the publication of a joint statement that sets out how those bodies will work together to ensure that workplaces operate safely and in compliance with the new regulations.
As that statement sets out, it is essential that employers carry out a Covid-19 risk assessment and that, where possible, such assessments should be developed with union health and safety representatives. Working together—employers, workers, unions and the regulatory bodies—we can create safe workplaces for all.
It is also vital that there is a public health advice service for businesses. We are collaborating with Public Health Scotland to enhance its healthy working lives service, which will provide small and medium-sized enterprises, in particular, with the advice and support that they need to implement safe working arrangements.
I will continue to take the steps that are necessary to build capacity across the system, to ensure that workers and consumers have the confidence to return to safe workplaces.
As more parts of the economy restart, we will be putting our fair work principles at the heart of everything that we do, reflecting our joint statement with the Scottish Trades Union Congress, and we will review those principles throughout the recovery phases to ensure they respond and adapt accordingly. I want to continue to work with employers to ensure that workers are treated fairly if they are shielded or managing childcare as the schools transition. It is essential that we understand the impact of the crisis on equalities groups, particularly women.
Our recovery is about looking forward and preparing our economy for a post-Covid future. Our aim is not only to get back to where we were. We will need a revolution in economic thinking that stimulates and values co-operative sharing of risk and reward—a revolutionary approach that rethinks what value is, and where old thinking of battling over wealth distribution that is never properly delivered is replaced by collective endeavour. The time of a wellbeing economy has well and truly arrived—a time in which creative thinking about wage subsidies can be seen as a generator of innovation and change.
We must be brave and bold and rethink the world of work and how we can work productively. We must think differently about remote working—in geographic as well as workplace terms. We must look to a new future that accelerates a green recovery, and we will press the UK Government on transmission, carbon capture storage and other critical issues.
I want to explore ways to advance energy transition measures—for the north-east, in particular—with a major focus on domestic manufacture and supply chains by working to build resilience into all that we do to meet and manage domestic demand, and by putting innovation, technology and advanced manufacturing at the heart of our new futures industrial plan.
Our recovery will be an opportunity to renew our economy and build our resilience and future prosperity. We have seen an innovative and compassionate response from all parts of Scotland, and by harnessing the innovation, skills and strengths of our businesses and people we can ensure that Scotland can thrive and compete in the future, and that our recovery is inclusive.
I understand the impact of the crisis on those who have lost their jobs, and I know that the impact will be greater on those who have traditionally faced barriers in the labour market. We will provide continued support to those groups to ensure that no one is left behind.
We will support people to retrain and reskill into good, sustainable jobs as the economy begins to grow again, to make the most of the skills and expertise that we have—for example, in the oil and gas industry—and to lead the way towards clean energy and technologies such as hydrogen and carbon capture and storage.
We will support businesses to innovate and adapt their business models, embedding the use of data and new technology to meet changing demands and to access growing global markets for more sustainable goods and services.
We will continue to seek the advice of experts, including the independent advisory group on economic recovery, as we set our path to renewal, and we will engage with, learn from and collaborate with other countries, including the group of wellbeing economy Governments, with which we share values and purpose.
Setting that clear direction to where we want to get to, and working with employers, people and places, will be key to ensuring not only that we recover from the impacts of covid, but that we build back a better economy that is more resilient and able to thrive in the future.
The cabinet secretary will now take questions on the issues that were raised in her statement. I intend to allow around 35 minutes for questions, after which we will move on to the next item of business. As always, succinct questions and answers are appreciated.
As the number of deaths from Covid-19—thankfully—declines, the economic challenge that we face shows no sign of abating. Indeed, many businesses and local authorities are in desperate circumstances.
I welcome the remarks in the cabinet secretary’s statement regarding the extension of the criteria to cover multiple premises and those in shared spaces in which the landlord is the ratepayer. However, we saw reports yesterday that, despite the Scottish National Party promising to pass on £155 million in funding to councils, there is still no word on that actually happening. Many councils now face funding black holes of tens of millions of pounds by the end of June.
There is also a concern that the SNP is putting Scottish businesses at a disadvantage by not allowing them to reopen alongside English firms. Construction is the obvious example, with the housing minister refusing to say when the sector can get going again. Manufacturing will suffer too, potentially losing out on contracts to firms south of the border.
The SNP has a duty to provide Scottish businesses with the support that they need while they are forced to stay closed, but the latest figures show that that is not happening. There are 16,500 applications for support, and £458 million in payments is now outstanding. To make matters worse, more than two months into the crisis, there is still confusion and disparity over which businesses qualify for support. The cabinet secretary said that business grant support is getting to those who need it, yet some dentists and garages are receiving grants while others are being excluded. It is a postcode lottery.
Will the cabinet secretary give clarity and provide a level playing field for those businesses?
It would have been helpful if Maurice Golden had done his homework. The £155 million, which is for councils and is not part of the business support for the economy that we are now discussing, has already been paid. He should know that.
There is an important point about supporting businesses. The Scottish and UK Governments have moved swiftly to support businesses. Schemes have been set up in a matter of weeks, but because they happened swiftly they have also been simple. In the rest of the UK, and in Scotland, businesses that do not have a business bank account have not received payments, because there are concerns about the possibility of fraud when payments are made into personal bank accounts. Those are challenges across the UK.
We are working hard with our local authority partners to deliver support. Mr Golden wants to have the same level playing field across all local authorities, but we also have Opposition members, including other Conservatives, saying that we must respect the autonomy and independent decision making of local authorities in a host of different areas.
We are providing guidance, and Kate Forbes, the Cabinet Secretary for Finance, will provide further guidance on the announcements that I have made today, which will be very welcome. That is, in part, a response to what members have said in this chamber. We have had Clare Adamson and Linda Fabiani arguing the case for the extension of grants to shared office spaces, and Alex Cole-Hamilton and Andy Wightman made those points last week in relation to the Coronavirus (Scotland) (No 2) Bill. Angus MacDonald and Liam McArthur have made points about businesses continuing to get hardship grant support if they do not have business bank accounts, and many businesses have made those points directly to us. You cannot attack us for being unresponsive when we are looking for a better opportunity to move, tack and change and to roll out even more grants.
The UK Government is adapting its schemes. It has done that with the coronavirus business interruption loan scheme and the coronavirus job retention scheme. We are doing the same thing, because we want to help as many businesses as possible. With some good grace and focus, we can ensure that as many businesses as possible get support as we move into the future. We will use all the resources that we have to meet the specific needs of the Scottish economy. I hope that members will support not only what we are putting forward today but businesses in their own constituencies, so that they can get back to work safely.
Our phasing report has been well received. Opinion polls show that people have faith in the Scottish Government and real concerns about the leadership elsewhere. Our job is to lay out a phased route map that will lead us in the right direction. Manufacturers and companies that are not in phase 1, but which can start preparing for phase 1 when we get Thursday’s hoped-for green light, want to have a lead-in time to prepare their supply chains for when they do return. Their biggest challenge is not in setting up their business when they return but in doing so profitably. Let us get behind business, make sure that businesses can work safely and make sure that they and individuals have incomes.
I thank the cabinet secretary for advance sight of her statement. At the weekend, the cabinet secretary said that the Scottish Government’s route map for business and the economy is “plain as day”. Today, she has called for a “revolution in economic thinking”. Perhaps she can tell us what the difference is between Boris Johnson’s mantra, “If you can’t work from home, go out to work” and the First Minister’s statement to this Parliament, in which she said that we will
“focus first on industries in which people simply cannot work from home.”—[Official Report, 21 May 2020; c 6.]
What is the “plain as day” and “revolutionary” difference between the First Minister’s and the Prime Minister’s return-to-work policies? Does she mean that all industries, factories and offices across Scotland in which people cannot work from home must reopen, or just some of them? Can the cabinet secretary, who mentioned the construction industry, tell us about the guidance that is coming out later this week? What steps are contained in it to ensure that workers in the construction industry who raise health and safety concerns when they return to work will not face the threat of blacklisting for doing so?
There are many parts to that question. It is clear that we expect home working to continue—indeed, that will continue be the case for the majority of people. We heard from the transport secretary about the capacity of public transport; there will be a demand for home working. From a safety point of view, the more that people can work from home, the safer it will be for the few people from the industries that initially have to restart work who have to use the transport system.
Ours is an integrated response; it also recognises that people will be working from home because of childcare responsibilities and for other reasons.
I emphasise that there is a clear difference between our policy and the UK Government’s policy. From the start, the UK Government has said that people who cannot work from home should be working. That is not our position at all.
We have been clear in setting out what our approach will be in each of the phases. For example, in phase 2, indoor non-office workplaces such as factories should resume work once the relevant guidance has been agreed.
On manufacturing, we have worked very closely with the trade unions, which is important in giving people confidence—they can be confident that trade unions and employers have come together in relation to the sector-by-sector guidance.
Richard Leonard asked an important question about advice and compliance, which are critical to ensuring continued safety, and the third pillar of my announcement is a joint statement by the HSE, local authorities and the police. We have to build capacity in that regard, and there have been welcome statements by trade unions in support of that element of my announcement.
The member will find that recognising people’s rights is part of the guidance on construction and part of the third pillar that I have mentioned—indeed, it is the law that people can refuse to go to work if they feel that their workplace is unsafe. It is incumbent on us all to set out what the issues are, and this week we will provide guidance on construction and advice on the compliance and enforcement regime.
I thank the cabinet secretary for the advance copy of her statement. I am pleased that there has been progress on meeting the needs of small independent businesses that are not ratepayers—that is, they pay rates through a landlord. However, I am a bit confused about the comments on the gathering in of expert information and advice.
The Government and the cabinet secretary mention the advisory group on economic recovery, which is leading the work on some of the important questions about how we recover, but the Government also has a separate sustainable renewal advisory group, and there appears to be no overlap in the membership of the two groups. Will the two groups be working to a shared agenda? Will they be working completely separately, in different silos, as though sustainability is separate from economic recovery? How will the Government ensure that there is coherence when there are separate advisory groups, each working to different ministers and talking about economic recovery in different terms?
The member makes an important point, which I will try to address directly. The shared agenda that I have set out is clearly about sustainable economic recovery. Therefore, the focus of both the advisory group and the existing and continuing sustainability group will be their shared agenda. Both of those groups have access to ministers, and there is co-ordination between them—indeed, they correspond directly with each other. Of course, although advisory groups advise, it is ministers who make the decisions. I hope that the Parliament will also have an opportunity to debate such issues when we reach the stage of publishing our ideas.
I work extremely closely with Roseanna Cunningham, with whom I share an agenda, and with Michael Matheson, especially on infrastructure and transport issues that will form part of the sustainability agenda. I therefore assure Mr Harvie that we all intend to work towards the same agenda and that we will ensure that there is direct access both for ministers and for groups. For example, I know that the advisory group is having extensive discussion with those who are involved in the renewables sector, and especially the groups with which Roseanna Cunningham is working. She is also having discussions directly with the advisory group on economic recovery.
The Health and Safety Executive, local councils and the police have important roles in refereeing complaints and concerns about whether workplaces are safe. However, their powers on those are only those that are conferred by the Health and Safety at Work etc Act 1974, and those on physical distancing are derived from the emergency powers. They do not have the power to close any business simply on the basis that it is non-essential. How can we avoid workplace conflict if those referees do not have powers to enforce the Scottish Government’s guidance?
Will the cabinet secretary provide members with an update on her discussions with the Chancellor of the Exchequer on implementing a universal basic income to help people who have been left out of the various financial support mechanisms introduced by the UK and Scottish Governments?
We have great interest in the idea of a universal basic income. I have not spoken directly to the chancellor about that, but I intend to do so as part of our discussions on recovery. The case for it is also being made by other ministers.
The existing regulations that Willie Rennie mentioned contain powers for the police to enforce the new guidance on physical distancing, which they are doing. If further regulations should be required, we would certainly consider developing and publishing those. However, the statement that has been made today recognises that the issues that we face can—and should—be dealt with by existing legislation, which is also the strong view of the HSE and local authorities. Therefore the approach should be one of compliance with and of policing within both the existing regulations and the physical distancing guidance.
It must be remembered that the powers of the HSE are quite extensive and applying them to the new experience that we are all having will give them more strength. That is one area of a pillar in which I have said that we will have to develop more capacity, which we will continue to do. As we continue to live with Covid-19—unfortunately, it looks as though that will be the case—and as we roll out guidance for different sectors of the economy, more and more workplaces will have to comply with that and will want to give their customers confidence that they are doing so. That will be a critical element of the process and I am glad that Mr Rennie’s question focused on it.
Meeting our statutory targets to end child poverty was always going to be challenging. Now more than ever, we need to have an economy that will work for everyone. As we begin to look at life beyond lockdown and to seek a new future, how will the cabinet secretary ensure that we have a plan not just for economic recovery but for economic resilience? Such a plan might include ideas such as a job guarantee scheme to ensure that, in the future, we cannot be blown off course when it comes to ending poverty and inequality and to securing fair work.
As I referenced several times in my statement, resilience is a key aspect of how we will secure our future. Of course we need resilience in relation to global and local supply chains, but we also need resilience in our economy and our society more generally. If we still have poverty and inequality, it is not a resilient society.
One of the strong lessons of Covid is that we cannot afford a situation in which those who suffer from inequalities suffer most from the disease itself. Building that resilience is very much part of a wellbeing society; it is very much part of what we are seeking to do and will continue to do. That is an important point to raise.
I know that the member has personal experience of driving forward the move to tackle youth unemployment. We had some experience of that over 10 years ago with the financial crisis. This crisis is on a completely different scale, but if we agree collectively that we want to ensure that our young people in particular do not suffer disproportionately, we will have to look at schemes such as those that the member mentions, on job training and job subsidies for innovation and skills in particular. We have done that before to some extent. We might have to think about doing that much more widely than we have ever done before.
The cabinet secretary will be aware that, at the weekend, the hotel and travel company Specialist Leisure Group went into administration, leading to the closure of hotels across Scotland, including three in the Highlands and Islands, and causing huge anxiety for their staff. Although additional support is welcome, does the cabinet secretary acknowledge that the hospitality sector remains in great danger of collapse and can she outline what further measures the Scottish Government will take, using its own resources, to support that sector?
The member might not be aware that the Cabinet Secretary for Rural Economy and Tourism, Fergus Ewing, addressed those points during topical questions this afternoon. I refer the member and others to Fergus Ewing’s answers.
However, the member makes an important point about the importance of tourism to Scotland; it is probably disproportionately important here compared with the rest of the UK. That is why, in our decision making, we have specifically created schemes that do not exist anywhere else in the UK. The creative, tourism and hospitality enterprises hardship fund is unique to Scotland and, as we speak, tens of millions of pounds are being paid out to different sectors—in particular to the tourism sector—through that fund and through the pivotal enterprise resilience fund. Those schemes are particular to Scotland because we know the need for them in Scotland.
There will need to be additional and continuing support for tourism and Fergus Ewing is working to identify where those resources might come from. Again, I mentioned that in my statement.
On the job retention scheme, we need to ensure that the UK Government decides to carry out sector-by-sector analysis in relation to a further extension of the October deadline specifically for the tourism, hospitality, culture and heritage sectors, as they have been impacted the most and will probably take the longest to return to being fully functional. There is also the oil and gas sector in relation to other particular areas.
The member’s points are well made; I refer him to Fergus Ewing’s earlier answers as the tourism secretary.
As the cabinet secretary knows, Aberdeen is suffering not just from the effects of Covid but from the oil price crash, not to mention the stalling of strategic projects such as Aberdeen Harbour. It has also been identified as being particularly hit by Brexit.
What support is the Scottish Government making available to the north-east of Scotland and what representations has the Scottish Government made to the UK Government on behalf of the oil and gas industry in Scotland?
The oil and gas sector is facing a specific and serious situation. We understand from the Oil & Gas UK report that the direct and indirect jobs in the UK supported by the industry could decline by 25,000 to 30,000 over the next 12 to 18 months.
We are working closely with the UK Government on this issue. In particular, Paul Wheelhouse, the Minister for Energy, Connectivity and the Islands, has had extensive discussions with the UK Minister for Business, Energy and Clean Growth, Kwasi Kwarteng, and he has spoken—most recently, on 7 May—to the strategic leadership group on oil and gas and the energy transition.
We are already supporting the north-east, and will continue to support it, in a number of ways. My colleague Michael Matheson, the Cabinet Secretary for Transport, Infrastructure and Connectivity, has engaged with Aberdeen Harbour in particular; we need to work with it on big and important issues to ensure a confident future in that sector.
I have engaged with the minister Nadhim Zahawi at the Department for Business, Energy and Industrial Strategy, who is acutely aware of those issues. We want to co-ordinate the support that can be brought forward.
I have asked my officials to accelerate the work that we were already doing for the north-east—in particular, to see what step changes we can make in transition to such areas as hydrogen. I have also engaged with Aberdeen One, because its plans look as if it can move fairly quickly.
We will look at what we can bring forward, and will report to Parliament when we have further detail.
I welcome the cabinet secretary’s announcement of the extension of the business grants scheme. She is right to do that. Currently, £449 million is unallocated. One in five of those applying have had their applications rejected and, with an overall fall in the number of grants being awarded, there is concern that businesses are losing out on much-needed Government support.
In that light, will the cabinet secretary reconsider the decision to limit businesses that have multiple premises to 75 per cent of grant, putting them at a competitive disadvantage compared with businesses in England, which get 100 per cent of grant? Given that £449 million is still unallocated, will she lift the cap and get desperately needed support to struggling businesses?
The member may have misinterpreted the amount that is available—in terms of not having been allocated—but we are happy to engage, and I can ask my colleague the Cabinet Secretary for Finance to update her separately about that. One of the reasons why there are still issues with grant applications is that, as we speak, some people are still making their applications.
We have extended the grants to those who have multiple properties. I reinforce the point that, for example, a retail chain that is currently operating at 65 per cent—it is still making money—would, under that scheme, receive even more funding, whereas other areas and other types of business would get no funding. The company to which I have just referred could also be in receipt of UK loan funding and job retention scheme money for furloughed staff.
In many ways, a significant number of companies will get a better deal in Scotland than in the rest of the UK, precisely because we have a more generous small business bonus scheme. However, if we are trying to be equitable, to make sure that we can support people, and to have specific additional funding for the tourism industry, as Donald Cameron has asked for, we must direct funds into the pivotal enterprise resilience fund and the creative, tourism and hospitality enterprise hardship fund.
The member can argue to have more funds available for those who have already received funds, or we can direct the funds that we have to those that have yet to receive anything. I think that it is important to support those companies that have yet to receive anything, rather than those that have already received funding for one property and can do so for a number, when others are suffering.
It is about fairness and equity—yes—but we have to respond to the distinct needs of Scotland, rather than copying decisions that have been made elsewhere. If we copied what happened in the rest of the UK, we would not have that funding in the resilience fund or the hardship fund.
I thank the cabinet secretary for ensuring that financial support was made available to a great many businesses as quickly as possible, because of Covid-19. I very much welcome the extension announcements today.
As the cabinet secretary has recognised, gaps and anomalies remain. Will she say more about businesses, such as those that are run from home, which do not qualify for assistance from any Government scheme, and about bed and breakfast operators who do not yet have a business bank account?
Those businesses have been the most challenging to support, which is why we and the UK Government used the rates system for the initial tranches, to reach tens of thousands of small businesses. Evidence from people who work from home or do not have business bank accounts is more difficult to administer centrally, which is why Kate Forbes will be working with local authorities to establish mechanisms by which those businesses can achieve access to grants.
They will have to provide some evidence. Paying public money into personal bank accounts is very challenging, but we know that that is how some businesses, such as bed and breakfasts, operate. That is why we tried the hardship fund for those businesses that could provide evidence, but there is still the issue of the integrity of the system and, in particular, avoiding fraud, for which the best approach will involve local authorities. We learned from the experience of the newly self-employed scheme, which is unique to Scotland, that there is a way in which we can probably forge a path to ensure that the businesses that Bruce Crawford spoke about can achieve funding. Again, it is about being agile and responsive. It might not be as swift as people would want it to be, but we know that bed and breakfasts will be one of the last parts of the economy to open up so, even now, grant support will help to bridge the period until they can open.
While we are on the topic of bed and breakfasts and tourism—I am not the tourism secretary but I was, for many years—I hope that the people of Scotland will get behind Scotland’s tourism industry. I want them to make bookings when they can to support our local industry and visit not just Bruce Crawford’s constituency but elsewhere, as part of our economic response and return.
The cabinet secretary mentioned how she has given specific support to a number of sectors. However, constituents who have been unsuccessful in their applications, particularly to the hospitality fund, have been given no feedback on whether their applications failed the criteria or simply required additional information. What can the cabinet secretary do to correct that and ensure that it is not repeated in the further support that has been announced today?
With regard to feedback, I am happy to share the response that we received about why, on a global scale, the relevant information has not been provided. Sometimes applicants have not provided the correct information and sometimes they do not have business bank accounts, which are a requirement of those schemes. As members have heard, we are finding another way to help to support that particular group.
Alexander Burnett’s point about getting feedback is really important. The criteria for some of the funds is that applicants have had to have experienced a 50 per cent loss of income, but it is about not income replacement but hardship. The response should include indications of where people can find additional help for their businesses. An example is the business bounce back loan, which was announced after we established the hardship and resilience fund. Many companies are looking for short-term cash flow, so the bounce back loan, which is very welcome, is another source of income.
With regard to oversubscription, it is obvious that there is a clear need but not everybody’s needs can be met. The pivotal enterprise fund’s criteria and the involvement of South of Scotland Enterprise and Highlands and Islands Enterprise, Creative Scotland and the tourism body VisitScotland have helped to identify the pivotal companies that are vital to the recovery of sectors and regions in Scotland.
Thank you very much. To get more questioners in, I would like succinct answers and succinct questions, please. I call Alex Rowley, to be followed by Annabelle Ewing.
The trade union Unite argues that the way out of the crisis is through major investment in growth by taxing more those who can afford to pay more and by unprecedented job creation schemes. Does the cabinet secretary agree? Also, although she referenced oil and gas in her statement, there was no mention of offshore renewables. Yards are lying empty in Burntisland, Methil and Stornoway. Has the Government given up on us getting jobs from the offshore wind renewables sector?
If the member rereads my statement, he will see that I was specific about the importance of renewable technologies to the green economic recovery.
I agree that additional job creation in that area will be vital. We should look to bring forward initiatives that we might have looked to pursue on a longer-term basis and consider pursuing them in the shorter term. Across the Cabinet, we are looking at what infrastructure opportunities we can bring forward. In that regard, we must make sure that we can retrain and reskill people, where that is required.
Sadly, people will lose their jobs because of the economic crisis that we are in. Part of our responsibility is to ensure that we can redeploy them. That will require the provision of Government and state support in that area.
Alex Rowley asked about offshore renewables. Do I want a functioning, competitive supply chain here in Scotland? I absolutely do. Do we have all the levers to bring that about? The answer is no. We will try to persuade the UK Government to relax some of the constraints surrounding the contracts to which Mr Rowley refers, to allow us to be in a far more competitive space and to ensure that domestic companies can win those contracts.
Resilience is a factor here. Having shorter supply chains for international activity will be imperative in the future, and that should play to Scotland’s advantage in the renewables revolution.
When it comes to areas that are covered by Westminster’s reserved powers, the job retention scheme is playing an important part in the response to the coronavirus pandemic by helping to mitigate unemployment and protect people’s livelihoods.
With different parts of the UK at different stages of lockdown, it is vital that the scheme remains in place for as long as it is required in each of the devolved nations. Can the cabinet secretary provide an update on discussions with the UK Government to ensure that the scheme’s support for Scottish workers is not cut off prematurely?
The member might be aware that Kate Forbes and I wrote to the Chancellor of the Exchequer on that specific issue. He has yet to reply, but we wrote to him immediately before the announcement that the job retention scheme would be extended from the end of June to October. That extension will support a large number of the companies that we are seeking to support, and it is welcome that the flexibility that has been called for by those companies that want to restart their businesses slowly and gradually, and to keep some staff on furlough as they do so, is to be provided. There are still challenges with that and we will continue to press the UK Government, but it has responded to our requests for an extension and for flexibility.
However, there will still be sectors that might need support beyond October. In particular, we need to see whether we can persuade the UK Government to have an extension for the tourism, hospitality, heritage and oil and gas sectors. The UK Government was responsive at the start of the job retention scheme when our medical advice was distinct and different from that for the rest of the UK for a short period of time, so there is no reason to think that it would not be flexible at the other end of the process as we come out of the scheme, but we will enter those discussions in good faith and will continue to press the case for the sectors in Scotland that we think will need support beyond October.
There are more than 2,500 tourism businesses in Scotland that sit above the £51,000 rateable value threshold and which, to date, have received no grant support whatever. Those medium to larger businesses are the lifeblood of the industry; they are major employers, which have received zero income since lockdown started.
I welcome what the cabinet secretary had to say about extending the current grant to businesses that occupy multiple premises with a cumulative value of more than £51,000. Will that extend to those businesses with a single premises that has a rateable value of more than £51,000? If not, why not?
I am neither the tourism secretary nor the finance secretary, but as the economy embraces all sectors, I will try to answer that question. I agree with the member that that would be desirable if we could do it, but we are not currently in a position to do it.
I raised the issue with the chancellor, because at the time there was a strong underutilisation of the UK Government’s guarantee for the coronavirus business interruption loan scheme, although that subsequently changed with the bounce back loan scheme. Indeed, it is interesting that some banks have rapidly seen more applications for the bounce back scheme than they have had for the original scheme. I asked the chancellor whether, where there was undershooting, banks could use the resources from the UK Government to extend the grant opportunities for those with rateable values over £51,000 and provide funding for them across the UK. If that were done, we would get consequentials and we would be able to use them in that way. However, that has not been taken up as yet.
On the one hand, people want us to be the same as the UK, but on the other, they want us to do something different. We are trying to chart a course that is both fair and equitable. The issues around businesses with rateable values over £51,000 in the tourism sector are one reason why we set up the hardship fund and the pivotal resilience fund, and companies can apply to those two funds. There has been a great deal of demand, but I know that one of the companies that originally had concerns—the Selkirk Arms—has now had funding from that route.
As we speak, those funds are starting to deliver. However, that will not stop us impressing on the UK Government the need to provide more funding for businesses with rateable values over £51,000. Can we do it on a sector-by-sector basis? That is always problematic, but there may be a case for it, particularly in relation to tourism and hospitality. I will try to maximise my opportunities for resources in making those decisions, but ultimately it will be Kate Forbes and Fergus Ewing who will take that forward.
I ask Claire Baker to be brief. I hope that her question can be followed by a final remote contribution from Richard Lyle.
When the route map was published last week, we saw that the earliest mention of the cultural sector is at phase 3, when it is suggested that museums, galleries and cinemas could reopen and live events be held with restricted numbers. As the cabinet secretary knows, performances are often preceded by the need for recording studios and access to rehearsal space and the mobilisation of crews and technicians. Will there be sectoral guidance that recognises the need for a phased recovery in the cultural sector and enables such activity to take place before phase 3?
The member makes an important point about the culture side of the challenges that we face. People would like to have certainty so that they can plan. We are establishing the guidance groups for the creative industries sector. Currently, there are discussions about how fragmented they might be to reflect the different nature of different parts of our culture and heritage sector, which include not just museums and galleries but, as she said, studios. We are looking to develop guidance for those areas.
On the point about trying to phase activity, the sector is a bit like the construction sector. People need to be able to plan in advance, because they cannot deliver a show or a performance from a standing start. There is essential preparation work, so lead-in time is required. In our dialogue with producers, the unions that are involved and the various sectors, we hope to be able to plan a sensible phased return for the sector.
I hear what the member says about trying to give some certainty. As of now, we have not yet had the decision to move into phase 1, so we cannot give certainty about dates. However, we know how important that certainty is, particularly for the outlying sectors that might not reopen until phase 3.
The final question is from Richard Lyle. I ask him to be brief.
I refer members to my entry in the register of members’ interests. Showpeople are part of Scotland’s heritage and economy and they have been hit hard by the crisis. They have been unable to run any fairs since the start of the lockdown, so they have had no income. Further to the cabinet secretary’s announcement, can she help showmen who are self-employed, do not have a rateable office and are unable to access any funding, and help them to get over this period? What further steps will the Scottish Government take to help showpeople? Will the cabinet secretary please look into their plight in the light of her announcement today?
I know that the member is a great champion of showpeople, who have clearly been hit hard at this time, as have others who are involved in the leisure sector.
I hope that the relaxation and the changes that we have announced today—the new scheme to enable local authorities to support those businesses that do not have rateable properties—might help the sector in which the member has a particular interest. However, I am happy to defer to the Cabinet Secretary for Finance to correspond with him to confirm whether that is the case.
That concludes questions on the statement. I apologise to Claudia Beamish and John Mason, whom I was not able to call.