 Congratulations and welcome to this seventh session of the Economy, Energy and Tourism Committee. This morning, we'll be taking evidence from Brian Wilson, the author of the Scottish I will get the right name. It is the Wilson review for Scottish exports. Mr Wilson, this morning we have had evidence already from quite a number of people with regard to your review and your reviews come up with a lot of people. But before we go to the questions, Dougie just reminded me that we should obviously ask everyone to switch off their mobile phones if you have any electronic devices. I can actually put into silent this morning, because it does interfere with broadcasting. Turn it back to yourself, Mr Wilson. Good morning and welcome. We have had, say, evidence sessions already with regard to the internationalisation of the exports for Scotland. In your review, you are very complementary when you were actually going around gathering evidence. You were also stating one element in your review that there should be a seamless and co-ordinated approach to the exports. There are a lot of frustrations around that. Some of that frustration was the fact that there was, in your words, a plethora of different organisations. Since the review came out, Mr Wilson, what advances have been made in your opinion? Thank you very much for asking me along. As far as advances since the review came out, I understand that there is now a working group between SDI and UKTI, and I think also involving the Scotland Office, which has taken forward the recommendations of the review. To me, that is a very welcome, that there is a follow-through from it that it has not just disappeared into an abyss, and I am sure that the work of this committee will also help to inform that. The seamless approach that came across all the time, which I am sure every review of Scottish exporting for the past umpteen years has heard, I was trying to avoid just the usual cliches about one-stop shops and just to go beyond acknowledging the problem in order to try to come up with some sort of solution. The best I could come up with was this single organisation. Again, I was very wary of not trying to create a problem of too many organisations by recommending the establishment of another organisation, so the approach that I came down in favour of was almost a virtual organisation called Export Scotland, but which would just create a framework in which everybody—to the people who were coming through the door, it does not matter what organisation they are dealing with, all we want to do is that they come through the door, but there is a logical progression that they get the support that they need or the concerns that they have answered, and they come out the door with a conclusion. That conclusion might be that they should not be exporting at all, or they certainly should not be trying to export to China before they export to Ireland, or something that there is a whole range of possible conclusions, but the important thing is that there is a process through that. Therefore, the onus seemed to me to be on the plethora of organisations led by Government, guided by Government to create that seamless approach. What the problem at the moment just now is not just that there is a plethora of organisations, but that there is a lack of co-ordination among them so that there is no sense for the person or the business entering the system that they are into that single channel, which will lead them to a definitive conclusion. Why do you think that there is a continuum of lack of co-ordination? Is it because organisations just want to have this autonomous aspect of exports without engaging in this? You have said that you do not want to use the term one-stop shop. However, you are promoting a single portal in terms of gathering that information together. I am sure that there are a lot of historic reasons. I am sure that there are all the usual factors that we are familiar with. There are always silos and people defending their territory, and some local authorities think that they have the right to be offering this as a service and not necessarily relating to other bodies. There are human factors of just things falling between stools. In the case of, I am sure that we will come on to the SDI-UKTI relationship, but there are areas that are not in any way—nobody is doing it for the wrong reasons—but those things just happen. There are probably some bad reasons for the lack of co-ordination, but, by and large, it is just habit and custom that there has not been enough pressure to join them up. Government has a role to say that this has to happen. This is the way that it has to be done. If those organisations are going to be part of the overall Scottish exporting effort, they should buy into the concept of an export Scotland entity. Some organisations, for instance, such as the Chambers, think that they are doing a good job and that they are quite successful. I think that, if I remember rightly, I do not think that I criticise anyone in the report for doing a bad job. There are real horses for courses element. I have seen trade missions organised by the whole range of those organisations. Some have been very good and some have been a lot less good, but I have seen Aberdeen Chamber of Commerce operating very effectively in the oil and gas sphere. There is not one that is good and one that is bad, but there is a historical legacy that they all exist. What we really need is to make sure that they are all serving the same functions. I am quite sure that we will expand quite a bit from the elements of the review as we go on this morning. I am going to bring in Chick Brody first. In the summary of the report, one of the issues that has raised access to finance has been the most significant barrier. Having run the export companies, I would contest that. There is a lack of culture in exporting culture, I would suggest, in terms of adapting and achieving local representation. How much time did you spend on looking at things other than finance in your report? Probably a lot of time. We met a very wide range of companies and pretty much everything in the report is a reflection of what we heard rather than any preconceived ideas. I think that the distinction—I think that I probably defined two fundamental problems. One is the relatively small number of companies that we come into exporting. That is obviously something that SDI is trying to address. The issue of finance is those that we have crossed the threshold into saying that we want to become exporters and that we have a market, but then finance kicks in as a problem. For instance, we met with the Bank of Scotland, who were exceptionally open and honest about this and saying that, as opposed to their new guys as part of the Lloyds group, but compared to other parts of the Lloyds group that the Bank of Scotland had seriously underperformed as a supporter of exporting, and they had a will to change that. Similarly, the work of previously ECGD, which is now British Export Finance, has been far too narrowly restricted to some sectors. What we heard was that finding financial support once they had come into the exporting network, but getting over the initial hurdle of exporting and factoring and all the other elements that come into it, which make exporting a realistic proposition, that that was a serious problem for them. In terms of a division of time, I think that there is probably a list of the companies and organisations that we spoke to, and it was pretty extensive. It is also complex. I mean with one of the better chambers of commerce just last week, who confirmed that finance was not a problem, the problem was how do we translate the need to export and facilitate support to particularly small businesses. Just on that, one of the other things that you report highlighted was the shortage of skills, which is probably true, but then you go on to suggest that the universities and the colleges might run courses. Running courses and having skill shortages is not going to be fulfilled other than we transfer experience and indeed transfer intellectual property rights to some products that universities produce that could be exported but never reach the market. I mean, what makes you believe that we can—how can we transfer the knowledge of current exporters or those that have been successful in exporting in the past? What makes you believe that running courses is going to encourage people to achieve and get to the market as they need to? Well, one of the early current theme in what we heard, particularly from small businesses who wanted to become exporters, was that mentoring is a very important part of the process. Where it works, it works well, where the experienced exporters are prepared to pass on the skills and experience and to whether, for their own reasons, they are looking for subcontractors or whatever, or whether they have an interest in bringing companies in, or whether they do it purely for pro bono reasons. Where mentoring does occur, it is a very much valued facility for the companies that benefit from it. As for the more formal transmission of skills through courses, I think that an underlying theme of the whole report and everything that we heard is that there has to be a bit of a culture change and that if you do not have a culture within which people think of exporting as a possibility and if people are not educated into the idea that exporting makes business more interesting, more exciting, more profitable, more adventurous, then that is the culture change that I would like to see and many companies could benefit from. Therefore, that should be ingrained into any business courses or there should be exporting dimensions to any business courses in universities and colleges. However, there is also an awful lot of logistical skills that people need to learn. One of the things that I have learned from the sharper end of being involved in exporting is that there are really complicated disciplines there of logistics, of tariffs, of all sorts of obstacles to overcome to actually physically become an exporting company. That was our harness from talking about the Chamber of Commerce. Those who have actually done it felt it, got the T-shirt and encouraged them to propagate the culture that is needed in terms of export. I do not see that coming from universities or certainly currently. I do not see either approach being mutually exclusive. I would have thought that both is of benefit. However, there are courses and an awful lot of things in universities and colleges. I would not have thought that one that included the word exporting in the title would be anything other than a good. Mr Brodie, can I bring in Mr McAlpine supplementary on this one? That is a quick supplementary. You quite rightly mentioned the importance of mentoring. We talked a lot about that when SCC was in front of us last week. In your report, you talked about the narrow base of Scottish companies that do export. Do you see it as a problem if you are trying to match up companies with mentors that that narrow base means that there probably are not enough around to be able to give the exporting expertise to up-and-coming companies? How would you see us overcoming that? I think that there is something in that. I can say that a company in the textile sector can still advise a company in the food and drink sector on the essentials of exporting. It does not have to be within a sector. I would take it more from the other end. I think that if more companies and big companies and successful companies in general could be encouraged to mentor, there is still a lot of capacity within that to be used. I think that the problem with the narrow bases is that there are so many big sectors in Scottish exporting that the rest becomes pretty marginal. Therefore, it is getting more companies either in the sectors that are underrepresented or you are never going to change the balance really because the big ones are so big—financial services, whisky and oil and gas. Those are going to be very big ones. However, the rest, there are plenty around the edges that could be doing it as well. Thank you very much. Thank you. Two brief questions. In the executive summary of your review, which is good reading, for the most part, understandably you dwelt on what might have happened to exports had the referendum decision been different. I am not going to rehearse that. However, as part of our review, one would have thought when we would look forward as to what alternatives might happen if, for example, we come out of Europe. What is your view on that and how Scotland's export community should address that issue? I think that I put a number on it. I think that I say that there are 330,000 jobs in Scotland that are dependent on exporting to the European Union. If you ask me for a personal view, I think that it would be bonkers to come out of Europe. However, from the purposes of this review, I think that Scottish exporting would be extremely adversely affected. I have no doubt in due course every company and every trade union that has a vested interest in ensuring that jobs and prosperity are maintained will say so. One last very brief question. Scotland, the brand, as you will be aware of, there is a view that somehow we need to get a quite clear branding of Scottish products. What is your view of the made in Scotland brand? I think that Scotland has a very strong brand in some sectors and in some markets, and that should be reinforced and should be widened. I think that we have a hybrid identity in exporting. If you take the company or one of the things that I am involved in now, which is Haris Tweed, there are some places that Haris Tweed sells for being Scottish, for being Hebridean, for being British in the fashion market in particular. Above all, it has a quality of product of quality. You cannot say that the identity is what sells it or that identity is what sells it. You need them all because there are different approaches in different markets. I obviously support where it is appropriate. In some sectors in which the Scottish brand is very strong in tourism, in whisky, in food and drink, there are some things there, but there are other bits where the fact that it is from Scotland does not really matter very much at all, so you should market it on what sells it. We sell, for instance, Chanel. Chanel does not even name it as Haris Tweed. We do not use the label, we do not use the trademark. We sell it entirely on the basis of quality. You should not get hung up on which identity it is. Whatever suits the product and the market best, that is the basis on which to sell it. Thank you, Mr Rowdy. Lewis MacDonald. Thank you very much. That leads us on very neatly, Brian. I think to the question of how Scottish and British Government agencies are responsible for promoting exports and trade, how they work together, and you say some interesting things in your report. Over the piece and given the things that you found in your investigation, what is your view of the relationship as a whole, first of all? Do you think that, broadly speaking, the relationship between UKTI and SDI particularly is positive and functions as it is meant to do? Broadly speaking, yes. I think that it is positive. I think that there is mutual respect between the organisations. I have seen them working very well together. I have heard British ambassadors singing the praises of SDI and saying that UKTI should be doing some of the things that SDI does in those markets. Similarly, I have seen SDI calling on the services of UKTI. I think that there is a broad synergy that works in many cases but could undoubtedly work better. It could work better in the markets and it could work better at home. Those are some of the things that I have signposted. I think that this working group, which is now looking at that, is a recognition of it. Probably the political environment of the past few years has not been conducive to certain things out necessarily. It is now up for purely commercial and trade reasons that this will go forward well. In terms of the domestic position for companies in Scotland, considering exporting, you identify some evidence of companies not particularly being aware of the expertise of UKTI and where they function beyond the scope of what SDI works. What would your central recommendations be in terms of what UKTI could do better in the Scottish market to promote its services to a potential exporter? SDI, for excellent reasons, is a very focused organisation and it has a matrix of markets and sectors. If you fall within those markets and sectors, SDI will almost certainly do a very good job for you. However, it is a question of scale and range. Therefore, if you go, for most businesses, the first stop might be SDI. If they do not fall within the SDI category, we found some evidence that they did not get referred as they should do to UKTI. That is one way in which a gap exists. If you are trying to sell a product in a market that SDI is not represented in, then obviously what should happen is that you should be at least referred to what UKTI can offer. The other thing is that a push and pull is that a lot of the programmes that UKTI runs are underrepresented in Scotland. Partly that is because there is a UKTI perception, but that is covered by SDI and probably a slight push from Scotland saying, well, look, this is our territory and we do not necessarily want that programme here or we do not want to promote that programme here. Therefore, Scottish exporters become unaware of programmes from which they could benefit. I am not saying that these are the rule. I would like to think that there are exceptions to the rule, but obviously everybody can benefit if there is more synergy between what both organisations have to offer. However, I have emphasised in the report and I do so again that SDI does very well. Therefore, it is a case of improving the relationship rather than any criticism of SDI. That is very helpful. In overseas markets, one of the things that you mentioned in your report is the fact that there are some places around the world where SDI operate that they co-locate with UKTI or with British trade offices and others where they do not. Do you think that that is significant in a general sense or is it reasonable to say that in some markets co-location works better and in others it is not so important? I think that co-location works better everywhere than non-co-location. That is a word. It makes complete sense. For instance, just in the last year, SDI opened an office in Rio and they did it in UKTI premises. That makes total sense. There was not much space and space was made and I think that it has expanded. I am told now that our relationship works very well. However, if you have physical distance, then it is much less likely that you have a sharing of information. I quote one example where your delegation's Scottish missions were coming in via SDI, which clearly would have benefited from contact with UKTI. There was not physical co-location and therefore sometimes UKTI would hear after they had gone and there had been a Scottish mission in that they could have helped. That is just silly. If you do not have co-location, then you are much more likely to have a them and us atmosphere. It is very dependent also on personnel. You are dealing with very small numbers of people in those places. If they are socialising, if they are talking to each other, then you are much more likely to have good relationships. However, if you get any kind of stand-off, then it becomes territorial. Co-location, sharing of information, all of those things makes complete sense. Before I move to Gordon MacDonald, you mentioned in a couple of occasions the working group that has been established. Who is leading that working group and who are the members? I have only been informed of it. I am not participating. However, my understanding from the Scotland Office is that that working group has been set up involving SDI and UKTI. I think that the Scotland Office is not too sure about that. I think that there is a formal UK Government response being prepared to the review that would reflect the setting up of that working party. It is something that the committee can follow up on. One of the aspects of the review, one of the things that we look at is leadership in this area. It would have just been quite good to know who is actually leading this, but we can follow that up as a committee. Gordon MacDonald, I want to continue on the theme that Lewis MacDonald had about the relationship between UKTI and SDI. You said that you thought that it worked relatively well. In your review of the Scottish exporting situation, you highlighted that there is a London-centric approach to overseas marketing by UKTI and other bodies, which will require a conscious adjustment of mindset on the part of UK trade promoters. Last week, at the evidence that we heard from Professor Love, he said that, from my experience of working with people at UKTI, I can say that they typically regard trade support as having been devolved to the Scottish Government to administer through SDI. That is pretty much it. He then continues, that UKTI is ultimately responsible for Government trade support and it has set aside a block grant for that activity and expects most of it to be dealt with by SDI. Since your report has been produced in 2010, has there been any change in that mindset? The evidence that went back to 2010 that you took? I do not know. I think that that is what they are working on. I do not disagree with what you have just quoted. I think that it is very variable. For instance, the whole oil and gas and infrastructure section of UKTI is based between Glasgow and Aberdeen, so there is no problem in that respect. There might be complaints from other parts of Britain about that, but there is no problem there. I cannot remember if the quote that you read was specific to a sector, but a good example is the Scottish financial sector. When I was a trade minister, I always used to think it a bit odd that the Lord Mayor of London, who is the only unelected civic leader in the country, is virtually the status of trade ambassador. He trots off around the world promoting the city of London, which is fine. Obviously, I would say that there is no reason why there should not be someone from the Edinburgh or the Scottish financial sector doing the same job in the name of the UK. It is all part of the one jurisdiction for the purposes of financial services. That is the kind of area where, by habit and custom, it has grown up in one way, but it has not taken enough recognition of the fact that there are other centres of the same service that should be equally represented. You are talking more about changing a mindset than changing a structure, but there should be push and pull in that, because the committee or whatever should also be saying to UKTI that we want Scottish financial services to be represented in every part of the world. If this report or discussion serve a purpose, it is just to remind people that the way things have been done are not necessarily the way they always should be done and that we need to be conscious of wider responsibilities. I think that there are some of the assumptions that you refer to in UKTI that that has been devolved, but to be fair, there are plenty of other people in UKTI and in the embassies around the world who are acutely aware that their obligations are to every part of the UK and that it has not been entirely devolved. We will go out of their way to encourage trade missions and trade support, which come specifically to Scotland. Richard Lyle will supplementary on that. UKTI, how effective do you think it is as an organisation? I am looking at a report that was produced by the EU called Supporting the Internationalisation of SMEs. In it, it states that in terms of exporting, there is considerable scope for improving the performance of UK SMEs and it states that out of the 27 countries in the EU, 21 per cent of SMEs in the UK export as compared to an EU average of 25 per cent. When it looked at the percentage of internationally active SMEs that use financial or non-financial support, the UK had 5 per cent of exporters that had gained financial support as opposed to Austria and Turkey, who had 47 and 32 per cent effectively. Using non-financial support, only 5 per cent of exporters use non-financial support in comparison to Slovenia on 23 per cent and Cyprus on 19 per cent. How effective do you think UKTI is as an organisation? I think that all such organisations have strength and weaknesses within it and they have probably really illustrated one of them. I think that particularly when under ECGD that export credit finance was far too heavily geared towards a very narrow sectoral base, and the revamping of ECGD into British export finance is a conscious effort to redress that, and they have set aside quite a large budget for supporting SMEs. They also have people based in Scotland embedded within SDI, which I think is another innovation. I think that there is an awareness that it has to extend, but historically there is no doubt at all that ECGD was very closely geared to the defence sector and probably to the major infrastructure sector rather than to the needs of SMEs, and I think that that is something that is reflected in these statistics and needs correcting. I have the privilege of being a European reporter on this committee. On a visit to Brussels, I found that, just following on Gordon's excellent expose in terms of the contribution of SMEs, Scotland was not fully aware of the Cosmi programme, which is 2.3 billion euros for investment small businesses in the horizon 2020, and there is not a small business envoy yet, UK does, but there has been absolutely no communication, and I have to say that people in Brussels were particularly impressed by their engagement on the small business side, and yet what you are saying is that previously the ECGD had to understand a reasonable reputation. We are missing out on engagement with large markets, because we are not a member state, but because there is a lack of communication, which one gets a flavour of the garden's rosie, no it is not. Communication is two-way, and there should be… From our aspect recently, but there is nothing coming out of the way. I would be surprised if the role of the working party, which is following through on this report, did not address those. I am sure that we will read your comments, and it is exactly the kind of area where there has to be a sharing of information. One of the areas that I mentioned is the High Value Opportunities programme, which is absolutely critical. That clearly can be conducted on a UK basis. I do not want to get into the polities at all, but the UK, if you are looking at very major contracts in places in the world, the UK can make a substantial effort there. The importance of those opportunities is that there is a cascade down to subcontractors and subcontractors all the way down, and literally thousands of companies can be involved out of one high value opportunity. I was concerned about whether the information about those high value opportunities is sufficiently shared around the country, so that Scottish companies or companies in any part of the UK are aware of the potential from that single contract that is being pursued at a UK level. In exactly the same way, if there are European programmes that UKTI are aware of but are not sufficiently rolled out in Scotland, that is a structural deficiency that should be addressed. I am interested in whether the Government is a helper hindrance in that. Is the fact that we have a Scottish Government in Scotland off as the last period of being largely in conflict with each other? Do you perceive them in this regard in competition? Is that detrimental? Is there evidence of that co-operation developing? Rather than it being the UK Government's Scottish Government, but a shared interest in supporting business? I wrote this report at a time of political sensitivity. I was trying not to do was to make it attract. I hope that the report has as much relevance now as it would have done before last September. It is straight down the middle. Therefore, the deficiencies that I identified were there throughout the period that we were taking evidence, and they are still there to be addressed. I do not think that it was ever a point at which SDI at a professional level had a stand-off with UKTI. I do not think that there was probably a conscious problem that arose out of the constitutional disagreement. On the other hand, common sense would suggest that it was not a time conducive to maximum co-operation, and there were points being made about Scotland should be doing this and Scotland should be doing that. Maybe there was an attitude that we want to do them separately rather than together. You are dealing with human elements and personal views, but, in some respects, that probably did affect the past few years. There is no reason for it to affect it now. The issues that I identified are exactly the same now as they were before September. Any sensible person looking at the subject must come to the conclusion that it is better to take the strengths of both organisations. If there was a different constitutional set-up, Scotland would have a different kind of trade set-up. I would have argued that it would not be as good a one as we have potentially, because what we have now is representation in every corner of the world. However, in this situation, I am being at least as clarified, so it makes total sense for Scottish business to take advantage of both the Scottish set-up, which is good and is focused, and to take advantage of the UK set-up, which is good and is much more broadly based. It is as simple as that. There is maximum interest in co-operation rather than in any kind of conflict. I suppose that I am interested in the way in which the Government can sometimes inhibit business in somebody who does not really believe particularly in the free market as a philosophy, but it does feel sometimes that business survives despite Government rather than because of it. Is it one thing that Government at any level should be doing to support businesses to export what would it be? Is it this single portal? Is it the mentoring and being consistent or is there something else? I do not think that there is one particular thing. I think that the single portal is something that Government can drive. Every document says that it wants more companies to be exporting. I think that there is a specific target set by the Scottish Government. Therefore, a numbers game matters here. Increasing the number of companies that are exporting does not necessarily make a huge incremental difference to the value of exports, because a lot of them will be very small exporters. However, it is important for every one of those businesses and communities to meet those numbers targets. It is essential that it is made not easy but achievable for those companies. We repeatedly heard and supported my own experience that people do not know where to go. It is too confusing for them to get into exporting to start with, so they say that they will put it aside for another day. Instead of a kind of ethos of saying, let's get doing this, let's really get a push behind this, let's give it a go, there's one of saying, well for heaven's sake, we went and we saw the X and they pushed us along to Y and Y said, well we don't deal with that but you can go to the Z. It is, for many companies, that has been the experience. Not over five years or 15 years but over 50 years. It's one of exactly the same complaints that would have been found when this report was been done. As I say, I've heard the one-stop-shop line so often that I was very conscious that we need to avoid it, so I came up with another cliché instead. Maybe just finish one last point, because I think that that makes sense that people go through the one system. I think that what you say about being honest with people, what you can do at X, but you shouldn't do that, I probably kind of make sense. I wonder whether the result of a case for, you talked about the conflict with local authorities, perhaps thinking they have a role in other organisations, that for small businesses within a very local area, for example, a city-driven exporting model to support companies would make sense, but, given your own experience, it might be hardest to be slightly different, because people more than folk in the western isles get it, but there must be elements of rural remote areas that would be better supported by a more local business support. I wonder how you think that fits in with the idea of a single portal. I think that it fits in fine. The issue is that everybody knows what everybody else is doing. I mean, where it becomes daft is if you've got an SDI mission arriving in Moscow the same week that there's a UKTI mission, because they're not both going to be seeing the right people. One of them is, and I'll put my bottom dollar, it will be the UKTI one, which does. So it's about co-ordination, much more about co-ordination than saying somebody shouldn't be doing it. I'm a great believer in the city model and I've seen Glasgow and Aberdeen working very effectively in the field. I wouldn't want to shut out Glasgow or Aberdeen and say that there should be some Scotland-wide or UK-wide approach, but I would say that Glasgow should be working with SEDIs, SEDIs should be working with SDI, SDIs should be working with chambers of commerce. Everybody should know what everyone else is doing and there should be co-ordination. It doesn't seem beyond the realms of human ond onant. Maith hyn arnaw jedw'i gael efallai i sicrhau'r cynthbydd oedd y tiynau o'r llefyr nad oedd eich drafoddau gyda gyda'r lleoeddol, sydd mae'n bod yn gau'r llefyr i'r llefyr yn yr hynny oedd i'r llefyr iddynt bwysigol o'r llefyr o'r llefyr o'r llefyr o'r llefyr o'r llefyr. Felly mae'r llefyr i'r llefyr i'r llefyr o'r llefyr o'r llefyr, ac mae'n ddweud gan y squadd入neidol——to 중국 maen nhw'n penodol ac mae'n d adding Rhubinds Cymru. Ao ddim yn Rwy'n dweud y Prifysgol Siwll Aberdeen a'r gweithio fydegol ffordd i ddiddordeb chi'n ffordd i ddechrau'r company. Y clywed o'r cyfle o sgiliau deiligionを rwyf yn y cwmhobir yng Nghymru o'r Llywodraeth i ddiddordeb chi yn eu gwmwysladd,r hynny'n rwyfyrdd mwychol gwneud.Гaith yng nghymru oedd eu pwg wrth teulu arlaeddon cyllidau yn ddweudio a'r cyflinkwyd iawn i gael a'u ei wneud a'u amddangos cydnog. Yes, it's about co-ordination. Not about shutting anybody out, but SCDIs got a very distinguished pedigree and is clearly going to carry on as a body that promotes exports. It's the only one that actually depends on the support of a membership-based organisation, so if If nobody wanted it, it wouldn't be there. It also tends to adopt a more multi-sectoral approach to trade missions. I think that it's got a role, but I don't see why SDI wouldn't franchise some of its work on trade missions and so on to SDI. The main thing is co-ordination and not duplication and not reinventing the wheel. Thank you very much, convener. Morning, Brian. Brian Walson, long political career, energy trade minister, knows the working of government, inside out, I would say in the illustrious career that you had. You've said that export Scotland, so we're going to make you the chairman of export Scotland. What does export Scotland need to do? Do we need a separate HQ? Who would be based there? Who would you pull in in order to gel all these people together? Because you're correct. Everybody's working in their own resilos. Nobody's getting the message. Some companies want to export, but can't because they're facing all these different places they're going in. We all know how government works. We all know how councils work and a lot of good chambers of commerce, but I totally agree with the point you made earlier. One trade mission comes one week and one comes the next week and none of the two of them know what's happening. We've got loads of embassies. We're in the UK. We've got loads of embassies throughout the world. What would you do to establish this and how much do you think it would cost to run it? As I said at the start, if you're addressing the problem of too many organisations, you don't want to come up with a solution of creating another one. I was wary of that in saying export Scotland. I would not suggest a separate headquarters or a separate staff or a separate budget for something called export Scotland, but I would do it by reconfiguring the resource that you have already and putting an additional responsibility. I suppose that it has to be on SDI, but what I do say in the report is that it should be ministerially led, that it should be a calling to account in it, that this is actually being done. I don't want to create another bureaucracy in order to do this. What would be your overall strategy then, to drive this forward? On the narrow point, my overall strategy would be for the Scottish Government minister who is responsible for trade to say to SDI, that this is a priority. I want you to do this. I want to get rid of this long-standing problem of duplication and confusion from the personic for the business entering the system. It's an absolute priority. It's your job. We're going to give a call to export Scotland so that in every local government area in Scotland there is a place for a sign-up saying export Scotland. That's where you go if you want to start to export and there's somebody sitting there who will put you on to the most appropriate starting point. I think that that can be done without creating the bureaucracy of another organisation but by utilising the resources that are already in place. I had the good fortune some months ago to go on a visit to Taiwan, paid for by the Taiwanese Government. We met a Scottish SDI chap. He was there but he had to cover the hole. He had to cover the hole with China, down to Thailand, Japan and one guy trying to push Scotland. The main thing that he was pushing was Scottish Whiskey. He was doing an excellent job but he said, I really need help. I need more people. Should we look at the areas that we are involved in and give more help to those areas so that they can go out and see more companies? What sort of course would that be? I don't think that you would be covering China. I know that the SDI has offices in China and I think that there are plans for more offices in China. Taiwan is a great example. I know Taiwan quite well. When I was a Scottish industry minister in 1997-98, I had quite a lot to do with Taiwan because at that time 90 per cent of Taiwanese investment into Europe came to the UK and 90 per cent of Taiwanese investment into the UK came to Scotland because there was a cluster of Taiwanese businesses. There was a terrific ambassador—he was not called an ambassador for political reasons in Taiwan—a guy called Alan Collins, who was a brilliant trade ambassador and who was fully bought into that approach. That was a great example of a British embassy in all but name being very productive for Scotland. It is also a very big market for Scotch whisky and for some other Scottish exports. That is a really good example of somewhere where you utilise the resources of the embassy and you have somebody—you may have more than one—Reggie Wu, two or three people or maybe you have a stronger Scottish team, but you are working closely with the embassy. It is a really good example of where we can maximise the bang for the buck and also the benefits for Scottish business by a co-ordinated approach between the two presences in Taiwan. I would be very sympathetic for any one person trying to cover regions is almost by definition wasting their time because it is just a tokenistic presence. I think that Scottish SDI recognises that because they have this focused approach on certain markets. I have one more question. To round it up, led by the Scottish Minister, everyone feeding into that to export Scotland and basically driving this forward and possibly we could get a lot of bang for the buck. On the co-ordination side of it and the portal approach, that is what I would recommend. I would make it a priority just to clarify it. As I say, it is one point. If you looked at the telephone directory now and you wanted to know where to start exporting, would you know where to go? Whereas among all the other organisations, which now have Scotland after the name, why not one for exporting and there will be under e-export every local authority area in Scotland, that is where you go. It does not seem to me over complicated. Thank you very much. Mr Wilson, you were a Scottish Minister in 97-98 but you were back in the DTI in 2002. Did you hold the views then in 2002 that you have now? If so, did you try to influence the direction that you have put down in your report in terms of collaboration, co-operation and so on? I think that I probably did. I was involved. I was trade minister at the time that UKTI was being set up and replaced the British overseas trade board. I had a lot of dealings with UKTI in Glasgow and Aberdeen through oil and gas and the other things that they did in there. To be honest, I cannot remember whether the whole thing about co-ordination, the portal approach, I probably did not when I was in the Scottish office. My views on this have obviously developed over the years, particularly with trade ministers travelling abroad and actually seeing, you know, gaining some experience of it. If some of the review was based on a previous experience as a minister and whether or not those frustrations came out in this review from when you were a minister, it was something that you did not take forward at the time, but I wish you had. I would like to take some of it forward at the time, but I would not claim omnipotent. Can we move to Joan McAlpine, please? Thank you very much. Mr Wilson, in the challenges and responses part of your report, you talk about air links and the need for better air links. I think that we are all in agreement on that. You do not look at surface transport or sea links or ports. I wondered if there was a reason for that. No, it probably was not when it was raised as much as I am. I am not sure how much of an issue it is seen as. Obviously, I am in favour of as many communications direct from Scotland as possible, but, if we go back to the hardest weeding, everything that leaves the UK, leaves through ports in the south, it is maybe not ideal, but it is an established procedure. If there were more sea links, if there were more cargo options from Scotland, I would have no doubt that that could change. However, I think that the history has been quite difficult to sustain. That is what I wanted to explore, because we have had a submission to the inquiry from Professor Alf Baird, who is the Professor of Maritime Business at Edinburgh Napier University. One of the points that he makes in his submission is that the United Nations Trade Agency argued that seaports have a specific facilitation role in encouraging trade. You have alluded to that in your comments there. I was not able to join my colleagues when we visited ports as part of the inquiry, but I understand that, from what Professor Baird said, that this lack of a direct port connection is holding us back, and the quality of the ports is holding us back as well. I am very happy to defer on that. When I referred to air links, it was less for freighting than for personal communication, for business communication, but I certainly know that I will not, for a moment, contradict or disagree with what— Sure. One of the things that he talks about is a very unusual situation that has existed since the two Tory Governments that go under Margaret Thatcher, where the ports were privatised and they also have a monopoly. You have private companies that are owned by private equity-based overseas who are controlling our main ports and taxing the people who use them. It is almost like a private tax, which he argues is holding back business and needs to be addressed as a matter of urgency. Is that something that anyone has ever raised with you? No. Clideport is not owned by foreign equity. I know that Greenock is still a big exporter of Scottish goods, but I think that Whiskey is quite a lot else. To be honest, it is not something that I know. Gordon MacDonald Just to continue the theme, my understanding is that EU transport policy permits member states to co-finance, as they refer to it, motorways of the seas. There are tendering and subsidy options that have been taken up by Spain, Ireland, Denmark and Italy along those lines. Certainly, the information that was provided by Professor Baird highlighted that Scottish ports handle about £8.1 billion worth of freight compared to Ireland's two main ports of Dublin and Belfast, which have £90 billion worth. Has the existing situation that my colleague John McAlpine referred to where the UK Government has withdrawn from managing ports or regulating ports and given it effectively over to the market, and it is predominantly going through the likes of Tillsbury, etc? Has that been of benefit to Scotland and should Scotland have its own maritime policy? I would be in favour of promoting Scottish ports, but the ports are privately owned and run and are liverted by their commercial success. My guess would be that the use of those ports has probably gone up rather than down in recent years. Clydeport was a sleepy hollow for a long time and has probably got a much more dynamic management now than it did when it was a truss port. It is about geographical location to a large extent and cost. It is more economic to freight our product to Tillsbury or wherever and to have a short sea crossing to Europe than it is to direct it from a Scottish port. If it was not, a market opportunity would have been taken. Part of the problem may well be that, especially on the east coast, where we are closer to the continent, it would appear that fourth ports have been starving. The likes of Grangemouth have investment. We did a tour recently of Grangemouth and it is in a pretty dire state. When I asked the question what capital investment it was, I was told £2 million a year, which strikes me as a pittance. I think that we have allowed the market to allow the likes of Grangemouth to wither on the vine a bit. We certainly heard that from one of the freight companies that we visited as well that they asked for additional investment to be put into Grangemouth to make the whole operation more efficient and it was rejected. I think that something has to happen otherwise that the likes of our east coast ports are going to suffer. A cue for another inquiry. I think that ICI is doing that already. A very, very brief supplementary, Mr Rowdy. Yes, just again, going back to the European thing, £26.2 billion available for port development. Connection with Scotland and Europe? Nothing. We've got to go through the UK and it's a disgrace. Anyway, just coming back to the universities and the colleges, I mean you suggested courses. What role do you think, given the huge capabilities of Scotland's universities in developing new technologies and new products, that you seem not to be able to transfer these either directly to the market or indeed take up positions in the growing markets? What do you think the university should be doing to transfer the skills and the capabilities as if you like a Scottish on-repo to the major markets? The universities themselves, I think, could be—probably every university now has campuses outside of Scotland. They have campuses in the Middle East, they have campuses in China, they have activity going on all over the world. I think that there's an opportunity for a synergy between their presence there and the promotion of other exports. Education in itself is a big export but we could also be a tie in there. I agree with you. I think that there's a disappointing record on spin-off companies turning into successful exporters. That's something that probably the SDI is very aware of and could be working with the universities to try to encourage more of them. Once they turn into freestanding companies, they should be looking at international markets as well because, by and large, they would be in the new technologies and, therefore, they would be opening up and broadening the range of potential Scottish exports. I think that the universities probably have a big part to play in changing the culture of us, because they are internationalising themselves and, therefore, they should be helping society to think more about international trade. The other, in terms of courses and the academic approach, I know at times coming to an end, I just want to say that there's another side. Everything that we've talked about quite reasonably is about trade promotion but the other side of it is trade diplomacy, which is particularly important for Scotland. It means that our ability to export is conditioned by the relationships with other countries and our representation through international trade bodies and so on. Again, that's something in which, in most embassies of the world, you would certainly find Scots involved in trade promotion and in trade diplomacy, but it's a very separate discipline. It's a very particular discipline and it would be no bad thing if we had a cadre of people who were very aware of the very complex issues involved in the global regulation of trade. Can I bring in the very patient Mr Harvey? Thank you, convener. Good morning. I wanted to touch on a few issues around the context in which international trade takes place. Some people will always see this as a question of just more of everything, please. You used the phrase a few minutes ago, I hope not tongue in cheek, a small step forward for humankind. I'd like to think that most of us would hope that international trade actually has a wider benefit than just how much money is being made by people in this country but something that can raise up everybody's experience in terms of environmental standards, labour standards, social justice around the world as well as development in developing countries and yet some of the countries which the Scottish Government identifies as emerging high opportunity markets such as China, India and the Middle East, some of these will be places where Scottish countries developing an international presence will find it very difficult to achieve for example decent labour standards in their supply chain, decent human rights and basic social protections for their employees who are sent to these areas whether in terms of gender, sexuality, religion or other protected characteristics that they're used to seeing some protection for in this country. They may be markets where corruption is more common than in this country or where those companies are, shall we be generous and say, drawn into complex mechanisms for avoiding paying tax. What is the responsibility of government either at UK or Scottish level and the support services that they put in place to engage with those ethical, social and environmental criteria and encourage companies to take a proactive response to those issues? I think the responsibility in government is very strong and I think the corporate responsibility is also very, should weigh heavy upon them and I think to be fair does upon most certainly major companies which are involved in these kind of projects. I think the attitude to corruption is probably very different to what it was 20 years ago, maybe even more recently as a result of legislation. I mean there's really no British company involved in overseas trade is under any illusion now that they engage if they're prepared to participate in corruption, that they're not just breaking the law of the host country but they're also breaking the law of this country. I think that there is probably a cultural change that has been driven by that. Again, I think that every responsible employer, every company in this country which is bound by health and safety legislation and human rights legislation should apply the same standards in the markets that they're operating in. If that puts- If that's a specific example, are you aware of anything that UKTI or SDI or either governments do in terms of engaging with a company that's developing trade links with China to ensure basic labour standards in its supply chain? I would imagine that I know that embassies are very aware of these considerations and would certainly issue codes of practice and guidance that if a company was going to benefit from the support of a British embassy or from UKTI then they would be expected to maintain the standards of international regulation. UKTI issues codes of practice on that issue? I would be pretty sure of it. I can't speak for UKTI but I would be very surprised if they didn't. It would certainly issue in-country guidance on prevailing standards and expectations. It might be useful, convener, if we could seek confirmation of that and if such codes exist, perhaps get a copy of them before we can conclude the inquiry. Mr MacDonald is Lewis MacDonald, Global Scott. Before I come to Global Scott, I guess for completeness of the records, you'll be aware that Aberdeen Harbour is a trust port, very dynamic and successful one, which is not inhibited in accessing funds from Europe or elsewhere in its expansion plans and is a major exporting port. In terms of Global Scott, you were talking a moment ago about the importance of embassies engaging with exporters and informing them about the local situation and expectations. In your review, it's fair to say that Global Scott's was a good idea, a good network, it sometimes works exceptionally well but it's also mixed in its findings. What would your recommendations be in order to make it work even better or to make the rest come up to the standard of the best? You're right, it was probably the most complete, curious egg that I encountered. Some people had great experiences, some people had awful experiences and it speaks for itself, but what you have to do is just keep sifting the list and, inevitably, a list like that starts off with the good and the great and people who say they want to do it and then the question mark is whether they've actually done anything or whether they've done it well in the interim period and that just needs a check on that, which does happen, maybe it should happen more rigorously, but it's a really good idea. It's back to the mentoring argument that if you've got somebody in a market who is not only a source of knowledge but also a source of encouragement, source of contacts, then you couldn't ask for anything better. However, if you place faith in that sort of contact and then it doesn't deliver, then it's a big blow to morale, so it's not the principle of it's very, very good and it's purely the execution and that depends on the feedback of whether people are fulfilling their role well or whether they're fulfilling their role at all. There's no point in them being there in name if they're not doing it, so I'm sure STI'r aware of that or I think there is a global Scots organisation and it's just a case of just keep saying well thanks very much for your services but we're bringing in a few new people, that's really what it's about. If you'd been undertaking a report on UK export services rather than specifically Scotland, which I know your focus is, would you have recommended in that report do you think that something like global Scots would have a wider application? Is it something in which Scotland has a market advantage in UK terms and would others do well to learn from it? Yeah, I think so. I think there is a kind of ethos of, I think, Scottish people abroad very often want to to help someone coming, trying to emulate what they have done. I'm sure it could be replicated and of course there's also cross currents, there'll be plenty people, not necessarily Scottish people who would provide the same service. It's not peculiar to Scotland but it's the same thing, I mean I've got this title of UK business ambassador role but they have exactly the same thing and they do weed them out because if you're not doing anything there's no point in carrying the title and I think that's a sound general principle. So in a sense there is something that's parallel although it's not quite the same but the UK business ambassador has similar functions. It's not quite the same. Can I ask one other thing on the question again that I think comes up in your report around ministerial engagement with visits both inward and outward and I think particularly in relation to whisky there were some issues around whether that was as co-ordinated as it might be. Is that something that you would hope the joint working between UKTI and STI might be looking at or is it something that would need to be taken forward at a political level? Well I think it's maybe something not just the trade organisations, I think it's the it's a government level but that has to be taken you know that has to be considered. I mean it is very important on these missions or on serious missions that is led by somebody who has the status to deliver leverage in the market. I mean if you and that's what this business ambassador role does as well is it mean rightly or wrongly. I mean they don't I mean if I arrive as a UK business ambassador I don't know me from Adam but they probably don't know the minister from Adam either so it doesn't make a lot of difference but if you've got the status to do it then you create serious leverage that wouldn't occur if there wasn't someone who was recognised as a leader of that as a qualified leader of that mission. So it's very important is that ministers do it where they can deliver value and if they don't do it then there's somebody of comparable status there who can do it and again there's no point in duplication you know that it should be co-ordinated and the resources should be used in the most effective way but it is I mean that's important to the I mean you got to remember but businesses some of them without a huge amount of money to spend that they do commit if they send someone to on one of these missions they're sending someone away for a week they're paying them they're paying the costs of this they're not interested your serious people aren't interested in sort of trade tourism they want outcomes from that and therefore a government in whatever form and they don't distinguish government in whatever form has a duty to perform to deliver a serious service to them and that means creating access creating links with potential partners introducing them to the right people and so on so it's very you know these these things are important and the leadership of a mission like that is significant. I'm thinking that ministers in both governments should be co-ordinating in a in a coherent way and in a way that addresses specific markets. Absolutely there's no point in two ministers from whatever government and this would also apply to the other devolved administrations it's just crazy to have two ministers in town from the same state in the same week or the same month. You actually said in your report Mr Wilson that the Scottish office are well placed to sort of bridge this area of between the UK government and the devolved administration that being Scotland in this case. Is it still your opinion that the Scottish office should be leading this? I don't necessarily think it should be leading it but they're best placed to do this. Well I said they're best placed to provide a bridge and I think they've done that and are continuing to do it really by they did it by initiating this report and then they've done it by bringing together the SDI and UKTI to take it forward. I mean I'm probably in a fairly small minority in this room I'm thinking that the Scotland office has if you accepted if you've a de facto constitutional situation there is I think that the Scotland office should be important to to Scotland because it should be representing a Scottish interest just as the Scottish office did in the past in those areas where it's required and I do think actually that this is an area where it could perform a useful role as a co-ordinating body if you like. Whether it does that whether it is it is the only occupant of that role or not isn't for me to to say but I certainly wouldn't try to exclude it because it's we are dealing to a substantial extent here about improving the relationship or sophisticating the relationship between a Scottish body and a Scottish Government body and a UK Government body and that needs someone to make sure that that's always working in the best possible way. Okay thank you for that. I'm getting conscious of time Richard Lyle you've got a brief. I think I can be and I'll try to be brief. The Scottish Government wants to increase the value of exports we all know that we're currently a basic 23 billion I think in 2010. You've done a report Mr Wilson an excellent report what progress today has been made on the recommendations of your report and if all the recommendations in your review were implemented do you think that a 50% increase in exports aimed for by the Scottish Government can be achieved on the timescale set? I'm kind of I'm not saying this about in this specific context I'm not a great man for target setting you know I mean I've never really seen the point of it because the only point it's setting targets is it refers to something that applies once you're gone you know and nobody ever goes back and ejects you know so I wouldn't put numbers on it I just think if the right things are done then you maximise the opportunities you know you maximise you know I think it's absolutely right to try to increase the number coming in I think you have to recognise if you increase the numbers of exporters coming in then you don't necessarily incrementally increase the value of the the exports because as I said earlier such a huge proportion of Scottish exports come from from a very small number of sectors but it doesn't mean it's not important and I mean I just go back to the hardest tweet everybody's example we export about 70% of what we produce it's probably a blip on the export statistics but it creates there's over 200 people in our remote peripheral community who are in well-waged employment who wouldn't be if it wasn't for exporting now if you apply that to every one of your communities you only need one company to get kind of good at exporting and you it's transformational in exactly the same way so it's you know I'm not into big numbers but I've absolutely no doubt about the importance of this and it's really worth taking taking just playing that I know the convener has asked me to be brief has any of your recommendations been implemented and do you have any frustrations in regards to your report not being implemented? Well no I'm I'm actually delighted that it's been that the thing's been taken forward through a working group I mean that I mean I've been around this long enough not to have high expectations of the speed at which government far less governments move and it would not have surprised me if this had gone off a cliff and it would not have surprised me if because it had come from a sort of Scotland office source or been a stand-off and we're not aware not talking to you you know that's we'll do this our own way and the fact that that hasn't happened is is good and the fact that SDI is engaging with UKTI and so on I mean that will do me to to go on with and then maybe come back in a realistically I would say we come back in a year and see how much of it has been implemented then that would be the that that would be the the test it hasn't been the right political period really for these some of these things to go forward I think that it can be it can be now and I'd like to this committee is actually taking this forward at this time yes I absolutely am and that the we can all we can all feed in towards a shared objective Mr Boothie do you have another brief it's refreshing to hear somebody say the targets are wasted time rather than continuous improvement outcomes so thank you for that just just on the business tourism and the attraction of in-road investors I want to be any comment on APD which we know will change but also on the visa arrangement system that is kind of deployed by the home office the visas are a constant problem because there's a there's a conflict of interest within government and I don't it's hard usually when visa restrictions are imposed there's a good reason from one perspective which may not be a good reason or maybe a bad reason from another perspective and I don't think there's a I don't think you can adjudicate on that I think any country would be faced with the same issues that are countries where we might want to you know have a facilitate trade with through a non visa regime but there might be good security reasons why you don't want to to to lift a visa regime I know that you can generalise but all you can all I can say in this context is that the interests of trade should always be taken account of but and that there should be no you know sort of one departmental veto from another perspective the first thing you said APD well APD I was around when APD was introduced in the 90s 1990s and it's always forgotten now APD was introduced as an environmental measure not as a tax raising measure and the I mean it doesn't even have worked very well as an environmental measure and there's always I can't there was probably once it was it was predicted at the time but once it was there it would just keep increasing I live in a I think APD doesn't apply if you start your journey in the Western Isles but it just means slightly cheaper flights which is a good thing but whether it's a good thing from a social point of view whether it's a good thing from an environmental point of view might not be so obvious and to be honest I don't think there's a huge difference on a trade point of view do you sorry if I held it to ask do you Mr Harvey do you want to brief supplementary yeah on APD a lot of the rhetoric around the Scottish Government's position till now has been for a halving and then a scrapping of APD if and when it gains the power and the Smith proposals on the legislation that flows from that seems to imply that that that would happen the new economic strategy actually reframes it and says that they want to replace APD with a different tax do you think it's possible to achieve a tax regime for aviation which both increases the connectivity which is what the Scottish Government says it wants to do and decreases the environmental impact of aviation and if so how it's not a question I pondered but it's like my my kind of instinct is that you know APD is not as big an issue as I don't think APD I think APD has been a it was introduced it was introduced as an environmental measure under the guise of an environmental measure anyway and it's essentially become a tax and how much of a deterrent it is to flying doesn't seem to me to be very obvious because flying continues to increase and there's such variation in airfares that you can you can book across a huge range of prices which aren't affected but they're affected by factors other than APD so I don't if I was inheriting the APD responsibility then I'm not sure I would want to transfer APD to some other tax tax because someone's going to be taxed to pay for getting rid of APD so it seemed to me to be much more of a gesture but a substantial benefit for anything but I really do feel I'm getting outside the terms of it. No other member has indicated they wish to come in at this point so can I thank you Mr Wilson for coming in and I think it's been very informative and I think the review in itself made extremely interesting reading and it's something that obviously this committee has welcomed in taking forward this evidence session that we're doing and just for the official report can I extend the Murdo Fraser's apologies for not being at the meeting today he's engaged in another meeting in Brussels therefore that's why I'm convening today's meeting and I now close this meeting and we're going to private session