 The next item of business is a statement by Jenny Gilruth on Caledonian sleeper train. The minister will take questions at the end of her statement, so there should be no interventions or interruptions. I call on minister Jenny Gilruth up to 10 minutes, please. For over 150 years, a sleeper rail service has run from Scotland to England. The current Caledonian sleeper service is 43 Scottish stations, including the UK's most remote rail station career, which is also the highest in the UK. From Montrose to Cercodi, from Créan Larrach to Fort William, the sleeper is about more than just Scotland's cities. It allows communities across Scotland a service to access London and beyond. Earlier this year, I undertook to provide Parliament with an update of the successor arrangements for the Caledonian sleeper. That follows my decision not to rebase the franchise agreement with Serco last October. Today, I can announce that, from 25 June this year, the Caledonian sleeper will be provided by an arms-length company of the Scottish Government, in line with our operator of last resort duty. That means that, from the expiry of the current franchise, Caledonian sleeper services will be provided within the public sector by an arms-length company owned by the Scottish Government. That will provide stability and certainty for passengers and staff and place the operation of Caledonian sleeper services in public hands from the end of the current contract. I am confident that, under those arrangements, we can build on our experience of public sector operation to ensure that the bright future that we see for the Caledonian sleeper is protected. My predecessors in this role took the decision to separate sleeper services from the ScotRail franchise, and I stand firmly by that forward thinking. The step forward that was taken by this Government in how sleeper services were specified allowed the level of dedicated management for this historic service that it deserves, leading to rejuvenated service and the specification and delivery of an entirely new fleet of trains. Indeed, the sleeper has surpassed any other train company in the UK in its recovery from the pandemic, its revenues over the last year outstrip pre-pandemic performance and its forward bookings are stronger than ever. Even a brief snapshot of bookings in January and February shows the highest rate for forward bookings at any stage of the franchise. In the Caledonian sleeper, we see a service that is now thriving. That is a testament to the quality and attractiveness of a service that continues to exceed passenger satisfaction targets. It is also a testament to the staff that provide a world-class service to those using the sleeper. To the teams of staff in the depots who ensure the highest quality of operations to the drivers who ensure that passengers arrive at their destinations safely and on time and to the cleaning staff who take pride in the presentation of all that the sleeper represents. In recent times, the Caledonian sleeper has adapted in a post-pandemic market to attract a substantial tourism footfall. Indeed, travelling on the Caledonian sleeper has become an experience in itself promoting small Scottish businesses through food and drink on board, for example. As members will recall, late last year, I took that decision not to accept the rebasing proposal that was received from Serco Caledonian sleepers Ltd. As a consequence of that, the current franchise will end on 25 June this year. I must repeat today that the decision not to rebase was in no way a reflection on the quality of the product that has been developed nor on the commitment of the staff who deliver the service every day. As I have already stated, the sleeper is a highly valued and iconic rail service with a dedicated management and delivery team, providing excellent customer service and passenger experience. Rather, the decision that I had to take on rebasing was a question of the terms of the rebase offer and that, in the Government's view, those terms did not represent the best value for money. Since the rebase decision was taken, my officials in Transport Scotland have been analysing the full range of options available for the continuation of services once the current franchise comes to an end. As we have undertaken our analysis and considered options, it is right that I remind the chamber that, for the current time, rail powers remain largely reserved to Westminster. Scottish ministers have made repeated calls for the full devolution of rail powers. That would give ministers in Scotland a much more radical range of powers to enact change and unleash the full potential of Scotland's railways, bringing together track and train in a cohesive and an integrated manner, and also fully accountable to Scottish ministers. Reform of the railway itself is necessary and long overdue. It is worth saying that this is not only a view held by Scottish ministers. Keith Williams, who led the UK Government's own rail review process, has said publicly that franchising cannot continue in the way that it is today. However, the reforms proposed by the UK Government do not go far enough. Indeed, there is continued uncertainty regarding the pace and the impact of those proposals. The William Shapp's plan for rail was published back in May 2021 and proposes that a new public body, the Great British Rail, be established to run and plan the rail network. That body would effectively replace network rail over which the UK Government retains responsibility for the current time. However, it is not at all clear how it is intended that that should work in relation to rail services such as the Calisliper and ScotRail services, which ministers in Scotland are responsible for. Nor is it clear in relation to rail infrastructure in Scotland, which the Scottish Government funds. Not only that, it is at present very unclear when any of the proposals that are set out in the plan are likely to be implemented. Despite that uncertainty, with the sleeper franchise coming to an end in June of this year, I am required to make my decision about successor arrangements in accordance with the current UK legislative framework and the Scottish ministers' franchising policy statement. The detailed consideration of the options that are available to provide Caledonian sleeper services beyond June this year has taken place in accordance with UK railway legislation. The decision is also set against the background of substantial uncertainty about future market conditions with post-pandemic recovery, the on-going cost of living crisis, wider economic instability and continuing uncertainty regarding the pace and impact of the UK rail reform process. I have already informed Parliament that I do not consider that the prevailing conditions in the UK rail market and the wider economy would enable the pursuit of a competition for the re-letting of the franchise at this time. I have also carefully considered the possibility of a direct award contract to circle to continue to run services beyond June 2023, in particular how that option would align with our revised franchise policy statement and policy objectives. Based on those considerations and against the background conditions that I have outlined, I have concluded that a direct award to circle would not be appropriate. A key role undertaken by my officials in Transport Scotland is to ensure that I can fulfil my duties under section 30 of the Railways Act 1993 and deploy the operator of last resort arrangements should they be required. I can therefore confirm that, from the expiry of the franchise, Caledonian sleeper services will be provided by the arms-length company owned and managed by the Scottish Government. That is in line with our duty in the absence of a franchise agreement to provide or secure the provision of sleeper services and is referred to as our operator of last resort duty. The decision will provide a stable platform for the provision of sleeper services and it will also provide certainty for staff and, of course, the travelling public. I would like to make it very clear that the Caledonian sleeper staff will transfer to the Scottish Government-owned entity with their terms and conditions protected. Due to the lack of clarity from the UK Government in relation to rail reform proposals, I am not able at this stage to confirm how long I expect operator of last resort arrangements to be in place. That will be considered further as market conditions develop both in terms of the rail sector but also the wider economic conditions that prevail. It will also have to take account of the pace and impact of UK rail reform when that becomes clearer. In closing, I want to take this opportunity to pay tribute to every rail worker across Scotland today for the role they play in making Scotland's railways a success. We cannot make our railways a success without you and we cannot encourage people back to our railways without your support. In taking the approach that I have outlined today, we will secure the stable delivery of our historic Caledonian sleeper services under Scottish Government ownership, giving certainty for passengers and for our rail staff. Rail travel is good for our economy, helps to deliver our net zero ambitions and it creates a greener Scotland for all. The Scottish Government's vision for rail is a thriving industry, one that meets the needs of passengers and is sustainable in the long-term future. The Caledonian sleeper is a core part of that vision, which I am sure will only continue to flourish. The minister will now take questions on the issues raised in her statement. I intend to allow around 20 minutes for that and then we will move on to the next item of business. I would ask those members who would wish to seek to ask a question to please press the request-to-speak buttons and I call Criam Simpson. Thank you and I can thank the minister for advance sight of her statement. When we debated the future of the sleeper last month, I pointed out how successful the service had become under Serco. The year saw the highest revenue since the start of the franchise with guest levels back to pre-COVID levels. Performance, guest satisfaction and employee satisfaction were all going up. The minister has just agreed with all of that. She has just said that the sleeper has, in her words, surpassed any other train company in the UK in its recovery from the pandemic. She says that we see a service which is now thriving. She calls it a world-class service. There can be no other conclusion other than that this is an ideological decision. Jenny Gilruth said nothing about how this world-class service can be improved under the Scottish Government. She has made no case at all for this decision. If it is about value for money then perhaps she can answer this. Has she requested or received a costed proposal from Serco for a direct contract award? If she hasn't, which I suspect is the case, how can she claim or demonstrate that she is demonstrating value for money for the Scottish taxpayer? I want to start by setting out the limitations of Scottish ministers in responding to the required legislation. Legislation, of course, is reserved to the UK Government in where his party is in power. Some of that relates to the on-going challenges in relation to the detailed assessment of the options that have been considered in the framework. Ministers in Scotland are required to, under the legislation, consider direct award, as the member has outlined, but also to rule that out if it is not feasible. Of course, direct award was considered by my officials, but it was ruled out. Mr Simpson knows that rebasing was similarly ruled out because it was presumed that it was not value for money. Additionally, it is worthwhile noting that Scottish ministers do not just have to have regard to the reserved legislation that I have outlined. We also do not need to have regard to the Scottish ministers' franchising policy statement. If Mr Simpson would like to do so, he can access that statement on the Scottish Government's website. However, factors that I am required to consider as a minister include alignment and integration of our rail services. Having ScotRail, for example, and now Caledonian Sleeper under the same umbrella brings that integration, and the ability to respond quickly to rail reform, while there is great uncertainty. I do not know what the UK Government is going to do next in relation to the William Shaps review, because it has not come forward with any legislation as yet. Lastly, there is consideration of value for money. On all those factors—and, underlined by the fact that the legislation is reserved—I do not accept the picture that Mr Simpson has painted in relation to how the decision was reached. However, if Mr Simpson will allow me to speak, he is heckling from a sedentary position. He makes a point in relation to the success of the sleeper. I absolutely accept that, and I acknowledge that in my statement. I acknowledge that in January when we had a member's debate on that very subject. However, I am required, as I have outlined, to consider the necessary legislation. I think that there is a real opportunity here for us in relation to the delivery of sleeper services in the future. The UK Government is actually a fan of public ownership in the railways these days. In 2021, I think that the south-east term was brought into direct public control, so was LNER in northern. The UK Government has also offered a stay of execution to Avanti, which is somewhat bizarre, given the pure service that has been delivered in the west coast, but none the less. The service that is being delivered by TransPennine, of course, is being critiqued by the UK Government's own rail minister, who said that performance is clearly unacceptable and that the operator needs to turn it around. I hope that Mr Simpson will welcome the news for Caledonian sleeper staff and for the taxpayer in Scotland. Of course, had we gone down the road of running a competition, I am sure that Mr Simpson might have been in the chamber today critiquing public expense associated with that. I thank the minister for advance sight of her statement. Over recent weeks, we have become used to hearing a lot of bad news from the transport minister, so it is a relief to hear positive news today. It is welcome that the Caledonian sleeper service is to be publicly run from June, and I want to praise the efforts of the RMT, ASLEF, UNITE and the TSA who have been instrumental in making the case for public ownership. We do fundamentally disagree with the minister on the decision to split ScotRail and sleeper franchises. It was wrong in 2015 when the SNP made that decision and it remains wrong to split those services now. Does the minister not see the benefits of a unified ScotRail operator delivering both when she says that she is concerned about fragmentation and current structures are already overly bureaucratic? Does the minister not accept that cross-subsidy is another reason why we need one unified ScotRail operator to make the service more affordable? Finally, it can cost over £500 for a family of four for a return from Glasgow to London, and that is with a family rail card. It is ridiculously expensive for people and for businesses to surpass any other rail service when it comes to fares. So, to make the most of this positive step, what changes are planned by the Scottish Government to make this service more affordable? I thank Mr Bibby for his question. I very much welcome the collegiate support that he has shown today for the action from this Government. Indeed, it was not long ago that Mr Bibby's former boss was heckling me back in January, suggesting that this would not be the approach that the Scottish Government would take. I very much welcome the Labour Party's warm words today. In relation to Mr Bibby's question on splitting ScotRail and sleeper, of course, that was a historic decision that, as Mr Bibby alludes to, dates back to 2015. The most important thing now is to provide certainty and clarity. That is what OLR arrangements allow us to do. It is really important for staff involved in this as well that we provide that. In relation to expense, I would broadly agree with the member's assertion. The member will know that, of course, in Scotland our fares are on average about 10 per cent cheaper than in other parts of the GB network, and, of course, we will be removing peak fares. Again, another thing that has been welcomed by our real union partners later this year, which I think is really important, because we need to facilitate model change. We need to get folk out of their cars and on to public transport. The only way that we do that is by making public transport more affordable. I think that the point that the member makes in relation to expense is a fair one, and it is certainly one that I am keen to work with, Caledonian Sleeper, as we move forward with the new arrangements. I ask the minister when will the two-pay transfer take place. What does this mean for employees and what engagement has taken place with real unions? I thank the member for her question. I want to provide an absolute assurance to Caledonian Sleeper staff today that they will be able to transfer to the new entity with their terms and conditions protected. The two-pay transfer will take place on 25 June, which is when the current contract ends, and discussions will begin imminently with staff and unions directly from today. I have listened to the calls, as I mentioned, in response to Mr Bibby, from our real trade unions to nationalise the Caledonian Sleeper. Of course, the unions campaign for public ownership of Scotland, and I hope very much that they will welcome this decision today. I meet with the real unions on a regular basis as transport minister, and I look forward to engaging with them on this important decision as we look to make public ownership a success for Scotland. In turning the sleeper into the exemplar that the minister has described, Sarko made a loss of over £60 million over the duration of the franchise. How does the minister plan to ensure that the franchise turns a profit, to ensure that the taxpayer is not picking up £60 million losses going forward? And can she promise that she will not cut jobs and salaries, services, maintenance or put up prices to do so? I thank the member for his question. I think that the figures he has outlined say have been widely reported in the press and actually relate to the historic decisions taken by Sarko. I would just also emphasise that the Scottish Government provides substantial subsidy to Sarko to run the current contract. I think that that is worth putting on the record. Of course, in relation to jobs, as I outlined, I thank my response to Audrey Nicholl, all jobs will transfer under their current terms and conditions. There are no proposals on the table for any job losses today, and I just wanted to make that clear. Ministers talked to the fair bit about the operator of last resort and why that has been the right decision. I just wonder if she wants to expand on that any more. Particularly what the kind of timescale going forward is, because are we totally dependent on Westminster, and have we no indication of when they might legislate? The decision regarding successor arrangements for sleeper services, as I mentioned in one of my earlier responses, has been taken following that detailed analysis, which included a direct award to Sarko. However, that analysis was conducted in accordance, as the member has asked, with the current UK legislative framework, which is reserved, and, of course, our franchising policy in Scotland. That requires me, as Minister, to look at the process. We have to look at whether or not a new franchise contract competition is required, which was ruled out, as members will recall. Then consideration of a direct award, of a franchise contract, of a suitable contractor, which was ruled out due to market instability. Only if one in two have been decided against an operator of last resort mobilisation can be deployed. We are curtailed in relation to the legislation at the current time, due to it being reserved to the UK Government. However, there is an opportunity, of course, that the member and I will share in this regard, to do things differently if those powers could come back to Scotland, and we could have power over all of our railways to have that real integration that we need to see right across the network. I remind members of my register of interests. Today is a red letter day, so can I ask if this is a decision that has been taken to and ratified by the whole cabinet? The pay anniversary for staff on the Caledonian sleeper is 1 April. The circotemporary measures agreement does not end until June. The Scottish Government must therefore sign off any pay award for this year, so will the minister commit today to a fair pay award for those staff this year, and will she commit to direct negotiations with the trade unions over pay and conditions once it is back where it belongs, where it should always have been in public ownership? I thank the member for his question. I think that his first question is in relation to Cabinet. Certainly, of course, the First Minister signed off on this approach, and Cabinet members will be aware, as I know that it would have been discussed at Cabinet. I am a junior minister, so I do not attend Cabinet, but my Cabinet Secretary will have brought the matter to Cabinet's attention. On his second point in relation to the pay award, of course, he knows that I spent, I think, the first six of my time in this job, meeting with railway unions on a very regular basis. That was actually really instrumental to my experience in this job and to forming good relationships with our railway unions. I think that that is hugely important. Of course, I am more than happy to meet them. I do so anyway on a regular basis. Direct negotiations would be a matter now, of course, for the new entity. However, I will be more than happy as transport minister to meet with the railway unions, and I am sure that we will be meeting as a result of today's decision in the near future. I am delighted with the news that the Calais sleeper is to be brought into public ownership and with the overall continued nationalisation of Scotland's railway. I hope that that will provide the opportunity for the sleeper service to be made more attractive to and useful for my constituents in the Highlands and Islands, rather than the sole focus being on Londoners getting to come up and enjoy my region. Particularly given the history of near empty trains being run on the southbound journey from Inverness, can the minister tell us whether any consideration has been given to how journeys and opportunities that the service creates can be marketed to Highlanders? I think that the member makes that a really important point. Of course, the Calais sleeper reaches lots of different communities. It is not just about the central belt. I alluded to some of the places. There are 43 stations in total in Scotland that the Calais sleeper reaches. Parts of the rail network reaches roads that are not able to, but more broadly, the member makes it an interesting point. With the current franchise coming to an end at the end of June, we have an opportunity to look again at the delivery of services, but services to the Highlands are already very heavily used, as the member will know as a local MSP, and they are highly valued by passengers irrespective of where they come from. However, if the member has ideas on what more we might be able to do under OLR arrangements to promote the service and I would be happy to meet with her to discuss it, in the meantime, we will continue to promote Calais sleepers' contribution to tourism in the Highlands and as a sustainable form of transport to and from London. Calais sleepers are the greener option by miles, but travelling on it has often been significantly more expensive than travelling by plane. Rather than a luxury service, we need cheaper fares with a quality service. Public ownership of the sleeper might be the way forward, but the Scottish Government's nationalisation of ScotRail does not inspire confidence. How is the Scottish Government going to ensure the sleeper is the greener, credible and competitive means to travel? I am sorry that Ms Wishart is not inspired by Public ownership of Scotland's railways. I use it regularly—I do not know whether she does—but I find it to be in the main very efficient—one of the most efficient railways services in the whole of the United Kingdom. On the point in relation to expense, as Mr Bibby alluded to, I am sympathetic to the member's point. Obviously, under the Circle franchise, the development of the approach that they have taken has been more focused on tourism and on luxury products. That might be different in the future. I do not want to prejudge what that will look like, of course, but that is the approach that the Circle has taken. The Circle has been successful, as I alluded to in my response to Mr Simpson, in driving up an increase in tourism. It is important that we do not lose the benefits of that approach, but her overall assessment in relation to expense I am very sympathetic to. We need to make public transport irrespective of mode more affordable, so we will absolutely require to look at that opportunity in more detail under the new arrangements. Minister, you have highlighted the strong performance of the Calais sleeper. Can you outline how that will continue under the operator of last resort governance? Jackie Dunbar raises an important point here. The sleeper has been performing very well, as we have been discussing, and it is important that we use that success as a barometer to build on under those OLR arrangements. The new arrangements will provide stability and certainty, as I mentioned, for passengers and staff, which is really important, and it will allow us to move forward with public ownership from the end of the contract. The main way in which we build on that success to my mind is through the staff, because it is the people behind our railways that make them successful. I am very confident that under those arrangements we can build on our experience of public sector operation to ensure that bright future that we all want to see for the Calais sleeper is protected, while, of course, we wait for clarity from the UK Government regarding their rail reform proposals. I am delighted that the Government is able to deliver an integrated, publicly-owned ScotRail, now complete with the world-class sleeper service. Alongside the rail unions, we have been clear from the start that a nationalised sleeper service is central to our vision for people's ScotRail, including delivering that climate critical shift from plane to rail and also better connectivity with our friends in Europe. Does the minister agree that, with a nationalised Calais sleeper, we are one step closer to a fully integrated, affordable rail route from Scotland to mainland Europe? Broadly, I agree with the member's assertion that there is a real opportunity here for that more joined-up approach to transport, not just within Scotland, of course, and that the sleeper gives us greater opportunities in that respect. Nationalising rail services and extending service to Europe would require full devolution of rail powers to Scotland, so I would call and ensure that, as Mr Ruskell would support for those rail powers to come back to Scotland and for those with a genuine interest to get behind calls for those powers to be devolved to Scotland to allow us the opportunities that are presented to us in relation to the OLR opportunities. How much have the arrangements to implement operator of last resort cost the Scottish taxpayer to date? Can the Scottish Government afford to run and improve the Caledonian sleeper? I have instructed officials to proceed with the implementation of OLR arrangements, as I outlined in my statement, and the final costs will be published in due course as part of the normal government accounting processes. More broadly, we have made available the funding that would be considered appropriate to continue and to maintain support for the net cost of running of sleeper services. Thank you, Presiding Officer. I am just sat here trying to digest that. We have the highest service of the high standard, thriving, attractive, exceeding passenger expectations, so we are nationalising it. We do not know the costs. We have no idea of the costs, but we are taking that action before we do. What we do know is that ScotRail costs us north of £1.3 billion a year. How can the minister make this move without knowing the cost? Does she at least have an estimate, even if you do not know what the exact ones are? Doomingloom from Mr Mountain. Unfortunately, he cannot recognise that I am curtailed as a Scottish Minister by reserved UK railway legislation that I have to adhere to as a transport minister. Now, if Mr Mountain does not like it, I suggest that he get behind calls to devolve those powers back to Scotland to give me full powers over Scotland's railways. I refer to my entry in the register of members' interests. I warmly welcome that Caledonia's sleeper will be publicly run and note what the minister has said about the length of the arrangement and the UK Government review. The ScotRail contract is for five years plus the option to extend for five more. Does the minister agree that it would be preferable for there to be the certainty on the length of the contract with the Government-owned arms length company? I agree with the member's sentiment and, obviously, in relation to the sleeper, there is uncertainty in relation to where the Williams Shaps review will go next. That uncertainty will also extend in relation to the delivery of ScotRail services that will be impacted by any decision that the UK Government takes. I am sure that the member would agree with me that we need to see the UK Government coming forward with those plans. I do not feel as minister that I have been adequately consulted at all in relation to what those plans will mean for Scotland. Really, the way around this, of course, is to devolve rail infrastructure back to Scotland to give us full powers over our railways. I do not know if Mr Bivvy supports that or not, but that would actually allow for greater accountability of the Scottish Government. I am sure that the Labour benches would welcome that. I call on Jimmy Harca-Johnson to be followed finally by Douglas Lumson. I ask the minister whether the decision to take the contract back under Government control will incur any compensation or further contractual payments to Serco. I am not aware of any contractual requirements that would allow for that, but I am more than happy to check with Transport Scotland officials and clarify that with the member. If Serco lose millions running this service at near capacity, what will a state-run service do differently so that those losses are not borne by the taxpayer? Obviously, Mr Lumson would like the service to be a success. I am sure that he would join me in that sentiment. We will work very closely with the staff at Serco who will be tupping over to the new OLR arrangements and, fundamentally, making a success of the Caledonian sleeper railway depends on the staff who work on our railways. I very much hope that they will welcome that decision today. That concludes the statement, and there will be a short pause to allow front-bench teams to change positions that they wish.