 Felly, ddweud i ddweud i gael gwrth iawn a'r Cymru ein chyngmyddiau yn 28 mewn i gael y gyr�out. Rydym yn digwydd bod yn ei ddweud fyddai'n myfyr eich cyfnod ar gyfer yr arbennod gyfer y ddtau eich hwn. Mae gwaith yn gwneud fath gennym, a pan gennym i Fyrdd Jamie Greene. Mae hynny'n gawr i Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel Gwiel P flynghau gweithio ar gyfer y gwaeth i gael gyrus. The committee has asked to consider taking item 7 at any future review of the evidence that we have heard at that session on the South of Scotland enterprise bill in private. Are members agreed? Yes. It's agreed then. We are now going to move on to the South of Scotland enterprise bill. This is our first evidence session on the South of Scotland enterprise bill and the committee will now take evidence from the Scottish Government bill team. I would like to welcome from the Scottish Government Karen Jackson, the South of Scotland economic development team leader, Sandra Reid, the bill team leader, Felicity Cullen, the Scottish Government legal directorate and Fraser Gough, the parliamentary council to the Scottish Government. We have a series of questions for you this morning and I'm sure you're well versed in how this works so that the microphones will light up for you and if you catch my eye I will try and bring you in at the relevant time. Of course, there's a danger on this committee if you look the other way when a question is raised I'll just have to point at the person who doesn't look away fast enough. So the first question this morning will be from John Finnie, John. Thank you. Good morning panel. I wonder if you would be able to outline for the committee the extent of the Government consultation on this, particularly with regard to businesses, communities, individuals, councils, trade unions, third sector organisations and what the key messages raised during the consultation process were. I'm particularly interested if the question of the social development element of the was picked up because of course that's what would differentiate it from the existing arrangements. Karen. I don't need to press a button though, it just can't work. You don't need to press a button, it lights up for you, in fact it's already lit so you're on air. Brilliant. Thank you very much. I think it's fair to say that engagement has been a really key part of our work throughout developing the proposals, both formal and informal. The Scottish Government's pre-legislative written consultation ran for three weeks in March between March and June and we received a really good response. We got 268 respondents to that written consultation. It was a really good mixture so we got 115 responses from organisations and the rest from individuals. Again, a really good spread, both of people are really interested in that organisational coverage as well. We complemented that written consultation by events across the south of Scotland, so we ran 26 events across the same period and the national economic forum took place in Dumfries at the end of May as well, so again that brought in businesses. That consultation built on previous consultations that we had during the enterprise and skills review. The engagement with stakeholders has been a really important bit of our work. You asked a little bit about the themes that were coming out of the consultation. Yes, the key messages, please, and particularly whether social development was picked up on a week. We've obviously published the summary of responses, so I won't go through it in too much detail. Essentially, people were really focused on ensuring that the south is an attractive place to visit, to live and to work, looking at how we created better employment opportunities and better paid jobs, recognising that the south of Scotland had a very different economy, so the business space was different and the new agency needed to respond to the needs and opportunities there. There was a real focus around young people, clearly the south of Scotland is facing young people moving out, so lots of comments about what we needed to do to help young people create new opportunities there. Picking up on the community's piece, there was a real theme coming through around recognising the strength of communities in the south of Scotland, their resilience is strong and the new agency can do something to help that, and then we've picked that up in the social element of the remit of the agency, so absolutely a key point there. The other themes were around the sectors that were important in the south of Scotland, so recognising that the economy is different, there are certain sectors that are like forestry, tourism, creative industries, not an exhaustive list, but that the agency can pick up on, and then, as you can imagine, there are issues around connectivity, both physical and digital. Can I push you again on the issue of social development? The situation in the Highlands and I represent the Highlands and Islands, as does the convener, is that historically that was seen as a hugely important part of the HIDB and then HIE's work. That emphasis seems to have changed. With a new organisation, it's not just about the economics, it is about the social. Can you say the extent to which that will feature in the work, please? If you look at the overarching aims of the new agency, that absolutely picks up on the fact that the new agency will promote as well as the economic development of the south, the social development of the south, so absolutely we see that as integrated. We're looking at places, businesses and communities are equally important in place, and the new agency will bring that together. Okay, thank you very much. Looking ahead, the anticipated timetable should the legislation proceed. When will the chair and board be appointed? When will an action plan be published? Where will the headquarters be? Gosh, there's a lot in that question. Or when will it be decided then, rather than where? As he started out, assuming that Parliament approves the legislation, in terms of the timetable for the chair, we hope to start that process as soon as Parliament has approved the principle of the bill, so when we reach the end of stage 1, that should then let the public appointments process run so that ideally we'd have a chair in place towards the end of the summer. You asked about decisions around location. A plan? The plan will be for the new agency itself to publish, so we'd expect that to happen after the new agency came into force. Again, if Parliament approves the legislation, we're expecting the new agency to be established on 1 April 2020, so the action plan developed and approved after that. Around location, the consultation is really clear that people wanted to see the agency everywhere, accessible to all. They thought that one single headquarters was really the wrong way to go, so we're looking at how we ensure that we deliver that in practice, so that co-location point around public agencies. Again, we've not set a timetable for that, but that work is progressing at the moment. A work to proceed, the timeframe in which the board would be appointed, you'll have the chair first. I'll have the chair first and then we'd assume that the chair would have a role in the appointments process after that, so ideally we'd have the members in place before 1 April 2020 ready to start when the agency is established. It would be quite a tight timescale to get everyone in and all locations. The next question is from John Scott John. Thank you, convener. Good morning. Just continuing in that theme, why is primary legislation required and what are the benefits of this approach compared to other available options? This is the dangerous part where you all look away. Sandra, do you want to lead off on that? I'll take it if that's okay. Sorry, I was just looking for my bit of paper to tell me all about legislation. Again, the bill is implementing decisions that came from the enterprise and skills review. Through that review we looked at various different options for a structure of a body, not just legislation but also lots of other options. We looked at whether it should be a partnership that wouldn't require primary legislation but would be supported by a member of understanding. We looked towards the local government legislation, whether it should be a joint committee under that legislation. We looked at whether it should be a company owned by the public sector or whether one of the existing public agencies in the south of Scotland could deliver it under a separate branch. The conclusion was absolutely that the new public body was the right way to go. A real consensus developed during the enterprise and skills review that primary legislation was right. We assessed all those different options against different principles and the agency and legislation scored best against them all. We decided that that was the most ambitious way to go. It would deliver the transformational change that everybody wanted to see. It would be independent and it would be able to employ its own staff. There would be a clarity around its budget and it could pick up and support both businesses and communities with that wider remit. The legislation would define a really clear remit and people would be able to engage with it. It also had the benefit of being able to be part of the national structure of other enterprise agencies. We thought for all those reasons that legislation was the right way to go. That is very clear. What historic social, economic and cultural reasons are they for treating Scottish Borders and Dumfries and Galloway differently to other areas south of the central belt? For example, parts of South Lanarkshire and Ayrshire, and I declare an interest as a resident of South Ayrshire. For example, what parts of South Ayrshire, south of Gvern, which is a natural fit into this whole area and was disadvantaged before under the leader scheme, not the leader schemes but the ones in the 1990s, when Stuart Stevenson at that time actually tried to get the area south of Gvern included into that part of the south of Scotland for special treatment. If you want to give me the reasons why you chose the areas but why you decided to disadvantage other areas perhaps, although it is not my constituents. It looks like it is you as well. I am very happy to take that question. The boundary issue is one that we have been exploring for quite a long time. As part of the enterprise and skills review, we looked at how you might define the south of Scotland, and there were various options we had there. We looked at whether it should mirror the south of Scotland parliamentary region, which brought in a range of different local authorities, or whether it should pick up on the southern Scotland nuts 2 area, which I am happy to write and define what that is, but it brought in a lot of different local authorities. The focus was on the two council areas. The consensus during that period emerged that the two local authorities, the Scottish Borders and Dumfries and Galloway Council, were the right way to go. That reflected the economic challenges faced by those two areas and the opportunities that they had. It could offer a real focus on tackling those challenges. We also emerged that it was much clearer for businesses and communities if they knew exactly which agency to go to. The other definitions would have been much more confusing for the service user. It also recognised the work in the local area. The South of Scotland Alliance was already a partnership of those two local authorities, so it was building on that local stakeholder engagement. Similarly, those two local authorities have come together to build that partnership. We thought that the focus on those two areas was built on the work that was going on locally. Aesha and other bits of Scotland have been interested, but during the consultation, they supported the boundary that we were developing. Both Aesha and South Lanarkshire were the other areas. There are two other structures. Aesha has a growth deal structure that they are looking at. South Lanarkshire is part of Glasgow, the city region deal area. We are not creating an island, so the legislation is very clear that the new agency can work across its boundaries looking at other local authority areas and also in England, so that it benefits the people of the South of Scotland. You get that alignment of purpose. The boundary is notwithstanding that the two local authority areas are loosely defined then. Is that what you are saying? The definition of the boundary is the two local authority areas. The Scottish Board is counselling and Freeson Galloway Council are the two local authority areas of the geography. The agency will be able to align and co-operate with organisations outside that boundary to benefit the people of the South of Scotland. I am familiar with those boundary issues because my constituency straddles Highlands and Islands and Scottish Enterprise. In other words, I am partly in Murray and partly in Aberdeenshire. I just wondered if Scottish Enterprise will retain responsibility for South Aesha and other adjacent local authorities. Will they be taking particular actions to collaborate with the new body for the South of Scotland to ensure that the neighbouring areas are not disadvantaged in a way that there might be areas of difficulty today, but those difficulties do not become greater because that would appear to be necessary to do at the boundary areas? That. In relation to Scottish Enterprise, as Cairn said, the new agency's remit is within the South of Scotland area, but we expect to collaborate with other agencies, including Scottish Enterprise. As it does that, the new agency will focus on regional economic activity within the South of Scotland, but collaborate with Scottish Enterprise. We expect to remain a national agency, but they will work together to ensure that we achieve the aims. Forgive me, but that is what I would have expected you to say. I want to draw you closer to the specifics that will Scottish Enterprise take any particular action to support areas that are adjacent to the new area. At the boundary, differential policies can, within just a few hundred metres, create difficulties that come from administrative decisions. I just wonder if North and East Ayrshire and South Ayrshire and other bordering authorities particularly focus on making sure that that does not happen, because we have disadvantaged areas north of the new proposed area. I picked that up. Scottish Enterprise has been engaged in the work that we are doing around regional economic partnerships. I know that you are hearing from Scottish Enterprise in two or three weeks' time, so they will be able to give you more detail on their work around what they are doing to align in other regional areas. With their new chief executive, they are looking at their regional approach and how they tailor their responses to other parts of Scotland. That needs to lead on to the next question from Maureen. What do you think Scottish Enterprise is currently unable to do in the borders area or in the new south of Scotland that the new agency will be able to do? Who wants to head off on that, Sandra? I'll start with that one. The new agency will have the ability and the flexibility to be able to respond to the needs of the south of Scotland, more specifically to focus its resources on looking at the circumstances of the area and what is needed to help to achieve its aims of supporting businesses, sustaining communities and harnessing the potential of the people in the area. I think that that will be the ability for the new agency to put a renewed focus into the south of Scotland. One of the things that has been talked about a lot recently is the border area cross-border. How will... I think that there is not an equivalent of a city deal in terms of the border area. Maybe I could explain a bit about that and where it's at and whether the new agency will be able to access funds from it and perhaps use them better than they might otherwise be. Karen, do you want to start with maybe Sandra Cumann or the other way around? I'll start, and then Sandra can pick up on the difficulty. You're right. We're looking at the borderlands growth deal. The borderlands area takes in Freeson Galloway Council and Borders Council and then three English local authorities. That's Carlisle, Cumbria and Northumberland. They're coming together to put proposals to both Governments about a growth deal. In terms of where we are at the moment, they've submitted the proposals to both Governments and we're looking at the detail of what's in those propositions. I think that there are 10 different outline business cases that focus on various themes that they see as key to driving growth across that area. As the detail develops, we'll be looking at how those different propositions and proposals are delivered, so the new agency will absolutely have a role in delivering some of those projects. We're focused perhaps on energy or on tourism or on place. You can see the agency getting involved in that delivery and we're really working hard to ensure that both the projects and borderlands and what the agency's priorities are really closely aligned. You'd expect a new agency to be absolutely integrated with what a borderlands proposition wanted to do. I wasn't sure whether Sandra wanted to come in. Sorry. South of the border, are the three council areas working separately or do they come together in some sort of agency or grouping at all? Together in the borderlands partnership, the proposals that have been submitted to both Governments are from the borderlands partnership, so from all five local authorities together. Colin, I think that yours is the next question. The panel. The board membership will be appointed by ministers as will the chair and the first chief executive. The location of the new agency will be a decision by ministers as well. I see that the action plan can only be changed by the new agency with permission of ministers. That raises some concerns over the issue of local accountability. Specifically on the board membership, how will we ensure that the decisions on membership are in line with local opinion? Sandra? South of Scotland Enterprise, as you'll be aware, is going to be an NDPB, which will be made via an open and fair appointment process regulated by the Commissioner for Ethical Standards in Public Life and the Code of Practice for Ministerial Appointments to Public Bodies in Scotland. As stated in the policy memorandum, which you may have looked at, our aim is that members will provide a balanced mix of the relevant skills and experience necessary, which reflect businesses and communities in the south of Scotland. We intend to ensure that the appointments will be advertised in a way in which we will attract a strong and diverse field of suitable candidates, particularly focusing on those in the south of Scotland. That practice is a standard for the existing enterprise agencies, Scottish Enterprise and High, whose members are also appointed through a public appointments process. What we also intend to do as part of that process is a clear description of the skills, knowledge and expertise that will be put together and used as part of that appointment process. In drawing that together, we'll also reflect on the responses to the consultation. The consultation asked about board members and respondees, submitted their views on what they would like to see. That included people from the local area, young people and individuals from the private sector, but again, they reinforced the need for it to be representative of the people in the south of Scotland. We'll be working hard to ensure that that is what the board is made up of. The bill itself doesn't specify the list of expertise as such. Will that ensure that you have a mix, young people represented, trade unions represented, small business owners represented? Specifically, in terms of the current economic partnership, the local authority are represented on that, the interim board, why are the local authority not represented on the new agency? Those will all be factors that we take into account through the public appointments process, but the bill doesn't specify any of the detail of that. Obviously, local authorities, councillors or members could apply to be members on the board. For example, I am aware that Councillor Stephen Hagan is a member of the board on Visit Scotland. There is access through that means. The final decision of members that will be made by ministers. Yes, that is how the bill defines the moment. On the issue of ministerial direction, I noticed in the Highlands and Islands legislation that ministers can only issue direction following consultation with Highlands and Islands Enterprise, but the South of Scotland bill does not make such a requirement, so we cannot ask why that is the case. Are ministers able, effectively, to veto decisions of the agency in the South of Scotland? The bill does not specify that you are correct, but I would expect that the powers of direction are probably to be used only in exceptional circumstances and in consultation or engagement with the new agency. I am just intrigued as to why that is specified in the Highlands and Islands legislation, but it is not specified in the South of Scotland that this consultation should take place. That could be considered if you considered that it should be contained within the bill. To clarify that, it is not a conscious omission. There is nothing there, it is just something that has not transferred across, but it is something that you think may be considered a delay today. Is that right? That is correct, there is no particular decision. As I said, I would expect some consultation or engagement before any direction was to be issued. Colin, do you have any further questions? The next questions are from Richard Love. Good morning. When you create a new organisation, you surely specify who is doing what, who will be responsible, who will be involved in any new organisation to work. Given the importance of the strategic board to the Government's enterprise and skills with Forbeads agenda, why is there no mention of it in either in the bill or in the policy memorandum? Who would like to go on that? Karen, you are sort of pavering. I'm looking forward to answering the question. The strategic board isn't defined in legislation, so it's a different kind of construct, so that's why it's not on the face of the bill. We'd absolutely expect, like the chairs and chief executives of other agencies for the chair of this new agency, to be part of that strategic board process. The fact is that you create an agency, and sometimes everybody is doing the same thing. That's where I come on to my next question. The bill specifies a role for the new south of Scotland agency in enhancing skills and capabilities relevant to employment. This is surely a core function of skills development in Scotland. How will the two agencies work? Is this not surely duplication, going to cause confusion, and right from the very start, is going to be a disaster? How are we going to sort that? Hold on. I think that we are all taking back that somebody has just said that this may be a disaster. Karen, you are going to convince us that it's not going to be an answer to Richard's question. We are here to probe. We will avoid disasters. The agency won't be the only agency operating in the south of Scotland after 1 April 2020. You are absolutely right. There are other agencies already operating there. Skills development in Scotland being one. Visit Scotland being another. Local authorities being there. Scottish Enterprise will still have a presence. We'd argue that that is absolutely right because the south of Scotland will benefit from the input of lots of different agencies. How do we stop duplication? How do we ensure that it's complementary rather than duplicatory? I think that that's our aim. That's about the new agency acting as a voice of the south of Scotland. Having that dialogue with Skills Development Scotland, for example, and identifying in the south, there are sectors such as forestry that need different skills. Having that informed discussion with SDS about how they can then respond to the needs of the south of Scotland. I think that it strengthens the position of the south rather than creating a confusion. Just in case people take my other comment in a context, I don't want it. I want it to be something that is well overdue for the south of Scotland, something that is well needed and I want to ensure that the organisation will work well with other people to ensure that it is a good level footing for the future. Thank you. You started with the strategic board, so that alignment happens from national down, absolutely. Colin, you've got a supplementary to that. That point. The hands and arms legislation is clear that they've got responsibility for many functions that are carried out by Scottish Enterprise elsewhere, but the south of Scotland Bill states that property liabilities of Scottish Enterprise will be transferred to the new south of Scotland agency, but it doesn't clarify which, if any, functions that Scottish Enterprise will retain, so it's not entirely clear what functions Scottish Enterprise will retain and what specific functions the new agency will have. Do you think that that would be clarified as the bill goes forward or is that something that you'll set out? The bill has been drafted in a way at its high level in enabling to provide the flexibility for the new agency to determine what activities would be most appropriate to meet the needs and circumstances of the south of Scotland. As we said, we expect the new body to assume responsibility for regionally specific enterprise activity. Through that, as you say, it may be building on work that's already been done, and we expect Scottish Enterprise to remain the national agency. It will continue to have a presence in the south, we're sure, with national products such as SMAS or RSA, and that will be something that will be getting developed the activities for the new body through our project delivery as we work towards the establishment of the new agency to determine what activities the new body may take forward. You're right that the bill is at a very high level and the aims are clearly quite general in the bill. It's probably the fair thing to say. Again, in the Highlands Islands legislation it's very specific and the list of functions are a lot more detailed when it comes to Highlands and Islands. Why is it different in terms of this legislation? One argument that I have heard is that Highlands and Islands Enterprise, because it's too specific in that legislation, have been prevented from doing things because their aims and their functions in the bill is very detailed and very specific. Do we have any examples of something that Highlands and Islands Enterprise have not been able to do because of the way their legislation's written? The aims and then maybe Fraser will come in on the drafting construct. The aim of the bill is high level. It's to further the economic and social development of the south of Scotland and improve the immunity and environment of the south of Scotland. It then gives the illustrations of how that might be achieved. I think it would be fair to say that reflects modern drafting practice. We believe that, with that high aim and those illustrations, the new agency can do what it needs to do to respond to the opportunities and needs in the south. Fraser, do you want to say a little bit about where the bill is constructed? The 1990 act, as Karen suggests, is very much a product of its time in the way that it's drafted and structured. I can't speak to exactly what problems S.E. or High may have encountered in terms of the restrictions. These days, we tend to avoid the long exhaustive lists of things, which are in each case in the 1990 act given as specific examples of things under the generality of the power to do anything in pursuance of those bodies' aims. The difficulty with having very elaborate lists is that they begin to look as though they are constraining. The more words you have in the legislative page, the more opportunity you give lawyers to create arguments that if you can infer constraints that otherwise weren't intended. We tend to eschew that style of drafting these days. If I can give you just a simple example, one of the things that Scottish Enterprise and Highlands Islands are empowered to do is to reclaim land from the sea. What we say is that South of Scotland Enterprise can acquire land and enter into contracts, i.e. contracts with people who would be involved in reclaiming land from the sea. We are dealing with it the same propositions, but at a higher level of abstraction. We don't need to get down to the specifics in the same way. For example, Highlands Islands legislation specifically mentions compulsory purchase. Are you saying that the South of Scotland enterprise agency will have that power of compulsory purchase? It would be fair to say that another reason for some of quite a lot of the complexity in the 1990 act surrounds powers that, as a matter of policy, the Government isn't proposing to give to South of Scotland Enterprise. That includes the compulsory purchase powers. It includes the powers to enter on to land without permission. It includes the powers to enter to require people to give information under penalty for not providing it. Those are, as a matter of policy, not being pursued for the South of Scotland. Prove that further. The Highlands Islands legislation talks in depth about safeguarding environment and natural beauty geography of the region, including those provisions on developing environment and natural land, whereas the South of Scotland bill only refers to the immunity environment of the region and doesn't mention natural assets. Are you saying that the bill, or are the responsibilities in this regard weaker than those for the Highlands Islands? Can you give an absolute guarantee to the committee that there is no power that has been given to the Highlands and Islands agency that is not being given to the South of Scotland agency? Your question began from the premise that, by having less detail, the existing agencies were more constrained. I think that we are quite comfortable that, if anything, by having less detail and less constraint built in than the 1990 act has, there is nothing subject to the policy exceptions that I have mentioned around compulsory purchase, obtaining information and so forth. However, in the broad pursuance of its aims, the aims are every bit as broad if not broader. To be clear, there are no additional powers because you are talking about compulsory purchase. There appears to be additional powers given to the Highlands and Islands that are not being given to the South of Scotland agency. Is that the case? Yes. Those specific ones have mentioned the compulsory purchase, the power to obtain information from people and the power to enter on to land without permission. Colin, I think that those are important points that you will get a chance to ask HIE when they come in to see how relevant they are and those powers and whether they have used them. I do not want to cut you off because I want to bring in John and then very happy to come back to you if you want to develop that further. Thank you, convener. I am going to ask about social development again because I think that this was in lay person's terms this is what marked out HIE is different from Scottish Enterprise and I would want to understand that the somewhat perhaps romantic notion people had about the role of the Old Highlands and Islands Development Board and then its successor organisation namely that it wouldn't just be involved as it appears to be now in a lot of the high-level strategy stuff about increasing businesses with export that there is meaningful engagement with communities at very local level is that going to be a feature of the... Or could you give me examples of social development that you envisage that South of Scotland would do because my concern is that it drops off and it's simply begun rather than communities it is solely concerned with the balance sheets of large companies. So, absolutely, Bill gives the agency that social development responsibility. The consultation gave a range of examples of the sorts of activities you might expect to be taking forward as part of that community element. So, absolutely, that focus on developing community capacity. Sorry to interrupt, convener. Just for the record, could you detail some of these activities that we explored helping communities to acquire specific assets, looking at how they could use those assets to generate income. That's a level of detail I'm not going to be able to answer properly. We can come back to that in writing. So, that community empowerment stuff, helping community to develop specific assets, generating income and delivering services. Social enterprises, we recognise, are really important in the South of Scotland. The agency will absolutely have that focus on what it can do to help grow social enterprises. Community-based businesses are similarly really important in resilient communities and play an important part in the economy of the South. So, again, you'd expect the agency to be looking at those sorts of businesses. That place-based focus, so, absolutely having an agency focused on the South of Scotland, they'll be able to really understand what makes a place tick. So, both the business element of that community thing, community element. So, what is the important thing in a place that makes it vibrant and resilient? That's not necessarily a business, it could be a community facility. Absolutely, the agency will be focused on that. And then, how the agency can help communities to respond to opportunities that are presented to them. Highlands and Islands Enterprise are working closely with us, so we understand the best practice there. But we're working with other agencies, like DTAS, like the Southern Uplands partnership, to bring in different perspectives. In terms of the consultation, we've got lots of responses from community councils and community organisations so that the wealth of information there about the actual practical things that the agency could be helping to tackle. Thank you very much. Richard, do you want to come in? Sorry. Sorry, who wants to come in? Fraser, I missed you, sorry. I just wanted to add on the point about the absence of compulsory purchase by helping communities to acquire assets. Of course, one of the things to bear in mind is that, since the 1990 act, this Parliament has conferred community rights to buy. There are more compulsory purchase powers than the Town and Country Planning Act 97, which again didn't exist in 1990. So, again, when you're comparing those two acts and what's missing, we have to bear in mind that the legislative landscape has moved on in large measure through this Parliament's efforts. Richard. Just to make sure, on the next questions, will this agency have the same powers or more as other agencies? Yes or no? Who would like to dodge that question? There's lots of you wanting to dodge it. Can you take it? I mean, I think... Do you want to try that one? The overarching aim of the agency is absolutely what you'd expect Highlands and Islands Enterprise to do, so absolutely on that it's equivalent. As Fraser's been explaining, there are elements of detail that are different to reflect the different legislative processes and acts that have been made since. Sorry to press you. So, basically what you're saying is that this agency will not have the same powers as Highlands and Islands. What I'm saying is that the agency will have a really clear power to... Sorry. Will have a really clear power to drive forward the economy of the south of Scotland supporting communities and businesses across the south of Scotland? I'm not going to cut you off, but I'm going to say that the cabinet secretary will be in it, and I'm sure he will look forward to your robust line of questioning. Yeah, it's a point that we have to... You know, Colin, to start it off, and it's not been answered. Absolutely, and I'm sure he's listening in and taking cognisance that you're going to ask him the question. It's from the deputy convener, Gail Ruskell. Thank you, convener. Good morning, panel. It's just to follow Richard Scott's other line of questioning about duplication of services, and the bill specifies a role for encouraging business startups and entrepreneurship. Is that to replace business gateway, or is that to work alongside business gateway, and how will they work with local authorities to encourage new businesses but also the growth of existing ones? Karen? In advance of the new agency we've created, the South of Scotland Economic Partnership, that brings together the seven key public sector agencies supporting economic development in the South of Scotland. Both councils, as Mr Smith has already suggested, are members of that partnership. That's helping to develop the alignment across agencies and we're absolutely having those discussions about what makes sense for the business in terms of who delivers what. How do you make sure that there's one clear place for businesses to go, get the services they need, but they might not be delivered by the agency, they might be delivered through other organisations or local authorities, or the private sector or the third sector. So you could see a role for the agency in terms of that alignment and helping business to navigate what they sometimes think of as quite a complicated landscape. Will business gateway still exist? That's a decision that hasn't been made. Okay. We're talking with local authorities about how those services are best delivered. Absolutely, business gateway might be the best way to do it. Those discussions are still evolving. Okay. Okay, thank you. The next question is Peter. Thanks, convener. We've kind of strayed in the affair, but nevertheless I'll pose it anyway. I mean basically how will the new agency work with Scottish Enterprise and HIE, given that SE will continue to have a presence in the area and that HIE is the model organisation for the new agency in the south of Scotland? So yes, I think we have covered quite a lot of that ground, but it's about that alignment and complementarity and finding a way for the agency to bring together what businesses and communities need. I mean, specifically, Scottish Enterprise obviously its role will diminish in the future once the new agency is up and running, but it will still have a role in that same region. Is that correct? Am I correct in that assumption? Absolutely. Scottish Enterprise will still operate as the national economic development agency across Scotland, so Sandra is mentioning that there are various national products such as regional selective assistance grants, the Scottish manufacturing advisory service, some of the skills development international services, they're all delivered nationally and you'd expect Scottish Enterprise to do that post the creation of the new agency. There's also expertise in Scottish Enterprise that you wouldn't want to cut the south of Scotland off from, so energy being a good example of that. Scottish Enterprise has really a depth of information around energy, so you wouldn't want to cut the south off from benefiting from that expertise in the national body. Similarly, you can see the new agency developing areas of expertise reflecting its own economy, so forestry for example. How would that help other agencies like Scottish Enterprise and high, so that alignment and complementarity all the way through the system? I can understand that. Both Scottish Enterprise and HIE publish annual business plans that include useful budget information, organisational targets and priorities. Is there anything in the bill that requires this new south of Scotland agency to do likewise? The most direct comparison with the bill would be the requirement for the new body to produce an action plan for agreement with ministers. That action plan would set out how it would be looking to achieve its aims. In the way that you mentioned, the business plan and corporate plans will be used as their blueprint for how they are going to take forward the activities going forward. Obviously, the new board will have a big input into that planning process as well, I would assume. Yes, we would expect that. John Niels is the next question. Thanks, convener. Financial memorandum and some of the figures. A lot of that makes sense that the three parts you've got about set-up costs, running costs and then the on-going budget. On the setting up costs on page 4, I was particularly struck by the estates figure because you've got, and I agree with this process of taking a low figure and a high figure, but they seem quite extreme that the low figure could be £542,000, the high figure could be £2.6 million. So could you maybe just explain why there's such a gap in there? Yeah, absolutely. So in bringing those estimates together, we were looking at all sorts of different possibilities in terms of what the estates of the new agency might look like. At the higher end, we've got costs in assuming that you'd need to fit out of building from scratch, and at the lower end it's much more about co-location. It was very clear from the consultation that people wanted to see accessible everywhere and we're exploring that co-location and how you deliver it, both co-locating with other bits of the public sector estate but also bits of private sector or third sector agencies that offer office accommodation. So that explains the range. So it's much more expensive obviously to fit out a new building. It's less expensive to share premises with others. We're hoping that that co-location point will be the kind of way that the agency operates. Right, and so that includes all the possibilities, whether it's one main headquarters and a lot smaller offices or two big headquarters or whatever the option might be. It explores all those. It gives us the financial estimates for all sorts of different models within that. So one of the options consulted on was around that hub and spoke model so having two or three key hubs for the agency and then spreading out across the agency. So yes, those estimates cover those range of options. OK, thank you. The other point was under the part 3 total budget allocation and I think it says this elsewhere but it says it in page 10, paragraph 53 it says it intended that the allocation given to the new body will be equivalent on a per capita basis to the allocation for HIE. Now I accept that it needs to be higher than what Scottish Enterprise gets because we are a more urban area. It strikes me that HIE is much more spread out has a whole lot of islands it has much more challenges than the south of Scotland does so can you explain why it would be a matching per capita amount? Who would like to go with that? I'm trying to control the committee here because there's a few Highlands and Islands MSPs who might want to jump in on the back of that. Karen, would you like to go on that? Yes, so we looked towards the Highlands and Islands and saw very similar challenges around that geographic spread around the rurality issues around those sorts of challenges. We listened carefully to what consultees were saying so they made the case really strongly that that new body needed to be funded in a way that was equivalent to Highlands and Islands Enterprise. I'm sure that this is an issue that you'll want to pick up with the Cabinet Secretary about how you justify different funding amounts. I can explain where we've got to in the financial memorandum but I suspect the bigger point. There's a similarity with rurality but there's no islands that I'm aware of so immediately that's a cost. I will take this up with the Cabinet Secretary so I'm not going to press you on this too far but surely the needs are not as great as the Highlands and Islands or do you not want to answer that? I don't know, John. You seem to be taking some committee members with you and some committees against you. Let's keep that up for the Cabinet Secretary. Colin, you want to come in and I've got more in. I'll come in as one of the members who certainly is not taking with him and saying that I very much welcome the financial memorandum commitment given that the region is the lowest paid in Scotland but specifically on that commitment per capita that would be £42 million a year would be the budget based on the current budget of Highlands and Islands Enterprise but what you're actually proposing on the financial memorandum is actually only £32 million in the first year and it gradually rises until we get to that £42 million so in fact it's not per capita in the first two years why is that the case because I can think of many projects that would spend that per capita funding very quickly in the south of Scotland so why are we not getting that per capita funding until effectively year three? Karen. We've been working on that transition planning so our assumption is that you build up to the full allocation so in the first year you won't have your full staff in place you won't have your full capital programme in place you want to take the board take the members of the agency and be plotting out that capital programme and where those resources can be used most effectively we took the view that you'd need two or three years to get to that point but obviously that's a point that you'll want to discuss more broadly Thank you Colin Maureen you've got a question It's not related to the financial memorandum but thank you convener when this bill was drafted we were in a different political situation than we are now and we now have a situation where we could probably have a border down the middle of the Irish sea Galloway and that area Dumfries and Galloway will become a kind of borderland so in a different sense is there anything that should be in this bill now to strengthen the area and strengthen the powers in relation to various things that you hadn't foreseen back then and you know has this been considered Sandra do you want to go on that I think the point I would make on that is that the bill has been drafted on an approach to make it high level enabling the new agency to be flexible and it's approach and responsive so that means that it has the ability to change what it does so therefore as circumstances change over time it will be able to adapt and respond to that and we think that flexibility is needed to be able to reflect future situations because we can't future everything but that way we can ensure the agency can respond thank you I've got two more questions Rich Slaw full of by John Scott what you've come to accent said would you agree with me and I used to about the road a lot and the jobs I've done I wasn't the best in an office but basically south of Scotland so the new board will need time to work up A where they want to be as a main hub or hubs and also where they want staff to be is that correct who'd like to go with that I'll go I think the answer is yes but some decisions will need to be made before the board the point that Colin was making some decisions will need to be made just for purely practical reasons I suspect that I should qualify my yes so you're not sorry you're not going to say that the headquarters is going to be at X and the hubs are going to be at Y you're going to say that the board will come in and they will then decide whether to move people for the benefit of south of Scotland I suspect that some of those decisions will need to have been taken before the first of April 2020 so it won't be completely for the members of the agency you'll need some hubs in place so that there will be somewhere for people to start operating from the first of April there will be flexibility to change but we will expect some hubs and some decisions to need to have been made to clarify to go back to your the airshare question and just to get clarification I think you did say and why it's not part of this region did you say that the airshare local authorities did not want to be part of the south of Scotland enterprise region and also is this in part being driven by the growth deals the borderland growth deal and the airshare growth deal is it in part being driven by these two separate future funding streams potential the airshare three local authorities have identified as that growth deal area for the airshares so they've focused on that structure rather than looking to the south absolutely we recognise there are real economic links across the council boundaries the economics don't always respect council boundaries so it was driven by the airshares themselves so they were absolutely focused on getting their own growth deal and looking at their own structures across those three airshare councils certainly in the responses that they gave to us in terms of the consultation they were looking towards that structure rather than towards the south of Scotland but did make the point that establishing an effective working relationship was key Colin, you get a final quite short question why there's no explicit reference to equalities within the south of Scotland bill obviously the legislation on high talks about provisions on responsible with regards to improving opportunities for disabled people women, ethnic minorities and enforcing existing legislation I note that legislation also means that high in Scottish Enterprise are required to give preference within reason to disabled servicemen and women when selecting disabled people is within the south of Scotland but I was wondered if there are reasons for that Felicity There is no express reference on the face of the bill but there is an intention to amend the relevant statutory instruments that apply the public sector quality duty and the other sort of suite of equalities legislations to this new body that will be done as part of the preparation for the commencement of the body in 1 April so they hopefully will be in place by 1 April 2020 if they're not they'll be in place very shortly after that with the body operating as if it were affected by those duties anyway Okay, thank you I think that's all the questions I'm going to ask first of all like to thank you as a panel for giving evidence, Karen you answered the majority of the questions and thank you for that I'm going to ask you just to stay where you are so we can just deal with the next item on the agenda which is agenda item 3 which is subordinate legislation it's a negative instrument for bovine TV just before I do it I'd like to ask members to declare any interest I'm going to declare an interest in that I'm a member of a farming partnership Does anyone else wish to declare an interest Peter? I would likewise declare an interest as a member of a farming partnership as well John Scott Okay, item 3 therefore is the consideration of one negative instrument relating to TB control measures and compensation for bovine animals The committee has previously considered an earlier version of this instrument on the 20th of June but that was revoked on the 30th of June when we identified there had been difficulties with the consultation process I wrote to the cabinet to the Scottish Government on this S.I. to the Scottish Government on this S.I. on this S.I. to the Scottish Government on this S.I. to clarify the compensation arrangements to bovine TB and the responses can be found in the committee papers to confirm that the compensation will be different for bovine TB and BSE as far as the committee should be aware that no motions to a null have been received in relation to this instrument Is the committee agreed that it does not wish to make any recommendation to the instrument? That is agreed I'm now going to suspend the meeting for five minutes to allow the witnesses to depart and the new witness panel to come in. The meeting is suspended for five minutes We're now going to move on to item four which is subordinate legislation in the form of an affirmative instrument on agricultural hoddings Could I just ask if anyone before we do wants to declare an interest I'm going to declare an interest that I'm a member of a farming partnership Likewise, I will declare an interest as a member of a farming partnership as well Okay, so we're going to move on to agenda item four and this is consideration of one affirmative instrument the agricultural hoddings Scotland at 1991 variation of schedule five order 2019 draft The committee will take evidence from the cabinet secretary for the rural economy if the affirmative instrument will be considered at item five Members should note there have been no representations to the committee on this instrument I'd like to welcome from the Scottish Government focus hearing the cabinet secretary for the rural economy Jen Willoughby, the head of agricultural hoddings team and Julia Bergen-Person the Scottish Government legal director Cabinet secretary, I think you'd like to make a brief opening statement of up to three minutes Yes, good morning, convener and thank you for inviting me to discuss said order. I hope that you will agree with me that this order is a good news story for tenant farmers in Scotland Schedule five of the Ag Holdings Scotland Act 91 sets out a list of improvements to agricultural holdings which may be eligible for compensation when the tenant leaves the holding The list was originally created for the Agriculture Scotland Act 1948 which is some time ago hasn't been updated since some items which are readily accepted now as being legitimate improvements are therefore not listed therein informal arrangements may be in place between landlords and tenants to cover some of these items but this will depend on individual arrangements meaning there is no uniformity of practice during the widespread consultation conducted by the Ag Holdings Association review group in 2014 there were calls from the sector for the list to be updated the purpose was to reflect modern farming practice and to eliminate doubt and confusion The underlying rationale of current provisions for WAGO is to encourage tenant farmers to invest in the agricultural holding and to keep it in good condition knowing that they will be adequately compensated Updating the schedule therefore benefits both the tenant who makes an investment and the landlord whose property is thereby improved In order to ensure that any update was industry led we placed a duty on the tenant farming commissioner to make recommendations to modernise the list He consulted with key stakeholders and delivered his recommendations to me in December last year and we are now seeking to implement those recommendations Once the order comes into force in January next year the updated schedule would apply I hope that this will lead to greater certainty for both sides and I have been heartened by the positive press reaction since the order was laid In conclusion, convener I hope that you and your colleagues members of the committee will approve this order and I and my officials are happy to seek to answer any questions that you may have Thank you Cabinet Secretary You said that it is a good news story and I certainly agree that it is a good news story for tenants and it is very welcome You also said that you had made widespread consultation with industry which I also accepted but are there any particular areas of concern that were highlighted during that consultation process? We did consult fairly widely with the Scottish Tenant Farmers Association, the NFUS Scottish Land and Estates the Charter Severs and SAVA auctioneers and valuation Association Broadly speaking it is reasonable to say in as much as it is ever accurate to make such generalisations that the majority of stakeholders are broadly satisfied by the outcome and indeed have in many cases welcomed it but of course in the way of things not everybody gets everything that they want I suppose you could say that about Christmas as well perhaps Governments not really well cast in the role of Santa however desirable that may be so yes some stakeholders may be disappointed we haven't been able to take on board for example the Tenant Farming Commission is recommending to include permissions, consents, contracts authorisations or restrictions and I know why and I can explain why we were not able to accept that and perhaps can come on to set that out later other than that I'm not aware if there's any specific areas of disappointment Thank you very much for that the only detailed thing that I would follow up on is that a catch all clause seems not to have been included why have you chosen not to include a catch all clause well the commissioner considered the option of a general catch all to future proof the schedule and I know that Mr Chapman is correct that some of the stakeholders were in favour of this approach and I can see the attraction of it but I think the reason that we elected not to include the catch all clause is that this kind of general clause is open to interpretation it may therefore lead to more disputes and disagreements about what is in scope and what is not the purpose of what we're doing is to provide as much specific detail specification as is possible in order to inform the parties in the negotiations over the compensation that we go and to have the limit as little scope for ambiguity and therefore disagreement as was possible I do agree however with the recommendation of the Farming Commissioner that instead of a catch all that we do commit to reviewing the schedule on a regular basis and I'm willing to make this commitment to look at the schedule say every five years to see if it is still fit for purpose and indeed if a more frequent review were shown to be necessary then of course something that I would always consider very carefully indeed so in short rather than a catch all which we felt may give rise to possible difficulties we thought that a willingness to update the list more frequently than has been in the past might be the better preferred approach I would just say I think that is important it is important that we look at it on a regular basis and that they promise to do exactly that so yes Peter John, you've got a brief follow-up and then Richard Very brief follow-up and to clear in interest again as a farmer but I'm just seeking a final assurance in terms of ECHR compliance not explanatory notes I'm saying this will avoid any unfairness which I know was an issue before in various parts of this legislation and we've been rebuked in the past by Lord Gill and others for our inadequacies here in Parliament so a final reassurance from you cabinet secretary that this is a ECHR compliant piece of legislation We have no reason to believe that there is any significant risk attaching to any claim under ECHR which I presume would be based on article 1 of the first protocol as most of these issues are so we've no reason to believe that there's any issue involved but I entirely agree with the approach that Mr Scott has advocated namely that we have to take great care in this area of legislation not least because sadly there has been an instance where previous legislation passed by a former administration had to be overturned and corrected by us as it happened with the consequences which I know we all very much regret so I'm not aware of any issue and as far as I'm aware I'm advised that the SLE did not raise any issue in relation to this particular matter Thank you Thank you cabinet secretary Richard I think this is a really good news story in a compliment union officials that you've done on this the questions I have and his report the tenant farmer commissioner said there is reasonable certainty that schedule 5 can be reviewed regularly I think you partly answered my question but how often will you review the schedule so that emerging issues can be included please Well I've mentioned a period of five years but that's kind of a long stop I mean all parties come to me and suggest that some pressing need for a more swift review then I would always seek to be as accommodating as possible assuming that the issue could be dealt with by secondary legislation primary legislation of course is another kettle of fish particularly in these times and I won't mention the B word because I don't want to depress anybody this morning I've always found you very accommodating so basically any problems that I've had also the tenant farmer commissioner said in his report there may be a cause for drawing attention to the fact that improvements that are part of a diversification are subject to different regulation with respect to approval and compensation arrangements such a note appears not to be included why not and do you have other plans to avoid possible confusion in this area well I think that this matter is a sort of lawyerly answer which is that the act only permits us to vary the provisions of the schedule so clarification of the point that is raised by the TFC the commissioner is a matter for guidance but my officials will work with the commissioner to produce a code of practice to clarify any of these issues so hopefully it can be dealt with in that fashion you know rather than by the statutory instrument which we're considering this morning thank you cabinet secretary that appears to be all the questions that the committee wished to ask you on this do you want to make any brief closing remarks no thank you we'll therefore move on to agenda item 5 which is and this is the formal consideration of motion s5m14752 in the name of the cabinet secretary asking the rural economy and connectivity committee to recommend that the agricultural holding Scotland act 1991 variation of schedule 5 order 2019 draft be approved cabinet secretary would you like to move motion s5m14752 moved do you have any further comments that you wish to make none are there any comments that the members wish to make the question therefore is that motion s5m14752 be agreed are we all agreed we are agreed thank you very much cabinet secretary and thank you for you and your witnesses to give evidence to the committee this morning I would ask if you'd like to depart quietly while we move on to agenda item 6 which is a public petition this is the consideration of PE1616 which seeks the parliaments to support to make it an offence to park in front of a dropped curb this is the committee's first consideration of this petition the committee however as we all know has discussed this in other evidence session on the transport bill does anyone wish to make comments on this Maureen thank you convener yes as you've said I have tended to as far as possible ask witnesses during our progress on the transport bill about this particular issue in the bill there's obviously proposals relating to pavement parking and double parking but not about parking in front of dropped kerbs and as I've said I've had a constituent who has a real issue about this so I think there is an opportunity to get movement on this in the transport bill and I think that we should congratulate Mr Shaw I think it is on bringing forward his petition and I think there is an opportunity for us to progress what he wants to do in the transport bill so rather than just say that's it I think we should keep it open our options open and his options open and see how we can hopefully try and incorporate this into the transport bill Thank you Maureen Richard and then John I agree with my colleague Maureen what most certainly people who are in wheelchairs face a daily problem trying to cross the road and we forget that we have the height they're sitting in a wheelchair so that they're lower down they have to cope with traffic they have to cope with all the things that's everyday life and I think that we should certainly as a problem it has to be resolved and hopefully will be resolved through the transport bill Thank you Richard John I just agree with what Maureen what and Richard Lyle have said and it's certainly been an issue that's been brought to my attention in my constituency the unreasonable parking on pavements denying wheelchair access to those pavements the problem is there's also times when it's reasonable to park on pavements given the narrowness of streets in some residential areas and quite how that is resolved I would like to hear evidence taken on that where I to be part of the committee that's considering the transport bill which I am not but I hope that perhaps that committee will look very closely at these issues which are all related and which do need to be addressed because there's certainly a significant degree of unhappiness among the disabled community about the lack of access reasonable access to pavements Okay, there seems to be a general consensus as there has been on previous evidence sessions in the transport bill that the issue of drop kerbs is a matter that the committee should continue to raise and try and get the Government to consider as part of the transport fill and try and maybe get some amendments to get in there to get into the bill to cover this issue but it also seems that there seems to be general consensus that as part of this process it would be useful to keep the petition open therefore it would assist us in taking that matter forward with the Government Are we in agreement with that statement as a committee? Okay, so I think that's what we'll do is we'll keep the petition open as we've agreed and thank you very much I'm now going to close the meeting and move into a private session Thank you very much