Net Zero, Energy and Transport Committee [Draft]

Meeting date: Tuesday, October 3, 2023

Official Report 730KB pdf

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Environmental Regulators

Welcome back. Our next item of business is an evidence session with two of Scotland’s statutory environmental regulators, NatureScot and the Scottish Environment Protection Agency. The committee aims to have a session each year with the environmental regulators, to discuss their annual reports, finances and main priorities for the year ahead. This session will be wide-ranging and will touch on many aspects of the regulators’ roles. It may also contribute to the committee’s pre-budget recommendations to the Scottish Government in the coming weeks and to our work in other areas in future months.

I am pleased to welcome Nick Halfhide, the director for nature and climate change at NatureScot, and David Harley, the chief officer for the circular economy at the Scottish Environment Protection Agency. Thank you for joining us. I believe that you each want to make a brief opening statement; I have been told that Nick will go first, then David.

Good morning and thank you very much for inviting me. I have a couple of quick comments. As you know, NatureScot is Scotland’s public nature agency. We bring 30 years of experience, expertise and passion to our nation’s most vital endeavour: tackling the nature and climate crisis. As a reminder of the scale of that crisis, the “State of Nature Scotland 2023” report said last week that one in nine Scottish species is threatened with national extinction and that since 1994, there has been an average 15 per cent decline in species abundance across our closely monitored wildlife.

In response to the crisis, we are seeing significant policy development in the Scottish Government and there will be a number of bills in the Parliament this session. From NatureScot’s perspective, that policy development, which builds on what has gone before, is a major opportunity to reverse nature decline and hit net zero targets, and we are energised by the direction of travel. We know that that work will increase demand on our services and advice, and that that will no doubt be true for a range of other public bodies, including local authorities. We think that we can rise to that increased expectation on us, but it puts pressure on our capacity and resource.

In response, as well as driving efficiency, we are getting creative, which means that we are changing our approaches to delivery, especially in relation to digital solutions; we are identifying new, appropriate revenue streams; and we are fully engaged in public sector reform. We recognise the value of the Scottish Government’s commitment to invest £500 million in nature through to 2026, which is very welcome and necessary. We are also seeing increased interest in nature finance from private sources, with our role being to promote responsible investment in natural capital.

As promising as all that wide investment is, much of our support for the transformation that we need to see comes from our core resource, which is funded by grant in aid from the Scottish Government and topped up by funds that are ring fenced for things such as nature restoration and peatland action. Although the ring-fenced funds continue to increase, our core grant in aid is under considerable pressure, from both challenging public finances and high inflation.

To close on a positive note, the public sector is rising to the nature and climate challenge. Where that challenge might previously have been the sole purview of organisations such as my own, Nature Scot, we now see everyone stepping up and that will be a cornerstone of a whole-society response to the crisis.

It is good to be here. This is SEPA’s 27th year as Scotland’s environmental regulator. We have a huge range of functions and regulatory duties that cover all aspects of Scotland’s environment, including water, resources and air. We work with operators and people across all scales, from the very local, such as at septic-tank level, up to national infrastructures, such as Grangemouth oil refinery, and everything in between.

We are protecting and improving the environment. That protection job is worth thinking about in the context of on-going development over the past 30 years and with the impact of climate change. Our staff respond to events daily and their work involves permitting activities, auditing, inspecting, monitoring and so on. Another key role is that of Scotland’s flood authority. We are involved in flood warning, advising planning authorities on new developments and in national strategic flood risk planning.

As Nick Halfhide said, the climate emergency and biodiversity crisis present an extraordinary challenge and opportunity for environmental regulators. There is increased expectation from the public, which is quite right, and there is more for us to do across a wide front.

As we work on our new corporate plan for the next three years up to 2027, the need to focus has come to the fore. We need to be able to make an impact in the most efficient and effective way possible. The focus in our emerging corporate plan will be on climate resilience, net zero, the water environment, resource use and, as always, will be underpinned by compliance across the board.

I will speak a little about finances. Fifty per cent of our finance is made up of grant in aid and roughly 50 per cent comes from the charges that we take from those that we regulate. In 2020, we had a cyberattack and we are using that as an opportunity to modernise the organisation, particularly in relation to digital services. We are working on our annual report. In the new year, our chief executive and chief financial officer would be very pleased to talk to the committee about the financial report for 2022-23.

Before we go any further, I remind the committee of my entry in the register of members’ interest, or would you like to sum ups. I am part of a family farming partnership in Speyside. As such, we have regular interactions with both NatureScot and SEPA. SEPA is also a tenant on a small part of my farm, where it has a gauging station and a monitoring station to monitor water quality, which I encourage it to do. I have regular interactions with both agencies.

Since the committee’s last meeting, there has been a change in SEPA’s leadership. That change was quite abrupt, and for a small period of time, there was no designated chief executive—although I am sure that there has been effective leadership. Will that result in wider changes of governance and culture in your organisation, or were those aspects sufficient when the leadership changed?

The first thing that we did following the departure of the previous chief executive was to have a listening exercise with our staff in order to learn the lessons from the culture that was linked to that leadership. Ten per cent of staff participated in the exercise and we have a series of recommendations that we are embedding into the way that we manage ourselves going forward, so we are very much on that.

Jo Green did a fantastic job as an interim chief executive for 10 months and Nicole Paterson joined us around November last year. We are moving on and looking forward. Nicole has made some adjustments to how we work, with those changes being largely administrative. There is a big focus on delivery and getting the job done. The changes are very much about empowering our staff and devolving decision making to the organisation, which is the way that it should be. We have moved on.

I have met your chief executive. One of the issues that I constantly hear about is the cyberattack and that you are still running to try to get back to where you were before it happened. Is that the case, or have you fully caught up?

We have not fully caught up. The cyberattack was devastating and stopped us in our tracks. For three months, most of our staff could not communicate with each other—it was that devastating. A lot of data was taken from us and most of our systems were completely destroyed.

I can talk a bit more about the phases that we are going through in relation to that. We are focusing on building bespoke systems. Our organisation is up and running from a technical point of view and from an information services point of view. We have created the IS infrastructure for a much more modern organisation and we are working on bespoke systems associated with things such as licence administration, laboratory data handling and planning casework.

At the moment, we have workaround systems that enable us to do those functions, but they are a little clunky and they are not as efficient as they could be. We are working on getting those systems in place.

The committee seeks reassurance that your resilience to such attacks in the future has been greatly enhanced, and that you have a reserve system in place to ensure that it is not destroyed, which is what happened when no one could speak to each other. I would like confirmation of that.

Absolutely. Three independent assessments of our status were made and we are working on all the recommendations. We have delivered on all the security and resilience recommendations, so I am very confident in that now.

How much will the new system cost, computer-wise?

I do not have the exact cost. We are getting help from the Scottish Government for our three-year capital budget and we are moving into our third year of that. I do not have the exact costs, but I can—

Could you write to the committee and say what the new system will cost, so that we are aware?

Absolutely.

If possible, we can then follow it through into the Scottish budget.

The next questions come from Douglas Lumsden.

I will stick to the budget lines. There has been a decline in the year-on-year funding over the past eight years until this year’s budget, when there was then an increase in funding from the Scottish Government. What impact has that had on your organisations and the work that you are trying to do?

David Harley just had a bit of a session there, so Nick Halfhide can start off on that one.

First, just to be clear, the additional money that we got in the current year was because the Scottish Government brought forward money that we would usually get in the autumn budget change, but it was given at the start of the year.

Overall, our grant in aid has remained pretty much static over the past four years once you strip those things out. What that means at the crude level is that we have less money to spend on services once we take account of inflation and increased staff costs, so we are having to prioritise very hard and innovate where we can in service delivery. For example, we are thinking about how we can move our licensing online, because we think that that will be far more efficient. We can drive efficiencies through that, but it means that we have to work around the key priorities that the Government set and that we agreed through our corporate plan for 2022 to 2026.

That seems strange to me. You spoke about policy development, the Government trying to hit net zero targets and an increase in demand, but at the same time your core funding is being reduced, which does not quite make sense to me.

Our overall budget has increased because of the ring-fenced moneys that I mentioned: the nature restoration fund, the better places fund and the peatland action fund. Those come with the resources to deliver them, but our core grant in aid pays for everything else. For example, our on-going monitoring of nature sites and on-going gathering of data has stayed level and therefore, in real terms, decreased, which is very challenging.

For monitoring, we have to look at whether we can get citizens to do the monitoring on our behalf. In some instances, that is successful, but there is still a core amount of activity that we have to sustain.

David Harley, your core budget is similar to NatureScot’s, in that it is reducing in real terms.

In real terms, it has reduced; it has stayed broadly the same. I remind the committee that that is 50 per cent of our operating costs. We have some control over the other 50 per cent. We must cost recover. We set permitting charges and subsistence charges for those that we regulate, and we have some control over that.

At the moment, grant in aid stands at 49 per cent of our total budget. To give a similar response to the one that Nick Halfhide gave, we need to prioritise and be much more ruthless about that prioritisation, and we need to work with the Government on that. There is a lot of expectation from the Government, so we need to focus on where we make the greatest impact.

09:45  

Can you make up that shortfall from licensing, for example, or chargeable things?

No. We have just conducted a review of our charging scheme with that in mind. We can recover our costs only in relation to those particular roles. Marginally, we can make some tweaks and get a little extra but, broadly, that does not make a huge difference in the big scheme of things.

NatureScot has been trying to move to a full recovery model for licensing. Can you give us an update on that, Nick? Have you been talking to SEPA about its approach to see whether there is anything to learn there?

Yes. SEPA is one of the organisations that we look to, because it has experience in the area. It is not exactly the same, because a lot of the licences that we deal with are not for businesses—they might be for individuals who do bird ringing, for example. We are looking to trial our cost recovery in areas where we deal with businesses that we think can afford that or that will not be adversely affected by paying, but without putting a burden on individuals who we need to license but who are often doing activities almost on a voluntary basis.

We absolutely are learning from SEPA, because there is a model there that can be useful. That will, we hope, cover the additional costs of the additional licences that we are about to take on through the muirburn legislation, but I am not sure that that will be a good cost recovery model for a whole load of the other licences that we already deal with.

Over the summer, I talked to wind farm developers and heard that there may be changes to the planning process to try to speed it up. One complaint that I hear is that, probably because of a lack of resource, it takes quite a while for organisations to give approval or make comments on applications. Is that problem due to a lack of resource, and could it be changed by changing the way in which the licensing or the fees work?

When we deal with planning applications, we do not charge for them. They are not chargeable for us, which is different from licensing. We give comments or advice to the decision maker. It is quite difficult to predict the volume that will come through—we do not control the volume and it varies hugely. We try to be as flexible as we can to ensure that we have the staff available when we have a surge of applications. We have been quite effective in saying that we will look only at the most impactful applications, whether they are for onshore or offshore developments.

However, we are really challenged—it is a nice challenge to have, in a way—by the increased volume of applications for wind farms, and particularly offshore. That is new territory, and the amount of data, the quality of the data and the specificity of applications can be really challenging. We are as efficient as we possibly can be because, particularly with wind farms and other renewables developments, we want them to happen if at all possible, but we have to ensure that, particularly offshore, we are not driving one industry’s success at a huge cost to nature and biodiversity. Getting that balance right can take quite a bit of time.

Could developers pay more to try to increase your capacity so that the process could be quicker?

Potentially, yes, if that were paid into a central pot for all the advisers. We would find it very difficult to do that unilaterally, because that would appear to be favouring one applicant over another, which we would not do. Theoretically, there could be a greater contribution to give greater resources and improved data. Having said that, some of this stuff is just really difficult. If we are dealing with seabirds, for example, we may need two years’ data to understand what is happening—one year is not enough to allow us to compare. Some of these things just take time to get right.

I was not trying to single you out; I hear the same about Crown Estate Scotland and Marine Scotland. It takes a lot of time for those organisations to give a view on new developments.

One area where I think that we can be more efficient, in the wider sense, is in pre-application discussions with any developer and, potentially, with other regulators; those are very important. Doing that early on requires the developer to be ready, which can result in big benefits in the formal application process. That is something that we are trialling with aquaculture with the relevant local authority and NatureScot. We are looking at a way of doing a streamlined parallel process, which should result in efficiencies.

Douglas, before you go on to your next lot of questions, there are some other questions that members want to ask on budget. Is now the right time to bring them in?

Yes.

Okay. Our deputy convener Ben Macpherson wants to come in.

Thank you, convener. I was also going to ask about the consenting process. The answers in response to Mr Lumsden were helpful and give us some food for thought about what to inquire of other organisations.

On organisational priorities and therefore budgets, I have one other question for SEPA. I noted that you list the response to waste crime as a priority. Are there any parts of that that you want to emphasise as a priority? I am thinking about the challenge of dealing with the influence of both organised and small operational criminals in the sector and the challenge that that presents to all of us.

I absolutely share your concern, both because of the environmental impact and because of the need for fair play across all the legitimate operators in that sector. We put a lot of effort into that. About 10 years ago, we set up a dedicated enforcement and investigation unit. That really lifted our game in terms of investigations, using intelligence and working with the police. As you will appreciate, there is a lot of criminality in the sector, so we need a different and very specific type of regulation and enforcement and a specific type of skills. I can go on at some length about the different types of investigations that have been on-going over the past years.

I do not want to pre-empt the questioning on that issue. I think that you will get a chance to cover it in the next part of the meeting, when we look at the Circular Economy (Scotland) Bill. I am sorry, Ben.

I am happy to wait until later. If there is any follow-up that might be helpful for the committee—

We can provide that.

We would appreciate that, as appropriate; I know that it is a sensitive area.

Nick Halfhide, if understand it rightly, the hunting with dogs licensing scheme has just landed on your plate—well, it landed before, but it becomes effective today, doesn’t it?—and you are about to get the grouse moor licensing scheme. Last time I visited NatureScot, or Scottish Natural Heritage, if I remember rightly Donald Fraser was your licensing officer in a very small team, and he said that he could do everything. Does he need more resources with this extra legislation, and are you in a position to give them to him?

You are right that it was Donald Fraser, and that our licensing functions are expanding rapidly. The hunting with dogs scheme is relatively modest in terms of the number of applications that we expect to receive. That said, we expect it to be contentious, so, although I am sure that our licensing function to deal with that can be done in house within our existing team, if we get taken to a legal challenge on any of our decisions, that will be hugely resource intensive. However, we are anticipating that.

Far more significant in terms of resources will be the licensing that is envisaged for grouse moors and muirburn. As you will know from the financial memorandum that was published with the Wildlife Management and Muirburn (Scotland) Bill, we are looking at start-up costs of about £400,000 or £450,000 and on-going running costs of about £350,000. They are detailed in the financial memorandum. We are looking at how we are going to fund that. We would wish to get that through some sort of cost recovery in due course, but that will not be immediate. That is part of our on-going discussions with the Scottish Government about funding those additional responsibilities.

Clearly, we are also looking beyond that legislation to the other legislation that is likely to come before the Parliament, particularly the natural environment bill. We will work hard on the financial memorandum to ensure that it is clear what the additional costs to us will be, as well as on the discussions about how we are going to fund that.

I picked up on you saying that you are ready for a legal challenge. Does that mean that you are anticipating that?

We will be looking at the risk of legal challenge to all our functions. That is a new area and our intelligence is that a legal challenge is not unlikely—which sounds like weasel words—and that we might well get one, given the nature of the function and the applicant’s appetite.

That could take considerable time and resources. I am trying to work out in my mind if there are enough people in that department to do what you are being asked to do. From what you are saying, it sounds as if there ain’t and that you need more money.

That is true at the moment, but we anticipate having discussions about how we are going to cope with the additional responsibilities as a result of legislation.

That is interesting, because when Parliament discussed that we were told that no additional resource would be required. We will leave that there and move to a question from Douglas Lumsden.

Hold on.

Mark Ruskell, do you want to come in on this subject?

Yes.

Go for it.

You piqued my interest, convener, by talking about the licensing of hunting and I would like to get NatureScot’s view on that. Do you think that there is any circumstance in which a mounted hunt could credibly claim to meet the criteria for the issuing of a licence?

That is not my area of expertise, but I understand from colleagues that the bar is set incredibly high. The idea is not that it would be a general licence that is given to everyone who applies unless they do something terrible; it is more the other way around: an incredibly high bar will have to be met for a licence to be issued. It is because there is a high bar that we think that there may well be legal challenges, particularly because it is quite new.

That is useful to know.

Convener, can I come back to something that you said previously?

Yes.

The financial memorandum, which I looked at again this morning, makes clear what the additional costs to our organisation and others for muirburn and grouse moor licensing will be. That is in the public domain.

I accept that. I was talking about the licensing of hunting with dogs, because I am not aware that any additional funds have been made available for that. If I am wrong, I will correct the record.

Back to you, Douglas.

I am moving on to peatland restoration. Three years ago, the Scottish Government committed to spending £250 million over a 10-year period. How much of that has been spent to date? Can you give us that figure?

I do not have that figure in front of me, but I am happy to supply it subsequent to the meeting.

That is a new industry, and the challenge is not the availability of money but the availability of contractors to undertake peatland restoration work and the unwillingness of many land managers to come forward. Those managers do not know how peatland restoration would relate to agricultural support mechanisms and to the carbon market. There has been a great deal of understandable reticence from a number of landowners to come forward with big applications until some of those areas have been sorted out.

We have been working hard with the contracting sector to help them increase volume. Peatland restoration is a very seasonal piece of work and we are helping them to develop that alongside other activities. They need skills and machinery, because it is a very skilful job.

Do you expect spending to ramp up over the 10-year period?

Absolutely, as we would with any new industry. We are in the foothills, but we expect spending to increase. The feedback from contractors is that they get it and that they are tooling up; the feedback that we get from land managers is that more and more of them are willing to come forward as it becomes clearer how that relates to other elements of policy—which is not yet 100 per cent clear—and how it will become a source of income for them through carbon credits.

It still sounds as though a lot of work needs to be done before it would ramp up.

It is taking time, but we are beginning to see it ramp up. It will take a number of years. It is a bit like the North Sea oil and gas industry in its early days. We are finding our way through that.

10:00  

Back in 2020-21, £20 million was committed. If that money was not spent, I presume that it does not come to you, as much as you would like it to; it would probably just drift back into the Government’s coffers for it to spend on anything that it likes.

To date, the peatland restoration money has been ring fenced. If we have not spent it, we will declare to the Scottish Government that we are not on course to spend it and then we will return it to the Government.

You cannot spend it on anything else.

Not to date.

Right; okay. That is all from me for now, convener.

The next questions come from Mark Ruskell.

I come back to natural capital finance. There is quite a debate about how those markets can be regulated in a way that builds in the right values and ensures that they have integrity. I am interested to hear your thoughts on that. I want you to comment specifically on the finance pilot and the memorandum of understanding that has been signed on that. The headline figure is that there is £2 billion-worth of funding. Will additional public finance come in on the back of that £2 billion? What is the mix of private and public funding? In addition, it would be useful to get your general thoughts on natural capital finance.

I will kick off. I will make a couple of general points to start with.

The size of the funding gap, if we are to halt the loss of biodiversity and restore nature, not just for its own sake but principally as a way of adapting to the far more chaotic climate that we have, is estimated to be around £20 billion. It could be higher or lower, but it is of that order. Our initial thinking is that that is way beyond the means of public finance, regardless of how optimistic we are about growing the economy. Therefore, for a number of years, we have been looking at bringing more private finance into the sector.

On the example that you mentioned, we are working with Hampden & Co and a number of other people. That is just one pilot area in which we are seeking to explore where we can get in private finance and blend it with public finance and land management businesses, and whether there is a model that will give a return to the private interests and achieve the public objectives that we are trying to achieve. We are also looking at a number of other routes through which we might do that.

That is where the ambition is—which, as I have said, is driven by the fact that there is a huge amount of work to be done. At the moment, we see no route other than through engaging responsibly, as we are doing. We know that colleagues in the Scottish Government are working on a framework so that we can do that responsibly.

Okay. Can you go back to my question about how much public finance will come in? Will you explain a bit more about the model? How will it be monitored, what are the opportunities and risks with it, and at what stage of development is the pilot with Hampden & Co?

That pilot is still at a fairly early stage, and elements of it are commercially sensitive because we are still in discussion with private businesses. It is perhaps too early to be specific about the public finance and private finance elements.

On monitoring, we are absolutely clear that the pilot will need to be very closely monitored because we will want to make sure that we are getting public benefits from the public sector investment. Equally, the private investors will want to be able to show that they are gaining the credits—the biodiversity credits or climate change credits—that they want from what is an incredibly early-stage emerging market.

I am happy to provide more detail in a letter if you like, but at the moment I am not sure that I can offer much, given the stage at which the negotiations are.

That is clearly an area of interest for the committee. I am sure that we would, as details emerge, like to see exactly how projects are emerging on the ground. It might be too early to see that at this point.

Just before we leave the matter, I will push a little bit. Do not get me wrong—I do not think that there is enough money in the public sector to fund all the things that need to be done, but I do not understand where that £20 billion figure comes from, and I do not understand the methodology for getting it. If you would be happier writing in, I would be happy to receive a response in writing.

I will write, but I will say that the amount is a mid-point estimate. This is not an exact science, and various studies have tried to estimate it, but £20 billion is the headline mid-point figure. It is not exact, but it is, I think, of the right scale. However, I am happy to provide the provenance, as it were, of the estimates.

I know where the figure came from: I am just not sure that I understand how they got there. Anything to stop it being a guesstimate would be helpful.

I have another question. If £2 billion comes from the private sector to invest, it will be selling on or trading the carbon credits for that. Therefore, it would be helpful for me to understand whether, if it is a public-private partnership, the carbon credits would be jeopardised because the terms of the agreement lock up those carbon credits and remedial work needs to be done to protect them. Who carries the risk? Is it the person who sold them, the person who invested them and oversaw the scheme, or is there a joint risk? What risk is there to the public purse? It slightly concerns me that once the money has been paid, those carbon credits will probably be traded for 80 years. Who will be carrying the can in 60 years’ time, if there is any infringement? Would it be NatureScot?

I will have to get back to you on that.

Okay; perfect. I will leave it there. As Mark Ruskell said, it is quite a niche subject, but it is an interesting one.

Good morning. My questions are all for David Harley of SEPA. First, I will pick up on enforcement. Recently, criticism by some environmental groups and communities has played out in the media, that there has been a trend of decreasing enforcement action. Will you respond to those concerns and say whether you believe that there is the right balance within SEPA between supporting business and communities, and enforcing compliance with environmental regulations?

I am aware of those concerns. To look firmly at prosecutions and the number of them is quite a reductive way to look at SEPA’s performance, which is really about the impact of our working with operators and pulling levers further upstream in the process to ensure that we do not have non-compliant activities in the first place. That can be more effective in the long run, in relation to environmental outcomes.

That said, we have plenty of prosecutions and lots of enforcement work under way, a lot of which is not visible until it actually happens. It is still very much our ethos that we will wield a big stick when that is needed, but we need to be strategic about that and to pull all the levers that we can pull to ensure that we do not get non-compliance in the first place.

I think that many people would agree that prevention of non-compliance is the really crucial work.

The people who have been quite vocal are, I would say, friends of SEPA, including two former chief executives, who have expressed sympathy. They have made comments, including about SEPA being starved of funding. We have heard that your funding has been slashed by more than a quarter in real terms since 2010. One talked about a

“starving of funds”

and another said that people are

“distracted to cost-saving exercises”

that take officers away from front-line environmental regulation. It sounds like those people are critical friends. Are they saying the kind of things out loud that people in SEPA today would perhaps like to say to committees such as ours?

I do not think that they are. We talk about the challenging times that we are in and the need to focus what we do. Prioritisation of activity where it will have the greatest impact is really important. As the public quite rightly get more concerned about environmental issues, they can distract us from the work that can be truly impactful.

The comment about cost-saving exercises is interesting. I do not see a situation in which front-line staff are distracted by work on cost-saving exercises. I think that we can be more efficient, so we are building our systems to enable us to do that. I think that we need to prioritise further.

On the original question about striking the right balance between supporting and enforcing compliance by businesses, are you saying that, right now, you think that the balance is good?

Yes.

I will move away from enforcement to ask about information that is available in the public domain. That was touched on by the convener, when he asked about your recovery from the cyberattack. I think that you said that not all of your systems are back up and running, and that not all of your data is available. That has caused a lot of concern. I think that the Environmental Rights Centre for Scotland has made an official complaint to Environmental Standards Scotland about SEPA. I am not sure of the status of that complaint; my comment is based on media reports from a couple of weeks ago. There is a great concern that SEPA is failing to maintain the public register, which means that pollution permits for about 175,000 sites are not available, and that information is not in the public domain. What is going on there?

As an evidence-based regulatory organisation, it is in our DNA to be transparent and accountable. It pains us greatly that that information is not publicly available. We have a public register, but it is in paper format in boxes and is not easily accessible. That is the main problem.

The data that was available electronically was significantly impacted by the event. Data is unavailable electronically, and the ability of SEPA and the public to interrogate the data is significantly compromised. We are rebuilding our public register in phases, with a short-term focus on making more information publicly available. The aim is to make it much more accessible.

The other area that we are struggling with is access to information inquiries. Again, we had a huge backlog that was difficult for us to manage. We have had to make some fairly draconian decisions around that so that we can, essentially, start again. Our inability to be as transparent and accountable as we want to be is one of the most difficult predicaments that we have had to face.

I appreciate that the situation must be difficult for staff, who are working hard to get everything back up and running.

What does the situation that you are outlining look like in practice? If I, as a Central Scotland MSP, want to get information about a site in Lanarkshire, I cannot get that information from the public register online, so how do I go about getting it? Is it available? Do I have to physically go to an office?

You should contact us directly. There might be ways of getting that information to you based on information that we hold internally, although the data is not easily accessible and is not complete.

There is a bit of a double-edged sword, in that we are finding that, as a result of the deficiencies in our ability to provide that information proactively, people are increasingly coming to us with access to information inquiries and freedom of information requests, which creates another area of difficulty, because that is hard to resource. That is a challenge, but we are working hard on it and are investing in those systems.

Essentially, if you want that information, you should get in touch with us.

Does that apply to any member of the public in Scotland? Can they get in touch?

Absolutely—even just by lifting the phone to our contact centre.

10:15  

Thank you for being so open; I am really interested in what you have said. If more people are having to resort to freedom of information requests, does that mean that SEPA is getting bogged down with such requests?

We have been, but over the past year, we have made good inroads into that.

A year or so ago, 10 per cent of requests were being dealt with in the time allowed for the process. In July this year, that figure was up to 80 per cent, so we are moving. We are putting more resources in, but it is, and will continue to be, a challenging area.

For my final question, I will pivot back slightly to funding and resource. There has been some pretty harsh criticism; I am sure that you will have read it, just as we have. Kim Pratt of Friends of the Earth Scotland said—this was in The Ferret, which did a big investigation—that,

“Three years on, the excuse that Sepa is still recovering from a cyber attack is wearing thin”.

That might be quite hard to hear. I go back to the comments from SEPA’s two former CEOs, who are very concerned about your funding situation. The question has been asked: is SEPA a priority for the Scottish Government? Perhaps I can put that question to you, Mr Harley. Do you feel that SEPA is enough of a priority for the Scottish Government?

We are very focused on moving forward from the cyberattack; it pains me to have to refer to it in this meeting, actually. We are moving forward, and we will build back better.

I think that we are being supported. The critical thing is prioritisation. We are working closely with Government officials, under the banner of public sector reform, to get a joint understanding of prioritisation of what we are going to focus on, as we move forward. That is what we are concentrating on. If we do that, we can manage with the finances that are available to us, but this remains a challenging time.

There are also efficiencies to be made in how we run our estate; for example, through sharing our buildings with others. We can do a lot of other things to be more efficient.

Thank you, Mr Harley. I wish you and your colleagues well.

I will hand back to the convener.

I am afraid that there are still some questions to come. One is from Jackie Baillie. I am sorry—I mean Jackie Dunbar. I do not know why I called you Jackie Baillie—I apologise. I know that I will pay for that later.

I have a supplementary to Monica Lennon’s first question about enforcement. David Harley said that nobody notices unless enforcement happens. That made me think, so perhaps David could expand on that a bit. Does SEPA go straight to enforcement for non-compliance, or is it the last resort? If you could talk us through that a little, it would be helpful.

Enforcement is the last resort. It might be worth sending the committee our enforcement policy, because that makes it clear that we will work with those who are non-compliant to achieve compliance, so we are very much a helping hand.

However, it depends on the circumstances. If people are trying to do the right thing, we will help them to do that. We wield the stick only when we need to do so, at the end of that process, which does happen. However, if somebody is a chancer or a criminal and is acting wilfully, we will come in hard with the big stick. We have various tools to do that, including writing reports to the procurator fiscal.

There is a range of approaches, and action very much depends on the circumstance.

Thank you.

Mark Ruskell wants to ask a question.

Staying with David Harley, the question is about the Environmental Standards Scotland “Air Quality Investigation Improvement Report”, which made a number of recommendations on how SEPA should progress its enforcement on air quality issues. What changes are planned on the back of that report? How has it affected your enforcement action on the ground?

Air quality management is shared among various agencies. We directly regulate large industrial emissions to air, and we support local authorities through the data that we provide and through modelling and advisory expertise on how they manage air quality in their localities.

We also have the ability to take action against local authorities if we feel that they have not done enough. We have not yet used that ability—we are working in partnership with local authorities—but we could consider doing so if we felt that local authorities were not doing enough to address local air pollution.

We are very aware of the investigation, but we think that we are doing okay.

Are no other changes planned on the back of ESS’s review?

There are no significant changes planned that I am aware of. I could follow up with more detail on specific recommendations, if that would help.

That might be useful. One thing that was highlighted to us when we did a mini-inquiry into air quality and ESS’s review was the positive role that SEPA plays in the development of air quality management plans—in particular, in working with local communities, enhancing data and assisting with public understanding of what an air quality problem is in a particular locality and what the solutions might be.

Given that one of ESS’s recommendations was that local authorities need to develop more of those plans, and to develop them within 12 months, are you able to resource that side of things? If a new group was set up in Perth or elsewhere to help to develop an air quality action plan for the area, would you be able to resource that demand?

We would probably struggle to provide a significant uplift in resources for that if it happened across the country in the way that it has happened in Glasgow, for example. We are very proud of the work that we have done locally with communities—it has gone very well. If there was a big uptick in that sort of work, that would be a challenge. That is grant-in-aid work; we cannot directly recover that cost.

That is useful to know.

I will move on to a bigger-picture question about the climate change plan and the biodiversity strategy. I would like to hear your views on how your organisations input into those. Is there a way in which we can create synergy in tackling the climate emergency and the biodiversity emergency, or are there tensions involved? Mention has been made of wind farm development. Are there ways in which we can maximise biodiversity gains while, at the same time, developing more ambition and more common ground on the climate?

Who would you like to ask first, Mark?

Nick Halfhide, to begin with.

That was a wide-ranging question. We have been very closely involved in developing the Scottish biodiversity strategy. We have also been working closely with Scottish Government officials on the climate change plan—the one about reducing emissions—and on the climate change adaptation programme. There is a huge amount of overlap on the three of those, particularly between the Scottish biodiversity strategy and the plan for reducing emissions, because about 50 per cent of Scotland’s emissions are related to the land in one way or another. They also offer a major opportunity for sequestering carbon through woodlands and peatlands in good condition.

Looking forward, as the climate becomes more chaotic, we know that one of our best insurance policies for dealing with that more chaotic climate is having a more robust natural environment. The science tells us that that is the way to go. On flooding for example, having a natural environment that is in better condition will not stop flooding, but it will reduce some of the challenges around it. The land being in better condition will also help with water scarcity and drought issues.

Therefore, the work on those areas is absolutely interconnected. In helping to develop the Scottish biodiversity strategy, we have had a very firm eye on climate change mitigation and on adaptation.

There are a few tensions in there—there are bound to be. You mentioned wind farms. The tensions to do with renewables are not insurmountable; they simply need to be worked through carefully.

With land use, there are maybe a few more intractable tensions. We have a finite amount of land—and of sea for that matter—and what we do with it is really important. There will be challenges in how we increase the land that we make available for nature and for adaptation and sequestration, and how we produce all the food that we need to eat.

Bioenergy crops are at the centre of one of the particular tensions within all that. Should we use land to grow crops for energy when we need the land to do all those other things, and where there may be alternatives to using bioenergy? That is the classic example of where there are tensions. However, I would say that, in 90 to 95 per cent of cases, there is a very good overlap—there is complementarity.

Do you agree that dialogue with industries is really important? For example, I have heard criticism from the onshore wind industry that NatureScot did not consult with the industry on the development of the peatland guidance. Are you aware of that? How does NatureScot prioritise good-quality engagement with the various sectors that obviously have a vested interest in developing land, including the renewables sector? Clearly, we need to find a way through on these issues and ensure that development can proceed, but in a way that supports the objectives on climate and biodiversity.

I was not aware of that particular criticism, but one of the things that we pride ourselves on is working closely with all the sectors with whom we interact. We work very closely with the renewables sector, but clearly it has a slightly different objective at times. For example, with the peatland code, that might be about enabling some applications to go ahead with conditions that the developer will then restore areas of peat. We have worked hard on that issue on the onshore side.

In the offshore industry, we have worked hard with the sector on where it places the turbines, how they are serviced and how conditions can be applied to help developments go ahead in a way that is sensitive to, and indeed in some instances helps to restore, the nature that is being displaced or killed.

We work closely with all industries, including the farming sector, the renewables sector and so on.

The criticism is that there has not been any consultation with the renewables industry—that is what I was told. Maybe you can go away and reflect on that.

Can I get a view from SEPA on how we square the circle of the climate and biodiversity objectives?

Like Nick Halfhide, I think that there are huge synergies between those two global issues and we should concentrate on where the synergies are—there is huge overlap. Essentially, when natural systems fail—we are talking about systems failure—you get degradation but, if you can rebuild the system, you get huge multiple benefits for many areas.

I will give just one example from the area of land management. Having more trees by rivers sounds very simple, doesn’t it? However, it increases carbon sequestration; protects from flooding, which will increasingly come about from climate change; protects the soil so that we enable sustainable food production; provides biodiversity improvement and potentially amenity improvement; and improves fisheries resilience as a result of shading from the trees. There are strategies that we can use that have big multiple benefits. In a very complicated world, we should concentrate on those win-win areas.

Have you fed that directly into the biodiversity strategy and the forthcoming climate plan?

Yes.

Thank you.

Both of my questions are about water quality and the first is probably for David Harley. Last year, we discussed with SEPA the issue of monitoring sewer overflows, and we raised the concerns of stakeholders regarding the small percentage of overflows that were being monitored. Can you give us an update on the progress that has been made since then? Has monitoring increased and what is the current impact of sewer overflows on our water environment?

10:30  

We are the regulator, whereas Scottish Water provides the monitoring, but I can give you an update. I will not speak on its behalf, but we hold it to account on its “Improving Urban Waters—Route Map”. That plan is fairly multifaceted, but it absolutely includes monitoring. I think that there are 3,000-plus combined sewer overflows in Scotland, of which about 10 per cent are monitored. However, Scottish Water is very quickly increasing that to a third, so 1,000 overflows will be monitored. That work is under way. I could not give you much more information on the exact timescales for that, but things are moving fast in that area.

On water quality and sewage, although there is a lot of concern from the public, which I understand, the impact on ecological water quality at a national scale is quite low compared to other impacts on the water environment, such as the impact of diffuse pollution from land use. That is not to say that there are not more urbanised areas of Scotland where that is a problem. The issue has been exacerbated by development and particularly by climate change and increasingly flashier flooding. Those areas need to be dealt with.

An interesting point about water quality is that good ecological water quality is not the same as good bathing water quality, which in turn is not the same as good potable water quality. There is a big public education opportunity here to ensure that people understand the difference between what is safe for bathing, and the requirements around that, and what is sufficient for good or better ecological water quality. We have a plan for both. We have the “River Basin Management Plan for Scotland 2021-2027”, which sets targets across all the impacts on the water environment across all our 3,000 water bodies. Where those have less than good status, there is a plan in place. It is a ministerial objective to improve waters across Scotland. That includes tackling sewage pollution, as well as pollution from agriculture, abstractions and a host of other impacts.

Scotland’s water quality is good. Eighty-five per cent of Scotland’s water bodies have good or better water quality.

Before I bring you back in Jackie, may I ask a quick question?

Mr Harley, you are kind of saying that the water might be fine from the environmental perspective but for God’s sake do not drink it and the last thing that you should do is swim in it. Is that what you are saying?

I am not saying that.

Oh, right.

I am saying that there are different requirements for different purposes. You can understand why you might have a very stringent requirement for drinking water. There is no bacteria at all in that water. There are no contaminants in it—

Well, that is because it has got chlorine in it—

It also undergoes other treatment, although I will not speak for Scottish Water. Drinking water is the highest standard. For bathing water, there is a very high standard, particularly in relation to the presence of bacteria and viruses. In those places that are designated for bathing, we monitor the water for those pollutants and require improvements accordingly, in line with European standards.

Is it fine to swim in every river in Scotland?

I do not think that it is fine to swim in every urban river in Scotland. That is why monitoring and public education and awareness are really important. The risks are much less at certain times of the year and under certain weather conditions, but after a large shower in the middle of summer would not be the best time to swim in some areas.

Thank you. You have just given me an excuse not to go swimming with my wife.

On the back of that, how do we find out what rivers are safe to swim in? I used to swim in the river as a kid and never gave it much thought. How does the public find out where it is safe and where it is not safe?

David, you said that you could not give me a timescale for when monitoring will increase to include a third of sewer overflows, but are we expecting it by the end of this year or the end of spring next year, for example? Are you able to give us any indication of that?

I think that we expect that to happen in the coming year. I do not have the exact information to hand. Scottish Water tracks its progress against those targets on its website; the project is called improving urban waters. We could forward that link and pull out the specific areas that are relevant. I think that your second question was about where it is safe to swim—

Where can I go for a dook?

We can definitively say that it is safe to swim at designated bathing beaches. In a situation where there has been heavy rainfall and a bathing beach might not be safe, information will be available on site to inform people about that. We have a role in providing that information. However, the safety of other swimming areas is tricky, because we do not know what land management practices are taking place. For example, you could go swimming in the Highlands somewhere where you think that it is absolutely safe to do so, but there could be a deer in the river a mile upstream.

I have been there.

It is impossible to give a definitive answer. However, there is a large public awareness element that we are very much part of. People need to be able to make decisions based on the environment and the conditions that they can see around them. Monitoring the combined sewer overflows is part of that, but there could be something much more holistic that helps people. There has been a huge increase in wild swimming over the past three years and an understandable increase in concerns about water safety.

I will put my next question to both of you. I will go to Nick Halfhide first, so that David Harley can have a break and a drink of water.

There is a programme for government commitment to develop legislation on the adaptation of water infrastructure to deal with future water scarcity. How is water scarcity impacting on your organisations’ functions? What role would you like to or do you expect to have in developing the new legislation?

For our organisation, the main impact of water scarcity relates to protected sites and protected species. If there is a period of drought, we will work closely with Scottish Water, SEPA and local authorities on any use of alternative water sources. If their backup water source is, for example, a protected site, we will work closely with them on what water levels might be appropriate to use before that site is adversely impacted. There have been live cases of that happening on Skye; there was one this year. We are expecting an increase in that, because all the research that we have seen suggests that there will be more severe and more regular periods of drought throughout Scotland as climate change takes place.

There is also an impact on species. Most water species are reasonably mobile, so our greatest concern is for freshwater pearl mussels. In periods of drought, we will work closely with bodies including SEPA on whether or not to move mussel populations to deeper water. That happens regularly in one or two rivers, particularly up north. It is tricky, because we are not sure that the survival rates of those creatures is higher after they are moved. Sometimes, it is better to leave them where they are and there is a judgment to be made depending on the circumstances. That is how future water scarcity specifically impacts our role.

I will turn to the second part of your question about what role we would want to play in developing new legislation. We are not a leading light, as it were, in the water world, but we would want to make sure that the interests of our protected sites and protected species were taken into account as any regulations were brought forward. We know from the Scottish biodiversity strategy and, as I mentioned, from the climate change adaptation programme, that it is not just our protected sites that are important—those sites make up only 18 per cent of land the moment. All our land matters and we need to make sure, even for sites that are not designated, that the approach to how we manage our water resources is given much higher priority, whether that is in farmland, our uplands or elsewhere.

We have rather taken water for granted. Yes, it rains a lot, but all the climate change projections suggest that we will have to look after our water resource as if it were much more scarce.

It is interesting that, when considering how the situation in north-east Scotland might progress in the future, we are looking at strategies that places such as East Anglia in England have not only for water management in drinking water and agriculture but for addressing the impact on protected sites and species.

I should probably declare my interest as the nature champion for sea trout, which I discussed in my recent members’ business debate.

I ask David Harley to respond, please.

We are more directly involved. The past two summers have been busy for us as we have put in a lot of effort and done good work to help the country through two water scarcity incidents.

That is why climate change resilience is right up there in our priorities. The issue is not just having too much water around the country but having too little.

Our main roles involve expertise and information. We are the organisation that must understand the risks going forward and project where things are going to get difficult in the country within an event. We must also have the long-term understanding.

We are proud of our weekly report. Throughout the summer, we produce a really factual two-page weekly report that offers a helpful service to the country in an elemental way. We also regulate abstraction, so we understand where water is being taken from the water environment, and we regulate through the standards that are in licences for abstraction.

We have a water scarcity plan. When we find ourselves in a water scarcity situation, the plan has a stepwise series of actions that range from providing advice in the early stages and working with operators on how they can be more water efficient to removing an operator’s ability to take water. There have been times in the past couple of years when we have had to do that, which is challenging for all who are concerned.

We are working closely with Government officials on the legislation that you mentioned. We are discussing whether we could have a more defined role in assessing water scarcity in relation to private water supplies. We work closely and we have joint multi-agency teams that are working with the Scottish Government on the legislation.

I have no further questions, so I hand back to the convener.

Mark Ruskell has a question about water quality and a further question after that.

I will go back to what David Harley said about the bathing water quality designation process. My understanding is that any application for bathing water designation in Scotland is required to meet a minimum threshold of 150 daily users. That differs from England and Wales, where there is no threshold for daily users or the number is much lower—I think that it is about 40.

Is SEPA looking at reforming that and making suggestions to ministers? Your point was that the situation is all fine in designated bathing water quality areas, at least over an entire season, but if an area where people regularly wild swim cannot be designated, who will monitor it? How will we get a partnership approach to address the problems of pollution in areas that people use, but not at a level that is above the threshold of 150 daily users?

I am aware of the issue. Ministers make such decisions, and we support the Scottish Government with that process.

I think that what you suggest could be done. Improving water quality in such areas would have expenditure implications that would not be insignificant if we had double or treble the number of designated bathing waters. As I said, environmental standards are different from bathing water standards, and that would have to be brought into the mix, but it would be for the Government to weigh up the pros and cons.

10:45  

Okay, thanks. I will stick with David Harley for my next question, and then I might bring Nick Halfhide back in. I want to ask about the Retained EU Law (Revocation and Reform) Act 2023, which is now in place, although the dramatic cliff edge of a lot of EU legislation being rescinded did not materialise. You have perhaps noted the committee’s interest in the withdrawal of the legislation on the national air quality performance framework and the lack of clarity about what it will be replaced with. Does SEPA have reflections on the 2023 act and where we are now, and on its implications for environmental standards?

It would really be for Scottish Government officials to manage that and work through it. We have not seen a significant shift in what we do, and we do not expect to. For example, in the water environment, we have not seen any change in expectation around the river basin management planning process—which is quite powerful and is driven by the water framework directive—and we welcome that. We have not seen a significant shift at the coalface.

Okay. Nick, do you have any reflections on that, in relation to biodiversity provisions, for example?

Yes. I have two points to make. One is that we have also not seen much change overall in terms of continued engagement and alignment with laws that originally came from Europe. However, we are unsure what impact the new legislation at Westminster will have on the supremacy of EU case law. That is still unclear. Although we do not expect it to be clarified by 1 January, it is a potential area of concern in the medium term because we rely on that case law quite a lot. If it were no longer relevant, that would have an impact on some of our decisions about licensing in particular.

Have you got any examples of that? Do you mean offshore wind, or are there other areas in which there is a weight of EU case law on the interpretation of key environmental principles that could now be challenged?

I do not have a specific example, but we have relied on that case law in some of our planning advice around European protected species, for example.

That draws us to the end of our questions. In case I do not do it after the next session, I thank both Nick Halfhide and David Harley for their evidence to the committee. It is always useful to hear what is going on and what has been achieved.

10:48 Meeting suspended.  

10:55 On resuming—