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Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 5 May 2021
  6. Current session: 12 May 2021 to 16 June 2025
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Displaying 1144 contributions

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Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

We must have clarity. As has been said, there are questions about exactly how things will operate and there are concerns about the lack of guidance. There are also concerns that decisions would go to, and fall under the powers of, the secretary of state. Decisions will be taken at the UK level without regard to what is happening in Scotland or in other devolved Administrations.

On whether there should be more detail in the bill, and certainly in the guidelines, on there being different scope to act in different parts of the country, we support that call.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

That is one of the areas in bill in which it is important to have guidelines. We have talked about the Scottish National Investment Bank. Much of what it would do would fit in that space. More detail and clarity in the guidelines as to how that aspect will be looked upon in the regime would be helpful.

11:15  

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

To be honest, I am not fully up to speed on where we are with the membership of the unit. Hilary Pearce may have more up-to-date information.

From our point of view, we want proper regard to be given to the specific concerns of and issues in the devolved Administrations in relation to the membership of the unit. To do their jobs properly, it is essential for the unit’s members to understand the various ways in which things are done differently in the devolved parts of the UK.

Hilary, are you aware of the situation with membership of the unit?

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

Yes. It is already the case that we work within the interim regulations that are in place. As I said earlier, there have been examples already where we have had to make decisions on whether we feel support is within or outwith the rules, vague as they are. We will do our best to work within the legislation, but that might be more challenging, complex and difficult than it need be.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

I looked at some of the evidence from last week and that is absolutely the case. There has been a shift from a much more rules-based process to one that is more open. The principles are laid down, but the most important part is how different people and organisations interpret them. The risk of organisations not taking steps that they properly should in terms of economic development and other opportunities is a concern.

I will hand over to Hilary Pearce in a minute to give a bit more detail on the conversations that our officials have had with the UK Government about guidelines and some of the specific gaps there. Suffice it to say that, although there have been a lot of conversations with the UK Government at ministerial and official levels, the reality is that the UK Government has been slow to come forward with the details of what the guidelines look like underneath the very broad-brush principles. That matters because organisations need to understand where the lines are, what is allowed and what is not allowed in various scenarios, which may not be obvious from the broad-brush principles.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

Yes, it would. One power in a list of powers that the secretary of state will have under the bill is that he or she will be able to operate in devolved areas and on devolved matters. We rightly believe, as do the other devolved Administrations, that equivalent powers should be available to devolved Administrations to do exactly as you have said and to address issues. For example, if we saw a potential distortion, we should be able to refer the matter to the CMA and go through the process in the same way as the secretary of state can.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

Absolutely. We are already seeing that. There are examples—I will not go into the details for reasons of commercial confidentiality—in which our legal teams have had to have a good look to understand whether we are able to move forward. They take, as they often do, a very safe view on what is and is not allowed. In the absence of the pre-authorisation process that existed previously, there is an inclination to operate on the side of safety, which means that we have to take a different view on things that we might have done in the past. That is obviously concerning.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

We have made that point repeatedly at every opportunity, as I said earlier. There have already been situations relating to support for investment in which there has not been the clarity that there has been previously. The view of lawyers is to be safe rather than to move things forward, so we have had to have discussions in that context, which is concerning because it leads to delays in the processes. As you said, it has a chilling effect and slows things up. In some cases, it might prevent things from happening that otherwise would have happened, because we do not have clarity in advance on what is and is not permissible. Taking a safety-first approach could lead to advice being given that we should not go ahead with something, which is a concern.

As I said, that issue and many others, including the issue relating to the bank, have been raised repeatedly with the UK Government at official level and at ministerial level.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

It has had consultations at a general level but I am not aware if it will do consultation on the guidelines—Hilary Pearce might know that. You are right to say that we are waiting to see what it will come forward with. The streamlined area is an example of one where the secretary of state has powers that the devolved ministers do not have. That is concerning because, if there was any debate about what the streamlined powers allow or do not allow or how they operate and when they would operate, the decision would be up to the secretary of state and, even if the issue involved a devolved matter in Scotland, we would not have any ability to act in the same way.

Economy and Fair Work Committee

Subsidy Control Bill

Meeting date: 19 January 2022

Ivan McKee

It is possible to identify more disadvantaged areas, outline what those disadvantages are and have scope to deploy support in a different way to those areas. Such a process has been in place previously through EU processes; it has different categorisations of regions.

As I have said, from a regional economic development point of view, we are focused on supporting all regions and communities in Scotland to maximise their potential. That might require support to encourage investment or other activity. We want to be able to take those steps in a different way, depending on the specific needs of different parts of the country. It is important that we have that ability and that there is clarity around that, but there is no provision for that in the bill. It is interesting how that works against the UK Government’s stated aim of levelling up. That is another area in which there is a lack of clarity as to exactly how the measures will operate.