Seòmar agus comataidhean

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.

Yes, that is a concern and I know you have taken evidence that has covered some of these issues already from COSLA and others, who will be closer to some of the practicalities of this. From a Government and Government agency point of view, we are in a position where we can access legal advice and we can take a view on things. We are typically talking about larger sums of money, bigger investments and so on. It makes the process more complicated, more difficult, more challenging and more uncertain, and, for smaller organisations that are dealing with the issues and trying to support economic development locally, those challenges are multiplied. It is too early to see examples of the impacts that you mention, but I have concerns the situation that you outline may well be the case.

On the second part of your question, which concerned what we can do about it, clearly, we will continue to challenge the UK Government on these issues, but we are open to having conversations about the specific organisations that may find themselves in that situation and how we could work with them to help them navigate the uncertainties that exist as part of this process.

You are absolutely correct, and you are right to raise the importance of a net zero Scotland. We have seen the developments with ScotWind this week, and there are many examples of Scotland’s globally leading position in many of the technologies and opportunities in relation to the just transition to net zero. We need to be in a position where we have the ability to provide support as we see fit within a set of rules that is transparent, clear and predictable. All of that is important.

If you are asking me whether there is a risk that, as a consequence of where we are at the moment with this bill, we will find it difficult, more time-consuming or impossible to do things that we would otherwise do, I would say that that is absolutely the case. There have already been examples where support has been delayed and we have had to deal with a more complicated process internally as a consequence of a lack of clarity on the guidance and where that takes us.

In answer to your earlier point, of course we agree that there should be subsidy control or state aid regimes in place. It is essential from a good governance point of view and from a global trade point of view that we have those rules at the global level, a bilateral level and EU level. We absolutely recognise the need for that because it works in both directions. It gives certainty to Scottish exporters as well as giving certainty to the steps that the Government and others take within Scotland. The key point is that there needs to be clarity and a process that allows those decisions to be clear in advance and allows for clear guidance about what can and cannot be done.

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.

We continue to push for amendments to the bill in the later stages. At the end of the day, it is a UK bill and the UK Government will take it through Westminster as it sees fit.

We will continue to make the case, argue for those amendments and work with others of a similar view to make changes where we can. However, as I said, the bill will progress through Westminster based on what the UK Government decides it wants to include. It is of concern that the amendments have not been taken on board, which is one reason why we are not recommending that consent be given to the bill.

No. Thank you very much for the questions. We have covered all the issues that we wanted to raise, and it is good to get the committee’s perspective on the issues.

Yes, we are very conscious of that. I know that the Cabinet Secretary for Finance and the Economy was with you earlier and that you spoke about the guidance and so on. Those issues are very much to the fore in terms of how we support local economic development. It is a priority for the Government and for me.

The issue will be the chilling effect. Risk aversion is part of the issue. We need to be open and clear with those in Scotland who may find themselves in that position. They may look at something and think that it is too difficult and that they do not want to take those risks.

For us to understand examples of that, it is important that they are brought to our attention. We are open to having those conversations and to looking for examples with local authorities and others of where that may be a risk so that we are aware of it and are able to work with those who might be affected and can help them navigate the process as necessary.

You have raised a few different issues. The lack of guidance suggests a lack of detail, which makes it difficult to take a view on some issues. The inclusion of agriculture, as I mentioned, is clearly a concern.

Our concern relates to the use of powers in devolved areas of competence. The UK secretary of state will have powers across the whole UK—they will have a whole list of powers with regard to the operation of the scheme, when it is up and running—but there is no equivalent power for the Scottish ministers in devolved areas. That imbalance runs against the devolution settlement.

We are concerned about that in principle, but we are also concerned about operational aspects, in relation to knowledge and understanding and the specific impact on Scotland. How events unfold in Scotland should have an impact on the nuances of any decisions that are made and on the relative importance of different decisions or subsidies, and the detailed knowledge of such matters is clearly in Scotland.

There is a point of principle about the powers and the erosion of the devolution settlement, but there is also the practical point that we are much closer to the issues than somebody in Whitehall would be.

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.

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.