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As part of Phase 2 of the enterprise and skills review, we will explore the feasibility of introducing a requirement for fair work practice for Scottish Enterprise and Highlands and Islands Enterprise account-managed businesses.

The Ernst & Young (EY) Attractiveness Surveys provide data on the number of Foreign Direct Investment (FDI) projects by country of origin. Table 1 provides detail on the top 5 countries in terms of the number of FDI projects into Scotland for 2012 to 2015.

Table 1: Top 5 countries of origin for FDI projects into Scotland, 2012 to 2015

Source: Ernst & Young Attractiveness Surveys

The Community Ownership Support Service (COSS) is being funded by the Scottish Government to support community-based groups in Scotland considering taking ownership of land or buildings.

This adviser-based service is being delivered Scotland-wide and aims to provide individual community groups and public bodies with a bespoke support service, including:

• Expert advice on all aspects of asset transfer

• Training courses on the asset transfer and asset development process

• Sign-posting to other support agencies

• Web access to information on good practice, toolkits and case studies.

Communities are also able to link into Development Trusts Association Scotland’s wider network to explore the wide range of business models being adopted by other communities throughout Scotland and across the UK.

Other options that community groups might wish to explore include the Scottish Land Fund and BIG Lottery Scotland.

The Scottish Government publishes Scotland’s Spending Plans and Draft Budget which sets out the Scottish Government’s spending plans on their Strategic Priorities for a specific period and most recently in 2016-17 publication (http://www.gov.scot/Resource/0049/00491140.pdf) a strategic vision for Scotland’s public finances over the Spending Review period to 2019-20.

Scottish Development International (SDI) is a tripartite arrangement between Scottish Government, Scottish Enterprise and Highlands and Islands Enterprise. SDI provides support for companies to establish and grow their businesses in Scotland and help companies to expand their international trade.

A breakdown of SDI’s budget in each year since 2011-12 is provided in the following table:

SDI Operational Budget

* Figures rounded to nearest hundred thousand

The impact on each Scottish Airport will be determined by how airlines and passengers respond to increased capacity being available. Potentially, airports with no service or limited services to London Heathrow could benefit, with wider benefits for Scotland from improved connectivity for business and new opportunities for inbound tourism.

Expansion at Heathrow Airport offers the potential for the establishment of a new supply chain hub at Glasgow Prestwick Airport to support the building of the third runway. Heathrow Airport will work with the Scottish Government to investigate this opportunity.

The Scottish Government announced its support for a third runway at Heathrow after securing a number of other key commitments for Scotland, including the creation of up to 16,000 new jobs and a minimum of £200 million worth of construction-related spend during planning and construction. There will also be a significant marketing campaign at Heathrow Airport worth £1.5m and beginning in 2017 to promote all that Scotland has to offer. To support existing services and incentivise new ones, from January 2017 there will be a reduction of £10 per passenger on charges paid by airlines operating services from Heathrow to Scotland. There will also be a £10 million route development fund to further help support new domestic routes.

By the end of the last financial year (31st March 2016) the Scottish Government had invested £20.8 million in loan support in Glasgow Prestwick Airport. The breakdown of this investment by year is £4.5 million invested in 2013-14, £6.3 million invested in 2014-15, and £10.0 million invested in 2015-16.

We expect all loan funding will be repaid, plus interest.

The Minister for Transport and the Islands recently met with the CEO of Seatruck to discuss the issues around staff pay on the freight vessels currently operating on the Northern Isles ferry service. Following a constructive meeting, further work will be undertaken by Seatruck and Transport Scotland to try and resolve the current situation.

The Minister has also written to the UK Government to ask them to take action on the National Minimum Wage and seafarers. Scottish Ministers are currently considering all available options and legal implications to promote fair work practices, including collective bargaining and payment of the National Minimum Wage and, where possible, the Scottish Living Wage in their contracts.

The Minister for Transport and the Islands most recently met with STUC and a number of transport unions, including the RMT, on Thursday 10 November 2016, where the issue was discussed. Work is being taken forward to try and resolve the current situation.

We have published statutory guidance “Addressing Fair Work Practices, including the Living Wage, in Procurement” which sets out how public bodies should encourage contractors to adopt fair work practices, including the Living Wage for workers engaged on delivering public contracts. Individual public bodies are responsible for their own procurement activity and effective contract management and monitoring should be undertaken to ensure that fair work practices, including the Living Wage, continue to be applied throughout the duration of contracts.

The Procurement Reform (Scotland) Act 2014 requires public bodies with an annual regulated procurement spend of £5m or more to produce a procurement strategy setting out, amongst other things, a statement of their general policy on the payment of a living wage to people involved in delivering public contracts. These bodies will be required to produce a report at the end of their financial year 2017-18 outlining whether their procurement activities complied with the strategy, and where they did not, how they intend to ensure compliance in the future.