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Marine renewables and offshore wind will make a significant contribution to our renewable energy targets and contribute to our wider environmental objectives, particularly in relation to climate change.

The climate change benefits associated with marine renewables and offshore wind will benefit marine biodiversity as well as society and the environment more generally. It will provide Scotland with a better mix of sources of power by reducing dependence on fossil fuels. The development of a marine renewables and offshore wind industry will also contribute to economic growth, including significant potential for new sources of employment in coastal communities.

The potential impacts for biodiversity are dependent on the design of wave, tidal and offshore wind projects, construction and operating plans, location of the proposed development and biodiversity features of interest. The potential impacts include habitat loss, disturbance of marine species, collision risk with marine species and barrier effects to migration of marine species. Developments also have the potential to provide artificial reefs, through the placement of manmade structures on the seabed.

The Scottish Government is taking a planned approach to the development of wave, tidal and offshore wind energy sectors in a sustainable manner. The Scottish Government undertook a Strategic Environmental Assessment (SEA) to examine the wider environmental effects of wave and tidal power which was published on 31 March 2007.

Marine Scotland proposes to undertake an SEA maintenance exercise to update the 2007 SEA. This will incorporate Habitats Regulations Appraisal to assess potential impacts on Special Areas of Conservation, and Special Protection Areas and to ensure that the requirements of the Habitats Directive are met. Proposed developments will also be subject to environmental impact assessment including Habitats Regulations Appraisal at the project level. The marine licensing process will also consider the potential for impacts on European protected species.

The Scottish Government is also supporting a research programme on the environmental impacts of marine renewables to increase knowledge of the likelihood of potential impacts, provide a better baseline for environmental assessments and research mitigation strategies. Surveys have also been undertaken in the Pentland Firth to improve knowledge of the distribution of marine biodiversity features and inform licensing decisions.

Applications for funding through the National Renewables Infrastructure Fund will be considered by Scottish Enterprise (SE) and Highlands and Islands Enterprise (HIE). SE and HIE both require that projects obtain the necessary planning consents prior to the provision of funding. This will include environmental impact assessment of projects, where it is required.

A Strategic Environmental Assessment of the National Renewables Infrastructure Plan has been undertaken in accordance with the Environmental Assessment (Scotland) Act 2005. The results may be used by the site owners when progressing their site-specific proposals.

The National Renewables Infrastructure Plan (N-RIP) Stage 1 and 2 reports identify Scotland''s key locations that can support the development of a globally competitive offshore renewables industry. The reports set out the indicative infrastructure requirements and associated economic returns that could be generated. All projects associated with N-RIP will be required to follow planning and/or consenting procedures, including consents under the Harbours Act and/or the Town and Country Planning Act, and (in future) dredging licences under the Marine (Scotland) Act where dredging may be proposed.

In respect of planning, the National Marine Plan will take cognisance of the N-RIP. Scottish Government officials will also be working closely with planning authorities to ensure that N-RIP objectives are taken into account in the preparation of main issues reports and development plans.

In 2010, discussions were held between the Scottish Government''s SEA Gateway and Scottish Enterprise and Highlands and Islands Enterprise regarding the need for environmental assessment of the National Renewables Infrastructure Plan (N-RIP).

A strategic environmental assessment (SEA) was undertaken of the short-term and medium-term sites (20 in total) included in the N-RIP. The environmental report and the Stage 2 N-RIP report were published for public consultation in September 2010, for a period of 10 weeks.

A Habitats Regulations Appraisal (HRA) of the N-RIP is currently underway and is due to report in January 2011.

All Scottish Government expenditure is being closely monitored and managed so that there will be a very small underspend by the end of the financial year, in line with recent performance. HM Treasury has advised that it has abolished the existing end year flexibility arrangements which means that we will not be allowed to carry forward any underspend from 2010-11 to a future financial year.

The very small underspend anticipated will be after our budget for 2010-11 has been reduced for the sum we are planning to carry forward to 2011-12 to support the capital programme in that year.

Funding for flooding projects, including that allocated to the City of Edinburgh Council, has been rolled up in the local government finance settlement since 2008-09. As such, it is a matter for individual councils to decide how they allocate the total funding at its disposal to meet its own local needs and priorities, including those for flooding schemes.

For its part, the Scottish Government has agreed with COSLA that in allocating the available capital grant it provides amongst councils, it has also maintained funding for specific elements within the total. The Scottish Government has therefore protected the funding allocations for flood prevention schemes, including the Water of Leith Scheme that was approved earlier.

The Forestry Commission is a cross-border GB body that develops and delivers forestry policy on behalf of the Scottish, English and Welsh administrations. The statutory powers and duties of the commission are vested in the Forestry Commissioners. The future of the Forestry Commissioners will be a matter for discussion between Scottish, English and Welsh ministers.

The Scottish Government may, by virtue of the Public Services Reform (Scotland) Act, seek, by order, to amend, transfer or delegate the functions of the Forestry Commissioners as they relate to Scotland. A proposal to abolish the Forestry Commissioners would require legislation at Westminster, and a Legislative Consent Motion, and we would expect such a proposal to be discussed and agreed by Scottish, English and Welsh ministers.

The Scottish Government has no plans to change the role of the Scottish Forestry Commissioners.