Chamber and committees

We have tried to ensure that the marine fund and any funds that we have align with the priorities that we have set out. We set out priorities in our future fisheries management strategy, but—again—a lot has changed over the past year. That was the first year of the marine fund Scotland, so we are seeking to evaluate the programme and look at what was achieved as a result of the funding that was spent. We want to ensure that, when we develop the strategies for these funds, they meet the ambitious priorities and commitments that we, as a Government, have set out and that they seek to achieve those goals.

If the committee would appreciate further information on the projects that have been awarded funding so far through the marine fund Scotland, and on the criteria that have been used, I would be happy to send that on.

You are absolutely right. The review will enable that to happen because it will provide the necessary resources to deal with the backlog, which should then enable the commission to look at some of the other issues that you have talked about, such as tackling derelict crofts, attracting more new entrants and implementing the crofting development plan.

We will continue to monitor the matter closely. I have regular engagement with the convener and the chief executive of the Crofting Commission to discuss on-going issues, look at the improvement plan and ensure that improvements are being made. The extra resource is so important because it will enable that work to take place.

I completely understand the points that you have raised. When I was in Shetland in the summer, I heard directly about the increased construction costs and various other issues that people face. The islands bond has never been seen as a blunt tool that will fix all those problems. I have been asked questions in the chamber about the islands bond, and it is just one strand of work that we are looking at to try and stem depopulation and support our populations in fragile communities. Many areas are involved in ensuring that we tackle the other issues that can lead to depopulation. The islands bond is one element that we feel can help to retain populations in fragile areas and repopulate depopulated areas.

As we have developed the bond, I have been keen to make sure that we undertake as much engagement as we possibly can so that, if we implement the measure, we do it right and in a way that will work. There have been a lot of misconceptions about what the bond will do and what it will look like, but that is why engagement is so important. Officials have undertaken extensive engagement so far, and that will continue. That has led us to propose the funding that we have in the budget this year. When you break it down, it looks like it may help only a specific number of households, but it is based on the engagement that we have had, and we are reflecting on the feedback that we have received. As you can imagine, there have been lots of different opinions on what it might look like and the different ways in which it might work.

It is really important that we listen, and that is exactly what we have tried to do. The funding will allow us to test some of the different approaches to the delivery of the island bond at a scale that will enable us to measure and understand the challenges and opportunities that are associated with the policy. The learning from that will allow us to develop a more effective and meaningful intervention for future years.

The commitment still remains with the funding for the islands bond, but the policy is being developed in that way purely based on the listening and learning that we have done along the way. That engagement will continue.

I will have to ask Caro Cowan for the specific information on that.

The extra investment that we have made for Marine Scotland has been vital because, since the UK left the EU, nearly 500 new obligations that relate to the marine environment, which were previously undertaken by the European Commission or by member states, have been transferred to the Scottish ministers; there are also 86 new powers. That means that we need to have more resource and to focus resource on managing all of that.

We also have ambitious targets when it comes to what we want to achieve in the marine environment. In the Bute house agreement with the Scottish Green Party, we have committed to establishing highly protected marine areas and to implementing management measures for our marine protected areas and our priority marine features. Given all the commitments that we have made on enhancing conservation and our marine environment, it is vital that we have the resource to put into supporting that work.

In an earlier response, I touched on the work that needs to be done on offshore renewables. Again, it is vital that we have in place the resource to enable us to support and deliver on all the commitments that we have set out and the transition that we need to make in some of those areas. That is what that £10 million will enable Marine Scotland to do.

Our initial commitment was to progress with three islands as part of the carbon-neutral islands project, but we have now extended that to six. We have developed internal and external working groups to consider the criteria that will inform the selection of islands that will be part of the project, and we are working across Government with existing policy and funding approaches to ensure that we are not duplicating work in other areas.

We have recently commissioned a mapping exercise, which will contribute to the knowledge of carbon accounting and emissions reductions on islands, ensuring that we avoid duplication when we begin the implementation phase of the project.

We aim to publish a report by summer this year, setting out the steps that we will take to support the six islands to move towards carbon neutrality. The £3 million that we have identified as part of the budget will support the implementation of that over the course of the coming financial year. As with the islands bonds, we want to engage and consult as we progress with the plans, because that will be critical as we proceed.

We also have other important markets to which we now no longer have access, unfortunately, because of Brexit. Again, that is why we had the common frameworks process, with which all Administrations engaged in good faith. That process is about helping to manage policy divergence, which is not a threat to any one Government—there was divergence when we were members of the EU. All that we ask for is the ability for Scotland to continue to do that.

If the Subsidy Control Bill is passed in its current form, it will constrain our policy choices in the future. For example, we have support payments for our less favoured areas that do not exist in other parts of the UK, and our ability to continue to offer such payments might well be put at risk, given the powers in the bill as it is currently drafted.

It is not only the Scottish Government that is raising those concerns; the same concerns have been raised by the Northern Ireland Executive and the Welsh Government. They, too, are seriously concerned about the powers in those two pieces of legislation, which completely undermine the collaborative work that we have all done to establish the frameworks. That might lead the devolved Administrations to lose faith in the process altogether, because the UK Government is trying to retain control of those powers and to constrict our policy-making powers.

No—that is one area, but it is a fairly substantive area, given the size of the payments involved and the fundamental nature of the support for our whole agricultural sector.

We have already committed to maintaining that level of spend throughout this session of Parliament. I know that the committee is aware of the work that is under way with the implementation board to help to design and develop our future policy.

It is not possible for me to give the committee the full financial impact. The problem with the Subsidy Control Bill is that it could constrain our ability to make future policy decisions so, sadly, it is not possible to quantify the impact. When I spoke about figures earlier, I was talking about the scale of the overall investment that we make in our agriculture sector and the fact that our policy choices about how to direct that investment are constrained.

Absolutely. Some of the concerns that I have outlined about the Subsidy Control Bill and the United Kingdom Internal Market Act 2020 are shared concerns. That is why we have continued to raise them with the UK Government.

I will further explain some of the impacts that we can expect from the Subsidy Control Bill. Agriculture is fully devolved. Farmers and crofters in Scotland face challenges that do not exist elsewhere in the UK, but the principles that are set out in schedule 1 to the bill put at risk our ability to develop future policies that are tailored to address those challenges. For example, the incoming coupled support payments play a vital role for many of the businesses that operate in some of our most remote and constrained areas, but they would be incompatible with the principles that are proposed in the Subsidy Control Bill, particularly those about encouraging a change in the economic behaviour of the beneficiary.

Agriculture is carved out of many subsidy control regimes and is covered by the World Trade Organization agreement on agriculture, so it does not make sense for it to be included in the Subsidy Control Bill. The UK Government told us that a consultation was undertaken and that the vast majority of respondents agreed to agriculture’s inclusion in the bill. We have asked for that consultation information to be shared with us but, as yet, it has not materialised. At first, we were told that it could not be shared because of data protection legislation. We asked for anonymised examples to try to understand the rationale for including agriculture in the subsidy regime, because it is unusual for it to be included in that way.

The Subsidy Control Bill could also prevent us from retaining alignment with the EU if schemes that we want to develop and adopt are incompatible with the UK regime. The Minister for Business, Trade, Tourism and Enterprise, Ivan McKee, and I had a meeting with the relevant UK minister this week to discuss some of the significant issues that we have with the bill and to try to better understand the rationale for some of the decisions that have been taken. It is unusual for agriculture to be included given that it is carved out of so many other regimes and that there is sector cover for it under the WTO agreement on agriculture.