Chamber and committees

The Scottish Government has allocated an additional £100 million of funding for existing employment support programmes this financial year. This includes a further £25 million for National Transitional Funding, £10 million to recruit and retrain apprenticeships and £5 million for PACE.

Additionally the Scottish Government has invested £60 million in the development of a Young Person’s Guarantee. This will include:

• £30 million through local authorities to support local partnerships to deliver employability support
• £10 million directly to colleges
• £10 million additional funding for Developing the Young Workforce, the Scottish Government’s Youth Employment Strategy
• £10 million to support pre-apprenticeship activity

We are working with partners including local authorities, Scottish Funding Council, Skills Development Scotland to finalise plans that will set out how the additional investment will be used to increase the number and range of opportunities available to young people. Through Young Scot, we are also ensuring young people have the opportunity to shape the Guarantee.

This change was announced suddenly by the UK Government and, despite the obvious and substantial implications for the Scottish retail and tourism sectors, without prior engagement with Scottish Government officials. Accordingly, we have had no opportunity to carry out analysis of our own and none has been shared by the UK Government.

Since this announcement, the Scottish Government has received representations from a number of stakeholder organisations expressing concerns about the impact on trade and the wider economy. We share their concerns and do not believe that this is an appropriate juncture at which to make such an abrupt and significant change.

In response to each of your points regarding Accountable Officers in agencies outside the Scottish Government Main arrangements:

(a) All Accountable Officers are issued with a designation letter from the Permanent Secretary to the Scottish Government that specifically points to the accountability guidance within the Scottish Public Finance Manual, to which they must adhere. Accountable Officers are personally answerable to the Parliament for the exercise of their functions in accordance with section 15 of the Public Finance and Accountability (Scotland) Act 2000 and for the propriety and regularity of their use of resources. Regularity involves compliance with relevant legislation (including the annual Budget Act) and relevant guidance issued by the Scottish Ministers - in particular the Scottish Public Finance Manual. Accountable Officers are also issued with supporting guidance relating to the Public Sector Pay Policy publication.

(b) The Accountable Officers within each agency being established have separate delegated authority to negotiate staff terms and conditions, including pay and staffing structures, subject to their organisational resources and to Public Sector Pay Policy. To ensure any proposed changes to staff pay align with Public Sector Pay Policy, each agency is required to submit pay remit proposals for approval by the Scottish Government before entering into any trade union negotiations.

(c) Any proposed changes to pay and grading structures require consultation with, and approval from, the Scottish Government. The Public Sector Pay Policy Technical Guide sets out what should be taken into account when a public body, including agencies outside of Scottish Government Main arrangements, is proposing any such changes.

(d) All agencies are expected to adhere to guidance issued. It is the responsibility of the Accountable Officer to justify any departure from the guidance to the Scottish Government.

Table A provides the estimated unemployment levels and rates by gender, for May - July 2007 to May – July 2020, sourced from the Labour Force Survey:

Table A: Unemployment Level and Rate by Gender, May-July 2007 to

May-July 2020, Scotland

Forecasts of unemployment for Scotland are produced by the Scottish Fiscal Commission, who are Scotland’s official forecaster. Their last published forecast, from February 2020, was prior to the full impact of COVID-19 becoming known and consequently did not fully factor in the recent health and economic crisis. They are due to publish their next set of forecasts alongside the next Scottish Budget, expected in December.

In the interim, the Scottish Government has published several pieces of scenario analysis on the medium term outlook of the Scottish economy and labour market.

The latest analysis was published in the Chief Economist’s State of the Economy report on 29 September 2020. This highlighted that unemployment could reach 8.2% by the end of this financial year.

There are currently no official projections of youth unemployment produced by Scottish Government or external stakeholders. However, historically at times of recession, youth unemployment has risen to over double the overall rate. So we might expect a youth unemployment rate of 20% or more later this year and into 2021 Q1.

The Bank’s investment policies will take account of its legal obligations as a lender and investor, will be aligned with its investment strategy, and will incorporate the ethical investment standards that it is required to produce. Those standards will align with the Bank's objects and its strategic missions. In particular, we are establishing the Bank with an object of advancing equality and non-discrimination, and have consulted on a draft mission for the Bank focussed on investing in places and regeneration to reduce inequality, and improving opportunities and outcomes for people and communities.

The Scottish Government does not hold this information.

The current expectation is that Scottish Water will draw down all available borrowing in 2020-21.

No Licensed Providers have ceased trading since the start of the COVID-19 pandemic.

This is one of a number of financial implications arising from the Covid-19 pandemic and the position is being carefully monitored by Scottish Water and the Scottish Government.