Chamber and committees

In recent weeks, anglers in at least 18 Scottish rivers and netting stations in the River Esk and Tweed have reported historically unprecedented numbers of fresh run non-native pink salmon. As at the end of August, Fisheries Management Scotland (FMS) have records that approximately 140 have been caught in Scotland.

Pacific pink salmon were originally introduced to some Russian rivers in the 1960s, have slowly spread westwards and have now colonised some northern Norwegian rivers. The fish spawn at a different time from Atlantic salmon, have a 2-year lifecycle and generally spawn in summer (and often in main river channels, in the lower reaches of rivers, and sometimes in upstream tributaries).

Whilst it is theoretically possible that these non-native species could establish themselves in Scottish rivers, the higher water temperatures make this unlikely. However, since the risks have not been formally quantified the Scottish Government is in on-going dialogue with the GB Non-Native Species Secretariat to establish a formal, peer reviewed, risk assessment particularly in respect of the potential impact this could have on Scotland’s wild salmon populations.

In parallel, Marine Scotland Science (MSS) is undertaking a series of investigations which will allow refinement of the GB risk assessment to local Scottish rivers and will inform decisions on subsequent management options.

MSS is using information from its National Temperature Monitoring Network to assess the likelihood of successful spawning by pink salmon across Scotland.

If viable eggs are available from the pink salmon, then MSS will test them in the marine laboratory in Aberdeen to assess the temperature limits for successful development and hatching. Ideally, we would like to obtain viable eggs by stripping pre-spawned fish. However, if this is not possible or we obtain insufficient eggs via this method, we are also planning the excavation of redds, at a point where the eggs are ‘eyed’ and therefore at their most robust. If both methods fail, MSS will use published data from other stocks.

MSS is also working with Fisheries Management Scotland to monitor the success of pink salmon eggs deposited within certain rivers, using specially designed hatching chambers that hold eggs within the river substrate with attached surface chambers which, together, can be used to assess survival and emergence of eggs/fry.

MSS will use genetics methods to assess the likely origins of the fish. This objective will be achieved by comparing the genetics of the invasive pink salmon with a library of pink salmon genetics signatures collated by International collaborators.

Meantime, our Fish Health Inspectorate will sample any fish which are moribund or displaying clinical signs of disease in order to identify parasites and/or pathogens which they may carry.

District Salmon Fishery Boards also remain empowered to take a different course of action, such as destroying redds and trying to net out the fish. Where necessary the Scottish Government will considering licencing them to do so. One licence application is currently being considered.

SNH is conveying a meeting of experts, including participants from Norway and Denmark, on 21 September to share their experiences and management activity surrounding pink salmon.

The information to date suggests that Scottish rivers are witnessing what is termed an odd year cycle. If this is confirmed, the Scottish Government will continue to work with Fisheries Management Scotland, its member boards and trusts, SNH and SEPA so that we are fully prepared, with clear strategies, if/when pink salmon return in 2019.

The Scottish Government recognises the value of Modern Methods of construction including modular approaches and would encourage all public authorities to consider its use on all construction projects where appropriate.

The Scottish Government wrote to the European Commission on 21 June to request an extension to the end-June deadline for CAP Pillar 1 payments. The Commission has responded to indicate that it does not propose to offer an extension.

The request for an extension formed part of the Scottish Government’s contingency planning for 2016 CAP Pillar 1 payments. We will not know the precise amount of any late payment penalties that will be applied for many months to come, because these are calculated at UK level in line with EC accounting cycles which, in this case, extend well into 2018. It is worth noting that the position in relation to penalties for 2015 is not yet finalised, nine months after the extended payment deadline for 2015 payments of 15 October 2016.

It is also worth noting the framework which applies to any penalties. Each year, there is a penalty free sum available to Member States of 5% of the total value of payments made by the end of June. Where late payments are made between 1 July and 15 October, penalties only occur if total expenditure exceeds that 5% limit. Recent good performance in making payments in Scotland during June and across the UK as a whole has significantly reduced the risk of late payments exceeding the 5% level. Current forecasts from all of the UK paying agencies suggest that there will be no penalties in relation to the remaining BPS and Greening payments made between 1 July and 15 October – these schemes account for around 98% of CAP Pillar 1 payments – and only marginal potential penalties for the Young Farmer and Voluntary Coupled Support schemes. Scotland is the only part of the UK with Voluntary Coupled Support schemes which were added to Pillar 1 following discussion with stakeholders.

However, in line with the Scottish Government’s prudent approach of taking all available contingency measures to mitigate the risk of financial penalties, a further request has been made asking the European Commission to reconsider and keep open the possibility of an extension if needed.

Since my announcement on 2 February, officials have met with counterparts from the European Commission, undertaken a series of meetings with a range of stakeholders across the Clyde and Hebrides (including Gourock–Dunoon) and Northern Isles ferry networks and considered legal and policy implications related to the application of the Teckal exemption and State aid rules.

The combination of this engagement with the Commission and consideration of the legal and policy implications has led to the conclusion that a direct award of an operating contract to a Teckal compliant body would be compatible with the Maritime Cabotage Regulation. This still necessitates a review of David MacBrayne Ltd. and its operating companies to determine which changes would be required to the structure and governance of those companies to ensure that they were fully compliant with the strict control and functions tests of the Teckal exemption.

It will also be necessary to undertake more detailed consideration of State aid rules before determining whether it would be possible to make a direct award to an in-house operator. This will require a full analysis of the Altmark criteria, namely the fourth criterion - which, in the absence of a public procurement procedure, requires that compensation for delivering the public service obligation does not exceed the cost of a typical, well-run and adequately equipped undertaking.

The fourth Altmark criterion is a particularly challenging requirement to satisfy. Any proposed in-house operation will require to be benchmarked against a number of typical comparator operators in the ferry sector and this will most likely require further legal and financial consideration and more detailed discussion with the Commission. The level of engagement and detailed information required will almost certainly lead to an extended timeline to that initially envisaged for the full consideration and completion of the review. This will extend the timeline for the review beyond the autumn period, when a report on the emerging findings of the review is due for publication.

This extension means that we will have to consider the implications for the next contracts for the Gourock-Dunoon and Northern Isles ferry services, and we will lay out the way forward for both contracts in due course.

In terms of stakeholder engagement, officials have held meetings with the STUC and the trades unions to discuss the purpose and progress of the review. Officials have also met with a range of key stakeholders in Glasgow, Oban, Benbecula, Stornoway, Orkney and Shetland. Initial soundings were that there was, in general, more local support for a direct award to an in-house operator for the Clyde and Hebrides networks, while Northern Isles stakeholders either expressed a more neutral stance, or a preference for the tendering of future contracts.

The review is also considering the case for continued tendering of the ferry services, including the cost of tendering, the wider economic and financial implications of tendering, the empirical evidence collated from the recent Clyde and Hebrides ferry services tender and the views of local communities and key stakeholders.

The Government's preference is to award the contract to an in house provider. It is, however, important that the outcome of the review is not prejudged, or to create expectations that further consideration of State aid rules, and the Altmark criteria in particular, will necessarily result in a direct award to an in-house operator on any, or all, of the ferry services supported by the Scottish Government.

British Airways problems over the weekend of 27-28 May affected their entire route network from London Heathrow and London Gatwick. 6 routes between these two airports and Scotland were affected by cancellations or delays. During this period, connectivity between Scotland and London was maintained by 3 other airlines and one BA subsidiary. We are not aware of any assessment into its impact on BA customers or the wider economy. Under EU law passengers may be entitled to compensation where flights have been cancelled or delayed and further information is available on the Civil Aviation Authority website www.caa.co.uk

Under notice from the Office of Rail and Road (ORR) I have a statutory duty to produce a High Level Output Specification, and Statement of Funds Available, or likely to be made available by 20 July 2017.

This will be subject to timely confirmation from HM Treasury of both adequate funds and governance arrangements which do not compromise the Scottish Government’s discretion with current constitutional arrangements for rail.