Business Case – Establishment of a New Sustainable Aquaculture Innovation Function (SAIC)

1. Executive summary

Aquaculture is a significant contributor for Scotland’s economy, contributing £468 million in gross value added to the Scottish economy in 2023 and supporting 2,200 jobs^[1]. The latest Scottish Fish Farm Production Survey reported that in 2024 salmon farming achieved a production value of over £1.3 billion. Scottish Salmon is the UK’s most valuable food export and 2018 figures recognised that approximately 12,000 people were involved in Scottish aquaculture production and the associated supply chain.

The new Sustainable Aquaculture Innovation Cluster (SAIC) will play a critical role in supporting the sector’s resilience, productivity and climate readiness. SAIC will be an independent organisation covering the finfish, shellfish and seaweed offering within the aquaculture sector. SAIC’s main functions are to oversee and sponsor research and to connect academia, industry and government stakeholders to deliver research, technology development and knowledge exchange activities that directly address environmental pressures, productivity challenges and the impacts of climate change. Its independent position will enable SAIC to act on a sector wide basis, with this being the only independent aquaculture research body in Scotland.

The Sustainable Aquaculture Innovation Centre (SAIC (legacy project under University of Stirling (UoS))) previously received funding from the Scottish Funding Council (SFC), however, this funding ended in 2023, after which a reduced, interim settlement was provided by Scottish Government (SG) and SFC which ends on March 31st, 2026. SAIC (legacy project under UoS) has addressed key environmental and biological challenges and supported delivery of multiple Scottish Government strategies including the Blue Economy Vision and the Vision for Sustainable Aquaculture by generating evidence, de-risking innovation, supporting adoption of best practice, and facilitating collaboration across industry regulators and researchers.

Without sustained innovation support, Scotland risks declining competitiveness. Failure to support the Scottish aquaculture sector across key innovation challenges risks a failure to manage adverse biological impacts.

The purpose of this business case is to develop new arrangements that enable the long-term sustainment of aquaculture innovation support as has been delivered by SAIC; arrangements which help to maximise the productivity of Scotland’s marine resources. The Scottish Government has been working with the aquaculture sector, Crown Estate Scotland (CES), SAIC (legacy project under UoS) and other partners including Highlands and Islands Enterprise (HIE) and the University of Stirling to develop proposals for long term support for aquaculture innovation. This includes consideration of governance arrangements, funding and key deliverables.

The Business Case has been developed to ensure that the arrangement considers and assures the downstream grant payment, monitoring and assurance mechanisms for SAIC’s day to day operations. CES has prepared a parallel business case collaboratively with SG and SAIC that sets out alignment with policy priorities, clarity around deliverability and the establishment of appropriate governance and assurance.

The Preferred Option identified is to constitute a new independent legal entity (new SAIC) where CES will provide Scottish Government with £1.4 million per annum in revenue funding over five years with the intention that this funding be passed by a grant to SAIC. With the goal being to maximise funding available for the bid fund where there is flexibility, the expectation is that around half of the funding will be utilised to enable core operations with the other half for seed funding R&D projects. As highlighted in this Business Case, SG will be responsible for the operational role in the establishment or management of SAIC. A back-to-back grant agreement is in place, with CES providing funding to SG and SG issuing and managing the grant agreement with SAIC.

Establishing an independent organisation will enable Scotland to retain and grow its position as a centre of aquaculture innovation excellence. The new company will drive high quality, collaborative innovation that reduces environmental impacts, improves production efficiency, enhances climate resilience and strengthens Scotland’s global competitiveness. It will also provide a platform for deeper international collaboration and create opportunities to expand Scotland’s export of intellectual property, technologies and expertise.

1.1 Purpose

The purpose of this business case is to develop and implement arrangements for the long-term coordination and financial support of aquaculture innovation in Scotland following the anticipated end of current transitional arrangements for the Sustainable Aquaculture Innovation Centre (SAIC, legacy project under UoS).