Convention of the Highlands and Islands minutes: March 2022

Minutes from the meeting of the group on 21 March 2022.

Attendees and apologies

  • James Ayling, NHS Borders
  • Mike Cantlay, Scottish Funding Council
  • Elizabeth Corcoran, Skills Development Scotland
  • Jenni Craig, Scottish Borders Council
  • Michael Crawford, Rural Renaissance Ltd
  • Rob Dickson, VisitScotland
  • Archie Dryburgh, Dumfries and Galloway Council
  • John Evans, VCB
  • Alan Glasgow, Wheatley Homes South
  • Professor Russel Griggs, South of Scotland Enterprise
  • Scott Hamilton, Scottish Borders Council
  • Mark Hunter, Scottish Water
  • Euan Jardine, Scottish Borders Council
  • Mary McAllan, Scottish Government
  • Ray McCowan, Borders College
  • Mark McMullen, Scottish Enterprise
  • Jane Morrison-Ross , South of Scotland Enterprise
  • Elizabeth Passey, University of Glasgow
  • Bruce Pritchard, HWU
  • Shona Robison, Scottish Government
  • Mike Staples, South of Scotland Community Housing
  • Caroline Stuart, Dumfries and Galloway College
  • John Swinney, Scottish Government
  • Stephen Thompson, Dumfries and Galloway Council

Items and actions


  • 11:30 - 11:40 Welcome and Review of Previous Outcomes
  • 11:40 – 12:00 Introducing the work of the new Regional Economic Partnership
  • 12:00 – 12:15 Population
  • 12:15 – 12:55 Transport
  • 12:55 – 13:20 Lunch Break
  • 13:20 – 14:00 Labour Market and Skills
  • 14:00 – 14:30 National Strategy for Economic Transformation (NSET)
  • 14:30 – 14:40 Break
  • 14:40 – 14:55 Outcomes
  • 14:55 – 15:00 Forward Look & Close

Start of Transcript

John Swinney:        

...Convention of the Highlands and Islands in Spring 2022. On the opening slide, you'll see there's a hashtag for social media purposes. Very pleased to welcome everybody to this session which will be the last one before the local authority elections where obviously a number of our colleagues are involved in the local authority elections.

The agenda that we've got in front of us today will look - I'll say a little bit more in introduction and I'm going to invite in a moment our new Permanent Secretary in the Scottish Government, JP Marks, to say a few words just to introduce himself in a couple of moments. The first agenda item will look at the Regional Economic Partnership updates and then we'll look at population and transport before having a short break for lunch. Then we'll look at labour market and the economic strategy post lunch break. Obviously we're meeting virtually today. I do hope, by the time we come to the autumn, we are able to meet again in person and look forward to that being able to be undertaken.

That's the agenda for today. A number of my colleagues are going to be involved in the discussions. I'll obviously be here for the whole time. I'll steer things along and intervene. We're obviously looking to get to outcomes of the individual sessions so that we can pursue these subsequently. There is an update on the outcomes of previous sessions that's available in the papers, which demonstrates the areas where progress has been made.

With those comments from me, very warm welcome to everybody. Can I invite JP Marks, our Permanent Secretary who took office just at the start of the year, to say a few words to introduce himself? I know colleagues will be keen to engage with JP in the period going forward. Over to you, Permanent Secretary.

John-Paul Marks:

Thank you, Deputy First Minister. I hope colleagues can hear me okay. It's lovely to join you this morning.

Just a few comments from me upfront, firstly thank you for the opportunity to contribute to the convention and listen to the debate today. I grew up in an island community in a small fishing village in Rozel Bay in Jersey in the Channel Islands, so I spent my life living in an environment where debates about population growth, transport, farming, energy, fishing were always paramount. It's a privilege to be able to join the team in Scotland, learn a bit more about some of the immediate issues and concerns that we're thinking about right now with regards obviously our response to Ukraine, to COVID, thinking about energy, thinking about transport and, of course, economic transformation for the whole of Scotland and listening to the needs of our communities and making sure we're responding very well.

As Deputy First Minister said, I wish this could be face to face. I'm looking forward to visiting colleagues and meeting to understand communities much more deeply so that I can represent and help lead the team with your input and feedback. Thanks for the chance to join today. I look forward to listening and hope we can meet face to face again soon. Thank you.

John Swinney:        

Thanks very much, JP. I think in those comments a couple of really important observations. Firstly the distinctive dimension of the Highlands and Islands communities and the importance of us ensuring that we properly understand and reflect those in all of our priorities. Of course, this convention is a forum in which

we can exchange those views and ideas to ensure that we are doing that appropriately. Secondly the importance of understanding the experiences in individual communities. One of the joys of the programme [of visits] or venues for the convention around the Highlands and Islands is the opportunity to see those communities and to understand a bit more about some of those perspectives. It's very appropriate that our first agenda item is being led by Councillor Roddie Mackay, the leader of Comhairle nan Eilean Siar, which should have been the venue for this event had it been face to face. We'll just have to make do with looking at the screen of the Western Isles rather than its majesty today, which I'm sure it will be.

Thank you, JP, for those words. We obviously look forward to engaging with you in the course of our agenda today. Just as a piece of housekeeping, anyone that wishes to make a contribution, please just raise your hand in the bar and I'll keep an eye out for indications of interest to speak and we'll call people accordingly.

We'll move on to the first agenda item which is the update on Regional Economic

Partnerships. As I said, that will be led for us by Councillor Roddie Mackay, leader of Comhairle nan Eilean Siar. The Regional Economic Partnerships are crucial in all parts of the country, because they are founded on the importance of collaboration. But from the perspective of the Highlands and Islands, there's an added dimension which is the importance of ensuring that we draw together all of the different contributions and inputs that different organisations can make to ensure that we are successful in securing major opportunities and developments that will have an effect across the Highlands and Islands as well as in individual localities. Obviously, we've seen a number of examples of that in recent years. It's obviously a central part of our discussions that we've had as a convention about how we draw together our combined contributions to maximise the impact.

I'll invite Roddie to give an update on the Regional Economic Partnership and then we'll throw it open for discussion thereafter. Roddie?

Roddie Mackay:      

Okay. Thanks for that, John. As you know, we're a very able and forward-looking authority here. We had arranged for fantastic weather for you coming over. It's a beautiful day here, so maybe [you'll manage] over the next time we get an opportunity.

If I just give you an overview of where we're at with the Highlands and Islands

Regional Economic Partnership, we've had two meetings, one at the beginning of December and one in mid-February. At our inaugural meeting, what we did was we set out the purpose and the remit of the REP. There is a paper there outlining the remit in detail, but just if I could repeat your own comment that it's all about identifying opportunities for collaborative and coordinated action in pursuit of agreed priorities. We agreed that we would go forward in a collaborative way. We agreed that whilst there are regional priorities, there will also be individual priorities for individual areas. These would not get lost in the process.

At that initial meeting, we also agreed - at that meeting, and follow-up meeting - the membership of the REP. There's a whole host of parties involved there, parties that we're normally dealing with anyway in terms of local authority, Crown Estate, Scottish Funding Council, SDS, et cetera, et cetera. We've agreed that. We've also agreed that the REP Secretariat will be established. That function is going to be based in HIE's Lionacleit office in Benbecula. We're hopeful that that will provide successful support to the REP Secretariat. Also actually 50 per cent of the work will be on [repopulation] work, so right away that's a good collaborative outcome. At the first meeting, we focused on NSET. Actually at our next meeting, I guess NSET will be the focus for us.

At the second meeting which we held in mid-February, we focused on NPF4. There was a degree of disappointment from REP members around the unique attributes and potentials offered by the Highlands and Islands we felt were missing from the draft NPF4. Perhaps I'll ask Calum Iain to say a little bit about that after I've finished. Basically we're going to go back to government and write to the Minister to outline where we feel there are opportunities under NPF4 that have been at the minute, in the draft, missed and we feel that would add and enhance the quality of life in the Highlands and Islands.

We've also looked at renewable income opportunities, energy costs, et cetera.

But in summary the REP is at a very early stage of its development. We do want to ensure that we avoid duplication. We do want to ensure that it's not a talking shop. We are all committed to it. The initial meetings did augur well. There was good agreement around the key issues and joined-up approaches, particularly around things like NSET and NPF4. We'll work further on setting priorities. We'll build up a work plan. We'll get the Secretariat operational in action. Like CoHI there's been a senior officers' group been brought together to support the works of the REP.

Hopefully, going forward, the REP will become a standing item on the CoHI agenda. We think that would be a very positive outcome.

That's where we are at the minute. I don't know if Calum Iain MacIver wants to add a little bit of detail. Would that be all right at this juncture, John?

John Swinney:                                               

Yeah, that's grand, Roddie. Thank you. Calum Iain?

Calum Iain MacIver:          

All I would add, Leader, was just to note that the discussion around the National Strategy for Economic Transformation looked at opportunities. What are the key opportunities for the Highlands and Islands looking forward to 2030? I think that's where the disappointment with NPF4 comes through, because I think some of these real opportunities for the Highlands and Islands don't feature too highly in NPF4.

When we spoke about NSET, we looked at aspirations around renewable energy, in particular Scotland, the blue economy, life sciences, the space and aerospace sector, creative and heritage sector as well as the traditional sectors such as food and drink and tourism. Then taking that forward into NPF4, I think the general sentiment from REP members was that the draft NPF4 is a critical document that will set the tone and guide planning policy over the next period. The REP took the view that there are many good things in NPF4, but there are also serious omissions and inconsistencies, particularly around these opportunities.

In very summarised terms, there was a wee bit of a feeling that there was an inadvertent bias towards urban areas. The stated intent around sustaining rural areas and addressing population, members thought that was good, but it lacked detail on how that would be put into practice, particularly within the special strategy, the action areas and within the national developments. It was unclear about the thinking behind splitting Scotland into five action areas and again the critical role that the Highlands and Islands has in regard to net zero. There was a feeling that that ambition didn't really come through. That's a very summarised high-level view of some of the opportunities and some of the critique around NPF4. As Councillor Mackay said, we will be writing on behalf of the REP to the consultation, making these points and making these points a bit more fully.

I think, as Councillor Mackay said, the REP is new. We've had two very good meetings, which have focused on high-level national priorities and how we begin to collaborate around these issues. Further work is required around setting priorities, work plan, getting the Secretariat operational and developing the linkage with CoHI.

But I think it's a very good start but more work to be done over the next period. Happy to leave it at that, Leader.

Roddie Mackay:                 

Yeah. Thanks.

John Swinney:        

Okay. Thanks very much, Calum Iain. Obviously the points on NPF, I acknowledge those points. They can certainly feature into the consultation around NPF4. It's there for that purpose. But I think equally important is the feeding in of thinking from the Regional Economic Partnership to the convention at its meetings, because I think it's - one of the points I've been very keen to ensure that we focus on are some practical and tangible, sizable projects that we can corral around. It's been a feature of our dialogue with HIE over the years and I think it's important we reflect that in an ongoing basis in relation to the economic priorities of the Highlands. By that virtue, we'll have more success in creating greater economic opportunity if we operate in that fashion.

Okay, that's grand. Thanks. Any colleagues want to come in on the Regional Economic Partnership or any issues that are raised as a consequence? Yes, Alex Gallagher.

Alex Gallagher:       

Thanks, Deputy First Minister. No, it's just a comment. I think it's a good idea that the REP is a standing item on the agenda for CoHI. Just to make the observation that our islands are part of that as well, so we're actually - Cumbrae and Arran are actually part of two economic partnerships, so that's going to be an interesting development when we come to handle that. That's all.

John Swinney:        

Thanks, Alex. Any other comments? Yes, James Stockan. James? Then I'll come to Graham Leadbitter.

James Stockan:      

Thank you very much, Deputy First Minister. Yeah, just beyond that, I'm just conscious that our big, huge opportunity in the energy sector with ScotWind and INTOG and a number of these things are there. Also what's really interesting - and the question is how do we, as a region, get the support for our own infrastructure in ahead of that so that we can facilitate these things? The Crown Estate is handing over £700 million to the Scottish Government, but we're still working in an energy market which really is a [reserved] matter. How and where do we gather together to actually ensure that we get some early interventions so that these projects can go forward and not have an effect on the rest of our community? Because they are (a) nationally going to be huge contributors to the economy but also to the energy security that we need in the future. Is it the Crown Estate? Is it the Scottish Government? Is it the UK government? How do we corral everybody together to make sure we're not behind the curve?

John Swinney:                            

Thanks, James. Graham?

Graham Leadbitter:

Yeah. Thanks, John. The main point I was going to make, it's just following on from Alex's point that - and it feeds through to a lot of other documents that we're looking at today, a lot of other reports and some of the information reports as well. Certainly, our capacity, in terms of supporting a range of different organisations and different partnerships, is becoming fairly stretched. I think it's something that we need to take some cognizance of going forward just to make sure that we are able to continue to access all the opportunities that may be available.

Even for ourselves, we're looking at - we've got our own economic partnership. We've got the REP. We've got the CoHI work that goes on behind the scenes. We have the Just Transition Fund coming through. We've got our Growth Deal. We've got the Rural Tourism Infrastructure Fund and so on and so on. They're all fantastic. We're getting some really good opportunities for investment in our local economy from that and seeing some real benefits from that, but it does really squeeze our capacity as a smaller authority in terms of the officer time required and the ability to support that. Yeah, just as we go forward and these things expand out that we need to make sure that we're able to grab all of those opportunities.

John Swinney:        

Thanks, Graham. I saw Margaret Davidson's hand up. Margaret, you wanted to come in?

Margaret Davidson:

Sorry. Thank you, Deputy First Minister. Switching on and off things, I'm not too sure why we're all off camera or whether they think it's a reception issue, but never mind. Just to thank - first of all, to thank Roddie for his willingness to step up and chair the group and pull it all together and articulate the key issues that are coming out. As usual, when you get into a high-level partnership, it is actually surprising how much common ground you all have and where we're all pulling towards, so it's been really valuable to us. I've got no doubt about that. I'd also like to support James and his comments about corralling the organisations together here so that we get some input and some understanding.

My observations on the first phase of windfarms that we've had over the last 15, 20 years is that our community's got the crumbs on the table. We didn't get a fair crack of the whip. We didn't get the investment in infrastructure that they could have contributed to. Yes, locally perhaps if you could manage it but not the big strategic stuff. That's where I feel that the NPF4 has also let us down. It is about understanding the opportunities to improve our infrastructure and with all the wealth that's being created with us. Most of the wealth of the first batch of windfarms has gone south. We have got no doubt about that. We'd really like to be in a stronger position for the next round of development around renewable energy that is coming towards us at an incredible pace. The events in Ukraine have absolutely accelerated everything that's happening. Thank you, John.

John Swinney:        

Thanks, Margaret. Anyone else want to come in before I begin to draw things to a conclusion? [Pause] I don't see anyone else.

I'm going to ask just in a moment for Alistair Dodds or Stuart Black to come in from HIE's perspective in the light of what I'm about to say. But I think the critical point here for me and the focus that is necessary in the Regional Economic Partnership is about identifying how we - well, not identifying, facilitating the drawing together of all of the different contributions that can take place around a range of organisations to maximise economic opportunity in the Highlands and Islands. We've talked before, for some time, about how strategic projects can be developed within the Highlands and Islands, how they depend upon the contributions of a range of organisations and ultimately for that to be given economic impetus. Obviously, Highlands & Islands Enterprise is really pivotal to this work and play an active role in a whole series of strategic developments around the Highlands and Islands.

I might just invite Alistair Dodds or Stuart Black to reflect on how HIE can contribute towards realising the sentiment that we've just talked about in that session. Alistair?

Alistair Dodds:        

Yeah. Thanks, John. Good morning, everyone. I think it was really useful to hear some of the partners' views there, John. I think it's taken a bit of work to get where we are and I think Roddie probably hinted at that. I think one thing we haven't really spoken about is some of the wider membership. Perhaps that's also what you're hinting at there just now, around about the private sector involvement which is a different element than we have at CoHI. We've got community involvement as well. I think it's getting that rounded view and, I think as you were speaking about, the wider view of the opportunities across the Highlands and Islands so in reference from James and Margaret to energy. I think where the REP can really add value is around about a topic like that where you've got opportunity in Shetland. You've got great opportunity in Orkney. You've got opportunity in the Outer Hebrides.

Pretty much every single local authority area can benefit from the real, I think, positive opportunities that are around at the moment and are likely to develop over the next five to 10 years. Working together with local authorities, with Crown Estate, with the private sector and communities, I think we can make a real difference. The challenge is to do real things. I think there was reference to that. If it's just another talking shop, then we shouldn't be there. But I'm confident that we have significant opportunities to make real benefits for the whole of the Highlands and Islands over the next 10 years and really talking about from now onwards, so it's not about three or four years' time. It's really about working together just now. I'm pretty confident of what's there. I think HIE, working with the other partners, can make a real difference and to the lives of people.

The one thing which I would probably add to that is that about - we really need to ensure that Scottish Government strategies are joined up. There's reference to various things today around about population, around about transport and so on. These are all really significant for us. I think we need to make sure that the REP can bring forward a partnership and collaborative approach across the Highlands and Islands, but there's also a challenge for the Scottish Government. I think that's where I would finish just now. I'm not sure if that's what you wanted me to pick up, but that's my ramblings for the moment.

John Swinney:        

That's helpful, Alistair. Thank you. I think that between what Alistair has said and what I've said in a sense responds to James Stockan's point that we need to gather our energies together. I view that as being essentially a collaborative endeavour involving the convention, HIE. The Scottish Government's obviously immersed in this. Permanent Secretary, one of the issues that we've been discussing is the importance of ensuring the coherent approach towards the consenting approach in relation to Scotland and the approach to that being compatible with the development of a domestic economic strategy to maximise the beneficial economic impact of that. That will inevitably involve the Scottish Government being very much at the centre of that and ensuring that we can enable that to be achieved so that we get that economic benefit. But I see Stuart Black wants to come in as well, so Stuart, hear from you.

Stuart Black:

Yes. Thanks, Deputy First Minister. Just wanted to add a bit to what Alistair was saying around the degree to which we have economic opportunities in the region. I think particularly the ScotWind proposals, which Margaret was also referring to, do offer significant opportunities right across the whole of the Highlands and Islands. I think the other context which is important here is the new National Economic Strategy for Transformation. I think we need to see how Highlands and Islands can contribute to that transformation strategy, so I think the REP has an important role to play in that as well. I think it was good to hear from colleagues around the region what the challenges and opportunities are, but I do think Scotland is really a huge one. That's why it's a bit disappointinfg it isn't referred to sufficiently in NPF4. There's opportunities right across our region to benefit from that and create significant employment. Thanks.

John Swinney:        

Thanks, Stuart. Yeah, we'll take those sentiments away. We'll feed those back to our colleagues dealing with National Planning Framework. We'll also ensure that we are actively promoting the necessary economic collaboration to make the most of these opportunities. HIE will be central to drawing a lot of that together, working with the Regional Economic Partnership. Okay. Roddie, do you want to add anything to close that item?

Roddie Mackay:      

Okay. Sorry, no. No, it's good to get that element of feedback from around the table. I think that last point maybe that Stuart raised about having more emphasis on the ScotWind potential is something that we're obviously going to build on anyway. I'd hope government will be central to that.

Just a follow-up on what Alistair was saying also. If we're all going to come together as disparate groups and we're going to take in the private sector and local authorities, we - to have some national economic strategy where we grow Scotland. Now part of that is definitely the Scottish Government's own role as well. We can see businesses here getting very busy. We can see - whether it's tourism, construction, whatever. Then we've got - if the transport - and we've come on to that, but if the transport isn't working, if it's not joined up, then all the others fall down as well. It's just joined-up thinking and I think we're going to do a lot more of that in the REP. It's very encouraging so far, so thanks for that.

John Swinney:        

Okay. Thanks, Roddie. That's grand. We'll chart those points to follow up in the outcomes later on today.

We'll move on then to our next topic of discussion, which is a short update on the population work that's been discussed before in the convention but which is going to be the subject of update from - led by my colleague, the Rural Affairs Secretary, Mairi Gougeon. Mairi, over to you.

Mairi Gougeon:       

Thanks, Deputy First Minister. It's a key commitment from Scottish Government that we have a population that's more balanced and distributed across Scotland so that essentially all of our communities can flourish. But we know that to try and address population decline and to try and get that healthy balanced population profile, we know that we have to work closely with our regional, local and community partners too. I know that that's been a message that's been endorsed at previous conventions. That's really provided the clarity and steer for the working group and Scottish Government officials to drive forward with the agreed multitrack approach to tackling our population challenges.

I'm really looking forward to hearing more about the progress that's being made by the work group since the last CoHI. Government have also been making progress in a number of areas that should deliver some positive impacts. As an example of that, we've progressed with the agreed outcome from the previous CoHI, which stated that Scottish Government will commission its Expert Advisory Group on Population and Migration to lead a review of existing zonal methodologies to inform the development of the proposed repopulation zone concept.

I'm keen that we allow as much time as we can for discussion on the agenda item today, so I'll just hand over to our speakers. First of all, we'll hear from Morven Cameron from HIE, who's going to provide an update on the work of the population group, and Ben Jones from the Scottish Government's population team who's also going to give an update on the progress towards reviewing the zonal methodologies. I'll hand over to you, Morven.

Morven Cameron:

Thank you very much, Ms Gougeon. I'm just going to give a very brief canter through a small number of slides to provide an update for everybody. If you want to move on to the next slide please - population has been a constant topic at CoHI for many years and has really become, I think, more serious in our conversations over the last couple of years. This is at a time where the opportunity for Highlands and Islands in terms of jobs and economic growth for the next decade is looking absolutely amazing from our point of view, so the idea that we have this difficulty with accessing enough people in the region is a double challenge. That shows itself really in terms of the opportunities that are existing around about offshore wind.

We've touched on already green hydrogen space, the Growth Deal projects - that's for the future - but also what we know now about the jobs, particularly in places like Moray where we've got organisations like Walker's and Johnstons who are trying to recruit large numbers of people and struggling to be able to access enough people. We have a mixed picture across the whole of the Highlands and Islands, which has been discussed over many years. But the work of the CoHI population group has been focused on the areas that have been depopulating in particular. I noted that we welcomed the Scottish population strategy being launched last year and particularly that focus on balance which Ms Gougeon just referred to.

We created the working group. We've developed a strong working partnership across organisations. We're pushing boundaries within our own organisations and the opportunities that we can deliver directly, but we're also collaborating where we possibly can. We're trying new ways of making a difference in some of these places. Importantly we're ensuring that there's really good close engagement with the Scottish Government. Next slide, please.

If we look at the joined-up approach that we're taking, we're certainly bringing depopulation issues to the fore. There's quite a lot of different conversations and topics and press releases that are picking on these matters. We're targeting our four local authorities that are involved in the working group.

As we updated at the last meeting, the five key areas of focus are housing, jobs - both creating new and dispersing existing and future - critical infrastructure, access to services - both public and private, those services that are required to keep communities alive and growing - and broadly talent attraction, retention and return. These remain the five areas of focus that the working group is looking at. Some aspects of these are more easy to address and others less so. For instance, just to mention in housing, we are seeing an increasing number of developments, both community-led and indeed employer-led projects starting to come to the fore. But really the scale of the need in the housing side of things is really, really significant. I'll come back to that quickly. Then alongside that, as Ms Gougeon referred, the Scottish Government is looking at developing methodology for a formalised repopulation zone framework which we hope to see. Next slide, please.

Just by way of reminder to colleagues around the CoHI table, these are the nine pilot areas that our population working group has decided that we want to focus a particular effort on, not solely but a particular effort. Collectively that covers about 37,000 of a population in these nine areas which includes six island groupings. We're working to direct some specific initiatives in these places but also in the places round about these areas. The next slide, please.

Just as a way of giving you an update on some of the activities, here's some examples. We are collectively funding three settlement officer posts that will be starting over the next month or six weeks. They will be helping with people who are already living in these areas but also to support people that are moving into some of these areas, just in terms of signposting but importantly also in terms of being on the ground, gathering real data, live data about the issues that are being faced so that we can even more tailor our responses. Along with SDS and South of Scotland Enterprise, we have agreed funding for the SCMA for 70 rural childminders.

We will be targeting some of these particular areas that we're struggling in. Through our work with community and the broadband, we are looking at feasibility studies for four areas - Assynt, Achiltibuie, Coll and South Uist - to do a technical detailed analysis of what actually would be required to bring these areas up to the best possible broadband access with a view that we then allow some case studies where we can actually make these differences and measure the impact in these particular locations.

We've been prioritising graduate placements into more rural areas. Graduate placements are something that HIE and others have always supported. They're a very direct and targeted approach to getting young talent located into businesses that are growing in these places.

There are discussions underway about whether we could and should enhance some business start-up support where necessary and appropriate. There's some really good work being done by local authorities supported by HIE in many areas, but we believe we could perhaps do some more and make it easier for businesses and young people in particular to start businesses. We're in discussion with the islands team at the moment about a community-led skills fund which will support the skilling up, the bottom-up skill requirements that some of these communities are needing as an essential part of their long-term existence.

We're advancing job dispersal across organisations. HIE itself is already making sure that we, where we possibly can, are able to locate people in all parts of the Highlands and Islands. Indeed three of our directors at the senior level are also located in all parts of Highlands. We've got Shetland, Dunoon and in Caithness. Really we're encouraging all of the organisations in the working group, all of those organisations that we can reach out to, and the Scottish Government, to put some more effort into that job dispersal.

We're also looking - and I'll come on to the next slide which actually takes us into looking at a slightly more localised approach. What we're finding is that actually we know place based in the right approach. Actually sometimes that gets very local.

Whilst we're doing the west coast islands and islands areas where we're identifying issues and gathering data, we're doing a range of interventions and targeting products and services. Through our colleagues in the [unclear], we're also looking at a [unclear] population zone action plan which is bringing together planned capital investments, housing developments and other talent attraction initiative to create the conditions for growth and then more specifically looking at, for instance,

Lochboisdale where we're looking at a targeted plan to be addressing some of the very specific issues and opportunities it has down there. I think really what we're trying to do is the broad coverage of the area but also look at getting down to the very local in terms of responding to their needs as a view of providing a test and demonstration set of initiatives to support the repopulation zone methodology.

Next slide, I think, just quickly. Not to lose heart. There are exemplary models. We've got some really good examples of where place-based community-led approaches have worked. In the Isle of Eigg, we've seen an 83 per cent increase in population over the last 25 years. In Gigha which has just experienced its 20th anniversary, they've seen an 80 per cent increase in population there. In Knoydart, 73 per cent increase in population. The West Harris Trust, 49 per cent. We know it can work and we're seeing evidence of where that's happening.

I've mentioned the graduate placement programme. We've already mentioned that the new REP Secretariat will be located in Benbecula, so again HIE establishing that data centre there was a really good opportunity and a test case of how it can work in terms of locating jobs in more dispersed and rural parts of the Highlands and Islands. We would commend that. I think we're also about to face the 20th anniversary of that particular development. We're seeing a growing number of community housing initiatives supported by Communities Housing Trust, by HIE, local authorities and increasingly by businesses themselves. We're seeing this built-in organisational approach to the dispersal of jobs. But we just need to see more of everything.

I think my final slide before I hand over to Ben and the government colleagues is to simply say that in terms of looking ahead there'll be a continued focus on a mix of very local place-based and broader cross local authority interventions. Whilst we're focusing on the four local authorities that we're working with, we are also reaching out and talking to our colleagues in Orkney, Shetland and Moray and other places to make sure we're sharing information and updates with them. We want to continue to see the join up that's required across Scottish Government teams and ourselves. That's really important and we're getting really good traction on that. We're inputting to rural visa pilots, talent attraction programmes, et cetera.

However, final comment really is that the primary issues remain housing, transport, connectivity and increasingly energy and grid connectivity. We could do all the things we're talking about now. We could do them in even greater numbers. But these remain the really wicked challenges that we're facing in these areas of depopulation. We're looking to see more joined-up investment, resources and policy adaptation to tackle these. I'll hand over to Ben. Thank you.

Ben Jones:

Thanks, Morven. Good afternoon, everyone. Conscious of time. I'll just provide a brief update if we could move to the next slide, please, highlighting some select work on population from the SG side. Then I'll pass back to the Cabinet Secretary.

As has been alluded to before, just on the progressing the investigation of the repopulation zone concept, our independent Expert Advisory Group on Migration and Population, which is formed of academic experts across Scotland, met earlier this month to deliberate over what the shape of the analysis they would be undertaking would be. Over the next month or so, they'll be refining that and teasing out some of the key research questions which will feed into that work. We're expecting that that analysis will begin in late April this year with a view to publishing in the autumn, so we'll look forward to that.

Just other select work by way of an update that we thought would be useful to highlight to the convention is the ongoing progress around rural visa pilot proposals. Our working group of local authorities and business partners will meet for the first time this week with a view to submitting proposals to the UK government in summer this year. Islands Bond work, as is on the slide there, continues as well. The ongoing shared focus of the ministerial Population Taskforce continues as well with the next meeting being on 9 May. With that, I will just pass back to the Cabinet Secretary. Thank you.

Mairi Gougeon:       

Thanks very much for that, Ben, and to Morven as well. Open that up if anybody has any comments they would like at this point. Margaret, do you want to come in?

Margaret Davidson:

I do. Thank you. Hello, Mairi. Thank you. Okay, it was good to hear that, because there was quite a lot in there that I wasn't aware of that was moving along fairly fast. But my key point here is it's not fast enough. I say this advisedly, because we have people coming through the door week by week saying, right, okay, these are our plans around the coast of Highland and these are what we're going to need. If they're hearing that they've got declining populations and they haven't got the pipeline of people that they can rely on, they're not going to make those investments. That's why I really think that this is of the utmost importance.

Right at the absolute centre of it is connectivity and broadband. That was brought out [unclear] the wicked issues. I think we've just got to be brave in what we're doing here. I see that we're doing some more feasibility work. Well, hurray. I think we've just got to be brave here. We've got to start saying, right, what will work here? Wireless, maybe 5G. I don't know. We've got people who do know. We need to be saying, R100 is never going to get here. UK government's gigabit ideas are going to take too long and we'll all be that much older. I actually feel that we have an urgency here that is actually really where we need to be.

Things are moving along faster and more comprehensively than I thought. I'm pleased about that. But therefore I would say to officers, can you review your governance so that we actually understand what's going on, and communication so that everyone's on the same page and is putting out the same messages? Because there has never been the opportunities that we have in front of us at the moment for investment and driving our economy forward. Yet some of the places that could benefit most are needing this massive drive on repopulation. Please don't marginalise Caithness. If the government and this project can't cope with it, then discuss it with Highland Council and we'll get something in place ourselves. Caithness has the scariest depopulation and it has the most opportunities at the moment. There really does need to be a key focus on this.

With digital it's about being brave and taking the jump. We've got the money. We've got the investment. It is about getting beyond the feasibility studies and actually getting on with the action. We will never, ever retain our young people unless we've got good broadband connectivity. I'm absolutely crystal clear on that. We not only need to retain them. Again we'll come back to this with employability later on. We need to be keeping them and keeping their families and attracting more people in.

To me good work, fine, absolutely great. We need to accelerate this in places, because it is absolutely key. We will otherwise seriously miss many of the opportunities that are out there.

Mairi Gougeon:                                                    

Thanks, Margaret. Mary, you were wanting to come in next?

Mary MacInnes:      

Thank you, Cabinet Secretary. Thank you, Deputy First Minister, as well. To some extent, Margaret stole my thunder. She got in first with exactly one of the points I was going to make. I was going to ask about timing. Timing is absolutely critical here. I don't need to say what Margaret [unclear] - you've heard from her. Yes, everything needs to be timed and things need to happen.

I'm very pleased and delighted to look at all these things around Uist. Really need it there. Also seeing that it's building on investment already done by the government, which is in terms of the pier at Lochboisdale, the marina and also the work of [unclear] and all that. There's infrastructure in the community, so it makes real sense building on that. I'm delighted to see that there are plans ahead for that.

I think there's a lot of interesting and useful things [there]. Of course, the Islands Bond is going to go ahead. That's going to be a good thing. But I would again urge that Gaelic has its place there, the Gaelic. We, as many others at the board, have responded to the consultation. We wait with interest to see how that will look when it comes out soon, but it's critical that Gaelic has a core role in the Island Bond and bringing people to the island. The one that's equally - because we don't have the people that we need to get them there. But without a ferry, they will not get there. I cannot understate the importance of the ferry issues and transport to the islands, particularly to Uist. It is very, very, very serious.

I'm just following on what Margaret has said and urging that Gaelic and transport are there and also the fact that I've heard you're encouraging government bodies to have their own people working in the islands. We, as a board, have actually done quite a lot on that. Twenty per cent of our people are now actually living in Lewis and working across the country. That has happened as really a by-product of the situation we're in. It's good and we'd want to increase that. We would welcome other bodies doing the same. That's all I have to say. Thank you very much.

Mairi Gougeon:       

Thanks very much, Mary. I know we'll have the transport item next where I know some of those issues will probably be picked up. Alex, were you wanting to come in as well?

Alex Gallagher:       

Yes. Thanks, Minister. I would just go what Mary's just said. She's stolen my thunder, because I - we certainly support some of this. We support the dispersal of jobs. We would be 100 per cent behind that. It'd be nice to see a little government office in Millport or somewhere. That would be very nice to have. Yeah, I think that there's some good stuff. I think the points that were made about speed, well, that's obviously key to some people's view of it.

What I would say is I - the two things. I was on Arran two weeks ago, launching what we are - North Ayrshire in cooperation with HIE and the Scottish Government have produced a 10-year plan, two 10-year plans, one for each of our islands. I was on Arran last week, launching them. I got stuck on the island for three days. We couldn't get off. The ferry wouldn't sail. On the third day when the ferry would sail, they developed a mechanical fault which wasn't crippling but we still managed - we were still delayed. We had to get off after a three-day delay. The big thing that the islanders raised with us - and we had this plan as I said, but housing and the ferries are the two big issues. Housing's a double bind. If you don't get housing, the workers leave. Then these become second homes and you still don't have housing. It's a real issue.

What I would say is that we did issue these 10-year plans last week on Arran and this week on Comrie. They're in cooperation with the Scottish Government and Highlands and Islands. Your islands team were on Arran that day by the way, Minister, so they can give you a first-hand account. Nicola and a young man. I forget his name. Basically I would say we've issued these and it might be worth somebody taking a look at them, because it's not just a glossy brochure. It's accompanied by an action plan. The aim will be that we will have a working group to drive this forward. The working group will be chaired by someone who lives on the islands and not by the council. We'll facilitate. It might be worthwhile anyone picking up a copy of that and having a look at it.

But reiterate, two big issues, the ferry and housing. I would also say I've learned quite recently that the R100, while it will go onto many islands, it won't go to every business. It won't go to every dwelling. I think that's going to be a drawback on the west side of Arran, for instance. That would be my contribution. Thanks.

Mairi Gougeon:       

Thanks very much for that. Sorry, I'm conscious we're running over time now, but I have James and Alistair looking to come in after that.

James Stockan:      

Thank you very much, Cabinet Secretary. I'll try and be brief. Just [appalling on] - I mean, housing is the big issue as far as I can see in this context. I had hoped that when we had got connectivity and we had the possibility of remote working, it was going to be a real uplift for some of these areas.

I'm just wanting to put something on the radar at the moment. That is the fact that when you don't have housing, that can work the other way. People don't come, but they actually provide the service from not on the islands. I've seen that in the health board recently here in Orkney where we've had increased population. We can't get people in the houses and then people are starting to say, well, this job can be done from elsewhere by a virtual approach taken [unclear]. We need to be really careful learning [our] experiences and sharing them across the [unclear]. I'm really quite conscious that we must have very good connectivity from our broadband, but at the same time, we must make sure that government organisations don't station people in places that are only serving us from a distance. We need to bear that in mind going forward. Thank you.

Mairi Gougeon:                         

Thanks, James. Alistair?

Alistair Dodds:        

Yeah, I'll be brief as well. Thanks, Cabinet Secretary. I think these last few comments, I think they've all stole my thunder. But it's about joining up strategies, both across government but across the working group as well. Does our broadband align with population? Do our housing strategies align with population? Do our transport strategies? Because when I talk to businesses, talk to communities - and I've spoken to over 160 in the last 12 months - these are the three things that come up that make a difference to a successful community going forward.

The second point I'd make is slightly more direct. We've spoken about job dispersal. We've spoken probably about it at the last two meetings. We don't see any real progress. Could I just put a challenge out here? Wouldn't it be great for the next CoHI, either in six months or the one in 12 months, what have the organisations on this call actually done? What are the specifics that we've made an improvement on, the number of jobs that have gone to Uist or Shetland or wherever else, from the Scottish Government and from the agencies on this call? Let's see some real action as opposed to just carrying the discussion on meeting after meeting. Thanks very much.

Mairi Gougeon:                                                                         

Thanks, Alistair. Alastair Cooper, you were wanting to come in.

Alastair Cooper:      

Yeah. What I was going to say has been said by so many before, but just to kind of add to it, in Shetland's case we have problems of depopulation from our internal islands. That's Yell, Unst, Fetlar, Skerries and such like. But we also struggle to recruit into the island. The point that James was making is very pertinent in that we now have a lot of folk providing services within Shetland, but their wages is delivered outwith Shetland. We don't get the real benefit. We don't get the family or any further benefits in the schools. But we have an ambitious housing programme which should deliver about 400 houses in the next 10 years. We're hoping that'll help the issue, but the cost of external transport is still a deterrent for folk coming to live in Shetland. They find going home to see their family, the cost of airfares, the cost of ferry fares is still an impediment. That's what we're going to struggle with all the time.

Mairi Gougeon:                                                     

Thanks, Alastair. Carolyn and then I'll draw things to a close.

Carolyn Caddick:

Thank you. Thank you very much. I know it says Councillor against my name, but I'm actually here as the Deputy Convener of the National Park. I just wanted to bring a flavour, because it's not the islands so much. But we have exactly the same problems, lack of housing and also the joined-up transport. I think a transport strategy - there's lots of transport. But it doesn't all seem to join up, so that people arrive and then there's nowhere to take them on from there. In rural locations, you really need to have that joined-up strategy all the time. I think the point made about the broadband are 100 - again there's a lot of people choosing to work - it's not so much government agencies, but private businesses are choosing people to work at home now, much more than they ever were before, post-COVID. If there's broadband available, people will come. They will work and they will stay. It's not second-housing people. It's people that actually want to live and work from the park. I think that's probably worth saying, so the broadband is key to that.

Finally I would agree with Alastair. Actually there are things going on. There was a fantastic housing conference in Aviemore towards the end of last year. The Finance Secretary was there. It was really helpful, because it debunked a few myths and actually talked about how the solutions could be put. As a result of that, there are some initiatives on its way, so it would be great if we could bring back some of those good things that are going on as well of the things that we'd like to see going on. Thank you.

Mairi Gougeon:       

Thanks very much for that. Just to say, I mean, I know that this isn't just about - there isn't one solution to this and it's not an easy challenge to try and solve. It does mean addressing all these issues across the board, whether that's transport, broader connectivity as well as housing as well. There's the Remote, Rural and Island Housing Action Plan which is - I think there's currently engagement that's ongoing in the development of that too, which will feed into this and hopefully help address some of the other challenges. But again I don't underestimate the scale of the challenges here or the amount of work that's still going to be required. But I really just want to thank everyone for the work in progress that's been made by CoHI members in exploring and trying to address some of the challenges we've talked about today. I think it's really vital that we maintain that momentum and that we see some meaningful progress by the time that we meet at the next CoHI, so I would also accept Alastair's challenge as part of that too.

I also just wanted to take the opportunity to announce to the convention today that Scottish Government intends to progress with our commitment to developing an action plan to address the challenge of depopulation. That's going to include a focus on supporting the repopulation of our rural and island communities as we've set out in our National Islands Plan too. I know members will be all too aware this is a really complex subject. I think all the work that's been undertaken by CoHI members so far certainly puts us in a good position. Developing and delivering a meaningful action plan can't be done overnight, but we would expect the work to continue through this year with a view to having a published draft by winter next year. No doubt that CoHI and its members will be key stakeholders in the development of that too. Thanks very much for your discussion on that today.

John Swinney:        

Thanks very much, Mairi. Obviously, some of the key issues coming out of that discussion will flow into a discussion we're just about to have on transport, so what we'll do is we'll make sure some of the points raised there are woven into the outcomes that we settle on in the course of today. We'll move on with the next discussion on transport. Jenny Gilruth, the Transport Minister, is with us to lead this discussion. Over to you, Jenny, and then we'll take contributions from colleagues. Jenny?

Jenny Gilruth:         

Thank you. Thank you, DFM. I welcome this opportunity to chair the transport discussion as part of my first CoHI meeting. I know just how vital transport and connectivity are to the Highlands and Islands. Indeed, of course, we've already heard this morning about the need to better join up our transport infrastructure, particularly about some of the challenges on our ferries network which I'm sure we'll come to in the discussion after. I did meet with Highlands and Islands [CDI] in Inverness just last month and I really enjoyed that discussion. The overall importance attached to sustainable transport which actually delivers for the people and businesses of your region was made very clear to me.

Immediately before I was appointed as Transport Minister, two key pieces of work, which nationally are seeking to change the relationship we have with our cars and driving but also change the direction of transport investment in Scotland, were published for public consultation. Those were the route map to 20 per cent car kilometre reduction and the second Strategic Transport Projects Review. I want to thank CoHI partners and their contribution to this work thus far. I would encourage you all to respond to those consultations, which close next month.

The transport paper for today also gives an update on other government-led pieces of work, which includes the Fair Fares Review, Transport Governance and Collaboration Review, the Islands Connectivity Plan, Aviation Strategy and also ongoing trunk road schemes. The paper also notes the work of their regional transport strategies. That's being progressed by the three Regional Transport Partnerships in collaboration with their constituent CoHI local authorities.

I'm now going to hand over to Nicola Blaney from Transport Scotland and to Ranald Robertson of HITRANS who are going to give further information on the paper. Nicola will speak on the strategic transport context, including STPR2 and its recommendations. Ranald will present on the regional transport context. Both will then give further insight with regards to the Islands Connectivity Plan, including ferry and aviation investment. Thank you.

Ranald Robertson:

Thank you very much, Minister. I'm Ranald Robertson, Partnership Director with HITRANS.

I think the population item has done a great job of capturing the important enabling role that transport has for the wider economy and indeed, when it doesn't go well, the disabling role that it can have. For this reason, transport is one of the CoHI key workstreams. That strand specifically seeks to enable businesses to grow and thrive by ensuring that every community can access and be accessed from Scotland's main urban centres for a meaningful business day within two to three hours by affordable transportation, that there will be appropriate and common standards of affordable access to and around the nearest local centre with [generally] minimum of three return passenger transport journeys at affordable price points. Goods should be able to travel into, from and within the region with minimal delay, acceptable frequency and with good reliability and at a reasonable and consistent cost across the region.

Through our earlier engagement through CoHI with Transport Scotland, these key strands have been developed into the National Transport Strategy. We are making some real progress on developing how we might implement these types of solutions. The delivery plans will be around the Infrastructure Investment Plan, Strategic Transport Projects Review and the Islands Connectivity Plan and those regional documents like the regional transport strategies and local transport plans as well. There will be ongoing work to improve the structure around transport governance to improve local outcomes and how transport services and infrastructure are delivered.

The paper today outlines the strategic context of this work and the progress being made in these key areas. The paper also recognises that transport availability, resilience and reliability are having an impact on communities across the Highlands and Islands today. The paper presents updates on ferry service investment, trunk road improvements and touches on the need to ensure rural areas receive adequate funding to give residents and visitors a public transport alternative to the private car.

I'll hand over to Nicola Blaney from Transport Scotland now who will present on the strategic context and nearly everything else. I will chip in the regional context. Apologies in advance that any errors in choreography are bound to be down to my two left feet. Over to you, Nicola. The next slide, please.

Nicola Blaney:        

Ranald, thank you very much to that. Thank you to the convention this afternoon for the opportunity to hopefully give you a pretty comprehensive overview of where we are on the transport theme, particularly given that you've not had a pretty detailed update the last few meetings of this convention. Thank you again.

Just over two years ago, the Scottish Government published the second National Transport Strategy which sets the vision of a sustainable, inclusive, safe and accessible transport system that aids in the delivery of a healthier, fairer and more prosperous Scotland. This decision is underpinned by four priorities. That is to reduce inequalities, take climate action, help deliver inclusive economic growth and to improve the health and wellbeing. The first annual delivery plan was published in December 2020. The second delivery plan will be published in the coming months following the local elections. Alongside the second delivery plan, there will also be a monitoring and evaluation report as well. The successful delivery of NTS2 and its visions remains a collaborative endeavour with representation on the NTS2 delivery board from each of the Regional Transport Partnerships across Scotland including, of course, [SETRANS], HITRANS and SPT represented at CoHI here today.

The Climate Change Plan, which was updated also in 2020, included a commitment to reduce car kilometres by 20 per cent by 2030. To this end, the Scottish Government published a route map for providing a framework of measures on 13 January this year. With the largest share of transport emissions coming from cars, the predominance of car use, particularly for single-occupancy trips, cannot be overlooked. Therefore this publication marks a move towards meaningful engagement with the people across Scotland to understand the role that they can play as individuals and how that can translate into wider benefits in a health and wellbeing perspective for themselves, their families and indeed their communities. Therefore I thank the convention members who I'm sure will already be considering providing feedback on the route map and its statutory impact assessments through the consultation which, as the Minister mentioned, is currently open and will remain open until 6 April.

As part of a broader package of work being undertaken by Transport Scotland, the Fair Fares Review will look at a range of discounts and concessionary schemes which are available on all modes including bus, rail and ferries. It will take cognizance of the cost of and availability of services. It will also consider options against a background where the costs of car travel are declining and the public transport costs are increasing.

As part of the work to develop NTS2, a transport governance review was initiated. That work highlighted a number of complexities in that area. It also noted that further work was required in order to develop feasible proposals for implementation. Therefore we are now engaging with the Regional Transport Partnerships as well as working collaboratively with COSLA, [SOLIS], specifically looking to develop implementable models. This is also within the context of the local governance review.

I'm going to take you through now, in a next couple of slides, the progress made on the STPR2, so if I could just ask us to move on to the next slide, please. The second Strategic Transport Projects Review will inform the Scottish Government's transport investment programme for the next 20 years. It will help deliver the vision of the National Transport Strategy. The review sets out 45 draft recommendations. These were published for consultation on 20 January this year along with as well the statutory impact assessments. This consultation will also close next month on 15 April. Again thank you very much in advance for everyone's consideration and feedback through that process.

These recommendations are firmly founded on the sustainable investment hierarchy. I focus now very much firmly on how transport can help us protect our climate. The review presents the strategic business case for the recommendations. After this consultation stage, the next stage will be to further develop the recommendations considering, of course, the feedback from the consultation. That will then feed into the final report which is due to be published later this year, towards the autumn of this year.

I'd like to now take you through some of the recommendations that are more specific to the Highlands and Islands. Next slide, please. These are the Highland Main Line rail enhancements, the fixed links to the Outer Hebrides and Mull, access to Argyll, ferry vessel renewal and, of course, how that can contribute to the progressive decarbonisation of our transport system and as well the supporting integrated journeys at ferry terminals. STPR2 recommends a programme of enhancements which would achieve improvements to journey times and increased capacity and reliability for the passengers and freight services on the Highland Main Line. The additional freight enhancements, due to the increases in volumes that would be carried, would also be considered where these would lower the operational costs and encourage a faster shift from road to rail. These improvements would also integrate rail delivery across passenger and freight services.

STPR2 also recommends that further work is undertaken on the business cases on the potential Sound of Harris, Sound of Barra fixed links as well as the fixed links between Mull and the Scottish mainland. These business cases would aim to better understand the benefits, the costs and the challenges associated with these options. These studies would consider the feasibility of replacing existing ferry services currently delivered by CalMac as part of the Clyde and Hebrides Ferry Services or the CHFS contracts. These studies would also ascertain the potential savings associated with the public sector subsidies required to operate ferry services and involve input from communities that may potentially be affected. Replacing ferry services with fixed links can, of course, improve reliability, connectivity, capacity and travel times for many island communities and the benefits of which will be drawn out in that further business case work.

With regards to access to Argyll, that recommendation is for continuing on developing a more reliable route with new or improved roads infrastructure to address, of course, the ongoing closures on the A83. This would improve the reliability of the route as a vital arterial route through Argyll as well as a connection to both Kintyre and Cowal peninsulas as well. The STPR2 recommendation is that work continues on developing a more reliable route. A preferred corridor has, of course, been identified at the Glen Croe. Those five possible route options are being considered with speed of delivery as a key criteria for that assessment.

The ferry vessel renewal and replacement programme and, of course, the decarbonisation of ferry services is also a key recommendation for the Highlands and Islands. STPR2 recommends that the renewal and replacement of the CHFS and NIFS vessels, including progressive decarbonisation, are carried forward and considered further. Of course, that decarbonisation, I should have said as well, is by 2045.

Finally the other STPR2 recommendation that I believe is of most or one of the ones that are [most] specific to the Highlands and Islands is that supporting of integrated journeys at ferry terminals. STPR2 recommends that detailed review of the key ferry terminals is undertaken to consider improvements in timetable information, signalling and the ticketing and facilities required for a seamless journey. That's between the different types of public transport to enhance the traveller experience and accessibilities at these key terminals. Next slide, please.

In addition to those specific recommendations as well as the other - yeah?

John Swinney:        

Nicola, it's John Swinney here. Can I ask you to - I need you to up the pace a wee bit, please, because we need to...

Nicola Blaney:

Of course

John Swinney: up for discussion. If you could start...

Nicola Blaney:        

Of course.

John Swinney:        

...drawing things to a close - thanks.

Nicola Blaney:        

No problem. Thank you very much. The benefits to the

Highlands and Islands will contribute to the national reduction in CO2 as well as reduction in vehicle car kilometres. Of course, the net zero aims will also be supported by the decarbonisation of the public transport network. Next slide, please.

I will pass back to Ranald. Thank you.

Ranald Robertson:

Yes, and we can skip the next slide again as well, please. In the interests of brevity, I will try and reduce what I was planning on saying. Yes, there are three Regional Transport Partnerships covering the CoHI area. I'm here from HITRANS which covers Orkney, [Unclear], Highland, Moray and most of Argyll and Bute. SETRANS covers Shetland. SPT covers North Ayrshire and the Highlands and Ben Lomond area of Argyll.

I'll just skip straight, though, from the fact that we are developing our regional transport strategies at the moment. They will try and bring on into consideration the draft and emerging recommendations from STPR. The process is quite similar and it will be consulted on. We're at various stages of that. But this paper also sets out some of the key transport challenges facing the Highlands and Islands today. There were significant concerns raised at the last CoHI, particularly around island connectivity as ferry services have been impacted by reliability and ageing fleets and bad weather. Long-term investment plans are covered in the paper and will be presented or touched on by Nicola.

Progress has been made on developing a fair revenue funding settlement for local authority ferry services. I think that's something that's welcome and worth acknowledging. It's been through significantly good partnership working across local, regional and national government bodies. But in common with the Clyde and Hebrides Ferry Services, there is an urgent need for substantial capital investment in vessels and ports. The recent purchase of [Unclear] for the CalMac fleet will improve resilience, but the impact over the annual dry docking schedule again show how fragile the reliance on an ageing fleet is becoming and underlines the need for pace in any new vessel investment programme or when the opportunity for charter or purchase of second-hand vessels arises.

The Highlands and Islands have a proud track record in supporting the energy transition and we'll play our part in transport decarbonisation. There are exciting plans for hydrogen across the region.

Some of our local authorities are at the top of the Scottish table in terms of active travel statistics. However, there has been a significant reduction in local bus services with one in five of Scotland's supported bus routes cancelled in the five years before the pandemic struck. While government has made positive commitments to a Bus Partnership Fund aimed at improving bus running time and tackling congestion along with increased concessionary fares investment, these programmes will benefit urban areas more than rural. If the Highlands and Islands are to play a part in the drive to reduce vehicle kilometres by 20 per cent, we need to find ways of building back rural bus services to offer everyone an alternative to the car. The paper sets out some opportunities for that, but I [wouldn't] dwell on it in the presenting. I'll hand over to Nicola now who can take us through some of the progress in areas including aviation. The next slide, please, and over to Nicola.

John Swinney:            


Nicola Blaney:             


John Swinney:        

We're going to have to get some engagement, I'm afraid. The presentation's far too long. It should not be planned for this length of time. Nicola, is this your last slide or what?

Nicola Blaney:        

No, I'm afraid it's not, Deputy First Minister. There's four slides remaining.

John Swinney:        

Well, okay. I'm going to call a halt there, okay, and I'll open it up. We need to reflect on that for future sessions to my team. It's far too long. Okay. Thank you for your input there. I'll start to take some contributions, because we need to air some of these issues. Okay, James Stockan first.

James Stockan:      

Yeah. Thank you very much, Deputy First Minister. We could probably speak as long in questions as the presentations and longer, but I'm not going to do that.

I'm just going to take you back to the last time that Transport came to CoHI. I think it was in November 2017 when we had a resolution or an outcome that we would work on the worst first and make sure that all the people at the convention took that line. I'm just wanting to make sure that that is still our position, because so often I see things, what I would almost say - many people speak about jumping the queue, because there's pressure from a group or whatever. I'm just really interested to make sure that we keep that as a principle, because I think that's the only way we can really understand. I think there's so much in this section that I would ask that we could actually in CoHI look at transport more frequently in smaller bite-sized chunks. Thank you very much.

John Swinney:                         

Thanks, James. Mary?

Mary MacInnes:      

Thank you, Deputy First Minister. If I may ask a question please, does this include roads? Most of South Uist and Barra have single-track roads. While there is work planned for points of entry and so on, I'd just like to find out if the roads throughout the islands are part of the development as well because, without improvement on the roads, it'll be more catastrophic really if all the things happen.

John Swinney:        

I think on that point, unless - from almost all of the roads on the islands, I would think - and I stand corrected, possibly, they will all be responsibility of local authority plans. I don't think they'll form any part of the trunk road plans [unclear] the government's responsibilities. STPR obviously looks at a bit of a hybrid between the two, but colleagues can reflect on some of those points in the course of the discussion. Okay, Alex Gallagher and then I'll take other contributions, please.

Alex Gallagher:                                           

I'll try to be short as I can, Deputy First Minister.

John Swinney:                                           

No. Alex, no, say what you've got to say. I'm...

Alex Gallagher:           


John Swinney:                       

...keen to hear folk.

Alex Gallagher:       

We welcome the Fair Fares Review. I mentioned our island plan. That's one of the targets that we have put in our action plan to get the fair fares and to [find any] idea that we could get discounted travel of all types, not just ferry but bus and other types of travel.

The one thing that I would say about connecting two ferry ports and stuff that was mentioned earlier, we in North Ayrshire were disappointed that STPR2 did not take up any of our suggestions for improvements to roads. In particular, the one that affects this meeting is the B714 which runs straight to Ardrossan. We put in a bid and it wasn't successful. But if our aim is to improve the connectivity and make it seamless travel, then I would have thought that that bid would have been given a bit more consideration.

Ferries, just a little - I told you my anecdote about Arran. Cumbrae this winter has been an absolute disaster. Loch Shira had a problem. It's a big ferry. It had a problem, just before Christmas. Had to go into dry dock, didn't come out for more than three weeks. The replacement ferry came. It failed and had to go into dry dock. We have a whole series of horror stories culminating in [a week on] Friday with 60 people stuck on the island and islanders unable to get onto Cumbrae. Just to emphasise that that connectivity isn't just a theory. It's absolutely real. If you've got 60 people on Millport which has only got 1300 people, you're going to be very pressed to find beds and toilets and things for them.

But our main message is STPR2 has been a bit of a disappointment to us. Thank you.

John Swinney:                                                       

Thanks, Alex. Margaret Davidson? Not hearing you, Margaret.

Margaret Davidson:                                                  

Thank you. It would have taken me a while longer to

realise myself. Right. Two things I'd just like to raise. Well, James is right. This is such a complex area. We need to put it into bite-sized chunks. But two things.

First of all, hydrogen. I'd really appreciate some discussion at national level about support for hydrogen on rolling stock on our rails. For us it's a huge opportunity for the north and the west lines which - moving to electrification will just - it'll break the bank. Whereas hydrogen - and I believe there is hydrogen rolling stock being produced now, that it is underway - is a huge opportunity for the future. I'd like to see further national discussion and support for that. That would be really good.

The other thing is as we all wrestle with the move to low carbon and as we all wrestle with our City Deals and delivery, it really would be good if the associations that we need to use to get us there were working at full tilt. At the moment, it's impossible to get motion out of [Sustrans] for feasibility studies. They've more or less closed the shutters for some months. Is there no way we can get around that so that we can get on? Also with Transport Scotland it's been like pulling teeth for some time. We now have severe concerns about delivery on our City Region Deal. Indeed east Inverness and the East Link that we've been waiting for forever is absolutely key to the growth of Highlands and to the absolute necessary developments around our schools and infrastructure there.

Is there any way we can help accelerate some of this? Is there something more that we can put in to help get this going? It's just about keeping the pace up with all the opportunities again that are in front of us. But any comments on hydrogen would be very welcome. Thank you.

John Swinney:                                      

Thanks, Margaret. Graham Leadbitter?

Graham Leadbitter:

Thank you. It would be remiss of me not to pick up on the A96 when I have the opportunity to. There is a major issue with the A96 that we're all aware of. It's an extremely busy road. It dissects, or bisects rather, Elgin which is - we're heading as a town towards a population of about 30,000. It's a real discouragement to get people into active travel for short routes, because they don't feel comfortable crossing such a busy road, particularly on bikes. It's really not the most comfortable town to cross north to south on.

In terms of rail, we still need to continue the investment that - the excellent investment that's happened over the last few years has made some really significant improvements to the rail line. There's still some further opportunities there to decrease journey time between Aberdeen and Inverness. These are all things that very definitely for me need to be picked up in the next period.

In terms of the overall A96, I think we need to be careful that we don't lose the opportunity to invest heavily in renewables because we don't have the infrastructure to support the supply chain. The supply chain includes our harbours. It includes some of the largest amount of transmission equipment anywhere in Europe, which is in Moray. There are frequently large loads running up and down the A96. If we don't deal with that by significantly improving the journey times and focusing on the decarbonisation of the fleet rather than the future capacity of the road, then that I think will be - it will actually be a discouragement to getting people to travel in a more environmentally friendly way.

In addition to that, we've also got the excellent economic investment that's going on in our distilleries, but in essence our distilleries are basically 60 very large chemical factories in Moray that produce large quantities of liquid and waste and recyclables and all the rest of it. But you all know through the night in Elgin that there are lorries passing through the middle of the town every single hour of the day, every day of the year, every 15 minutes or so. That's because of the nature of the industry that we have in Moray.

I would simply urge that as we go into this next period of investment that these points and the need to invest in improving that infrastructure has never been more critical than it is now to support the decarbonisation of our economy, because if we don't have the right access to the harbours that support the offshore windfarms or the right access to the electricity infrastructure that supports the onward transmission of that - and potentially there are huge opportunities for us as well from hydrogen production in Moray, because it's next to where that energy comes onshore. All of these things require major investment. They will attract significant construction projects that need good access and which will support our route to net zero. As I say, it would be remiss of me not to make those points.

John Swinney:        

Thanks, Graham. Shona MacLennan and then I'll come to Alastair Cooper.

Shona MacLennan:

Taing mhòr Deputy First Minister. It was just to make the point about the welcome introduction of free bus travel for under 22s. We responded to the consultation on that, recommending it be extended to free ferry travel and particularly in light of population retention in the islands and providing equality of experience for young people. It was not taken up at that point, but it's a request that that could be reviewed and considered again. Taing.

John Swinney:                           

Thanks, Shona. Alastair?

Alastair Cooper:      

Thank you, Deputy First Minister. I'll be quick. In Shetland we have a continual problem of two freight vessels which are very weather dependent. I think the Transport Minister is aware of the Shetland situation to some extent. This winter has been particularly bad.

I was talking to one of the fish buyers the other day. We export more than Orkney and the Western Isles combined, salmon, mussels and white fish. Of course, everything has a shelf life nowadays and you have to get to the market as quickly as possible. The problem we have with the freight vessels is that the fish and the salmon and such like goes on the freight vessel and she doesn't come into Aberdeen in the early morning. You don't get to Bellshill in Glasgow. It's redistributed by midday. If it doesn't get there by midday, then it lies in Bellshill until the next day and, of course, [you've used your] shelf life...

I was talking to one of the fish buyers. He was saying that he used to sell quite a lot of fish to Fraserburgh and Peterhead for cutting on a Thursday, Friday for the weekend market. They've actually stopped buying from Shetland because of the unreliability of getting their product. The net result of that, of course, is lesser price for the fish when it's sold in Lerwick. There are fewer buyers for it. Ultimately that reflects back on the council, because we have the fish market in Scalloway. Another fish market, the dues on fish landings is an ad valorem charge, in other words £0.025 per £1 value of fish. We lose income as well. I know that we have freight vessel design on the cards at the moment. I would just ask that we bring a degree of urgency into that given the extent of the exports from Shetland, which accounts to about 40 per cent of the local economy.

Lastly, and very quickly, Fair Isle ferry need to be replaced. We're in an application to the Levelling Up Fund. Presumably the Scottish Government will support that application to the Levelling Up Fund for the Fair Isle ferry.

John Swinney:                               

Okay. Thanks. Alistair Dodds?

Alistair Dodds:        

Yeah. Thanks, John. Who'd be the Transport Minister? [Unclear] Gilruth is really enjoying it so far.

Just a couple of quick things. The first is I'm really pleased that we are looking at this longer term, but I think we really need to look at what's also in the STPR2 about remote and rural areas and island communities. My second comment really relates to - well, I'm all for long-term strategies and plans, but we really need to be and Transport Scotland really needs to be open to suggestions in the short term. I've been talking to businesses and communities. I'm sure Ms Gilruth has heard this as well. You heard Alex about Arran and the other islands down there. But it's coming elsewhere as well. I just make a plea that when suggestions do come forward that they are given consideration. I'm sure Ms Gilruth will pick that up and has been picking that up. I think it's really important that we try and address the short-term anxieties, worries and the impact on business and communities. Thanks.

John Swinney:        

Thanks, Alistair. Any other contributions from colleagues? Yeah, I'm conscious of the significance of the transport issue, so I'm anxious that everybody has the opportunity to say their piece today. We will come back to some of these questions in future meetings of the convention. Okay, there's nobody else come forward. Right. Jenny, do you want to lead the response to that and draw on Ranald and Nicola's contributions and any issues that you weren't able to cover earlier on if they can be reflected on? Okay. Thanks, Jenny.

Jenny Gilruth:         

Yeah, thanks, DFM. There's a number of points here. I'm aware we're over time, but I think this is a hugely significant...

John Swinney:                                

No, please, just carry on, Jenny.

Jenny Gilruth:                  

Thank you.

John Swinney:                           

Take the time you need.

Jenny Gilruth:         

Alex raised a number of points around about, for example, the Fair Fares Review. I think that Margaret may have touched on this earlier today, looking at how we better join up, for example, different modes of transport. Now I hope that review is going to give us opportunities to do just that. But I think one of the key themes coming through the discussion today is the need for change, potentially reform now, and the need for - I think Alistair touched on that - that shortterm solutions. To me as Minister, a number of the things that I'm facing just now [unclear] challenges, but it's absolutely essential that we get some of these challenges right for the communities and we get our solutions in government better, I suppose. I think we need to better reflect some of those challenges in our thinking and come up with an approach which gives people certainty and clarity that we are listening and we are able to respond to challenge.

Alex raised a number of challenges around about Arran and Cumbrae. I'm [well cited] on those, particularly in terms of our vessels at the moment and in terms of their reliability. I'm meeting with CalMac, just for people's awareness, next week. There will be a statement to parliament later this week from the Finance Secretary on 801 and 802 which are the vessels sitting in Ferguson's. I intend to bring a statement additionally, looking at the options which we're being presented with through the Project Neptune review which you will all be aware of. [Provide us] with a range of different opportunities for reform and change in the future. But that is a longer-term solution and I need to think about what the short-term options are here today. I'm keen to work with CoHI members on that and on delivering for our communities.

Margaret raised a number of issues around about hydrogen on rail. Now we have a pretty ambitious decarbonisation programme for our rail network and infrastructure. Nonetheless the North Line, for example, provides us with a number of challenges which traditional electrification, I am told, would not work with. We're therefore looking at battery, for example, as an option there. If Margaret would like to discuss this further, I'm sure officials can pick that up and give her more of an update on where we are with North Line in particular.

On the City Region Deal, I think there was a challenge here raised around Transport Scotland potentially holding this up. That is not something that's crossed my desk, but can we take that away please, just TS officials who are here, to look at that?

On the east Inverness development, I visited the new railway. It must have been last month now. I think it's a fantastic example of investment from government joining up transport infrastructure and journeys. You're connecting not just the communities from Inverness and north but also thinking along the east coast to places like Elgin to an international airport hub. It's a really good example of actually some of that challenge that we spoke to at the start of the meeting around about transport infrastructure.

Hello to Councillor Leadbitter. Nice to see you. I think we're to meet soon on the A96. He will understand and know that I have had a bit of representation on this additionally from the local MSP. I am keen to meet with Moray Council, too, to get a better understanding of your frustrations on this issue. You will know, though, that the plan is still to dual the A96. However, the Bute House Agreement commits us to undertaking further analysis on the route. That review is being carried out. It's just been initiated and it will conclude by the end of this year.

Graham, I know you raised a number of issues around about opportunities on rail, too, and reducing journey time. One of the things we were looking at and I know ScotRail's looking at is how the new Inverness airport, for example, will be able to provide that for Elgin and particularly for the part of the world that you represent and looking at opportunities through that route. I thought you made some really good points around about the importance of the whisky industry to Elgin. As you know, I used to live there, so I recognise some of what you've discussed and supporting more broadly that decarbonisation agenda too.

Shona, it was very helpful to hear some of your feedback on under 22s. I know there were a number of challenges initially with the rollout of the scheme. I am told that things are getting better, but I think there's still improvements we can make in this. The really important thing is that we get as many young people signed up. I just want to thank local authority partners in particular who may be with us for all their assistance on doing that, because it's not just the online application process we have. There are also the local authority routes too.

There's a plea here for us to look at ferry travel. Now this was considered at the time, I am told, at the inception of the scheme. It was decided not to proceed. However, it has been raised with me by a number of other elected members. I am broadly sympathetic to it, so I will come back to you on that. There's another review being undertaken on under 26s in terms of concessionary travel, so I'd like to wait until the outcome of that review is published, Shona, before giving you a more definitive answer. But that will be in the next couple of months. You'll be aware that we're coming into local elections period and therefore we can't publish that review until after that has concluded.

Alastair raised an issue on the freight vessels in Shetland, which I am [unclear] on. I think I'm meeting with Shetland [haulers] later this week actually. He asked for an injection of urgency on this. I will happily take that away, recognising some of the points he's made around about the challenges with regard to fish and what that means for getting fresh stock to market. I think that was a really important point that you raised.

I think just to conclude again with Mr Dodds' point around about short-term solutions. He also asked at the start of the meeting for real action by the next meeting, so I'm listening very intently to that today, Alistair, and to everyone else who's made a number of suggestions here to think about what action we can actually deliver on by the next meeting. I hope that's a fair summary of where we've got to. I recognise very much, though, on the ferries point, the need for action on this. I'm keen that we are able to deliver on some of these things in the near future. I'll pause there. I see Alastair has a hand up. I don't know if he wanted to come back in or if that's a legacy hand.

Alastair Cooper:                        

Sorry, that's a lazy hand.

John Swinney:        


Jenny Gilruth:         


John Swinney:

Nicola? Ranald, Nicola, anything you want to add to what Minister said?

Nicola Blaney:        

No, nothing further. Thank you.

John Swinney:        

Okay. Thanks very much. Ranald?

Ranald Robertson:  

No, I think the Minister covered things very, very well. The one point I would maybe add is [the fact that] £580 million programme of investment in vessels and harbours is scheduled to 2026, so hopefully that at least gives some confidence that urgency will feature and pace will feature in that.

John Swinney:        

I think the issues that have been raised about particularly the west coast ferry situation, although Alastair's raised issues about the freight vessels for the Northern Isles and Shetland in particular. On the west coast, quite clearly investment decisions have been made and applied over a number of years with significant enhancement of vessels, but the delay in the two vessels in Ferguson's has quite clearly increased the fragility of the network. Ministers are acutely conscious of the challenges over this - the period of maintenance over - the combination of maintenance, weather and COVID has been extraordinarily difficult for the west coast and communities.

Now in all of the resilience conversations that the government has been engaged in - and this has also involved local resilience partnerships - we have been anxious to ensure that there has been an effective service to support essential requirements on islands. Now that is different from making sure that a reliable service can be provided in accordance with the winter timetable. I recognise that's not been possible. But there has been a focus with local resilience partnerships on ensuring that islands were serviced. It does command a significant amount of ministerial attention to ensure that's the case. Obviously there's new capacity coming in with the

[Loch Frisa]. There have been further investment decisions that have been announced. Obviously the completion of the vessels at Ferguson's is a source of concern and frustration given the impact that those will have.

I think there's a lot of issues in there. I'm very mindful of the need for us to make sure that transport commands a significant amount of attention at CoHI. I couldn't have said that it was 2017 since - it doesn't feel to me like it was 2017, the last time we discussed transport. James, you may be correct to that at a strategic level, but I think these issues are frequently up. I think we should have, at the CoHI in the autumn, a more substantive discussion on transport. I think we should engage with partners on what are the key issues and elements that partners wish to raise about the transport situation so we can do justice to it at that session in the autumn.

Okay. Any last observations then? [Pause] Okay. Right. Thank you very much. Thanks, Nicola, Ranald and Jenny for that. Now what we'll do, we're running a bit late, so we'll just take a short break just now. We'll reconvene at 25 to two, 1:35. Okay. Thanks very much. Thank you.

Okay. Afternoon, everyone. We'll recommence our discussions. The next topic is an update on and discussion on labour market and skills. This is an issue we've looked at on a number of occasions before in the convention.

Fundamentally we are operating in a context where - and we touched on some of these issues earlier on today on the question of population where we have challenges about the number of available people within the labour market to meet the demand for expanding and developing organisations. Equally we face challenges in meeting the demand to operate public services in some communities given the challenges around the number of available people within the population. That essentially collides with some of the other issues we've wrestled with today around about housing. But it's obviously influenced significantly by the loss of free movement which was a significant benefit to the Highlands and Islands economies. Our labour and skills interventions then have got to be much more finely tuned to the context and the environment in which we're now operating in that context.

We'll go through some of the thoughts around about that in opening up the discussion just now. I'll ask Stephen Sheridan to open up with some brief comments and then I'll open it up to colleagues. There's a paper that's been circulated, which updates some of the progress on labour market interventions and approaches. It's obviously central to the agenda on economic recoveries from COVID. Stephen, if I can invite you to take us through things - thank you.

Stephen Sheridan:

That's great. Thanks very much. Good afternoon, everyone. We have a short presentation, so if time allows, we'd hope to keep it maybe about seven minutes maximum to get through this. Then hopefully if that's acceptable, we'll leave plenty of time for discussion. As part of the presentation, I'll bring in two colleagues to present a very short case study, so Vicki Nairn from UHI and Councillor Leadbitter from Moray Council will join in as well. But as I said, we'll get it well within the time allocated.

John Swinney:                        

[Unclear]. Thank you.

Stephen Sheridan:

Next slide, please. Just as it was introduced, the context I think for the paper is that we've had pre-existing conditions that have led to the development of an original Skills Investment Plan, addressing some of the longstanding challenges that would restrict economic growth. While many areas are going to face depopulation, we're all facing a significant increase in our non-working age population. The forecasts are quite startling, so by 2043 we're looking at our dependency ratio going up nine per cent to 74 per cent. Against the backdrop of Scotland being around 60 per cent dependency ratio in that timescale, I think it highlights the importance of the repopulation work that's underway.

To work our way to recovery, the pre-existing challenges are compounded by the impacts of EU exit now as well, the impact of COVID on short and long-term sickness and changes in student behaviour as a result [in] students leaving the area in greater numbers as well. What we don't really know as well, these are new trends or they're more temporary effects [unclear] we do know that the cumulative effect is creating enormous pressure on population, skills and talent. Next slide, please.

There's a lot of information here around changes to the number of people in our area who are economically active, so I certainly won't cover it all. But we're facing into probably about 12,000 less people in the labour market in the year [looking] to September 2021 than there was two years ago at the same time in 2019. There's been an increase in students, an increase in retirees and an increase in people who either do not need to or want to be in the labour market just now. Employers are obviously experiencing supply and inflationary pressures as well as the wellpublished labour shortages in the key sectors to our economy. Next slide, please.

The paper sets out the ongoing response to the challenges and I think demonstrates that we've got a really good mix of national, regional and localised solutions. If we can just pick up on two very briefly, UHI's current curriculum review I think is very important. It's going to aim to ensure programme support, current and future workforce needs. Alongside that, there's obviously the consultation around the merger of a new rural island college, which I think is a really positive case in terms of the benefits for communities, learners and staff.

Then just to pick on the one that we've discussed frequently already today around economic investments which create education, training and employment opportunities and anticipation of the rapid upscaling of offshore wind. There's certainly work underway to expand offshore wind training and build both the capability and the capacity of training networks. There's also some great work happening around health and social care where we've got [unclear] and immediate challenges as well. Next slide, please.

The February REP, members gave a clean direction to focus efforts on meeting the opportunities and accelerate action on the ground. Before I touch on that, I suppose it's just worth setting the wider context of future job opportunities across the region. For the Highlands and Islands, there's nearly 88,000 job openings forecast over the next 10 years. Of that, 83,000 is replacement demand and around 5000 people required to fill job openings due to expansion in the labour market. It's a significant number considering we've got a current working age population of around 234,000 people. Next slide, please.

Margaret made a good point earlier, I thought, about the importance of providing a positive picture of our area and reinforcing that it's an area of opportunity as often as we can if we're going to try and grow our working age population and attract inward investment. The outcome of the planned investment should make significant opportunities around job creation as well as skills.

As Calum Iain highlighted, we've got a shared understanding through the REP of the key sectoral opportunities which are listed here. Energy's obviously one we've touched on before, particularly ScotWind. Early indications suggest that across the region there's potential for up to five green hydrogen hubs, five integrated manufacturing facilities, several marshalling and assembly bases and seven O&M bases across the region with conservative estimates just now probably around 4000 jobs in the HIE area, all requiring a skills response. That's just one of many opportunities we've identified through the REP and that we're working to quantify just now. If you add in the deals which is over £500 million of investment, the Island Deal alone is potentially going to create about 1300 jobs that attract and retain talent. Next slide, please.

If I close my section with the proposed response, so through the collaborative work with partners, we've identified four proposed key action areas for consideration. Firstly I think it's important that HIE and SDS continue to gather insight, including direct engagement with employers on skills shortages. While the focus rightly needs to be on delivery, I think we need [unclear] to support partners targeting the resources to ensure we have the greatest impact of our investment. We've repositioned the HIE Skills Leadership Forum as the REP Skills Subgroup. This will help ensure that any skills actions undertaken will flow both from and into the REP and enhance the work that's happening through the Repopulation Activity Group. We propose that we work with partners to implement an ambitious workplace skills strategy, linking provision to the economy and supporting young people to remain in the region.

Thirdly convention members can support aligning the investment skills behind emerging opportunities as they arise. As discussed I think we proposed we start with Scotland, building on the national work around the Scotland supply/demand statements and try and gain a forensic understanding of the requirements, both regionally and then on each site, to work with the provider network to ensure we've got appropriate provision.

Finally I think it's important that funding bodies - SDS, SFC - work with all providers to ensure we've got a balanced portfolio of provision between the best of the academic pathways, workplace training and upskilling and reskilling. I think the investment [unclear] and skills should focus both on driving economic growth and supporting skills development.

We thought it would be really good just to spend a couple of minutes giving an example of where the investment will have a direct impact on provision, so if I could briefly introduce Vicki Nairn from UHI and then invite Councillor Leadbitter just to say a few comments - and then we can close the presentation and hand back for discussion. Over to you, Vicki.

Vicki Nairn:

Thank you. Good afternoon, everybody. Thank you to Stephen.

Stephen, picking up on one of your points, it's very much a region of opportunity. UHI wants to drive that forward, an example of which is our MAATIC project, very much based on an ecosystem approach. In line with the tertiary model and that whole holistic view, we want to make sure that our education provision links in to a sustainable place-based approach so that we link school, industry, higher and further education, creating a pipeline for jobs and actively engaging with employers and also with our partners. That will in turn create sustainable communities with well-paid jobs. It will attract industry and greater equality of access with less climate change and very much breaking down those barriers, the traditional barriers between industry and academia, and also promoting research. Focused really on aviation, aerospace and manufacturing, huge opportunities in the Moray area but also across the Highlands and Islands. We'll deliver training, research and knowledge exchange, working with our partners across the Highlands and Islands. Next slide, please.

Very much wanting to look at how we connect digital engineering both in Moray but also across the wider piece. We have 35,000 students in the University of the Highlands and Islands. We want to use those and use our sites. As you can see there, we will link, for this project, to sites in Fort William, Perth, Inverness,

Stornoway and Thurso. We'll also work with national partners, including the National Manufacturing Institute. Certainly UHI in our work that we've done has contributed over 560 million to the economy in the Highlands and Islands. We really want to drive that forward and make sure that we are taking our part in transforming communities and industry in that place-based approach. I'll stop now in the interests of time, but happy to chat about this separately. Thank you.

John Swinney:                                         

Thanks, Vicki. Graham, are you coming in?

Graham Leadbitter:

Yeah, just very briefly if I can just do a quick canter through the last time - [unclear] don't worry, I'm not [unclear] - back to 10 years [past], last July. We had the community campaign to save RAF Lossiemouth, which many of you will remember and many of you were involved in different ways. Certainly one of the consequences of that was a really much deeper understanding of the need and what we needed to do to diversify the economy in Moray.

One of the things that we've had for a long, long time, for decades is loads and loads of aerospace people, but you could only get into aerospace if you joined the RAF and you could be posted anywhere in the world. You wouldn't necessarily come to Moray. Now what we've got with Boeing there and with Boeing's investment in - or Boeing's investment and partnership with the MAATIC project is a real opportunity to massively grow a civilian aerospace sector and have a direct line of sight from children in school all the way through to getting a job in the aerospace sector without necessarily having to leave the region, that they can do the training in Moray and that they can get placements and apprenticeships and all the rest of it. That line of sight from school all the way through is a sea change.

It ties in really neatly as well with the space work that's being done by the likes of Orbex who are building the rockets that will be launched from the far north. That's potentially well over 100 jobs, literally working in rocket science. When they say it's not rocket science, it is sometimes.

That I think is the most important thing I've learned in the last 10 years is that that diversification is critical. We now have a civilian aerospace sector in Moray that has literally hundreds of jobs in it from having pretty much no civilian aerospace sector in Moray only five years ago. That's quite a phenomenal achievement, I think, and one that we need to sing more about. It's a really good result. The investment in the partnership with the Growth Deal and the partnership that developed from the community campaign to save RAF Lossiemouth are major contributory factors to where we are at the moment, so that's my thoughts on that.

John Swinney:        

Thanks, Graham. Thanks to Vicki and to Stephen as well. It's a very interesting presentation which I think gives us some reassurance about the place-based interventions that we talked about way back at the start of our discussion about Regional Economic Partnerships where essentially - and Graham characterised this or put it into the context of a 10-year challenge that by combining the efforts of a range of organisations, creating the platform for private sector investment, can therefore create an approach which enables us to use our highquality skills infrastructure, high-quality learning environment through UHI and to do that in a way that strengthens local economic footprints.

In a sense, we don't need to go to invent the model. We can see how the model works. It's just we need to make sure we're applying that intelligence to make sure it happens around the Highlands and Islands. Of course, there are good examples of where the opportunities for that present itself, whether it's the Deep Water Port in Stornoway or whether it's the renewables developments in Orkney or whether it's some of the nature-based investments in Argyll and Bute. There are possibilities in all of that.

Right, we'll open it up to discussions. I'll come, first of all, to Margaret Davidson.

Margaret Davidson:                                                                  

Right. Sorry, slow about it. Thank you. Thank you, Deputy First Minister.

Can I begin by saying thank you for the paper? I think Skills Development Scotland led on it. It's a good paper, thoughtful, pulls everything together and actually tells us that really this is in our hands now. This is for us to pick up and to work with. I think that's what we have to do. Frankly, I've been taking the challenge home because - go into our schools and we have a hugely successful STEM and the Newton Rooms, all the work around the City Region Deal. But does that translate into keeping our young people and getting them into work [unclear] opportunities in Highland? Not enough, nowhere near enough. It's really for us now to embrace that, for all of us to get behind our tertiary education, to support it as much as we can, to understand what its needs are to get where it needs to be and to thank them for all they've done so far. But this is a whole new chapter. We all need to be moving on that, so I think it's about making the whole thing work.

But I'll go back to something I touched on earlier and which I think is vital here. It's about communicating with our citizens. It's about convincing them that they're actually looking at these massive opportunities. It's about making sure that if an offshore wind developer is in town, they go down to the local [unclear], they don't start talking to people who say, oh, no, my kids are going down to Strathclyde. There's more opportunity for work there. To me it's about getting everyone onto the same page and understanding where we are and making the whole system work. We've got some great bits and pieces going on, some great big pieces going on, but the links are not yet secure. We need to be looking at the whole system working as well as it did in oil and gas where we had a great pipeline of jobs. We had the terrific pipeline of contacts and people bringing forward [unclear] many years. The same thing is looking at us, but we're going to have to work hard at it and cooperate.

I'd just like to commend those who have been leading on this, on that paper and particularly Skills Development Scotland. Good work.

John Swinney:        

Thanks, Margaret. I think the crucial point you make there, Margaret, is the fact that there is a tertiary education infrastructure here of the highest quality linked very much with the school infrastructure as well. The trick is to make sure that is aligned with the economic opportunities to create seamless pathways. That's what Vicki and Graham's example of the situation in Moray demonstrates. You're absolutely right. There will be pipelines of that type around renewables developments. There's obviously very significant developments at Nigg as one example. A lot to be optimistic about, but it's got to be turned into practical reality. Thanks, Margaret. Alex Gallagher and then I'll come to Mike Cantlay.

Alex Gallagher:       

Thanks, Deputy First Minister. Thanks for the presentation. It was interesting.

This is maybe nit-picking. I'm not really sure. But you gave a list of your opportunity areas which included energy, blue economy, food, drink, tourism, space and aerospace, life sciences, creative and heritage industries and education sectors. I'm sure you haven't missed it, but I think the green economy is a big opportunity. You did mention hydrogen, but you haven't put that on your list.

The reason I say that is that what we've done here, we've got a 10-year net zero - North Ayrshire plan to achieve net zero within 10 years. As part of that, we have created a £500,000 green jobs fund which we use to give some funding to local companies as part of our economic recovery and our Green New Deal. We use it to support businesses and community organisations to adopt new practices, innovation, things like the [unclear] economy, renewable energy, reduce energy costs for businesses, that sort of thing, and upskill and reskill the workers so that they can work within a green-facing economy which we're trying to create alongside all the other blue and green and other economies, sea economies. We also use a community wealth building approach for [unclear] and so I think it ties in with a lot of the strands. I might be nit-picking. I'm sure you haven't missed it, but I just thought I'd mention it. Thanks.

John Swinney:        

Thanks for that, Alex. We'll come back to those comments in summary. Mike Cantlay, then I'll come to Stuart Black.

Mike Cantlay:                                                        

Yeah, okay. Thank you. I was going to make two quick points.

You mentioned, Deputy First Minister, we have a network of the highest quality in UHI. I think that is a point we need to register. In case my colleagues from UHI don't,

I will.

Elsewhere we've been talking about the Scottish Funding Council review. Out of that, one of the key features has come, the proposal of tertiary pathfinders we call them, which are initiatives to drive those seamless partnerships that you were talking about, DFM. They are driving forward in the south of Scotland and the north east. We've not posed one for the Highlands and Islands, because you've got one. You've got UHI. It is a perfect model to help take us through this stage in the development of the Highlands and Islands. I think we should have confidence in it. We need to support UHI wherever we can, in particular colleges with their links with the local business communities. They have the learners banging on their doors. Certainly, our job at Scottish Funding Council is to provide whatever support we can and flexibility we can as the institution pivots into that demand.

The second point - and it's to reinforce Margaret Davidson's point, because I would have it as a fifth action. This won't work without taking seriously Margaret's point in terms of communicating. What an opportunity we have in the Highlands and Islands. This is a very unusual labour market. I've never seen anything like it, in particular in the Highlands and Islands. The reality is learners have I think probably unparalleled choice as to what they want to do careers-wise or study-wise. They choose what they want to do. We have the opportunity to influence them by inspiring them as best we can and not just individuals but, as Margaret was saying, the wider communities and other peer group pressures and interests that might help us along the way.

Actually around the table today, I think it's incumbent on us all to look to see what we can do to help to inspire the workforce of the future as to where the opportunities are. If we are able to achieve that, I really do think that we can make great [unclear] in terms of taking matters forward. We would certainly do our bit at Scottish Funding Council.

John Swinney:                                           

Thanks, Mike. I'll come to Stuart Black. Stuart?

Stuart Black:

Yes. Thanks, Deputy First Minister. I think this paper is really important for two reasons. One is that for the first time, if you look at para [2.6], first time in a decade the whole region has suffered a fall in population, which I think is a concern. We've had pretty much 30 to 40 years of uninterrupted population growth, not in every part of the region but in the region as a whole. That is definitely a worry. On the other hand though - and back to Mike's point about messaging - it's a region of great opportunity. In the subsequent paragraph, it talks about 87,500 job openings including 4500 new jobs. We've talked about ScotWind already today. We estimate that that could create 4000 jobs in our region. We have to get the messaging right about this being a region of opportunity.

I think the skills system does need to, though, react more closely to the needs of employers. There's a lot of need for employees in sectors like tourism, in engineering. The skills system at the moment takes quite a long time to deliver outputs for these people and these sectors. I think we need to look at speeding up delivery in many of our industries and sectors.

I think the other thing we need is more housing. It comes up regularly around availability of labour, particularly in rural areas. We've got to look at how we deliver housing more quickly. We've been working with a lot of community groups across the region on housing. I think Councillor Caddick mentioned the Aviemore seminar earlier. That illustrated that, to meet the labour market needs of Badenoch and Strathspey, there's around 500 houses needed. Now the local plan, the parks plan doesn't allow for that number of houses, so we need to make sure that we get our plans and our delivery on housing aligned.

I really think skills is one of the most important things. When we're dealing with investors, they always ask, where are the people coming from? Can you guarantee they'll be here? Can you guarantee they'll have the skills? We really need to get this joined up. Just bear in mind the population seems to be falling whilst we've got huge opportunities, so let's make sure we send out the right messages about the region. To young people as well, Margaret mentioned the Science Skills Academy which HIE has been funding alongside the City Region Deal. That funding will end in a couple of years' time. We really need to look at how we progress that, because part of the messaging has to be to the young people of the region about the opportunities here so that they want to stay and make their careers here. Thanks.

John Swinney:        

Thanks, Stuart. I'll come to Alastair Cooper now and then I'll come back to Vicki Nairn. Then we'll begin to draw things to a close. Alastair?

Alastair Cooper:      

Thanks, Deputy First Minister. I think one of the things that we need to recognise is that young people today are being encouraged to stay on in school to get Highers and such like. In actual fact, for some they'd be better off to leave the school at 16 and go into a trade. In Shetland we're struggling at the moment to get young folk to go into trades, electricians, plumbers, joiners, bricklayers and such like. It's actually a very good career. It's a career where they can progress and get their craftsman skills and then they can do better and take that and go into academia. I think that we do need to do more to actually get young folk to go into trades. I think the colleges need to encourage that as well. That's something which is - in today's labour market, it's maybe not getting the attention it should be getting.

John Swinney:        

Okay. Thanks, Alastair. Vicki, I'll come to you and then we'll begin to draw this to a conclusion.

Vicki Nairn:

Thank you. Just really picking up a number of points, the UHI model is unique in Scotland in the tertiary model. We're actively part of all of the Growth Deals and the City Deals. I think that uniqueness is a huge opportunity, but it's also a challenge for us, certainly in the parts we play and the standing funding models for HEIs. I think we very much want to work with our partners and we are already working with our partners to make a difference to the young people in our communities but also the people who are retraining and reskilling and upskilling and going back into the workplace. That also includes the apprentices and the point that the previous speaker made about actually different paths for different young people, so it isn't always about going for a degree. It actually might be about learning to be a bricklayer or a mechanic, which actually then provides a service to their communities. Huge benefits of the tertiary model and huge opportunities. Thank you.

John Swinney:        

Thanks, Vicki. Stephen, do you want to come back on? Anything else before I sum up?

Stephen Sheridan:

Yeah, just a couple of points. Yeah. Thank you, Margaret, for the comments and the feedback. Alex, yeah, we certainly haven't forgotten about green economy. It's hopefully detailed in the report. We're doing a lot of work around the Climate Emergency Skills Action Plan just now that hopefully can kind of [play and] support your islands plan and the delivery there as well, so happy to have a conversation offline around that as well. Yeah, agree with Mike's point around communication. It should almost be an extra action as well.

Stuart, in terms of speeding up delivery, I think you're right. The two issues you raised are ones we're aware of, so we've got a couple of things coming up. We've got a meeting with UHI around welding including HIE and others just now, because that's [unclear] immediate demand and see how we find solutions to that and around food and drink as well with employers as well. These are the kind of areas that we're trying to identify where the greatest need is and try and act quickly on it as well.

Just finally for Alastair about the trades, yeah, couldn't agree more, the importance of traditional apprenticeships to island economies as well. There's certainly pathways into these that we've developed that we're speaking to the college about as well, hopefully that'll attract more people from school as well. Thanks very much, everybody, for their feedback and comments.

John Swinney:        

Thanks, Stephen. This has been a subject which has been discussed extensively within the convention over the years. I think Margaret's comments are appropriate in recognising the significant progress that's been made here in trying to ensure there is alignment. I think how I would characterise where we are, it's that I think we've established a good platform. The question is now the extent to which we are using that platform to the maximum. What I fear is that we will be constrained in trying to use that platform to the maximum because of the availability or the lack of the availability of population in certain circumstances, which then means that we've got to try to respond to that with a variety of different interventions whether that's on housing, transport, other public services, et cetera, et cetera.

I think what the convention should take from this discussion is that we have established that strong platform. The question now is to what extent can we use that to the maximum effect in pursuit of other opportunities? Again going back to the discussion that Roddie led at the start of the day, the Regional Economic Partnership is increasingly focusing on, well, what are those opportunities and how are we successfully going to go after them?

There's a second point which Alastair Cooper's contribution raises, which is about horses for courses. It's not obligatory for everyone to go to university. It is obligatory for everyone to get a good outcome from their education. Trying to make sure that we properly engage with every student as they're working their way through the education system, however young they happen to be, to get to a position where we can achieve a good outcome for each individual is absolutely fundamental, because that way we have the potential to maximise the use of the available human capital that we have.

I think Stuart Black's point is another blunt wake-up call for us about the fact that what we've been accustomed to over recent years, of essentially a constantly growing population base, is not a luxury that we have anymore. Some of the effects of free movement which has brought people into the area, the absence of that countering the loss of population, particularly young people, to other locations is a significant factor with which we have got to wrestle. We need to be very mindful of all of those factors in how we take forward this agenda.

I think that that's been a helpful airing, but I think it does require us to make sure we're using this infrastructure to the maximum extent possible. Okay, thank you for that. Now we'll move on to the final session of the convention today, which is a discussion around the National Strategy for Economic Transformation. We've been joined by the Business Minister, Ivan McKee. Ivan, I'm having a slight difficulty seeing you. Your [unclear] is not great. Maybe it's just my system. But I'll hand over to you, Ivan, to take us through this. [Pause] I'm not hearing you, Ivan.

Margaret Davidson:                          

He's frozen [laughs].

John Swinney:                  

Right, can I...

Ivan McKee:

Can you hear me now?

John Swinney:                                

I can hear you now, Ivan, yeah.

Ivan McKee:

Hi. We have some - I'm in Scotland House in London. They've got some fabulous technology here, but it doesn't seem to be working as effectively as it might do. However, as long as you can hear me, you don't necessarily need to see me. I see that Lisa's got her hand up. I'm assuming Lisa's going to enable the technology so that you can at least see the PowerPoint presentation I'm going to talk to.

John Swinney:                       

Yeah, we can see...

Ivan McKee:

Is that correct, Lisa? Yes, we have it on screen. Perfect.

John Swinney:        

We can see the PowerPoint, Ivan, so you carry on. I think if you keep your video off so we can hear you and your audio - okay.

Ivan McKee:

Indeed. Okay. Good. Thanks very much, everybody. Good afternoon.

Feasgar math. Great to be here. I'm really looking forward to talking you through the National Strategy for Economic Transformation which you will no doubt have had an opportunity, of course, to have read. I will go through fairly quickly the slides and really keen to have a discussion and get your perspective on it. Lisa, you are driving the PowerPoint. Can we move on to the next slide? Thank you. Great. Okay.

If we look at the overarching vision that's in NSET, we have this imperative to drive forward the wellbeing economy and the government's overarching priorities round about fair work or tackling poverty and transition to net zero, which really underpin what we're trying to do [and] that ambition round about a fairer economy and a greener economy alongside driving a wealthier, successful economy.

As we work through this process, we identified that you can cut this pie up lots of different ways, but the most logical way seemed to be into the five buckets that are identified there. Round about an entrepreneurial people and culture and I think that culture piece of that is important. Focusing on those new market opportunities, to a large extent in net zero but there is more to it than that, of course. Many traditional sectors have a lot of opportunities to develop into new markets here and internationally. How we tackle productivity and a real focus within that on regional productivity and how this work very importantly aligns with the work that's happening across the different regions of Scotland, playing to their strengths. The focus on skilled workforce - and obviously just caught the tail-end of the conversation you were having on that, so absolutely central to delivering what we need to do.

The fifth aim, programme, is round about a fairer and more equal society, how the economy can drive the government's agenda with regards to tacking poverty, both through creating new opportunities for people to enter the labour market and employment and good paid work as a route out of poverty and also tackling the challenges of in-work poverty and what the economy has a role and responsibility to deliver on that.

The final piece at the bottom is this culture of delivery which is very much about recognising that the strategies can talk a good story, but unless we deliver on them, then clearly they are worse than useless. Right through this process from the get-go, there's been a significant focus on what actions we want to take, how we articulate those, who we work to deliver them and how we will govern that process and track progress. The phase we're now into is taking those 77 actions to the next level of detail in terms of the specific action plans that sit underneath them and how they're going to be taken forward. Again this is a team Scotland approach, very much about working together across the piece to ensure that everybody is engaged to deliver on those actions as necessary. That's where this session is hugely important to have a conversation about how we take these actions forward together.

Moving on to the next slide briefly, effectively just saying that all of this is mutually reinforced which is no surprise. As we deliver on each one of these, it helps deliver on the other ones. Clearly there's significant areas of overlap, but we have tried to parse it out as best we can to be specific on the actions we need to take forward and that culture of delivery sitting right at the heart of everything else that needs to be done.

Moving on, some comments about how the strategy is different. Important to recognise again, rearticulate that fair work and that net zero transition are very much at the core of that wellbeing economy. Focusing very clearly on those aspects round about entrepreneurship, skills and enabling more people to be able to take part in the economic success is absolutely key and that very strong focus on delivery.

Also worth mentioning at this stage that the strategy is consciously very much aligned with everything else that has gone before and will come after, so we recognise there's a lot of strategic work already happened. A lot of good action plans are in place right across the piece, be that on digital or infrastructure or exports, inward investment or right across the economic landscape. NSET, it's important to recognise, sits across the top of all of those if you like. It's like the tabletop that sits on top and pulls all of those together. I include in that regional economic strategies. Some are in place already. Some are being developed as we speak. Also sectoral strategies which have got a key role as a delivery mechanism, reaching out to the broader business base to help implement what's in NSET.

Moving on, we've then got a bit more detail on each of the five aims, the five programmes, the first one on entrepreneurship.

Sorry, move on the slides. Oh. There we go. Oh. Right, sorry, back to number 1. Sorry, go back to - there we go.

Within each of the five aims, the five programmes, [unclear] a series of workstreams and, within each of those, a series of actions. I won't go through all of this in detail, because you've had the opportunity to look at that separately. But just touching on the overarching aim of each of these, recognition that the business start-up rate in Scotland, while it has been improving, there is much more to be done to get it into a place where we have comparable performance with other countries, the rest of the UK but probably more important the other small countries. Ireland, for example, has a business start-up rate almost twice that of Scotland's. The good news is that in Scotland the start-up rate amongst the younger age cohort, 18 to 24 year olds, has improved significantly in the last few years. It's now double the rate of population as a whole and is the best in the UK.

There is some progress being made, but we understand that we need to do what we can to drive a culture shift there and support those start-up businesses and very importantly work with them to grow to scale. That is one of the key parts of this. Also worth noticing within some of these actions on entrepreneurship, there is a focus on the public sector as well, so this isn't just about business start-up. That culture piece is very important. It aligns very much with the work of the Logan report on technology and with an aspiration to grow or an intent to grow that beyond tech businesses to wider sectors across the economy. Also an international aspect to this, how do we attract more entrepreneurs and entrepreneurial businesses into Scotland, working with the great sectors that we have already and ecosystems we have here already?

Moving on to the second programme which is round about new market opportunities, as I said before, this is about recognising what we're good at, focusing on that and doing more of it. It recognises that some of this is in the net zero space. Some of it is more broad than that. Some of it is in new technology. Some of it is in traditional sectors, for example food and drink and tourism where we have great work ongoing to innovate and move those sectors forward in frankly what is very often a globally leading position. It's about how do we identify those opportunities? How do we work to support those sectors? How do we ensure there's alignment between what government's taking forward, what the sector's recognise as their strengths and very much what the regions of Scotland recognise as their strengths?

A lot of this builds on the work in the inward investment plan and takes that to the next level across the broader economy. I think this is one area where that alignment between regional strategies and the national strategy is hugely important. It talks about the imperative of attracting more inward investment to Scotland, both in terms of FDI and capital investment, building on the plans that are already in place to do that and about how we grow businesses in Scotland to scale to take advantage of those opportunities, how we build clusters and work on the supply chain development programme activity that's already in place.

Moving on to the third programme, productivity, so this is obviously the very elusive challenges that not only Scotland but much of the Western world faces in terms of improving productivity. We recognise that on connectivity, infrastructure, digital adoption, we have made progress. But there is more to do to keep up with and have position in place where we can compete internationally, so a significant focus there. But also more broadly than that, round about business leadership and public sector leadership and how we address challenges there to be able to maximise best practice and process innovation to take forward business productivity. Also understanding the broader aspects of this round about community wealth building, social enterprises and other business models which have got a broader role in addressing business productivity. Again within this, a very significant focus on how that aligns with work [we're taking] forward across the regions of Scotland.

Number 4 is on skilled workforce. Again you've obviously had a session on this previously, so I don't need to repeat much of this. It's a very well-trodden path. It doesn't mean that there isn't still a significant amount of work to be done here to build on the strengths that we do have. Interestingly when you talk to inward investors, as you well know, one of the key reasons that they find Scotland very attractive is our very strong talent and skills pipeline, but we do recognise, of course, there is significantly more that we can and should do to further strengthen that.

Part of this is about the education system and the skills system being more agile and responsive to economic needs and more aligned with the other economic opportunities and economic direction, but a significant piece round about lifelong learning and investing in skills throughout what, of course, is becoming a more complex environment as careers change multiple times through an individual's working life. Also a programme on how do we increase the availability of labour, be that through addressing labour market inactivity in Scotland or looking at opportunities to attract talent to Scotland from the rest of the UK or further afield, recognising immigration challenges inherent with that given the current limitations on powers?

Finally the fifth programme round about a fairer and more equal society, understanding the role that the economy has to play in supporting individuals into well-paid work and helping to tackle the poverty challenges within Scotland so addressing a childcare challenge, addressing transport challenges. Housing challenges have already been mentioned in regards to Highlands and Islands. That is a key element within here as is addressing inequality within the labour market and addressing structural barriers and tackling low pay within the existing workforce and a target to get everybody in Scotland earning above the real living wage as a minimum and within the course of the next few years.

The final piece on section 6 is the culture of delivery which I've mentioned, so quite a significant focus on how [unclear] about tackling that. If you look at the next slide, there's a programme laid out there for - it's good because it covers all the bases but does it in the simplest way possible, which I think is the measure of an effective delivery governance mechanism. Rest assured we will be relentless in ensuring that actions are taken forward, measured and delivered to execute on actions within the plan.

Then the final slide, just summarising what's happening on the next stage is significant amount of engagement going on across groups like yourselves, across the regional dimensions of this, across the sectoral dimensions of this and with individual businesses and the National Economic Forum. It's coming up. It will focus, of course, on NSET. Looking for opportunities where there are actions we can take forward quickly to deliver whilst also understanding some of these are going to be fairly long multi-year programmes that will require quite robust and structured [unclear] delivery mechanisms to take them forward.

I'll stop there. But very keen to get your input and have the conversation and get your comments on what you've heard from me today but what you've read in the strategy itself. Thank you.

John Swinney:                                                                          

Thanks, Ivan. Right, we'll come to contributions from colleagues.

I'll come to Alistair Dodds first and please others indicate if you want to come in. Thank you. Alistair?

Alistair Dodds:        

Thanks, John. Thanks, Ivan, for a thorough introduction. Talked a lot about opportunity today. I think this just helps emphasise what a great opportunity we have going forward. I think the 10-year plan gives real focus to this.

I think there's probably a few things I'd like to say. I really like the emphasis round about innovation, entrepreneurship and productivity. I like the fair work and the zero references and the importance given to those. Stuart will probably come in and speak a little bit about that as well. I'm all for delivery. I'm all for accountability and responsibility and indeed implementation of plans and strategies. I think, as Ivan has said, this is going to be absolutely paramount in taking Scotland forward. However, I would ask that you [unclear] I think you've done this, Ivan, but continue to recognise the importance of Scotland's regions. The Highlands and Islands have got a great part to play in this going forward. I think the point I've made recently more than once is that Scotland doesn't stop at Perth. I think it's really important that we keep that in our heads going forward.

Again in relation to that regional effort, the Regional Economic Partnership I think again has a huge part to play in making sure that we've got a fit-for-purpose strategy for the Highlands and Islands going forward. In taking this and [unclear] talking about the REP, but collaboration and partnership is going to be paramount, whether that's - and this again comes back to the issue about accountability for implementing the plan. It's absolutely essential that we all work together. I'm talking there about the Scottish Government. I'm talking about local authorities. I'm talking about the other agencies on this call and not on this call. But I'm also talking about the private and public and third sectors, because unless we're all delivering on this, then it's going to be less successful. I think we need to keep that in mind. It also involves not just agencies, not just local authorities but the private sector as well.

One of the things which I'm not quite sure about, Ivan, is about where the public sector's guidance will come in future or come from in future. We've got a delivery board that's going to make people accountable or going to hold people accountable. Where will the guidance come from? Will it come from that delivery board or will it come from the Scottish Government ministers as it has in the past? Again I think it's really important, if you're talking about accountability, that that's quite clear going forward.

My last point you'll be pleased to hear is you've talked about taking things forward very quickly. Now there'll be all sorts of people with all sorts of wonderful ideas coming forward about how we should do that, both over the next 100 days, over the next six months and over the next 10 years. However, I can speak from HIE here. There are some really good people in HIE from Stuart Black right through the organisation. What I would ask is that you involve these people in setting up the structures and processes and different work strands as we go forward rather than just looking to new people or wonderful people that we've suddenly found. I don't think you've just suddenly found them, but they're out there. It's really important that people that know the region are also involved in setting up the delivery process.

That's my lot, but I'm really pleased to see this. I think it can give us a real focus. It picks up a lot of the things we've spoken about today. I really appreciate that, so thanks.

John Swinney:        

Thanks, Alistair. I'll come to Margaret Davidson and then Stuart Black. Margaret?

Margaret Davidson:

Thank you, John. Right, okay. I think the board for this has got to be accountable to the Regional Economic Partnerships. The Regional Economic Partnerships have got to be accountable to it. They've got to be talking all the time or else it won't happen properly.

Oh. Hello, Ivan. You're actually looking in the right place at the moment, because your head and your body were separate for most of your presentation. But don't let it worry you. The voice got through well.

But what I will commend is net zero being absolutely central to this, because every time I look at what we need to do to get to net zero - yes, we'll need investment to get some of it moving at all, but the opportunities are fantastic. They really are. [An early] place I wouldn't mind some real concentration going because, at the moment, we're doing a lot of research around it, but we're not - we've almost lost control about what's happening on the ground. That is landscape, using landscape as a carbon sink. At the moment, what is happening is, yes, we've got good research going on in the north and projects but not on the scale that we need them to be on.

What is happening is that private sector companies are coming into Highland, looking for carbon offsetting, making a deal with a big private estate. Nobody's involved in that. It's private money talking to private money and profit, once again leaving the Highlands without any strategic overview of what's happening here. This is happening increasingly across our landscape. The sooner we actually get our head around what is actually happening here, seeing what we can do to get some community wealth out of this in some way or other - apart from training guys to use JCBs, although that's a good start. We need a lot more of them. If we can pick places like that where we can make an immediate impact, then we'll begin to see some of the potential of this.

It's where I came in today. It's where I'll go out today. I'll move on to the next chapter. This is a time of extraordinary opportunity. I, too, have never seen anything like this in 27 years in public life, the opportunities that we have in front of us, not just for the Highlands and Islands, for Scotland. It is for us to make the best of this and to actually really focus on action and delivery.

John Swinney:        

Thanks, Margaret. Stuart Black and then I'll come to Mary MacInnes.

Stuart Black:

Yes. Thanks. Margaret just about said what I was going to say around the opportunity sectors. I think it's really good to see the opportunity sectors being flagged up in the strategy.

Just one point around fair work, Deputy First Minister, we're going to be the first agency in Scotland to introduce that as part of our funding criteria. From April 1, we'll be doing that. I think it's really important that the Highlands and Islands lead the country as a fair work region. That's something we're committed to. From April 1, we'll be doing that.

I think around net zero, we've got huge opportunities. I think Margaret was touching on them. We've found looking ahead there are two big opportunity sectors [unclear] hydrogen, particularly green hydrogen production. Graham Leadbitter already talked about the amount of energy coming into Moray. There's huge renewable energy resources off our coast that are being developed and we should be turning that into green hydrogen. That'll help fuel the economy going forward in a green and sustainable way. Offshore wind we've touched on already through ScotWind.

I think the other sector which could help with national transformation is the space sector. Of course, the launch facilities are all based in our region. We have three serious launch opportunities in the Highlands and Islands from Shetland to Sutherland to North Uist and, of course, also Machrihanish potentially with a different type of launch.

There are really great opportunity sectors here. I think [Alastair] made the point about collaboration. If we can get a shared vision for the region through the Regional Economic Partnership, I think that'll really help this. We'll have everybody working to the same goal.

I think lastly just around delivery, HIE is an agency which is all about delivery and making things happen. We definitely want to be involved in the design and delivery of the programmes, because I think it is important that people with experience are engaged in the design of these. That's an offer to the Minister. I know he's aware of that but really keen to work with you on delivering this, because it is a really important 10 years coming up, particularly in the run-up to the targets to get the 75 per cent reduction by 2030. That's eight years, so we've really got to do a lot of activity now. Thanks.

John Swinney:        

Thanks, Stuart. Mary MacInnes and then I'll come to Alex Gallagher. [Pause] We're not hearing you, Mary.

Mary MacInnes:      

Thank you, Deputy First Minister. Thank you to everyone who has given us such fantastic presentations today. Again it's just a plea to consider the Gaelic language. There hasn't been an opportunity just because of the nature of the business today, but the Gaelic language can be a transformational asset for the Highlands and Islands. The Highlands and Islands make a huge contribution to the Gaelic language, so it can certainly work both ways there. What we see with Gaelic development and promotion is when it's woven into plans from the start that it's much, much more effective. I would ask and urge people, as they are considering the hugely ambitious things that we have been talking of, that Gaelic is considered not as a bolt-on but at the heart and at the centre of all the work that you are doing. My thanks to you all indeed. Feasgar math. This is Seachdain na Gàidhlig. It's the first Gaelic week in the world this week. [Unclear].

John Swinney:                                                       

Thank you, Mary. Alex Gallagher and then Graham Leadbitter.

Alex Gallagher:       

Thanks, Deputy First Minister. Thanks, Minister, for the presentation. I don't have the strategy. It wasn't in my pack, so I haven't read the detail. I think the overview was very clear. I think it has got a good space and structure to it.

The one thing that I would ask, you did mention in passing community wealth building. Not sure if it should be more central to your strategy. Particularly in the regions that we're dealing with here in this forum here, it's all about pushing the profits of local activity and keeping them in the local areas. That's exactly what the regions in the Highlands and Islands and our islands should be doing. Economic growth in Scotland [unclear] to happen and it would be great. But it has to be, I think, more directed towards in particular North Ayrshire, for instance, which is one of the most fragile economies in Scotland, and the islands which are also fragile in different ways. I would like to have seen more of a focus on community wealth building as a driver of some of these parts of growth.

I'm also interested in your delivery culture. I'd be interested to see how you're going to deliver a delivery culture, because it's not an easy thing. Some people adopt it quite quickly and are natural deliverers. Some aren't. I think there is going to be a big communication or education load in there to make sure that we're all thinking the same thoughts and understanding the same meanings from the words that are in your presentation. Thank you.

John Swinney:        

Thanks, Alex. Lastly Graham Leadbitter and then we'll bring it to a close. Graham?

Graham Leadbitter:

Hi there. Yeah. Thanks for that, yeah. One of the things I wanted to pick up on was the focus on renewable energy and the hydrogen economy. That's going to be, as I've said earlier on, hugely important in Moray.

But one of the things I would maybe add into that mix is the grid management technology. The electricity grid is having to be almost redesigned to cope with the way that renewable energy interacts with it as opposed to the much more traditional power production methods which provide momentum just built into the systems that they use. A good example of that was last week. Michael Matheson was up last week in Moray to open a new - what essentially to most people would just look like a shed in the middle of a field. It's got £50 million worth of incredible technology. It's a pathfinder project. It's first of its kind in the world and it's designed to provide that momentum in the grid. Given that we're at the frontier of renewable energy in the whole of the UK, then that management of the grid will be right on our doorstep as well. There's huge opportunity there over and above the actual production of the energy but how to manage that energy and make sure that it's distributed in an effective and efficient way. Some amazing opportunities there.

Same with the food and drink. I would describe in Moray food and drink is almost manufacturing economy because of the nature of what we're producing. It is those 60 chemical factories that are producing malt whisky. Produce an amazing product, but it is chemical engineering at its heart. They are doing some really incredibly innovative things with how to produce the energy that they require to boil all of that liquid that they produce on a daily basis. They're huge energy users, but they have really, really tough targets that they're setting themselves to get to net zero. Even the Royal Air Force have set a target of 2035, which is quite incredible when you think about it and what they do. That means that they'll be looking to develop places like RAF Lossie or other defence assets to have perhaps solar farms and that kind of thing. There are some really, really huge opportunities around these areas that will feed really well into the plan. I'm really excited by the plan.

John Swinney:        

Thanks very much, Graham. Right. Ivan, do you want to respond to these points?

Ivan McKee:

Thanks very much, DFM. I'll briefly run through them. I've turned off my video so you don't have to witness my head and my body being disconnected anymore. Yeah, great points. Thanks very much for those.

Just to reiterate this, the relationship of the partnership between this strategy and the delivery mechanisms here and what's happening at a regional level is absolutely key to this, so getting that right is [central]. Rest assured we will be making sure that those connections are made and people are brought in, new people and people that are already there, Alistair, to make sure that we're making use of all the talents that are out there. Frankly if you feel that that is not happening and you're not part of that conversation, then don't hesitate to contact myself or Kate Forbes to make sure that we address that, because it's absolutely fundamental to being able to take this agenda forward and deliver on what's there.

Stuart, in terms of the different sectors you mentioned, yeah, you're absolutely right. The Highlands and Islands have got a tremendous amount to offer in energy and in space but also frankly, as has been mentioned as well, in the food and drink sector [and] innovation happening there in tourism and innovation happening there, the life sciences sector and others, which are fundamental to the economy and absolutely key to the strategy. I think as I said, as we did in the inward investment plan, understanding those core regional strengths and making sure we've got alignment there is really fundamental.

Margaret, the point about natural capital was well made. That is obviously included in the strategy. We address that quite prominently but also very much how we take that forward to be successful from an investment point of view but also the local benefits that flow from that. Again that is a key part of the strategy. If you feel there's more engagement needing to happen there to take it forward, then feel free to get in touch on that.

The importance of Gaelic, if you've been through the strategy, you'll recognise that it is included. The point is well made. Of course, with Kate Forbes driving this, there is no danger that the Gaelic language would be forgotten in this regard, so rest assured that is absolutely included.

Likewise on community wealth building, that is fairly key to the approach round about fairer prosperity, being able to deliver not just at a regional level but very, very much at a local level and the importance of community wealth building in the programmes that the Scottish Government's taking forward there [to be] an integral part of that. If you go through the full strategy - I don't know why it wasn't sent out. Officials can make sure that everybody that's on the call gets a copy of the strategy but also very importantly a copy of the analytics paper, the evidence paper that supports it, which has a real wealth of excellent information in there that really provides the analytical base as to why we ended up with the decisions and the conclusions and the actions and the programmes that we have in the strategy. That's a very key part of the document [unclear] as well.

I think I've covered pretty much all of the key points there, so back to yourself, DFM.

John Swinney:        

Thanks very much, Ivan. Thank you to colleagues for your contributions. That's us getting to the last part of our discussion today, which is to look at outcomes. I'm not sure if my team are in a position to put up any of the outcomes from earlier on. Do we have that available?

Laura-Anne Brown:

No, Deputy First Minister. We've got outcomes loaded for the first four agenda items, but we don't have one obviously for the discussion that's just taken place.

John Swinney:        

Just put up the first - just work our way through them, LauraAnne. We can follow up on Mr McKee's presentation later.

Laura-Anne Brown:                          

Okay, that's perfect.

John Swinney:                                        

Okay, so if we put up the first one, please.

Okay, can we - there we are, on the Regional Economic Partnership. CoHI members welcomed the establishment of the Highlands and Islands Regional Economic Partnership which will coordinate actions on strategic [cost-cutting] issues to drive the economy in Highlands and Islands regions, such as its representation within NPF4, ensuring the region benefits fully from investments in renewable energy and the infrastructure supports the regions' economic priorities and opportunities. Members agree to close working between the Regional Economic Partnership and CoHI, facilitated by a standing agenda item on REP progress and priorities. Any observations on that? Margaret?

Margaret Davidson:

Yes, John. I'm not sure this is the place for it. There was some discussion about how the Regional Economic Partnership - all of us sitting there were disappointed about the prominence of the Highlands and Islands region within NPF4. We'd ask for a clear look at that. Now we'll be individually replying on that. The REP is also replying. We did mention it today and it is of such fundamental importance to us.

John Swinney:        

It's in there, Margaret, such is its representation within NPF4. We'll take forward those specific representations.

Margaret Davidson:


John Swinney:        

But I think the point's covered. Okay, any other observations? [Pause] No.

Okay, we'll move on to the second one which is on population. CoHI noted the update from the working group and Scottish Government on progress since the previous convention. Pace, ensuring that this population work joins up with and aligns with additional national and regional strategies - such as housing, connectivity and the work of REP - were highlighted as key priorities. CoHI requested an update from the Scottish Government, local authorities and agencies on progress made in regards to workforce dispersal at the autumn convention. I think we need to add in the things that the work needs to join up with also includes the word transport as well. If we could add that in please - any other comments? [Pause] Okay, we'll take that as okay.

We'll move on to the third outcome which is on transport. CoHI asked the transport authorities [unclear] to work collaboratively and at pace with all relevant organisations and government to make the most of the existing public transport. Also consideration development of the more innovative solutions which deliver the aims of NTS2, NSET and the regional transport strategies. A further transport item will be considered at the autumn CoHI with partners to highlight the topics they wish to see discussed, which transport authorities can then collaboratively consider for the next meeting with a focus on short-term implementable actions where possible. Transport Scotland to consider tangible short-term solutions to transport challenges in the region for the autumn CoHI meeting where potential options will be considered in partnership with stakeholders. Alex Gallagher?

Alex Gallagher:       

Yeah. I've been a member of this committee now for six years and I think we've only discussed transport twice [unclear] as an item. One of the things that we did talk about at this [issue] today was that transport should be split into smaller bite-sized pieces and be on the agenda more often. I think that's worth carrying forward.

John Swinney:        

Okey-doke. We can reflect that in the outcomes. Anybody else? [Pause] Okay, that's grand. We'll take that one as read.

Outcome 4 on labour market. Convention recognises the progress made since the last CoHI meeting by partners [unclear] respond to the labour market impacts of the pandemic and activity to support individuals and employers [to] benefit from future opportunities and agrees to support partners in taking forward the following next steps. Continue to gather and disseminate evidence and insight, including a direct engagement with employers on skills shortages. Driving further skills and repopulation activity through its subgroups to grow the working age population. Aligning investment and skills behind opportunities, both current opportunities as identified in this report and new ones as they emerge. Funding and developing a balanced portfolio of provision between the best of academic pathways, workplace training, upskilling and reskilling. The importance of communicating a positive message of the opportunities a region affords is vital. Any comments on that? [Pause] Okay, that's grand.

I'm not sure if we've got the last one. Lisa?

Lisa McDonald:

DFM, I've got a draft outcome I can put in the chat if helpful.

John Swinney:                                                      

Yeah, just - I think I've maybe got that in front of me actually.

The convention welcomes the positive alignment between the work of the Regional Economic Partnership and the National Strategy for Economic Transformation with a shared focus on wellbeing in our economy, communities and environment and acknowledges the key role that REP can play in delivering the strategies to maximise the opportunities for the Highlands and Islands region and welcomes a report on delivery progress at the next convention. I've just read that out, so people haven't had a chance to look at that. But I think in general it sums up where we've got to. But as with all these outcomes, they can be the subject of dialogue and discussion afterwards to get them to a point of agreement. Okay. Is that okay with folks? [Pause] I'm not hearing any demurring.

Okay, so thank you all. That gets us to the close of the meeting. Thank you very much for all your contributions. I'm very anxious that we maintain the dialogue outwith the Convention of the Highlands and Islands on the issues that we've talked about today, a number of very significant issues and specifically on economic priorities. The benefit of the convention is that it brings together the opinions and views of a range of public bodies into a combined and purposeful agenda to take forward practical propositions. That work will carry on in the aftermath of the convention and help us in preparing for the next convention on Monday 3 October 2022, which I do hope is a face-to-face gathering somewhere in the Highlands and Islands. There'll be a lot of work going on in the interim to get us ready to continue that agenda.

I'm conscious that this is the last meeting of the convention before the local authority elections in May. I've not caught up with everybody's plans and intentions, but I do hear courtesy of The Press and Journal that Margaret Davidson has decided that enough is enough as they say. I just want to record my personal appreciation to Margaret for her [unclear] public service and her leadership of Highland Council. It's been a pleasure, Margaret, as always to deal with you on all manner of issues. I'm not aware of other colleagues' intentions, so please don't take any discourtesy from the fact that I've not - it's not all reached me on the jungle drums. But to Margaret and to anyone else who's stepping down in May, my good wishes and thank you for your participation in CoHI over these years. Okay. Thank you all and we'll catch up...

[Over speaking]


Thank you. Bye. Bye.

John Swinney:                      

Thanks very much.

[Over speaking]


Thank you.


Thanks, John.

Margaret Davidson:

Bye-bye, John. Thank you [laughs].


Meeting Closed

Papers can be made available on request from the CoHI Secretariat mailbox.


Convention of the Highlands and Islands

CoHI Secretariat
Strategic Engagement and Co-Ordination Unit
5 Atlantic Quay
150 Broomielaw
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