Plans and discussions regarding restructuring/merger of Enterprise Agencies: FOI Review

Information requested

Original Request 202500472477

1. Restructuring or Reform of Enterprise Agencies
All minutes, papers, correspondence, or briefings (including drafts) since 1 January 2020 relating to any proposals, discussions, or decisions regarding:

• The merger, restructuring, rationalisation, or closure of any of the following: Highlands and Islands Enterprise (HIE)
• Scottish Enterprise (SE)
• South of Scotland Enterprise (SoSE)
• Any proposed change to the statutory mandate, governance model, or operational remit of the above agencies.

2. Overlap or Duplication
All internal or commissioned analysis, reports, or cost-benefit evaluations examining:

• Duplication or overlap between the three enterprise agencies
• Interactions or duplication with the Scottish Government's own National Delivery Bodies (e.g. Economic Strategy teams, NSET)
• Proposals to streamline, integrate, or consolidate delivery structures to improve efficiency or reduce cost

3. Ministerial Communications
Any communications (including emails, meeting notes, or correspondence) between Scottish Ministers (or their Special Advisers) and:

• Chairs, CEOs, or board members of HIE, SE, or SoSE
• Scottish Government Directors or senior civil servants

…relating to potential changes to the role, structure, or future of the enterprise agencies.

4. Board-Level or Executive-Level Escalation
Any minutes or briefings involving Cabinet Secretaries, the Permanent Secretary, or Director-General Economy where the future direction or restructuring of the enterprise agency landscape was discussed.

Response

have now completed my review of our response to your request of 22 July under the Freedom of Information (Scotland) Act 2002 (FOISA) (Ref. 202500472477) for –

1. Restructuring or Reform of Enterprise Agencies
All minutes, papers, correspondence, or briefings (including drafts) since 1 January 2020 relating to any proposals, discussions, or decisions regarding:

• The merger, restructuring, rationalisation, or closure of any of the following: Highlands and Islands Enterprise (HIE)
• Scottish Enterprise (SE)
• South of Scotland Enterprise (SoSE)
• Any proposed change to the statutory mandate, governance model, or operational remit of the above agencies.

2. Overlap or Duplication
All internal or commissioned analysis, reports, or cost-benefit evaluations examining:

• Duplication or overlap between the three enterprise agencies
• Interactions or duplication with the Scottish Government's own National Delivery Bodies (e.g. Economic Strategy teams, NSET)
• Proposals to streamline, integrate, or consolidate delivery structures to improve efficiency or reduce cost

3. Ministerial Communications
Any communications (including emails, meeting notes, or correspondence) between Scottish Ministers (or their Special Advisers) and:

• Chairs, CEOs, or board members of HIE, SE, or SoSE
• Scottish Government Directors or senior civil servants

…relating to potential changes to the role, structure, or future of the enterprise agencies.

4. Board-Level or Executive-Level Escalation
Any minutes or briefings involving Cabinet Secretaries, the Permanent Secretary, or Director-General Economy where the future direction or restructuring of the enterprise agency landscape was discussed.

In your request for review, you asked that the following points be addressed:

​​​​​​​Point 1. Failure to Provide Up-to-Date Material

​​​​​​​The documents disclosed all pre-date mid-2023, yet my request explicitly asked for materials from January 2020 to the present. The failure to include any material from late 2023 or 2024 is implausible and suggests either:

• A refusal to disclose relevant documents; or
• A failure to properly search for more recent materials.

​​​​​​​This omission is all the more striking given the publication of a major reform report by Future Economy Scotland in 2024, co-authored by Professor Mariana Mazzucato, who is known to have advised the Scottish Government directly. That report proposed a mission-oriented overhaul of Scotland’s economic development architecture — precisely the issue at the heart of this FOI.

​​​​​​​It is difficult to accept that no internal briefings, communications, or impact assessments followed its publication, especially given Mazzucato’s public association with Government policy circles.

​​​​​​​I request that any such post-June 2023 material — including correspondence, internal memos, options papers, Cabinet or official briefings, or engagement with Mazzucato/Future Economy Scotland — be identified and disclosed or justified if withheld.

​​​​​​​Point 2. Redactions in 'Options for PSR – May 2023'

​​​​​​​The document titled “Options for PSR – May 2023” was released in redacted form. The redactions appear to be made under Section 30(b)(ii) of FOISA (“free and frank exchange”), yet no clear or proportionate public interest test has been demonstrated in the decision notice.

​​​​​​​Given that this paper was already circulated within government in 2023, and the reform debate has progressed further in public discourse since, there is a strong case that the content should now be fully disclosed.

​​​​​​​If the redactions are to be maintained, I request a more detailed justification under FOISA, specifically:

• Why partial disclosure would inhibit future policy discussion;
• Why this harm outweighs the overwhelming public interest in transparency over economic development governance and reform.

Point 3. Inadequate Acknowledgement of Public Interest

​​​​​​​The Scottish Government’s response makes no attempt to weigh the public interest in disclosure — a requirement under Section 30 exemptions. This omission is unacceptable given the scale of public concern over:

• Duplication and cost inefficiency between HIE, SE, SoSE, Skills Development Scotland, and now the Scottish National Investment Bank (SNIB) and new digital or economic directorates;
• The introduction of additional economic development bodies or units, each with their own governance, payroll, and policy agendas;
• The fact that 1 in 4 Scottish children lives in poverty, while public bodies operate in silos with overlapping remits and little transparency about reform proposals.

Public confidence in Scotland’s economic governance framework is undermined when significant taxpayer-funded functions are subject to secrecy under the guise of internal candour. It is a matter of public interest — and democratic accountability — to know whether rationalisation or structural reform is being meaningfully considered.

​​​​​​​Point 4. Regional Considerations and HIE’s Current Role

​​​​​​​As noted in the public discourse and reporting, the economic context that justified the original Highlands and Islands Development Board (HIDB) has changed dramatically. Inverness is now among the fastest-growing regional economies in Europe, and the overlap of agencies in the region — SNIB, SE, HIE, Skills Scotand, NatureScot, Forestry and Land Scotland, Marine Scotland, Crown Estate Scotland, et al — creates significant duplication. The response from the Scottish Government contains no evidence of recent review or appraisal of whether HIE’s regional role is still appropriate, cost-effective, or justified This omission again fails to serve the public interest in assessing the efficient delivery of economic development outcomes.

I have concluded that the original decision should be confirmed, with modifications.

Please find below my response to each of the points raised:

Point 1: Failure to provide up-to-date material

I have reviewed the documents released and have identified 36 separate documents and while not all of these are dated, there are three documents from 2025 (documents 3, 18 and 20). I am therefore satisfied that the released information relates to the time period specified in your original request.

With regard to your specific reference to the report co-authored by Future Economy Scotland and Mariana Mazzucato and published in 2024, I can confirm that no documents relating to this report were identified in the original document search. I can also confirm that while the Scottish Government did not provide a response to that report, all the material held by the Scottish Government in relation to this report was released as part of a separate Freedom of Information request in November 2024. The response to that request can be found at https://www.gov.scot/publications/foi-202400435086/

I have also reviewed the document search for your original Freedom of Information request. I am satisfied that appropriate searches were carried out and that all relevant documents discovered as a result of those searches have been released. I have therefore concluded that, in line with good practice, the searches that were carried out were deemed to be the most effective way to identify the information being sought, according to the terms of the request.

Point 2. Redactions in 'Options for PSR – May 2023'

The document you refer to above (document 32) was released in unredacted form. However, I have reviewed all of the documents released in response to your initial request. I have concluded that some of the information that was originally withheld should be released and a revised version of that information is attached.

Where information remains withheld throughout the information disclosed, I have concluded that the following exemptions do apply and I have attempted to explain more fully the public interest test that has been undertaken.

An exemption under section 29(1)(a) of FOISA (formulation or development of government policy) applies to some of the information requested because it relates to the formulation of the Scottish Government’s policy relating to the future of the economic development landscape.

This exemption is subject to the ‘public interest test’ and I have found that, on balance, the public interest lies in favour of upholding the exemption in those cases. We recognise that there is a public interest in disclosing information as part of open, transparent and accountable government, and to inform public debate. However, there is a greater public interest in high quality policy and decision-making, and in the properly considered implementation and development of policies and decisions. This means that ministers and officials need to be able to consider all available options, and to debate those rigorously, to fully understand their possible implications. Their candour in doing so would be affected by their assessment of whether the discussions on the structure and nature of relevant economic development bodies and the wider environment would be disclosed in the near future, and it may undermine or constrain the Government’s view on that policy while it is still under discussion and development. Some of the withheld information relates to policy deliberations at the very earliest stages of consideration where the inhibitory effect of disclosing such information would create harm that outweighs the public interest in disclosing the discussion.

An exemption under section 29(1)(b) of FOISA (ministerial communications) also applies to some the information requested because it relates to communications between Scottish Ministers.

This exemption is also subject to the ‘public interest test’. I have found that, on balance, the public interest lies in favour of upholding the exemption in some cases. There is a greater public interest in allowing ministers a private space within which policy positions can be explored and refined until the Government as a whole can adopt a policy that is sound and likely to be effective. This private thinking space also allows for all options to be properly considered and good policy decisions to be taken. Premature disclosure is likely to undermine the full and frank discussion of issues between ministers, which in turn will

undermine the quality of the policy making process.

In other instances, I have concluded that the information should remain withheld because an exemption under section 30(b)(i) of FOISA (free and frank provision of advice) applies This exemption recognises the need for officials to have a private space within which to provide free and frank advice to ministers and to other Scottish Government officials before the Scottish Government reaches a settled public view. Taking account of all the circumstances, I have found the public interest lies in favour of upholding this exemptions in some cases. Disclosing the content of free and frank advice on the future of the economic development landscape would substantially inhibit the provision of such advice, particularly because these discussions are still ongoing and decisions have not been taken.

In a smaller number of instances, I have also found that information should remain withheld under Section 30(b)(ii) of FOISA (free and frank exchange of views). This exemption applies because disclosure would, or would be likely to, inhibit substantially the free and frank exchange of views for the purposes of deliberation. This exemption recognises the need for ministers and officials to have a private space within which to discuss issues and options with external stakeholders before the Scottish Government reaches a settled public view. Again, disclosing the content of these discussions with the enterprise agencies and others on the future of the economic development landscape will substantially inhibit such discussions in the future, because these stakeholders will be reluctant to provide their views fully and frankly if they believe that those views are likely to be made public, particularly while these discussions are still ongoing and decisions have not been taken, and, in some instances, these discussions relate to a sensitive or controversial issue such as staffing.

Taking account of all the circumstances of this case, I have considered if the public interest in disclosing the information outweighs the public interest in applying the exemption. I have found that, again, on balance, the public interest lies in favour of upholding the exemption in some cases. In several aspects of the withheld information, there is a substantial risk that it could significantly affect the relationships between ministers and their NDPBs, as well as negatively impact on operational delivery, if officials in those organisations felt that they could not be fully open and honest with ministers. This, in turn, could undermine the quality of the policy making process, which would not be in the public interest. Again, private thinking space is essential to enable all options to be properly considered, based on the best available advice, so that good policy decisions can be taken.

Elsewhere in the document, some names remain redacted under S38(1)(b) as they relate to junior officials or people who have left the organisation. Information relating to issues or organisations which are outside the scope of your request also remain withheld.

Point 3. Inadequate acknowledgement of public interest

This point has been dealt with under point 2 where the public interest tests that were applied have been more fully outlined.

Point 4. Regional considerations and HIE’s current role

As noted under point 1, I have reviewed both the documents that were released and the searches that were conducted to identify them and have concluded that all the relevant information held by the Scottish Government has been released, subject to the release of the additional information that had previously been withheld. Where additional searches may have been conducted, these are subject to the applicable upper cost limit.

About FOI

The Scottish Government is committed to publishing all information released in response to Freedom of Information requests. View all FOI responses at https://www.gov.scot/foi-responses.

FOI 202500476929 - Information Released - Annex

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