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Scottish Crown Estate Bill

Overview

The Scottish Crown Estate Bill sets the framework for the long-term management of the Crown Estate in Scotland. The Bill defines the management of Scottish Crown Estate assets. 

The Bill identifies:

who can become a manager of a Crown Estate asset
how management can be devolved within Scotland 
what the remit of the new managers could be

This gives managers‘ powers and duties for these assets, including: 

planning
reporting 
accounting

The Bill sets out how to change the management of the Scottish Crown Estate assets. 

You can find out more in the Explanatory Notes document that explains the Bill.

Why the Bill was created

The Crown Estate is a collection of property, rights and interests. It is owned by Her Majesty in right of the Crown. The Crown Estate Commissioners managed these assets under the Crown Estate Act 1961.

The Crown owns around half of the 18,000 km length of Scotland’s shoreline. Exceptions to this are land owned by a third party or land bought from the Crown by other landowners. 

The Crown has other property, rights and interests in Scotland. It is also a significant landowner in Scotland. 

Management of the Crown Estate in Scotland was devolved in 2017 and this Bill was created to make provision about that how it is to be managed.

You can find out more in the Policy Memorandum document that explains the Bill.

Where do laws come from?

The Scottish Parliament can make decisions about many things like:

  • agriculture and fisheries
  • education and training
  • environment
  • health and social services
  • housing
  • justice and policing
  • local government
  • some aspects of tax and social security

These are 'devolved matters'.

Laws that are decided by the Scottish Parliament come from:

Becomes an Act

This Bill passed by a vote of 119 to 0 and became an Act on 15 January 2019.

Introduced

The Scottish Government sends the Bill and related documents to the Parliament.

Scottish Crown Estate Bill as introduced

Related information from the Scottish Government on the Bill

Opinions on whether the Parliament has the power to make the law (Statements on Legislative Competence)

Information on the powers the Bill gives the Scottish Government and others (Delegated Powers Memorandum)

Scottish Parliament research on the Bill 

Stage 1 - General principles

Committees examine the Bill. Then MSPs vote on whether it should continue to Stage 2.

Have your say

The deadline for sharing your views on this Bill has passed. Read the views that were given.

Who examined the Bill

Each Bill is examined by a 'lead committee'. This is the committee that has the subject of the Bill in its remit.

It looks at everything to do with the Bill.

Other committees may look at certain parts of the Bill if it covers subjects they deal with.

Who spoke to the lead committee about the Bill

Video Thumbnail Preview PNG

First meeting transcript

The Convener

Agenda item 2 is evidence on the Scottish Crown Estate Bill at stage 1. In this first evidence session, we will hear from Scottish Government officials on the background to and content of the bill. I welcome David Mallon, who is the head of the Crown estate strategy unit of Marine Scotland; Mike Palmer, who is deputy director in the aquaculture, Crown estate, recreational fisheries, European maritime and fisheries fund and Europe division of Marine Scotland, which is quite a title; and Douglas Kerr, who is a solicitor in the Scottish Government’s legal directorate. Good morning, gentlemen.

Let us kick off by looking at the duties in section 7. How might those duties make a difference to how Crown Estate assets are managed?

David Mallon (Marine Scotland)

Good morning. I will kick off by outlining the Scottish ministers’ policy perspective on that. My legal colleague, Douglas Kerr, can add anything else that is worth saying.

The first thing to highlight is that the duty in section 7 is a reform of the duty in the Crown Estate Act 1961, which requires the manager to “maintain and enhance” the value of the estate

“and the return obtained from it, but with due regard to the requirements of good management.”

However, “good management” has never been defined. It has sometimes been interpreted as requiring good stewardship; at other times, it has been interpreted as having the ability to take account of other factors. There are examples of the Crown Estate Commissioners in the past, and Crown Estate Scotland currently, using that second interpretation at small scale, but the existing managers have always been wary about the legal vires of that. Therefore, in thinking about what the long-term framework for management of the Crown estate in Scotland should be, the Scottish ministers have wished to make it more explicit that wider factors—the economic, social and environmental benefits that can arise from decision making—can properly be taken into account. We expect that, through that more explicit ability, managers will be more encouraged and will be careful to take account of opportunities before final decisions are reached.

The Convener

I want to focus on the environmental wellbeing aspect, in particular. On the Crown Estate’s role in leasing the sea bed for activities, my interpretation is that it currently performs that duty with a view to generating income, but takes no account of the environmental impacts of, for example, salmon farming or offshore wind turbines. There has been contention about those on the east coast. How will that situation be different in the future? Will it be different at all?

David Mallon

The short answer to that is that we will have to wait to see how managers will use the new discretion. The existing decision making by managers of Crown Estate assets sits within the wider context of Government licensing of activities: a fair amount of environmental assessment already takes place before any activity can happen in the sea. A Crown Estate lease provides the ability for an actor to secure exclusive use of a space, but I think that, with the new duties, over time the spotlight will increasingly be placed on the environmental, social and wider economic consequences, rather than on the more narrow return that can be obtained from the lease by the Crown Estate.

09:45  



The Convener

I welcome the addition of environmental wellbeing, but I am trying to understand what purpose it will serve and what difference it will make. At the moment, we rely on Marine Scotland, Scottish Natural Heritage and others to consider the environmental impacts of such activities. What specific duty would be placed on the Crown Estate?

David Mallon

We have to look at section 7 in the context of section 11, which is about transactions such as sales and leasing, which are market considerations that have, until now for the Crown Estate, focused on profit maximisation. Section 11 contains reforms that open the possibility of wider factors being taken into account. Section 7 can be viewed as showing that the Scottish ministers wish to see wider consideration of social, environmental and economic factors across the whole range of Crown Estate activity. Without section 7, transactions would rely only on section 11 rather than on the ethos of the organisation’s whole operation.

The Convener

Do you envisage that the Crown Estate may in the future engage with other agencies to see whether there are environmental concerns—for example, before it enters in to an arrangement to allow a lease of sea bed?

David Mallon

To be fair to Crown Estate Scotland, I say that such discussion already happens. The decision making to which the convener referred is in the context of the national marine plan, which gives direction to all consenters, including Crown Estate Scotland or future managers of Crown Estate assets. Over and above that, it should provide even more explicit requirements for a manager to look up front at the extent to which such wider factors—not just the return to the Scottish Crown Estate—should play out.

The Convener

Mike Palmer may wish to come in on that point. How do you see that interaction?

Mike Palmer (Marine Scotland)

The extra duties and powers that will be placed on local managers are part of an overall balance that the Scottish ministers wish to develop in the management of the Scottish Crown estate. The ethos encourages greater and stronger local stewardship of assets and greater community empowerment. The Scottish ministers also wish to ensure that, alongside those, due consideration is given to the wider societal benefits that local managers should pursue and seek to achieve. The ethos that has been pursued by the Crown Estate Commissioners has been very commercial, up to now. The Scottish ministers seek to broaden that as part of a trade-off that includes local empowerment and letting some national management go to the local level.

John Scott (Ayr) (Con)

Good morning. If the machine that has, in essence, produced yield on assets moves to the new ethos, there will be a loss of focus on that objective. Do you expect the change in direction to reduce the yield on assets? If so, how much of a reduction do you expect, given the tightness of the Scottish budget?

Mike Palmer

The bill includes a primary duty to increase the value of the assets.

John Scott

How will you measure value?

Mike Palmer

The bill refers to seeking to achieve “market value”—a clearly understood term that is defined in the commercial world, as a concept—except in certain circumstances, which are also defined in the bill. Local managers would have a primary duty to obtain market value and, thereby, to increase the value of the overall assets, so that focus is not being lost in any way. However, in the view of the Scottish ministers, a balance must be struck between that and social and environmental considerations, without sight being lost of either.

John Scott

I want to pin you down on this. Do you expect the yield from the assets to reduce as a result of the new focus?

Mike Palmer

Our expectation is that the yield from the Crown Estate’s overall assets will rise, which will also benefit Scotland. The Scottish ministers’ intentions are that, across all the elements—the economic, the environmental and the social spheres—benefit should accrue to Scotland from how Crown Estate assets in Scotland are managed. Ministers do not want to lose sight of that financial benefit, which goes alongside the other benefits: they expect the overall yield to be protected and for it to rise.

The Convener

I presume that some of the overall yield will not go to the Scottish ministers, but to local authorities.

Mike Palmer

The commitment has been made that part of the yield from assets will go to local authorities.

Mark Ruskell (Mid Scotland and Fife) (Green)

How will the new objectives on environmental and social wellbeing change the relationship with the regulators? For example, the Scottish Environment Protection Agency is undertaking a sectoral review of salmon farming and will introduce new regulations. My impression is that Crown Estate Scotland has been only loosely involved in that process. Do you see a different, perhaps tighter, relationship developing with the regulator?

David Mallon

I have lots of discussions with Crown Estate Scotland and with regulators. My sense is that a lot of dialogue takes place. A partnership approach is taken by the public sector in Scotland to many activities. New discussions might take place around the margins, but I think that the relationships already exist.

Mark Ruskell

My point is that we have not seen Crown Estate Scotland embedded in some processes—in particular, those on regulatory reform. Do you expect that to change? Is Crown Estate Scotland’s current level of engagement—with, for example, SEPA, on salmon farming—adequate, or do you expect that engagement will increase as a result of the new objectives?

David Mallon

As I have said, Crown Estate Scotland is already involved in a lot of initiatives. Engagement could increase. People understand that Crown Estate Scotland is an interim manager, so they might be involved directly in discussions.

The change that we can anticipate through implementation of the bill is that there would be more managers and that more one-to-one discussions could be had with the regulators. As Mike Palmer said, there is a wish to balance local discretion with a national framework. We see the strategic plan as a means by which strategic intentions can be outlined, and by which regulators can efficiently have that dialogue with managers of Crown Estate assets in Scotland. Over and above that, there may be specific initiatives in which managers could get involved.

We have to wait and see. It is difficult: there is no blueprint of what the future will look like because there is not yet full knowledge about local ambitions for management of Crown Estate assets. Everyone would like to see managers of Scottish Crown Estate assets being involved in those types of discussions. We are starting from a good foundation; the question is how much more will be needed as the changes play out.

Alex Rowley (Mid Scotland and Fife) (Lab)

A point was made about the new discretion in relation to social good and environmental good. Where will the final decisions on social good and environmental good be made? The convener gave the example of salmon farming. If Shetland Islands Council, for example, has control over waters, and decides on environmental grounds not to accept an application for a salmon farm, will that be the final decision or could the operator lobby the Scottish ministers? Where will the power lie? Will it be devolved to local managers or will there be a process by which their decisions could be overruled?

David Mallon

The power will lie with the managers of assets, who must have regard to the duty and can use discretion. They will have to be able to defend their decisions. The decisions will not be taken in isolation, but will sit within the wider context of Scotland’s regulatory framework, including the framework that governs the environmental context for decision making—the national marine plan, in the example that Alex Rowley used. There will also be the strategic plan, which is provided for in the bill, for the wider and longer-term approach to management of assets. That should set the context for managers, who must have regard to the strategic plan. There will be local discretion—but within a decision-making context that is provided for in the wider regulatory framework, and in policies and legislation other than the bill.

Mike Palmer

On where power will lie, the bill is drafted in such a way as to give ministers the discretion to decide case by case whether a transfer should be made to a local manager. There will be a very careful process of consultation and scrutiny of people’s proposals on how they wish to manage an asset. That process will be undertaken before any decision to transfer to a local manager. There will be checks and balances to ensure that, case by case, considered decisions are taken by the Scottish ministers before a transfer.

The Convener

I want to go back to Mike Palmer’s answer to John Scott about what is envisaged in terms of income generation. In the financial memorandum, there is speculation on the range of possible financial costs to the Scottish Government. It suggests that there is potential—I stress “potential”—for a drop in income from local authority ports and from non-operational ports and jetties. It speculates that the range would be “zero to medium”, which over a five-year period could be anywhere between £2 million and £10 million. There appears to be anticipation of the possibility of a drop in revenue from one aspect of current income. Given that, do you still hold to the view that, overall, there will be an increase in income?

10:00  



Mike Palmer

I think that the Scottish ministers envisage that there is a substantial opportunity for the overall value of the estate to rise. Some elements of the estate might not be expected to return as much in the short or medium terms as other elements, but there are other opportunities—offshore in the marine environment, for example—about which it is felt that the likelihood is quite high that revenues from the estate will increase quite significantly. Clearly we cannot guarantee that or know exactly what will pan out in the future, but those are the current indications.

The Convener

One obvious opportunity is offshore wind, but that depends on the United Kingdom Government’s attitude to financial support. John Scott wants to come in.

John Scott

I am intrigued by the concept that income will fall in some areas and that, as a result, other areas will have to work harder and provide more income. Would you care to be more specific about that? Are we talking about rents from properties—farm rents, or whatever? In which areas is income expected to rise, given that income from other areas is expected to fall?

Mike Palmer

I will defer to David Mallon on the detail—

John Scott

I think that you should answer the question, given that you made the statement.

Mike Palmer

I guess that it is almost a statement of fact that some assets might in any one year be expected to deliver more revenue than others. It is not possible to predict that with total accuracy from one year to the next, and it is often dependent on the wider economic context within which one is managing the estate.

John Scott

Forgive me for asking such a blunt question, but do you have a business plan for developing the project?

Mike Palmer

Yes. The current national manager, Crown Estate Scotland (Interim Management), has a business plan and a forward strategy for managing the estate. Clearly, as we move towards the legislation and into a period when there will be the potential to transfer down to a local level, the overall dynamic of the management of the assets will change, and we will be looking at individual business plans and strategies drawn up by local managers. At the moment, however, a national planning regime is in place.

David Mallon

I think that Mike Palmer was looking at both dimensions: first, the more narrow return to the Crown Estate Scotland from a transaction; and, secondly, what might be called a national accounting framework. As far as a manager’s duties are concerned, the default would be a commercial approach unless they could demonstrate that it was expected that wider benefits would accrue. Where those benefits would accrue, it would be tolerable in a national sense to experience a reduction in that income. Even though the fiscal framework and accounting might result in an overall reduction to the Scottish block, the reduction in the revenue or capital obtained would be expected to be accompanied by wider benefits accruing to Scotland as a whole. As a whole, therefore, the position should be neutral, at least, or favourable.

I should also add that the scenarios contained in the financial memorandum range from no change—which could be how managers choose to run and manage the assets—to a maximum position of no charge and zero revenue equivalent to what is obtained at present.

The truth probably lies somewhere in between, but until managers have the ability to follow their own local priorities, in that national context, precise changes in the existing income level will be quite difficult to predict.

John Scott

Have projections been made, or not?

David Mallon

Through our work on the business and regulatory impact assessment for the consultation paper and, building on that, through the financial memorandum, we have looked at the potential consequences over the next five years and at the various scenarios. Underlying that are some assumptions and quite a lot of work that we have done with our finance colleagues, our economists and stakeholders.

John Scott

Thank you very much.

The Convener

Donald Cameron has a question.

Donald Cameron (Highlands and Islands) (Con)

I refer the committee to my entry in the register of members’ interests, in that I am a landowner.

I want to be clear about this. When we talk about management of an asset, to what extent does revenue accrue to the manager and to what extent does it remain with the Crown Estate?

David Mallon

I will try to cover that point, although I ask my fellow witnesses to add to my comments if I miss anything. The manager is responsible for the management of that asset and will receive the gross revenue that is generated from it. The costs associated with management of the asset will be paid from that gross revenue by the manager. If there is a surplus at the end of the year, it is required to be paid into the Scottish consolidated fund.

Donald Cameron

Let me give a hypothetical situation of a wind farm on one of the Crown Estate’s estates and perhaps both the local community council and the local authority want to be the manager, and a significant net income is involved. How would that situation be resolved? Does the bill put in place a framework for the resolution of such disputes?

David Mallon

Correct me if I am wrong, but I think that the dispute that you mention relates to who should be the manager—the community or the local authority. In such a situation it is not impossible to foresee some difference of opinion. The Scottish ministers hope that, through following due process for the implementation of the bill, such issues might be resolved at an early stage. As part of the implementation plan, rather than just awaiting ad hoc proposals from individual organisations, the Scottish ministers are contemplating the value of a phased approach and a process that might involve seeking views from communities and local authorities over and above those that, to date, have expressed views on their ambitions to manage assets. A considered view might then be taken as to who, in any one circumstance, is best placed to take on management responsibility. Once that issue is decided, there will be duties that will apply to managers, relating to, for example, the production of a management plan to outline intentions on how assets will be managed, proposed sales and so on. At a practical level, I expect a manager to receive a lot of contributions on what should be in the plan, so that there is, at a second level, the ability to manage potential differences in opinion among parties.

The Convener

Thank you. Let us move on. Kate Forbes has a question.

Kate Forbes (Skye, Lochaber and Badenoch) (SNP)

I will continue with the theme of revenue generation. In 2015, the First Minister stated that coastal and island communities

“will benefit from 100 per cent of the net revenue generated in their area from activities within 12 miles of the shore”.

You may have touched on this earlier, but what is the current thinking on arrangements for distribution to coastal and island councils of net revenue from marine assets out to 12 nautical miles?

David Mallon

We are in discussion with the Convention of Scottish Local Authorities about the mechanics of implementing that commitment. The starting point is that, as we speak, and although the devolution of the management has been secured, we do not yet have a set of audited accounts for Scotland, let alone for the assets at a more local level. That set of accounts will be available only at the end of this financial year. Once it is produced and finalised by Crown Estate Scotland and audited by the Auditor General, that will provide the reference point for what the net revenue is. In our discussions with COSLA, we have been looking at a way in which there can be an allocation to individual local authorities based on that amount, probably on an interim basis, given that that will be the first set of accounts.

Kate Forbes

Presumably, based on your earlier answer to Donald Cameron, that revenue would go directly to coastal and island councils only if the local authority was the manager.

David Mallon

Not in the initial phase, because Crown Estate Scotland has been the manager for the past year. In a broader sense, that commitment recognised the point that has been made that some benefit should accrue from the presence of those activities taking place on assets adjacent to the population concerned. Ministers have so far sought to draw a distinction between management and revenue, so that we do not have to wait until the question of management is settled before local communities can benefit from the revenue that has been generated.

Kate Forbes

Is it the case that, irrespective of who is the manager, coastal councils will benefit from 100 per cent of the net revenue?

David Mallon

Yes, in a sense, but I would like to rephrase that slightly, if that is all right. Irrespective of who is the manager, we want coastal communities to benefit, and the interim arrangements would go through the local authorities. As management changes and we perhaps have a mix of community organisations and local authorities, the unanswered question is whether it is correct that local authorities should be the only beneficiaries of that income as the whole system develops, or whether there is a need to reappraise the way in which the money ultimately reaches a community.

Kate Forbes

Where there are councils—Highland Council, for example—that have some islands but a lot of area that is landlocked, would the net revenue go directly to the council, and would there be any stipulation that it is to return to communities that are actually on the coast?

David Mallon

Another strand to the dialogue with COSLA concerns the extent to which it will be an allocation without any description of what its purpose is, or whether there will be some guidance on how it should be used. Sometimes there is ring fencing around local authority funding. It is unlikely that ring fencing will be the favoured option, but dialogue is happening and there may be some communication by ministers when the award is given as to the overall purpose of that money. Those discussions have not yet concluded.

Mark Ruskell

What motivation will there be for organisations to become managers, given that 91 per cent of the revenue will go to the Scottish consolidated fund, although there will obviously be different arrangements for local authorities? To pick up on Donald Cameron’s example of a community wanting to become the manager of a wind farm, there would be some profit there, but most of the revenue profit would go elsewhere. How will the arrangements that you are setting out in the bill affect that motivation, when managers are not able to invest their full profits back into the assets?

10:15  



David Mallon

The finances are an interesting and complex set of issues to work through. You are referring to the 9 per cent that the existing manager can at present retain for reinvestment in the estate. Even if the figure remains at 9 per cent—with the ability to vary that in future—although 91 per cent will go into the Scottish consolidated fund, as is the case for Crown Estate Scotland, that amount for reinvestment would not be an insignificant sum for a local community that was managing an asset that is perhaps underutilised at present. Although there is a focus on national management, a community might have ideas on how a local asset could be managed differently but might not have the ability to do that. Even 9 per cent could be a game changer if it is directed at that specific activity rather than across the estate.

Over and above that, in my dialogue with stakeholders and in the stakeholder advisory group, which is convened by the cabinet secretary, and through the consultation responses, the theme of local control has been, I would say, stronger than that of revenue. Also, as I just said in relation to the question on revenue, there is potentially the ability to go beyond the 9 per cent that can be retained before money is paid into the Scottish consolidated fund, through decision making on what happens once the money reaches the consolidated fund. As a starting point, the issue is as much about control as it is about the revenue that can be generated. However, the revenue may not be insignificant, even at 9 per cent, although it could be more.

Mark Ruskell

I hear that but, in managing a wind farm, for example, there is a huge amount of sweat equity involved. How was that 9 per cent figure arrived at?

David Mallon

That is a carryover and a continuation of the long-standing arrangements that the Crown Estate Commissioners agreed with the Treasury. Through discussion with Crown Estate Scotland (Interim Management), that was thought to be the appropriate requirement moving forward. The bill will enable that 9 per cent to be varied, primarily depending on need for reinvestment, such as capital investment, in the estate.

Mark Ruskell

So it is an historical figure.

David Mallon

Yes.

Mark Ruskell

It does not reflect the new arrangements, in which there will be a more diverse base of managers.

David Mallon

That is correct, but the bill provides the ability to take account of the requirements of an individual manager.

Finlay Carson (Galloway and West Dumfries) (Con)

My primary question about the 9 per cent figure has been answered. There is potential for multiple managers to be identified across Scotland. We have a lot of coastal councils. What process will there be for deciding who the most appropriate manager is? Even in my constituency of Galloway and West Dumfries, we could have the local authority as well as multiple community organisations wanting to take over harbours or have a share in the community benefit that could be derived from managing wind turbines in their patch. How will that process play out? Will there be a bidding process?

How will you address the potential for conflicts of interest, given that local authorities will potentially take 100 per cent of the income generated but will also be the planning authority or the authority that looks after environmental health?

David Mallon

To take the last point first, in other settings, local authorities have to manage those conflicts of interest, and they have experience of putting in place systems that are designed to avoid such conflicts coming into play.

On how a manager will be decided, as I said, one option would be for the Scottish ministers just to await proposals or requests from individual parties, with the expectation that there could be a variety of proposals for the same asset. Another option, as I mentioned earlier, is for ministers to attach a process to that.

The Scottish ministers’ view is that, whoever becomes a manager, it would have to be as a result of an inclusive process, in which the existing manager and others who will be doing business with the new manager are involved and consulted, and come to a view on an appropriate arrangement. As I said, ministers are contemplating having a process whereby parties can make a request, which would have to demonstrate that a proposal is of benefit and that the required capability exists. In the consultation that the Scottish ministers conducted last year, I think that 86 per cent of respondents to the question said that councils or community organisations should demonstrate their capability.

Proposals that come forward will need to be looked at carefully to ensure that the arrangements are appropriate. Even if the council or community organisation has a good stake, good knowledge and, in principle, a good reason to take on management of an asset, there is a need for a smooth transition through any change and for a service to continue to be delivered to tenants, industry bodies and companies that depend on that service.

Finlay Carson

At the moment, it could be said that the Crown Estate wind farms are all managed by one or two people; there is one person who looks after the coastal areas. Following this bill, there could be multiple managers. Would the income generated by the whole of Scotland be reduced because there would be far more management involved than there is at the moment?

David Mallon

I will try to answer the different strands to that question. There will need to be a final decision on whether it is appropriate to devolve that particular activity further. Even if it is—which is a fairly open question, as no final decision has been taken—and there is more than one manager, the bill provides for a strategic plan for the management of the assets, and therefore a strategic overview. There is also the national marine plan.

As outlined in the financial memorandum, there is the possibility that there could be increased costs associated with administration. However, there could be increased opportunities such as new revenue from a manager managing assets commercially that have not been managed commercially before. There is the possibility of increased costs—primarily one-off changes—such as some additional administration costs and some additional transaction costs for operators in the industry that have to deal with more than the one or two people whom they deal with at present. We hope that those transaction costs would be reduced based on the ability of the industry to engage primarily at the strategic-plan level.

Finlay Carson

Do you foresee a situation in which, if the income generated is not greater, one manager would be retained for all the wind farm interests that the Crown Estate has at the moment, and that management of wind farms would not be devolved to local authorities or community group organisations?

David Mallon

It is not possible to rule out that ministers might have concerns about the costs involved. There might be other ways in which the end could be achieved, such as some form of local decision making through support, administration or involvement by the local community. Ministers want the bill to make it possible to change who manages the assets at present, through the two processes that exist. The Smith commission recommended that further devolution opportunities should be considered. Ministers want the bill to enable that process to happen, but also for the bill to be a tailored approach to local circumstances, which takes account of the wider asset base as well.

John Scott

Forgive me for this question; I probably have not read enough on the subject. If 100 per cent of the net income from fish farming or wind farms is to be given to local authorities or community bodies, will the same amount be deducted from councils’ overall annual budget settlements from the Scottish Government, or will those net incomes be in addition to councils’ annual settlements? That might be a binary question; forgive me for not knowing the answer.

David Mallon

At present, the intention is not to deduct an equivalent amount from general local government budgets, but I think that we will have to—

John Scott

It will be in addition, then.

David Mallon

It will be in addition. That is the current proposal, but no final decision has been made.

The Convener

Does not that potentially create a conflict of interest for a local authority when it comes to make a decision about consent for, say, a salmon farm? The local authority must weigh up the environmental impacts, for example, but its decision could generate income for it.

David Mallon

I see the link as quite indirect, given the mechanics of the Scotland Act 2016, which requires the revenue to be paid into the Scottish consolidated fund. The discussions about how allocations are made to local authorities will probably, in the absence of our being able to pinpoint how much each asset is making, naturally mean—although the system is not designed in this way—that the decision on a particular asset for a particular purpose will be a few steps removed from the issue of how much is received at the end of the financial year.

The Convener

My point is about the principle.

Mike Palmer

If I might refer to something that David Mallon said earlier, we are conscious that local authorities already have to make a wide range of decisions that potentially draw them into conflicts of interest. Local authorities have rigorous governance arrangements in place to ensure that there are checks and balances in the internal systems that they run, so that their decisions are proper, objective and not unduly coloured by conflicts of interest. We expect the local governance arrangements in local authorities to be rigorous enough to enable authorities to make the decisions that we are talking about.

The Convener

I am not suggesting that local authorities would necessarily act in a certain way. However, they could be open to allegations about conflict of interest from people who oppose projects. I am thinking about how we safeguard local authorities from allegations or accusations in that regard.

Mike Palmer

Indeed. I think that the Scottish ministers recognise that. It is worth repeating David Mallon’s point about the indirect way in which the money will flow and the methodology that we envisage using for redistributing the money—we do not envisage it being tied to individual income that is received from, say, a fish farm. I think that that will create sufficient distance to reassure detractors that there is no perceived conflict of interest.

The Convener

We will explore the issue more as we go through the evidence-gathering process.

Alex Rowley

We have mentioned the potential for increased administration costs. In relation to the proposed reporting arrangements, the bill provides for the setting up of a new Scottish public body and for mechanisms such as the preparation of a strategic plan, which will be laid before the Parliament, and the preparation—by managers of assets—of annual reports and management plans, which will also be laid before the Parliament. The bill also provides for a framework to transfer and delegate management to a number of different types of manager.

With all that, is there not potential for establishing what could become a complex set of management arrangements? In terms of the reporting requirements for ministers, Crown Estate Scotland and asset managers, is there a balance between the level of bureaucracy and the ability to innovate with new ideas and developments? After all, what is this all about and what change will it bring? I assume that that ability is behind the thinking for making the devolution changes, so is there a balance between allowing local managers to innovate and keeping control of the estate as a whole?

10:30  



David Mallon

There is, very much so. There is a balance to be struck between local discretion and accountability, and, along with accountability, consistency around Scotland where there is value in having consistency. The bill’s provisions seek to ensure that there is a balanced approach.

When it comes to the costs, ministers view it necessary that a set of accounts is produced for transparency and accountability purposes. That is also because the assets remain under the ownership of the Crown, and decisions on how to obtain revenue from the assets could potentially have an impact on the overall Scottish block. From those perspectives, it was thought important to have that accounting framework. On the cost, Crown Estate Scotland (Interim Management) is required at present to produce accounts and a plan, and we see the cost as being broadly equivalent to that.

There is the possibility of some increased costs as a result of the change in management process. Ministers have overseen the process by which the new interim body was established; it involved the establishment of a new set of systems, staff transfers and so on, and that experience will assist when it comes to making further change in a way that is sensitive and takes account of staff welfare.

We are probably in a different scenario from that recent change, in that the way in which the devolution was done resulted in the need for the Scottish ministers, Crown Estate Scotland and Crown Estate Commissioners to establish brand new systems, because there was no willingness for shared services on a wider United Kingdom basis. Those systems were created and they have been designed to run the assets in Scotland. Therefore, further change at an operational level could be expected to require adaptation of the systems rather than brand new systems or, in the case of, say, a local authority, the adaptation of its own system. The costs are likely to be significantly lower than the initial costs of setting up Crown Estate Scotland (Interim Management).

John Scott

I want to discuss the difference between the transfer of powers under section 3 and the delegation of powers under sections 4 and 5. What is the rationale for the two different means of devolving management powers?

David Mallon

Ministers’ basic approach is to have more than one tool in the toolbox—it is horses for courses. The transfer process would result in a permanent change, whereas the delegation process is required to have a timescale that could be quite long term, although there is the ability to complete the process on a shorter-term basis.

More fundamentally, the result of a transfer would be the end of Crown Estate Scotland’s involvement in the direct management of the asset whereas, with a delegation, there would still be a relationship between Crown Estate Scotland and the new manager. We view the second result, in which there is the ability to have that relationship, as potentially more attractive to some local managers. It could involve Crown Estate Scotland providing such things as staff support, other infrastructure or guidance. The main on-the-ground difference between the two processes for further devolution is that delegation would enable Crown Estate Scotland to be one step removed from direct involvement.

John Scott

Thank you. Can you give me examples of circumstances in which you might expect each process to be used? What happens if a transfer goes wrong, such as if a body ceases to exist—if, having had assets transferred to it, it goes bankrupt, for example? What would be the fall-back position in those circumstances?

David Mallon

The provisions in the bill make it possible for a community organisation to take on the management of one or more assets on an area basis or a community-of-interest basis. Because of that possibility, the bill could lead to one of the few instances of a non-public organisation managing a public asset. The fact is that it is, unfortunately, more likely that a private company or a community organisation in the third sector will cease to exist. Therefore, the bill’s provisions not only enable a transfer to community organisations but allow for the arrangements that should apply on an organisation’s ceasing to exist to be specified in the transfer order.

For a delegation to that type of organisation to be made, ministers would first direct the existing manager to delegate the management. There would then be a requirement for the existing manager and the future delegate to strike a delegation agreement. There would be the ability through that delegation agreement to specify what would happen should the organisation that is taking on the delegated management cease to exist, including what should happen to the management of the asset in the future.

Also—importantly in the case of delegation—until that unfortunate scenario occurred, Crown Estate Scotland would be involved in some way, shape or form. Therefore, it would be able to readily take on again the direct management of the delegated asset.

John Scott

I am more interested in the transfer than in the delegation. I presume that the transfer is an arm’s-length agreement and that, once an asset is transferred to another body—whatever that body is—it is gone. What happens then?

David Mallon

In the bill, there are provisions that enable the specification of what will happen once the organisation ceases to exist. Over and above that, there is the ability, in theory, for another transfer to another body to take place through another Scottish statutory instrument.

The Convener

I would like to clarify something. I would guess that it is just part of a belt-and-braces approach to cover any eventuality, but for both transfer and delegation there is a reference in the bill to

“another Scottish public authority”,

meaning something other than a local authority. If I am right in interpreting that as belt and braces, that is fine. If not, do you have any thoughts on what other Scottish public authorities might take on the management of assets?

David Mallon

I hasten to add that the Scottish ministers currently have no plans for that. However, ministers consulted last year on a long-term framework for the management of Crown Estate assets. When formulating the bill proposals, we wanted to think beyond the first phase of any transfers or delegations and to consider what might be appropriate in the future as far as the landscape for delivery is concerned.

It is difficult to say where such possibilities might emerge. However, what you suggest is probably more readily a good proposition where there is alignment between an organisation’s existing functions and the area of activity or the economic sector in which the manager of a Crown Estate asset is currently involved. One way of looking at it, therefore, is as providing the potential for greater alignment between the functions of existing bodies and the related leasing function that Crown Estate Scotland operates.

The Convener

John Scott has another question to ask before I bring in Mark Ruskell.

John Scott

This will be my final question, convener. What are the opportunities for public and parliamentary scrutiny of decisions to transfer or delegate powers?

David Mallon

The transfer of powers would happen through a Scottish statutory instrument, which would be subject to parliamentary scrutiny. Obviously such an order would be published and agreed thereafter.

Delegation would take place through a direction to the existing manager, which would be published. The bill does not require the delegation agreement to be published, because the detail is likely to include commercially sensitive information or other information that it would not be appropriate to publish. However, over and above the requirements of the bill’s provisions, ministers’ policy is to have transparency, openness and accountability, and the content of the delegation agreement could therefore be published in some way, shape or form.

I should also point out that, for any transfer, ministers will be required by the bill to consult the existing manager, the future manager and anyone else whom they consider appropriate. Moreover, any delegation will require the agreement of the delegate.

John Scott

You have said that a transfer will happen through an SSI. Given that the transfer of some assets might be quite significant, will such an instrument be subject to affirmative or negative procedure?

David Mallon

The proposal is for any transfer order that seeks to amend primary legislation to be subject to affirmative procedure; if that is not the case, it will be subject to negative procedure.

John Scott

However, in the interests of the openness and transparency that you have already referred to, would it not be better in most cases for the instrument to be affirmative?

David Mallon

The provisions in the bill sit alongside what is likely to be a lot of dialogue that will take place prior to the laying of an order, including discussions with the existing manager, the proposed new manager and other interests. I envisage a lot of that activity taking place before ministers are satisfied that the order is ready to be laid.

John Scott

I see. Thank you.

Mark Ruskell

Why does the bill not contain an automatic presumption that local authorities will be the managers of the foreshore and sea bed?

David Mallon

Ministers have taken a view that a one-size-fits-all approach is not appropriate for such a diverse range of assets. The consultation outlined three options: first, the traditional do-nothing scenario, in which everything would still be managed at the national level; secondly, the devolution of all assets to a local level, either to local authorities or to community organisations; and, thirdly, a case-by-case consideration of the appropriate level for managing individual assets. Although there was no overriding expression of support for any one of those options, the most favoured option was the case-by-case approach. Because of the complexity and variety of assets and the different views that exist on the matter, ministers have carried that approach into their proposals, to enable more than one outcome.

In addition, so far, not all local authorities have said that they want to take on the management of the assets. Ministers did not want to impose the change, especially as some of the assets may have significant liabilities. At present, we do not have a full set of accounts for the entire estate, let alone for individual assets. Only at the end of this year will we have a year of accounts for the Scottish assets.

10:45  



Mike Palmer

We are also aware that, in some areas where local authorities have expressed an interest in taking over management, community organisations have also expressed an interest. It is important to take into account that, as well as local authorities, other types of organisations are interested in taking over management. That is another reason for making decisions on a case-by-case basis.

It may be worth making the committee aware that arrangements are being developed to pilot local management of assets so that we can test-bed the process of transferring management to a local level. Those arrangements are being developed by Crown Estate Scotland (Interim Management).

Angus MacDonald (Falkirk East) (SNP)

Picking up on that point, can you tell the committee what progress there has been on the development of pilot schemes for the devolution of assets to the island authorities? Can you give an indication of the timing of that and of any support that may be required by the local authorities?

I refer members to my interests in non-domestic property in the Outer Hebrides.

David Mallon

Crown Estate Scotland (Interim Management) was requested by the Scottish ministers to continue dialogue with the islands councils about the proposal for pilots of local management in the island areas. Those discussions have continued between Crown Estate Scotland (Interim Management) and the local authorities.

Another strand of thinking that Crown Estate Scotland (Interim Management) has been developing involves the possibility of pilots in other areas. The board of Crown Estate Scotland (Interim Management) has been considering how best to take forward the issue of pilots. It is finalising its thinking and is in dialogue with COSLA and the islands councils about making an announcement on the best way forward in the near future.

Donald Cameron

“In the near future” is an interesting phrase. Discussions that I had with one islands authority indicated that it is very keen to pilot a scheme. I hope you understand that there is not impatience but enthusiasm for pilot schemes and know that the island authorities want to start as quickly as possible.

David Mallon

Another sign of Crown Estate Scotland (Interim Management)’s serious intent to take forward pilot proposals is that, in the autumn, it appointed an independent contractor to develop advice and a programme of work for how it could do that.

I know that “in the near future” is not as specific a timetable as you would like, but it is important that Crown Estate Scotland (Interim Management) makes the announcement, and I do not think that it will be too long in coming.

Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

I have a brief point about the definition of “community organisation” that is used in the bill. First, and most obviously, why is it different from the definition of community bodies that appears to fit in other legislation? Why have a different definition?

David Mallon

What is being contemplated here is different from what is in other legislation, but the bill is modelled on existing legislation in terms of the characteristics and criteria. The value of not exactly mirroring what is in other legislation is that this situation is different and ministers think that it is very important to make it possible for community organisations to take on the management of assets. A third sector community organisation would need to consider carefully whether its constitution and so on will tolerate it becoming the manager of an asset on behalf of the Crown. Other legislation mentions specifically Scottish charitable incorporated organisations or community benefit societies, and the judgment was made that such mentions could imply that it would be automatically possible for any such organisation to take on management. In fact, very careful case-by-case consideration will be required.

Stewart Stevenson

Existing community bodies take ownership, in essence, of assets on a permanent basis, such as Machrihanish airbase. Such a situation is clearly different from being a manager of someone else’s asset. Some bodies are hybrid and own assets as well as managing other people’s assets—I think that Stòras Uibhist is one example. Have you looked at the crossover between existing models and reached any conclusions on what works well and, perhaps in some cases, less well? Community bodies, in particular, have sometimes had local issues to do with definitions of geography. For example, the Ulva buyout depended on the consent of people on the mainland, because the definition is based on postcodes. Have you learned from those difficulties and deliberately come up with different things because of that knowledge?

David Mallon

We have certainly learned from wider experience. The proposed definitions are the product of substantial discussion with policy leads in community empowerment and land reform about what is appropriate for this setting. The conclusions that have been reached so far are about a complex area: Stòras Uibhist has a mix of functions; some charitable and community organisations are a mix of a SCIO and a community benefit society, while some organisations are one or the other; the provisions also make it possible for a private organisation to take on management. The two types of charitable organisation will need to think through the complexities carefully in the context of the asset that they are interested in taking on and the way in which the management would operate, so that they can best ensure that what they want to see happen will not risk their status or existence.

Stewart Stevenson

My final question is about mainly the risks and maybe the opportunities. A community organisation would be a manager on behalf of the Crown Estate. If the community organisation fails, would its liabilities stay in the organisation or would they pass back to the Crown Estate?

David Mallon

The transfer or delegation would be implemented in such a way as to ensure that the asset would come back to the Crown Estate.

Stewart Stevenson

My question was broader. It is clear that the asset that the community body had managed would remain with the Crown Estate. If, for example, the community body concluded that the best way to discharge its responsibilities would be to enter into a contract to manage some aspects of its responsibilities with a third party that then failed, I can see liabilities being created that would have to either stay with the now-failed community organisation or pass back to the Crown Estate. Are we clear about the legal issues that might cause an organisation to fail and who would end up with the liabilities in that category?

David Mallon

A substantial amount of thinking has been done on liabilities. The transfer order or the delegation agreement would make provision for the management of liabilities and a requirement for the manager to keep separate accounts for the management of the Crown asset and the management of any other activities. Therefore, it should be possible to discern the liabilities associated with the management of the Crown asset, which will be helpful to an extent in the scenario that you have painted. However, I do not think that that will be an easy scenario to work through; it never is.

There is also the question of what a liability is. Largely speaking, it is a cost. It could be an historical cost or a future cost.

Thinking through all those aspects has taken up a substantial amount of time to date, and they will have to be properly reflected in the mechanism or vehicle for effecting a transfer so that we can minimise the negative scenarios.

Stewart Stevenson

I am hearing that the community organisation would be allowed to take on a contingent liability or a liability that could pass to the Crown Estate only if the Crown Estate had given permission in the first instance for that possibility to exist.

David Mallon

In practice, that is probably right. It is difficult to make a general statement about such a complex area, but there is an expectation. I go back to the prior question about what the benefit to a community organisation from managing an asset is. I think that it is encapsulated by the idea of having control and some financial benefit for reinvestment in the estate to benefit the community. However, if that is the extent of the benefit, ministers are keen to be careful not to overburden the manager with liabilities that would sit with it if it no longer existed. It is all managed as a Crown asset, so it is about how we can recognise what a Crown liability is and ensure that it is treated separately, as it should be, from the manager’s other activities.

The Convener

I want to raise an issue before we come to Richard Lyle’s final question. There is considerable experience in the Crown Estate of creating local management agreements. How much of an asset will that be in coming to arrangements? The experience among staff of guiding organisations and determining the appropriateness of arrangements might help us to avoid the scenarios that Mr Stevenson has identified.

David Mallon

A lot of experience exists, and I think that the intention is to ensure that that experience is not lost and that it can be accessed and used to think through those issues.

Richard Lyle (Uddingston and Bellshill) (SNP)

Good morning. At stage 2 of the Forestry and Land Management (Scotland) Bill recently, I was successful with amendments to remove sections 18 to 20 of that bill, which might have caused confusion and additional complexity for groups that seek to get involved in land management. The Cabinet Secretary for Rural Economy and Connectivity agreed with those proposals and supported them. What help will you give to groups to realise their potential and their ideas? I want groups to get access and to be part of the new idea. What will you give them? Will you pay for start-up costs or allow them to access revenue streams immediately if they come up with ideas that you guys or girls support?

David Mallon

There are three ways in which that capacity can be built, the first of which involves looking to increase awareness and knowledge of what the assets are and how they are managed so that there is an understanding of what is involved, what could potentially be taken on and whether, in the group’s view, it is appropriate for it to seek to take an asset on.

Secondly, we will I hope benefit from experience as pilot proposals are developed and begin to be implemented. The experience on the ground of running the pilots will help in considering the future use of the powers for ministers in the bill, not only in the pilot areas but potentially in other areas.

Thirdly, the bill includes powers for ministers or Crown Estate Scotland to provide support costs for the transition of an organisation to being a manager or for that matter a delegate.

11:00  



Richard Lyle

So I am right in thinking that you will empower groups and will be prepared to look at any legal proposals that will increase assets or encourage community groups in local areas.

David Mallon

Yes. Any reasonable request will need to be properly assessed and a decision will have to be taken. The Cabinet Secretary for Environment, Climate Change and Land Reform has made it clear that she is interested in community organisations that wish to take on management of one or more of the assets. We are in discussion with Community Land Scotland and other organisations about how we can disseminate information on what the bill enables and how organisations can express an interest. The pilots and, I hope, the parliamentary scrutiny process will be important in raising the profile of this set of issues.

The Convener

Thank you, gentlemen. This has been a useful scene setter for the work that we are about to undertake.

At the committee’s next meeting, on 27 February, we will take evidence from Paul Wheelhouse on the Electricity Works (Environmental Impact Assessment) (Scotland) Amendment Regulations 2017 (SSI 2017/451). We will also consider our draft report to the Rural Economy and Connectivity Committee on our inquiry into the environmental impacts of salmon farming and consider our approach to future work on the marine environment.

As agreed earlier, we will now move into private session. I ask for the public gallery to be cleared, as the public part of the meeting is now concluded.

11:02 Meeting continued in private until 12:56.  



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Second meeting transcript

The Convener

Welcome back. The third item on the agenda is to take evidence on the Scottish Crown Estate Bill at stage 1, with a particular focus on the agricultural assets of Crown Estate Scotland (Interim Management). I welcome Gemma Cooper from the National Farmers Union Scotland, Tom Cattanach from Fochabers estate, Hew Hunter from Whitehills estate, Jim Inness from Glenlivet estate and Brian Shaw from Applegirth estate.

We are already well behind schedule, so I ask members to ask short, sharp questions. If witnesses do not feel the need to respond to a particular question and feel that it has been well enough answered, they do not need to respond. If we proceed on that basis, we will get through this meeting in an appropriate fashion.

I will start with an obvious question. From the evidence that we have had, it strikes me that, although there will always be individual issues, in a general sense there is a degree of contentment with the Crown estate, and with Crown Estate Scotland (Interim Management), in terms of its relationship with tenant farming set-ups. Is that a fair assessment?

Brian Shaw (Applegirth Estate)

Yes. We have come from a position, with the old Crown Estate, where we did not have any communication or say at all. Now we have established a working group and we are getting on very well with Crown Estate Scotland (Interim Management). We like it. There are issues, of course.

The Convener

As ever. Jim Inness, do you wish to concur with that?

Jim Inness (Glenlivet Estate)

I agree with it. We represent the Crown Estate’s four estates in Scotland—Applegirth, Whitehills, Glenlivet and Fochabers. We are the community of farmers. Our working group has come on by leaps and bounds, and we would like it to be advantageous for both sides, going forward.

Claudia Beamish

Good morning, panel. Can I tease out some of the opportunities that are presented by the rural estate? Some of us visited tenanted farms and areas in the previous parliamentary session. We saw interesting models of things such as best practice in managing tenants and encouraging young farmers and young entrants, which is very important. We also saw interesting examples of innovation and management of the environmental wellbeing of the land. Do you see there being any other positive and possible opportunities?

Gemma Cooper (National Farmers Union Scotland)

I can answer that. The Crown Estate provides a unique opportunity for best practice in that, although it is mainly composed of secure agricultural tenants, there will be pieces of land that come back to it. It would be very positive if it had policies that were more in favour of getting young entrants into farming, perhaps by providing something akin to the starter farm units that the Forestry Commission offers. I think that the Crown Estate has a unique role to play in that and it is a really important opportunity, because at the moment, generally, opportunities are very limited.

10:45  



Jim Inness

I would say that we are quite fortunate to be on the Crown estate. Its management would like to see the wellbeing of the estate and the tenants within it, which is a healthy approach. Other landlords may be less scrupulous and less accommodating, so we have an opportunity to show best practice to the other landlords out there.

There is a possible case for a subsidised rent for new entrants to farming, to give them a start. It is in our submission. On the wider issue of rent reviews and sustainability for farmers in the tenanted sector, due account has to be taken of the social infrastructure of where you farm. It is not all about revenue. We have to keep the fabric of these communities intact. If we keep the community intact and the farming intact, the whole thing looks after itself. It is not all about revenue all the time. We have to be careful of how we manage rent reviews going forward.

The Convener

One of the things that I have picked up in dealings with the tenant farmers on the Crown estate is a possible concern about the factoring arrangements. There is not an embedded factor on an estate or even an embedded factor for the whole of the Crown estate that tenants can go to. Very often, it is a local land agent or a locally based land agent, who is available for one or two days a week. Does this bill present an opportunity to change that approach and would you welcome such a change?

Hew Hunter (Whitehills Estate)

We have asked a number of times—would Bell’s Brae have its own factor? The response was always that the Crown Estate relied on Savills to give it more experience and more staff. I think that we would be quite keen to have an in-house factor.

Brian Shaw

We have a junior factor who comes round but he only works two days a week. There is a problem with tenants not being able to converse well. We are only just picking up on emails, but if you want something done, you have to do the paperwork and get it logged. The general tenant will meet up with the guy who comes round and they will agree on something, but then it will be forgotten about. Both sides need to set up a situation where they are quite clear about what they want and whether it can be done.

The Convener

Is it a generally held view that an in-house factor would be a step forward?

Jim Inness

I think that it is normally the case. At the Fochabers estate, we have a specific factor from Savills, and it is the same for the Glenlivet estate. That works, but I think that the fact that we have this tenants working group up and running is like having a halfway house. We have a meeting with the Crown Estate twice a year and we are starting to involve the factors as well.

We are intermediaries between them, so there is more accountability creeping in all the time. Accountability is expanding, which has to be good. We have meetings with our own tenants on each estate maybe twice yearly—just as and when necessary. Up to now, those meetings have been pretty well attended—probably 90 per cent of tenants have attended. Their feedback is that this is good and they have never seen this before. So far, it is all positive.

Claudia Beamish

Do the panel members have any brief comments on investment and whether there is a disparity in investment between different tenanted farms and different areas of the Crown estate? Jim Inness said that it is not all about revenue and I understand his point, but is there any concern that there are showcase areas and then other areas that might lose out a bit?

Brian Shaw

We could not possibly comment on that.

Jim Inness

I farm on the Crown estate in Glenlivet but I also farm down in Dufftown, which is a different type of ownership altogether. It is chalk and cheese with the different landlords. The Crown Estate in the past was the bee’s knees with regard to investment in farms. Obviously, with the way that costs have crept up for buildings, for example, there is not the same money going about but the Crown Estate is still focused on keeping the farms alive and kicking and replacing buildings as and when needed. It is still an on-going situation. It works out.

However, it is not all about money. The farm has to be viable for the future and the buildings need to be up to scratch. The financial plan is pretty good reading. The plan is to grow the portfolio by £2 million in 2018-19. The net revenue would be about £1 million. That is all good but, although the rural estate is worth £96-odd million in capital, the revenue from it is not very clever. That is farming, but it is a key area of the Crown Estate portfolio and it needs to be looked after.

Brian Shaw

We have an issue, particularly in Applegirth, which has been taken over. My family has been there since before the Crown Estate took over. No proper maintenance is ever done. Investment is now left to the tenants, by and large. The Crown Estate does not invest in dairies, for example. However, we are considering maintenance.

An audit must be done. Last night, I got an email from Andy Wells who said that one would be done. If the Crown Estate does not know its liabilities, it cannot do a budget. There are so many underlying issues that need to be addressed that have happened over the years. It is not the current lot’s fault—although it is their problem now—but has come from what happened before. Therefore, an audit must be done.

As tenants, we have the opportunity for an amnesty, whereas we are putting forward our tenant investments. Alongside that, I believe—I think that we all do—that the landlord should understand what his problems are, because he needs to lay aside money to fix the lead pipes and the fallen-down sheds.

The Convener

So, to answer Claudia Beamish’s question, there is an inconsistency of approach to investment across the four estates.

Gemma Cooper

I agree. In general, the tenants are proud to be Crown Estate tenants. That is refreshing in agricultural tenancies. There probably is a disparity between what happens now and what has happened previously. Brian Shaw mentioned the Applegirth estate in Dumfries and Galloway.

Part of the issue is transparency. There has not been much transparency until now, and it is good to see that theme in the bill. The tenants do not have a lot of input into decisions or understanding of how they are made, so a bit more information might help them to feel confident about investment in future.

Alex Rowley (Mid Scotland and Fife) (Lab)

I was going to come in later but, because Claudia Beamish touched on the question, I will ask it now. I am really interested in an audit. I assume that the Crown Estate has not done one. Any large organisation—a local authority, for example—would know the condition of its buildings and other assets. Are we saying that the Crown Estate does not?

Brian Shaw

Absolutely. Only when a tenant comes and says that they have a problem because the roof is falling in is it put into the budget. There are many underlying problems about which tenants are honestly frightened to go to the Crown Estate. There are some houses that need a lot of work. However, an audit is not difficult.

A crazy thing that the Crown Estate has done recently is a drive-by audit. I do not understand it. It is perhaps something technical. The factor phoned me up and told me, “I am driving past your farm very slowly. If you wonder what I am doing, I am doing a drive-by audit.” I said, “You’re a kerb crawler.” I do not know how he can value my farm or whatever part of it they are interested in. The snow was on the ground as well.

Alex Rowley

Can I follow that up? One of the questions that I was going to ask was about the benefits from the Crown Estate in terms of investment. Is there cross-investment to target areas of greatest need? If the Crown Estate does not know the condition of its properties, I assume that that is a serious issue.

Jim Inness

I think that Brian Shaw down in Applegirth has been disadvantaged for long enough. Up in our neck of the woods, in Fochabers and Glenlivet—we could say that Glenlivet is the showpiece—we have been looked after quite well. The agents come round and look at things, and letters have been sent to me over the past six months when there have been issues, such as with the budget, repairs and so on. I reckon that the Crown Estate has sharpened up its act already.

I would not be too worried just yet, but Brian Shaw is quite right that we need to see where you guys are at with regard to the finances of the rural estate and how much needs to be spent in order to correct things. In all fairness, Applegirth probably needs more money spent on it than Fochabers or Glenlivet. I had experience of the other landlord and it is like chalk and cheese, but we need to keep the momentum going.

The Crown Estate should be an example of best practice as regards landlords, input and all the rest of it. If you put the money in, you will get delivery. If the farm is healthy—the portfolio of the buildings and all the rest of it—the whole community is healthy. It all filters back to the environment round about. If you look after the farmers, the whole thing falls into place and is kept intact.

Hew Hunter

I am on Whitehill estate, which was bought as an investment—the Crown Estate has had a lot of money from it. We had opencast coal mining, but Scottish Coal went bust when it was being put back, so the interim committee has had to pick up the pieces in re-establishing some of my farm. However, there is a quarry elsewhere on the estate and the Crown Estate has been able to sell land for housing behind Rosewell, not far from here.

There are only three or four of us farmers left on the estate, and we are out of the way of the rest of them. We are being managed from Dumfries now, so our situation is a wee bit like Brian Shaw’s in that agents are not coming up to Whitehill as much to see what needs to be done and what have you.

Jim Inness

Our working group has regular meetings with the managing agents, Andy Wells and company. That has got to be a good thing, because we can tease out the negative aspects within the portfolio of the rural estate and try to get some more action on that.

Richard Lyle

Among its assets, Crown Estate Scotland is responsible for managing 37,000 hectares of rural land, which includes agricultural tenancies, residential properties and so on. In your opinion, what are the wider benefits for rural Scotland of Crown Estate Scotland continuing to hold on to and manage those assets effectively?

Jim Inness

As I said before, for a rural estate it is self-explanatory. If you manage the assets, it pays dividends right down the line in social infrastructures, environmental balance and the whole thing.

Richard Lyle

What about employment?

Jim Inness

It pays dividends in employment as well; the whole thing is related to a degree. Post-Brexit it could be negative. It is all relevant. That is a tricky question for the future, given that Brexit is a hidden area—we do not know what will happen with it.

Richard Lyle

I do not think that anybody knows.

Jim Inness

No.

Gemma Cooper

There are huge benefits to retaining the Crown estate as it is. These guys have been really clear from day 1 that they are proud to be tenants and think that the estate is a showcase. It could be a showcase for Scotland if it is done right and the positives are built on.

As for the agricultural tenants, the estate has a huge number of the secure tenancies that are left in Scotland, and those tenancies provide opportunities and long-term security. I also point out that, with regard to wider food security for Scotland, these guys are a massive part of the economics of these rural areas, and in anything that goes forward, the emphasis must be on giving them stability, particularly with the future of subsidy support, Brexit and so on.

In summary, then, the estate seems to have been functioning quite well in general, and I have seen no hugely compelling case for splitting it up.

11:00  



Richard Lyle

It was said that you have meetings twice a year, but should you not be having a meeting every month or four times a year to fix the problems that Mr Shaw mentioned earlier?

Jim Inness

We could, but I should point out that, at one point, there were no meetings at all—

Richard Lyle

I know that.

Jim Inness

Then there was one per annum, and now there are two.

Richard Lyle

Push for more.

Jim Inness

You could push for more—

Richard Lyle

No—you push for more.

Jim Inness

Aye.

The Convener

Brian, you seem to be in agreement.

Brian Shaw

That is right. Certain things are coming up. In his email, Andy Wells said that, after our suggestion, the Crown Estate was now going to do this audit—or so we believe—and that it would get in touch with us once it had been organised. That is not the way to go about this. We need to help the Crown Estate organise it to ensure that the job is done correctly and that this is not some top-down thing. We are now part of this infrastructure; in fact, we are buried in the churchyard, so we want to be part of the decision making.

Jim Inness

I agree with Brian Shaw. The Smith commission recommended the devolution of more assets down the line; we have made it quite clear that we want the estates to be managed from a national perspective, but now that we are involved in this process, we seem to be this halfway house between the board and the managing agents. The Government seems to have bought into this; it is delivering, to a degree, what the Smith commission suggested, and I think that that should be built on—and indeed expanded—as time goes on.

As for Richard Lyle’s suggestion of four meetings per annum, it is the same thing as our having meetings with our fellow tenants: you do not have meetings just for the sake of having meetings. The easiest way of ensuring good attendance is to wait until priorities come to the fore and there is something to discuss, such as consultations; indeed, I see that a new one on pilot schemes came out yesterday. That is why you have a meeting.

Richard Lyle

Yes, but given you are already in the door, you should be pushing for more. That is my point.

Jim Inness

I agree, but we should not have meetings for meetings’ sake. There needs to be something of substance to talk about.

The Convener

The door has been opened to another subject, which Finlay Carson will ask about.

Finlay Carson

Jim Inness mentioned the possibility of the bill empowering communities to manage their rural assets more. What is the panel’s view on devolving more of that management to local authorities, other public authorities or community organisations? Could Brian Shaw down in Applegirth, say, form a community group to seek to manage assets, given the issues with factoring in the past?

Brian Shaw

To be quite honest, managing my own business is enough of a job. At the level that we are talking about, it is fine; we can get some cohesion with the tenants. However, all that we want to do is help the thing to run smoothly. We do not want to take over, because it works pretty darn good as it is.

Jim Inness

Can I come in again? You can shut me up if you want to. [Laughter.] We do not really want things to be devolved down to councils, because Moray Council, for example, has a big enough job running its own show. As you know, it is in deep trouble financially. I should perhaps not say that, but it has already been picked up on.

The estates that we represent form a big portfolio; you need expertise to manage them, and in my opinion, that expertise lies in Bell’s Brae. Those people have been doing the work for years, and I do not think that we should diverge from the original format in the slightest.

It is the same with community involvement. Do communities have the money or the expertise to dip their toe in the water? There might be certain avenues—bike trails or whatever—that they could go down, but we in the rural farming sector see it as a no-no.

The Convener

What about the interaction with the wider community around estates? It is not just about the agricultural tenancies. At Tomintoul, there is the village, and other things are going on. How can there be better and wider engagement with local communities in the context of Crown Estate tenants and tenancies?

Brian Shaw

We have created some walks and trails. There was subsidy to help to put them in place. One of the benefits of the approach is that we can regulate where the community comes, rather than have people walking everywhere, willy-nilly. We have made interesting walks along a riverbank and the like. We have nothing to do with the fishings—they are all owned and let out by different people.

I will meet RSPB tomorrow, to do work to try to save the tree sparrow or the house sparrow. People want to talk to us, and we respond.

Jim Inness

Over the past 10-plus years, the Crown Estate has been instrumental in putting in bike trails and walks, especially in Glenlivet—it is way ahead of the game on all that; other estates do not do it. There is community involvement in that. We had a meeting with the community association; I think it was around December last year—no, it was further back, because it was in Richard Lochhead’s time. The farmers had their say, and then the community association came in, and everyone was singing from the same hymn sheet. It was all on a par.

John Scott

I declare an interest: I am a member of NFU Scotland, although I am not a tenant farmer.

NFU Scotland said in paragraph 9 of its submission:

“The group is not in favour of too much local community or local authority involvement and believes that the estate is best served by retention of the national management structure where possible.”

Is that the panel’s view? Do you think that the structure should remain as it is, with, of course, the enhancement of the stronger community links that you have talked about? Does that encapsulate your position?

Hew Hunter

We have said that we want the estate to stay together.

At Whitehills, the community has been given an old steading to develop and use. The Bell’s Brae team will have to get better at publicising what the Crown Estate does with communities. A lot of things are not seen. We have trails in some of the woods, and they need to be better publicised.

Finlay Carson

Are people ruling out the opportunity for a group of tenants to come together to form a community group, which could provide factoring services to tenants in Applegirth, for example?

Brian Shaw

That is the next step, I guess. We have a group in Applegirth, which meets and deals with things.

The farmers are farmers, and they do not want to get too spread out; they want to concentrate on what they are doing, but if there is some way in which we could help, let us hear about it.

Kate Forbes

I want to ask about the farm sales framework and how decisions are made about the sale and reletting of farms on the estates. The bill requires the Crown Estate to “maintain and enhance value” of the estate and the return from it. My understanding is that, at the moment, unless there is a clear justification for an alternative, a unit will always be relet for agricultural use—I understand that the same goes for sales.

Does the panel have any thoughts on whether the new requirements in the bill will have an impact on the farm sales framework, as it stands?

Jim Inness

Why not ask Tom Cattanach to comment on that? He is being very quiet here. He might give you an opinion.

Tom Cattanach (Fochabers Estate)

My opinion is that it should be left the way it is just now. There will be circumstances in which they want to sell a farm, and I think it works well the way it is just now. If you block that, you will shut that off, and it will not be able to happen once the bill has gone through. I would prefer that we were left with the status quo.

Kate Forbes

What about reletting and sales for agriculture?

Tom Cattanach

That can happen as long as the money is reinvested in something else. A farm should not be sold only for the money to be frittered away; perhaps it could be used to provide a higher income for the Crown Estate.

The Convener

What about the reletting of farms that become available? Should there be a presumption in favour of reletting units to existing Crown Estate farmers, whether or not units are broken up? That could help to strengthen the tenancies that are already there. I accept the point about new entrants, but should that approach be taken as opposed to letting units to people who might be farming already, outwith the Crown Estate? Does anybody have views on that?

Gemma Cooper

You would probably expect me to say yes, but we have discussed that and people are quite keen that it does not always happen like that. The Crown Estate recently let a farm on one of the northern estates, and the tenants there are keen that what they call empire building does not happen. They see anything that becomes vacant as a potential opportunity for the younger guys to come in. I do not think that it is the sort of thing that we can have an inflexible policy on.

To go back to Kate Forbes’s question about the framework in the bill, it has become apparent during discussions that we are talking about a massive estate and a hugely diverse portfolio with stuff coming in and stuff going out, and the ability to maintain that is crucial to its long-term survival.

The Convener

Can I push you on the question? It would be good to get clarity. Given what you have said, is there a preference for a unit that becomes available to be let to the next generation—for example, to new entrants who are already involved in the Crown Estate? They could be the sons or daughters of existing farmers who want to branch out themselves. Do you still want it to be done on a wider basis?

Gemma Cooper

There are probably pros and cons to that approach. Given that the majority of the tenancies are 1991 act secure tenancies, those individuals will likely inherit or be able to have farms assigned to them anyway, so we have to question whether that is the right route.

The Convener

That would happen eventually.

Gemma Cooper

Yes.

Jim Inness

In the past 10 years or so, the Forestry Commission has created starter farms. A lot of starter farms have 10-year leases, and at some point they come to an end. The Crown Estate could be a role model in creating opportunities for guys moving up the ladder. By the same token, as has been suggested, we have farmers’ sons branching out with their own structure and taking on farms, and that has to be a good thing. There needs to be a system for people to climb rungs on the ladder, because guys who go through the 10-year leases need that. If no farms are available, they will be dead and buried because they cannot get anywhere.

As regards rental revenue, Kate Forbes mentioned growing the revenue in the estate, but due account also has to be taken of the sustainability of farms. Empire building is a non-starter for me. On the revenue side and the rents that are achieved, it is not all about maximum revenue. As we have seen in the past, people all too often go for big bucks, and three years down the line the tenant pleads poverty and says, “This isn’t working. I need a rent review and a rent reduction to make it viable.”

As regards new farms coming on to the scene for let, there has to be a rigorous forward plan of, say, five years, and there has to be financial accountability so that the rent that is offered can be sustained and we do not have the situation of people pleading poverty in three years’ time. It has to be sustainable. However, that does not necessarily grow the estate as regards revenue. You cannot have it both ways.

The Convener

Okay. Thank you for that.

11:15  



Mark Ruskell

We took evidence from the Government’s bill team a couple of weeks ago on the proportion of net revenue that can be retained by asset managers and reinvested back into estates. The figure of 9 per cent was mentioned, which seems to be an historic figure that is based on Treasury rules. I probably know the answer to this already, but is 9 per cent enough? How does a variation of that figure affect the motivation of managers?

Brian Shaw

I guess that, if the audit is done, we will know. The part of the world that I come from will need more than that initially and for a few years to come. Three or four farms have already been sold off, and that seems to be where revenue is coming from to afford the keeping up of the estate. If that is to be, it is to be. I do not have a clue about the 9 per cent, but it needs to be enough to do what is needed to keep it tenable.

Jim Inness

There is a cross-subsidising element to the management of the portfolio, as some parts of the estate might not be doing as well as others. If the capital fund is grown and if the 9 per cent is too high, there would not be enough money left to divert or to cross-subsidise to maintain the estate portfolio.

To come back on one specific point, farm sales are needed at the moment to provide revenue to keep everything mobile and moving forward. However, we do not agree with selling farms from the central part of our rural estate, because it might start off with one farm being sold, but then two are sold, and that leads to fragmentation creeping in, which is not a good idea. Farm sales have to be analysed in full; perhaps one corner could be sold off so that the estate is not fragmented. By the same token, there should be consultation with groups such as ours before any sales or purchases are made. Perhaps I am being a bit self-important with regard to the group, but it is all to do with accountability and making the right decisions for the benefit of the whole portfolio.

The Convener

To go back to something that Brian Shaw mentioned a second ago, I think that you would all accept that what you as tenant farmers might deem to be necessary by way of repair and restoration work, the Crown Estate might hold a different view on. How do you envisage compromise and mediation working in practice to come to an agreed position? Inevitably, there will be differences of opinion.

Brian Shaw

Let us start by getting all the houses up to a reasonable standard. At the minute, agricultural laws do not require farmhouses to be up to the lettable standard. It is heading in that direction, but some houses out there are really not very good.

As far as maintenance and bringing them up to standard is concerned, that will be quite obvious. What has been stopping or retarding that is the fact that there has not been enough money in the budget. This budget is derisory and we do not know where it comes from; I think that it is just the same as last year. Some tenants say, “Oh yes, we’ll do that,” but the onus has to come back to us to tell the bosses what the situation is so that they can afford to put right the estate in a timely manner.

Jim Inness

That is why a repair and investment audit is totally relevant at this juncture, so that we can see where we are financially and for the future.

Gemma Cooper

To build on what Jim Inness said, the Crown Estate calls it an audit, but I call it a record of condition. This is a chance to start afresh, and carrying out records of condition of all the holdings would be really useful. It could be followed by an agreed schedule of works, which would tie in with the estate budgets.

With regard to wider industry codes, a lot of work is being done by the tenant farming commissioner, which is about behaviour, and I think that that underpins discussions already. I do not see that as necessarily being a source of conflict—it can be just a discussion—but the tenants need information that they do not have currently to be able to be involved in the process.

Mark Ruskell

To go back to the points about the audit and how it might function, will it look at the condition of existing assets or at their economic potential? If there is a farmhouse or an abandoned building on a farm that could be used for bed and breakfast but a substantial investment would be needed to achieve that, would an audit pick that up, or would it merely look at whether the building is falling down and can be retained as it is, abandoned?

Brian Shaw

Yes, it certainly would pick that up. The picture would be painted and then a decision about what would have to happen would be taken. Sometimes, a building is made redundant and then a bit is maybe knocked off the rent. I have had a building renewed. The problem is that there are leases. That is the problem that the Crown Estate and all landlords and tenants have—there is a lease that has to be adhered to. If a building that someone is paying rent for is falling down, it should be replaced. Whether it is replaced in its traditional form is a moot point.

In the cases that I have been involved in, buildings have become worn out. I have pointed out to the landlord that I am paying rent on them but they are no good to me, and they have put up something substantial. They have done good. However, quite a few tenants are not able to push that enough. If there were a review, as Gemma Cooper says, we would all start from a level base and then people who are, sadly, behind at the moment would get up to speed.

Jim Inness

Houses might be not derelict but not being used. You make the point that diversification is an avenue for the tenant and it can be co-funded by the Crown as landlord. That is food for thought going forward but, at the moment, what happens if the house has never been used and is in a sad old state? What happens if it is in a prime location and a decent spot? The landlord will take the opportunity to sell that site or house and grow the revenue, or the capital budget. There are two ways of looking at it.

As regards bed and breakfasts and stuff like that, Glenlivet might be overdone already as regards holiday accommodation, but in other areas that could be a useful secondary income. Any of those avenues will be useful post-Brexit if subsidies are going to decline.

Donald Cameron

I refer to my farming interest, which is in the register of interests.

How should tenant farmers be represented and involved in the decision-making processes of the Crown Estate in this new environment? How would you like to be involved? Do you want the status quo? Do you want more consultation with you as tenant farmers? Do you want a voice in a management structure? What is the best way?

Tom Cattanach

The forum that we have, with two tenants from each estate, is essential going forward, because we can speak with tenants and take forward what they say either to the interim board or direct to Government, if needed. If everybody is in a circle round the table at Bell’s Brae and speaking, we have got to come to good decisions.

Jim Inness

The fact that we are here today giving evidence shows how far we have come. On the question of how we would like things to go forward, we are the farming community that ticks the Smith commission box, and we would like to see our group’s involvement in decision making expand.

Donald Cameron

The convener touched on this, and it is an interesting scenario. If there was a dispute between a tenant farmer and the Crown Estate as landlord, would that kind of system nip it in the bud? Would it help mediate when there are problems?

Brian Shaw

Absolutely.

John Scott

In light of the above, what are your views on the bill? For example, are additional safeguards or commitments needed in some areas? Many of the witnesses said that you quite like the status quo. You have all said that it is a privilege to be tenants of the Crown Estate, so you are already examples of good practice, but how do you see possible improvements being made?

Brian Shaw

You mention safeguards in the bill. We are moving in that direction. The bill provides a big improvement for us. We see nothing lacking in the bill that we are looking for. We believe that we are heading in the right direction. We are not propelling the ship; we hope to steer it.

The Convener

We will finish on that optimistic note. I thank the witnesses for their time. It has been a useful and constructive meeting.

11:25 Meeting suspended.  



11:32 On resuming—  



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Third meeting transcript

The Convener

The third agenda item is to take evidence on the Scottish Crown Estate Bill at stage 1. We will focus on stakeholders who are directly affected by the management of Crown Estate assets.

I welcome Patricia Hawthorn from Scottish Renewables, David Sandison from the Scottish Salmon Producers Organisation, Mark Simmonds from the British Ports Association and Dr Alan Wells of Fisheries Management Scotland. Good morning to you all. We move straight to questions.

John Scott

Good morning, and thank you for coming.

I note the diverse range of backgrounds from which you come. What are your experiences of the Crown Estate and Crown Estate Scotland (Interim Management)? In your view, what makes for good estate management? Discuss.

Dr Alan Wells (Fisheries Management Scotland)

We have wide-ranging discussions with the Crown Estate. The Crown Estate owns about 140 salmon fisheries across Scotland. It sits on several of the boards of our member organisations, the district salmon fishery boards. We have a close relationship with it on the management of wild fisheries.

We also work with the Crown Estate on salmon farming, marine renewables and other developments in the marine environment. For example, we are working with the Crown Estate on identifying and assessing methods of monitoring potential impacts on wild fish with regard to Aquaculture Stewardship Council certification for fish farms and the environmental management plans that come through the planning process for salmon farming.

We work with the Crown Estate on marine renewable leases—we have done a lot of work on the potential impact of marine renewables and offshore wind farms on migratory salmon and sea trout.

Patricia Hawthorn (Scottish Renewables)

Good morning. I am here in my capacity as a director of Scottish Renewables, but I am also a partner in the law firm Shepherd and Wedderburn, which acts for a number of offshore developers, both tidal and offshore wind. I am happy to answer questions from both perspectives, although I am primarily here to represent Scottish Renewables.

The engagement that we have with the Crown Estate is largely through its role as a landlord in the offshore sector in relation to offshore wind and marine wave and tidal projects. In anticipation of this committee session, I spoke to a number of our members. The description that the Crown Estate offered up for itself on its involvement with renewables as being a

“landlord, catalyst and supportive partner”

would broadly be echoed by the industry and most of our members.

The relationship is triggered by the lease process, but the Crown Estate has also been influential in bringing forward licensing rounds for the development of projects and in participating in the delivery of the projects. The supportive role has been important and has ranged from participating in consultations to helping to fund and manage enabling works in the early stages of projects.

Broadly, our engagement is through that landlord and tenant context, but the relationship is a bit wider than that.

John Scott

Do you expect that positive relationship that you have had to continue into the future?

Patricia Hawthorn

Yes. It has been broadly a positive relationship and an effective and efficient management process.

David Sandison (Scottish Salmon Producers Organisation)

Likewise, our relationship with the Crown Estate is mainly based on its being a landlord. We have a significant number of sea bed leases around Scotland’s coastline. Our needs and the scale of the sites that we require for our industry to move forward have developed rapidly over many years, and the landlord-tenant relationship has been productive over that time. Indeed, it is the fundamental relationship, and we view the Crown Estate as a body that has supported our development plans over the years.

Mark Simmonds (British Ports Association)

My association represents the overwhelming majority of ports in Scotland, and most of our members’ engagement with the Crown Estate comes about because the Crown Estate owns most of the sea bed and, in order to carry out and fulfil their statutory duties, our members have to work with it on leases and licences for, say, dredging and maintaining navigable channels. Not all our members have always found that process to be the easiest; it has sometimes been difficult or time consuming, and at times it has added to development costs or caused delays.

In answer to your question about what would be good as far as the management process is concerned, I would say responsiveness; working with the users of the assets; and ensuring that the process remains affordable. Obviously our members cannot move elsewhere, and they will have to work with the manager of the asset.

The Convener

Are you reflecting the view across the UK of dealings with the Crown Estate, or are you talking specifically about the experience in Scotland? Is there a difference?

Mark Simmonds

We have found the experience across the UK to be quite similar, but I am speaking today on behalf of our Scottish members.

The Convener

I was just wondering, because I am interested in finding out, as we move to Crown Estate Scotland, whether you are identifying opportunities for things to be done better.

Mark Simmonds

There is definitely an opportunity for things to be done better, but it remains to be seen whether it will be taken.

The Convener

Have the delays that your members have been confronted with arisen as a result of environmental concerns, local concerns or other concerns, or have they been caused by the process itself?

Mark Simmonds

It is quite often just the process of, say, extending leases or getting licences for certain activities for which, as I said, our members are statutorily responsible.

The Convener

Thank you.

Claudia Beamish

I want to ask Alan Wells about his perception of the interface between him and the Crown Estate. Has the experience been positive in the past, and will it be positive going forward?

Dr Wells

In general, it has been positive, but because we are dealing with the Crown Estate on a range of issues, the experience with regard to each might well be different.

With salmon fishing, we have had a very positive relationship with the Crown Estate, which leases its fishings occasionally to private owners but very often to angling clubs. As I have said, it also participates on the district salmon fishery boards. We are in favour of the management of those fisheries being devolved further, because that will have lots of benefits not so much from an economic perspective but from a wider environmental and social perspective with regard to encouraging access to fishings and getting more people fishing, which is an issue for our sector.

As far as salmon farming is concerned, the Crown Estate takes more of the landlord-type approach that has been highlighted. It is one of a number of elements of the regulatory system, which the committee has previously looked at, and I think that there is a lot of scope for bringing things together and having a much more coherent system of regulation. The Crown Estate has a role to play in that respect, but as far as our interactions are concerned, we have been involved in several projects with it and our experience has always been very positive.

With regard to marine renewables, we were involved in the MeyGen development on the north coast, and the Crown Estate provided some support in getting people around the table for that project. Again, the experience was positive, but one of the things that we would like to see in the bill is a greater emphasis on sustainable development instead of the economic development that has been emphasised in the past.

11:30  



Claudia Beamish

I will turn to the issue of environmental protection—I assure everybody that there was no plan to have Alan Wells set up my question.

Our committee and our predecessor committee have taken a strong interest in mission statements relating environmental protection. Perhaps the bill gives us an opportunity to clarify some of the issues around that.

As you know, the bill says that managers of assets

“must maintain and seek to enhance ... the value of the assets, and ... the income arising from them”,

and that they “may”—I stress the word “may”—do so in a way that contributes to wider objectives, including “environmental wellbeing”.

In their submission, Professor Ross and Professor Reid suggest that the bill could be amended to “require” managers to take into account the considerations that are listed in section 7(2). They also point out that sustainable development

“encompasses environmental, social and economic wellbeing”.

Would it be valuable to change “may” to “is required to”? Do you have any other comments in relation to environmental protection?

Mark Simmonds

This might not be a popular view, but I am not entirely sure that that would be necessary, because you already need to prove that any activity or development that you undertake that has an impact on the environment takes those considerations into account. I am not sure whether the change that you suggest would add an awful lot—it would simply replicate what developers already do.

Claudia Beamish

In relation to the Crown Estate, the point concerns

“the value of the assets, and ... the income arising from them”,

and whether there should be an obligation to take sustainable development and other objectives into account in the business plan and so on. Your comment is fair enough in terms of applications, but there is a broader issue.

Are there any other comments?

Dr Wells

I think that it would be a useful addition. Professor Ross and Professor Reid mentioned that there was a similar duty in the Climate Change (Scotland) Act 2009. Also, the Marine (Scotland) Act 2010 says that

“In exercising any function that affects the Scottish marine area ... the Scottish Ministers ... and public authorities must act in the way best calculated to further the achievement of sustainable development”.

The proposal that you mention is consistent with other legislation, and it would be good to see it in the bill.

Patricia Hawthorn

We would not have any fundamental objection to sustainability being part of any decision-making process, certainly in the renewables context. Looking at the bill, I do not think that that is the purpose of the provision. I think that its purpose is about balance and people’s ability to move away from that value judgment. That is how I read it, in any case, in conjunction with section 11.

I agree with Mark Simmonds that there are other regulatory controls that are focused specifically on sustainability and environmental protection. We have to get all the forms of regulation to sit comfortably with and respect one another, and not all to be looking at the same thing. We would not be fundamentally opposed to the proposal, but I am not convinced that it is necessary.

David Sandison

We hold a similar view on whether the proposal is necessary. We would like as many opportunities as possible to be taken to ensure that there is good alignment with other regulatory regimes, of which there are many in the marine context. There must be alignment with national planning and marine planning, and regard must be given to the fact that there is already significant environmental protection regulation around our activities.

We would like a cohesive bringing together of the planning functions and the Crown Estate in order to make the system beneficial to all. From that point of view, we would not have any particularly strong views about whether the proposal is required.

Claudia Beamish

I do not think that I am making the question clear. The point is about the assets of the Crown Estate. Managers of those assets have a serious responsibility to maintain and seek to enhance

the value of the assets, and ... the income arising from them”.

In the context of responsibilities in reserved areas that will no doubt transfer at the point of devolution, should there be an obligation on the Crown Estate to look at the provision in relation to decisions on assets, rather than regulation? I hope I am being clearer.

The Convener

You have thrown them.

Dr Wells

I will give an example that might help. I mentioned salmon fishings, which are largely in the central belt. They tend to be on rivers that are not necessarily of high value in comparison with other rivers in Scotland. Therefore, trying to get a huge amount of economic benefit from those fisheries might not be the best way to go.

Another route is to look at getting a great deal more social and environmental benefit from those fisheries by getting people to use them, getting people into the outdoors and putting less emphasis on getting an economic benefit from them.

Claudia Beamish

Are there any other comments?

David Sandison

I think that I get where you are going with that question. It is quite interesting—you might be pushing at a slightly open door. I tend to agree with Alan Wells that there is more than just economic value to be accrued from the Crown Estate and that we should be looking at the wider socioeconomics of that relationship. That might be an opening that would allow you to widen things out.

The Convener

The committee has previously expressed its view, in the context of its salmon inquiry, on the regulatory approach to aquaculture, and we will not revisit that today. However, how might the Crown Estate’s role in the aquaculture consent process change? We have heard the SSPO’s view. What advantages and disadvantages might such a change provide for the industry, for local communities and, perhaps most important, for the marine environment?

David Sandison

As I think that we have said, we can see an opportunity for better alignment in the process of getting a lease and the various permissions that people need to carry out their activity. There needs to be good alignment. I am not saying that there has not been good alignment, but when we bring things into a purely Scottish context and look at how they might be devolved further, there is an opportunity for it to be even better. That would be a great benefit at a time when we are looking at the overall regulatory environment and finding that some regulation has to be reviewed, changed and made to fit better with what the modern industries that use Crown Estate assets would like to see.

The Convener

I get why that would be helpful for the industry and, one could argue, for local communities, but what about the marine environment? How would it benefit?

David Sandison

I think that, at a regional or community level, we definitely have to have a view about the benefits of environmental protection to the wider community across the wide range of uses of that environment. With respect to enhancing marine spatial planning and regional planning by bringing in the environmental scrutiny that is required for that process and aligning it to the Crown Estate leasing process, we can achieve that.

Dr Wells

I will again give a couple of specific examples. I preface them by saying that the issue probably should be looked at in the round, with the other elements.

The fish health framework, on which work is being carried out at the moment, will require the management areas in which salmon farming takes place to be looked at. Those areas could be changed if there was an advantage in having fire breaks—for want of a better way of putting it—between different areas, so there would not be a read-across. Leasings in those areas that were not leased could be used to create those fire breaks and keep them in place.

The second example is that, if it were found that a farm was not located in the right place, we could decide not to renew the lease in that area.

Obviously such situations need to be looked at within the context of the wider regulatory regime.

Mark Ruskell

On transferred or delegated management, it is interesting that, in the consultation, differing views were expressed on the ability of various sectors to be involved, either with communities or on their own, in managing or having transferred responsibilities. How will the environment be safeguarded in that situation? Mark Simmonds represents ports and harbours: there are perhaps issues to do with harbour authorities having both regulatory functions and commercial interests. In terms of governance, how do you square those responsibilities? If control of the sea bed was added to the functions of harbour authorities, how would those issues play out? How will the environment remain a key concern if functions are delegated or transferred?

Mark Simmonds

As I said in my previous answer, I imagine that all activities that impact on the environment will still be licensable by Marine Scotland or whoever does that. Therefore, the transfer would not have a huge impact on how things are done. Not all harbours are seeking to, or will be able to, take on asset management, so it will not be a particular issue for them all. As I said, there is a separate and fairly comprehensive licensing process for activities that impact on the environment that will still exist.

Mark Ruskell

My understanding is that harbour authorities already have some responsibilities in relation to the environment, because they are responsible authorities for assessments under habitat regulations. How do harbour authorities deal with that in their governance?

Mark Simmonds

It depends. If, for example, a harbour authority has designations in its statutory harbour area, it will already deal with those in a set way. That will depend on the management measures that have been set out for it, which will depend on the designation. That situation will not fundamentally change.

Mark Ruskell

Are harbour authorities fit bodies to take on transferred or delegated management without any reform of the current governance arrangements?

Mark Simmonds

Yes, they are—absolutely. As I said, harbour authorities have statutory responsibilities for assets that they do not own, which sometimes makes it tricky to carry out those responsibilities efficiently. Harbour authorities are generally good stewards of the environment. Development is usually carried out sustainably, and as I said, it is all licensable. If asset management or ownership is devolved to an authority, that will not mean that development activity will go ahead without permissions from the various licensing bodies.

Mark Ruskell

What about other sectors? Does the aquaculture industry have an interest in owning the sea bed or having delegated management of it?

David Sandison

The simple answer is no. However, we do not see any difficulty in devolution of management arrangements. In fact, that will probably result in quite a lot of enhancement, from the point of view of cohesive community planning and our being part of the community planning and local planning processes. The Crown Estate, or whoever manages Crown Estate assets, should certainly have a role in that process, because that gets down to the wider relationships and needs of communities and how best to align with those. From an aquaculture point of view, that would be entirely appropriate.

Richard Lyle

What is your view on the cases for national management and local management? Who should manage the assets? Does the geographical approach to asset management present any risks to strategic decision making across Scotland, or would it take greater account of more locally specific considerations?

Patricia Hawthorn

From an offshore renewables perspective, particularly with large commercial offshore wind farms, it is critical that management is done at national level.

An important function would be for one body to look at all the opportunities for development around our shores, and to try to work out where the best combination of developments may be. That process has to be done with an overview of Scotland and Scottish waters as a whole, of all the developers that have indicated interest in developing, and of all the opportunities for development that might exist.

11:45  



Our experience so far is that a centralised process is best, so we are keen to make sure that that approach prevails. Another licensing round is imminent—we think that it will take place at the start of next year. In order to remain competitive in the offshore sector in the UK overall, it is important to have a centralised streamlined process that is able to look at all the opportunities, and then to select the best combination for optimising renewable energy and for Scotland.

The Convener

What about the interaction between the roles of the Crown Estate and of Marine Scotland for offshore renewables? Does that work effectively?

Patricia Hawthorn

That interaction does work effectively. Those bodies perform different roles. Marine Scotland is the chief consenting licensing authority and is very much involved in the marine planning process, while the Crown Estate operates primarily as the landlord and the leasor of the sea bed, but it engages closely with Marine Scotland in that process. It is critical that marine planning sits alongside the leasing process; it is an important dynamic that works well between Marine Scotland and the Crown Estate.

Dr Wells

On salmon fishing, some of our members have expressed interest in managing fisheries. Fisheries management works best when it is undertaken at catchment scale, and the district salmon fisheries boards and the fisheries trusts operate on that scale rather than on a smaller scale. That element is useful.

On management, since the coming into force of the Aquaculture and Fisheries (Scotland) Act 2013, district salmon fisheries boards have operated under a legal duty to comply with various good governance requirements, including holding public meetings and publishing annual accounts and reports, so they are a good fit for the community organisation category. If they are not in that category, we have a question about whether section 6(1)(b) would allow Scottish ministers to designate the district salmon fisheries boards or the trusts as part of that process, because they are not a clear fit with any of the other categories.

Mark Simmonds

The BPA supports a mix of management options. We do not want to see bodies taking on management of assets within a statutory harbour area without ports being consulted. There are cases in which that could cause competition issues, because the body taking over management might also own other harbours that compete with the harbour in question.

As I said at the beginning, ports and harbours cannot move away; they have no choice but to deal with whomever they must deal. We have questions about the proposals, but our main view is that, whatever happens, we want to ensure that ports are consulted meaningfully.

David Sandison

There is definitely a case for strong national policy settings for what the Crown Estate does in Scotland. However, we do not have any fundamental objection to whatever level of devolution might be appropriate in terms of the different management arrangements. We would like to see consistency in implementation, with checks and balances being included. We certainly need to see that the national policy context is the umbrella that covers that aspect and checks it from time to time.

Patricia Hawthorn

One of the challenges that Scottish Renewables faces is that it represents a wide range of interests. Among our members, we have islands councils and wave and tidal developers. It is therefore probably right if I add to my previous comments that I see benefit in considering the almost unique opportunities that are offered in the islands for those types of development. I understand that a number of pilot projects are being considered. It seems sensible to approach the matter on that basis.

Richard Lyle

I welcome Patricia Hawthorn’s seeming to have changed horses slightly in mid-stream.

Mark Simmonds must have been reading my second question as I wrote it down. With the UK Government and the Scottish Government, we have two Governments and 32 councils that do 32 different things in their areas. Should not we be able to diversify and do different things in different areas so that we can innovate and allow organisations such as Scottish Renewables to explore Scotland’s potential?

Patricia Hawthorn

I added to my comments because we always have to remember that Scottish Renewables has a range of interests within its membership. I can see clearly that there is a need and a wish in the islands councils’ areas to get involved at the community level.

For the rest of the industry, we have large-scale infrastructure developments to deliver. That is a national priority. We have to find the very best developments around Scottish waters.

We are supportive of the position that things should be looked at case by case and that there should be a functional rather than a geographic basis. Large-scale offshore commercial wind farms are a game changer for Scotland, so we have to consider them at national level.

Richard Lyle

I am going to be really controversial; I am sure that people will come back at me when I say this. Should planning applications for the likes of you guys be decided by national Government rather than by local government?

Patricia Hawthorn

Our offshore developers value highly their relationships with local councils. All offshore developments come onshore somewhere: the communities that are most directly affected are those that are looking at the applications for substations, cables and other infrastructure that might be required.

The consents for the offshore part of the generating station and the cable are decided at national level, as is correct. One party has the overview of where we provide our major generation assets. However, there is always the local connection because the developments have to come onshore somewhere, so relationships around that are very important. Economic development is based around a substation and the cable.

Richard Lyle

Thank you. That was a question that I have always wanted to ask.

The Convener

That moves us on to a question that Angus MacDonald wants to ask, but before that, Stewart Stevenson has a brief question.

Stewart Stevenson

Given the powers that ministers have to exercise under sections 36 and 37 of the Electricity Act 1989, which relate to generation and transmission consents, there is a framework within which ministers are applying national policy and considering the overall picture rather than deciding on pretty small offshore wind sites. I doubt that an offshore wind farm would be less than 50MW.

Angus MacDonald

The written submission from Scottish Renewables suggests that the Crown Estate has specialist legal geographic information systems, and consenting and commercial expertise that are not thought to exist currently in local authorities. The Royal Yachting Association’s submission also warns of a potential dilution of expertise. In your respective areas, what expertise, skills and capacity are required by a manager in the Crown Estate?

Patricia Hawthorn

I am a great believer that skills can be acquired in any context when there is a function to carry out, so I say that skills can be amassed elsewhere. What is incredibly important for our offshore sector is the experience that has built up in Crown Estate Scotland and the Crown Estate’s London office, both of which are still engaging a great deal and in detail about the licensing function for offshore wind. It is not necessarily about the skills—it is also about the knowledge, experience, expertise and ability to compare and contrast opportunities.

Mark Simmonds

I agree. It has been suggested that a national body could be retained to help local and regional bodies with such skills shortages, if they arise.

Dr Wells

There are, in the Crown Estate, skills in relation to salmon fishings, but many of the fishings are leased to angling clubs and so on, and there is a lot of expertise in our sector, too.

David Sandison

There is some acknowledgment that there are skills at national level that are very helpful. However, that is not really a problem for the SSPO. We effectively use leasing and landlord arrangements. As long as the body that carries that out is competent in those functions, it will be acceptable to us.

Finlay Carson

The Smith commission recommended further devolution to local authorities, and your comments on that have been helpful. If powers are devolved, how can we assess whether a manager has the necessary expertise and capacity to manage those assets to meet the Crown Estate objectives?

David Sandison

We would welcome a pilot scheme to test the water before we know the answer to that question. I do not think for one minute that there cannot be further devolution, but it is sensible to go forward on the basis of a pilot scheme. It is not entirely new territory, because the Crown Estate already has different arrangements with the agents that do its work in different parts of Scotland. We should not take too strong a view until we have carried out a pilot scheme.

The Convener

What would be the implications for the practice of cross-subsidies and financial support currently provided by Crown Estate Scotland for different assets if the management were to be decentralised? Offshore renewables are a considerable earner for the Crown Estate and will continue to be in the future, but agricultural tenancies, for example, benefit from the current approach. I recognise that it is probably not an issue for many of you, but do you have a view on the pros and cons of the two approaches?

Dr Wells

That cross-subsidy is an important element and it would be useful to retain it.

David Sandison

Our sector is effectively a cash generator for the Crown and therefore we support several different aspects of Crown Estate business throughout the country. We have no strong view that such a balance should not continue. We see great value in having input at national level to projects that have national significance. However, whatever the new arrangement, as a sector, we would like to see a scheme in which the income from our activities goes back into supporting the sustainable development of our activities for the future and generating potential for growth.

Donald Cameron

I refer members to my entry in the register of interests, which shows that I am a landowner in the Highlands.

Section 10 would confer on ministers the power to restrict the disposal of certain assets, such as the sea bed. In the consultation, the question was asked:

“Should the existing policy—the general presumption against selling the seabed—be maintained?”

It is fair to say that a significant majority of the respondents asked for that to be case, albeit that some respondents did not. Should the sale of a portion of the sea bed be subject to ministerial consent as per section 10? Should the bill be amended to explicitly prevent the sale of the sea bed?

12:00  



Mark Simmonds

I do not think that the bill should be amended to prevent the sale of portions of the sea bed. Obviously, I am referring only to ports and harbours. Our fairly straightforward view is that, if people have a statutory duty to maintain or work with assets, it is not unreasonable that they should be able to purchase or own them. One or two ports have been able to do that but, obviously, most of them have not. In our members’ experience, that just adds to the cost and the time that it takes to do their jobs. Therefore, we do not agree with that suggestion.

The Convener

Can anybody point to what the advantage would be of selling bits of the sea bed?

Mark Simmonds

One advantage would be that of not having to deal with the Crown Estate for licensing or renewing leases, for example.

The Convener

What would the public benefit be?

Mark Simmonds

It would be a more efficient ports and harbours sector. Obviously, ports and harbours bring benefits to the coastal communities in which they are based. They provide direct jobs and support industries such as fishing and manufacturing. If development in ports and harbours is stunted, that will harm the communities in which they are based.

Stewart Stevenson

Leaving to one side the environmental consents that are required for dredging, which is a common activity in many ports, would it make it easier for ports if they owned the ground that they have to dredge and so did not have to interact with the Crown Estate? Are there other examples besides that that would help us to understand the sides of the argument?

Mark Simmonds

Yes—I absolutely agree with that. There are plenty of other things that ports do, such as fixing aids to navigation and other things to the sea bed. They interact with the sea bed in their harbour areas in quite a few ways. There is also the general development of harbours through adding new quays, pontoons and whatever else.

Donald Cameron

Does anyone else have any comments on owning the sea bed? I see that no one has. That is fine.

Kate Forbes

There are a number of Scottish Government strategies. We have the national and regional marine plans, local development plans, community planning processes, the Scottish energy strategy, the tourism strategy and the food and drink strategy. Obviously, each of your organisations will have members with an interest in those strategies. What do you consider to be the key opportunities for the public management of the coastal and marine assets to contribute to those strategies and other strategies? I realise that that is a huge question, but you should answer it in light of the interests of your members and speak about specific strategies.

David Sandison

That leads me nicely to a couple of points. I completely see the need for the arrangements that we have in Scotland to be well aligned with that range of strategies, which touch on different aspects of life. On the arrangements that might be most appropriate, the focus on community planning, what falls out of it and getting it to work well for everybody—whether that is individuals in the community, businesses or organisations—is appropriate. I would like to see as much alignment as possible between how those things are delivered and how the national policy context is taken into consideration when people go about their business. Throughout Scotland, we can certainly improve our lot by doing community planning well and better.

Dr Wells

We have a number of issues to do with migratory fish. The number of fish surviving at sea has gone from about 20 per cent of fish returning to rivers to about 5 per cent, so something is going on at sea that we need to look at.

With regard to overall sustainability, there is an important role relating to what we do in the marine environment, how that is assessed and all the rest of it. However, from our members’ perspective, an important element is having more resource to deal with issues such as huge offshore wind farms, aquaculture and harbour developments. On the wider social and environmental benefit, it would be helpful to have a bit more resource to ensure that decisions that are taken as part of the sustainability process are taken in the right places and for the right reasons. I do not know whether that specifically relates to Kate Forbes’s question, but it is an important element of what we would like to see.

The Convener

That is an interesting point, because there was a theory two or three years ago—it might still be relevant—that one of the impacts on migratory fish is from the electromagnetic currents that are generated by cables for a variety of offshore activity. Marine Scotland did a piece of work on that that was inconclusive. There is therefore still a question mark about the issue. Given that two major contributors to the Crown Estate are coming together in that regard, should the Crown Estate take a role in exploring that area?

Dr Wells

To be fair, the Crown Estate has taken a role in that, although I do not know whether it put money into that Marine Scotland research, which took place in the laboratory in Aberdeen. The research looked at only one form of cabling—I cannot remember whether it was for alternating current or direct current—so there is still a question about that cabling. Along with other organisations, we have had success, in that licensing arrangements have required cables to be buried or to have rock shielding to deal with those issues. However, an awful lot of work is involved in that process. For example, the paperwork for an offshore wind farm is delivered in boxes. My members are relatively small organisations, but they still have to deal with such matters. Some more resource, whether it is top sliced or whatever, would be helpful in ensuring that good decisions come through the process.

Kate Forbes

My next question might require just a yes or no answer. Do the witnesses support extending the definition of community with regard to the management of the sea bed to cover communities of interest, so that it would include their respective interests?

Dr Wells

As I said, we seek clarity about the definition of community. I hope that a district salmon fishery board or, indeed, a fishery trust would be included, but we are not 100 per cent clear about that at the moment.

The Convener

The other witnesses are nodding their heads at that. Does David Sandison want to come back on that?

David Sandison

Our industry has no desire to be recognised in that way in terms of the functional approach. There is no ambiguity about that.

Patricia Hawthorn

Trying to define “community” can be very complicated at times, so I am inclined to agree with David Sandison on that.

The Convener

We have covered all the topics for discussion with the witnesses today. I thank you very much for your time. I suspend the meeting for a couple of minutes before we move on to the next element of our work.

12:08 Meeting suspended.  



12:11 On resuming—  



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Fourth meeting transcript

The Convener

Item 2 is consideration of the Scottish Crown Estate Bill. We are joined by Alex Kinninmonth from the Royal Society for the Protection of Birds, representing Scottish Environment LINK; Councillor Norman MacDonald, from the Western Isles Council; Audrey MacIver from Highlands and Islands Enterprise; Dr Calum MacLeod from Community Land Scotland; and Andy Wells from Crown Estate Scotland. We have a number of questions for our panel, the first of which is from Stewart Stevenson.

Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

Given the diversity of the panel, there is probably no better group of people to answer my question. The bill has a focus on good management. What makes a good manager?

I see that they are all dodging that one, convener.

Andy Wells (Crown Estate Scotland)

Perhaps I should start, given that the question concerns one of the terms in the Crown Estate Act 1961. Obviously, the committee must consider how that term transfers into the new legislation.

The interpretation of the term “good management” in the act has involved the question of operating the business in such a way as to deliver growth in the business, to deliver capital growth in the assets and to turn that to account by delivering revenue—but doing so according to good management. That covers a wide range of different ways of doing things in terms of how you operate, collaborate and work in partnership. It is also about how you take into account a wider range of benefits that you can deliver as the result of any particular transaction or decision. The bill specifies that that should be interpreted more in terms of social, economic and environmental objectives, with more of a focus on a sustainable approach to management, but that is how the Crown Estate has historically interpreted “good management” in any case. It involves making decisions that are in the best interests of a range of different considerations, while, clearly, given the terms of the act, taking account of commercial factors.

Stewart Stevenson

Before I ask others to comment, I would like to clarify one point. You are saying that good management is about more than simply the measurable outcomes and that it is also about the process by which the Crown managers have to operate and the respect that they give to those with whom they work. Am I correctly hearing what has been said?

Andy Wells

I think that that would be a fair interpretation.

Dr Calum MacLeod (Community Land Scotland)

Thank you for that question, Mr Stevenson—it is an important one to start off with. There are various characteristics that make a good manager, such as the transparency of how you act and your accountability to the stakeholders for whom you are managing assets. It is important to have that process in place and to meet those best-value characteristics. In thinking about what constitutes a good manager in the context of the management of Crown Estate assets, I think that it is heartening that the bill contains a clear and unambiguous iteration of the fact that—as Andy Wells just mentioned—we are not thinking about managing assets only in relation to their financial components and that the focus on environmental and social aspects is fundamentally important, too.

Community Land Scotland would suggest that good management is very much to do with the focus on the broader considerations and on ensuring that the assets are managed in a way that ties into a wide array of public policy objectives, not least of which is community empowerment, and what that might mean in practice.

Stewart Stevenson

I have a question for Mr Kinninmonth in particular. In response to the consultation, 79 per cent of respondents said that environmental considerations should be part of good management. I take it that that is something that you and the organisations that you represent are particularly interested in.

Alex Kinninmonth (Scottish Environment LINK)

Absolutely. I would also echo the comments that you have just heard about good management involving transparency and accountability for the wider public objectives, because the environment is a key consideration for Scotland in that regard.

Andy Wells mentioned the interpretation of the 1961 act. The Crown Estate Commissioners have taken that act as giving them a very narrow financial remit. Although they have had to operate under the principles of good management, it has always been up to the commissioners to define what good management is. There has been a lot of progress in recent years towards defining good management in terms of environmental wellbeing and in looking at approaches to widening what value means to include natural capital or the ecosystem services that can be got from natural assets.

It is encouraging that, as the responses to that consultation question note, the bill widens the manager’s duties to include other considerations and wider benefits. I can see the intention in the bill to bring those into play more. I am concerned, however, that section 7, on the duties of managers, still retains the primary duty to

“maintain and seek to enhance—

(a) the”

financial

“value of the assets, and

(b) the income arising from them”,

with the additional outcomes being seen as secondary or discretionary. There is room for improvement in the bill to make it clearer that financial gain and getting a good return from the assets are not necessarily in conflict with achieving wider societal aims.

Stewart Stevenson

Councillor MacDonald, your council area has some significant areas of community ownership, such as Stòras Uibhist. Do these provide a model for the relationship between those who are stakeholders and live in the area and the duties of managers on good management?

Councillor Norman MacDonald (Comhairle nan Eilean Siar)

The principles of good management, as we have heard previously, are about collaboration and consultation with all interested parties and communities. Through consensus if not agreement, it should be possible to manage the assets in a way that is sustainable, both for the community and, importantly, for the environment.

The model of community land ownership is a good example of how collaboration can work positively across the Hebrides and parts of mainland Scotland. Along with community empowerment, that will drive the policy forward in a positive way, but it has to be done in collaboration, by consensus and taking account of the environment.

Local government is very conscious of that. For almost 30 years, we have been involved, on the marine environment in particular, with an international organisation called KIMO, or Kommunenes Internasjonale Miljøorganisasjon. We and other coastal communities call ourselves KIMO UK but in reality we are KIMO Scotland, because the communities that are part of it are in Scotland.

We have been involved in some of the things that, over the past year, are being seen as important for the marine environment, such as the Blue Ocean Network and the efforts of Sky News to take plastics out of the marine environment. We have been engaged, not because doing that will transform our communities but because managing our marine assets, including the oceans, sustainably will prevent significant damage to our communities in the future.

The focus of the Scottish Crown Estate bill is much narrower, but I believe that the community land experience is a positive one and there is nothing to fear about the accountability that goes with it, either for community land owners or for those who work with them. We work in partnership with community land owners, including the Crown Estate, over major projects. There is nothing to fear from devolving that degree of control to local level, provided that it is managed in the way we have already discussed.

Stewart Stevenson

Does Highlands and Islands Enterprise consider that the bill as presently cast adequately describes the range of responsibilities that all witnesses have articulated, with which HIE might or might not agree?

Audrey MacIver (Highlands and Islands Enterprise)

The bill provides a good framework around management in terms of the strategic plan requirement and the management plans that would need to be put in place. It would help ensure that there is forward planning, accountability and reporting back on that. Those are absolutely required from a governance point of view, whether you are managing a relatively modestly sized asset or a very large and complex asset.

To add to the point about what good management requires, it is essential to have the knowledge and expertise in the management outfit. It is a key requirement to recognise the diverse portfolio of the Crown Estate Scotland asset and the range of expertise that is required to manage it. Good governance is essential.

It is also about whole-life asset management and management for the longer term. Looking at the wider social and environmental considerations, and not just immediate financial gain, is a key part of that.

Stewart Stevenson

You have specifically said, in relation to the required management skills, that it is a “complex” and varied environment. Given that Crown Estate Scotland is a comparatively small organisation, does that lead you to say that you would expect the management to be delegated to experts in particular areas in some circumstances, without the Crown Estate necessarily being relieved of responsibility?

Audrey MacIver

With regard to the expertise required, the offshore environment in particular—which is what I am more familiar with, with my HIE energy hat on—is a very complex environment to operate in. It does not necessarily need lots of individuals, but it needs very knowledgeable individuals. It is not necessarily about numbers of individuals or teams or resources; it is about having a strong understanding of the complexity of the environment and the due process that needs to be gone through. Having that understanding is possible at a local level, but expertise at a national level is also required in terms of the industry and the learning that the industry is undergoing, as the offshore renewables sector—if that is what we are talking about—is still in its infancy. That expertise can be quite close and modest in size, but it needs to be very well developed.

It is a case of horses for courses for the more modest assets. We in HIE have been advocating community ownership and community management for a number of years. We are very much working with partners to build the capacity and capability in communities to manage local assets very well and to realise the wider benefits from doing so.

Kate Forbes (Skye, Lochaber and Badenoch) (SNP)

As a supplementary, Highlands and Islands Enterprise has highlighted the potential for conflict if a local authority is both the awarder of planning permission and the receiver of revenues when it comes to aquaculture. Do you think that the potential for such a conflict of interest goes beyond aquaculture? How do you propose that that could be mitigated?

Audrey MacIver

In our response, we highlighted that there is a potential for conflict when a landlord can also give consent. I acknowledge that that is already the case where local authorities own the land and can also consent to new housing developments. We wanted to highlight the potential for conflict and the need to ensure that in any structures there are clear remits and responsibilities and there is transparency around process.

I also acknowledge that at an early stage of leasing for the offshore energy market—round 3 of the Scottish territorial waters and Pentland Firth and Orkney waters leasing in 2008 and 2009, in particular—leasing activity may have been slightly ahead of the planning process, because in that case the marine spatial planning process had not been completed. There has been a lot of learning since that time, and I now see much greater integration of what we look at in terms of spatial and resource planning at a national level and future leasing activity. That alignment can facilitate a more successful planning outcome and having different organisations take that forward. Again, it is about scale. In certain circumstances, it will be fine to have both roles, but in others there might need to be a degree of separation.

10:00  



Alex Kinninmonth

We have raised the matter in our submission and I see that it is highlighted across a number of other submissions. I do not think that it is insurmountable, but care needs to be taken. As Audrey MacIver stated, a number of organisations—not least local authorities—deal with it on a day-to-day basis, and they are well equipped to do so. It is essential that care is taken to ensure that there is adequate internal separation of decision making. The roles of landlord and regulator are very different and it is important that there is clear separation between those two functions within an organisation. In the not too distant past, the Crown Estate was the regulator for fish farming. That situation was untenable at the time and has since changed, but it is a useful recent example in which it was decided that something needed to change. There is no reason why that could not happen in the future. However, what is really important is the internal separation of decision making.

Mark Ruskell (Mid Scotland and Fife) (Green)

Is there a potential conflict of interests with ports and harbours? There has been a lot of controversy over ship-to-ship oil transfers in terms of the statutory responsibilities of ports and harbours to the environment, but there are also commercial opportunities.

Alex Kinninmonth

Exactly. Ports and harbours must tackle those dual roles. Lessons can be learned: that is one example in which there is certainly risk. We need to establish how successfully ports and harbours discharge both those duties and learn from that.

Councillor MacDonald

There is a great deal of separation. In terms of the Crown estate historically, we know that the first that local authorities would have known about consent and a lease having been given would have been when a planning application for the associated onshore facilities came in. They had no say whatsoever in whether it was appropriate to have granted the lease in the first place. More local control of the Crown estate is one of the key drivers for the campaign that has been worked on for many years, and the United Kingdom Government has recognised that and has devolved powers to the Scottish Parliament. We are seeking further devolution of those powers to local communities, because they are where a lot of the expertise on, and understanding of, the impact on the marine environment lies.

Undoubtedly, situations arise every day in local government in which such conflicts of interests need to be dealt with. It is important that conflicts of interests are recognised at the earliest possible point, and that there is then separation in the decision-making process. Ultimately, that will lead to the right decisions being taken. Local government is very well regulated in terms of its ability to do that, and it is something that it is quite accustomed to doing.

Local governments are harbour authorities, as well as being authorities that work with harbour trusts and others. You could not find better examples than those of Sullom Voe in Shetland and Scapa Flow in Orkney, where local authorities very ably manage facilities that are of great benefit to the whole UK.

The Convener

Given the topical and contentious nature of aquaculture consenting, do you feel that there is an additional perception of a conflict of interests, of which you might need to take account?

Councillor MacDonald

I am not sure whether there is a conflict of interests. There are interests: local authorities have a real interest in the continued existence of aquaculture, particularly for our coastal communities. Comhairle nan Eilean Siar has, with the aquaculture industry, entered into voluntary management agreements on the amount of biomass that is put into particular sites. The amount relates to the kind of site and whether there is a constant flow of water that effectively flushes out the area. I see no issue with extending such arrangements beyond that to ensure that where conflicts arise between the aquaculture industry and other industries that use the marine environment, they can come together and reach consensus on how to make the best sustainable use of that resource.

Andy Wells

I would like to clarify a point in relation to the process. Crown Estate Scotland would not normally grant a straightforward lease, but would grant an option to lease, prior to a developer or an aquaculture property going through the planning process. We would grant the lease only once all regulatory conditions had been met.

Dr MacLeod

There is broader issue that touches on the question that Kate Forbes asked about the connection and fit—or otherwise—between asset management, community empowerment and planning processes. As members will be aware, the Planning (Scotland) Bill is currently going through Parliament, and there is potentially a disconnect in respect of communities having their voices heard in planning. It is important that we make connections between the broader planning process, community empowerment and how communities interact in relation to asset management.

Richard Lyle (Uddingston and Bellshill) (SNP)

I want to raise a point that follows on from Stewart Stevenson’s question, and that Alex Kinninmonth touched on slightly. The Scottish Crown Estate Bill sets out that managers

“of ... assets must maintain and seek to enhance ... the value of assets, and ... the income arising”,

but

“may do so in a way that”

contributes to wider objectives including

“economic development ... regeneration ... social wellbeing ... environmental wellbeing”

and so on. Could interpretation of “value of assets” be about anything other than purely financial value? For example, could the phrase be interpreted in terms of the non-monetary value that the asset provides, such as ecosystem services or its recreational or health value?

Alex Kinninmonth

The short answer is yes.

Richard Lyle

I thought that you would say that.

Alex Kinninmonth

I touched on the issue earlier. From the evidence that the bill team has received so far, it seems that, as drafted, the bill interprets “value” and “income” derived from assets in purely financial terms. Perhaps Andy Wells can touch on this from his experience in Crown Estate Scotland. I know that in recent years there has been a big move—not just in Scotland, but globally—towards considering value in terms of natural capital and what we can receive from natural heritage assets that is of value to society in relation to ecosystem services. Clean water, clean air, provisioning of food and pollination are just a few examples.

The Crown Estate has been an early adopter of the natural-capital protocol and in its rural estates it has been piloting approaches on how to use ecosystem services in decision making about how land is managed. That is crucial. I ask whether the bill, as drafted, allows for such innovation to happen and continue. I hope that it does.

However, there needs to be clarity about how “value” is to be interpreted and how it relates to wider societal objectives and delivery of broader national outcomes, which go far wider than just having a strong economy, because that is fundamentally underpinned by the environment.

Andy Wells

Absolutely. Creation of value in addition to financial value in a wide variety of ways is something to which sustainable long-term businesses such as Crown Estate Scotland should aspire. The bill creates real opportunities for future managers—Crown Estate Scotland or any other manager—to consider how they can enhance value in a range of areas, and not just in terms of natural capital, but in terms of social capital. We see driving of economic benefits alongside social and environmental benefits as part of operating a sustainable business: they go hand in hand. Large amounts of the Crown Estate assets in Scotland are in remote rural communities, and we need sustainable and viable businesses operating in those areas. We need communities there to be prosperous and we need the environment to support the businesses, so it is very much in the long-term interests of all managers and businesses to seek to enhance such value.

Audrey MacIver

Highlands and Islands Enterprise has a unique remit for economic and social development, so I very much welcome the move in the bill to consider value not just in a monetary or financial sense but in terms, too, of wider regeneration, and of environmental and social aspects. However, we have picked up on the fact that the bill states that managers “must ... enhance ... the value” but “may” take into consideration other factors. We want to understand whether either there is a hierarchy or all the factors that the bill mentions will be taken into account.

HIE wants to alert the committee to our concern about whether financial imperatives, as opposed to wider benefits, will become the drivers. Those can be at odds with one another. There could, for example, be a drive towards maximising value through new house building in order to get value up as quickly as possible, as opposed to there being thinking for the longer term about energy efficiency and other social developments that could support the community, and which might take a bit more capital investment and might not be at the heart of what the current manager is driving. Through the bill, we need to ensure that management is not seen as secondary to those wider aspects, which we believe are absolutely integral to the overall asset value.

Dr MacLeod

It is really important that the bill and subsequent management of assets make people think about value beyond assets’ simple financial value. That is tied to some aspects that colleagues around the table have mentioned.

Stewart Stevenson started by asking what makes a good manager. In thinking about value and management of assets, a good manager needs to think more widely than just about the financial or commercial aspects of the asset. If you want management of assets to contribute to the ways in which communities are empowered, that is not necessarily easy to do in practice, in terms of value being measurable. However, qualitative value can be shown in some ways—with regard to community confidence, and how social cohesion is increased within communities once they have more control over how they shape their natural and social environments, for example.

There are ways of doing that at grass-roots community level. There can be profound value in such processes in terms of what assets mean for communities more qualitatively, rather than assets being the focus of naked financial valuation. That is important when we think about cohesion of communities and how managing and, in some respects, owning assets contribute to the communities and, more broadly, to Scotland.

Let us not forget that the national performance framework is to be reviewed imminently. Although the focus is on sustainable economic growth as its purpose, there is also the addition—a welcome addition, to be frank—of wellbeing, which is a rather amorphous but very important concept, when we are thinking about how our society and our communities function. The bill’s broader concept of “value”, not as a hierarchy but as something that is on a level playing field, is an important dimension that will contribute to that national purpose.

Councillor MacDonald

There is no doubt that the socioeconomic aspects of the transfer of an asset must be part of the equation, otherwise transfer just will not work. That is already happening when land is being made available for housing, as Audrey MacIver said. When local authorities are divesting themselves of assets, that has to be the subject of a rigorous business case, so that what is being transferred is actually an asset and not a liability. That should apply equally to Crown Estate assets; the asset should be an asset financially and socioeconomically. That is a vital part of the equation.

Richard Lyle

I am glad to know that it will not come down just to pounds and pence. Most of my other questions have been answered.

10:15  



Claudia Beamish (South Scotland) (Lab)

Good morning. I will pin the issue down with a final question on it—unless other members want to come in. All the witnesses have helped with a wide discussion of financial gain, sustainable development, community empowerment and a range of other issues. Professor Andrea Ross and Professor Colin Reid state in their written submission that section 7(1) of the bill has

“focus on narrow financial gain”

and

“may or may not be in the public interest”.

Is the word “may” in section 7(2) enough to cover consideration of the other issues that we have been discussing, which go beyond the financial aspects that the managers of assets

“must maintain and seek to enhance”,

or should the section say “must”? One-word answers will be great, but it will be fine for witnesses to qualify it.

The Convener

You do not all have to answer.

Alex Kinninmonth

Achievement of sustainable development should be a requirement. The submission that Claudia Beamish quoted is helpful and worthy of serious consideration by the committee.

Dr MacLeod

Achievement of sustainable development must be a requirement, although “sustainable development” is a slippery term that is used in a wide range of ways, and so becomes everything or nothing to everybody and anybody. It should provide the overarching framework for the bill.

John Scott (Ayr) (Con)

I toss out the idea that widening the duties of managers and different responsibilities being given to others, such as local authorities and communities, will come at some cost. Will those things dilute the ability of the Crown Estate to yield revenues to the Scottish Government? Is there a balance to be struck? I see us charging down one road. Local authorities want very much to have the benefits of what were previously Crown Estate assets. Will not that ultimately lead to disintegration and fragmentation of the Crown Estate?

The Convener

I guess that that might dilute the Crown Estate’s ability to cross-subsidise the agricultural estates—

John Scott

—or to work efficiently, at any rate.

Councillor MacDonald

That does not necessarily have to happen. If an organisation is taking responsibility for management of an asset, it should also be able to accrue some of the revenues. In all the discussions so far, we have spoken about the net revenues from the Crown Estate being transferred in order to support sustainability in management of the asset. However, Crown Estate Scotland will still have to retain responsibility for the land-based estate in particular, but not exclusively, and some kind of control over it. We welcome some of the recommendations that it has made and how it is changing from its historical position.

I do not see widening of managers’ duties and giving of responsibilities to other bodies as threatening dilution of the Crown Estate. The fact that there is consensus on how to move forward on transfer of assets and the revenues that go along with them strengthens the Crown Estate’s ability to do the work that it will do.

Andy Wells

I will respond to Claudia Beamish’s question about whether section 7(2) should say “may” or “must”. It could go different ways. To take a wider perspective, in transactions in which one might want to take a more commercial view, inclusion of “must” might result in challenges to decisions: it could be a judicial challenge, which would impact on the business. I urge consideration of that.

Claudia Beamish

There could be a legal challenge to any bill. Why would there be a legal challenge if there was a “must” relating to the aspects in section 7(2) as well as to those in section 7(1)? We are talking about the new devolved settlement for the Crown estate, so I do not understand why you are saying that.

Andy Wells

I am thinking of decisions that may be made in relation to investments, for example. A challenge might be possible. I am not a legal expert, so I cannot comment on why one may be interpreted differently from another. I am not suggesting that it is either one way or the other, but there is a consideration there.

The Convener

Would the consenting of offshore wind farms perhaps be an example?

Andy Wells

That might be one.

Claudia Beamish

Surely that process must involve taking into consideration the contribution to the wider objectives of

“economic development ... regeneration ... social wellbeing, environmental wellbeing”

and “sustainable development”. I cannot see what the conflict would be in a Scotland that works for sustainable development for the people of Scotland. I do not understand.

Andy Wells

I do not disagree with that. It just may be a consideration—that is all that I am saying.

The Convener

What about John Scott’s point?

Andy Wells

Sorry, but can you remind me what that was?

John Scott

In essence, with all this devolution of responsibility and income to other bodies, what will be left for the Crown Estate to do? Will there be a body left? The bill will lead to disintegration and fragmentation, given all the devolution of responsibilities and accountability to other bodies and communities.

Andy Wells

Again, much will depend on the scale and nature of the assets that are under devolved management and the needs of those assets. The way that we currently work as a national body managing the estate as a whole, particularly in how investments are made, is to raise capital for reinvestment from within the whole portfolio. We may sell off assets in one part of the estate to fund investments in another part. A local manager will have less scope to do that, although obviously there is scope in the bill for a national framework and for ministers to direct one part of the estate to fund another. It could be workable, but there could be an issue in relation to some of the opportunities to cross-subsidise across the estate.

The Convener

A lot of people want to get in, so I ask everybody to be concise.

Dr MacLeod

One perspective on the bill is that it might dilute the role of the Crown Estate; another perspective, which Community Land Scotland advocates, is that the concentration of attention on devolution is a good thing, as it adds to the democratic process by involving organisations and communities in managing assets, which is useful and adds value in the ways that we have already outlined.

Alex Kinninmonth

I have a supplementary comment on Claudia Beamish’s question. There is a sustainable development duty on ministers in other legislation, not least the Marine (Scotland) Act 2010, which places a general duty on ministers to act in the way that is calculated to best further the achievement of sustainable development, including the protection and, where appropriate, enhancement of the health of the Scottish marine area. The Climate Change (Scotland) Act 2009 places a similar duty on ministers to contribute to the achievement of sustainable development, and the land use strategy, which comes out of that act, must also contribute towards sustainable development. It is a very well-used term in Scottish legislation. The issue comes down to the principle that the national assets should be managed for wider public benefit, and primacy should be given to managing for intergenerational equity. The framework for sustainable development allows that to happen quite well.

Audrey MacIver

From an offshore energy and industry perspective, ease of doing business is absolutely critical in what is a very complex and, as I said, relatively young industry. The industry players are looking globally at opportunities. From our perspective of trying to derive economic value from supply chain development in the offshore energy sector, we believe that an approach to leasing at a national level must be maintained and that the approach should not be further fragmented.

Stewart Stevenson

I want to return briefly—with Mr Wells only, I suspect—to the issue of “may” versus “must”. If “must” is used, that will apply to every single decision, but I imagine that there will be essentially neutral decisions. A decision that was made in the past might have to be revisited, and it might properly be concluded that no change will be made. However, that would be a decision. If “may” is used, the decision can be made without opening up a particular hoop for legal challenge, but if “must” is used, every single decision—even on whether to move from 80 to 70 grams per square metre paper in the corporate printers to save paper—could be open to challenge. Is that a fair characterisation? In other words, one needs to look at every specific instance of “may” and “must” to see the specific effects, and one must be extremely careful in legal drafting terms.

Andy Wells

Stewart Stevenson expressed that far more eloquently than I did.

Stewart Stevenson

I think that that will suffice.

Alex Rowley (Mid Scotland and Fife) (Lab)

As was said earlier, Professor Ross and Professor Reid suggested in their submission that the bill should be amended to include a mandatory requirement for sustainable development to be taken into account. As somebody has said, around 10 per cent of the acts of the Scottish Parliament contain sustainable development provisions, even though there is no legal definition of sustainable development. Should sustainable development be defined in statute? Should consideration of environmental, social and economic wellbeing, as well as regeneration, be required as subsets of sustainable development?

Councillor MacDonald

It is absolutely right that that should be the case. If sustainable development “must” be taken into account, then clearly it is also about socioeconomic and wellbeing issues—it is about all those issues. The reality is that ministers have to do that in any event. If sustainable development is taken into account, that does not mean that there has to be a huge piece of work to do that, but it must be considered before a final decision is taken. That happens right across the spectrum. If sustainable development “must” be taken into account, then that has to be done. If the word “may” is used, people can choose not to take it into account, whether or not there are socioeconomic or sustainable development benefits.

Angus MacDonald (Falkirk East) (SNP)

The issue of national or local management has already been touched on. We know that the Smith commission recommended that responsibility for the management of the Crown Estate’s economic assets in Scotland

“be further devolved to local authority areas”

in the northern isles and in the Western Isles.

Orkney Islands Council has said:

“While the Bill’s provisions in respect of management are deemed workable, they are not considered ‘appropriate’ when read alongside the Smith Commission recommendation.”

Comhairle nan Eilean Siar indicated that the bill should have devolved powers to island councils rather than set out a methodology to enable devolution and specifically considered the case for the devolution of lease management of offshore wind out to 12 nautical miles and for aquaculture. HIE suggested that national management of wave, tidal and offshore wind energy—we have heard this again today—is

“the preferred option of project developers and will assist in achieving the potential of offshore renewables. It will also make for simpler industry engagement”.

Will the bill deliver the Smith commission’s recommendations? If not, what is required either through a change in the bill or other action?

Councillor MacDonald

We clearly believe that infrastructure within 12 nautical miles, whether that is offshore renewables or aquaculture infrastructure, is something that we and our communities would want some control of, because the reality is that it will be developments within 12 nautical miles that will be most likely to have an impact on the land-based infrastructure, including on our shoreline. We see that from time to time, due to adverse weather. I do not want to focus on aquaculture, but the breaking up of cages has to be dealt with.

10:30  



There has to be some control of such assets, whether they be offshore renewables, aquaculture or other industries that we are currently not all that clear about. Communities should have a significant say as to whether a development should go ahead, because they will be most affected by it.

The Convener

What about the national interest?

Councillor MacDonald

The national interest can be part of the equation. As regards even onshore wind developments, the planning authority is not the local authority but the Government. However, local authorities treat every onshore application as though we were the determining authorities: we make our submissions to the Government on that basis and it takes them into account. As such authorities, we have a significant say in developments and we carry out wider consultations in the community, which enables the Government to make the ultimate decisions. It is therefore important to have local control up to the 12 nautical mile limit.

The Convener

With respect, the two positions that we have heard on this issue were probably fairly predictable, given where you are coming from, which is quite understandable. What views would other panellists articulate?

Dr MacLeod

Community Land Scotland is clearly in favour of mechanisms that will ensure that the power to manage such assets is devolved as far as possible in relation to levels of governance and of management. While we broadly welcome the provisions in that respect that are contained in the bill, where there are opportunities for local communities to have an influence and a say in managing and shaping how such assets are used in the broader context of national interest considerations, as Norman MacDonald has mentioned, it is critically important that that actually happens and is made to happen in the legislative provisions that exist.

The committee will have seen from our submission that we make other wider points on aspects of how that might be managed with regard to foreshore elements and also—as I think has been mentioned in other evidence sessions—the ownership or otherwise of aspects of the sea bed. Bringing such matters into local consideration is paramount, from our perspective.

Alex Kinninmonth

We are neutral on the topic of management transfer to the local level versus retaining a national, geographic or functional level. For us, the key consideration is whether the transferee has sufficient capability to discharge the duties and liabilities that come with that role and whether it is subject to appropriate scrutiny. The case-by-case approach that is proposed in the bill seems to me to be appropriate—again, subject to there being sufficient transparency and scrutiny of ministerial decisions on that.

We often talk about two very different roles relating to development in the marine environment. One aspect that the bill deals with is the leasing of the sea bed. Of course, there is a parallel regulatory process about licensing what can happen on the sea bed. Those two issues are very different but are sometimes mixed up in discussion. It is worth noting that the Marine (Scotland) Act 2010 is often lost in discussion of community empowerment but is very much aimed at that, in that planning and decision making in coastal waters were to be developed through regional marine plans developed by marine planning partnerships.

We are a number of years down the line from the publication of the national marine plan in 2015, yet we are sitting without a single regional marine plan having been adopted in Scotland. Before we start talking about the transfer of assets in terms of leasing, we really need to commit to establishing regional marine plans around Scotland’s coastline. We need to get the order right. We need to know what we want and what we aim to achieve from the use of and development and activity in our marine environment, then we can think about leasing and getting financial benefit from that. It cannot happen in the reverse order.

Claudia Beamish

I want to ask Calum MacLeod about Community Land Scotland’s written submission in relation to the question that we have been exploring. The submission suggested that land ownership is a key driver for sustainable development. How does that fit with the bill? Does it give opportunities for that in relation to the Crown estate? I understand of course that, if something is sold, there has to be a quid pro quo or whatever in terms of assets, as you cannot just sell off the Crown estates. It goes back to what Councillor Norman MacDonald highlighted about the importance of community ownership. I stress that as a member for the South Scotland region; it is important not only in the Highlands.

Dr MacLeod

Thank you very much for that really important question, which gets to the nub of the critical issue of the relationship between ownership of assets, whether land or other assets, and their management. You will hear two different views on that. One suggests that it does not really matter who owns the asset and that it is how it is managed and used that counts. That is important and I do not dismiss that perspective. However, ownership is a critical element in many instances with regard to how the asset is used and managed. It is critical to have and recognise the relationship between land and/or other asset ownership and the use of that asset, and the influence between the two.

If I understand the nub of your question correctly, you are asking about the importance of ownership as a driver for sustainable development.

Claudia Beamish

Yes, and particularly in relation to the bill, as that is what we are taking evidence on.

Dr MacLeod

We argue that ownership—where appropriate and on a case-by-case basis, but certainly with a pre-emptive right with regard to, for example, foreshore rights—is critical. Enabling communities to have ownership of particular assets allows them the autonomy and democratic process—when they are community land owners—to shape how the assets are used in practice. That is critically important in the context of how, bluntly, communities thrive, survive and prosper as, in many cases, they are quite fragile communities.

We are also thinking about the broader question whether the Crown estate will become fragmented and what its purpose will be in terms of the bill. That is not even a price that has to be paid—it is really important to follow that through. Enabling communities in appropriate circumstances to own Crown Estate assets will add value in various ways to how those communities make themselves sustainable.

I have an added comment in relation to that. We talked about the legal challenges to sustainable development issues. If we are not measuring or addressing any of the assets and how they are managed on sustainable development grounds, what are we measuring them on?

Finlay Carson (Galloway and West Dumfries) (Con)

HIE suggested:

“there is scope for the rural estates ... to be managed by communities where there is an aspiration ... a viable management plan ... and capacity to deliver.”

What is the case for communities managing rural estates in the objectives of the Smith commission and in the bill?

We have already heard that there is no appetite from current tenants for a change in the status quo and no desire to become a community group to manage their own estates. What is your response to that?

Audrey MacIver

The point around aspiration is key: it is about where there is indeed community aspiration, which is where Highlands and Islands Enterprise seeks, with partners, to support those communities and enable them to see that process through. The current consultation on pilots will highlight where there is appetite or otherwise, and I think that due attention will need to be paid to that.

The context in which we made that comment in our submission is that we see opportunities in particular communities for subsets of the estate to be taken into community management in order to derive the benefits that we have witnessed in other parts of the region. Again, however, there is a distinction between that context and the offshore context, where we believe that a national, strategic approach is required.

The Convener

What subsets do you have in mind?

Audrey MacIver

There could be community involvement in the management of assets such as small harbours or moorings, and in access to and management of land from the point of view of the creation of recreational facilities in the interests of tourism. That could bring about wider indirect benefits than would be the case if the assets were managed more remotely or at a national level.

Finlay Carson

In relation to the suggestion that communities could manage rural estates, is there a potential for conflict in a situation in which the current tenants have no desire to be managed by a community? How would that be resolved?

Dr MacLeod

The question suggests that tenants are separate from the community itself. I do not think that they are, and I do not think that that is the intention.

It is important not to lose sight of the fact that whether a community would take over the management or, indeed, the ownership of a rural estate is a question not only of the community’s appetite for that—which Audrey MacIver just mentioned—but, importantly, of the will of the broad community, of which the tenants are an equal and legitimate part. As the committee knows better than most, there are legal elements in relation to the community right to buy, but the broader principle concerns the fact that a community must state clearly why it wants to take on the management or ownership of an asset, and it must understand the collective benefits that are to be achieved, which might not otherwise be achieved.

Throughout the Highlands and Islands, and certainly in the Western Isles—this does not apply to quite the same extent in the south of Scotland, although that is coming on, too—large estates that have been taken over by communities have been revitalised in economic, financial, environmental and social terms. The idea that communities are too small or do not have enough capacity to take on such roles is misguided.

Having said that, I do not want to lose sight of your question. The central point that you make concerns how we work in relation to that dynamic. I think that the processes are there to enable such issues to be dealt with where there is a will to make that happen.

The Convener

In addition to the issue of resistance on the part of tenants to such a proposal, would it not be the case that a community that looked at the liabilities that are involved in a rural estate—for example, the backlog of repairs on tenant farms—would shy away from it?

Dr MacLeod

That can be the case, of course. I am wearing my Community Land Scotland hat today, but my other hat, as it were, is one that involves consulting communities on sustainable development issues. Part of that process concerns how people think about liabilities in relation to assets that they might manage and how they might manage them.

There are some important questions to be addressed around how we manage liabilities with regard to the public interest and the common good in terms of the sustainable development of communities and the sustainable management of assets.

As I was going through the previous evidence sessions, I noted that there was some discussion with Scottish Government officials about how the liability element might be managed. Something imaginative, or at least progressive, could be done there, which might help communities to engage with asset management in ways that contribute to their sustainability and add to the broader common good and the public good.

10:45  



Councillor MacDonald

The reality is that, whether or not tenants are involved, if there is no appetite in a community, or even if there is an appetite but it turns out that, when people look at the business case, the asset is really a liability, the proposal just will not happen. As Calum MacLeod said, although many parts of the outer Hebrides are under community ownership, there are significant pockets that are not under community ownership for that very reason, so there is no imperative there—there is no forcing it. It is entirely down to the community.

John Scott

Do the witnesses think that within communities there would be the capacity, or indeed the expertise, to manage the land portfolio of the Crown Estate? For my part, I am not certain that there would be, but I am interested to hear what you think.

Dr MacLeod

It will clearly depend on the context of the particular estate and whether the community is in a position to manage that land. That is not to dismiss the examples of communities that have taken on very large estates and have managed them successfully. Stòras Uibhist is a classic example of that—it is a community landowner that is now involved in multi-million pound partnerships and regeneration schemes relating to that asset. Whether a community would wish to take on the management of one of the Crown Estate’s rural estates would have to be determined in terms of its will and its capacity to do that, but to suggest that that is not feasible would be to dismiss the potential capacity and expertise that communities may have, which would enable that to happen. It will vary in different contexts, but I would certainly not rule it out on principle.

John Scott

I would be interested to hear the views of others.

Andy Wells

In the context of managing the assets as they stand, either as a whole portfolio or as part of a fragmented management structure in which different managers operated different parts of rural estates, there would clearly be challenges in accounting for capital investment. I have alluded to the fact that we often have to sell property on one estate so that we can invest in another, and there are a number of overall liabilities associated with the management of certain properties that are not attached to another and which we have to plan for and manage. That is not to say that it cannot be done, but there could be some practical issues in continuing that on-going investment.

Can I take the opportunity to answer a couple of questions that I did not get a chance to answer earlier?

The Convener

Briefly.

Andy Wells

In relation to the sale of assets, under the bill, any manager is able to sell and buy assets. The key thing is that the capital that is derived from those assets is reinvested in land and property. That is something that could happen in relation to the sale of foreshore, and is happening in certain circumstances in relation to asset sales to communities.

Going back to the strategic national infrastructure, there is clearly a case for ministers to have a strategic approach to offshore wind and marine environment cables and pipelines, but I highlight the views of tenants as also being critical, not only in relation to those assets but in relation to rural estates. We operate in a business environment and we have strong relationships with future business tenants as we work to unlock potential, so the importance of those tenants’ views should not be underestimated.

Dr MacLeod

One of the central arguments for community land ownership is that it is responsive to the community’s needs and helps to shape that community. The evidence from previous sessions suggests that it is not necessarily all milk and honey with the Crown Estate at the moment. I was very interested to hear Mr Brian Shaw from the Applegirth estate say that

“There are many underlying problems about which tenants are honestly frightened to go to the Crown Estate. There are some houses that need a lot of work.”—[Official Report, Environment, Climate Change and Land Reform Committee, 13 March; c 26-27.]

There are some capacity issues there, as well as issues around resolving some of the social conditions in which tenant farmers and other folk on such estates live.

One of the reasons why the Ulva buyout has been successful in getting approval from the Government is that it has a business plan and a real agenda to refurbish and renew the island’s housing—its social fabric. There is no way in which it would be appropriate to dismiss the potential of communities to replicate such a process on a rural estate or elsewhere.

John Scott

Your point suggests that if the amount of money that is available to those communities was also available to the Crown Estate to carry out work for those admirable and necessary social purposes, it, too, would have the ability to refurbish housing. If it had the ability, the Crown Estate would do that work, would it not?

Dr MacLeod

It would potentially have the ability to carry the work out if it made the management decision to do so. However, at the community level you find a clear commitment to doing such things, and the grass-roots process also enables communities to make decisions on such matters, which Community Land Scotland sees as invaluable.

Finlay Carson

Given that the well-performing rural estate currently subsidises the less well-performing parts of the Crown estate, if the community were to consider the economic viability of a good part of the estate, would recognition also need to be given to the impact of fragmentation on the less sustainable parts of the estate? Would the whole portfolio be recognised in any fragmentation or devolution of the viable parts of the estate to communities, including the impact on the less viable parts of the rural estate?

Dr MacLeod

Any such transfer of ownership would need a measured decision on value across the different elements that we have been discussing, such as whether community, economic, social and environmental benefits are associated with ownership of one aspect of the estate or several. On balance, that would create a public interest argument for that transfer.

We are not suggesting for one second that it is a straightforward process; we are suggesting that it would be a missed opportunity to dismiss the possibility of incorporating that as a principle.

The Convener

On that note, we will move on.

Donald Cameron (Highlands and Islands) (Con)

I refer to my entry in the register of interests as a landowner in the Highlands. I want to ask about pilot projects. The various island authorities that I have spoken to have expressed a real enthusiasm for pilot projects. They are very keen to get on with it—they have been for quite some time. Is the panel satisfied that sufficient progress has been made on pilot projects?

Councillor MacDonald

The three island authorities are very clear about wishing to progress with the pilots. The consultation on the pilot process has only just concluded and it will be some time before we get to see the submissions that were made to it. It is really important to take pilot projects forward. The discussions that we have had with our colleagues in Orkney and Shetland make it clear that their pilot projects will be different from ours. We are quite clear about what we want our pilot project to be about, which is Crown Estate assets out to 12 nautical miles and working with the capacity that the community can bear, which, as Calum MacLeod has already said, we have very clear evidence of through community land ownership.

There is no great difference between community land ownership in principle and ownership of the marine assets that already contribute a significant amount to those communities. It is about having local management and control, with local revenues that can be reinvested in facilities that enable things to go further. We hope that our pilot projects will be our starter for 10, because we will be able to demonstrate through them that we have the capacity and will to undertake them and that safeguards are in place for taking the process forward in a regulatory framework and—importantly—with local management. That is where the biggest gains will come from in relation to the Crown estate.

Andy Wells

I can comment on the financing in terms of progress. Clearly, it is something that Crown Estate Scotland and the board have been keen to pursue. However, we must bear in mind that we are only a year old and that we have had a huge focus this year on getting the business up and running following the transfer from the Crown Estate. Immediate financial cash-flow difficulties were a huge priority and we had to get a corporate plan in place, which has been done. The board had to settle in and understand the assets, and the drive to develop the pilot programme was taken forward as soon as was practicable. The board and staff have visited many councils to understand their aspirations. As has been said, the consultation process has just been completed and the first pilot applications are expected to come through in June this year. It is a two-stage process and, following the responses to the consultation, we hope to refine it and get up and running as soon as possible.

Mark Ruskell

On the retention of net revenues by asset managers and reinvestment in the asset, you will probably be aware of the evidence that we have had on the 9 per cent figure. I do not fully understand the methodological basis of that. However, you have all submitted strong views on that point, which I want to explore. In particular, what are your views on what the redistribution methodology should be? How do we calculate that redistribution?

Andy Wells

I can clarify that.

Mark Ruskell

It would be useful to have that clarification before hearing other panel members’ views.

Andy Wells

It comes back to the way in which Crown Estate Scotland has to separate its revenue account from its capital account. The capital is part of the ownership, under the Crown, of the asset itself and is retained as such. As I mentioned, any capital raised from sales is reinvested in the estate. Under the terms of the Crown Estate Act 1961 and of the Scottish Crown Estate Bill, any manager needs to turn that capital into account through generating revenue from it. That revenue, minus the costs of securing it, is then surrendered to the Scottish Government. Before doing so, under the terms of existing legislation, 9 per cent of that revenue can be moved into the capital account, and that is normally calculated on the basis of the previous year’s turnover. So, 9 per cent of gross turnover can be moved into the capital account, which creates an opportunity for the business to use that capital for reinvestment in the asset. In the current year, because we do not have operating accounts for last year—we were not Crown Estate Scotland then—we are having on-going discussions with the Scottish Government as to how that 9 per cent will be determined.

Audrey MacIver

I, too, admit to not being clear about how the 9 per cent is derived, but I thank Andy Wells for that clarification. In our submission, we went as far as suggesting a top-up of that 9 per cent, particularly for community organisations. We do not necessarily advocate a specific number, but we are mindful of the financial incentive. Taking on board all other comments on the issue, we have said that, although the incentive is not only about the financial aspect, we wonder whether 9 per cent is sufficient for community organisations to have good and proper management of the asset. We are flagging up the need to understand whether that is the case. Perhaps we will get more understanding of that from the pilot process.

Mark Ruskell

In measuring and evaluating that incentive, do we again come back to sustainable development? If so, is it therefore about having clear objectives for reinvestment and delivery for communities?

Audrey MacIver

Yes.

Mark Ruskell

Can I get some more views, please?

11:00  



Councillor MacDonald

There is no doubt that we would prefer to refer to the First Minister’s statement in, I think, 2015, when she stated that 100 per cent of the net revenues would be returned to the communities in which they were generated. I recognise that there is still quite a lot of complexity about the distribution and there needs to be a major focus on that in the near future otherwise it will be difficult to set parameters for how the pilot schemes can be taken forward. That will have to be resolved with much greater clarity than we have at the moment before things can move forward. It is key for us to address that, for the communities who aspire to take control of the management of the assets and for the Crown Estate. There are fundamental issues around distribution that need to be resolved in the near future.

Mark Ruskell

Do you see part of that reinvestment as being reinvestment in your capacity as a council to manage assets? To come back to Audrey MacIver’s point about ensuring consistency and professionalism among asset managers when it comes to renewable energy development and leasing, I presume that councils have gaps in that regard. Do you therefore see that reinvestment as reinvestment in your council teams so that they can deliver or is it about community benefit?

Councillor MacDonald

We do not necessarily see it as reinvestment in council teams. As you have just stated, we already have teams in the local authority that manage marine assets of different types. We want the net revenue that comes from the management of those assets to go back into the communities and for them to decide, to a large extent, whether that investment is for onshore infrastructure or managing the asset through persuading those who are involved, such as aquaculture organisations, to manage their processes in a sustainable way within the local context.

If the net revenues from the Crown estate go to local government, we will not be interested in using that to deliver services. We are looking for investment in the Crown estate, which has not happened in the past. Communities are crying out for that. We need to be clear about distribution.

Mark Ruskell

Are you saying that that will be the case even if the devolution of management puts pressure on your teams?

Councillor MacDonald

The greatest pressure on our teams is their inability to deliver on the aspirations of local communities because of the financial resource that they have.

Dr MacLeod

The 9 per cent figure is curious and intriguing in some respects. Although it has not quite been plucked out of the air, it is a historical figure. I am not clear about the rationale for it.

Andy Wells

It is because the Crown Estate cannot borrow money. There has to be a method by which it can generate capital for reinvestment other than through sales of land.

Dr MacLeod

Thank you for that helpful clarification.

That being the case, there is nevertheless an issue around the incentivising of communities to become managers of assets and whether there is scope to change that figure. We do not have a figure in mind either, but it should certainly help to do that. When David Mallon gave evidence to the committee on 20 February 2018, he said that 9 per cent is “a game changer” for communities. Perhaps it is, and I do not want to dismiss that, but it could be even more of a game changer if it was a larger figure.

There is also an interesting question about what happens to the 91 per cent that goes back into the Scottish consolidated fund. From Mr Mallon’s evidence, I gathered that there is some ambiguity around whether there is scope to redirect that money from the fund back into communities. If that is the case, we would be interested to hear how it might happen in practice.

The Convener

I have a wrap-up question that I would like to pose to all the witnesses. I am looking for brief answers. Do you have any views on potential omissions from the bill or suggestions for how it should be amended, other than the ones that we have already discussed?

Dr MacLeod

We have a couple of suggestions in areas in which we think that there are opportunities. One suggestion relates to an automatic right of ownership of the foreshore. When communities are not in a position to take on ownership, the right would go to local authorities, which would enable communities then to take that on. In our written evidence, we also made a suggestion relating to the scope for community ownership of areas of the sea bed that are in the proximity of foreshore rights. I will not rehearse all the arguments that we have heard already, but that suggestion relates to sustainability and community cohesion.

The Convener

In real terms, what would be the benefits of both those options?

Dr MacLeod

They would give communities more control and more say in what they might want to do with the assets for the benefit of the communities. There would be potential economic benefits and other broader sustainable development benefits in terms of social cohesion, community confidence and helping communities to thrive.

The Convener

Mr Wells, how would you see that happening in practical terms, given your inside knowledge of the Crown Estate?

Andy Wells

It is about balance. From our perspective, we think that the bill offers a real opportunity for people and communities to have more opportunities to get involved and have a say in how assets are managed. It is a matter of striking the right balance between empowering communities and ensuring that there is accountability and that the right systems are in place.

The Convener

I will not be unfair and ask you whether the bill can be improved, given that you are here to represent the Crown Estate. That would perhaps be unkind.

Alex Kinninmonth

On sea bed ownership, it is recognised that Scotland’s territorial sea bed is of national importance, which is why we are happy to support the presumption against the disposal of that asset without safeguards. Given that there is quite a strong consensus on that presumption, there is scope to make the bill slightly stronger. As the bill is drafted, it is at the discretion of ministers to consent to disposal of the sea bed against an unknown set of criteria. We should either be clearer about what the set of criteria is or we should make the sea bed in effect inalienable—it should be unable to be sold or Parliament should have a greater role in deciding when and where it should be sold.

Audrey MacIver

From an industry and sector development perspective, as well as the further devolution, the bill should illustrate how Crown Estate Scotland can continue to play a vital role in stimulating innovation and supporting technology and development, whether in offshore energy or aquaculture.

Councillor MacDonald

On the point that Alex Kinninmonth raised about ministerial discretion, it would, I hope, be reassuring if there was some clarity on the criteria that are to be used. No community will take on the management of Crown estate assets if there is no benefit to it in doing so. Nobody will take on the management of an asset if it is not an asset but a liability. We should ensure that safeguards are in place so that the process, whereby people take control of the management of assets and the revenues that go with them is very clear and regulated at different levels.

The Convener

Thank you all for your evidence, which has been very useful.

I suspend the meeting for a couple of minutes before we move to the next item.

11:08 Meeting suspended.  



11:15 On resuming—  



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Fifth meeting transcript

The Convener

The third item on this morning’s agenda is evidence on the Scottish Crown Estate Bill. We are joined by the cabinet secretary, Roseanna Cunningham, and her officials Douglas Kerr, David Mallon and Mike Palmer. Cabinet secretary, do you wish to say anything at the outset before we move to questions?

Roseanna Cunningham

Yes, convener. I have an opening statement for this agenda item. To set the generality, the Scottish Crown Estate Bill proposes new powers for the Scottish ministers to change who manages Scottish Crown Estate assets and opens up the possibility of local authorities and communities taking control of the management of those assets.

The Crown estate consists of a diverse portfolio, including thousands of hectares of rural land, half of Scotland’s foreshore, urban property and sea bed leasing rights for activities such as renewable energy. We quite quickly came to a view that a one-size-fits-all approach was simply not practical. Therefore, the bill lays the foundation for changes in the management of individual assets. We want to maximise the benefits of the Crown estate for communities and the country as a whole, while ensuring that assets are well maintained and managed with high standards of openness and accountability.

I know that the bill and the proposed arrangements for the Scottish Crown estate are complex, so it is understandable that there will be some misunderstandings. With that in mind, I thought that it might be helpful if I explained how we see the financial flows working, and I hope that members have had circulated to them our attempt to produce a paper that allows a simple explanation in flowchart form. How effective it is will be for members to decide. The paper has not been circulated as a basis for members’ questions so much as with a hope that, by putting it into that form, we have made life a little simpler in terms of understanding what is happening.

The first and most important thing for everybody to understand—by “everybody”, I mean those beyond the committee, given that the committee knows this already—is that the Scottish Crown estate has not brought any new money into Scotland. The UK Government’s block grant to Scotland has been reduced by the estimated annual amount of net revenue earned by the Scottish Crown Estate assets. Under the terms of the Scotland Act 2016, the net revenue from the estate—the income from leasing, licensing and all the other Crown Estate Scotland activities, minus the costs of managing the assets—is paid into the Scottish consolidated fund. We are clear that whoever manages the assets has to

“maintain and seek to enhance”

the value of those assets and the income arising from them, otherwise Scotland as a whole is out of pocket.

However, the money that is earned by the Scottish Crown Estate assets can now be used differently. The net revenue that is generated by the marine assets out to 12 nautical miles will be disbursed to the three islands local authorities and the other 23 coastal local authorities. The local funding will not be hypothecated, but we would expect the local authorities to be transparent and accountable to their communities on how that money is spent. We are in constructive discussions with the Convention of Scottish Local Authorities on an interim mechanism for local authority areas to receive a share of the revenue, and we expect to reach agreement on that soon.

As members know, the bill places a duty on the manager of an asset to

“maintain and seek to enhance”

the value of the asset and the income arising from it. When the management of the Scottish Crown Estate assets was transferred to Scotland, we inherited the pre-existing arrangements, which mean that whoever manages the assets—currently, it is Crown Estate Scotland (Interim Management)—can retain 9 per cent of the gross revenue for investment in the estate, for example for renovations and repairs to farm buildings or the purchase of new assets. Thus, before the net revenue is surrendered by the manager to the consolidated fund, the 9 per cent figure is subtracted. We are keeping that facility in the bill, but we are taking the power to be able to vary in the future the percentage that is subtracted. It might be that some assets need more capital investment than others and that provision in the bill will allow a more responsive approach to be taken.

That is not the only way in which managers will be able to invest in the assets that they manage. At present, the Crown estate is managed as a single estate, although there are many different types of assets. If one part of the estate is not earning enough income to cover its maintenance and management costs, it can be subsidised by the better-performing assets, which we all know as cross-subsidy. We want to keep the ability to cross-subsidise even when there are several managers of the assets. We are taking powers to enable ministers to direct a manager to transfer a sum of money from their account to another manager’s account. In that way, a community organisation should be able to take over the management of a local asset, even if the asset will not in itself generate enough income to cover costs. To be clear, that money would come from a manager’s Scottish Crown estate accounts and not from a manager’s personal accounts. The bill requires a strict separation between a manager’s Scottish Crown estate accounts and any accounts of the manager’s own.

11:15  



The bill also sets up a national governance framework that will specify accounting and reporting procedures that should result in openness and transparency about the management of the assets, whether they are managed locally by communities or nationally by Crown Estate Scotland.

I put that statement firmly on the record because there is a bit of confusion out there about what exactly is going on with the devolution of the Crown estate to Scotland.

The Convener

We will cover some of that as we go along.

To kick off, I have a question about the bill’s vision and purpose. If we came back here five or 10 years from now, what would be used to judge whether the bill had been a success? What would we look for the Crown estate to have delivered for Scotland?

Roseanna Cunningham

A lot of things could be referred to but, ultimately, the aim is to ensure that the Crown estate operates to the benefit of Scotland and its communities. There has been a long history of concern that the Crown estate has not functioned with community interests at the forefront. That is an old criticism, which the committee’s predecessors took up.

The benefit to Scotland is financial, as I outlined, but it is also socioeconomic and environmental—it encompasses everything. We will look for managers, whoever they are, to emphasise the wider benefits more when making decisions.

In five or 10 years’ time, I hope that at least some local authorities will have taken over direct management. At the moment, most of the interest is from a handful of authorities, such as Orkney Islands Council, Shetland Islands Council, Western Isles Council, Highland Council—perhaps not even that one—and Argyll and Bute Council. Other coastal local authorities have not expressed a strong interest.

Five or 10 years into the future, I hope that more coastal local authorities will have considered and taken on management, and I hope that more community organisations will have done so. I do not want the conversation to be just about devolution to local authorities; it is also about communities. In five or 10 years’ time, I hope that a number of communities will have taken on management, because communities in particular felt that their interests were not being taken into account.

In my opening statement, I outlined the net revenue issue. In five or 10 years’ time, I very much hope that the Crown estate will be contributing to, and not a drain on, the Scottish consolidated fund. That is a fairly fundamental point. I hope that local authorities will use the net revenue from the marine assets out to the 12 nautical mile limit to benefit coastal communities, which is why I made a point about transparency and accountability. We will not hypothecate the money, but its purpose is to enhance coastal communities. In five or 10 years’ time, I hope that a significant percentage of Scotland’s coast, if not the whole coast, will be tied up in such a way.

I am sorry if I went on too long.

The Convener

Not at all—you have led into my supplementary question, which I ask with my constituency and area hat on. You talked about local authorities securing funding that they have not had in the past and about transparency and accountability. I do not want to put words in your mouth, but would you expect a local authority that inherited a sum of money from such a coastal source to deploy it to address issues such as coastal erosion?

Roseanna Cunningham

A coastal local authority might very well want to consider that. Depending on which local authority we are talking about, there will be different drivers for what it wants. However, the expectation from the Government—as well, I suspect, as from the people on the ground—is that the money that any local authority obtained through the mechanism would be used for the betterment of coastal communities in some way. The amounts of money that are transferred will be transparent—you will know exactly what the money is—so everybody will be able to track how they are spent. I suspect that it would not be a wise move for any coastal local authority to displace that money elsewhere.

The Convener

Would it be a recurring sum of money as opposed to a one-off payment?

Roseanna Cunningham

It would be an annual process. The amount of money will not be exactly the same every year, but it will be roughly the same. There will be a short-term, interim distribution mechanism to get us over the first year or two. The form of distribution may change but there will be an understandable, logical calculation that people can see and significant and specific amounts of money will then emanate from that to each coastal local authority.

The Convener

You indicated that there is dialogue with COSLA on that. How soon are we likely to get an indication of what the sums of money would be or of the distribution mechanism?

Roseanna Cunningham

I do not know whether they have had time to do it, but I have asked officials to give us an indication of what it might have looked like last year or the year before on the basis of some of the distribution models that we are discussing for the interim process.

We are still hashing out with COSLA what the final distribution model will look like. I do not know how close we are to determining that. It is a difficult one to gauge. Let me put it this way: the first calculation for payment for the year 2019-20 will be next March. For understandable reasons, that will, of necessity, have to be on an interim distribution model. However, the fact that the payments are annual is a pretty big incentive to stay at the table until a decision is properly made.

The Convener

You can provide us with information as it becomes available, cabinet secretary.

Roseanna Cunningham

Yes; we will do that.

John Scott

You said that, although the Crown estate is a contributor to the consolidated fund at the moment, you hope that, in future, it will not be a drain on that fund. Given the expectations that have been raised, is there a real risk that there will end up being a net loss?

Roseanna Cunningham

No; I do not think that that will be the case in Scotland-wide terms. However, that is why we want to retain the cross-subsidy. It would be difficult to say that the new managers will have to run some specific assets at a profit when that has not been the case before because those assets were cross-subsidised. That would be an unfair imposition.

Maintaining the cross-subsidy enables us to even out profit and loss across the whole estate. I know that there have been debates about what aspects of benefit are important, but that shows why getting value out of the management of the estate is important. Rather than it being a risk that there will be a net loss overall, the issue might be that people who are managing a local asset forget that they are parts of that national figure. The danger is that they become so focused on their issue that they stop seeing themselves as part of the national picture.

The money is not new. Although it is coming in to the consolidated fund, money has been removed from the fund in anticipation of that. It is absolutely imperative that everybody who manages a Crown estate asset, whether that is Crown Estate Scotland, local authorities or communities, does so to the very best of their ability, with the outcome of success at the forefront of their mind.

John Scott

Notwithstanding that, it appears that there is a risk that the Crown estate will not be a net contributor to the consolidated fund. However, I will move on.

I declare an interest as a farmer. On the management of assets at national and local levels, in its consultation on the long-term arrangements for the Crown estate, the Scottish Government set out a table that indicated at what geographical level it considered different assets would be managed most appropriately. Does the Scottish Government still hold broadly the same view on that matter as it did at the time of the consultation? What is the Government’s view now on the assets that, at the time of the consultation, needed more consideration?

Roseanna Cunningham

I do not think that we have made final decisions on the asset split between national and local levels. What we indicated at the outset is sensible and likely to be the basis on which we move forward. We have already had a conversation about not all assets perhaps being sustainable in their own right, and I do not want financial burdens to be placed on communities or local authorities, which would be invidious. Notwithstanding John Scott’s pessimism, I do not see from the national picture there being a risk in that regard. It would be an unfair imposition to put people or organisations in a position in which they have to manage assets that are not sustainable in their own right. What we are doing will give us good information on whether some assets are likely to require cross-subsidy. We should not forget that we have not really looked at Crown estate finances in this level of detail in the same way before.

From a practical management point of view, some issues need to be taken on board. We consider there to be a case for the management of the sea bed, particularly the 12 to 200 nautical mile zone, and leasing for strategic national infrastructure, such as telecoms, cables, pipelines and so on, to be undertaken at the national level. We also heard, as did the committee, very strong submissions from tenant farmers on the Crown estate’s landed estates on what they wanted to happen. We have responded by taking the view that, at this stage, management of those estates should be retained as part of the national management of the Crown estate. That position could change only if the people who are involved actively in the farming on those estates wanted there to be some change and, at this point, there is no indication that they want any change.

John Scott

Thank you very much.

Roseanna Cunningham

I am sorry—I have just been handed another note. I am being reminded that the rising income for renewables will mean that overall net revenue is expected to increase; we are back to John Scott’s very pessimistic outlook on the overall picture.

I also flag up that we might charge some assets at less than market value, but overall it is not expected to balance out as a drain. We will keep a constant eye on the matter anyway.

The Convener

That is the expectation but, of course, that is determined by external factors. For example, offshore wind development will proceed only with contract for difference support, so there are factors at play over which you have no control.

Roseanna Cunningham

There might be, but that is the purpose of the way in which we have set up the system.

Mike Palmer (Marine Scotland)

On the risk of a drain on the Scottish finances, I remind the committee that section 7 will place a clear duty on each manager to

“maintain and seek to enhance”

the value of the assets, which reflects the importance that we place on the financial efficiency of the Crown estate in Scotland.

11:30  



John Scott

In that regard, promises appear to have been made and expectations appear to have been raised that much of the income from the Crown estate will now go to local communities and councils. There is a job to be done on managing expectations.

The Convener

We will come to that in due course.

John Scott

Thank you for reminding me, convener.

The Convener

I will let Mr Stevenson in on that point.

Stewart Stevenson

I will ask a question about the managers who take over from the Crown Estate, particularly those who represent community interests. In what has been said, it has been recognised that some of the assets that will be managed by community bodies are, in accounting terms, liabilities. Under section 7, managers must maintain the value of the asset, but there might be very limited opportunity to seek to enhance it.

I will ask an accounting question. I presume that the community body will be a limited liability company or be registered as a charity—it will have some formal structure. How will it deal with the fact that its only asset is, in fact, a liability in accounting terms? Who stands behind it to ensure that it meets the legal requirements for it to balance its internal books?

I think that that is a question for Mr Palmer, but I could be wrong.

Roseanna Cunningham

I am definitely not doing accounting questions.

Mike Palmer

I will have a first stab at answering; David Mallon might want to come in on some of the detail.

There would be a separation between the Crown estate elements of that organisation’s accounting and any other elements. It is important to understand that at the outset.

Stewart Stevenson

That goes to the heart of my question. The Crown estate part is separate and separately accountable but, in some cases, will never be anything other than a drain and there will be no expectation that it will be otherwise.

Roseanna Cunningham

That is why we want to maintain the cross-subsidy.

Stewart Stevenson

I understand that point. I am only asking about what happens in accounting terms. Does that mean that the cross-subsidy has to appear as an asset for the organisation and, therefore, it needs to know what it is before it gets it?

Mike Palmer

I defer to David Mallon on that.

David Mallon (Scottish Government)

I will attempt to answer the question. It is a hypothetical question and there is a prior question about whether it would be wise to give a loss-making asset to another body. There may be situations in which that is considered a good thing to do.

In accounting terms, the cross-subsidy is an important part of the framework because the accounts of that manager would show not only what income it received directly, but where there was an injection of funding through the cross-subsidy arrangements to enable there to be a zero balance sheet from year to year. The accounting is designed to be flexible to take account of that scenario.

When it comes to the duty in section 7 to

“maintain and seek to enhance … the value of the assets”,

if the income is zero at present, it is not too challenging to maintain it at that level. Indeed, it might be that the asset has just been underutilised to date because the national manager has focused on bigger assets. Through further devolution, a local community organisation might be able to make more of that asset and, therefore, potentially enhance the value.

Stewart Stevenson

That is fine but there will be assets that will always be a negative that you might feel would be better managed by the community but not necessarily to the extent of becoming positive income generators. Who bears the liability, ultimately? In other words, to where does that liability transfer? Is it consolidated with Crown Estate Scotland’s accounts or the Government’s? Obviously, in the circumstances that we are discussing, what appears on one balance sheet as a liability has to appear on another balance sheet with the opposite sign.

David Mallon

That brings in the concept of the Scottish Crown estate. The cross-subsidy could be provided by Crown Estate Scotland, or it could come from another manager on the Scottish Crown estate. In such scenarios, the liability would be covered by the Scottish Crown estate, rather than the community organisation.

The Convener

Mr Stevenson took us off on a slight tangent—

Stewart Stevenson

As he does.

The Convener

We will stay with the subject for now. Do you have a clear picture of Crown Estate Scotland’s liabilities as things stand?

David Mallon

Before the transfer on 1 April 2017, quite a lot of work was done to better understand the liabilities. In simple terms, they boil down to landlord responsibilities and employer responsibilities. The landlord responsibilities form the more unusual aspects of the liability question; they split into contingent liabilities and residual liabilities.

Contingent liabilities refer to the expectation that, after part of the estate has been used, the landlord will restore it to the condition that it was in before. Through a lease agreement, the requirement to restore is normally for a developer—for example, if farmland were used for mining activity, the developer would be expected to restore the land to a condition that was fit for farming or another use.

Contingent liabilities sit with the manager, because of the possibility that a developer might not be able to honour its undertakings. If that were the case, Crown Estate Scotland, as the landlord, would be expected to pick up the cost.

Residual liabilities arise after an activity has been decommissioned. The Government is responsible for ensuring that a decommissioning scheme is in place for a wind farm, for example, and it is for the developer to complete that scheme. However, at the time of decommissioning, the developer might get approval not to remove all the infrastructure from the marine environment, so some infrastructure might remain in the water. If a third party incurred damages because of that, residual liability would exist.

Those are the main liabilities. There are also less expensive ones, such as maintenance of property and stewardship of the estate.

The Convener

I will come to that; I note that Mr Stevenson is champing at the bit. A subjective element must exist, because although a tenant farmer’s view might be that there is a backlog of repairs, Crown Estate Scotland might not entirely share that view. It must be difficult to gauge the level of liability entirely.

David Mallon

A difference of opinion might exist, and the estimation of future requirements needs assumptions to be made. A lease agreement between a farmer and Crown Estate Scotland normally makes it clear what Crown Estate Scotland’s responsibility is and what the farmer’s responsibility is. There is usually a mixture of both aspects, but the agreement has clarity. A farmer might sometimes feel that something is for Crown Estate Scotland to undertake, when in fact Crown Estate Scotland has written it into the agreement that it is for the farmer to undertake. However, dialogue usually takes place between the two parties to try to resolve the situation.

John Scott

In its submission, Scottish and Southern Electricity Networks said:

“Asset managers should be responsible for the liabilities associated with their assets”,

while Community Land Scotland suggested including

“provisions enabling Scottish Ministers to assume responsibility for liabilities”

when communities manage or own assets. Which view does the Government prefer? When devolving power to community groups, should the Scottish ministers assume responsibility for potential liabilities?

Roseanna Cunningham

We have included in the bill a power for ministers to assume responsibility for potential liabilities when we devolve assets to local community groups, but we would consider that case by case. We would not want to proceed that way across the board. That is one of the matters that would be weighed up when the application is made, at which point we would look into all the facts and circumstances around a community group that wished to take over the management of an asset.

John Scott

On a bigger scale, I think of the East Ayrshire coalfields, for which East Ayrshire Council created insufficient bonds, as I recall. There was a huge liability for the extraction of coal when all of that went terribly wrong. Do you envisage a system of insurance such as bonds being established by the bodies that use the assets?

Mike Palmer

In essence, the bill proposes that such cases be taken case by case. A judgment would have to be made on each business case. In most cases of a community organisation or a local authority making a proposal to manage an asset, we would expect both the assets and liabilities to be transferred to them.

One would normally expect that that would be an incentive behind the organisation’s business case. We would not particularly expect organisations to wish to manage an asset for which they were at risk of taking on liabilities that they did not feel that they could deal with and for which they might need to get into some complex arrangements for bonds. However, we are trying to set up a discretionary system that is open to any kind of case being made. Each case would need to be considered in the round. Issues such as whether it is reasonable for liabilities to be managed away from that community organisation at a more national level and whether that can be agreed to would need to be considered at the point at which the case was advanced.

Roseanna Cunningham

Basically, the presumption is that the liabilities would pass to the new managers along with the asset. That would be the norm and I expect that that would happen without much discussion or conversation in the vast majority of cases. There may be the odd occasion when a bigger conversation about liabilities has to be had and we have allowed for that. However, the presumption under which we operate is that organisations will take on liabilities as well as the asset, which is what you would expect in the normal course of events.

John Scott

Absolutely. I just want to be absolutely clear about who the banker of last resort is for the once-in-a-generation, inadvertent liabilities that emerge and could not have been foreseen. I presume that it is the Scottish Government.

Roseanna Cunningham

Those are issues that we have to deal with all the time. It is a conversation that we have to have in Government across a range of matters, not just the Crown estate. We are talking about trying to put in place a system in which there is a presumption that liabilities will transfer with assets. That is how it will operate unless there is a very particular set of circumstances. No legislation can legislate for the unforeseeable.

Stewart Stevenson

I have a small question about what Mr Mallon said about the decommissioning of marine assets. The phrase used was “residual liabilities”. I do not recognise that phrase; I recognise only liabilities and contingent liabilities. I presume that we are talking about those being contingent liabilities—in other words, there being no liability until a future contingency occurs—therefore they would not have to be in the numbers and provided for financially by the manager, although there would need to be reference to that in the notes to the accounts.

11:45  



David Mallon

You are right that the liabilities are all either residual or contingent—they are all theoretical rather than actual liabilities. To clarify, “residual liability” is a phrase that has been used by the UK Government in the decommissioning schemes for offshore renewables, which—

Stewart Stevenson

Okay. My point is that it is not in the international financial reporting standard.

Claudia Beamish

I seek a brief clarification on the support for community ownership. Organisations such as Community Land Scotland have welcomed the inclusion of community organisations as potential asset managers. What will community organisations need to do to prove that they are capable of running a Crown Estate Scotland asset? What support will CES and others provide to them? What monitoring will be provided to ensure reassurance and to allow community organisations to be in control?

Roseanna Cunningham

First, we should remind ourselves that it is not ownership of the Crown estate that is being passed over, but management. I worry a little when a shorthand is used that makes it sound as if, somehow, ownership is involved in this.

I very much hope that communities will step forward and take over local assets because, as I said in my opening remarks, in the past, communities were most critical of how things were managed—they felt that things were not managed in their specific interests. Members will also be aware that pilot schemes will be launched, and we will follow their progress and how they work pretty closely. The experience of the pilots will inform some of the decision making on transfer and delegation.

We have in place the existing capacity to support communities at an early stage, in the same way that we support those who come forward with the intention to register an interest in community right to buy. If anyone has been involved with a community that has done that, they will know that an enormous amount of support from officials is available at a very early stage in the process to ensure that a community’s application is in the best shape that it can be. We want to build that into the system for communities becoming asset managers, so that communities that come forward with an idea can have an early conversation and get early support in how they should proceed. I think that I am right in saying that grants will be available to communities that want to come forward with an application, in order to help with their capacity. If I can find the specifics on that point, I will provide them. There will be financial support.

From my perspective in knowing about communities that have wanted to progress a right-to-buy application, the more important support is the support that communities get from officials from the outset to help them through the process. One of Crown Estate Scotland’s jobs will be to be as facilitative as possible with communities that express an interest.

I am just being reminded that section 31 of the bill provides for grants for preparation for management changes.

Different kinds of support will be available for communities and it will be interesting to see how many step forward. Some communities, as opposed to local authorities, have expressed an interest, but not an enormous number. Perhaps publicity about the bill going through Parliament will mean that other communities begin to think about the issue.

Claudia Beamish

I do not want to sound too negative, but I need to ask what would happen if things went wrong with assets that had community managers. The same answer might apply to every other manager that takes on Crown Estate assets.

Roseanna Cunningham

We very much hope that things will not go wrong, although occasional hiccups are in the nature of things. Crown Estate Scotland and we as ministers will look closely first at defining wrongness. Our earlier conversations were about a community taking on something that can make money or being prepared to take on something on the off-chance that it might make money, which is in a slightly different category. In those circumstances, what is the wrong thing?

The nuclear option would be to take back management from an organisation. We would try not to be in that position, if possible, but we have provided for it if needs be. The bigger picture about financial viability and the Scottish consolidated fund will be the final red line that we must keep in mind.

John Scott

The cabinet secretary will be aware that the committee carried out a confidential survey of all Crown Estate Scotland (Interim Management) staff to seek their views on the bill. Staff expressed many fears in the survey, such as fear of fragmentation, and a number of people said that they believed that the bill would lead to their jobs being lost and made other comments that were not very positive. What reassurance can the cabinet secretary give the current staff?

Roseanna Cunningham

Change always creates uncertainty and I do not expect Crown Estate staff to be excluded from that feeling. They know that the way in which they work will change. However, as we have discussed, the staff will have a continuing role for the foreseeable future. I have taken the time and trouble to visit them on a number of occasions, because I was conscious that the policy change could take place without reference to them at all—although that is not how we have proceeded. I very much hope that potential new managers will think about that aspect, as we have done.

The uncertainty is of the nature that arises whenever change is coming, regardless of what that change is. I suspect that the continued retention for national management of a significant part of what the Crown Estate does will mean that the change is far more minimal than staff might have feared at the outset.

Whatever the concerns about the fragmentation of management were, the experience so far has been that the number of bodies that are prepared to take on management and are asking about the transfer of management has not been as high as I expected. The attractiveness of the option for some organisations and local authorities remains to be seen. We could be many years down the line before the final verdict is passed on internal devolution of the Crown estate.

John Scott

I am sure that the staff will find that reassuring. Do you envisage any jobs being lost? Is a policy of no redundancies in place?

Roseanna Cunningham

We will ask Crown Estate Scotland to comply with the policy. It is not legally obliged to comply; it is one of the groups that can choose to comply. Most of the bodies that are not legally obliged to comply do comply. We will look at that.

It is obvious that I cannot foresee the future. It is important to remember that staff terms and conditions always need to be borne in mind and that contractual arrangements such as pension provisions absolutely have to be catered for.

I hope that the change will have as little impact on staff as it can. How things are managed will change, but reference has been made to the feeling that the management of smaller community facilities has not been as hands on as it might have been, which we hope that the internal devolution of management will change. I do not see that having a significant impact on the staff in Edinburgh.

John Scott

I hear what you say, and I am sure that you would seek to allay staff fears, but it appears from what you have said that a preponderance of other experts will be invited to advise communities and local authorities on how to manage assets. What will be the role of those in Crown Estate Scotland who have hitherto managed those assets? Given that they will no longer deal with those assets, how will their jobs change?

Roseanna Cunningham

I know of no organisation anywhere in the country that does not have to deal with change at some stage. That applies to Crown Estate Scotland as it does to anywhere else. Perhaps the way in which management is done will change. The body will still produce a strategic plan, and significant parts of the Crown estate are likely to remain under national management.

To be honest, I do not foresee an enormous amount of change for the staff in the foreseeable future. Can I promise that there will be no change for any staff at any point? Of course I cannot, but I cannot say that about any organisation. In that sense, Crown Estate Scotland’s position is no different from that of other organisations that are in the purview of my portfolio.

The Convener

We will move on. I remind members that we still have a lot of ground to cover.

Claudia Beamish

In parallel with the financial obligations, which we explored in considerable detail, there are the wider social, economic development and environmental duties on which sections 7 and 11 focus. The cabinet secretary will know that the committee has heard no outright opposition to the inclusion of the wider duties that those sections highlight, but some stakeholders have called for the duties to become mandatory or for the wording to be strengthened. Some have argued for the word “must”, which is used in connection with the financial obligations, rather than the word “may” to be used. Should the wider duties be mandatory? How could they be strengthened?

Roseanna Cunningham

I gave a fairly reasonable explanation of why we chose to make the financial duty mandatory, because of the pretty significant impact. When we talk about a mandatory duty to maintain the value of an asset, it is also important to communicate to managers the fact that their fulfilment of that duty includes the promotion or improvement of the socioeconomic factors that section 7 lists. That provides a good reason for using the terminology “may” rather than “must”. In many instances, such factors have to be borne in mind to maintain the value, which is a must.

The duty in section 7(1) is not to maximise value but to maintain value and, where possible, improve it. I do not want there to be a false understanding that it is a duty to maximise value at the expense of everything else. That is clearly not what we have in mind, as is borne out by the language of the bill.

It is also important to see this legislation within the broader context of the principles of sustainable development. Crown Estate Scotland has been asked to look at that extra line and it is working with it effectively so far. We think that that will continue to be the case.

At the moment we do not feel that we need to make everything a “must” in the way that some have suggested. For the reasons that I have already given, we do not see the conflict that some people see. In order to maintain and improve the value of assets, some of those other things will have to be brought on board anyway.

12:00  



Claudia Beamish

If that is the case, surely the use of the word “must” should be considered in relation to environmental duties, for example, as the Crown estate is a public interest.

Roseanna Cunningham

Any environmental duties that are imposed by statute will have to be complied with anyway; managers are not exempted from any of those formal duties.

Another of the issues that we need to take into consideration is that those factors might not be relevant to absolutely everything that a manager does. If we use the word “must”, and a manager then has to take into consideration something that is not relevant to a particular decision, that becomes an exercise in futility. I do not see that particularly helping managers to make the decisions that they need to make.

In truth, the reason why communities will want to take on the management of the assets will be to maximise a range of benefits. The traditional criticism has been that that has not happened. We are not in a position to judge whether that is a fair criticism, but the precise reason why communities will want to take on the management is to maximise a range of benefits. I do not see those things as being in conflict.

Mark Ruskell

I return briefly to the points that you made in your opening statement about disbursing net revenues to communities. Would you like to add anything more about the process and the mechanism for doing that? For example, is it the intention that some of the financial benefits to communities will go through participatory budgeting, or could they go through council budgets? Are there any restrictions on that? Do you have any thoughts on how that should or should not be done?

Roseanna Cunningham

The point that I made in my previous remarks is that, however the distribution is done—whatever the calculation and the formula for that distribution will be—the money will not be hypothecated, because of the nature of the settlement that we have with local government.

However, the amounts of money that will be involved will be known. I anticipate that any managers—in this sense, we are talking mostly about local authorities—will want to account for how they use that money. How they choose to do that is a matter for them. At the moment, we are not thinking about mandating a mechanism by which a local authority makes its decisions about what it considers the best way to spend that money, but we expect the money to be spent for the betterment of coastal communities, however that might be defined.

Given the nature of the local government settlement, I do not think that it would be right for us to send the money to local authorities and attach a set of strings to it. Doing that would require a change in the way in which the relationship between the Government and local authorities works. However, the amounts of money that will be sent to local government will be known. I hope and expect that people will hold their local authorities to account on spending that money.

John Scott

I turn to the 9 per cent figure. Thank you for the revenue chart that you helpfully provided. My question is simple: should Crown estate asset managers be able to retain and invest more than 9 per cent of the revenue that they earn? How do you see that story unfolding? You have said that you expect to introduce flexibility to the 9 per cent figure in the bill.

Roseanna Cunningham

Yes. That relates to the flat rate that comes with devolution. The flat rate is applied by the UK Government to the Crown estate in the UK as a whole, and it will be applied to what will be the residual England and Wales Crown estate.

Our view is that we should start with 9 per cent, simply because that is what is used now, but we will keep the situation under review. We will consider whether 9 per cent should apply across the board or whether there might be occasions on which we should allow managers, depending on the area and the asset, to retain more than 9 per cent, because more management might be required for some assets than for others. However, that means that the likelihood would be that other managers would get to retain less than 9 per cent. It is not just about retaining more, because in some areas the management function might not be as great and, therefore, the figure might be less than 9 per cent. All that we are doing is trying to retain flexibility so that we are not tied across the board to the 9 per cent figure, which might not apply in every case.

That approach will enable us to respond to the different kinds of management that there are. I refer back to our earlier conversation: a community group that wants to step up might think, “That asset is not generating what it could for the community. We think that we can do better, and we want to set out a plan that does that.” In such circumstances, the Government might take the view that the community group would be able to retain a greater percentage because it would be putting more effort into the management compared with a different group that might just want something to take over. It is about allowing ourselves flexibility.

We do not have any immediate plans on the issue; I have nothing in mind at the moment. The 9 per cent figure is what we will inherit, and it would be a big thing to axe when we might be able to deal with the issue more flexibly.

John Scott

I appreciate the need for flexibility. I understand perfectly well that the figure will depend on good years, the income that is available to managers, the need to return money to the Scottish consolidated fund and the potential to invest more in the Scottish Crown estate.

My second question is, if the Scottish Crown estate becomes fragmented, and if a higher proportion of asset managers are able to retain a higher proportion of their revenues, rather than the Crown estate managers retaining them, what impact will that have on the ability of Crown Estate Scotland to invest in, for example, farms in the rural estate?

Roseanna Cunningham

That is a specific example of why we want to retain cross-subsidy. As unpopular as it might make a minister to step in and tell one set of managers that they will have to transfer money to another set of managers, that is nevertheless how we wish to be able to proceed, because otherwise the estate as a whole would begin to be in difficulty. The cross-subsidy part of the bill has been well understood. There has been an active stakeholder advisory group all the way through the process and we have never hidden that part of the conversation from them, so people are well aware that that is a possibility.

Finlay Carson

Bearing in mind that we have already discussed the cross-subsidies, how will the potential impact on other assets be taken into account when you are making the initial decision to transfer or delegate the management of assets? If you have to make a decision on transferring assets, what part will those considerations play?

Roseanna Cunningham

Do you mean what part they will play if I have to make a decision about a community taking on responsibility for management?

Finlay Carson

Yes.

Roseanna Cunningham

I was using the word “transfer” in a different sense.

Finlay Carson

Cross-subsidy is one way in which we can support the non-profit-making parts of the estate; will you assess the potential financial impacts prior to transferring or not transferring the management of an asset?

Roseanna Cunningham

Every single one of the applications for taking control of management of an asset will have to be looked at carefully on its merits. There will be a lot of factors to be considered, and that may be one that we will look at. As discussed with John Scott, it may be the case that some organisations, whether they are community organisations or not, will feel that they can make a far better fist of running an asset than has been the case. If so, they can turn an asset into one that does not need transfers of money in but which might be in a happier position in a few years’ time.

That is a conversation that we would need to have with the organisation at the time of application, because we expect people who come forward to consider taking on the management of assets to have a clear plan and proposals. It is not simply a case of signing a brief form and getting the management transferred; it is too important for that. That will be part of the conversation. If the asset is one that the prospective managers do not realise is not actually making money, they will be made aware of that as part of the application.

My officials are reminding me that managers, or prospective managers, will have to show three-year plans, so when we are talking to people about taking over management, they need to be thinking about it not just on day 1, or even six months down the line, but over the whole period. All of that will be part and parcel of the conversation. I anticipate that it will sometimes happen that a group comes forward and then decides that there is not as much potential in the proposition as it thought there was. I hope that we will also get communities that come forward and say, “Look, we want to do this, because we think it could be better run, and here’s why, and here’s our plan for how it can be better run.” That is a conversation that I hope that Crown Estate Scotland will be having with more people, rather than fewer people, and it will turn assets into income-generating assets, rather than those that do not generate income. That does not necessarily apply to some of the bigger assets, but it might in future.

Finlay Carson

Has any thought being given to the idea that there may be parts of the estate that you do not want to allow communities to take over because they are key to the overall performance of the estate and its ability to support those parts of the estate that are not so viable?

12:15  



Roseanna Cunningham

We have not looked at it in quite those terms. We have been thinking about national strategic priorities and the pressure from the tenant farmers in the four tenanted estates. Rather than considering the issue from the perspective of whether an asset is income generating or not, we have been thinking about the bigger picture and considering what is a more appropriate approach. It is perhaps understandable that things such as the big telecoms and renewables should not get chopped up, because it would be harder to see how they would work if they were chopped up and they are also some of the really big income-generating sectors.

We must not lose sight of the fact that although we might want to focus on smaller assets that are not such big income generators, there are some big income generators in the mix. That is why it was important to keep the cross-subsidy idea. There will also be a strategic management plan to give a national perspective. We are not losing sight of the bigger picture in the individual conversations that we are having.

At this stage, I do not have a clear idea whether the Crown Estate could point to every single asset and say with certainty whether it was income generating. That information will probably emerge over the next year or two. I make a shrewd guess that it will tend to be the smaller assets, which are more localised, rather than the bigger, strategic ones that are considered. However, that is a guess at this stage.

Angus MacDonald (Falkirk East) (SNP)

Historically, the coastal communities fund has been tied at UK level to revenues generated by the Crown estate and has been delivered by the Big Lottery Fund. Even in my constituency in the industrial heartland of central Scotland, some groups have managed to tap into the coastal communities fund. What are the plans for the fund from now on?

Roseanna Cunningham

The short answer is that we are considering the best way forward. The member is correct. We inherited the scheme from the United Kingdom Government along with the various financial pressures created by the fiscal framework and the reduction in the Scottish block grant, which is also linked to the devolution of the Crown estate.

The coastal communities fund is currently competitive and there is no guarantee of success. There are many coastal parts of Scotland that have never received coastal communities fund funding. Traditionally, it has been administered by the Big Lottery Fund. We are looking at in the context of the changes that are being made in the Crown Estate. We are absolutely committed to following current projects through to completion, but no final decision has been made about the coastal communities fund, because of its link to the formula for the Crown Estate funding.

Given the different set of funding circumstances at a national level and given that coastal communities will now receive moneys that are directly disbursed by the Crown Estate, we need to consider whether, in Scotland, the coastal communities fund should be continued. No final decisions have been made because we need to work through several issues. I remind everyone that the commitment to all coastal local authorities getting money will mean that money will go to several local authorities where communities have never been given any money from the coastal communities fund. We are now in a different set of financial circumstances.

Angus MacDonald

I understand that there is a suggestion that the funding formula will be revised from 50 to 33 per cent of the revenues from marine activities—

Roseanna Cunningham

That is the Treasury—

Angus MacDonald

Yes, the UK Government.

Roseanna Cunningham

Yes. I am not sure whether the officials know more about that and what impact it might have on us, if any. I think that it is about the coastal communities fund.

David Mallon

That is correct. It is our understanding that the Treasury recently reduced the amount of money that it makes available under the coastal communities fund from an equivalent of 50 per cent of Crown Estate marine income to 33 per cent of marine income. The fiscal framework agreement on the devolution of the coastal communities fund was based on expenditure in the year prior to the transfer, so all that should have worked through the system.

Angus MacDonald

Thank you.

During our consultation, we received a submission from Grangemouth yacht club, in my constituency, which told us:

“the only regular contact we have with”

the Crown Estate

“is an annual demand for £640.”

As a matter of principle, the Crown Estate and other asset managers have to provide a service for what they charge their tenants. Is there scope for smaller community organisations such as Grangemouth yacht club to be exempt from charges?

Roseanna Cunningham

Well, the rent of a property is the service. The club is paying rent for something; it is not paying rent for nothing. That is the short answer. I think that the club will have the exclusive use of the mooring, so that is what the rent is for.

On the wider point about exempting smaller community organisations, we must bear in mind the duty in section 7 to

“maintain and seek to enhance—

(a) the value of the assets, and

(b) the income arising from them.”

Managers are empowered to do what is considered appropriate in that regard. There will be no blanket exemptions; exemption will be very much a matter for managers locally. A different set of managers might decide to exempt an organisation if they felt that there was a bigger picture that they wanted to pursue. I am sceptical as to whether that is likely in the shorter term, to be frank, given the duties on managers.

Angus MacDonald

We cannot blame the yacht club for trying. [Laughter.]

Roseanna Cunningham

It can ask, but whether it is successful is another matter.

Donald Cameron

I refer to my entry in the register of members’ interests; I am a landowner in the Highlands.

I have two questions. The first is about cross-subsidy, which we have discussed a little. We talked about giving Crown Estate Scotland financial flexibility. Forgive my ignorance: is the Crown Estate currently able to, for example, borrow or enter into joint ventures or other arrangements that would give it financial flexibility, and does the bill change the current position?

David Mallon

At present, the Scottish ministers can give loans to the Scottish Crown Estate, and the bill extends that to include other managers. The Crown Estate Act 1961 provided for a limited number of situations in which a manager could enter into borrowing. It could happen only in a very narrow set of circumstances, and Crown Estate Scotland—in its nascent form—viewed that as a constraint on viability, so the Scottish ministers decided to extend the facility to provide loans. Beyond that, there is no intention that wider loans be taken out, because of the risk that that could pose to the monarch’s ultimate ownership of the estate.

The bill was specifically designed not to preclude joint ventures from being entered into. We continue to discuss that with Crown Estate Scotland on an operational basis to see whether there is a need for that.

Donald Cameron

That is very helpful. I want to move on to delegation and the transfer of management responsibilities. It is right that sections 3 to 5 of the bill set out the processes for transfer and delegation. Is the panel satisfied that those processes will be effective? Are they transparent, and do they allow proper parliamentary scrutiny? Will they give asset managers clear lines of accountability that they can work to? Is there an effective dispute resolution process?

Roseanna Cunningham

Yes. Broadly, the bill’s provisions are appropriate and allow for what has been raised. Transfers will be made by Scottish statutory instruments, which will be subject to parliamentary scrutiny, and the terms and conditions of the transfer will be set out in the SSI. Details will therefore be available. Similar provisions will be made in respect of delegation, but it will not be subject to a parliamentary procedure because, in effect, Crown Estate Scotland will retain aspects of management that have not been delegated to another manager. Our position is that that part of the bill does exactly what it should do.

It is being flagged up to me that there will be annual reporting and that dispute resolution will be part of the SSI or the delegation agreement. That will be built into what will be seen up front when the management is being transferred.

Mark Ruskell

Do you see a potential conflict of interest for local authorities given their function as planning authorities in relation to aquaculture and the fact that they will be net receivers of revenues under the bill? Do you see a similar conflict of interest in relation to harbour authorities, which arguably have less stringent democratically accountable governance processes in some cases, compared with those of councils?

Roseanna Cunningham

Our view is that councils already have to make a huge range of decisions across a number of areas in which it could objectively be argued that they have conflicts of interest. Councils’ planning authorities have to make the planning decisions when it comes to building schools. Handling conflicts of interest is already part and parcel of what local authorities have to do. To my knowledge, they already have pretty rigorous governance arrangements to manage that, and I do not see why things would be any different under the bill. I cannot imagine that any council would intentionally try to mismanage.

I do not want to be drawn down the road of talking specifically about aquaculture, because what I am saying could apply to almost anything. Councils will try to ensure that their management is as well done as the management of any aspect of their duties. Councils in particular are well versed in managing conflicts of interest.

If a harbour authority becomes a manager, it will need to comply with the duties that are legislated for in areas such as reporting. It will need to bring itself into compliance in those areas. The situation is manageable, because these things have had to be managed for decades. Single local authorities do that work regularly, and I do not imagine that Crown estate assets will be managed any differently from that.

12:30  



Mark Ruskell

Will there be a tension, particularly with harbour authorities? For example, there is a commercial incentive to develop ship-to-ship oil transfers, but a harbour authority also has a regulatory function to discharge.

Roseanna Cunningham

Any manager that takes on the management of an asset, regardless of what it is, will need to comply with all the statutory requirements that relate to that area of endeavour. Perhaps I am misunderstanding the issue that you are trying to raise, but all those matters will be part and parcel of the management.

The Crown Estate has to abide by the requirements, which it does. We are not bringing in anything new by asking devolved managers to also comply with any legislative authorities. The explanatory notes state:

“Section 18 requires managers to exercise their functions in a way that is transparent and accountable”.

Any harbour authority or other manager that makes a decision—for whatever reason—will need to be clear about why it is doing so. Managers will also need to comply with a range of other statutory obligations that are required in any area of endeavour.

Mark Ruskell

I was just referring to the potential conflict in that harbour authorities have their own regulatory functions.

Roseanna Cunningham

I do not know what potential conflict you have in mind. If a harbour authority wants to take over the management of the harbour, it will need to manage the harbour in a way that delivers all the objectives that we have set out. It will do that—

Mark Ruskell

What will happen in relation to the appropriate assessment under the habitats directive, for example?

Roseanna Cunningham

Harbour authorities will still have to comply with that directive, which will still be in place. None of the regulations will fly off because an authority has become a manager of a Crown Estate property.

David Mallon

As I understand it, harbour authorities already have functions that relate to ship-to-ship oil transfers. The Crown Estate’s functions relate to sea bed ownership—primarily maintenance dredging, other forms of dredging for navigational purposes and the dumping of spoil that has been collected through dredging. The bill’s provisions are about the control of those activities. As the cabinet secretary says, those activities would have to be undertaken by any manager because of the wider regulations that exist.

John Scott

The Law Society of Scotland has expressed concerns about the drafting of section 6, stating:

“We do not consider that the meaning of ‘relates to a community’ where it appears in section 6(1)(a) is clear.”

What is the definition of “relates to a community” in that section?

Furthermore, the requirements that are set out in section 6(2) do not appear to be inclusive—particularly those in paragraphs (c) and (d). The Law Society considers that there would be

“merit in amending the requirements for a community organisation to fall within the terms of the Bill.”

Does the Scottish Government agree with the Law Society that sections 6(2)(c) and 6(2)(d) could be amended to be more inclusive?

Roseanna Cunningham

The provisions in section 6 on community organisations are similar to those in the Community Empowerment (Scotland) Act 2015. In my view, that means that they are sufficiently inclusive. We have to recognise that evidence of community control is important, but given that, in effect, the definition has been imported from existing legislation, we believe that it is sufficiently inclusive. I am not sure whether the Law Society was aware of that, but that is where the definition has come from.

John Scott

Section 6(2)(f) mentions

“promotion of a benefit for that community”.

The Law Society says:

“We note that the concept of public benefit is already recognised in the law, for example in section 8 of the Charities and Trustee Investment (Scotland) Act 2005. It would be helpful if there was some consistency between these statutes particularly when section 17 of the Bill refers to the ‘public benefit’ provisions under the 2005 Act.”

On the one hand, we have

“promotion of a benefit for that community”

and on the other hand we have “public benefit”. Should there be more consistency around the terminology of public benefits, as the Law Society suggests?

Roseanna Cunningham

Again, we have replicated the definitions in the Community Empowerment (Scotland) Act 2015. In our view, that provides sufficient consistency. I have not seen the specific Law Society evidence to which you refer and I do not know whether the Law Society was conscious of that. I cannot think of a better example of consistency than to use definitions that are used in other legislation.

John Scott

Perhaps that is something that you will reflect on. Thank you for your answers.

Finlay Carson

Some of the evidence that the committee has heard has argued for the strengthening of protection against the sale of the sea bed. Can the bill be strengthened to prohibit sales of the sea bed, and should it be? Do you agree with COSLA, for example, that there are circumstances in which the sea bed might be sold?

Roseanna Cunningham

We are not convinced by the COSLA position. This Government’s view is that the presumption against selling the sea bed should be maintained. We have talked a lot about cross-subsidy. The fact that a bit of sea bed is a loss-making asset is not a reason to sell it, because there is the capacity to cross-subsidise. Given that we are maintaining the element of cross-subsidy, we think that the presumption against selling the sea bed should remain. I have no doubt that the debate will continue, but at this stage we are not convinced that the COSLA approach is correct.

The Convener

I thank the cabinet secretary and her officials for coming to the committee. It has been a long morning, but we have covered a lot of ground.

At the committee’s next meeting, on 1 May, we will consider subordinate legislation relating to the Loch Carron marine conservation order, which we considered last year. The committee will also consider draft correspondence on the national performance framework, consider its approach to the gender diversity of witness panels and review its work programme.

As agreed earlier, the committee will now move into private session.

12:39 Meeting continued in private until 13:00.  



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20 February 2018

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13 March 2018

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27 March 2018

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17 April 2018

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24 April 2018

Environment, Climate Change and Land Reform Committee Committee's Stage 1 report 

What is secondary legislation?

Secondary legislation is sometimes called 'subordinate' or 'delegated' legislation. It can be used to:

  • bring a section or sections of a law that’s already been passed, into force
  • give details of how a law will be applied
  • make changes to the law without a new Act having to be passed

An Act is a Bill that’s been approved by Parliament and given Royal Assent (formally approved).

Delegated Powers and Law Reform committee

This committee looks at the powers of this Bill to allow the Scottish Government or others to create 'secondary legislation' or regulations.

It met to discuss the Bill in public on:

Read the Stage 1 report by the Delegated Powers and Law Reform committee published on 21 March 2018.

Debate on the Bill

A debate for MSPs to discuss what the Bill aims to do and how it'll do it.

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Stage 1 debate on the Bill transcript

The Deputy Presiding Officer (Linda Fabiani)

The next item of business is a stage 1 debate on motion S5M-12846, in the name of Roseanna Cunningham, on the Scottish Crown Estate Bill. Before I invite Joe Fitzpatrick to open the debate, I call Michael Matheson to signify Crown consent to the bill.

The Cabinet Secretary for Justice (Michael Matheson)

For the purposes of rule 9.11 of the standing orders, I advise Parliament that Her Majesty, having been informed of the purport of the Scottish Crown Estate Bill, has consented to place her prerogative and interests, in so far as they are affected by the bill, at the disposal of the Parliament for the purposes of the bill.

The Deputy Presiding Officer

I call Joe Fitzpatrick to speak to and move the motion.

15:39  



The Minister for Parliamentary Business (Joe FitzPatrick)

In the absence of the Cabinet Secretary for Environment, Climate Change and Land Reform, I will open the stage 1 debate on the Scottish Crown Estate Bill.

The bill proposes a new framework for management of Scottish Crown Estate assets, including reform of the main duties of the manager, because those duties are more than 50 years old. The bill will also confer on the Scottish ministers new powers to change who manages Scottish Crown Estate assets, and opens up the possibility of local authorities and communities taking control of management of assets in their areas.

We want to maximise the benefits of the Scottish Crown estate for communities and for the country as a whole, while ensuring that assets are well maintained and managed, with high standards of efficiency, openness and accountability. That is vital, because the Scottish Crown estate is a diverse portfolio that includes 37,000 hectares of rural land, half of Scotland’s foreshore, urban property and sea-bed leasing rights for activities including renewable energy generation.

Until recently, the assets were managed on a United Kingdom-wide basis; the Scottish Parliament received legislative competence for management of the assets under a key recommendation of the Smith commission. At the point of devolution of that management last year, Crown Estate Scotland (Interim Management) undertook management of the assets.

The bill was introduced in January 2018. In line with the Smith commission recommendations, it provides opportunities for councils and community organisations to manage assets themselves. There are two mechanisms in the bill for changing who manages a Scottish Crown Estate asset: first, it can be done through transfer of management to a local authority, community organisation or Scottish public authority, and secondly it can be done by direction of the existing manager to delegate day-to-day management to a local authority, community organisation or Scottish public authority. Under a delegation, the existing manager may continue to hold the ultimate responsibility for managing the asset.

The cabinet secretary’s intention is to use the new powers to enable devolution of management on a case-by-case basis. That approach will enable decisions to be taken carefully and with the approval of Parliament, while recognising that a one-size-fits-all approach is not suited to such a diverse range of assets.

The effective and continuing management of the Scottish Crown estate is important for Scotland as a whole. We have therefore made provision in case things go wrong, at any point. We have specified that regulations may require a community organisation to notify us of changes to its constitution that result in that transferee ceasing to be a community organisation. We can also transfer management of an asset from a local manager to Crown Estate Scotland or to the Scottish ministers, as a holding measure, to ensure that tenants are not affected if a community organisation struggles to fulfil its duties in managing an asset.

We have included new duties to maintain and enhance the value of assets, and to obtain market value in a way that is likely to contribute to the promotion or improvement of economic development, regeneration, social wellbeing, environmental wellbeing and sustainable development.

Although buying and selling property is part of management of the Scottish Crown estate, there is a presumption against sale of the sea bed. We have, in the bill, taken powers to restrict or control the power of a transferee or delegate to sell part or all of the asset that they manage. In particular, sales of the sea bed by any manager would require ministerial consent. We think that that will maintain the integrity of the Scottish Crown estate.

Alex Rowley (Mid Scotland and Fife) (Lab)

The minister will be aware that many organisations in Scotland believe strongly that sale of the sea bed or foreshore should require the consent of Parliament, too. What is his view on that?

Joe FitzPatrick

Alex Rowley has made a good point. I think that the cabinet secretary has made it clear that Parliament will be an important part of all processes. I am sure that she will carefully consider that point, in due course.

The financial flows from the Scottish Crown estate are not straightforward. I will explain what is entailed in that regard. The Scotland Act 1998 places restrictions on how revenues from assets and activities, minus the cost of managing the assets, are paid to the Scottish consolidated fund. The UK Government’s annual block grant to Scotland has been reduced by the estimated amount of net revenues that Scottish Crown Estate assets earned in 2016-17—a reduction of £6.1 million. Whoever manages the assets clearly has to maintain and seek to enhance their value, and the income arising from them, otherwise Scotland will be out of pocket.

Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

I am sure that the minister will welcome the fact that how Crown Estate Scotland is to manage assets will not be simply a financial issue, and that sustainable management will also be an important part. I am sure that that will be widely welcomed.

Joe FitzPatrick

Stewart Stevenson has made a good point. The bill makes specific allowance for that, and for the importance of maintaining and potentially enhancing the assets that we have, which are assets for Scotland.

Outwith the bill, we are committed to distributing to island and coastal local authorities the net revenue that is generated by marine assets out to 12 nautical miles. That local function will not be hypothecated, but we expect local authorities to be transparent and to be accountable to their communities for how that money is spent.

When management of the Scottish Crown Estate’s assets was devolved, we inherited arrangements that allowed the manager of an asset to retain 9 per cent of the gross revenue for investment in the estate—for example, for new farm buildings or for purchase of new assets. We are keeping in the bill the ability for a manager to retain a proportion of gross revenue for investment in maintaining the estate. However, we are taking the power to be able, in the future, to vary the percentage that can be invested. It might be that some assets need more capital investment than others, so we want to provide for that.

The bill also seeks to ensure that assets can, in the future, be maintained through cross-subsidy. It is important to keep the ability to cross-subsidise when there are several local managers of Scottish Crown Estate assets. We are therefore taking powers to direct a manager to transfer money to other managers’ accounts. In that way, a community could take over management of a local asset if there were a good case demonstrating the benefits of that to Scotland, even if the asset did not currently generate enough income to cover costs. To be clear, such money would come from a manager’s Scottish Crown Estate accounts and not from their other accounts. The bill requires a strict separation between a manager’s Scottish Crown Estate accounts and any other accounts that are held by them.

We are clear that a robust governance framework is required in order to provide the Parliament and citizens of Scotland with assurances and transparency concerning management of the Scottish Crown estate. The bill sets out a national governance framework that specifies accounting and reporting procedures to ensure sufficient openness about the management of assets—local or national.

The framework also comprises a national strategic management plan, managers’ management plans, annual reports from managers, and measures to promote consistency in reporting and accounting. The strategic management plan and annual reports will be laid in Parliament so that members can oversee management of the Scottish Crown estate. The bill provides for members to approve transfer of the management of assets, and accounts will be audited by the Auditor General. That all provides a robust but proportionate framework for governance and oversight of a valuable portfolio of assets, of which this Parliament now has stewardship.

I have set out the purpose of the bill, which enables the Scottish Crown estate to be used for the economic, social and environmental benefit of Scotland and its people. I appreciate that it is a highly technical piece of legislation, so I thank members of the Environment, Climate Change and Land Reform Committee for the careful and constructive way in which they have dealt with the various issues.

I move,

That the Parliament agrees to the general principles of the Scottish Crown Estate Bill.

The Deputy Presiding Officer

I call Graeme Dey to speak on behalf of the Environment, Climate Change and Land Reform Committee—for up to eight minutes, please.

15:48  



Graeme Dey (Angus South) (SNP)

As convener of the Environment, Climate Change and Land Reform Committee, I very much welcome the opportunity to highlight its views, as contained in its stage 1 report, on the Scottish Crown Estate Bill—albeit that time constraints will curtail the detail that I will be able to go into on our views.

The committee welcomes devolution of the Crown estate as a significant recommendation of the Smith commission report, having previously supported the interim arrangements for management of the estate that were put in place in April 2017.

The committee welcomes the Scottish Crown Estate Bill and its provision for the longer-term management of Scottish Crown Estate assets, including 37,000 hectares of land, sea bed, mineral and fishing rights, coastlines and rural estates. The bill provides a clear focus on ensuring that the estate’s assets are managed sustainably by those who are best placed to do so—whether that be Crown Estate Scotland, a local authority or a community group.

The committee supports the intention of the bill, which seeks to move beyond a focus on profitability and to encompass other factors including regeneration, social wellbeing, environmental wellbeing and sustainable development, when deciding how an asset should best be managed. That is the right approach, which seeks to recognise that there is a different ethos in Scotland.

However, the committee believes that there is scope to go even further. The committee therefore welcomes the Scottish Government’s commitment, in its response to our stage 1 report, that it will consider guidance to ensure not only that the wider environmental factors are taken into account, but that their consideration can be clearly evidenced.

As part of the committee’s consideration of the bill at stage 1, we heard from a range of stakeholders, including representatives of Crown Estate Scotland’s four rural estates, representatives of its non-agricultural assets, and stakeholders who are involved in the strategic direction and governance of Crown Estate Scotland. The committee also carried out a confidential survey of existing Crown Estate Scotland (Interim Management) staff to ensure that their views or concerns would be captured in our work. The committee records its thanks for the evidence that was provided by them all, and for the constructive engagement that we enjoyed.

The committee was pleased to note that many of the Crown Estate’s tenants had already noticed significant improvements since management of the estate was devolved to Scotland, including the creation of tenants groups on the four rural estates, which has led to improved communication between tenants and factors. The committee is hopeful that the bill offers an opportunity to make further progress.

Although the committee is broadly supportive of the general principles of the bill, we have made a number of recommendations about what should be included in it, and what should to be left to regulations and guidance. The Delegated Powers and Law Reform Committee also made a number of recommendations with which the Environment, Climate Change and Land Reform Committee agrees. Broadly, those recommendations seek to ensure that when significant decisions are taken about the future of the Crown estate, there is sufficient parliamentary scrutiny of each decision—although the committee is conscious of the need to strike an appropriate balance between matters that are operational decisions for Crown Estate Scotland and those that require further scrutiny.

The bill offers opportunities to local authorities and community organisations to take on management of Scottish Crown Estate assets, but the committee believes that the sea bed, as a national asset, should continue to be managed nationally and that the bill should be amended to ensure that it cannot be sold, under any circumstances. The committee recommends that the Scottish Government outline clearly which Crown Estate Scotland assets it anticipates will continue to be managed on a national basis and which can be devolved to local management.

The extent to which the Crown estate in Scotland is likely to become fragmented as a result of the bill was a cause of concern among some stakeholders. The committee also considered cross-subsidisation, which happens when the income from one asset subsidises a less-profitable asset. That process currently works well on a national basis, but it might prove to be problematic in the future. The committee has therefore recommended that Crown Estate Scotland establish and maintain a list of assets that outlines which of them are profit making and which are loss making, and that clearly sets out any associated liabilities.

The committee is also of the view that the process to manage cross-subsidisation of assets should be subject to affirmative procedure, and that a definition of what constitutes “significance” or “significant value” in relation to an asset should be clearly set out in the bill.

Managers of Crown Estate Scotland assets can currently retain 9 per cent of gross revenue for reinvestment in an asset. The committee is keen to ensure that the definition of “community” extends to communities of interest, in order to allow broader interest groups to be able to take on management of assets, and it is keen that such groups be appropriately supported in doing that. I therefore welcome the Scottish Government’s undertaking that it will consider the matter further in advance of stage 2.

The committee sees clear benefits in retaining national oversight of the Crown Estate’s rural estates, offshore renewables, energy-related assets and other cables and pipelines, although it acknowledges that, on occasion, it might be beneficial for an asset to be managed locally, and that we therefore need to retain provision for that.

The committee is content that local authorities should, when they can demonstrate appropriate expertise, be able to manage smaller-scale tidal and wind projects within 12 nautical miles of their shores. The committee therefore welcomes the Scottish Government’s commitment that that process and the criteria for it will be included in guidance, that the guidance will be available by the time the sections on transfer and delegation come into force, and that there will be further consideration of the inclusion in guidance of a definition of “good management”.

Crown Estate Scotland tenants are generally happy with how Crown Estate Scotland is being run. Tenants feel that devolution has brought an increased feeling of connectivity with the estate, improved communication and more involvement in decision-making processes. Tenants regard Crown Estate Scotland as a good landlord, and feel that the Scottish Crown Estate Bill offers the opportunity to make further improvements to how the estate is run.

The Committee seeks further clarification from the Scottish Government about the rationale for setting the figure for retention at 9 per cent, why there are no plans to alter that, and what arrangements it will put in place to ensure that 100 per cent of net revenues that are generated out to 12 nautical miles will be used for the betterment of coastal communities.

The bill contains a number of useful mechanisms that are designed to improve transparency and accountability. The concept “good management”, however, remains undefined. The committee suggests that the Scottish Government consider including a definition of that in the bill or in guidance, and that the process and criteria for deciding the suitability of a potential manager be clearly set out in guidance.

The committee agrees that the bill will bring benefits not just to the Crown estate, but to Scotland as a whole, by ensuring that community empowerment and sustainability are at the heart of Crown Estate Scotland’s future. I am therefore pleased, on behalf of the Environment, Climate Change and Land Reform Committee, to commend the general principles of Scottish Crown Estate Bill to the Scottish Parliament, and to recommend that the motion be agreed to.

15:56  



John Scott (Ayr) (Con)

I begin by declaring an interest as a farmer and for other interests I refer members to my entry in the register of members’ interests. I welcome the stage 1 debate on the Scottish Crown Estate Bill and say at the outset that Scottish Conservatives will support the bill at decision time.

It is worth noting at this stage that the income for Crown Estate Scotland that previously went to the UK Treasury will now accrue to the Scottish Government, and how the Scottish Government manages those assets in the future will determine the level of income that the Scottish Government will receive from them. Under the bill, as well as delivering an income to the Scottish Government, Crown Estate managers might also be expected to deliver additional benefits, including contributing to sustainable development, delivering on economic regeneration, and delivering on social and environmental wellbeing.

It is also important to note that the bill will allow for management of assets to be devolved to local authorities and other community groups and bodies. Scottish Conservatives welcome that further devolution of the management and transfer of assets, always provided that potential new managers and owners have a full understanding of the obligations and responsibilities such transfers require. However, landlocked local authorities such as South and North Lanarkshire and East Renfrewshire must not lose out on the benefits of the seas simply because they do not have a coastline.

Ambition alone will not be sufficient for such transfers to local authorities and communities, and any application to either manage or own assets that are currently under the care of Crown Estate Scotland must be subject to a strong business case being presented and due diligence being carried out by Scottish ministers. Any such proposal must also be subject to Scottish ministers assuring themselves that those who wish to embark on managing or owning Crown Estate assets have a full understanding of the actual and potential risks and liabilities that are attached to their proposals.

Scottish Conservatives are concerned that the transfer of the management of assets from Crown Estate Scotland could lead to the fragmentation and loss of expertise in the Crown Estate itself. Self-evidently, the more assets that are transferred from the Crown Estate, the harder it will be for Crown Estate Scotland to provide income to the Scottish Government, and a balance will need to be struck and an understanding reached between the Scottish Government, Crown Estate managers and interested third parties on the cost to the Scottish Government of transferring assets out of the current management structure.

Further, the more assets that are transferred from the Crown Estate, the harder it will be for cross-subsidisation between different parts of the estate if the size of the portfolio of the whole estate reduces year on year. If the portfolio of assets is reduced regularly, the income due to the Scottish Government and the 9 per cent investment income will also reduce.

On land management issues, Scottish Conservatives fully support the view of the Scottish Tenant Farmers Association, NFU Scotland and the tenants themselves that the national management of the four rural estates should be continued through Crown Estate Scotland. In principle, of course, that should not be subject to ministerial micromanagement and interference. That is why it is important to be clear from the outset—in the bill and in the guidance issued—what the remit of Crown Estate Scotland will be in that regard.

In practice, however, the temptation for ministers to interfere and the pressures on them to intervene in the day-to-day running of Crown Estate Scotland will be huge. A perfect illustration of that is the proposed sale of Auchenhalrig farm—part of Fochabers estate—by Crown Estate Scotland. Clearly, the proposed sale is, in Crown Estate Scotland’s view, being done for sound business reasons and for the benefit of the estate as a whole, yet the STFA is seeking to stop the sale as it will further reduce the dwindling amount of tenanted land available to incoming tenants across Scotland.

Although that is just an early example of the difficult decisions on which Scottish Government ministers will be under pressure to intervene, the proposed new criteria under which Crown Estate land managers will have to work will only make the pressure for ministerial intervention even greater, as we move away from the delivery of revenue to the Treasury as the sole measure of success of Crown Estate Scotland and towards the measures of success including the delivery of sustainability, social and mental wellbeing, and economic regeneration.

A whole new lobbying industry is probably about to be born that will seek to spend the revenues that the Government hopes to receive from Crown Estate Scotland. The need for clear direction in the bill and for guidance to be in place from day 1 could not be more important for the managers of Crown Estate Scotland if they are to provide a reasonable yield on their assets to the Scottish Government in the face of the much greater expectations that will be placed on them.

Alex Rowley

I appreciate that there may be a new lobbying industry, but do you think that there is an opportunity for tenants themselves to have a greater say?

The Deputy Presiding Officer

Always speak through the chair, please, Mr Rowley.

John Scott

Yes, I do, and I think that it is working well at the moment. I am pleased about the recent improvements in that regard, such as the tenants forum that has been set up.

I turn to other assets of Crown Estate Scotland. The Scottish Conservatives share the view of the committee that the sea bed should not be sold off, except perhaps in the most exceptional circumstances—that is just my own view—and we urge the Government to address that issue at stage 2.

We also recommend the retention within Crown Estate Scotland of the expertise to deal with offshore wind applications in particular and offshore energy and renewable energy applications in general.

The Scottish Conservatives believe that there is a significant and valuable body of knowledge within the Crown Estate staff that is at risk of being dispersed if too many assets are transferred from the Crown estate to local authorities and community groups, and the loss of such expert knowledge could reduce the critical mass of the management team, which is vital for good decision-making.

I turn to communities—

The Deputy Presiding Officer

No—you will have to close very quickly, please, Mr Scott.

John Scott

I conclude by welcoming the bill. We will support it at decision time and we will seek to improve on it at stage 2.

16:03  



Claudia Beamish (South Scotland) (Lab)

Scottish Labour supports the principle of the Scottish Crown Estate Bill. However, we would like to highlight some concerns about some aspects of the bill before we proceed to stage 2. I also intend to reflect on the recommendations of the ECCLR Committee, building on the comments of our convener, Graeme Dey.

In its briefing, the Law Society of Scotland rightly highlights the need for

“full transparency and accountability in relation to management of the Estate”,

and the RSPB Scotland briefing stresses that this is a “step change”. Although both might seem to be obvious comments, they are at the core of the future of the Crown estate once its management is devolved, a move that Scottish Labour heartily welcomes.

I have long argued, along with others, for the mission of the Crown Estate to have a social remit and indeed an environmental one, setting sustainable development at its heart. Now, by devolving the powers and setting out the governance arrangements in this bill, Parliament has the opportunity to enshrine this inclusive and empowering way forward in statute.

The bill seeks to enshrine the principles of good management of the Crown estate. I ask the minister and, indeed, the cabinet secretary—I wish her well and perhaps she can reply to this when she is better—what the criteria are for good management of a public asset in the 21st century. Scottish Labour is pushing to strengthen the principles and looking to place an obligation on managers to take account of enhancing regeneration, social wellbeing, environmental wellbeing and sustainable development, in parallel with the obligations for a financial return. Thus, managers could be required to consider issues beyond financial ones and report on how they take those into account. In my view, the most straightforward way to do that would be to change “may” to “must” in section 7(2) but, then, I am not a lawyer.

The ECCLR Committee felt that the Scottish Government should consider rewording the duty on decision makers in section 7(2) in deciding how an asset should be managed. Further, the committee

“believes this should be the case even if such consideration leads to the conclusion that a factor may not be relevant.”

The cabinet secretary has recognised that concern and I am pleased that she will consider it carefully.

Although Scottish Labour recognises the national significance of the Crown estate to Scotland, that should in no way prevent further devolution from taking place to local authorities, and particularly although not exclusively to island authorities, as highlighted by the Smith commission. There must be a process for that in relation to Highland Council, Orkney Islands Council or any other council. We wish the councils well in that process if and when the bill is passed. Steven Heddle, the environment and economy spokesperson for the Convention of Scottish Local Authorities, has stated:

“Paragraph 8 is at the start of the section titled ‘Local versus National Management’. It is worth stating that we do not view the future of the Crown Estate in such binary terms. Much like for Scottish devolution, we view the devolution of the Crown Estate as an evolving process which can change over time.”

Other members have talked about the ownership of the sea bed, which is a national asset. That is indeed a challenge. The ECCLR Committee says that the sea bed should be sold only in very rare circumstances. The Scottish Government will consider our recommendations for amendments to ensure that the sea bed cannot be sold. There should be a little more consideration of that before stage 2.

Edward Mountain (Highlands and Islands) (Con)

I take the point about the sale of the sea bed, but there is also concern about very long leases on the sea bed, which might not have break clauses in them. Does the member share my concerns on that?

Claudia Beamish

I have not considered until now the issue of break clauses but, with long leases, there should be very clear criteria as to appropriate management, as with the other arrangements for the devolution of management.

The committee made the argument, which Scottish Labour supports, that community managers should have support where necessary. However, we should not assume that, simply because they are community organisations, they will need more or less support than any other managers. Scottish Labour concurs with the committee’s belief that

“the current definition of ‘community organisation’ in ... the Bill is based around geographical factors alone and, as such, may not encompass ‘communities of interest’.”

That is a concern. The committee says that it would be helpful if the bill was in line with the similar provisions in the Community Empowerment (Scotland) Act 2015, and the committee recommends that the Scottish Government reconsiders the definition of community ahead of stage 2. I look forward to hearing from the cabinet secretary on that after she has reflected on it.

Scottish Labour believes that the consideration of community ownership in the bill is a significant issue, in view of the unjust patterns of ownership that continue intractably in Scotland. We should not rule out enabling communities to have ownership of particular assets and allowing them the autonomy and democratic process as community landowners to shape how those assets are used in practice. However, I grasp the point that there is a need to avoid fragmentation of the Crown estate.

The Deputy Presiding Officer

You must come to a close, please.

Claudia Beamish

I will—thank you.

My colleague Colin Smyth will go into some detail about tenant farmers, who also need to be protected.

As I said, we support the principles of the bill.

16:10  



Andy Wightman (Lothian) (Green)

This is a historic moment, as the Parliament debates legislation on the Crown estate. For the best part of 40 years, there has been an active campaign by, for example, the West Highland Free Press and politicians such as Brian Wilson and Michael Foxley to eliminate the malign influence of the Crown Estate Commissioners. I particularly commend the Crown estate review working group, which reported in 2006. That report from seven local authorities and COSLA brought the issue to public attention.

The estate comprises a range of Crown property rights, which are an intrinsic part of Scotland’s system of land tenure, as well as other conventional modern property acquisitions. Those rights were administered in Scotland until the 1830s, when control went south, leaving only bona vacantia, ultimus haeres and treasure trove rights, which, to this day, are administered by the Crown Office, with revenues paid to the Scottish consolidated fund.

John Scott

On a point of order, Presiding Officer. Is it parliamentary language and reasonable to use the word “malign” in describing Crown Estate officers who have been only, and absolutely properly, discharging their duties entirely within the law and their remit and doing that job extremely well?

The Deputy Presiding Officer

I will look carefully at the Official Report, although what members say in the chamber is their responsibility. I did not hear the phrase very clearly. No offence to Mr Wightman, but I was not listening closely at that point. However, I will consider the matter and come back to you on it, Mr Scott.

Andy Wightman

It is important to note two substantive things. First, Crown property rights and interest in Scotland have, for centuries, been defined by Scots law and that remains the case. Secondly, for most of their history, those rights have been administered in Scotland and the revenues have flowed to the Scottish exchequer, with only a short hiatus between 1830 and 2017. For example, they never formed part of the civil list, although England’s Crown revenues were surrendered in 1760. In other words, it is a distinctive, historical set of rights that belong to Scotland.

Attempts to devolve the powers in 1998 were blocked by the Treasury and the palace, with only the Crown’s property rights and the Crown prerogative included in the Scotland Act 1998. In 2014, the Smith commission recommended that management and revenues be devolved. Despite UK Government guarantees that the Smith commission report would be implemented in full, legislative competence for the revenues of the Crown estate was not devolved as it should have been.

The bill proceeds on the assumption that the Crown estate is a coherent suite of assets that, by law, must be maintained as an estate in land on behalf of the Crown. The Greens reject that assumption. The Crown estate is a feudal relic. It is an ad hoc estate of rights that includes everything from gold and silver, everywhere from a lock-up garage in the new town to the island of Rockall. Our goal should be to sweep away that anachronism and not perpetuate it in a framework of complicated management and delegation powers.

To put it simply, Scotland’s ancient Crown property—the regalia majora and minora—should be abolished and the rights converted or transferred as appropriate to other legal bodies. For example, despite the transfer of administration in 2014, there is no good reason why the mediaeval right of the Scottish Crown to naturally occurring mussels and oysters has any place in the modern statute book. The bill should abolish that right and confirm the species as ferae naturae—wild animals.

More substantially, the Crown’s right to the foreshore should be abolished. As the Scottish Law Commission notes in its 2001 “Discussion Paper on Law of the Foreshore and Seabed”, the Crown’s right to the foreshore is a patrimonial right that is derived from the Crown prerogative, although even that is, in the commission’s words, “The predominant modern theory”. The bill provides the opportunity to modernise the legal basis for the ownership of the foreshore, abolish the Crown’s rights and vest title in Scotland’s local authorities rather than have a complicated scheme of delegated management.

Similarly, as there is no statutory basis for the Crown’s ownership of the seabed, the bill could vest it in the Scottish ministers and create an equivalent to the national forest land scheme to enable transfers of title to Scotland’s 248 local authority harbours and 46 trust ports. That would end decades of legal disputes and conflict.

The Smith commission recommended that the responsibility for the management of Crown property be further devolved to local authorities. The bill makes provision for regulations to enable that but contains no statutory right. We will lodge amendments to make it clear that that transfer is a statutory right that is subject only to due process.

Graeme Dey rose—

The Deputy Presiding Officer

No, Mr Dey. Mr Wightman has to close.

Andy Wightman

Greens were elected to bring bold and transformative ideas to Holyrood. The Crown estate is a perfect example of where that is needed.

16:14  



Tavish Scott (Shetland Islands) (LD)

It is a good step that the Parliament is taking the powers of the Crown Estate, but I am with Andy Wightman—I am for a much more radical approach to the organisation. I will give John Scott two further examples of why we should do an awful lot more than just adopt an incredibly complicated and highly technical approach—the minister was right about that—to sorting out the issues.

When any trust port in Scotland decides to extend a quay or deepen a navigation channel, what does the Crown Estate do? It charges for that. The Crown Estate owns the asset, but does it invest in that? No—the trust port invests in it. The trust port deepens the navigation channel to allow for bigger ships or it reclaims land to improve the quay space, but it pays for the privilege of improving the asset that the Crown Estate owns.

If John Scott doubts the need for radical reform, I will give him a further example. When I handled such issues in a previous job back in Shetland, the Crown Estate passed to councils the job of handling applications for licences for aquaculture development, but the Crown Estate took the rental income. We did the work, but it took the income. The need for reform is considerable.

I will speak in particular about the sea bed. In relation to Crown Estate assets on land, other members might talk about farm tenants and others, but a much stronger devolved approach is needed to the sea bed inside 12 miles—there is an argument for dealing with the area outside 12 miles, too. A different approach for Scotland is needed that is based on the assets that exist.

Steven Heddle’s letter, which Claudia Beamish quoted from, sets out a coherent case for why island authorities—and others, if they so wish—should take on such responsibilities. The issue concerns local versus national management. The logic of the argument that everything must be done nationally suggests that Shetland Islands Council could never run the Sullom Voe oil terminal, which it has run for 40 years. In 1978, we dealt with the spillage of oil from the Esso Bernicia tanker in the confines of the voe. We had to put in place pollution prevention measures and we established what became a gold standard for dealing with oil spills. I do not remember anyone saying then that we should sweep away such powers and have all such facilities run by a quango—[Interruption.] If Edward Mountain wants to intervene, he is welcome to, but he should stop telling me that I am wrong from where he is sitting.

Edward Mountain

I am not telling you that you are wrong.

The Deputy Presiding Officer

Please speak through the chair.

Edward Mountain

I am sorry, Presiding Officer. I am not telling the member that he is wrong, but I wonder whether the law that applies to the sea bed and the coastline is exactly the same on the islands of Shetland and Orkney as that for the rest of Scotland. It would be helpful if Tavish Scott clarified that for me and other members.

Tavish Scott

I will not get into udal law—Andy Wightman, Stewart Stevenson and I might debate it, but not today—although an interesting question needs to be teased out by our learned friends on the bench. If Mr Mountain was referring to that, he will forgive me for not mentioning it today.

My point is about local versus national management. Shetland Islands Council and other local authorities that have marine responsibilities have been doing what we call marine spatial planning and what the Government calls the Marine (Scotland) Act 2010 approach for a lot longer than this place has been thinking about marine acts. I therefore do not accept the central contention that local government cannot be innovative and cannot come up with the right solutions to move the powers on and enable them to drive forward sustainable economic development in island and coastal communities.

That is why we need a much stronger approach, which is the epitome of what the Smith commission discussed. In the week when we discussed everything about the devolved powers of this place—a week that I will never get back—one of the few areas that all the political parties were in absolute agreement on was the need for change, for the Crown Estate’s powers to be devolved to this Parliament and for us to make decisions. However, we must get that right.

I cannot disagree more with the suggestion that nothing should ever be sold, because trust ports have been able to sell small parcels for many a year. Members who think that that ability should be taken away from trust ports would reinstate the worst management that we dealt with from London for decade after decade. If we asked those in trust ports around Scotland’s coast, they would say that such an approach was not right. It would not be right to replicate in Edinburgh the management that we did not care for from London.

I do not know what evidence the Environment, Climate Change and Land Reform Committee took on that, but the committee needs to reflect on an issue that is about the sustainable development of trust ports across Scotland, including the sensible provision to allow the purchase of small areas of sea bed under a pier after a trust port has invested in them. There is much that needs to be done here.

Although there is much in the bill that is good, the minister made a fair point, which is that we should not get bogged down in highly difficult, technical details and constructions of systems. We should do some radical things to shake the situation right up.

The Deputy Presiding Officer

We move to the open debate. Time is quite tight, so I ask for speeches of no more than 5 minutes, please.

16:20  



Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

I draw members’ attention to my registered small agricultural holding.

I will respond first to something that Tavish Scott said. I cannot find where it says in the bill—although I know that it is there—that it is possible to sell assets, provided the proceeds are used to purchase another heritable asset. That may not be a complete answer to Tavish Scott’s point.

I respond to the suggestion that this is a technical bill by making a few technical points that go beyond the Environment, Climate Change and Land Reform Committee’s consideration of the bill. A particular point relates to section 6(2)(a), which requires that a body that takes over the management of an asset has to have

“no fewer than 20 members”.

I invite the Government to have a wee think about that and build in some flexibility. I am thinking in particular of the recent buyout at Ulva, where, because of the way in which the community was defined, consent was required by a large number of people who were not on Ulva. There might be similar circumstances in future.

Andy Wightman

Will the member take an intervention?

Stewart Stevenson

I will make progress, if the member does not mind.

I want to make a few points about finance. Managers of assets that have been devolved to local communities are allowed to have other interests, although they have to keep the accounts for the Crown Estate asset separate from the accounts for any other assets. That is a perfectly proper provision. However, the aggregation of a Crown Estate asset with one that is not from the Crown estate may add to the value of the two assets. There is an unresolved question in the bill as it is currently drafted about how the income and liability should be divided.

Speaking of which, I refer to section 3(4)(a), which relates to a transferee ceasing to exist. It says:

“the function, and any rights or liabilities, transferred to the transferee ... are to transfer to another person”.

There is a wee bit of an awkward construct there in relation to liabilities if a community organisation becomes insolvent. Such an organisation is likely to be registered under the companies acts and therefore there will be provision for insolvency. It would be very unusual for the liabilities not to be extinguished at the point of insolvency; instead, we are legislating that they be transferred to someone else. In some very unlikely circumstances, a degree of irresponsibility could arise, where liabilities never rest on the shoulders of those who should be responsible for them. I invite ministers to have a wee think about that.

Section 14 limits the granting of a lease to 150 years. The period is a slightly odd choice; the period in the Long Leases (Scotland) Act 2012 is 175 years. Mr Wightman in particular will remember that because, as minister, I worked with him on that subject. I heard Edward Mountain refer to long leases of the sea bed. If a lease was more than 175 years, the 2012 act converted it to ownership. I post that as an interesting little aside, because I do not know whether there are any cases in which that has happened.

Primarily, I want devolution in relation to Crown Estate assets to work to the maximum possible degree. I am less interested in local authorities taking responsibility, although clearly there are areas in which that is appropriate. The success of what we are doing here will depend on our getting good, effective devolution down to quite small communities for which it may make a substantial difference.

The bill is relatively silent on the issue of community and there is some advantage in that. The Ulva buyout illustrates that as, although we were able to make the land reform provision for community buyouts work, it worked in a very odd way, because only a tiny minority of those who had to give permission were on Ulva. It is worth looking at that.

Paragraph 342 of the report draws attention to the absence of an

“up-to-date assessment of the condition of Crown Estate assets in Scotland”.

I welcome the fact that that is being remedied, because lack of knowledge of one’s assets is the road to economic and financial perdition.

I wish the bill every success.

16:25  



Peter Chapman (North East Scotland) (Con)

I declare an interest as a partner in a farming business.

I am pleased to be involved in today’s debate on an important piece of legislation that follows from the Smith commission recommendations in the Scotland Act 2016. The act was delivered by a Conservative Government and it allows the devolution of the management of the Crown estate to the Scottish Parliament.

Andy Wightman

Will Peter Chapman take an intervention?

The Deputy Presiding Officer (Christine Grahame)

There was a big heavy sigh, but the member will take an intervention, Mr Wightman.

Andy Wightman

Does the member agree that, contrary to what the Smith commission recommended on devolving the management of the revenues, the revenues remain reserved under paragraph 3(3)(a) of part 1 of schedule 5 to the Scotland Act 1998?

Peter Chapman

I must bow to the member’s superior knowledge. I cannot comment, as I really do not know.

We are broadly in support of the recommendations in the ECCLR Committee’s report.

The Crown estate in Scotland comprises a wide range of assets that includes rural estates; rights to fish wild salmon and sea trout in river and coastal areas; rights to naturally occurring gold and silver in most of Scotland; some moorings, ports and harbours; the sea bed out to 12 nautical miles; the rights to offshore renewable energy and gas out to 200 nautical miles; and business property in Edinburgh.

The bill allows for further devolution of management of powers to local authorities, public bodies and community organisations. The ECCLR Committee is of the opinion that, although powers may be further devolved, some assets should remain under national management. The Scottish Government needs to make it clear which assets must be retained under national control and those that may be devolved to a local level. My concern is that the devolution process might lead to the wholesale fragmentation of the estate, which, if it were to happen, would be a mistake.

Crown Estate Scotland tenants are generally happy with how the Crown estate is being run during the transition phase. Tenants report that devolution has brought significant benefits, including connectivity with the estate, improved communication and more involvement in decision making.

The bill provides for a number of mechanisms that are designed to provide transparency and accountability in the management of assets. However, more needs to be done in the bill to provide clarity on how suitable, able and knowledgeable those who are applying to manage assets actually are. A further issue is that, although a policy of operating cross-subsidies across different assets works well at present, there is the potential for that to become more complex once assets are devolved to a local level.

I endorse the ECCLR Committee’s concern about the lack of financial flexibility in the bill. I agree that there are significant benefits in Crown Estate Scotland having the ability to hold capital reserves for strategic investment, and to retain revenue to service capital expenditure. The historical figure of 9 per cent gross revenue that can be retained needs to be reassessed.

Agriculture tenancies should remain centrally managed, reflecting the wishes of the tenant farmers. Tenants are concerned that local authorities might take control of the agricultural holdings of the Crown Estate. We are also concerned about that and recognise that the Crown Estate is seen as an excellent example of a landlord that works well with its tenants, and that is prepared to offer long-term stable tenancies and to invest in its farms for the long-term good of the estate.

Claudia Beamish

Will the member take an intervention?

Peter Chapman

I do not have time—I am sorry.

There is also the possibility that new young entrants into farming might be offered subsidised rents for an initial period to allow them a start. National management is therefore vital. That is what the tenants wish to see, and it must happen in the long term.

The bill is clear that assets must be managed in a way that leads to sustainable development. Factors such as social and environmental wellbeing, as well as profitability, must be taken into account in all management decisions. We on the Conservative side of the chamber recommend a measured approach to how island communities and island local authorities are dealt with in the process of devolving management powers. The Islands (Scotland) Bill that has just been passed by Parliament has raised expectations, and island authorities may be well placed to take on the management of assets around their coasts. Pilot schemes should be put in place as soon as possible to allow that to happen.

We are broadly supportive of the bill at stage 1, and I look forward to opportunities to strengthen and fine tune the bill as it makes its way through the process to becoming law.

16:30  



Richard Lochhead (Moray) (SNP)

I welcome the debate and thank the committee for the stage 1 report, the Scottish Government for all the effort that it has put in and all the campaigners down the years for the achievement of the devolution of the Crown estate.

According to the Scottish Parliament information centre briefing, this journey has been long—it has taken us 952 years to get here, so I understand the impatience of those who wanted to get everything right on the first day of devolution. However, according to the briefing note, the Crown Estate dates back to 1066 and, since 1760, the net income has been transferred to the Exchequer under successive civil list acts. It has, indeed, been a long journey and we should celebrate that we have got here. We are now 19 years into devolution, so it has been a lot longer than any of us expected, especially for those of us who have been involved in this debate for many years.

A few years ago, when we finally persuaded representatives of the Crown Estate to come to the Parliament’s committees, they gave bare outlines of financial figures but there was not a lot of transparency. At that time, it was seen as a breakthrough because for many years—those 952 years—there had been no transparency. The debate has been around the fact that our natural assets should be used for the benefit of the people of Scotland, particularly the communities that are closest to the Crown estate; our tenant farmers should not be working their socks off, nor should other more tangible assets be being used, to generate net revenues to go to the UK Exchequer in London. We are now much further forward and there is huge potential to ensure that our natural assets work for the benefit of our communities and the Scottish national interest.

In my Moray constituency, I have had a long-standing interest because of the Fochabers and Glenlivet estates, the coastline of the Moray Firth, fishing rights in the rivers and other assets, such as the harbour in Portgordon, which is owned by the Crown Estate. Our local communities in Moray have called for change for a long time and they welcome the devolution of the Crown estate. The key will be to show that things are different. It is fantastic that, in the bill, the Scottish Crown Estate has a new remit of

“economic development ... regeneration ... social wellbeing ... environmental wellbeing”

and

“sustainable development”.

Although we must address the balance between continuity and change, because we want to show that things are different, we will need an element of continuity. The tenant farmers in the farm estates in my constituency, for example, want to ensure that we get the benefits of devolution but we must also ensure that the Crown Estate as a whole will continue to exercise the ability to invest in the many tenant farms in Moray and throughout the whole of Scotland. We must strike that very careful balance.

I am pleased that the committee report recognises that point in the division between what should be managed nationally and locally. Many issues should be managed locally; representatives of the Findhorn Village Conservation Company, which has now taken over land through an award from the land fund, reminded me when I met them just yesterday that Findhorn bay has mooring fees that go to the Crown Estate. They, of course, would like those fees to support Findhorn’s local community. Therefore, there is a strong case for further devolution of management of the assets in some areas, but for other assets, such as tenant farms and the farming estates, to be managed nationally. I know that my local tenant farmers are loth to accept the idea that Moray Council—a more local body—should take control, because that would raise all kinds of issues about the viability of those estates in the years ahead.

That takes us to another key tension, which is how to have cross-subsidisation at the same time as the ability to allow a local community to take control of some assets to generate revenues for the overall Crown Estate. Of course, that would be made very difficult in the years ahead if there was fragmentation of those assets. I therefore agree with the Scottish Government that, as we move forward, we should take a cautious approach to some of the tensions and debates. If there was fragmentation of the Crown Estate’s assets, there could not be that cross-subsidy, which would lead to financial and liability issues for the tenant farms in particular but also for other assets.

However, we have to have that balance as people will want to know that things are different and that the Crown Estate will be much more responsive to local needs and will work in partnership on them. I would like the Scottish Crown Estate to be given the ability to have joint ventures and more commercial operations. I am pleased that the stage 1 report addresses that as well.

During the debate over the devolution of the Crown estate, I remember that we could not persuade the UK Government to devolve the Fort Kinnaird asset to Scotland. In that regard, I note reports in the media last week that the Crown Estate—not the Scottish Crown Estate, but the Crown Estate for the rest of the UK—which refused to devolve the Fort Kinnaird asset, despite the fact that it is in Scotland, which was an absolute scandal, has sold that asset for £167.3 million to M&G Real Estate. Now we know why the UK would not devolve that asset to Scotland: it is because it wanted to con us out of that £167.3 million.

The Deputy Presiding Officer

I am afraid that you must conclude.

Richard Lochhead

I wish the Scottish Government well in consulting communities as we move forward.

16:36  



Colin Smyth (South Scotland) (Lab)

I am pleased to speak in this debate, which paves the way for another of the Smith commission recommendations to be delivered. I commend the work of members of both the Environment, Climate Change and Land Reform Committee and the Delegated Powers and Law Reform Committee in scrutinising the bill. There is a great deal to welcome in it and I am happy to support the bill’s general principles.

One of the important themes to come from the Smith commission was the view that devolution cannot just be about powers transferring from one Parliament to another but must also be about devolving powers to our local councils and communities. The bill is an opportunity to halt the centralising drift that we have seen in Scotland in recent years and to enact the view of the Smith commission that the management of the Crown Estate assets in Scotland should be devolved as far as possible to our local communities. The ECCLR Committee’s report notes that

“local communities have unique local knowledge, are motivated to ensure the continued success of an asset and are likely to have imaginative ideas about how to develop that asset further in future.”

The bill makes welcome provision for both local authorities and community organisations to be managers. However, there remains a lack of clarity on what that means in practice. I therefore support the committee’s view that the Scottish Government should

“clearly outline which assets it anticipates will continue to be managed on a national basis and which can be devolved to a local level.”

In its submission to the committee, Orkney Islands Council rightly stated that the bill as currently drafted does not sufficiently deliver on the recommendations of the Smith commission and should go further. The Scottish Government must listen to local authorities and communities and respond to such concerns. It is not enough simply to give groups the legal capability to manage assets; they must be equipped with the support and guidance that they need to be able to do that in practice. In its submission to the committee, the Law Society of Scotland emphasised that

“community organisations will require access to professional advice and planning in order to properly manage assets.”

Likewise, the ECCLR Committee’s report recognised that

“ongoing advice and guidance ... will be vital in ensuring smaller community groups are able to successfully manage assets”.

Similarly, safeguards must be added to ensure that tenant farmers are not put at a disadvantage and that steps are taken to improve the standard and consistency of the support that they receive. I agree with the committee’s recommendation that priority should be given to repairs to accommodation for tenant farmers and their families. However, that must be funded sustainably. In recent weeks, we have seen the Crown Estate selling off tenanted farms to fund investment while other public agencies are looking for land to help young people make a start in farming. I appreciate that there are financial challenges facing Crown Estate Scotland, but selling off tenanted farms to fund other investment is a short-term, unsustainable fix.

As well as looking at who is managing assets, however, we must consider how they are run. I am glad that the bill seeks to expand the objectives of those managing the estate to include other considerations, namely economic development, regeneration, social wellbeing, environmental wellbeing and sustainable development. That broadened remit is a welcome improvement, but the provision needs to be strengthened. Under the bill’s current wording, although managers “must” seek to enhance the value and profitability of assets, they “may” do so in a way that promotes those other objectives, which means that there is no real requirement for those objectives to be given any consideration. In its submission to the committee, Highlands and Islands Enterprise expressed concerns that the current wording might

“make it very difficult, if not impossible, for managers to take account of the wider benefits”.

Similarly, Professor Ross and Professor Reid of the University of Dundee stated that the provision

“gives undue pre-eminence to pursuing economic interests over other concerns.”

The reality is that other considerations will be consistently overlooked in favour of profitability if the provision is not strengthened. I am pleased that the Government recognises that point in its response to the ECCLR Committee’s report.

Related to that is the need to define more clearly what constitutes good management of Crown Estate assets. I support the ECCLR Committee’s recommendation that a definition that reflects

“the wider public objectives, including socio-economic, environmental and sustainable development considerations”

should be set out. Therefore, I am disappointed that the Government has indicated that it does not plan to include such a definition in the bill. I hope that, at the very least, it will commit to including a definition in the guidance.

The transition period will create uncertainty for existing Crown Estate Scotland staff. I echo the ECCLR Committee’s recommendation that

“staff should be provided with a realistic indication of how their role might change, or not, as a result of the Bill”,

and that staff should

“be meaningfully consulted and engaged in planning processes both now and following the passage of the ... Bill.”

I am pleased that the Government has provided a positive response to those recommendations, and I hope that that means that there will be full and proper discussions with the relevant trade unions.

I am happy to support the general principles of the bill. However, I hope that the points that have been raised by the two committees and by members across the chamber will be taken on board by the Government. I look forward to seeing more detail—and, indeed, amendments—on the plans as the bill moves forward.

16:41  



Angus MacDonald (Falkirk East) (SNP)

As a member of the ECCLR Committee, I am pleased to speak in today’s stage 1 debate, not least because the bill is a welcome step forward from previous work that Parliament has done on community empowerment.

Before I speak about the report, I place on record my disappointment and frustration, along with that of my colleague Richard Lochhead, that Edinburgh’s Fort Kinnaird retail park, which the Crown Estate has, or had, a 50 per cent stake in was not included in the transfer to Crown Estate Scotland, despite the calls in 2015 from the Scottish Government to the UK Government for the retail park to be included. The UK Government signalled that it had no intention of doing so, and two weeks ago, on 7 June, we found out exactly why when it was announced that M&G Real Estate had acquired the Crown Estate’s 50 per cent stake in Fort Kinnaird in a £167 million deal. I cannot help feeling a tad bitter about that, not least because, as I understand it, that £167 million could have been used to cross-subsidise other CES assets, such as the Glenlivet, Fochabers, Applegirth and Whitehill estates. I am sure that the tenant farmers on those four estates would have welcomed capital investment to improve their farm buildings—and, indeed, their farm houses—and ensure that the farming units are fit for purpose to meet tenants’ needs.

As it stands, Crown Estate Scotland will see none of that £167 million, which is another prime example—along with the convergence uplift money, which has not come to Scotland as it should have done—of Scotland being short changed yet again. Perhaps if that had not been the case, there would have been no need for Crown Estate Scotland to consider selling off Auchenhalrig farm on the Fochabers estate, with an asking price of more than £1.6 million, which will remove land from the tenanted sector. The Scottish Tenant Farmers Association has described that as a “grave error”, considering the scarcity of available land to let. I understand that the STFA has written to the cabinet secretary to that effect.

I go back to my original point: if one of the reasons for putting Auchenhalrig on the market is to raise the investment that is required to bring the buildings and fixed equipment up to tenantable condition, the £167 million from the Fort Kinnaird sale, had it been available, could have helped to avoid the sale of much-needed tenanted land. However, we are where we are. I am sure that members can understand the frustration that I feel that Crown Estate Scotland is being forced to sell off tenanted land when that could have been avoided if the UK Government had agreed to the transfer of the stake in Fort Kinnaird.

Turning to the report, the sale of Auchenhalrig farm to cross-subsidise other assets highlights the need for an audit of existing Crown Estate assets. The committee was surprised to hear that there is no up-to-date assessment of Crown Estate assets in Scotland. It is clear that understanding the current state of assets and the cost involved in addressing any issues is vital to determining the value of the assets and associated liabilities. It is also a necessary starting point for identifying a future programme of work and investment. The committee has therefore recommended that the bill

“makes specific provision for the creation of a ‘record of condition’ of Scottish Crown estate assets that identifies the cost to address issues and places a requirement on the Scottish Crown Estate to ensure that ... assets are properly maintained.”

The idea of such an audit was warmly welcomed by tenants. However, they were clear that the audit should be designed and co-produced with them, and that it should not be a top-down exercise with no input from them. That would help to address a perception, which seems a valid one, that problems, some of which are of very long standing, are often picked up only when they are reported by tenants and that they are budgeted for only then. Tenants suggested that planning proactively now will help to budget for better maintenance in the future. That makes sense to me.

The committee has also recommended that the record of condition

“should be reviewed on a regular basis”

and that

“tenants must be involved in agreeing a schedule of works for repairs. Priority should be given to repairs to accommodation for tenant farmers and their families and agreed repairs should be carried out without unreasonable delay.”

The condition of accommodation for tenant farmers was an issue that came to light in the previous parliamentary session when the Rural Affairs, Climate Change and Environment Committee took evidence on the Land Reform (Scotland) Bill. It is clear that it would be good if Crown Estate Scotland could lead by example in that regard and ensure that dilapidated outbuildings and accommodation are made fit for purpose. The committee looks forward to amendments being lodged at stage 2 to address those issues.

I had hoped to touch on devolving the management of some Crown Estate Scotland assets to local authorities and community organisations, particularly given that that was a significant recommendation of the Smith commission; suffice to say that the inclusion of that in the bill is very welcome.

Given the time constraints on us, I will leave it at that.

16:46  



Edward Mountain (Highlands and Islands) (Con)

I welcome this stage 1 debate on the Scottish Crown Estate Bill and join my Conservative colleagues in supporting the bill in principle. Before anyone corrects me, I declare an interest: I am a member of a farming partnership.

In the our islands, our future campaign, Orkney, Shetland and the Western Isles made the case for more local control of the Crown estate. That was evident to me as a member of the Rural Economy and Connectivity Committee when I visited the islands. When the committee visited Orkney and the Western Isles, there was a general appetite for double devolution. Expectations on the islands are indeed high, and many islanders believe that the Scottish Crown Estate Bill along with the Islands (Scotland) Bill will allow island communities to assume control over Crown Estate assets. However, I caution the Scottish Government to think very carefully about how it will enable double devolution to the islands without compromising the big picture. In particular, it needs to consider how devolving the sea bed to the three island councils can be done without comprehensive guidance. Unless that guidance exists, the best outcome might not result. After all, the sea bed is an asset that benefits all users, not just the islands.

The Scottish Conservatives support double devolution to the islands in principle, but we are concerned about the dangers of fragmentation. If there is to be more local control, that must be accompanied by an overarching national policy that safeguards the assets that we believe are there. The last thing that I want to see is the complete break-up of the Scottish Crown Estate, with assets either being sold off or put out on long and irrevocable leases that we have no control over.

It is clear to me that the tenant farmers at Glenlivet, Fochabers, Applegirth and Whitehill are satisfied with the current arrangements that were established by Crown Estate Scotland (Interim Management). The setting up of rural working groups has proved popular, and tenants feel that the Crown Estate is more accessible and responsive to local issues than it has ever been before. Tenants want further devolution.

Claudia Beamish

Does Edward Mountain agree that it is very important that the tenants on each of the four estates should have an equal opportunity to get the same repairs and maintenance and that we should not see Glenlivet, which some would call the jewel in the crown of the Crown Estate, as the one that gets more?

Edward Mountain

I know many of the tenant farmers at Glenlivet and Fochabers, and I know that the standard of their fixed equipment is extremely high—I sometimes look at it with a green eye. I do not know the state of the buildings on the other farms, but it is important that things are kept up to the required standard, as laid down in the leases, and that the Government ensures that that happens.

Bearing it in mind that responding to that intervention has taken up a bit of my time, I will move on to my concern that double devolution could lead to more managers and costs and less cohesion.

I welcome the minister’s reference to devolution max not being a one-size-fits-all solution. The fact that tenant farmers have found a solution that works for them—namely, a consultative approach with Crown Estate Scotland—should be welcomed.

I will mention briefly the sale of Auchenhalrig farm, which John Scott spoke about. That removes, rather than creates, an opportunity for young tenant farmers. There are young farmers across Scotland who are desperate for more tenancies to be made available, and to my mind the Scottish Government needs to reconsider whether it is appropriate to sell off Crown Estate assets.

I cautiously welcome the Scottish Crown Estate Bill at stage 1. The real test of the bill will be how it turns the recommendations of the Smith commission into reality, and I urge the Government to think carefully about how it might deliver devolution of the Crown estate to the three island councils. I also urge the Scottish Government not to sell the family silver, thereby losing assets that could work for the benefit of Scotland and its people.

16:51  



Richard Lyle (Uddingston and Bellshill) (SNP)

The bill will provide for the devolution of Crown Estate Scotland assets. Those include, but are not limited to, rural estates, mineral rights, fishing rights, urban assets, the sea bed and the foreshore.

The bill could be life changing for many of our communities and should be supported. It will bring opportunities to communities and local authorities, and, with local decision making at its heart, it will ensure that many issues that local communities considered were not being addressed will be looked at.

The bill provides for consideration of other factors, such as regeneration, social wellbeing, environmental wellbeing and sustainable development, when the management of an asset is being considered.

I was a councillor for many years and I see in the bill an opportunity for local authorities, whenever possible, to participate in decision making on the management of assets in order to potentially increase revenues and deliver better outcomes for local people and the local authority. I am sure that the bill will be welcomed by all that it affects.

Many local councils that will be affected by the bill are better placed to discuss and support local community groups that want to be involved in the management of the Crown estate. I am not suggesting for one moment that we cut up Crown Estate assets in order to satisfy certain groups; I am suggesting that, together, local groups, local authorities and existing managers look at the required development in order to enhance assets.

To me, “enhancing assets” is the operative term. The bill should be seen as a way to increase local development of and enhance the asset base. The ECCLR Committee has made various recommendations in that regard. To my knowledge, the recommendations were supported by all committee members. I am sure that the Government will take on board the committee’s primary objective, which is that the process for deciding which assets should be managed nationally and which could be devolved to a local level should be made clear.

I turn to the cross-subsidy of assets. Under the present arrangement, some assets are more profitable than others, so the usual practice of some assets subsidising others applies. The bill will provide for the transfer of assets from one manager to another, but we must be mindful of concerns about overfragmentation. If that happens, the ability of one part of the estate to cross-subsidise another will be lost. I am sure that that matter will receive the attention that it deserves as the bill moves through its various stages. In fact, the committee made various recommendations on the issue, including recommending that

“Crown Estate Scotland establish and maintain a list of assets and ... liabilities.”

During the evidence sessions, I was struck by how tenants are generally happy with the way in which Crown Estate Scotland is being run. Tenants consider that devolution has brought them significant benefits, including a greater feeling of connectivity with the Crown Estate, improved communication and more involvement in decision-making processes.

However, tenant farmers have also suggested that more work could be done on regular contact with factors and that many buildings on some estates require urgent maintenance. They consider that there are specific problems with the maintenance of rural buildings and that issues relating to upkeep are not picked up early enough. That matter should be resolved. Buildings that are in a state of dilapidation, including out-buildings and accommodation for families, should be upgraded as part of an on-going maintenance programme. In my opinion, tenants should be involved more, whether an asset is controlled and run by the Crown Estate, the local council or a local community group. Everyone must play their part locally in the improvement of assets for the benefit of all.

On offshore renewables and related assets, Scottish Renewables made it clear that some assets require to be managed on a national basis. I am sure that that will be taken into consideration, particularly when it comes to large commercial offshore wind farms. In its report, the committee noted its view that the sea bed is a national asset, which should be managed nationally and should not be sold.

The committee discussed the role of port and harbour authorities in the context of the bill. Lerwick Port Authority said that there is a need to ensure that the bill does not encroach on, or permit others to encroach on, the jurisdiction of trust ports over the harbours for which they are statutorily responsible. The committee was mindful of the potential for conflicts of interest to arise. I am sure that that will be taken into consideration.

The bill presents an opportunity to devolve more to local communities and I welcome it.

The Deputy Presiding Officer

We move to closing speeches. I am disappointed that Mr Stevenson has not graced us with his presence.

16:56  



Mark Ruskell (Mid Scotland and Fife) (Green)

Andy Wightman was right when he described the Crown estate as “a feudal relic”. It is the most surreal of Monopoly boards involving gold, mussels, the sea bed and even a missing shopping centre that the Westminster Government has sold off.

It is important that we consider the bill’s origins and purpose. Tavish Scott spoke passionately, from the experience of the communities that he represents in Shetland, about the need for local democratic control of public assets, which must be run in the public interest and in an accountable way.

A number of members quoted Councillor Heddle, from COSLA. In his letter, he said:

“like the original Scotland Act, to be a success ... the Bill will require a deliberate decision by legislators to devolve as much as possible and also to leave the door open to future devolution where circumstances change.”

It is important that we are deliberate in ensuring that local authorities and communities get the best chance to move towards new management in the public interest. It is therefore important that there is a presumption in favour of communities and councils managing Crown Estate assets. The issue will need to be considered again at stage 2.

Members have talked about sustainable development. Claudia Beamish asked what the criteria for good management will be. Good management absolutely is about sustainable development and ensuring that the livelihoods of future generations are protected because we are protecting the environment on which their economy is based. We should be looking for win-wins and growing the economy while protecting the environmental asset that sustains that economy and the communities who need livelihoods.

In that context, I am not sure that the guidance on sustainable development that the Scottish Government has committed to bringing forward at stage 2, which Graeme Dey mentioned, will be adequate. We will need to look carefully at the matter. There must be a duty in the bill to consider and deliver sustainable development.

The minister said that there will be a need to maintain and seek to enhance the value of the important assets that we are talking about, and flexibility will clearly be needed in that regard. There is a historical reinvestment rate of 9 per cent, to allow revenues to be reinvested in assets. If we are to invest in the assets, to give future generations a chance to grow their livelihoods, we might need to revisit the issue and set a much higher reinvestment level so that we can ensure that assets are there for the long term and can sustain communities.

16:59  



Alex Rowley (Mid Scotland and Fife) (Lab)

I welcome the debate and, like other members, I acknowledge the work of the Environment, Climate Change and Land Reform Committee clerks and all the people who gave up their time to provide evidence to the committee.

When we took evidence from tenant farmers, it was interesting to hear them express the view that it was good to come to the Parliament and have their voices heard. We should do more of that, as Richard Lochhead said.

Richard Lyle said that there are issues for some tenant farmers. I hope that those can be addressed and that key stakeholders such as tenants can feel empowered in the future.

As Claudia Beamish and other members made clear, when we speak about assets in the Crown estate we mean many irreplaceable national assets, which we must ensure are protected and well managed so that they provide social, economic and environmental benefits for all of Scotland. The resources themselves are extensive, so their management is of vital concern to the future of our natural environment and rural economy as well as to the energy needs of our country moving forward in the 21st century.

Like Graeme Dey and other members of the committee, I welcomed the Smith commission’s recommendation to devolve the Crown estate but, as Colin Smyth said, devolution is not about simply shifting powers from one centralised Parliament to another. I strongly believe that, where it is appropriate and there is good reason to do so, we must be willing to devolve powers from Holyrood to local government and, indeed, to local communities.

When we devolve powers, they must be devolved for a purpose. As Joe FitzPatrick said, in devolving the Crown estate, we have an opportunity to strengthen the management of assets by creating a balance between local and central decision making. In particular, the Smith commission was clear in seeking full devolution to the three Scottish island local authorities, and I urge the Scottish Government to uphold that recommendation. That sentiment is echoed by the National Trust for Scotland, which has stated that emphasis should be put on ensuring that management is devolved

“as far as practically possible”.

As John Scott said, good management is central to the successful future of the Crown estate assets. For me, key to that will be local communities having a say over the land around them. This Parliament must also have an on-going ability to hold ministers to account for the Crown Estate, and I note the strongly held view, expressed by a number of organisations, that it should not be possible for the sea bed and foreshore to be sold off in any way without the agreement of this Parliament. The committee says that it should not be sold off—full stop. I note the point that Tavish Scott made about the islands.

The bill’s attempt to widen the focus of Crown Estate management beyond the duty of securing a commercial return is a welcome development. The wider objectives in section 7 now include economic development, regeneration, social wellbeing, environmental wellbeing and sustainable development. As RSPB Scotland has stated, Scottish Crown estate assets

“should be managed in accordance with the guiding principles of sustainable development to create and maintain a strong, healthy and just society capable of living within environmental limits.”

There must be a duty to strike a balance and achieve parity between financial obligations and the wider sustainable development of the assets. Devolution of the Crown estate can create opportunities for community land ownership, which should be explored by the Scottish Government, and for new partnership working, which should be exploited to the full.

The bill is a step in the right direction, and we now have an opportunity to come together as a Parliament to strengthen it so that it delivers for the people of Scotland, first and foremost. Those assets belong to all of us, and commercial profit should never be at the forefront of managing our land.

17:04  



Finlay Carson (Galloway and West Dumfries) (Con)

I start by declaring my interest as a member of NFU Scotland, and I refer members to my entry in the register of interests.

I am pleased to have this opportunity to sum up for the Scottish Conservatives the stage 1 debate on this important piece of legislation. I reiterate my support, and that of my colleagues, for the bill in principle. However, as it goes thorough the parliamentary process, we will want to ensure that it is strengthened at stages 2 and 3 to deliver what is intended and ensure that the objectives of the Smith commission and the Crown Estate are met.

The bill has been introduced as part of the Smith commission’s recommendations, which is very refreshing on a day on which we have heard yet more nonsense about power grabs and the Scottish Government’s voice not being heard. Here we have a perfect example of extra powers and devolution in action.

I anticipate that the bill will offer benefits to local authorities, public bodies and community organisations right across Scotland by encouraging community empowerment while ensuring—as Stewart Stevenson and other members mentioned—that sustainability in its broadest sense is at the heart of the Crown Estate’s future.

Graeme Dey and Edward Mountain have concerns, as I do, about fragmentation and the possible consequential impact on the financial stability of marginal operations if the well-performing parts of the estate are sold off. An audit needs to be carried out to give a clear indication of the Crown Estate’s current and on-going assets and liabilities.

With regard to the agricultural estates, I am very concerned and surprised about the position that I understand that the Greens are to take in amendments on a presumption of devolution to local authorities. That is despite Mark Ruskell hearing the concerns that were expressed by tenants and others about the idea, which could ultimately remove the possibility of fully devolved community empowerment.

Graeme Dey

Does Finlay Carson wonder, as I do, why Mr Wightman failed to bring forward his proposals during the stage 1 consideration of the bill, when the committee could have examined them and stakeholders could have had their views on them heard? Does Mr Carson agree that that would have been more respectful of the parliamentary process and, most important, would have allowed stakeholders to have their voices heard?

Finlay Carson

I thank Mr Dey for that useful intervention, and I agree with everything that he said.

I say with all due respect to Dumfries and Galloway Council that I do not believe that it has the expertise or experience—or the desire—to be responsible for the upkeep of the resources at the Applegirth estate, for example, whereas I am confident that a group of existing tenants has exactly the skills that are required. That is why any policies to enable more control to be handed down at a local level must be accompanied by robust guidance and must be subject to careful consideration. In addition, such handing down of control must be done transparently and in conjunction with stakeholders, not least the tenants. Decentralisation should not and cannot be railroaded through against the wishes of those who ultimately matter the most, who, in this case, are the Crown Estate tenants.

Believe it or not, Mark Ruskell was at the meeting at which the committee heard that the Scottish Tenant Farmers Association is firmly of the view that it would be more appropriate for the four rural estates to be managed directly by the Scottish Government. In addition, Jim Inness of the Glenlivet estate referenced the example of Moray Council. He said:

“We do not really want things to be devolved down to councils, because Moray Council, for example, has a big enough job running its own show.”—[Official Report, Environment, Climate Change and Land Reform Committee, 30 March 2018; c 30.]

Mark Ruskell

Will the member give way on that point?

Finlay Carson

I am sorry; I do not have time.

The NFUS has rightly stated that the long-term stability and wellbeing of the rural estates and rural communities are paramount, and it shares the concerns about the devolving of assets to local authorities. The NFUS believes that local authorities simply do not have and will not be able to obtain the skill sets that are necessary to manage agricultural units. We share that opinion.

The Crown Estate’s management team at national level has a structure that is much more in tenants’ interests than control by local authorities could ever be. That is why the Scottish Conservatives agree with the Environment, Climate Change and Land Reform Committee’s unanimous recommendation—which the Greens supported—that the national management of the Crown Estate’s four rural estates should be continued.

Along with Richard Lyle, I am pleased to hear that the Crown Estate tenants have been generally happy with how Crown Estate Scotland (Interim Management) has been run, and that they feel that there is greater connectivity, improved communications and more involvement with the Crown Estate.

I believe that the expertise and experience that are currently in place represent the best solution for the upkeep of the resources at Applegirth and other rural estates, which is why it is important to retain something akin to the status quo.

Mark Ruskell

Will the member give way?

Finlay Carson

I am sorry, but I do not have time.

The Scottish Crown Estate Bill represents another important juncture in the history of the Scottish Parliament. The powers in question have been devolved to the Scottish Parliament as a result of cross-party work by the Smith commission. That is devolution in its best form, and we now must make sure that the bill meets the needs of stakeholders and that the most appropriate management structures are identified in each individual case.

I look forward to supporting the general principles of the bill shortly and to progressing it further after the summer break.

17:09  



Joe FitzPatrick

This has been an excellent debate, and the speeches that have been made across the chamber will, I am sure, give the cabinet secretary and her officials lots to reflect on. The cabinet secretary will take time to reflect on a number of the issues that have been raised. The bill team has been passing me lots of notes so, with their help, I will do my best to cover as many of the points that have been raised during the debate as I can.

Richard Lochhead

On the point about reflection, a number of members have raised the issue of Auchenhalrig farm on the Fochabers estate in my constituency, and it has also been raised by many of my constituents. Will the minister urge the cabinet secretary to reflect on the concerns that have been expressed and perhaps intervene, if that is appropriate?

If the Crown Estate is looking to raise funds, will the Scottish Government make representations to the UK Government to get back the £167 million from the Fort Kinnaird share that was declared to be a UK asset and not a Scottish asset when it came to the devolution of the Crown Estate assets? That is Scottish money and the UK Government should not be conning us out of it.

Joe FitzPatrick

The member has made two strong points. They are now on the record and the cabinet secretary will look at them both.

During the debate, Graeme Dey and Claudia Beamish made some points about the concept of good management. The bill contains a duty to maintain and enhance the value of Crown Estate assets, and the manager may do so in a way that is likely to promote socioeconomic and environmental matters. That duty is in the bill instead of a specific reference to good management, so although the words “good management” are not in the bill, it is encapsulated in that wording.

Graeme Dey also made a point about the scope of the bill and whether wider environmental factors should be taken into account. There is a duty to maintain and enhance the estate, but managers may meet that duty in a way that contributes to its economic value and to sustainable development, economic development and social wellbeing.

Graeme Dey, Mark Ruskell and Peter Chapman made points about the retention of 9 per cent of revenues by the manager. They questioned whether that is the correct figure and whether we should examine that. Although we have kept the existing figure of 9 per cent under the interim arrangements, the bill provides flexibility to vary that, and we will keep the figure of 9 per cent under review.

Tavish Scott made a specific point about trust ports and what they need to pay to the Crown Estate. There are new powers in the bill to weigh up the profit to the estate with the wider benefits. That is a new power that does not exist just now, so I hope that will help with Tavish Scott’s specific point.

Mr Scott and Mr Wightman made similar points about looking for a simpler approach, but we need to bear it in mind that management, not ownership, has been devolved. The bill will enable the local management of assets; no powers exist to do that at the moment.

Andy Wightman

Does the minister accept that subparagraph 3(1) of schedule 5 to the Scotland Act 1998 covers

“property belonging to Her Majesty in right of the Crown”?

As the Scottish Law Commission has confirmed, the Scottish Parliament has always had the right to legislate on Crown property.

Joe FitzPatrick

This specific bill relates to the devolution of powers over management.

John Scott, Claudia Beamish, Richard Lyle, Graeme Dey, Alex Rowley and others raised points about the sea bed, arguing that it should never be sold off, or different variations on that point. The bill makes it a requirement for a manager to obtain the consent of Scottish ministers before the sea bed can be sold. That is a new requirement and it goes further than ever before. The point is that there are some circumstances in which it might be the right thing to do, such as those around the sea bed under the footprint of the Queensferry crossing. We all agree that there are exceptions to that rule, so the power to sell the sea bed should remain, although there is a requirement for such cases to come to Scottish ministers, so there will be parliamentary oversight.

Andy Wightman and John Scott made points about Crown Estate staff and Scottish Government officials who are working with Crown Estate Scotland.

Claudia Beamish and Richard Lochhead both made points about transparency. The bill provides for that, and management plans will be published and accounts laid in Parliament. Those are all new things in the bill that will increase transparency.

I see that the clock is ticking. To go back to what I said at the start, the cabinet secretary will be paying close attention to everything that has been said in the debate today. If members have particular points that they want to take up with her or her officials, I am sure that she will be pleased to hear from them prior to stage 2.

The Presiding Officer (Ken Macintosh)

That concludes our stage 1 debate on the Scottish Crown Estate Bill.

Financial resolution

A financial resolution is needed for Bills that may have a large impact on the 'public purse'.

MSPs must agree to this for the bill to proceed.

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Financial resolution transcript

The Presiding Officer (Ken Macintosh)

The next item of business is consideration of motion S5M-11939, in the name of Derek Mackay, on a financial resolution for the Scottish Crown Estate Bill.

Motion moved,

That the Parliament, for the purposes of any Act of the Scottish Parliament resulting from the Scottish Crown Estate Bill, agrees to any expenditure of a kind referred to in Rule 9.12.3(b) of the Parliament’s Standing Orders arising in consequence of the Act.—[Joe FitzPatrick]

Vote at Stage 1

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Vote at Stage 1 transcript

The Presiding Officer (Ken Macintosh)

There are two questions today. The first question is, that motion S5M-12846, in the name of Roseanna Cunningham, on the Scottish Crown Estate Bill at stage 1, be agreed to.

Motion agreed to,

That the Parliament agrees to the general principles of the Scottish Crown Estate Bill.

The Presiding Officer

The next question is, that motion S5M-11939, in the name of Derek Mackay, on a financial resolution for the Scottish Crown Estate Bill, be agreed to.

Motion agreed to,

That the Parliament, for the purposes of any Act of the Scottish Parliament resulting from the Scottish Crown Estate Bill, agrees to any expenditure of a kind referred to in Rule 9.12.3(b) of the Parliament’s Standing Orders arising in consequence of the Act.

The Presiding Officer

That concludes decision time. I will suspend the meeting for a few moments to allow members to change seats and new guests to arrive in the public gallery.

17:16 Meeting suspended.  



17:17 On resuming—  



MSPs agreed that this Bill could continue

Stage 2 - Changes to detail 

MSPs can propose changes to the Bill. The changes are considered and then voted on by the committee.

Changes to the Bill

MSPs can propose changes to a Bill  these are called 'amendments'. The changes are considered then voted on by the lead committee.

The lists of proposed changes are known as a 'marshalled list'. There's a separate list for each week that the committee is looking at proposed changes.

The 'groupings' document groups amendments together based on their subject matter. It shows the order in which the amendments will be debated by the committee and in the Chamber. This is to avoid repetition in the debates.

How is it decided whether the changes go into the Bill?

When MSPs want to make a change to a Bill, they propose an 'amendment'. This sets out the changes they want to make to a specific part of the Bill.

The group of MSPs that is examining the Bill (lead committee) votes on whether it thinks each amendment should be accepted or not.

Depending on the number of amendments, this can be done during one or more meetings.

First meeting on amendments

Documents with the amendments considered at this meeting held on 18 September 2018:

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First meeting on amendments transcript

The Convener (Gillian Martin)

Welcome to the 25th meeting in 2018 of the Environment, Climate Change and Land Reform Committee. I remind everyone present to switch off their mobile phones, because they might affect the broadcasting system.

Under agenda item 1, the committee will consider the Scottish Crown Estate Bill at stage 2. I welcome the Cabinet Secretary for Environment, Climate Change and Land Reform and her officials from the Scottish Government. Mike Palmer is deputy director of aquaculture, crown estate and recreational fisheries in the European maritime and fisheries and Europe division of Marine Scotland; David Mallon is head of the crown estate strategy unit; Laura Begg is from the legal division; and Annalee Murphy is a parliamentary counsel. It should be noted that officials are not allowed to speak on the record during the proceedings.

Members might find it helpful to have a reminder of the process. Everyone should have a copy of the bill as introduced, of the marshalled list of amendments, which sets out the amendments in the order in which they will be disposed of, and of the groupings of amendments. There will be one debate on each group of amendments.

I will call the member who lodged the lead amendment in the group to speak to and move that amendment, and to speak to all the other amendments in the group. I will then call the other members who have lodged amendments in that group to speak to their amendments and to other amendments in the group, but not to move their amendments at that time.

Members who have not lodged amendments in the group but who wish to speak should indicate that to me or the clerk. If the cabinet secretary has not already spoken to the group of amendments, I will invite her to contribute to the debate just before we move to the winding-up speech. There might be times when I can allow a little more flexibility for members to come in on points during a debate. Members should indicate to me or the clerk that they want to do that.

The debate on each group will be concluded by my inviting the member who moved the first amendment in the group to wind up.

Following the debate on the group, I will check whether the member who moved the lead amendment in the group wishes to press it to a vote or to seek to withdraw it. If the member wishes to press it, I will put the question on the amendment. If the member wishes to withdraw it, I will see whether any other member objects to withdrawal. If any member objects, the amendment will not be withdrawn and the committee must immediately move to vote on it.

If any member does not wish to move their amendment when it is called, they should say, “Not moved”—they should do so audibly. Any other member who is present may move an amendment that is not moved. However, if no one moves the amendment, I will immediately call the next amendment on the marshalled list.

Only committee members are allowed to vote. Voting on divisions is by a show of hands. It is important that members keep their hands clearly raised until the clerks have recorded the vote.

The committee is required to indicate formally that it has considered and agreed to each section of the bill, so I will put the question on each section at the appropriate point.

I hope that that is all clear to everybody.

Section 1—Crown Estate Scotland

Section 1 agreed to.

Schedule 1—Crown Estate Scotland: modification of enactments

The Convener

Amendment 1, in the name of the cabinet secretary, is grouped with amendments 7, 8, 19 to 21, 23, 24, 28 and 29. If amendment 8 is agreed to, I cannot call amendment 35 in the group on the management of marine assets. I invite the cabinet secretary to move amendment 1 and to speak to all the amendments in the group.

The Cabinet Secretary for Environment, Climate Change and Land Reform (Roseanna Cunningham)

Thank you, convener, and welcome to your new post.

The amendments in the group are all of a minor or technical nature. Amendment 1 is a technical amendment that would take account of two new acts—the Gender Representation on Public Boards (Scotland) Act 2018 and the Islands (Scotland) Act 2018—that were passed by the Scottish Parliament after the introduction of the Scottish Crown Estate Bill. The amendment would insert provision to adjust references to “Crown Estate Scotland (Interim Management)” in those two acts, as a result of the renaming of “Crown Estate Scotland (Interim Management)” by section 1 of the bill to “Crown Estate Scotland”.

Amendments 7 and 8 have been lodged in response to parliamentary feedback at stage 1 and because of my commitment to ensuring that section 4 is sufficiently clear to give effect to the intention that Scottish ministers should not be able to direct a manager of an asset to delegate the management function of a Scottish Crown Estate asset to the Scottish ministers. I am pleased to have lodged amendment 7 to address that matter. It will clarify that the Scottish ministers and, furthermore, Crown Estate Scotland are not persons to whom the function of managing a Scottish Crown Estate asset may be delegated under section 4(1).

Amendment 8 is a consequential amendment and, as the convener has pointed out, agreement to it will result in pre-emption of amendment 35.

Amendment 19 is a minor drafting amendment. The duty to obtain at least market value for a “transfer of ownership” or “grant of a lease” and so on could be departed from if the manager is satisfied that the transaction is likely to contribute to the promotion or improvement of any of the socioeconomic or environmental factors that are listed in paragraphs (a) to (e) of section 11(2). The inclusion of an “or” in that list will make it clear that the list is not cumulative and that a transaction may be made for less than market value if any of the listed factors are relevant.

There are references to the “Crown Estate Transfer Scheme” in the bill. We think that it is neater to provide a definition of the transfer scheme in the interpretation section of the bill, as has been done with the Crown Estate Scotland (Interim Management) Order 2017. That will avoid the need to repeat the title of the statutory instrument in full, along with the number, every time the bill refers to the transfer scheme. Amendment 29, therefore, will insert a definition of the “Crown Estate Transfer Scheme” into section 43, and amendments 20, 21 and 23 will consequentially remove the full title and number of the transfer scheme from sections 11, 12 and 24.

Section 25 requires the Scottish ministers to

“lay a copy of each annual report”

that is prepared by a manager

“before the Scottish Parliament.”

The bill as drafted would prevent Crown Estate Scotland and other managers from publishing their own annual reports until the Scottish ministers had laid a copy of their report under section 25.

Section 37 of the bill allows the Scottish ministers to delegate some of their functions, including the laying of annual reports, to Crown Estate Scotland. To take account of that possibility, amendments 24 and 28 will make adjustments that will refer instead to managers being prevented from publishing their own annual report until after it has been laid before the Scottish Parliament, to reflect the fact that annual reports may be laid before the Scottish Parliament by the Scottish ministers or by Crown Estate Scotland.

The bill is technical and the amendments in the grouping are technical.

I move amendment 1.

Claudia Beamish (South Scotland) (Lab)

I want to highlight that, although I appreciate that gender representation on public boards is a legal obligation, I am pleased to see it being included in this context.

Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

I may not have fully woken up and the question may be a dumb one. I would like confirmation that schedule 1, which is the list of bills to which we are adding through amendment 1, is capable of further amendment by order after the bill is passed.

Roseanna Cunningham

Yes, it is.

The Convener

No other members have comments. I invite the cabinet secretary to wind up.

Roseanna Cunningham

I have nothing further to add.

Amendment 1 agreed to.

Schedule 1, as amended, agreed to.

Section 2 agreed to.

Section 3—Transfer of management function

The Convener

Amendment 30, in the name of Andy Wightman, is grouped with amendments 31 to 36, 25 and 26.

Andy Wightman (Lothian) (Green)

The amendments in my name in this group make two propositions. The first is set out in amendments 30 and 31 and the second in amendments 32 and 33. I will deal with each set of amendments in turn.

The Smith commission recommended in paragraph 33 of its final report that, following the devolution of the management of the Crown estate,

“responsibility for the management of those assets will be further devolved to local authority areas”.

As drafted, section 3 gives authority to ministers to make regulations to transfer those management functions to any person mentioned in subsection (2). It remains possible that ministers may not choose to make regulations, or may choose to revoke any regulations that are made. In addition, it remains possible that regulations may be drafted in a way that makes the transfer of management functions unduly onerous and complex. Those are all questions to which there are no clear answers. They are possibilities in the future.

The Smith commission recommendation makes clear, however, that the responsibility “will be” further devolved to local authorities. Amendment 30 is designed to uphold that cross-party agreement. It provides that the transfer of management functions in relation to the foreshore is a statutory right, which regulations must be designed to facilitate, as amendment 31 makes clear.

Why does this relate only to the foreshore? It is one of the distinctive ancient Crown property rights. Ownership by the Crown is regarded by the Scottish Law Commission as a patrimonial right derived from the Crown prerogative. That is nowhere defined in statute, but it is, as the commission notes, the “predominant modern theory”. It plays a distinct and critical role in coastal management, a function that more widely falls into the realm of local authorities. Its history, as set out in a recent book by John MacAskill published by Edinburgh University Press, is one in which the public interest in the foreshore has frequently been compromised by the long-standing requirement to, among other things, obtain best consideration from any sale or lease.

Amendment 30 is designed to fulfil the recommendation of the Smith commission by providing that the transfer of management functions is as of right and not, as currently drafted, in the gift of ministers. If agreed, I propose to bring forward subsequent amendments at stage 3 to the effect that any transfer of functions to local authorities relating to the foreshore will be exempt from the direction-making powers under section 4 and from certain functions imposed by other sections. That is for the future.

Local authorities should be free to manage the foreshore in a manner best judged by them to fulfil their responsibilities and the wishes of their electorate. That is what amendments 30 and 31 seek.

I now turn to the second set of amendments in my name—amendments 32 to 36. Amendments 32 and 33 are substantive and 34 to 36 are consequential. Amendments 32 and 33 achieve the same purpose, first in relation to the sea bed and secondly in relation to the foreshore.

The history of management of the foreshore and the sea bed around Scotland’s coasts has often been one of conflict between the aspirations of local communities, local authorities and harbour authorities on the one hand, and the Crown Estate Commissioners on the other. Devolution should, I hope, change that.

09:45  



Of Scotland’s 375 harbours and ports, 241 are owned and managed by local authorities, 24 are owned by other public authorities, including Scottish ministers, and 33 are trust ports. They all operate under a statutory framework that is intended to secure the public interest and they are critical to Scotland’s marine economy. Schedule 5 to the Crown Estate Transfer Scheme 2017 highlights the role of Crown land in relation to those harbours, as it amends a large number of statutes, including the Pittenweem Harbour Order Confirmation Act 1992, the Lerwick Harbour Act 1994, confirmation orders for the Berneray causeway, the Macduff Harbour Revision Order 1999 and the Scottish Natural Heritage (Rum) Harbour Empowerment Order 1999.

The committee recommended in its stage 1 report that the bill should be amended to ensure that the sea bed cannot be sold. In section 10, the bill provides that that is possible with the consent of Scottish ministers, and in any event a lease of up to 150 years is permitted under section 14. Scotland’s ports and harbours are routinely and actively engaged in development activity by way of building new slips, piers, harbour walls and breakwaters that involves securing legal agreements with the Crown over the sea bed and, less frequently, the foreshore.

Amendments 32 and 33 are designed to make it obligatory that section 3 regulations transfer the management of the sea bed and the foreshore, provided that it is in the public interest to do so. I was minded to frame this provision in relation to ownership of the foreshore and sea bed but, given that the bill continues to permit the alienation of the sea bed on leases of up to 150 years, and given that no amendments have been lodged to deliver on the committee’s recommendation at stage 1, I have framed it in such a way that that statutory right is created for the transfer of management functions only. My view, however, is that such a scheme should include the circumstances in which ownership would also be transferred, given that lenders—for example, a Norwegian bank willing to lend £10 million to Lerwick Port Authority—might not be content with the security that rests on mere management, or indeed a long lease. If the minister is minded to agree with the principle underlying the amendments, I would be keen to explore how the provision could be extended to cover cases where the port or harbour requires ownership of the sea bed or foreshore to be transferred.

I move amendment 30.

Roseanna Cunningham

The bill includes powers for the Scottish ministers to devolve management responsibilities in respect of Scottish Crown estate assets and opens up the possibility for local authorities and community organisations to take on the management of assets in their areas. That is a key principle of the bill that was supported by the Environment, Climate Change and Land Reform Committee following its consideration at stage 1.

I wish to respond to Andy Wightman’s amendments before I go on to the Government amendment, because amendment 30 cuts right across the proposal that a community organisation could take on management of an area of the foreshore, as it would restrict those that could take on that management function to local authorities. Amendments 31 and 32 seek to restrict the power to make transfer regulations, as they seek to compel Scottish ministers to make regulations under section 3(1) transferring the function of managing assets relating to the sea bed to a local authority or a trust port if it is in the public interest to do so. However, that fails to take into account that not all local authorities may have the desire to take on the management of an asset. It also fails to give due weight to the fact that another person, such as a community organisation, may in fact be better placed and could demonstrate wider public benefits in managing such an asset.

As we speak, Crown Estate Scotland interim management are considering applications for pilots of local asset management. The scheme will test different approaches to local management and inform how aspects of the bill may be best implemented. The scheme is a clear indicator of community interest in management, and more than half of the 13 applications are from organisations that are not councils or trust ports. Amendments 31 and 32 would effectively prevent community organisations from becoming managers of those assets and, as I indicated, cut right across the pilot scheme process and a key provision of the bill.

It is my clear intention to use the new powers in the bill to enable further devolution of management on a case-by-case basis. That will allow decisions to be taken carefully, while recognising that a one-size-fits-all approach is simply not suited to such a diverse range of assets.

It is not clear, under amendment 32, who would determine whether the transfer would be in the public interest, and the amendment does not define the sea bed either.

The bill already establishes a process for the transfer by regulations, and it is unclear how the consultation obligation that is provided for in the amendment would work in this context.

Amendment 32 would, in particular, result in a more fragmented distribution of policing responsibilities out to 200 nautical miles, and representatives of offshore activities have expressed concerns about councils taking on sea bed leasing functions that are currently managed at the national level.

There is an overlap between amendment 32, on the sea bed, and amendment 33, which relates to the foreshore because, typically, the sea bed is understood to also include the foreshore. Amendment 33 does not contain a definition of the foreshore.

These amendments will remove ministers’ discretion regarding the management of the sea bed and foreshore.

I also consider amendments 34 to 36 to be unnecessary, as provisions in the bill under section 6(1)(b) could be used to enable one or more trust ports to be eligible to become a manager if it were designated by the Scottish ministers as a community organisation.

There are also potential definitional difficulties associated with amendments 34 to 36, as they add only trust ports to the list of eligible delegates and transferees. At present, there are other types of port that exercise public functions and could, therefore, potentially seek to manage Scottish Crown estate assets.

For those reasons, I urge Mr Wightman not to press amendment 30 and not to move the other amendments in his name. If he wishes to contact me about his concerns about the ability of a trust port to become a manager, I will be happy to meet him to discuss the matter in advance of stage 3.

With regard to the Government’s amendment 25, the Delegated Powers and Law Reform Committee and the Environment, Climate Change and Land Reform Committee requested that Parliament have the ability to scrutinise the content of regulations transferring the management of Scottish Crown estates by the affirmative procedure if the regulations were transferring the management of an asset of significance or of significant value. I recognise that concern and accept that the recommendations that a definition of what would constitute significance or significant value in relation to an asset should be set out in the bill, and also that the affirmative procedure should apply to regulations that would transfer the management of such an asset.

I have reached the conclusion that the transfer of the management of any part of the sea bed, except where it is the foreshore, is one of significance or significant value. The potential impact on third parties, such as mariners, is significant, as is the potential or actual financial value and the wider economic and environmental significance of the assets.

The amendment ensures that the affirmative procedure will apply to any transfer of management of strategic national infrastructure, such as cables and pipelines, offshore wind, tidal and wave energy and carbon capture and storage.

What constitutes part of the sea bed has been defined in the amendment, and includes the Scottish marine area that is that part of the sea bed out to the 12 nautical mile limit, and the Scottish zone, which lies between the 12 nautical mile limit and the 200 nautical mile limit. The Scottish zone is not owned by the Crown, but international maritime law gives a coastal state the rights in that zone, and those have been vested in the Crown. Marine assets that lie solely within the foreshore area, which is the land that lies between the high-water and low-water marks of ordinary spring tides, are not considered to be assets of significance or significant value and will therefore be subject to the negative procedure.

Amendment 26 is consequential on amendment 25.

I urge members to support amendments 25 and 26 in this group and I urge Andy Wightman not to press amendments 30 to 36.

Stewart Stevenson

Before I raise my particular issue, I pick up Mr Wightman’s point about leases and whether they can be used as assets for bank borrowing. The maximum length of a lease is 175 years, which is set out in the Long Leases (Scotland) Act 2012. Mr Wightman and I both worked on the bill, so we are familiar with the act. Banks are much more imaginative in what they will lend money against. They habitually lend against long leases, which can, of course, be registered. I remember being at a Bank of Scotland board meeting in which there was a discussion about lending money against an asset that was two storeys of a building in Manhattan that had not been built but which the owner of the building had consent to build. That consent could be transferred to someone else, because the maximum height in Manhattan is six storeys and, although there are skyscrapers, in order to build higher you need to buy the rights from others. That was an asset, even though it was nothing but clear air and had no physical manifestation. Therefore, banks are much less worried than Mr Wightman makes out.

My substantial issue relates to amendments 32 and 33 and the definition of “trust port” that Mr Wightman uses. Proposed new subsection (1E) in amendment 32 says:

“In this Part a ‘trust port’ means a harbour authority other than one within subsection (1F) below.

Those are then listed. An item in the list is

“any company having a share capital”.

Mr Wightman has told us that we have 33 trust ports. I do not know what they are but, before I came here, I looked at the structure of Aberdeen Harbour, which most of us think of as being a trust port. However, according to Companies House, there is one share in the organisation, which is owned by the Aberdeen Harbour Board. The organisation’s structure is complex. I understand that the Aberdeen Harbour Board is not an executive board but a non-executive board. Therefore, the powers and the assets would be attributable to the company that has a shareholding.

My research on the issue may not be entirely complete, but what I have done indicates that Mr Wightman’s definition may introduce difficulties and exclude some ports that we imagine to be trust ports. I suspect that that is not his intention.

The construction that is used in proposed new subsections (1E) and (1F) in amendment 32 is repeated in amendment 33.

Obviously, the further references to trust ports depend on the definition of a trust port in those subsections. However, although amendments 34 to 36 refer to “a trust port”, I am not entirely clear what definition of “a trust port” is being used, because the definition that is used in proposed new subsection (1E) in amendment 32 and proposed new subsection (1E) in amendment 33 is restricted to “In this Part”. I know that those subsections are identical but, in drafting terms, there is a little bit of confusion about that. Of course, that confusion may be only in my mind, so I will wait for a response to that.

Claudia Beamish

These are complex issues. I preface my short remarks by saying that the issue on which I agree with Andy Wightman—and on which our committee agrees and the Scottish Government agrees—is the Smith commission’s statement that there should be further devolution. That is an important marker for these amendments.

I will be open and say that when I came to the debate, I was in agreement with amendment 30, because it is important that these issues are more robustly devolved to local authorities. However, I have listened carefully and, in view of the cabinet secretary’s comments on amendment 30, I believe that, at this stage, it is important that we recall our other deliberations in committee. It also happens that my role as the spokesperson for land reform is to argue that the devolution of land to communities is vital, and I would not want that to be affected in any way by the amendment.

I am not saying that I understand all the complexities of the issue in the way that others appear to and I am sure do, but I ask Andy Wightman to consider not pressing amendment 30 and the associated amendments, especially in view of the cabinet secretary’s offer of further discussion.

10:00  



I want to quickly highlight another important issue. I am glad that it is recognised that tenant farmers and rural estates have concern about the devolution to local authorities. I know that Andy Wightman’s amendments do not cover that, but it is important to point that out.

After discussion with my colleague Alex Rowley, we had thought that we would vote for amendment 32, but I again ask Andy Wightman to consider holding back at this stage in view of the cabinet secretary’s offer. Amendment 32 is important because of the possibilities for trust ports and, indeed, local authority ports and harbours to have the power to do what they want to do without being radically held up, which I understand is one of the issues. On the other hand, after hearing about the follow-on amendments, I think that the issues need discussing and refining, which is perhaps the purpose of stage 2.

I support the cabinet secretary’s amendment 25. The division between affirmative and negative procedure that it sets out is appropriate.

Richard Lyle (Uddingston and Bellshill) (SNP)

Anyone who knows Andy Wightman knows that he is a champion of community ownership, but I agree with my colleagues on his amendments. To my mind, if we agree to them, we will deny community organisations the opportunity to manage the foreshore. I do not believe that Andy Wightman’s amendments go to the heart of what he really wants to achieve, so I ask him not to press them and to take up the offer of discussions with the cabinet secretary on the points that he wants to make.

John Scott (Ayr) (Con)

My point is similar to what Richard Lyle and Claudia Beamish have said. I have sympathy with Andy Wightman’s idea of further devolution and growing trust ports, but it appears from what the cabinet secretary has said that the proposals are incomplete and would not achieve Andy Wightman’s ambitions. He should accept the cabinet secretary’s offer, not press his amendments and work to bring forward amendments at stage 3.

I, too, welcome amendment 25, which introduces the affirmative procedure in some cases. I agree with Claudia Beamish that the balance is now correct.

The Convener

I invite Andy Wightman to wind up and to say whether he wishes to press or withdraw amendment 30.

Roseanna Cunningham

Convener, can I just say something before that? It might be helpful for the committee to hear who has expressed an interest so far—the 13 applications that are already in. Would members find that helpful?

The Convener

Yes.

Roseanna Cunningham

They are from: Clyde Fishermen’s Association and Clyde Fishermen’s Trust; Western Isles Council; the Community Inshore Fisheries Alliance; the Findhorn Village Conservation Company; Forth District Salmon Fishery Board; Galson Estate Trust; Lochgoilhead Mooring Association and Lochgoilhead Jetty Trust; Mallaig Harbour Authority; Orkney Islands Council; Portgordon Community Harbour Group; Shetland Islands Council; St Abbs and Eyemouth Voluntary Marine Reserve Committee; and the Tay and Earn Trust. Therefore, of those who are expressing an interest thus far, only three are local authorities and only one on the list—Mallaig Harbour Authority—is a trust port.

The Convener

I invite Andy Wightman to sum up and to say whether he wishes to press or withdraw amendment 30.

Andy Wightman

I thank members for their contributions to the debate on this group. A number of members raised technical drafting points, as is to be expected at stage 2, but I am interested in testing the substance of the propositions.

I remind members that the Smith commission’s recommendation was not about whether the Crown estate should or would be devolved but said, “Responsibility … will be transferred”. I take the points that have been made about community bodies, but there is nothing to prevent local authorities from further delegating the responsibilities to community bodies. I have never taken the view that ministers should determine such things. Indeed, I have never taken the view that ministers should determine community right-to-buy applications. Ministers have far too much discretion and control over such matters.

Amendments 30 and 31 are designed to fulfil the spirit of the Smith commission’s recommendation. In other words, they are designed to provide a statutory right to ensure that the regulation-making power in section 3 is used to fulfil the commission’s recommendation that local authorities have the right to manage the foreshore. Neither as the bill stands nor under my amendment would there be any obligation on local authorities to take on board those management functions, so those that do not wish to would have no need to do so.

The debate on trust ports is important. I do not agree with the cabinet secretary that they are community bodies that can be added by order under section 6. They were established in the 19th century by statute and are statutory bodies with a well-understood statutory framework. It is important that they should have the right to have management functions for, or the ownership of, the sea bed transferred to them and I welcome the cabinet secretary’s offer to discuss that further. I do not propose in amendment 32 that any rights to the sea bed be granted outwith a port’s normal area of operations, which are already defined in statute. All ports and harbours have lines on maps by which their existing authority to dredge and set up moorings is defined.

Given the range of views that have been expressed on the amendments in this group and the cabinet secretary’s willingness to sit down and talk about the issues that I have raised, I will not press amendment 30 or the others in my name in the group.

Amendment 30, by agreement, withdrawn.

Amendments 31 to 34 not moved.

The Convener

Amendment 2, in the name of the cabinet secretary, is grouped with amendment 16.

Roseanna Cunningham

Scottish public authorities are one category of persons who are eligible to become managers of Scottish Crown Estate assets. The bill does not define what a Scottish public authority is and relies on the definition in the Interpretation and Legislative Reform (Scotland) Act 2010. Using that definition potentially includes cross-border public authorities, of which there are only two—the traffic commissioner for Scotland and Citizens Advice Scotland—neither of which would be expected to become a manager.

The intention is not to transfer the function of managing Scottish Crown Estate assets to any cross-border public authority that is a Scottish public authority—that is, one that exercises functions

“only in or as regards Scotland”.

Therefore, amendments 2 and 16 provide that the references to transfer or delegation of functions to Scottish public authorities are restricted to those public authorities

“with mixed functions or no reserved functions (within the meaning of the Scotland Act 1998)”.

That avoids any suggestion that Scottish ministers intend to transfer management functions to cross-border public authorities.

I encourage members to support the amendments.

I move amendment 2.

Amendment 2 agreed to.

The Convener

Amendment 3 is grouped with amendments 4 and 6.

Roseanna Cunningham

This set of Scottish Government amendments has been lodged because we identified a need to ensure that the relevant provisions of the bill permit Scottish ministers to impose requirements on Scottish Crown Estate asset managers for the treatment of records.

Part 1 of the Public Records (Scotland) Act 2011 already places obligations on the majority of Scottish public bodies in respect of the management of public records, such as the keeping, securing and preservation of such records. The obligations would apply to a number of bodies that might become Scottish Crown Estate asset managers, including local authorities, Crown Estate Scotland and Scottish ministers. The 2011 act does not, however, apply to community organisations or some other public authorities. As that would create a gap in the management of some records relating to the management of some Scottish Crown Estate assets, depending on who manages them, I have concluded that the bill should contain a provision to permit Scottish ministers to impose similar requirements on other Scottish Crown Estate managers that are not caught under the 2011 act as regards the management of records.

Amendments 3, 4 and 6 amend the bill to make it clear that Scottish ministers, when making regulations under section 3(1)(a), may make provisions about the management of records relating to the exercise of the transferee’s functions as a manager. Proposed new section 3(7) provides a definition of the management of records that confirms that

“keeping, storage, securing, archiving, preservation, destruction or other disposal”

are all included in the power to make provision about the management of records. I encourage members to support the amendments.

I move amendment 3.

Amendment 3 agreed to.

Amendment 4 moved—[Roseanna Cunningham]—and agreed to.

The Convener

Amendment 5 is in a group on its own.

Roseanna Cunningham

Section 3(4) of the bill as introduced contains a power to make regulations to transfer the management of an asset or any associated rights or liabilities that had been transferred to a community organisation by way of regulation, in the event that that community organisation ceases to exist, to another person who is eligible to become a manager of a Scottish Crown Estate asset. There is also the possibility that a manager might dispose of any such asset or acquire new rights and liabilities during the intervening period, or that a community organisation might still be responsible for rights and liabilities relating to former assets when it ceases to exist.

To take into account those possible scenarios, amendment 5 adjusts section 3(4)(a) to allow transfer regulations to make provision when a community organisation ceases to exist to transfer the function of managing any Scottish Crown Estate asset and any right or liability that the manager might have in relation to a Scottish Crown Estate asset or a former Scottish Crown Estate asset to another eligible manager.

I move amendment 5.

Amendment 5 agreed to.

Amendment 6 moved—[Roseanna Cunningham]—and agreed to.

Section 3, as amended, agreed to.

Section 4—Directions requiring delegation of management function

10:15  



Amendment 7 moved—[Roseanna Cunningham]—and agreed to.

Amendment 8 moved—[Roseanna Cunningham].

The Convener

I remind members that if amendment 8 is agreed to, I cannot call amendment 35.

Amendment 8 agreed to.

The Convener

Amendment 9, in the name of the cabinet secretary, is grouped with amendments 10 to 15.

Roseanna Cunningham

This group of Scottish Government amendments has been lodged in response to recommendations at stage 1 from the Delegated Powers and Law Reform Committee and the Environment, Climate Change and Land Reform Committee.

Amendment 9 addresses the desire to strengthen engagement with potential asset managers and other interested parties as part of the delegation process. Sections 3 and 4 confer on the Scottish ministers the ability, by way of two distinct methods—transfer and delegation—to pass the management function of Scottish Crown Estate assets to another person. In respect of the ability to transfer management functions, section 3(5) places a duty on Scottish ministers to consult certain interested persons prior to making regulations that transfer the function of managing a Scottish Crown Estate asset.

Amendment 9 places a duty on the Scottish ministers to carry out a similar consultation process prior to giving a direction requiring the delegation of management functions. That will facilitate increased engagement with relevant parties, which we consider to be of particular benefit, as delegation of a management function is likely to be a method by which community organisations take on management functions. Amendment 9 ensures that stakeholders are involved in the process, that the views and opinions of potential managers are heard and that they have a greater ability to provide supporting evidence. That will enhance the information and evidence available to Scottish ministers during the delegation process, which will inform the decision-making process itself. Amendment 10 requires the same consultation to be carried out before revising or revoking any delegation direction, and it also requires the consent of the proposed delegate for such a revision or revocation.

Both the Delegated Powers and Law Reform Committee and the Environment, Climate Change and Land Reform Committee sought clarification of the types of information that would be published in the notice of direction under section 4. Amendment 11 confirms the intention outlined in my letter to the Delegated Powers and Law Reform Committee to amend the bill so that the direction itself is published rather than a notice of direction. As introduced, the bill requires no publication of the revision of a direction, but as a result of amendment 12, Scottish ministers will be required to publish the revised direction.

Amendment 13 is consequential on amendment 11 to continue to provide that a notice of a revocation of a direction be required rather than the revocation itself. Amendment 14, too, is consequential on amendment 11 and provides that the information that must be included in a published direction is: the fact that a direction has been given; the manager to whom the direction or revised direction has been given; the proposed delegate of the function of managing an asset; and the asset in relation to which the direction or revised direction has been given. Information might be regarded as being commercially sensitive or commercially confidential depending on individual circumstances, and that will be assessed on a case-by-case basis. In certain circumstances, it might be necessary to withhold such information from publication. Finally, amendment 15 tidies up the drafting of section 4(7)(b) as a consequence of amendment 14.

I encourage members to support the amendments.

I move amendment 9.

Amendment 9 agreed to.

Amendments 10 to 15 moved—[Roseanna Cunningham]—and agreed to.

Section 4, as amended, agreed to.

Section 5—Delegation agreements

Amendment 36 not moved.

Amendment 16 moved—[Roseanna Cunningham]—and agreed to.

Section 5, as amended, agreed to.

Section 6—Meaning of “community organisation”

The Convener

Amendment 17, in the name of the cabinet secretary, is in a group on its own.

Roseanna Cunningham

Amendment 17 will amend the definition in section 6(1)(b) of community organisations that are eligible to become Scottish Crown Estate managers, so that the Scottish ministers may designate a body as a community organisation for the purposes of the bill only if it is an incorporated body. An unincorporated organisation has no separate legal personality from its members. If an unincorporated community organisation were to be able to take on the management functions of a Scottish Crown Estate asset, that would cause problems if it wished to enter into contracts, to own property or to engage employees. It could not contract in its own name so, as a result, individual members rather than the organisation itself would have to enter into contracts.

There is a risk that office holders and sometimes even members of unincorporated organisations would incur personal liability with potentially serious financial consequences—for example, liabilities under a contract that had been entered into on the organisation’s behalf, for certain criminal offences that the organisation had committed, such as health and safety offences, or to compensate third parties who had suffered injury while using the Scottish Crown Estate asset or its facilities that were managed by the organisation.

Because an unincorporated organisation cannot own property or take on a lease, that must instead be done in the name of individual members. Difficulties would arise if that individual were no longer a member of the organisation, because the property title would still be held by them.

In addition, unincorporated bodies are not subject to the same robust statutory, regulatory and transparency requirements as corporate bodies. Although they would still be required to meet the transparency and accountability requirements that will be placed on them by section 18 of the bill, along with the requirements relating to management plans and annual reports in sections 22 and 24, other difficulties might arise because of the lack of legal requirements being placed on their governance, and the lack of regulatory control.

Amendment 17—which will restrict to corporate bodies the type of community bodies that can be designated as community organisations under section 6(1)(b), and which could, thereby, be given responsibility for the function of managing a Scottish Crown Estate asset—will provide additional reassurance for Parliament that organisations that take on that role will be subject to a legal regime that allows them to do so effectively with less risk to their individual members. Furthermore, they will be subject to the same stringent statutory requirements on incorporation and in respect of on-going regulation relating to transparency, governance and administration as bodies under section 6(1)(a) that take on the management of assets. I encourage members to support the amendment.

I move amendment 17.

John Scott

I welcome the cabinet secretary’s amendment 17. We called for that approach at stage 1. I welcome the fact that moving to bodies corporate or full incorporation will give protection to all parties—the Scottish Government, the Crown Estate and individuals—and will provide more transparency and a very clear framework in which to operate.

Claudia Beamish

I hesitated about whether to speak to amendment 17, as John Scott has highlighted the issues that I wanted to highlight. Amendment 17 is very important, wise and protective, not least for community groups that may need guidance on issues in order not to get themselves into difficulties, if that does not sound patronising.

The Convener

Would the cabinet secretary like to wind up?

Roseanna Cunningham

I do not think that there is any more for me to say.

Amendment 17 agreed to.

Section 6, as amended, agreed to.

Section 7—Duty to maintain and enhance value

The Convener

Amendment 18, in the name of the cabinet secretary, is grouped with amendments 40 and 41. I should point out that, if amendment 18 is agreed to, I cannot call amendment 40.

Roseanna Cunningham

Amendment 18 has been developed in response to the committee’s stage 1 recommendations, and will strengthen the obligations on managers to manage assets in a particular way. It will place on managers the obligation that they

“must have regard to the desirability of managing”

Crown estate assets

“in a way that is likely to contribute to the promotion or improvement ... of”

the wider socioeconomic and environmental factors that are listed.

We do not expect, nor would it be good management, to run the Scottish Crown estate at a loss. We want managers to look beyond the balance sheet, but we do not want to tie managers’ hands where it is not appropriate to do so—in particular, since there is such a diverse portfolio and there are obligations contained in wider legislation that managers will have to comply with concerning sustainable development and the environment.

The solution that I have proposed seeks to maintain the value and income from Scottish Crown estate assets while obliging managers to take account of wider socioeconomic and environmental factors in carrying out that management. In fact, Crown Estate Scotland is currently developing tools to help it to understand, measure and monitor better the social, economic and environmental value of assets. That will be used to inform future planning and investment decisions. The intentions are that that will become core business, and that the information will be shared with other organisations with a view to driving inclusive and sustainable economic benefit. Amendment 18 will strengthen the bill, but in a proportionate way.

It is also important to highlight that section 1 of the Community Empowerment (Scotland) Act 2015 requires

“any ... person carrying out functions of a public nature”—

as a manager of a Scottish Crown estate asset will do—to

“have regard to the national outcomes in carrying out the functions”.

The new national performance framework, which the First Minister launched on 11 June, embeds the United Nations’ sustainable development goals, so managers will be required, under existing legislation,

“to focus on creating a more successful country with opportunities for all of Scotland to flourish through increased wellbeing, and sustainable and inclusive economic growth.”

Similarly, the Climate Change (Scotland) Act 2009 places an obligation on public authorities to act in the discharge of their functions in a way that contributes to the Government’s goal of reducing emissions.

I understand that amendment 40 also seeks to strengthen section 7(2) by proposing that the word “may” should be changed to “must”, and that it is linked to amendment 41, which would remove all the wider factors except sustainable development. In my evidence to the committee, I set out the clear imperative to ensure that the value of the Scottish Crown estate and the income that arises from it are maintained, otherwise the net revenue that is paid into the Scottish consolidated fund will be reduced, to the detriment of the Scottish people as a whole.

I also remain of the view that there is a clear imperative to ensure that the value of the Crown estate in Scotland is maintained. Devolution of the Crown estate to Scotland under the terms of the Scotland Act 2016 resulted in the United Kingdom Government’s block grant to Scotland being reduced by the estimated annual amount of net revenue earned by the Crown estate. All the income, minus any running costs, is now paid into the Scottish consolidated fund to benefit Scotland as a whole. There is therefore a public interest in ensuring that the value of the assets is at least maintained. Less money being paid into the Scottish consolidated fund may have a knock-on effect on the operation of other schemes that provide wider socioeconomic or environmental benefits.

We must remember that the bill is not just about management of the foreshore by community organisations, or of the rural estates. It is also about management of strategic national infrastructure—the telecommunications cables, the oil and gas pipelines, the potential for offshore renewable energy, and the rights in the sea bed beyond the 12-mile limit of territorial waters.

I recognise the concerns that have been expressed about section 7(2), which is why I have lodged amendment 18, which will deliver the recommendation of the committee’s stage 1 report, and I am concerned that amendment 40 could have unintended consequences for such a diverse portfolio.

10:30  



Section 7(1) will not empower a manager to focus on short-term gain at the expense of longer-term benefits. Such a short-term approach is, by definition, incompatible with a duty to maintain and to seek to enhance the value of the estate as a whole, and the income that arises from it. I am therefore confident that amendment 18 is the right approach and that it will deliver the committee’s helpful recommendation. However, I am happy to discuss the issue further, following stage 2.

That overarching duty would affect the key strategic decisions of managers, but members will be aware that under section 11 managers will be able, for example, to sell and lease assets for less than market value in the interests of

“economic development ... regeneration ... social wellbeing ... environmental wellbeing”

and “sustainable development”.

Amendment 41 proposes the removal of all the wider factors in section 7(2), except “sustainable development”. I wish the reference to “sustainable development” to be retained in the section, but I am concerned that removal of the reference to other socioeconomic and environmental factors would be very unfortunate. It is desirable that asset managers contribute to wider public objectives such as economic development, regeneration, social wellbeing and environmental wellbeing, and removal of those requirements from section 7(2) might act as a barrier to a manager actively considering and contributing to such factors.

Although we all want our natural resources including rural land, the sea bed and the foreshore to be managed sustainably, I do not support amendments 40 and 41. Amendment 40 competes with my amendment 18, which would not tie the hands of managers in taking strategic decisions. Amendment 41 would remove the references to wider benefits beyond “sustainable development” that were supported by stakeholders during the devolution process and in response to the consultation on the long-term framework.

However, as I have highlighted, I recognise the strength of feeling around the wording in amendments 40 and 18. Therefore, I am very happy to discuss the issue further, following stage 2. I urge members not to support amendments 40 and 41.

I move amendment 18.

The Convener

I invite Mark Ruskell to speak to amendment 40 and the other amendments in the group.

Mark Ruskell (Mid Scotland and Fife) (Green)

I acknowledge the movement that the cabinet secretary has made by lodging amendment 18, which picks up on the committee’s recommendation. However, I am disappointed because I still think that there is a fundamental misunderstanding of what sustainable development is. That is a shame, given that sustainable development goals are incorporated in the Government’s objectives and have been part of our legislation and understanding for many years.

Section 7(2) creates a list of things, including “economic development”, “regeneration”, “social wellbeing” and “environmental wellbeing”, that are already incorporated in the very nature and notion of “sustainable development”. The idea of sustainable development is that economic, social and environmental aspects are considered as a whole. That is important because it means that we can consider win-wins, and when we consider the economic health of our communities, we can consider the environmental basis on which that economic health is delivered. I am sure that we will return to that issue with amendment 42.

It is important that we do not take a pick-and-mix approach to the list in section 7(2). A decision should not be justified on economic grounds without consideration of environmental or social impacts. Likewise, it is important that a decision on environmental grounds is not considered without due process and without economic, regeneration and social considerations. In order to return best value from the assets and to enhance the value of the assets for future generations, we need to put sustainable development front and centre. Sustainable development incorporates all the other items that are listed in section 7(2), so I feel that the other items are unnecessary. That I is why I will move amendment 41.

John Scott

I will speak to the cabinet secretary’s amendment 18.

Although it might have been the committee’s view at stage 1 that the term “must” should be used rather than “may” and that there should be some movement on the matter, I and the Scottish Conservatives are of the view that the bill is absolutely fine as it is. However, I have to say that I am not quite certain what the term “desirability” in the cabinet secretary’s amendment 18 might mean in law, or what its effect in law might be, so I would welcome an explanation of that.

I do not support amendments 40 and 41 in the name of Mark Ruskell, because I believe that what is in the bill is quite sufficient. I take his point about lists, but the debate once again highlights—as he has mentioned—that there is a lack of understanding about, or a clear definition of, “sustainable development”. I suspect that he and the cabinet secretary would not be on the same page with regard to what it means in this regard; indeed, I think that if you were to ask all members in the room to write down what they believe to be “sustainable development”, you would get many different answers. We might as well keep the list, which reinforces my view that we should keep section 7 as drafted.

Finally, I believe, as the cabinet secretary does, that with the use of the term “may”, Crown estate managers will have maximum flexibility to maximise all the benefits of the Crown estate to the Scottish people and the Scottish Government.

That is my position, convener.

Stewart Stevenson

On amendment 41, which seeks to delete four items from the list in section 7(2), I simply ask us to consider examples of activities that would not be possible if we were to delete the term “social wellbeing”, because no reasonable person would imagine their being covered by sustainable development. There might, for example, be a derelict property on a piece of Crown Estate land, and it might benefit the community if it were to be demolished and the area were restored to grass. I am not sure that that would be sustainable development, but it might well promote social wellbeing in a particular community. It is certainly not development—it is the opposite. Indeed, you might almost call it “undevelopment”.

Similarly, with regard to the term “environmental wellbeing”, there might be a piece of ground that might previously have been subject to industrial contamination, and it might be appropriate for the community to respond by wishing to decontaminate that land. Visually, it might remain absolutely the same, and doing nothing with it might be the right thing to do after decontamination. That, too, would not be development. It would be a perfectly environmentally friendly and sustainable thing to do, but I cannot see how it would be encompassed by the definition of sustainable development.

On the basis of the examples that I have given, I find it difficult to support anything that would delete the terms “social wellbeing” or “environmental wellbeing”, in particular, from what the manager may or, indeed, must do.

Claudia Beamish

I support amendment 40, in the name of Mark Ruskell, which would make it obligatory for managers to promote and improve in Scotland what has been clarified in Mr Ruskell’s amendments. As colleagues might remember, I spoke on this issue at stage 1; we had a good dialogue with the cabinet secretary at that stage, and I welcome the consideration that has been given to the issue.

I realise that the cabinet secretary might have worded amendment 18 to avoid a situation in which the nature of a particular asset might make meeting one of the factors listed in the bill a practical impossibility. If that is the case, I would welcome more discussion on the matter, because I do not think that we are quite there.

I still support the use of the word “must” in section 7. Amendment 40 would strengthen the duty in relation to the various factors, but I just think that we need to look at the issue further.

Stewart Stevenson

Just for clarity, I note that amendment 18 states that the manager “must have regard”. Is that in line with what the member seeks?

Claudia Beamish

It is in line with what I seek, but the word “desirability” is weak, and I would like the measure to be firmed up. There is further discussion to be had on that. I am sorry to seem to be dancing on the head of a pin, but that is where I am.

I ask Mark Ruskell to consider not moving amendment 40. I do not know whether it is appropriate to ask the cabinet secretary to withdraw an amendment, but I ask her to do so with amendment 18, if I am allowed.

I am not minded to support amendment 41, which would leave only sustainable development as the mandatory factor to be considered, and would leave out the other four factors. However, that is not for the same reasons as my committee colleague Stewart Stevenson gave. Actually, I think that the examples that he gave are indeed issues of sustainable development, because that can involve the removal of something that is no longer sustainable.

To my mind, there is a clear understanding and definition of sustainable development—although I know that John Scott and others disagree—but I do not know that everybody follows that or agrees with it. To give one example, regeneration is an important factor that needs to stay in the list, because it is a big part of what we are doing in Scotland for rural communities, coastal communities and many other communities that will be affected by the devolution of the Crown estate. I understand that, as Mark Ruskell said, economic development, social wellbeing, environmental wellbeing and regeneration are indeed all part of sustainable development, but it is good to spell that out, so I do not support amendment 41.

Alex Rowley (Mid Scotland and Fife) (Lab)

It is important to acknowledge that the cabinet secretary has taken on board what the committee said by lodging amendment 18, although I do not think that it is strong enough. However, the cabinet secretary said that she is willing to have further discussion on the matter. That would be the best way forward, so I hope that Mark Ruskell will consider not pushing the issue at this time. Likewise, I agree with others on amendment 41—I cannot support it because the bill is stronger with those other terms.

Roseanna Cunningham

One or two members have mentioned the use of the word “desirability”, but that is a fairly common drafting construct—it is not unusual terminology that we have dreamed up out of nowhere. As with the term “reasonable person”, it is a widely understood way of constructing a form of duty that is not an absolute legal duty. It is a normal process. Basically, we are trying to ensure that, in a diverse portfolio, we do not end up imposing something that means that all the factors in the list have to be looked at even when they are not relevant to particular circumstances. We are trying to find a line in between the issues in this conversation. There is no purpose in forcing a manager to carry out a tick-box exercise when half of it simply does not apply. We must ensure that we do not impose unnecessary constraints.

Claudia Beamish

Will there be an obligation on managers to explain why they have not taken something into account? If not, it will just slide into oblivion.

10:45  



Roseanna Cunningham

That is not what the amendment says, but it might be an area for a useful conversation about how we might look at this and take it forward in a way that does not end up tying managers’ hands. We are trying to avoid tying managers down to things that are not particularly relevant. It might be an area in which we have to think about guidance, or we might have to come back and look at the issue again. We are all trying to get to the same place.

I also want to make some remarks about sustainable development. The conversation that we have already had shows that there is a slight danger in relying entirely on the phrase “sustainable development”. I reiterate what I said in my earlier comments. We already have an obligation, which derives from the Community Empowerment (Scotland) Act 2015, that requires any manager who carries out functions of a public nature—that is what the Scottish Crown Estate Bill is about—to have regard to the national outcomes in carrying out those functions. The national performance framework embeds the UN sustainable development goals. At one level, therefore, the requirement in respect of sustainable development is already imposed on managers as it is imposed on all those who are involved in carrying out functions of a public nature. That requirement is already there under existing legislation.

We consider that it is appropriate to keep the more detailed list in section 7(2), partly because of some of the interesting conundrums that were raised inevitably by my colleague Stewart Stevenson, who will always find something of that nature. He may have highlighted an issue about which there might be some debate, whereas keeping the list would remove that debate. Claudia Beamish has already said that.

The Convener

The question is, that amendment 18 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)

Against

Scott, John (Ayr) (Con)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Carson, Finlay (Galloway and West Dumfries) (Con)
Beamish, Claudia (South Scotland) (Lab)

The Convener

The result of the division is: For 4, Against 5, Abstentions 0.

Amendment 18 disagreed to.

Amendments 40 and 41 not moved.

Section 7 agreed to.

Section 8 agreed to.

After section 8

The Convener

Amendment 42, in the name of Mark Ruskell, is in a group on its own.

Mark Ruskell

Amendment 42 attempts to enshrine a golden rule that has applied to the harvesting of kelp for many years, if not generations. It is a rule that has ensured that the kelp-harvesting sector has stayed in business and that the very environmental resource that that sector relies on has been protected for future generations. The golden rule is really quite simple: it is that kelp should be harvested in a way that does not prohibit the regrowth of the individual plant. The form of words that I have incorporated into the amendment is reflected in the licences that are issued to those who hand-harvest kelp at the moment—it is a very well-established principle.

My amendment would not ban the harvesting of kelp, but it sets a clear expectation that kelp must be harvested in a way that does not prohibit the regrowth of the individual plant.

If we were to consider forests on land, these days we would not be clear-felling ancient woodland. We might consider pollarding or coppicing an individual tree, but it would not be good practice to clear-fell a forest in that way. Much the same is true of kelp forests. It is not sustainable to clear-fell them, either.

The difficulty in this area is that, once an area is clear-felled of kelp through dredging, it will take many years for the exposed rock to regrow the kelp; in some cases, due to the changing ecological conditions, it might be impossible for the kelp forests to re-establish themselves in areas that have been stripped. Therefore, in many cases, once the kelp forests are gone from a particular area, they may be gone forever or for a very long time. Once the kelp forests are gone, we lose the benefits that they deliver. I am sure that, over the past few weeks or months, members of the committee will have received correspondence about proposals to mechanically dredge and about what the benefits of kelp are to our coastal communities and our environment. However, I would like to talk about one example that, for me, has particularly underlined the importance of kelp.

My understanding is that kelp forests provide an important nursery for juvenile fish, particularly cod, saithe and pollock—the white fish that our fishing communities depend on. After kelp dredging was introduced in Norway, surveys found that there was a more than 90 per cent reduction in the number of juvenile fish in the areas that had been dredged. Through dredging for kelp, we would be removing the nurseries that support our white-fish sector. Further, the roots of the kelp—the holdfast, as they are called, which dredging pulls up—provide an important habitat for crabs and lobsters. This is one of the few environmental issues on which I have seen the white-fish sector and the creeling sector come together in opposition; I cannot think of another issue that has brought together so many diverse stakeholders in their concerns.

Kelp forests are priority marine features. They are vulnerable to climate change, so we should protect them. Of course, if we look at the policies from Natural England, we can see that it is advising against mechanical harvesting. I really do not think that we in Scotland should be engaged in a race to the bottom over environmental standards. Having said that, I also do not believe that we should be stifling innovation in situations in which a business can legitimately come forward with a sustainable way to mechanically harvest kelp. However, the golden rule that I mentioned should be applied. There should be the legal backstop that kelp should be harvested in a way that does not prohibit the regrowth of an individual plant. That is common sense, and that is why I lodged the amendment.

I move amendment 42.

The Convener

As a new convener, although I am hugely sympathetic to everything that Mark Ruskell has said, I am concerned about the fact that we have not taken evidence on this issue, which means that members—myself included—have not had the opportunity to drill down into what is involved.

I have another concern, which is based on my background in oil and gas safety. Often, innovation around any measure can also mean that things are safer for workers, as it can remove the need for any kind of manual handling to be done. I would have liked to explore that area, if we had had the opportunity to take evidence on it.

Stewart Stevenson

I am as big a fan of kelp as Mark Ruskell is, and all the environmental observations that he has made have considerable merit. I am delighted to see the creel and white-fish sectors agreeing on something, as there are areas in which there often appears to be some difference of view. The real issue is whether the amendment is the right way to address the issue of how to protect wild kelp and ensure that it can regenerate. As I understand it, the proposal is covered by section 21(1)(6) of the Marine (Scotland) Act 2010, which provides that someone needs a licence if they are going

“to use a vehicle, vessel, aircraft”

and so on to conduct harvesting of kelp. Indeed, I understand that there is a process under way on that subject.

I, too, have received a lot of correspondence, and I will share one example with the committee. The North Minch Shellfish Association makes the point that

“The ecological consequences of the industrial harvesting of kelp have not been specifically evaluated”,

and that goes to the heart of whether this is the time and place to do that. I would find it quite easy to support protecting kelp in an appropriate way, but I would not support it coming into the bill without our having considered the issue or taken evidence from the two sides of the argument. We should ensure that, when we move forward on that subject, we do so on the basis of sound science.

I have no knowledge that would enable me to reject anything that Mark Ruskell has said, and I am not going to look terribly hard for it. However, I think that the committee, in considering such things, should always ensure that it acts on the basis of information and understanding of the wider issues. Bluntly, if we were to act in the absence of that, what could happen—it is always unhelpful when such a thing happens—is that we will end up in court with a judicial review, possibly from the company concerned, although I suspect that the economic value might not justify that quite expensive process.

There is considerable risk in addressing the issue in the bill in the way that Mark Ruskell proposes. I invite him to withdraw amendment 42 and to work with the Government to see whether the provisions of the Marine (Scotland) Act 2010 would lead to the right outcome or whether there is another way of doing it that would give this committee or another committee an appropriate opportunity to take all the evidence before reaching a final conclusion about how we can protect wild kelp. It is not that I do not want to protect it, but a question of how—and where and when—we do that.

Richard Lyle

I, too, want to preserve and protect kelp and ensure that it is there for future generations. We have all received numerous emails and tweets over the past few days and weeks about the harvesting of sea kelp. I am reminded, as other members are, that the committee has not taken any evidence on the issue from those who would be affected or from any other interested parties, especially since the activity, as I understand it, cannot go ahead without a marine licence being obtained, which includes a robust environmental impact assessment. Am I not correct in saying that there is even a marine application licence for that? However, I understand the concerns and I will certainly take note of what is said by members to inform how I will vote on the issue.

Claudia Beamish

I support amendment 42. It is absolutely right that those responsible for the newly devolved management of Crown Estate assets should be tasked with considering sustainability when deciding whether to license harvesting.

Mark Ruskell’s amendment will ensure that licences are not granted for harvesting wild kelp

“from any area of the seabed under their management where such harvesting would inhibit the regrowth of the individual plant.”

As we have heard from him, kelp forests are a priority marine feature. Clearly, there are serious issues about its protection that need to be considered.

11:00  



Sustainable kelp harvesting has a long tradition in Scottish inland waters. It is done with care and sensitivity to our marine environment and in relation to the other jobs that depend on the kelp forests. Future kelp harvesting must continue to be sustainable. It must not threaten sea life, sea-bed habitats, the protected seabirds that feed on the sand eels in those habitats or the nurseries of young pollock, cod and other white fish.

Over the past six years, in which I have been a member of this committee and its predecessor, I have taken a keen interest in marine environmental issues. A significant issue to consider is that kelp forests, along with seagrass beds and other areas of our inshore waters, are invaluable carbon sinks that merit great respect. The climate change plan recognises the developing research into those complex issues, which we ignore at our collective peril. Although I have not been able to investigate it in detail, I understand that there is Norwegian research that evaluates failure to regrow kelp after harvesting.

We should take the precautionary principle in relation to kelp harvesting. It is important to ensure that sustainable jobs are supported in our coastal communities now and in the future. There must be careful analysis of whether Marine Biopolymers’ proposal would lead to sustainable harvesting—

Richard Lyle

May I intervene?

Claudia Beamish

Can I finish my point, please?

I do not see it as my role in committee today to comment on an individual application—that would be inappropriate—so I am deliberately avoiding pointing out research or expert views that relate to that specific potential development.

Richard Lyle

I do not think that anyone disagrees with you, but my earlier point was that we have not taken evidence on the issue. I welcome what you have brought to the fore, but I wish that we had discussed the matter well before now.

Claudia Beamish

I understand that, but between stages 1 and 2 there have been approaches by a number of groups and individuals—possibly partly on the back of the application, which I do not want to refer to any more. However, there is plenty of evidence in relation to climate change, carbon sinks and marine protected features that point us in the direction of supporting Mark Ruskell’s amendment 42.

It is important to highlight that many sustainable jobs depend on the “protection and enhancement” of the marine environment, which is a clearly stated aim in the Marine (Scotland) Act 2010. That includes creel fishers. We have heard from Alistair Sinclair—I acknowledge that that was only yesterday—that he has the support of the 400 creel fishers whom he represents. In addition, the white fish sector has given us information about its concerns and we have heard from marine tourism operators, hand-divers for scallop, hand-divers for kelp and sea kayak companies.

I have had emails from some of those people asking me to support the amendment today. I ask that all other members seriously consider supporting the amendment in order to put down a robust marker to protect our kelp forests.

The Convener

Before I bring in other members, I ask everyone to speak through the chair if they want to make a further comment on the back of their original comments. I am not entirely keen on the intervention strategy that is being used. This is a committee—I would rather that people speak through the chair, and I will take you if I have time.

Finlay Carson (Galloway and West Dumfries) (Con)

I welcome Mark Ruskell’s opening statement—he has brought into the public domain an issue that certainly needs to be discussed—and I agree with much of it.

Mark Ruskell said that there is a well-established principle for the harvesting of wild kelp. However, it would be inappropriate to legislate on this matter under the Crown Estate (Scotland) Bill. The issue would be more appropriately dealt with through the licensing system. If we get the opportunity to examine the matter, it should be viewed from a scientific perspective; we should also look at what the environmental and economic impact of kelp harvesting would be. I would welcome further work on that.

As I have said, I welcome Mark Ruskell’s amendment, but I am not sure that it is appropriate to deal with the issue under the legislation that we are considering.

Angus MacDonald (Falkirk East) (SNP)

As we have heard, there is no doubt that this is an important subject, given the social media traffic and emails that I have received, and the submissions that have been made to the committee in recent days. I agree with the convener and others that the committee must take more evidence on the issue before reaching a conclusion.

It is worth stressing that the bill is an enabling bill and that we are discussing an issue that is not, as yet, the subject of a marine licence application, although I believe that a scoping report has been submitted to Marine Scotland. I do not want to dwell on that. I have some sympathy for the concerns that have been raised, but I am slightly concerned that we are straying into operational matters in our consideration of what is an enabling bill.

I have a question for Mark Ruskell. If amendment 42 is agreed to, is it not likely that amendments will be lodged at stage 3 that seek to ban managers from doing other things? I suggest that amendment 42 is out of kilter with the general duties under the bill. That is my main concern and, ideally, I would like Mark Ruskell to withdraw his amendment for the time being.

John Scott

Most of what I was going to say has already been said, but I will reiterate it nonetheless.

Unlike Claudia Beamish, I am not convinced that the bill is the correct place to introduce such a measure. I do not believe it to be appropriate. Of course, I note the significant concerns of the different industry bodies that have contacted us. Both sides have points of view.

In common with other members, I hugely regret the fact that we have not taken evidence on the subject. Stewart Stevenson made a valid point when he said that it might not be too late to take evidence. There is a precedent for taking evidence at stage 2. It is unusual, but Stewart Stevenson is a man who knows the rules, and he probably knows what I am talking about.

There is a process to be followed here, and I am not sure that the proper process that is expected of this Parliament is being followed. I find it surprising that Claudia Beamish said that she was avoiding expert views.

Claudia Beamish

I would like to clarify what I said. I made that remark specifically in relation to the dredging application, which I was sent information about. I did not want to refer to the Norwegian example for that reason.

John Scott

Notwithstanding that, you have been keen to extol the case, very strongly, of the people whom you are representing—

Claudia Beamish

In broad terms, yes.

John Scott

—without giving any credence to any other arguments that have been presented.

I believe that there is a process to be followed. It is possible to act in haste and repent at leisure, so I urge Mark Ruskell to withdraw his probing amendment. The cabinet secretary might wish to discuss his amendment with him to see what—if anything—can be achieved at stage 3, but I think that there is a better way of going about things than the one that is suggested in amendment 42.

Alex Rowley

I support amendment 42 for the reasons that have been set out by Mark Ruskell and Claudia Beamish.

I want to pick up on a couple of points. Angus MacDonald talked about managers being asked to ban the harvesting of wild kelp, but that is not what amendment 42 is about. If that was what it was about, the points that have been made about the need to have the scientific evidence would be far more relevant. Amendment 42 is saying that managers must not grant a right to carry out the harvesting of wild kelp where such harvesting would inhibit the regrowth of individual plants. That is what the amendment is about. It is perfectly appropriate that that guidance and that clear direction to managers are given in the bill so that we protect and ensure that that established principle is put into play where the harvesting of wild kelp takes place.

In a sense, it is a mistake to talk about the science. The amendment does not speak about bans.

Roseanna Cunningham

I have a considerable legal difficulty at the moment, given that a marine licensing process is currently being undertaken, albeit that it is at the pre-application stage, and I am the responsible minister for whom that would end up being a decision-making process. Therefore, I cannot make a great deal of comment about the amendment, and I certainly cannot indicate any value judgment on the issue one way or the other, as that would be instantly prejudicial to an on-going process. I want people to be very clear about that. The pre-application process is part of the process.

I will have to pick my way through a minefield to try to make a couple of points about the situation that we are in.

The bill is about the general managing requirements for the assets, not specific activities. It is also about the devolution of management of Crown Estate assets to those with an interest in them—we have had discussions about community organisations and local authorities, for example—with a view to increasing local control over decision making. The bill already contains powers for the transfer or delegation of the management of a Crown Estate asset, which include the ability to restrict the activities that a manager can undertake as a manager. That reflects the ethos of the bill to allow decisions to be taken on a case-by-case basis.

Amendment 42 is not about trying to give effect to those principles at all. In effect, it tries to bring about a ban on the conduct of one particular marine activity: the seaweed harvesting that is being discussed. I simply make the point that other members have made: thus far, there has been no evidence gathering that would adequately inform committee members one way or the other, and the proposal is being made in the absence of any proper process.

There is an existing robust marine licensing regime that regulates activities. The pre-application process is part of that regime. As I indicated at the outset, that process is already under way.

Amendment 42 therefore cuts across what the Scottish Parliament has already legislated for in the past decade, which is a statutory regime that requires licences to be granted before such activity can be carried out. That regime includes a full assessment of the environmental impacts. To take a decision before those impacts have even been assessed does not seem appropriate and is certainly not evidence based. That is not to say that we do not recognise that there are concerns about potential environmental impacts. However, as I said at the outset, I am in an extraordinary position in that I cannot indicate a view one way or the other for fear of creating a difficulty with the process that is already under way.

If Mark Ruskell insists on pressing amendment 42, I can only ask members to abstain in the vote. I am, of course, happy to continue to discuss the matter at stage 3.

11:15  



Mark Ruskell

I will deal first with the issue of whether this is an appropriate bill for such an amendment. I believe that it is, because kelp is a property right of the Crown. Everything that is attached to the land forms part of the land. The bill is an appropriate place in which to consider how kelp can be harvested sustainably.

On the process of taking evidence during the bill’s passage through Parliament, I agree that it would have been better to have had evidence on this issue at stage 1. However, sometimes events in the real world overtake the work of this Parliament. We have to be fleet of foot and respond to evidence and concerns that the public brings to us. If the amendment is passed at stage 2 today, that would still give time to consider evidence and representations from stakeholders and for other discussions with the Government, ahead of the final opportunity to amend the bill one way or another at stage 3.

Amendment 42 would not enshrine a new principle in legislation. It is a well-established principle. I emphasise, as Alex Rowley and Claudia Beamish have, that the amendment does not provide for a ban on a proposal from a particular company—that proposal is irrelevant. It would enshrine in legislation the already well-established principle for the licensing of hand harvesting of kelp that has been in place in Scotland for many years. It would create a level playing field with whatever other interests may wish to put forward licence applications to harvest kelp in the same way or in a different way. It would not establish a new precedent. It would merely take an existing licensing precedent and ensure that it has a more robust legal basis. It would not determine what is a good or bad way to harvest kelp. It would set out a key golden rule, which is that kelp must be harvested in such a way that does not prohibit the regrowth of an individual plant. That is why I will press the amendment.

The Convener

The question is, that amendment 42 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Ruskell, Mark (Mid Scotland and Fife) (Green)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Beamish, Claudia (South Scotland) (Lab)

Abstentions

Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Scott, John (Ayr) (Con)
Martin, Gillian (Aberdeenshire East) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Carson, Finlay (Galloway and West Dumfries) (Con)

The Convener

The result of the division is: For 3, Against 0, Abstentions 6.

Amendment 42 agreed to.

Sections 9 and 10 agreed to.

Section 11—Duty to obtain market value

Amendments 19 and 20 moved—[Roseanna Cunningham]—and agreed to.

Section 11, as amended, agreed to.

Section 12—Meaning of “market value”

Amendment 21 moved—[Roseanna Cunningham]—and agreed to.

Section 12, as amended, agreed to.

Section 13 agreed to.

After section 13

The Convener

Amendment 43, in the name of Liam McArthur, is grouped with amendment 44.

Liam McArthur (Orkney Islands) (LD)

I apologise to the convener, colleagues and the cabinet secretary for my late arrival this morning. There is a Justice Committee meeting going on, to which I will have to return.

Unlike colleagues, I have not had the benefit of sitting through the evidence at stage 1. Nevertheless, devolving the management of the Crown estate in Scotland to the communities with the most interest in and reliance on the future use of those assets has been an issue that I have pursued since before I was elected in 2007. I therefore welcome the bill and what it can help to achieve, although, like most of us, I accept that it can and should be strengthened, not least to unlock and secure the benefits for communities arising from developments in the marine environment out to 12 nautical miles, at this stage.

To be clear, that includes but should not be limited to the revenue accrued through rental agreements. I also think it important that decisions over how those benefits are set, raised and allocated are taken at a local level. Indeed, that is the underlying principle of my amendments.

I appreciate that some might be concerned about adding to the cost of projects, particularly in the early phase when they might be more vulnerable, but I am confident that the flexibility in my proposals and the mutual interest of local authorities and developers in avoiding projects being in effect throttled at birth will ensure that a proportionate—and potentially phased—approach is taken. Of course, in each instance, there would be a requirement for detailed prior consultation.

As colleagues will be aware, the Orkney and Zetland County Council acts already provide evidence—and perhaps a blueprint—of how this might work. Over the past 40 years, the local management and commercial extraction of marine resources have been achieved through formal agreements, such as works licensing under the Orkney and Zetland acts, and agreements with the oil industry. Those arrangements have worked well, both in the interests of the local communities and, I think, at a national level. That track record of our island authorities has been recognised and underpins how inshore regional marine planning is being taken forward and should be extended.

The principle that local authorities should be compensated for disruption and inconvenience associated with development work seems to be widely accepted. We have seen that in territorial planning, albeit on a voluntary basis, and we are starting to see it emerging in offshore developments, although, again, on a voluntary and, I think, patchy basis. However, the fundamental point is that communities that have to endure the burden of development, dislocation, risk and exploitation of scarce resources must be involved in decision making about the developments that do and do not happen. Community benefit is a necessary adjunct of that decision-making process.

None of this should be unduly controversial. Indeed, much of what I have said sits comfortably with the Government’s commitments in its prospectus “Empowering Scotland’s Island Communities”. I realise that the amendments might need some fine tuning ahead of stage 3, and I am happy to work with the cabinet secretary and her officials to achieve something workable. However, I hope that the committee will see fit to agree to the principles underlying my amendments and that we can take them forward.

On that basis, I move amendment 43.

Stewart Stevenson

I will raise a small issue with regard to adjacent local authorities that might be said to share an area. For example, in the area between Bute and Arran, the 12-mile limits for the authorities concerned overlap, and I am interested in hearing how that would be dealt with. The definition used in subsection 2(b) of amendment 43 says that the area in question would run

“from Mean High Water Springs out to 12 nautical miles”.

In the case of Bute and Arran, there will be an overlap between the two adjacent authorities.

Claudia Beamish

If Liam McArthur decides to press amendment 43 instead of agreeing to discussions prior to stage 3, I will be keen to support it. This is a very complex issue, and having read what the island authorities have had to say about it, I find their argument that this is where the benefit should go for distribution to be cogent. After all, they know their communities well. As long as the criteria are set appropriately—and, to be blunt, they have not been with regard to certain issues such as onshore wind, which is something that I have experience of—the approach is a very good one to support.

I also think that addressing the possibility of delays to revenue coming in might be appropriate with regard to start-ups. I do not think that anyone will want to jeopardise jobs or the possibilities of renewable energy, but it might affect, say, other aspects of the industry that are just developing, such as carbon capture and storage, should we go down that road.

In short, I say yes to the amendments in principle, but there might well be further discussion to be had.

Mark Ruskell

I have a question on how amendment 43 might impact on the planning system and marine licensing. My understanding is that, at the moment, community benefit is not a material consideration. It is considered to be a voluntary contribution, although it is desirable, and that is reflected in Government policy. However, it does not form a material consideration in planning and I am unclear about how it sits within marine licensing. If amendment 43 is agreed to today, will it change that in any way and elevate the status of community benefit in relation to the determination processes that exist elsewhere in legislation?

Roseanna Cunningham

The Government is resisting amendment 43 and consequential amendment 44. They are unnecessary because the Scottish ministers have made a commitment to ensure that coastal communities will benefit from the net revenue from the Scottish Crown estate marine assets. Wider arrangements that are promoted by the Scottish Government are already in place.

In addition, for some time, the Scottish Government has encouraged all renewables developers to provide community benefit, which is what Mark Ruskell has just been talking about, as part of any new projects. The Government also promotes good practice principles in relation to that. We also encourage aquaculture developers to evidence community benefit as part of any proposed new development.

The Scottish Government has no powers to oblige developers to pay community benefits for such schemes. It is not necessary in practice, as there are examples of local community benefit schemes being put in place on a voluntary basis by developers in Scotland.

On ensuring local community benefit, we have had constructive discussions with the Convention of Scottish Local Authorities and have agreed an interim mechanism for local authorities to receive a share of the net revenue out to 12 nautical miles. Having said that, members might have noticed that I was having a vigorous conversation with the official to my left because—and this sometimes happens with amendments at any stage—our reading of amendment 43 is that it would impose a duty on the Scottish ministers to make regulations about a community benefits requests scheme in relation to Scottish Crown estate assets within the Scottish marine region for the Orkney Islands, as defined in article 8 of the Scottish Marine Regions Order 2015.

Liam McArthur might not have intended to lodge an amendment that relates solely to the Orkney Islands, but he might have. I can see that there might be an advantage in a local press release along those lines. Our understanding of amendment 43 as it is drafted is that it would apply only to the Orkney Islands Council. I am not certain that that is what is intended; perhaps we need to discuss that.

I am happy to have a conversation with Liam McArthur about that, because arrangements are being made to distribute the revenue to coastal councils later this year for the purpose of benefiting local communities. We have agreed with COSLA that we will review the interim arrangements, including whether we can establish a closer link with the net revenue raised in a local authority area and how benefit to local communities can be assured. Active conversations are already being held in and around the issue.

I ask Liam McArthur not to press amendment 43 and not to move amendment 44. I will be happy to engage with him in a discussion about how we could give effect to what I suspect is a general feeling around the issue, rather better than what is drafted here.

Liam McArthur

I will start by coming clean in relation to the Orkney-specific focus of amendment 43. I am fairly sure that that was unintentional; it might just have been muscle memory and force of habit. It illustrates, as do some of the other points that have been made and as I conceded in my opening remarks, that the amendments were lodged with the view that they would almost certainly need some further work.

I thank Stewart Stevenson, Claudia Beamish and Mark Ruskell for the points that they raised during the debate. Stewart Stevenson made a point about adjacent local authorities. That issue does arise and there are already examples in marine planning that would point in that direction and might address some of those points, whether it be competing interests or mutual interests, and how those might be properly balanced.

I welcome Claudia Beamish’s support for the principle underlying amendment 43. The cabinet secretary has illustrated the complexity of the issue but, as Claudia Beamish said, the arguments that local authorities have put forward have been cogent and coherent in articulating the underlying principle.

11:30  



On Mark Ruskell’s points about the impact on marine licensing and community benefit not being a material consideration in planning, as I think I said in my opening remarks, although community benefit has been a feature of planning applications in land-based developments, that has been on a voluntary basis and it has been patchy. I can point to examples from my Orkney constituency and from the early stages where the process was unsatisfactory. Although the process may have improved and communities are better sighted on what has been negotiated in similar circumstances, it remains the case that that is done on a voluntary basis. There is a concern that, for some of the developments that we are talking about, a firmer right is required.

The cabinet secretary noted that conversations are on-going with COSLA. I thank her for her invitation to continue the discussions on what might be achieved at stage 3. On that basis, I seek to withdraw amendment 43.

Amendment 43, by agreement, withdrawn.

Section 14 agreed to.

After section 14

The Convener

Amendment 22, in the name of the cabinet secretary, is grouped with amendment 27.

Roseanna Cunningham

Amendment 22 inserts a new section after section 14 that makes provision about rights and liabilities. The amendment makes it clear that the costs and liabilities that are associated with managing a Scottish Crown estate asset must be met from Scottish Crown estate funds and cannot be met from any other funds that the manager has in respect of any other purpose. The amendment also gives the Scottish ministers a power to make regulations transferring rights and liabilities between managers that can be exercised even when the management function is not also being transferred or delegated. The power is additional to the power in section 3(1)(b) to transfer rights and liabilities, which may be used only when a transfer of management of an asset is being made. The power relates to rights and liabilities relating to Scottish Crown estate assets, former assets and historic Scottish assets, which are assets that once formed part of the Crown estate in Scotland.

Amendment 27 provides that regulations that are made under the new section will be subject to the affirmative procedure if they textually amend an act and that otherwise they will be subject to the negative procedure.

I move amendment 22.

Amendment 22 agreed to.

Sections 15 to 19 agreed to.

Section 20—Strategic management plan

The Convener

Amendment 37, in the name of Andy Wightman, is grouped with amendments 38 and 39.

Andy Wightman

Section 20 places a duty on the Scottish ministers to prepare a strategic management plan for the Scottish Crown estate. By way of introduction, I want to spell out briefly why I lodged amendments 37 to 39. Recommendation 32 of the Smith commission report states:

“Responsibility for the management of the Crown Estate’s economic assets in Scotland, and the revenue generated from these assets, will be transferred to the Scottish Parliament.”

The management was devolved under the Scotland Act 2016, but the revenues were not—they remain reserved, notwithstanding that the Civil List Act 1952 provides that the Scottish Crown estate revenues should be paid into the Scottish consolidated fund. The reason for that on-going reservation is yet to be established, but one explanation is that the Treasury is protecting the interests of the monarch and their successors, who have a constitutional obligation to surrender the revenues of the Crown at the beginning of every reign. It is worth noting that, if that does not happen, the bill will be rendered meaningless. That failure to devolve the revenues is why Scottish ministers are having to have discussions with the Convention of Scottish Local Authorities to work out a way of implementing their commitment to transfer 100 per cent of the net revenues out to 12 nautical miles to local authorities.

The 2016 act constrains the freedoms of this Parliament to legislate over management and provides no scope whatsoever to legislate in respect of revenues. That is why I lodged four amendments that would have exercised the devolved competence to legislate on Crown property rights that was provided in section 3(1) of part 1 of schedule 5 of the Scotland Act 1998. Those amendments were to extinguish the Crown’s rights in native oysters and mussels, in the foreshore, in the sea bed and, through the repeal of the Royal Mines Act 1424, in naturally occurring gold and silver. Those rights are, in my view, a feudal relic and an anachronism in relation to any modern form of land tenure and should have no place in that system. However, to my disappointment, the convener ruled that those amendments were outwith the scope of the bill. Removing those rights from Scotland’s system of land tenure would have taken them outwith the Crown estate, outwith the constraints that are imposed by the 2016 act and this bill and, indeed, outwith any attempt by a future monarch to refuse to surrender Crown revenues. I will continue to make the case at stage 3 for doing that, and I am happy to enter discussions with the cabinet secretary if she is minded to contemplate such a move.

As an alternative to the amendments that were ruled out of scope, I lodged an amendment that would place a duty on ministers to set out their view on the desirability of doing precisely those things that I would prefer to be done today, through this bill. Amendments 38 and 39 are designed to prevent the duty from being delegated to Crown Estate Scotland.

To be clear, amendment 37, which is the substantive one in the group, would require that, in any strategic plan for the Crown estate, ministers must express their views on the desirability of extinguishing the Crown’s property rights and interests in naturally occurring oysters and mussels, in the foreshore, in the sea bed and in gold and silver, the latter of which are vested in the Crown under the Royal Mines Act 1424; incidentally, I think that that is the oldest statute on the Scottish statute book.

I move amendment 37.

Stewart Stevenson

I congratulate Andy Wightman on moving the bar backwards. I think that, previously, the oldest act that we had referred to in debate was the Common Good Act 1491, which he knows about.

Mr Wightman said that the effect of his proposal would be to abolish the Royal Mines Act 1424. That act is quite a short one—it is but two lines long. Essentially, it nationalises the extraction of silver and gold where there are three half pennies of silver in one pound of lead, so that they become the property of the Crown. Therefore, abolishing the act would undo the nationalisation and transfer of other people’s assets to the Crown.

I understand that there is only one gold mine in Scotland and that, at the time of the 1424 act, the location of that gold mine was on land that was owned by the Campbells. Therefore, the abolition of the 1424 act would transfer back to the Campbells their rights to gold and silver.

Andy Wightman

Will the member take an intervention?

The Convener

You will have an opportunity to answer some of these points later.

Andy Wightman

I appreciate that, but I would like to clarify at this stage the contention—

The Convener

I understand, but I would like to hear from Mr Stevenson. You can respond when you sum up.

Stewart Stevenson

If transferring the Campbells’ rights to gold and silver back to them is Mr Wightman’s intention, that is fair enough—he is entitled to have that intention—but it is not an intention that I would support.

If, as Mr Wightman suggested, his proposed amendments would abolish the 1424 act—I am not sure that they would, based on my reading of what is before us—we need to know what would happen then, and I am not sure that the amendments before us deal with that.

Claudia Beamish

It is clear that anything that will abolish feudalism in this day and age is an imperative. The issues are complex and, to be open about it, I have not made the time to delve into the detail of the situation—I am not giving the excuse that I have not had the time; it is just that I have not made the time. However, in these circumstances, I ask Andy Wightman to consider withdrawing his amendment to enable further detailed discussions to be held with the cabinet secretary and others so that we can ensure that we are heading in the right direction of travel. I hope that something can be brought back at stage 3.

Roseanna Cunningham

Amendment 37 would require the Scottish ministers to set out their views on the desirability of extinguishing the Crown’s property, rights and interests in the various assets that are listed: oysters and mussels, the foreshore, the sea bed and gold and silver. I should highlight that the right to gather naturally occurring oysters and mussels has not formed part of the rights of the Crown Estate in Scotland since November 2014, as those rights were transferred to the Scottish ministers. As such, that right is not a right of the Scottish Crown Estate following the transfer that took place from the Crown Estate Commissioners last year.

The bill is concerned with the management of Scottish Crown estate assets and devolving management of those assets to bodies with an interest in them, such as local authorities and community organisations. Although the bill enables transfer of ownership of assets in the course of management, it is not about the question in principle of the Crown’s ownership of those assets and whether those assets should form part of the Crown estate at all. Therefore, the proposed amendment is not relevant to the purpose of the bill. It would not be appropriate to require the Scottish ministers to comment in the strategic plan—which is concerned with the management of the Crown estate—on whether the Crown’s rights should be extinguished.

Although amendment 37 does not directly seek to legislate to extinguish the Crown Estate’s property, rights and interests in the listed assets, its effect would be to require the Scottish ministers to consider the desirability of doing so in the strategic management plan, which the bill requires to be prepared every five years. Any such consideration would have to take account of the fact that it is not within the Scottish Parliament’s powers to take forward such legislation.

Any attempt by the Scottish Parliament to extinguish the Crown’s property, rights and interests in Crown estate assets is likely to be outside legislative competence. Account would have to be taken of the fact that extinguishing the Crown’s right in an asset would have a knock-on effect on hereditary revenues that are generated by that asset, which are reserved even though the revenues are now paid into the Scottish consolidated fund. The hereditary revenues are the moneys that are currently generated from an asset and those that will be raised in the future. That has particular relevance to the potential for offshore energy in the Scottish zone, which is that part of the sea bed outwith the 12-mile limit of territorial waters.

More fundamentally, only the sea bed out to the 12-mile limit forms part of Scotland’s territorial waters. The rights to the sea bed between 12 and 200 nautical miles from Scotland are governed by international law under part 5 of the United Nations Convention on the Law of the Sea. The convention confers on the coastal state certain special rights to that area of the sea bed, including rights to exploration and the use of marine resources, for example, for energy production from water and wind. The coastal state is the United Kingdom. Devolution of the management of those rights was recently granted to Scotland and Crown Estate Scotland (Interim Management) on the basis that they would form part of the rights of the Scottish Crown Estate. If the Crown’s rights in the sea bed were extinguished, it is likely that the management of the sea-bed rights beyond the 12-mile limit—that is, the rights over the zone in which we see great potential for development of renewable energy—would revert to the UK Government.

As for the rights to gold and silver, if the Crown’s rights were extinguished, those rights would fall to whoever was the owner of the lands when the Royal Mines Act 1424 became law. If the owner’s descendants could not be traced, the rights would fall to the Crown anyway as bona vacantia. Therefore, in our view, the exercise would be futile.

In those circumstances, I ask Andy Wightman not to press amendment 37 and not to move the consequential amendments 38 and 39.

The Convener

I invite Andy Wightman to wind up.

Andy Wightman

I thank members for their comments.

To be clear, amendment 37 would require ministers to set out their views. When it comes to matters such as the Royal Mines Act 1424, I had an amendment that was deemed not to be within scope, so it was not lodged. For members’ information, it contained a provision whereby, on such day as the act was repealed, gold and silver would vest in the Scottish ministers, so it would not be my intention for the Campbells or anyone else to get back their gold and silver.

I am well aware that management of naturally occurring oysters and mussels, which the cabinet secretary mentioned, was transferred a couple of years back and that they no longer form part of the Crown estate. Nevertheless, the Crown still has rights in them, notwithstanding the fact that they are not managed as part of the Crown estate; they are managed by Scottish ministers. That is no different from other Crown property rights, such as bona vacantia, which the cabinet secretary mentioned, that have always been managed in Scotland by the Crown Office.

11:45  



I mentioned the section of schedule 5 to the Scotland Act 1998 that devolves competence over property rights of the Crown. An issue could arise about the fact that revenues remain reserved, but in the Civil List Act 1952, assets of the Crown that have never been part of the Crown estate—bona vacantia, ultimus haeres and treasure trove—were admitted to not form part of the civil list settlement at that time because they were never part of the Crown estate. Indeed, the 1952 act has now been amended to take account of the devolution of the Crown estate. I do not therefore think that there would be any substantive problem with abolishing those rights. It is, of course, worth noting that we abolished the Crown’s rights and paramount superiority under the Advocate General and nobody took any issue with that.

In light of members’ comments and the cabinet secretary’s comments on what she regards as Scottish ministers’ duties under section 20 in terms of the scope of the bill, I will not press amendment 37.

Amendment 37, by agreement, withdrawn.

Section 20 agreed to

Sections 21 to 23 agreed to.

Section 24—Annual report

Amendment 23 moved—[Roseanna Cunningham]—and agreed to.

Section 24, as amended, agreed to.

Section 25—Laying and publication of annual reports

Amendment 24 moved—[Roseanna Cunningham]—and agreed to.

Section 25, as amended, agreed to.

Sections 26 to 36 agreed to.

Section 37—Power to delegate functions to Crown Estate Scotland

Amendments 38 and 39 not moved.

Section 37 agreed to.

Sections 38 and 39 agreed to.

Section 40—Regulations

Amendment 25 moved—[Roseanna Cunningham]—and agreed to.

Amendment 44 not moved.

Amendments 27 and 26 moved—[Roseanna Cunningham]—and agreed to.

Section 40, as amended, agreed to.

Sections 41 and 42 agreed to.

Schedule 2—Consequential and minor modifications

Amendment 28 moved—[Roseanna Cunningham]—and agreed to.

Schedule 2, as amended, agreed to.

Section 43—Interpretation

Amendment 29 moved—[Roseanna Cunningham]—and agreed to.

Section 43, as amended, agreed to.

Sections 44 and 45 agreed.

Long title agreed to.

The Convener

That ends stage 2 consideration of the bill.

At its next meeting on 25 September, the committee will take evidence in round-table format on the register of controlled interests in land.

Meeting closed at 11:50.  



Scottish Crown Estate Bill with Stage 2 amendments

Additional related information from the Scottish Government on the Bill

More information on how much the Bill is likely to cost (Supplementary Financial Memorandum)

More information on the powers the Scottish Parliament is giving Scottish Ministers to make secondary legislation related to this Bill (Supplementary Delegated Powers Memorandum)

Stage 3 - Final amendments and vote

MSPs can propose further amendments to the Bill and then vote on each of these. Finally, they vote on whether the Bill should become law

Debate on the proposed amendments

MSPs get the chance to present their proposed amendments to the Chamber. They vote on whether each amendment should be added to the Bill.

Documents with the amendments considered at this meeting on 21 November 2018:

Video Thumbnail Preview PNG

Debate on proposed amendments transcript

The Presiding Officer (Ken Macintosh)

The next item of business is stage 3 proceedings on the Scottish Crown Estate Bill. In dealing with the amendments, members should have the bill as amended at stage 2—that is, SP Bill 24A—the marshalled list and the groupings.

I remind members that the division bell will sound and proceedings will be suspended for five minutes for the first division of the afternoon. The period of voting for the first division will be 30 seconds. Thereafter, I will allow a voting period of one minute for the first division after a debate.

Members who wish to speak in the debate on any group of amendments should press their request-to-speak button as soon as possible after I call the group.

I now ask members to refer to the marshalled list. Amendment 1, in the name of John Scott, is grouped with amendments 2 and 4.

Section 3—Transfer of management function

14:45  



John Scott (Ayr) (Con)

I will speak to amendments 1, 2 and 4, which are in my name. Amendment 2 would require the creation of a list of assets to be managed by Scottish ministers or Crown Estate Scotland and would create a duty to consult individuals or bodies mentioned in subsection (2)(a) or (b) before making regulations regarding the transfer of assets.

The amendment has been brought forward in response to evidence presented to the committee at stage 1, when the committee came to the view, at recommendation 16, that some assets should remain under national management. That was also the view of the Crown estate tenant working group, NFU Scotland and the Scottish Tenant Farmers Association, and it was the view expressed in evidence taken about the risk of fragmentation and the loss of a critical mass of knowledge within Crown Estate Scotland. The amendment seeks to respond to those concerns and maintain a critical mass of expertise within Crown Estate Scotland.

Amendment 4 would make section 3(1A) subject to the affirmative procedure, thereby ensuring a wide consultation process before making any transfer of assets.

Amendment 1 is a technical amendment supporting amendment 2.

I move amendment 1.

The Cabinet Secretary for Environment, Climate Change and Land Reform (Roseanna Cunningham)

I thank John Scott for lodging the amendments in the group and raising the issue for debate.

The committee expressed support for some activities to be managed at the national level and the amendments that Mr Scott has lodged would require regulations to be made that list the assets to be managed at the national level either by the Scottish ministers or by Crown Estate Scotland.

The bill will allow the management of assets to be devolved to public authorities and community groups that wish to take on that responsibility and who can demonstrate that they have the requisite ability and experience to do so effectively. That will allow decisions as to who will manage a particular Scottish crown estate asset to be taken on a case-by-case basis. That is an approach that was supported by respondents to the Scottish Government’s consultation on the long-term management of the Crown estate in Scotland; that consultation took place in 2017.

Mr Scott’s amendments would undermine the case-by-case approach that the Scottish Government advocated for the transfer or delegation of management of Scottish Crown estate assets.

As I outlined during stage 1, there may be circumstances in which assets need to be managed on a national basis and any proposed transfer of management will be subject to the Parliament’s approval. The Scottish Government’s response on that matter to the Environment, Climate Change and Land Reform Committee stage 1 report stated that we regard the question of which assets should be managed on a national basis and which can be devolved to a local level to be a strategic matter that could evolve over time. It will also be dependent on the level of interest expressed by persons who wish to manage an asset.

I am aware of tenants’ strong preference for the rural estates to continue to be managed at the national level, and I am also aware of views that some other assets need to be managed at the national level. I consider there to be valid arguments for some assets to be so managed—I am thinking, in particular, about the management of rights in the 12 to 200 nautical mile zone and about leasing for strategic national infrastructure, such as telecoms, cables, oil and gas pipelines and offshore wind leasing.

I firmly believe that the case-by-case approach to reforming such management, as provided for in the bill, can achieve the aim of ensuring that each asset is managed appropriately and at the appropriate level.

I ask Mr Scott not to press the amendments in the group.

John Scott

I hear exactly what the cabinet secretary is saying and I appreciate her tone and tenor. However, my view remains that it would provide clarity for those who are considering whether to take on the management of assets or not if the assets that the Government would consider allowing others to take on, or not, were to be clearly defined; indeed, the publication of a list would not preclude a case-by-case approach, the value of which I understand and support.

I press amendment 1.

The Presiding Officer

I think that I know the answer to this, but the question is, that amendment 1 be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a division. As this is the first division of the day, Parliament will be suspended for five minutes while we ring the bell to call members to the chamber.

14:50  



Meeting suspended.

 

14:55 On resuming—  



The Presiding Officer (Ken Macintosh)

We move to the division on amendment 1.

For

Whittle, Brian (South Scotland) (Con)
Wells, Annie (Glasgow) (Con)
Tomkins, Adam (Glasgow) (Con)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Scott, John (Ayr) (Con)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Mason, Tom (North East Scotland) (Con)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lindhurst, Gordon (Lothian) (Con)
Kerr, Liam (North East Scotland) (Con)
Harris, Alison (Central Scotland) (Con)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Golden, Maurice (West Scotland) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Corry, Maurice (West Scotland) (Con)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Ballantyne, Michelle (South Scotland) (Con)

Against

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
White, Sandra (Glasgow Kelvin) (SNP)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Russell, Michael (Argyll and Bute) (SNP)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
McNeill, Pauline (Glasgow) (Lab)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Lochhead, Richard (Moray) (SNP)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harper, Emma (South Scotland) (SNP)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Campbell, Aileen (Clydesdale) (SNP)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

The Presiding Officer

The result of the division is: For 28, Against 89, Abstentions 0.

Amendment 1 disagreed to.

Amendment 2 not moved.

The Presiding Officer

Group 2 is on minor and technical amendments. Amendment 9, in the name of the cabinet secretary, is grouped with amendments 20, 22 and 23.

Roseanna Cunningham

The amendments in this group are all of a minor or technical nature. Amendment 9 simply corrects the term “subsections” in section 3(2), as the reference should be to “subsection” in the singular.

Amendment 20 amends section 13 to make it clear that the Scottish ministers cannot make directions on charges for the use of assets when the Crown Estate Transfer Scheme 2017 regulates the amount that can be charged in relation to agreements concerning the granting of rights in certain circumstances such as those relating to tidal waters, pipelines or the transmission or distribution of electricity.

Amendment 22 corrects a typographical error in section 31(1), and amendment 23 is a minor technical amendment to ensure that the way in which the definition of “heritable security” is introduced is consistent with the other definitions in the interpretation section of the bill.

I move amendment 9.

Amendment 9 agreed to.

The Presiding Officer

Group 3 is on the transfer or delegation of management to harbour authorities or trust ports. Amendment 10, in the name of the cabinet secretary, is grouped with amendments 25, 12, 13, 30, 14, 32, 15, 39, 16, 40 and 24.

Roseanna Cunningham

Government amendments 10, 12 to 16 and 24 have been developed following careful consideration of Andy Wightman’s stage 2 amendments seeking to allow trust ports to be eligible to become a manager of Scottish Crown estate assets. I will also discuss amendments 25, 30, 32, 39 and 40 in the name of Tavish Scott.

I accept the principle behind Mr Wightman’s original—and now Tavish Scott’s—wish to include trust ports and consider there to be merit in expressly allowing harbour authorities operating in Scotland to be eligible to seek and be given the right to manage Scottish Crown estate assets. The foreshore and sea bed around Scotland form a significant part of the Crown estate in Scotland and might include land within a designated harbour area that a particular harbour authority operates in.

Although the concept of a trust port is recognised in Scotland, it is, in fact, not a body that is defined in legislation. Each trust port is an independent statutory body that has a unique governance arrangement and is governed by its own legislation created by an act of Parliament. Tavish Scott’s amendment 40 would insert into legislation a particular definition of “trust port” as “a port”, which is the physical structure of a harbour rather than a legal person. The definition also makes no reference to the need for a trust port to have been given the statutory authority to maintain or manage a harbour. I therefore question whether the definition of “trust port” in amendment 40 would work as intended.

Moreover, trust ports are not the only models of harbour ownership. The other main models alongside them are private ownership and local authority ports. I consider there to be merit in allowing not just trust ports but bodies that come under one of the other types of harbour ownership in Scotland to be eligible to become a Scottish Crown estate asset, as they all operate under similar legislative powers and duties.

15:00  



Amendments 10, 13 and 15 have the effect of adding Scottish harbour authorities as a category of eligible Scottish Crown estate asset manager by way of both transfer and delegation. Amendment 14 provides that, similar to a community organisation, the Scottish ministers do not have the power to direct a Scottish harbour authority that is already a manager to delegate to another manager.

The definition of “Scottish harbour authority” that is set out in amendments 16 and 24 will allow trust ports such as Lerwick Port Authority, which is in Tavish Scott’s constituency, and other Scottish harbour authorities such as Tobermory Harbour Association to be eligible for a transfer or a delegation of the management of a Scottish Crown estate asset. Although, as far as I am aware, there are no private ports in the Shetland Islands, there are private ports elsewhere—some of them are large, but there are some small private ports—and it would be inequitable to restrict the provision to the pattern of port ownership in Shetland, however desirable that may be to Tavish Scott.

Although my amendments open up the possibility of other types of harbour authority becoming a Scottish Crown estate manager, as the provision is not restricted to trust ports, it remains the case that any regulations that transfer management of the sea bed will be subject to the affirmative procedure in the Scottish Parliament. Therefore, the Parliament will have the final decision on such transfers of the sea bed. In addition, the provisions that require separate accounting arrangements for Scottish Crown estate assets from those for any other money that a manager may hold will provide adequate protection of the asset in such circumstances.

Amendment 12 provides that the transfer regulations can make provisions in respect of what happens to the management functions and the rights and liabilities in relation to an asset if a harbour authority ceases to exist or no longer has statutory powers to manage a harbour. The provisions are similar to those contained in the bill that deal with the situation in which a community organisation ceases to exist. In most circumstances, the Scottish ministers will be aware in advance that a harbour authority is likely to cease to have the statutory power to manage a harbour, as they would be involved in the legal process. In the unlikely event that a private harbour authority suddenly ceases to exist, the amendment will ensure the continuing management of the Scottish Crown estate asset. Although I have not yet heard his arguments, I encourage Tavish Scott not to move his amendments. As I have explained, I believe that the Government’s amendments deliver the same objectives as his amendments—indeed, they deliver more.

I move amendment 10.

Tavish Scott (Shetland Islands) (LD)

I take the cabinet secretary’s reasoned thinking on the matter, and I am grateful to Andy Wightman for his previous work in committee on the issue of trust ports. The issue relates to trust ports having the responsibility of managing the sea bed in their area, which is an important principle of the bill. It was a principle of the Smith commission—a number of us in the Parliament worked on that some years back in relation to island authorities and island responsibilities—and it is a recognition that, as the cabinet secretary suggested, trust ports invest all their income in the facilities that they have in order to serve the clients of a port—in other words, the harbour users of an area. The measure is an improvement, and I accept the cabinet secretary’s explanation of the Government’s amendments.

On Friday, Sandra Laurenson, the former chief executive of Lerwick Port Authority and the first female chief executive of any port in the UK, retired after 44 years of service to Lerwick and, I would argue, to the port sector as a whole. For some of us, the amendments are in honour of her great commitment to people who serve in ports the length and breadth of our country.

Claudia Beamish (South Scotland) (Lab)

I support the Government’s amendments and recognise the reasons for Tavish Scott not moving his amendments. I also support the use of the affirmative procedure.

As we are discussing the devolution of the Crown estate, can the cabinet secretary provide reassurance that the authorities and trusts are constituted in the public interest?

Roseanna Cunningham

That is why they would not be considered to be so.

John Scott

The amendments in group 3 are a response to the probing amendments that Andy Wightman lodged at stage 2 and would further devolve responsibility from the Crown Estate to harbour authorities or trust ports, providing more local autonomy. At stage 2, the Government’s concerns centred around the control of ports and harbours in relation to local authorities. We welcome the amendments and the fact that any regulations will be subject to the affirmative procedure.

On Tavish Scott’s amendments, which would extend management functions to trust ports, we have concerns over whether individual harbours and ports should have control in that decision-making process and whether they should take on the management function. We note that the cabinet secretary still has concerns about Tavish Scott’s amendments, and we share those concerns. I am not certain whether Mr Scott said that he would move his amendments, but I dare say that we will hear that in due course.

The Presiding Officer

Cabinet secretary, you might have already clarified your position in your interjection, but do you wish to wind up on this group?

Roseanna Cunningham

No, other than to say that my only concern about Tavish Scott’s amendments is that they do not go as far as the Government’s amendments. I am sure that he would be happy to concede that point.

I press amendment 10.

The Presiding Officer

The question is, that amendment 10 be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a division.

For

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
Whittle, Brian (South Scotland) (Con)
White, Sandra (Glasgow Kelvin) (SNP)
Wells, Annie (Glasgow) (Con)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Tomkins, Adam (Glasgow) (Con)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Liz (Mid Scotland and Fife) (Con)
Smith, Elaine (Central Scotland) (Lab)
Simpson, Graham (Central Scotland) (Con)
Scott, Tavish (Shetland Islands) (LD)
Scott, John (Ayr) (Con)
Sarwar, Anas (Glasgow) (Lab)
Russell, Michael (Argyll and Bute) (SNP)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
McNeill, Pauline (Glasgow) (Lab)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Mason, Tom (North East Scotland) (Con)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lochhead, Richard (Moray) (SNP)
Lindhurst, Gordon (Lothian) (Con)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Kerr, Liam (North East Scotland) (Con)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harris, Alison (Central Scotland) (Con)
Harper, Emma (South Scotland) (SNP)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Griffin, Mark (Central Scotland) (Lab)
Greene, Jamie (West Scotland) (Con)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
golden, Maurice (West Scotland) (Con)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Corry, Maurice (West Scotland) (Con)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Campbell, Aileen (Clydesdale) (SNP)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Ballantyne, Michelle (South Scotland) (Con)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

Abstentions

Ruskell, Mark (Mid Scotland and Fife) (Green)
Johnstone, Alison (Lothian) (Green)
Greer, Ross (West Scotland) (Green)
Finnie, John (Highlands and Islands) (Green)

The Presiding Officer

The result of the division is: For 114, Against 0, Abstentions 4.

Amendment 10 agreed to.

Amendment 25 not moved.

The Presiding Officer

We turn now to group 4, on the management of marine assets by local authorities. Amendment 11, in the name of Andy Wightman, is grouped with amendments 26 to 29, 31, 33 to 38 and 41.

Andy Wightman (Lothian) (Green)

As has already been mentioned, the Smith commission recommended in paragraph 33 of its final report that, following the devolution of the management of the Crown estate,

“responsibility for the management of those assets will be further devolved to local authority areas”.

Nowhere in the bill is that pledge fulfilled. Section 3(1) of the bill gives authority to the Scottish ministers to make regulations to transfer those management functions to any person mentioned in section 3(2), but it remains possible that ministers might choose not to make regulations or might choose to revoke any regulations; in addition, it remains possible that regulations might be drafted in a way that makes the transfer of management functions unduly onerous or complex.

The Smith commission recommendation makes it clear, however, that the responsibility will be further devolved. At stage 2, I lodged an amendment that would have given a statutory right to local authorities to manage the foreshore. I did not press it, on the basis that I would have further discussions with the cabinet secretary. I had those discussions with her and her officials, but got no response back. I have therefore lodged amendment 11, which is less prescriptive than the amendment that I lodged at stage 2. Amendment 11 is designed to do little more than give a nod to the cross-party consensus of the Smith commission by providing that section 3 regulations enshrine a presumption in favour of transferring management of the foreshore to local authorities. The amendment relates only to the foreshore, because it is one of the distinctive, ancient Crown property rights. Ownership by the Crown is regarded by the Scottish Law Commission as a patrimonial right derived from the Crown prerogative. It is nowhere defined in statute but is, as the commission notes, merely the predominant modern theory. It plays a distinct and critical role in coastal management, which is a function that more widely falls into the realm of local authorities.

The history, as set out in a recent book by John MacAskill that is published by Edinburgh University Press, is one in which the public interest in the foreshore has frequently been compromised by uncertainty and legal disputes. Such disputes in the 19th century included disputes over the rights of crofters to gather kelp—a topic that we will return to today. Such a right would have been enshrined in law by now had the Scottish Law Commission’s recommendation in 2003 to enact the draft sea, shore and inland waters (Scotland) bill been implemented. Fifteen years later, it has not been. Such an act would have enshrined statutory rights to, among other things, make sandcastles, beachcomb, sunbathe and have picnics on the shore and foreshore, but I digress, perhaps.

The other amendments in the group, which are all in the name of Liam McArthur, seek to ensure that section 3 regulations also make provision for the transfer of the management of the sea bed within the Scottish marine region to any local authority that requests such a transfer. Again, those amendments fulfil the recommendations of the Smith commission—recommendations that I recall were drafted by Tavish Scott, who is a former chair and trustee of Lerwick Port Authority and who knows a thing or two about the long and malign influence of the body corporate that is the Crown Estate Commissioners. We support all Liam McArthur’s amendments.

I move amendment 11.

Liam McArthur (Orkney Islands) (LD)

As Andy Wightman said, much of what we are talking about this afternoon draws heavily on the recommendations of the Smith commission, and I pay tribute to the efforts of my colleague Tavish Scott in ensuring that the recommendations fully addressed the concerns around the Crown estate.

As I said in committee at stage 2, devolution of the management of the Crown estate in Scotland to the communities with the most direct interest in and reliance on the future use of those assets is something that I have been pursuing since before I was elected in 2007, so I welcome the bill and what it can help to achieve. Like many, however, I believe that it can and must go further, not least in unlocking and securing for communities benefits that arise from developments in the marine environment—at this stage—out to 12 nautical miles.

This is not just about the revenues, though. It is also about how the assets are managed. My amendment 26, much like Andy Wightman’s amendment 11, makes it clear that relevant local authorities would have the right to request the transfer of responsibility for the management of any area of the sea bed from the mean high water spring tides out to 12 nautical miles. The details of that process would be set out in regulations by ministers, which would be subject to review by Parliament, and they would give effect to recommendation 32 of the Smith commission.

Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

I think that the member will recall that I previously raised the issue of the sea between Bute and Arran. The distance between the two islands, which are in different local authority areas, is less than 24 miles. The amendments in the group that we are discussing are constructed in such a way that it would be impossible for the two councils to get out to 12 miles without overlap. Has the member given further thought to how that issue—I accept that it is a special case that does not attach to the generality of the argument—would be dealt with?

Liam McArthur

I appreciate that, and I appreciate the fact that Stewart Stevenson, as he said, raised the issue at stage 2. It is not, I believe, a unique concern in relation to the bill. I believe that it could be dealt with through the regulation-making powers that amendment 26 puts in place.

As Andy Wightman reminded us, the Smith commission called in its recommendations for the devolution of the assets to the Scottish Parliament, but it went on to state:

“Following this transfer, responsibility for the management of those assets will be further devolved to local authority areas such as Orkney, Shetland, Na h-Eilean Siar or other areas who seek such responsibilities.”

Some will argue that communities and not just local authorities should have the option of making those requests. That point will be raised in relation to my amendments and amendment 11. I have some sympathy with that, but I am sure that it can be addressed through subsequent regulation. In any event, the devolution of management responsibility to local authorities does not preclude—indeed, it should encourage—local authorities to further devolve that responsibility to local communities where appropriate.

The other amendments in the group are consequential to amendment 26, with the exception of amendment 41. I know from speaking to colleagues in other parties in recent days that there are questions about limiting the application of the request power to local authorities that are defined in the Islands (Scotland) Act 2018. That might seem a little overzealous, although I believe that those that are listed in the schedule to that act are the most likely to have the opportunity, the appetite and the experience to make best use of the powers. However, I recognise that in the future other local authorities and communities may wish to make requests to manage the marine assets of their shores, so I will listen to what other colleagues have to say before I decide whether to move amendment 41. I will, however, move amendment 26.

15:15  



John Scott

This group of amendments in the names of Liam McArthur and Andy Wightman seek to devolve the management of marine assets, including the foreshore and sea bed, to local authorities, where they request it. At stage 2 the Government expressed concerns that local authorities might not always be best placed to manage the sea bed and the foreshore and that is a view that we share. In addition, the committee came to the view in its stage 1 report, in recommendation 362, that the sea bed is a national asset and should be managed nationally, so we are unable to support this group of amendments.

Claudia Beamish

We will support the amendments in group 4. Points have been made about the Smith commission, so I will not elaborate on that, but recognising the commitments that were made at that time in a cross-party way is a very important aspect of the devolution. I wonder if, in summing up, Andy Wightman might highlight something about the presumption in favour of local authorities in his amendment 11, which is that, in his view, that would not preclude further devolution to community groups. Liam McArthur has also highlighted that point.

Although we will support the amendments, I want to highlight some concerns that we on the Labour benches have about the points that John Scott made, particularly in relation to local authorities, their training and their capacity to monitor sea bed issues in the face of council cuts.

The issue around other local authorities is complex. The Smith commission recommendations, as already highlighted, suggest that it is the island local authorities to which these provisions should refer. Labour is minded to leave it that way for the moment, but if in the future—as I think Liam McArthur pointed out—other local authorities have an interest, regulations might have to be considered or reconsidered.

Roseanna Cunningham

The Government will not support the amendments. They cut across the policy of giving community organisations the opportunity to take on the management of a Scottish Crown estate asset, including the foreshore. Amendment 26 would place a duty on the Scottish ministers to make regulations to transfer to “a relevant local authority” that requests it,

“the right to manage any area of the seabed”,

including the foreshore. It could therefore prevent a community organisation from directly taking on the management of a Crown estate asset. Although no community organisations from Orkney and Shetland have so far expressed interest in the local asset management pilots, there is interest from community organisations in the Western Isles, Argyll and Bute, Highland Council and the Clyde area. I recognise that with amendment 11 Mr Wightman seeks only to create a presumption in favour of local authorities. Nonetheless, I am of the view that there should be as much of a presumption in favour of community organisations managing Scottish Crown estate assets. The bill does not contain any presumptions about who should manage any particular Crown estate asset and that is as it should be, as it allows for consideration on a case-by-case basis and allows those who wish to manage an asset to demonstrate why they are best placed to do so.

Amendment 26 seeks to require ministers to transfer the right to manage the sea bed

“out to 12 nautical miles”

if any of the following local authorities request that: Argyll and Bute Council, Western Isles, Highland Council, North Ayrshire Council, Orkney Council and Shetland Council. There are technical issues with the amendment, including its reference to an area of sea bed within its relevant Scottish marine region.

Although the reference to the Scottish Marine Regions Order 2015 might work for the Northern and Western Isles, it would be less useful for the other island councils where the marine regions do not directly correspond to local authority boundaries. For example, there are three Scottish marine regions that include parts of the marine area adjacent to Highland Council, and one of those regions—the Moray Firth Scottish marine region—also includes the marine area adjacent to Moray Council. Also, the Clyde marine region includes part of the marine area adjacent to Argyll and Bute Council and part of that adjacent to North Ayrshire Council, as well as the marine areas adjacent to other councils, including Inverclyde and South Ayrshire.

No parliamentary procedure is specified for the regulations. Although the bill requires

“Regulations under section 3(1)”

to be

“subject to the affirmative procedure if they ... relate to an asset all or part of which is situated in, or relates to, the Scottish marine area or the Scottish zone”,

that provision would not apply to regulations under new subsection 3(2A), which amendment 26 would insert.

It is also unclear what is meant by the transfer of “the right to manage” the sea bed, rather than the

“transfer of ... the function of managing”

it.

Amendment 31 is similar to amendment 26, but would require ministers to direct Crown Estate Scotland to transfer part of the sea bed, out to the 12-mile nautical limit, to a local authority, if the local authority so requests. The amendment refers to

“the transfer of an asset”,

rather than to delegation of the management of an asset, which is what section 4 of the bill is about. I think that the intention is to require delegation of the management function, rather than transfer of ownership. That creates a similar problem to amendment 26, by cutting across community organisations’ ambitions to become managers of Scottish Crown estate assets.

I expect that local authorities would seek a transfer of management under section 3 of the bill, and that it would be more likely that ministers would use the power under section 4 to direct a local authority to delegate the management of an area of foreshore managed by it to a community organisation. However, it is also possible that a community organisation would like the management of an asset to be delegated to it directly by Crown Estate Scotland. Mr McArthur’s amendment 33 appears to be intended to prevent that. I cannot understand why community organisations should not have the ability to have delegated to them management of an area of the immediate foreshore that they have an interest in managing.

Perhaps it would be helpful to explain the effect of section 4(2). Section 4(2)(a) covers the rather obvious point that ministers cannot direct themselves to do anything. The assumption underlying section 4(2)(b) is that a community organisation is managing its local asset, so it is unlikely that it would seek to delegate that management to another person. To do so would be to give away the community’s control over decision making. If it did not want to continue the management of the asset, it could ask ministers to transfer the management to another manager, be that a local authority, Crown Estate Scotland or another Scottish public authority. We would not want to preclude community organisations from managing local Scottish Crown estate assets, whether under transfer or delegation.

Therefore, I cannot support Andy Wightman’s amendment 11 or Liam McArthur’s amendments 26 to 29, 31, 33 to 38 and 41. Moreover, there are serious technical deficiencies in Liam McArthur’s amendments, which, as I have outlined, render them unworkable. I urge Mr Wightman and Mr McArthur not to press their amendments.

The Presiding Officer

I call Andy Wightman to wind up, and to press or withdraw amendment 11.

Andy Wightman

In response to Claudia Beamish, no, my amendment would not preclude transfers to others.

The amendments—I cannot speak for Liam McArthur’s, but this is certainly true of mine—are designed to uphold the fundamental principles agreed by the Conservatives, the SNP, Labour, the Liberal Democrats and the Scottish Greens in the Smith commission.

I reject the notion that amendment 11 cuts across community bodies. In any event, we do not believe that the Scottish ministers should be the final arbiters of that. Underpinning my amendment is the notion that it is the place of local government to make such decisions, not the Scottish ministers. Furthermore, the amendments are concerned only with regulations. Amendment 11 stipulates that regulations should provide only for a “presumption”. Regulations are well capable of incorporating such a provision.

Liam McArthur’s amendments, again, place clear duties to be implemented by regulations. They provide plenty flexibility to frame the duty in the most appropriate manner.

I note that neither the Government nor the Conservatives support the amendments, so I will not detain members any further. However, I am disappointed by the Government’s response. It is a betrayal of a clear commitment made by the Smith commission, and I am further disappointed that we were not able to reach an agreement on the principles behind the amendment that I lodged at stage 2.

I press amendment 11.

The Presiding Officer

The question is, that amendment 11 be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a division.

For

Wightman, Andy (Lothian) (Green)
Stewart, David (Highlands and Islands) (Lab)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Sarwar, Anas (Glasgow) (Lab)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Rennie, Willie (North East Fife) (LD)
McNeill, Pauline (Glasgow) (Lab)
McArthur, Liam (Orkney Islands) (LD)
Marra, Jenny (North East Scotland) (Lab)
Macdonald, Lewis (North East Scotland) (Lab)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Harvie, Patrick (Glasgow) (Green)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Dugdale, Kezia (Lothian) (Lab)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Bibby, Neil (West Scotland) (Lab)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)

Against

Yousaf, Humza (Glasgow Pollok) (SNP)
Whittle, Brian (South Scotland) (Con)
White, Sandra (Glasgow Kelvin) (SNP)
Wells, Annie (Glasgow) (Con)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Tomkins, Adam (Glasgow) (Con)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Scott, John (Ayr) (Con)
Russell, Michael (Argyll and Bute) (SNP)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McAlpine, Joan (South Scotland) (SNP)
Mason, Tom (North East Scotland) (Con)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lochhead, Richard (Moray) (SNP)
Lindhurst, Gordon (Lothian) (Con)
Kidd, Bill (Glasgow Anniesland) (SNP)
Kerr, Liam (North East Scotland) (Con)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harris, Alison (Central Scotland) (Con)
Harper, Emma (South Scotland) (SNP)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
Golden, Maurice (West Scotland) (Con)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Corry, Maurice (West Scotland) (Con)
Constance, Angela (Almond Valley) (SNP)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Campbell, Aileen (Clydesdale) (SNP)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Ballantyne, Michelle (South Scotland) (Con)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

The Presiding Officer

The result of the division is: For 33, Against 85, Abstentions 0.

Amendment 11 disagreed to.

Amendment 26 moved—[Liam McArthur].

The Presiding Officer

The question is, that amendment 26 be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a division.

For

Wightman, Andy (Lothian) (Green)
Stewart, David (Highlands and Islands) (Lab)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Sarwar, Anas (Glasgow) (Lab)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Rennie, Willie (North East Fife) (LD)
McNeill, Pauline (Glasgow) (Lab)
McArthur, Liam (Orkney Islands) (LD)
Marra, Jenny (North East Scotland) (Lab)
Macdonald, Lewis (North East Scotland) (Lab)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Harvie, Patrick (Glasgow) (Green)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Dugdale, Kezia (Lothian) (Lab)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Bibby, Neil (West Scotland) (Lab)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)

Against

Yousaf, Humza (Glasgow Pollok) (SNP)
Whittle, Brian (South Scotland) (Con)
White, Sandra (Glasgow Kelvin) (SNP)
Wells, Annie (Glasgow) (Con)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Tomkins, Adam (Glasgow) (Con)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Scott, John (Ayr) (Con)
Russell, Michael (Argyll and Bute) (SNP)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McAlpine, Joan (South Scotland) (SNP)
Mason, Tom (North East Scotland) (Con)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lochhead, Richard (Moray) (SNP)
Lindhurst, Gordon (Lothian) (Con)
Kidd, Bill (Glasgow Anniesland) (SNP)
Kerr, Liam (North East Scotland) (Con)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harris, Alison (Central Scotland) (Con)
Harper, Emma (South Scotland) (SNP)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
Golden, Maurice (West Scotland) (Con)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Corry, Maurice (West Scotland) (Con)
Constance, Angela (Almond Valley) (SNP)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Campbell, Aileen (Clydesdale) (SNP)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Ballantyne, Michelle (South Scotland) (Con)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

The Presiding Officer

The result of the division is: For 33, Against 85, Abstentions 0.

Amendment 26 disagreed to.

Amendment 12 moved—[Roseanna Cunningham]—and agreed to.

Amendments 27 and 28 not moved.

Section 4—Directions requiring delegation of management function

Amendment 29 not moved.

Amendment 13 moved—[Roseanna Cunningham]—and agreed to.

Amendments 30 and 31 not moved.

Amendment 14 moved—[Roseanna Cunningham]—and agreed to.

Amendments 32 to 37 not moved.

Section 5—Delegation agreements

Amendment 38 not moved.

Amendment 15 moved—[Roseanna Cunningham]—and agreed to.

Amendment 39 not moved.

Section 6—Meaning of “community organisation”

Amendment 16 moved—[Roseanna Cunningham]—and agreed to.

After section 6

Amendments 40 and 41 not moved.

15:30  



Section 7—Duty to maintain and enhance value

The Presiding Officer

Group 5 is on the duty to maintain and enhance value. Amendment 17, in the name of the cabinet secretary, is grouped with amendment 18.

Roseanna Cunningham

Amendment 17 has been developed in response to a debate at stage 2 on the amendments that Mark Ruskell and I lodged in respect of the duties on any manager in relation to how they should manage a Scottish Crown estate asset. I thank both Mark Ruskell and Claudia Beamish for the constructive conversations on this issue that we have had between stage 2 and today.

Amendment 17 places an obligation on managers that, in maintaining and seeking to enhance the value and return of Scottish Crown estate assets, they must

“act in the way best calculated to further the achievement of sustainable development in Scotland, and ... seek to manage the assets”

in a way that is likely to contribute to the promotion or the improvement of the wider socioeconomic and environmental factors that are listed.

Amendment 18 is consequential on amendment 17. It deletes “sustainable development” from the list of socioeconomic and environmental factors in section 7(2), because the duty to manage the asset in a way that contributes towards sustainable development will feature on its own in section 7(2)(a), if amendment 17 is agreed to.

I recognise the concerns that have been expressed about section 7(2) of the bill as introduced and that is why I lodged an amendment at stage 2. That amendment was not accepted and I undertook to discuss the issues further with interested members. As a result of those discussions, I lodged the amendments in this group, which retain the overarching commercial duty but give greater prominence to sustainable development.

I have listened to members’ concerns about the need to strengthen the duty and to the other concerns that have been expressed about the need to maintain the revenue and capital value of the estate. The solution that I have proposed seeks to maintain the value and income from Scottish Crown estate assets while requiring managers to act in a way that they think is most likely to further sustainable development, and also to strengthen the requirement on managers to actively try to achieve the wider socioeconomic and environmental factors in carrying out that management.

I move amendment 17.

John Scott

As already discussed by the cabinet secretary, amendment 17 is about the “may” versus “must” argument. The Scottish Conservatives believe that section 7 of the bill as introduced was perfectly adequate, and left discretion with Crown estate managers as to whether they needed to consider economic development, regeneration, social wellbeing, environmental wellbeing and sustainable development—presumably that was the view of the cabinet secretary at the time that the bill was introduced.

However, following the stage 1 report, the Government lodged an amendment in response to the majority view of the committee that the Crown Estate must consider the above list; some colleagues, such as Claudia Beamish, thought that the amendment did not go far enough, while Conservative members thought that it went too far. The status quo in the bill as introduced therefore remained in place.

Today, in amendment 17—and amendment 21—the Government has reintroduced “must” into the remit of managers, who must once again seek to further sustainable development as well as deliver economic development, regeneration, social wellbeing and environmental wellbeing. However, although we support the aspiration to do all those tasks, we remain to be convinced that this change is an improvement on the bill as introduced. We will therefore not support amendments 17 and 18.

Claudia Beamish

This is an important aspect of the devolution of managerial responsibilities. Sustainable development should have the “must” rather than the “may.” I am delighted that the cabinet secretary agrees with that position and I thank her for the discussions following the stage 2 amendment, which was supported by my colleague Alex Rowley and I in committee. It is important to have a list that highlights economic development, regeneration, social wellbeing and environmental wellbeing, as they are of fundamental importance to the future of the people of Scotland. Therefore we are very supportive of amendments 17 and 18.

The Presiding Officer

I call the cabinet secretary to wind up.

Roseanna Cunningham

I do not wish to say too much more, other than perhaps to point out to those such as John Scott who are not happy about the idea that sustainable development should be one of the things that is taken on board that, in fact, there are at least three other mentions in other pieces of legislation of sustainable development or similar functions being part of a manager’s duty.

John Scott

For the avoidance of doubt and misunderstanding, sustainable development is very much part of the bill as introduced and we are happy to support that position.

Roseanna Cunningham

In that case, I think that the argument is about “may” and “must”; that argument has probably been had in the chamber many times in relation to many different sections of the bill. We simply want to place beyond doubt the fact that something must be considered rather than perhaps being regarded as an optional extra. There was a suggestion that that might be the case.

I was trying to point out that Crown Estate managers are under obligations that derive from other pieces of legislation, too. With this legislation, we are trying to ensure that it is clear on the face of the bill that the obligation applies.

The Presiding Officer

The question is, that amendment 17 be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a one-minute division.

 

For

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
White, Sandra (Glasgow Kelvin) (SNP)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Sarwar, Anas (Glasgow) (Lab)
Russell, Michael (Argyll and Bute) (SNP)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
McNeill, Pauline (Glasgow) (Lab)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Lochhead, Richard (Moray) (SNP)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harper, Emma (South Scotland) (SNP)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Campbell, Aileen (Clydesdale) (SNP)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

Abstentions

Whittle, Brian (South Scotland) (Con)
Wells, Annie (Glasgow) (Con)
Tomkins, Adam (Glasgow) (Con)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Scott, John (Ayr) (Con)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Mason, Tom (North East Scotland) (Con)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lindhurst, Gordon (Lothian) (Con)
Kerr, Liam (North East Scotland) (Con)
Harris, Alison (Central Scotland) (Con)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Golden, Maurice (West Scotland) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Corry, Maurice (West Scotland) (Con)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Ballantyne, Michelle (South Scotland) (Con)

The Presiding Officer

The result of the division is: For 89, Against 0, Abstentions 28.

Amendment 17 agreed to.

Amendment 18 moved—[Roseanna Cunningham].

The Presiding Officer

The question is, that amendment 18 be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a 30-second division.

For

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
White, Sandra (Glasgow Kelvin) (SNP)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Sarwar, Anas (Glasgow) (Lab)
Russell, Michael (Argyll and Bute) (SNP)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
McNeill, Pauline (Glasgow) (Lab)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lyle, Richard (Uddingston and Bellshill) (SNP)
Lochhead, Richard (Moray) (SNP)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harper, Emma (South Scotland) (SNP)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Campbell, Aileen (Clydesdale) (SNP)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

Against

Scott, John (Ayr) (Con)

Abstentions

Whittle, Brian (South Scotland) (Con)
Wells, Annie (Glasgow) (Con)
Tomkins, Adam (Glasgow) (Con)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Mason, Tom (North East Scotland) (Con)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lindhurst, Gordon (Lothian) (Con)
Kerr, Liam (North East Scotland) (Con)
Harris, Alison (Central Scotland) (Con)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Golden, Maurice (West Scotland) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Corry, Maurice (West Scotland) (Con)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Ballantyne, Michelle (South Scotland) (Con)

The Presiding Officer

The result of the division is: For 88, Against 1, Abstentions 27.

Amendment 18 agreed to.

Section 8A—Restriction on power to act as owner in relation to the harvesting of wild kelp

The Presiding Officer

Group 6 is on the harvesting of sea kelp. Amendment 6, in the name of Mark Ruskell, is grouped with amendments 7, 8, 19, 21, 21A and 21B.

Mark Ruskell (Mid Scotland and Fife) (Green)

The amendments in this group deal with both a threat and an opportunity. The threat is to our last great wilderness in Scotland, the ancient kelp forests—hidden, rich nurseries of nature and commercial fish; vast stores of carbon larger than our rainforests; and defenders of our coastlines against the storms to come. The threat comes not from the harvesting of kelp per se but from the harvesting of kelp in a way that prevents it from regrowing. We know that, if kelp is removed in its entirety from the sea bed, it may never grow back. Once it has gone, its benefits may be lost for ever. The opportunity is to recognise that kelp, if harvested and farmed sensitively, is a wonderful material for food and industrial purposes, which can support livelihoods in remote communities.

It is the job of Government to set the bar high for the public interest but to allow industry to innovate and respond within environmental limits. Amendments 21A and 21B, in my name, seek to insert a golden rule into the licensing framework that is spelled out by the cabinet secretary in amendment 21, which is simply that kelp must be harvested in a way that does not inhibit the regrowth of the plants. That golden rule is well established and the wording reflects the existing licences for those who already harvest kelp using non-industrial methods. The amendment is worded carefully to ensure that it covers only situations in which the kelp material that is removed is used for commercial purposes. When it is removed and discarded, such as when clearing navigation channels, harbours or other infrastructure, such as nuclear power plant cooling systems, the amendment would not apply.

Amendments 6, 7 and 8 are Latin corrections, which is embarrassing for somebody who has a biology degree—I will blame Microsoft spellchecker, Presiding Officer. I will not press those amendments, as the cabinet secretary has corrected my Latin homework in her amendment 21.

We will support amendment 19, which removes the golden rule that was inserted by my amendment at stage 2 and allows it to be reinserted via amendments 21A and 21B, which I lodged with the valued support of my colleague Claudia Beamish.

I move amendment 6.

Roseanna Cunningham

We all want to protect kelp as an important feature of our marine biodiversity, because of the habitat that it provides for other species, including fish, and the key role that it plays in coastal and climate protection. I have listened to views on these important but complex issues and I have decided to lodge amendments at stage 3 to remove and replace section 8A, because the section on kelp that was inserted at stage 2 would not have achieved what was intended and could have had serious unintended consequences.

The test to be met in section 8A, of not inhibiting the regrowth of an individual plant, when combined with an absolute prohibition on harvesting that inhibits regrowth could prevent the very scientific research that we need to better understand the recovery rate of these species in various conditions in Scottish waters.

Section 8A would also have prevented non-commercial but essential maintenance work for safety reasons, such as removing seaweed around cooling systems in power stations or from navigation channels in ports. An example is a marine licence that was issued to EDF Energy, the operator of Hunterston B power station, in August 2017 for the removal of 150 tonnes of various species of seaweed in an area local to the Hunterston cooling water intake. Nor can I guarantee that section 8A would have no impact on existing sustainable seaweed harvesting and the associated income and employment that our rural areas depend on.

For all the reasons that I have outlined—particularly because section 8A would clearly prevent activity of public interest, such as scientific research that is needed to improve our scientific knowledge of kelp habitats and their rate of recovery—I do not support section 8A. For those reasons, section 8A cannot be left in the bill at this important and final stage of the bill’s progress through Parliament.

Turning to amendment 21, I remain of the view that the Scottish Crown Estate Bill is not the optimal place to control seaweed harvesting. However, Mark Ruskell’s amendments have surfaced a range of issues regarding the regulation of current and proposed harvesting activity in this emerging sector. The issues are complex, many and varied and require the gathering of further evidence.

Andy Wightman

Does the cabinet secretary accept that the report of the Scottish Law Commission in 2003—which proposed quite a considerable modernisation of the law of the foreshore and sea bed, including provisions on kelp and crofters’ rights to gather kelp—would have been a better place to put this issue? Will she consider introducing such a bill in this parliamentary session?

Roseanna Cunningham

I am not going to be drawn on increasing the legislative programme in this parliamentary session. I am happy to talk to Andrew Wightman and anybody else who has any further bright ideas, but I would rather focus simply on where we are at the moment.

15:45  



Because we are having this debate in the context of the Scottish Crown Estate Bill, there are some issues that need to be put before the chamber. We need to ensure that existing activity and future proposals are sustainable, and I have listened to all the views that have been expressed. Amendment 21 would put it on a statutory footing that a Scottish Crown estate manager cannot grant a right to remove wild kelp if the removal is a marine licensable activity and no marine licence has been obtained. That would apply to all managers and would therefore future proof current good practice that is not as we speak a requirement in legislation. The amendment also makes it clear that the granting of such a right is void if a marine licence is required and has not been given. In addition, the amendment would meet the important test of ensuring that we can still undertake scientific research to enhance our knowledge of kelp, which would be put at risk by section 8A as introduced at stage 2.

Mark Ruskell’s amendment 21A to my amendment 21 reintroduces the key provisions from his original amendment prohibiting the removal of certain species of wild kelp where removal inhibits the regrowth of an individual plant. A critical difference is that the provision is now limited to commercial use only. As I have mentioned, the bill is not the best place for a control of that type. For example, it applies only to a manager of the Scottish Crown estate, and only half of the foreshore is part of the Scottish Crown estate, so the amendment would not deliver the protection sought in all parts of Scotland where the species are found. There is also a risk that amendment 21A could cut across the marine licensing system that Parliament voted for, which is contained in the Marine (Scotland) Act 2010.

However, I am aware of concerns that have been expressed in the debate over the past weeks. I have listened carefully to those concerns and, having considered them at length, I am willing to provide my support to amendment 21A. I have concerns about the lack of definition provided in it as to the meaning of the terms “commercial use” and “removal”, so I want to make clear that I support the amendment on the basis that we are not seeking to prevent scientific research from continuing to improve our scientific understanding of kelp, kelp habitats and kelp recovery potential or appropriate research and development for public health purposes such as pharmaceuticals; that, as Mark Ruskell has alluded to, it will not prevent power stations, commercial ports or other similar public infrastructure from removing kelp species for maintenance purposes or other public interest reasons; and that it will not prevent hand cutting above the base of the meristem, where growth occurs, or prevent harvesting by hand cutting that Scottish Natural Heritage has advised is sustainable. It is important that I make those assertions in the chamber.

I am confident that those who have proposed amendment 21A will agree that it is not intended to cut across the points that I have just outlined. I am highlighting them to ensure, and I invite those members to confirm, that that is the case for the sake of clarity about the Parliament’s intentions in voting on the amendment. I cannot guarantee that amendment 21A will have none of those unintended impacts or that it will have no impact on existing sustainable seaweed harvesting. If some of those specific issues arose, I would have to consider the need to legislate further.

I will also consider the need for guidance or directions to managers on the issues if the amendments are agreed to. Furthermore, I plan to keep the situation under review and do not wish unreasonably to block the future development of forms of harvesting that we might in time establish, through a proper assembling of the evidence, is sustainable. For the time being, given the increasing profile of kelp harvesting as an activity, and in view of the need to further our understanding of kelp species, kelp habitats and kelp recovery potential, it is my intention to keep these matters under review. I am therefore announcing to Parliament today a review of the regulatory regime for all kelp harvesting activity.

Members may be interested to know that currently there are five different ways in which kelp can be harvested commercially—it is not simply hand versus mechanical harvesting—and all those should be part of the review. It will therefore include harvesting that is not currently a licensable activity and which I am advised is deemed to be sustainable but where it seems proportionate and appropriate to examine whether it should be included within an expanded licensing regime. I am confident that the licensing process is robust and thorough and does what it is supposed to do effectively. I am also conscious of the need for continuous improvement in how we regulate activities in our marine environment, particularly where there is interest in undertaking new or novel activities.

I am therefore giving a commitment to Parliament that Marine Scotland will undertake a strategic programme of work, including a review of the regulatory regime for all kelp harvesting activity in Scotland. That will recognise the need to take fully into account in licensing decisions the environmental implications of the removal of kelp from the marine environment by any method, develop locational guidance for potential kelp resources areas and outline the research and evidence-base requirements, so that we are better informed on the environmental impacts of developing the kelp industry. That will enable us to make informed decisions on the sustainable development of the seaweed sector.

Mark Ruskell

I thank the cabinet secretary for the commitment to the review. Could she confirm that independent scientific advice, particularly from seaweed academic specialists who understand the area, will be used in the review?

Roseanna Cunningham

I will expand on that issue later.

The work that I am talking about will involve consideration of the need for a pilot project, on an appropriate scale and design and at an appropriate location, to collect evidence on the potential environmental impacts of seaweed harvesting and on regeneration potential. I have instructed officials to form a steering group, with representatives from key environmental agencies, non-governmental organisations and sectoral stakeholders, for that strategic programme of work. The group will first establish the timetable for the work programme in the coming months, including arrangements for reporting progress, before ultimately overseeing the delivery of the work programme.

I want to make it clear that the review is not being undertaken because of any deficiency that has been identified in the marine licence system. In fact, in my view, the system is robust and being shown to work, but I am conscious that there is current interest—there might be more interest in future—in new types of seaweed harvesting in Scottish waters.

The review seeks to promote a spirit of continuous improvement and to ensure that we are pushing at the limits of having the very best regime possible. I hope that I have outlined a proportionate way forward, given the current evidence base and complexities.

The Presiding Officer

Five members wish to speak on this group.

John Scott

The group of amendments on the harvesting of sea kelp is the only really contentious part of the bill. The cabinet secretary has outlined why, and I welcome her announcement.

It was a surprise that amendment 42, which was lodged by Mark Ruskell at stage 2, was accepted for consideration, because it was widely accepted that the matter is a licensing issue and should not have been part of the bill. However, the Green amendment became part of the bill as amended at stage 2, and today we welcome the Government’s amendment 19, which will leave out section 8A. The matter should have rested there, and the proposal for kelp harvesting from Marine Biopolymers Ltd should have been dealt with in the normal well-defined licensing and regulatory way.

However, the Government has acknowledged, as did we, that there are valid concerns about the harvesting of Laminaria hyperborea that need to be dealt with. That such concerns have developed—notwithstanding what the cabinet secretary has just said—suggests that the public have no faith in our licensing system or in our regulatory bodies and development agencies, such as Marine Scotland, Scottish Enterprise and other investment agencies, whose advice and help MBL has sought and relied on in developing the harvesting process, as well as in the development of a range of groundbreaking medically significant products.

That those well-articulated public concerns are now driving the debate and support for Mark Ruskell’s amendment 21A leaves me, too, wondering whether the whole development process is fit for purpose, because despite MBL proposals having passed through every regulatory hoop for the past eight years, we have reached a position today where the Conservatives, and Parliament, will accept Mark Ruskell’s amendment, because we accept that the concerns that he and others have expressed might be valid.

John Finnie (Highlands and Islands) (Green)

Will the member take an intervention?

John Scott

I would rather not, if the member will forgive me.

If companies such as MBL are not to be forever deterred from carrying out research and development work, with a view to bringing new products to market that are derived from natural resources, the whole regulatory and development system has to be changed—perhaps radically—or would-be investors and innovators will never again look at Scotland as a place to do business. Therefore, I welcome the cabinet secretary’s announcement of a root-and-branch review of the whole matter. Given the circumstances in which we find ourselves, such a review is perhaps long overdue.

Claudia Beamish

I speak in support of Roseanna Cunningham’s amendment 21. It is a helpful amendment with regard to good practice in future proofing. I particularly welcome the review of the regulatory regime and that issues will be looked into on a scientific basis. That is important for sustainable development of our shores.

The Scottish Crown Estate Bill devolves management of assets that are owned by the Crown in the public interest. The sea bed forms part of those assets; thus, it is owned by the people of Scotland and is a public good that must be managed in all our interests. That means that sustainable development must be at the core of all decision making by managers.

Mark Ruskell’s amendment 21A, which I support, would provide that the Crown Estate could not grant the right of harvesting wild kelp from any area of the sea bed under its management where such harvesting

“would inhibit the regrowth of the individual plant”,

which is fundamental to sustainable development. As such, it is essential that that is stated robustly as part of the framework for future kelp harvesting in our inshore waters. That is particularly important in view of the broader review of seaweed licensing that the cabinet secretary announced today.

Kelp forests are protected as priority marine species, and are important because of blue carbon. Over a number of years I have worked—not least, with the new Minister for Energy, Connectivity and the Islands, Paul Wheelhouse—to get blue carbon into the climate change plan, because it is important for reducing our future emissions. The national marine plan details the issue of climate change, and Scottish Environment LINK stressed in its submission to the committee on the Climate Change (Emissions Reduction Targets) (Scotland) Bill that Scotland should seek to reduce “pressure on carbon sinks” and consider opportunities to “enhance blue carbon habitats”. We should not diminish opportunities: we must not take that risk.

Fundamental issues include ecosystem protection, prevention of coastal erosion and protection of juvenile fish and sea birds that feed on sand eels—which I saw for myself on the north Harris snorkel trail last summer—which are a priority species. Any future harvesting of the range of kelps under the devolved arrangements should continue to be sustainable, as it is at present.

I turn to community and industry concerns, and the support for amendment 42, at stage 2, on regrowth of kelp. There was a wide range of submissions—I acknowledge that they came after stage 2—to the ECCLR Committee expressing clear and cogent reasons why the kelp amendments are valid and should be agreed to today. Some submissions are scientific and well referenced, and others are about the right to our kelp forests as a public good.

There were submissions from fishermen’s organisations such as the 400-member Scottish Creel Fishermen’s Association, from hand divers for scallops and from trawlermen. Those groups are not always in harmony, but they agree on this matter, which is a good step. There were submissions from hand gatherers of kelp for artisan use, from marine tourism companies and from community councils. I welcome to the gallery many of those people who are, along with some primary school children, here to hear how the bill progresses.

There is research being done on and there is limited farming of seaweed in Scottish waters. As I understand it—the cabinet secretary confirmed this—those will not be affected by amendment 21A, which is welcome.

At stage 2, when supporting amendment 42, I stressed that this is about future protection of, and sustainable harvesting arrangements for, Scotland’s kelp. It is not about individual applications. If this was a land issue, there would be no question about not upholding the principle of sustainable harvesting. There must be no such question in respect of our inshore waters. Although planted forests are harvested on land, native forests and woodlands are not, with the exception of limited-scale coppicing, which allows regrowth.

In the view of Scottish Labour, this sea justice issue is parallel to land justice issues. I add our support for the amendments in the group.

16:00  



Gail Ross (Caithness, Sutherland and Ross) (SNP)

I thank the following people, some of whom are with us in the gallery, and I acknowledge their huge contribution. They are: Noel, Janis and the Ullapool sea savers—Fin, Maia, Alicia, Caillin and Poppy and others who cannot be with us today; the Sunnyside ocean defenders; all the individuals and businesses who got in touch, signed open letters and petitions; and especially Ailsa McLellan, whose tireless campaigning has been nothing short of inspirational. I acknowledge their huge contribution.

I welcome the position that has been outlined by the cabinet secretary. I thank Mark Ruskell, Claudia Beamish and Finlay Carson for the way in which they have worked on a cross-party basis to deliver this result.

In supporting the amendments on restriction of removal of wild kelp from the sea bed, we ensure not only sustainability of the marine environment, but sustainability of the local hand harvesters, who do so much to manage the kelp supply. That is not to suggest that we want to restrict economic or research activity: far from it. The proposed regulatory regime, as outlined by the cabinet secretary, gives us the opportunity to ensure that we protect our marine environment and encourage sustainable business, and take the wide range of research opportunities that are open to us.

I welcome the review that has been announced by the cabinet secretary. It will give us a chance to hear and put on the record the evidence that we need in order to ensure that we can achieve the aims that we outline today.

Recently, some people in the industry have said that the proposal sends out the wrong economic message, but I say that it sends out the correct environmental message.

Johann Lamont (Glasgow) (Lab)

I will declare an interest and note that I probably have less expertise than everybody else who has spoken thus far.

The interest that I declare is that my forebears would have harvested kelp. When they were cleared off the land, they relied on the sea for sustenance. They had to leave the land where they wanted to stay: they were part of the significant migration out of the Highlands and Islands into our cities, because there was no work for them to do.

We must see the debate on kelp, and the interest that it has generated, in that context. We must not see it as something obscure that is happening somewhere else, but as something that happened generations ago, when there was a failure to create economic opportunities for our communities.

Andy Wightman

Will the member take an intervention?

Johann Lamont

Let me make some progress.

I have welcomed the willingness over time of Governments of all stripes to seek economic opportunities to sustain fragile, remote and rural communities, and the willingness to harness the energy of the wind and the sea in the interests of the people of such communities. We need to see the issue in that context. There must be environmental protections, but we should be willing to look at the economic and social impacts as well as at the environmental impact.

I note what the cabinet secretary said and I welcome her reassurance that she sees the matter in the context of protection not just of the environment, but of the economies of communities. I ask her to make a further commitment, if she speaks again, to economic regeneration for such communities.

Perhaps when he sums up, Mark Ruskell can address this question: is all commercial interest bad? A community or co-operative enterprise would still have to be commercially viable. We should be looking for commercial opportunities for people in those communities, with the protections that have been identified. I seek reassurance from Mark Ruskell, who lodged amendment 21A, that he is not suggesting that we rule out all harvesting of kelp when there might be a commercial interest in harvesting it. We are all committed to protection of our environment, but we have a duty to look at proposals also in terms of the social and economic impacts on communities.

Again, I reflect on what the cabinet secretary said. In the conversation about the issue, the language itself has created a reaction. To say that an approach is “industrial” is pejorative. It has to be an economic approach that protects the environment and creates jobs for people who want to stay in those communities. There must be protections, but we should view the matter in the context of communities that have the right to say that they want economic opportunities in their communities, as well as elsewhere.

In conclusion, because we have been lobbied on the issue, it is important to recognise that the people who want kelp to be taken from the seas do so out of a desire to create economic opportunity or to develop our scientific understanding of the environment. I would like to be reassured that we are not simply putting science to one side.

John Finnie

Does Johann Lamont accept that the proponents of amendment 6 do not want to see an end to kelp harvesting? We want to see sustainable kelp harvesting, which is a different thing.

Johann Lamont

It seems to be being implied that “sustainable” and “commercial” are contradictory terms, but they are not. Perhaps we should all have a mature conversation about what “sustainable” means and what developments we are prepared to accept in our remote and rural communities.

There will always be a trade-off. I want my nephews to have the opportunity to live in the communities in which they were born, and to have jobs that will keep them sustained and keep those communities viable and alive. I do not think that there is a contradiction between “sustainable” and “commercial”, nor do I think that members on different sides of the argument are in conflict with one another.

I hope that the importance of science and evidence will be respected—I think that the cabinet secretary has indicated that that will be the case—and that it is not accepted as fact that all proposals that will be commercial opportunities are a problem for communities. As someone who supports co-operative initiatives, I know that they must be commercially viable, and I know how successful they can be in sustaining the communities that we all care about.

Stewart Stevenson

I am as big a fan of kelp as anyone else, including Mark Ruskell, and I share all the environmental observations that have been made, which have considerable merit. That is what I said at stage 2, when the amendment that inserted new section 8A in the bill was agreed to. Three members voted in favour of that amendment and six members abstained. Why did the members concerned abstain? We did not do so because we thought that kelp is not worthy of protection. Everyone thought that it is worthy of protection, and we all continue to think that. We abstained because the process causes us considerable difficulties.

In an intervention on the cabinet secretary, Mark Ruskell said that we now need independent scientific advice. That is a fascinating way to legislate—to pass the law first, then look at the independent scientific advice. That is simply a case of doing things—I am not allowed to use the colloquial expression—back to front. I am speaking about the process, not the substance, which I am being persuaded, slightly reluctantly, to vote for, because that is the best way to protect kelp, which is what we all want.

Kelp is a valuable harvest. Lord Leverhulme’s opening of a herring processing and kelp harvesting farm at Northton in Harris 100 or so years ago gives an indication of the value therein.

I will bring my remarks to a conclusion, unusually by making a plea to the Presiding Officer, one of whose colleagues chairs the Conveners Group. What has happened here has all the hallmarks of what happens in the South African legislature and the United States legislature—I refer to what is called “earmarking”. I am talking about the introduction of a provision that was not part of the bill at stage 1, when we agreed to the general principles of the bill. I absolutely accept that what was done was within the rules of Parliament, but it might be useful for guidance to be given to committee conveners on the admissibility of the amendments that they select. It is their choice.

Andy Wightman

The amendments in question were deemed to be competent and within scope. I remind Stewart Stevenson that we are considering

“An Act of the Scottish Parliament ... to make provision about the management of the Scottish Crown Estate”,

among other things. By law, the kelp species that we are talking about are part of the land on which they grow—they are the property of the Crown—and the amendments that we are considering are designed to govern the management of a critical part of the Crown estate. They are wholly within the scope of the bill.

Stewart Stevenson

I will not engage with those comments directly, but Andy Wightman is correct—the amendments are perfectly valid. I am simply pointing out that, in this case, the lead committee has neither received, heard nor challenged a single piece of evidence on the subject, and even a member who is moving an amendment is saying that we now need independent scientific advice. That raises a wider issue about how we take forward such things.

Mark Ruskell

Of course we need independent scientific advice, but within the context of the legislation that we will pass today, which will put in a clear backstop—a golden rule—and set the context not only for the advice but for commercial development.

Stewart Stevenson

I simply conclude by—

John Scott

Will the member give way?

Stewart Stevenson

Yes—if the Presiding Officer allows it.

The Presiding Officer

Yes.

John Scott

I thank Stewart Stevenson for taking the intervention and I appreciate the indulgence of the Presiding Officer.

We have already heard the cabinet secretary admit that the licensing and regulatory regimes are not fit for purpose. Is Stewart Stevenson now suggesting, as I think he is—I tend to agree with him, because he is one of the fathers of the house, so to speak—that the processes of Parliament are being called into question because they have not allowed the matter to be properly debated and aired, or for evidence to be taken in Parliament? Are those things not, allegedly, part of the processes of Parliament and, if so, are they to be called into question, too?

Stewart Stevenson

Let me try to conclude, finally and for the third time. We should not push the boat out too far on the subject of our processes, but the approach in question is an unusual one that has sometimes led us into difficulties when we have taken it in the past and a committee has not had the opportunity to take evidence from all interested parties. I am absolutely certain that the ECCLR Committee would conclude that we should protect kelp and that we should legislate to do so.

Andy Wightman

Will the member give way?

Stewart Stevenson

I think that I have passed that point, but I will do so, if the Presiding Officer permits it.

The Presiding Officer

I call Andy Wightman.

Andy Wightman

The member will be aware of the Parliament’s standing orders. Rule 9.8.6 allows the sponsor of the bill—in this case, the Government—to move a motion to return to stage 2 for detailed consideration for as long as might be necessary. I am just challenging the idea that Parliament’s processes are not up to the kinds of developments that we see with the bill.

Stewart Stevenson

For the fourth time, I will try to finish. I think that what I am trying to address is a very simple matter: the committees of Parliament have not had the opportunity to consider in detail the importance of the issue, which causes me to say that we should have done this earlier. I hope that we will do that in the future.

I will vote for the amendments when we come to do so very shortly.

The Presiding Officer

Just for clarity, I note that there are no procedural questions for me to rule on. All the amendments were deemed to be admissible. The issue that has been raised today is for Parliament to consider.

I call the cabinet secretary, then Mark Ruskell to wind up.

Roseanna Cunningham

Thank you, Presiding Officer. You will be very grateful to hear that despite my legal background I have absolutely no appetite for extended discussions about parliamentary standing orders or anything connected thereto.

That said, I want to correct one thing: I do not recall saying at any point that the licensing regime is “not fit for purpose”: in fact, I said exactly the opposite. The issues that have been highlighted with regard to kelp harvesting have shown that we need to ask serious questions about all such forms of harvesting.

Johann Lamont made some very fair points. Kelp is already a growing industry, and the potential of farming, let alone harvesting, of wild kelp has not been fully explored in Scotland.

However, members need to be aware that there are currently five methods of harvesting kelp, only one of which has become controversial and would have required to be licensed if it were to continue. I am happy to share with members information on the differences between the five different methods, because it might help them to understand the issues.

For example, some of what is called hand harvesting is actually taking place at a fair scale. It could, in my view, be argued that members might want to consider licensing it. That is the kind of thing that I want us to look at in the seaweed harvesting review. I think that, although we have become rather more expert in seaweed harvesting than we were when we began the process, there is still a great deal to learn and understand about it.

16:15  



Some of the issues and concerns that have been raised today are valid, however the debate is being had, decisions have to be made and I have made it clear where the Government stands on those decisions.

The Presiding Officer

I call Mark Ruskell to wind up and to press or otherwise the amendments in his name.

Mark Ruskell

Sometimes in politics, we have moments at which we can make a change for good. They may be unexpected and they may appear to sit awkwardly in the legislative process, but to ignore them would be wrong. Parliament recently, in a very short time, passed a continuity bill that deals with a wide range of issues. There was limited time to take evidence and to scrutinise, but I believe that we came up with robust legislation. I am looking at Mr Russell and he is nodding his head.

On Johann Lamont’s point about whether all commercial interest is bad, I say that of course it is not. However, commercial interest and activity needs to sustain itself over generations: generations of her forebears and generations of young people such as are in the gallery today. It has to be sustainable and it has to be in the long-term interest. That is why it is important that the Government has launched the sector review, which will look not just at current licensing applications, but at other forms of harvesting and extraction. We have learned so much about kelp farming in the past few weeks—including the experience of the Faroese—in terms of developing a vibrant sector that can create jobs for generations to come, that will serve our pharmaceutical industry and our food sector, and which will grow jobs and increase growth in remote and vulnerable communities in the north-west.

We are at the point when we can take the decision, and I welcome the constructive discussions that I have had with the cabinet secretary over the past few weeks—especially about the sector review.

I also welcome the support that I have had in committee from Claudia Beamish and Alex Rowley, and the open-mindedness of members, including Finlay Carson. I welcome the work of John Finnie and Gail Ross, who have channelled the concerns from businesses in the west coast of Scotland into the committee and the chamber. I particularly welcome the work of Ailsa McLellan and the Ullapool sea savers, who are here today.

We are in a good place. There will be a sector review and there is a hard backstop in the bill. It is up to industry to innovate around that and to come up with the industry that is needed for the future.

Amendment 6, by agreement, withdrawn.

Amendments 7 and 8 not moved.

Amendment 19 moved—[Roseanna Cunningham]—and agreed to.

Section 13—Directions about rent and other charges

Amendment 20 moved—[Roseanna Cunningham]—and agreed to.

After section 13

The Presiding Officer

Group 7 is on community benefit requests. Amendment 42, in the name of Liam McArthur, is grouped with amendment 44.

Liam McArthur

As I said earlier, the bill should be about ensuring that island and coastal communities have more local control over and benefit from the current Crown estate assets in Scotland. At stage 2, I moved amendments that aimed to make that happen by empowering local authorities to determine how community benefit schemes are set and money raised and allocated.

I have taken on board some of the concerns that were raised by the cabinet secretary and committee members, including those relating to an oversight on my part that seemed to suggest that Orkney would be the sole beneficiary of the provisions in the amendments. I hope that amendments 42 and 44 will now secure support from across the chamber.

Over the past 40 years, local management and commercial extraction of marine resources have been achieved through formal arrangements such as works licensing under the Orkney and Zetland acts and agreements with the oil industry. Those arrangements have worked well and to local and national advantage. Our island authorities’ track record has been recognised, and it rests on the principle that local communities should be compensated for the disruption and inconvenience associated with development work. We see that in relation to terrestrial planning, albeit on a voluntary basis; and in the offshore sector, albeit on a voluntary and patchy basis. Fundamentally, however, communities that have to endure the burden of development, dislocation, risk and the exploitation of scarce resources must be involved in decision making about which developments happen and which do not. They should also determine how any related community benefit is agreed. As I stated during stage 2,

“much of what I have said sits comfortably with the Government’s commitments in its prospectus ‘Empowering Scotland’s Island Communities’.”—[Official Report, Environment, Climate Change and Land Reform Committee, 18 September 2018; c 36.]

Like the island authorities, I believe that that commitment needs to be in the bill.

I move amendment 42.

Andy Wightman

Amendment 42 seeks to introduce a regulation-making power for a community benefit requests scheme and says that that such a request must not be unreasonably refused. Again, that seeks to uphold the recommendation in paragraph 33 of the Smith commission’s report, which says:

“responsibility for the management of those assets will be further devolved to local authority areas”.

I very much support amendments 42 and 44 and the Greens will vote for them.

Claudia Beamish

When Liam McArthur sums up, will he clarify whether he has any thoughts on community benefit in parts of Scotland beyond the islands? Such areas do not apply, or are unable to apply, in relation to management of the seabed. Could they still get some community benefit from things that they might see in their environment or which might have some impact on that environment?

John Scott

Amendments 42 and 44 would place a duty on Scottish ministers to make provision for a community benefit requests scheme, if asked by a local authority. Similar amendments were lodged at stage 2 and were regarded as being unnecessary. Scottish ministers have already made a commitment that Scottish coastal communities will benefit from the net revenue from Crown estate marine assets. In addition, the Scottish Government already encourages developers to deliver community benefit voluntarily and has discussed and agreed with the Convention of Scottish Local Authorities how to deliver those benefits to coastal communities from the net revenue.

On a different but related point, one has to wonder how land-locked local authorities are not to be disadvantaged by such payments being made only to coastal authorities, but perhaps that is an issue for another day.

Roseanna Cunningham

The purpose of amendments 42 and 44 appears to be to create a process whereby particular local authorities can request from Scottish ministers permission to generate community benefit from marine development occurring within the relevant Scottish marine region in relation to Scottish Crown estate assets out to 12 nautical miles. However, that does not create a process for how those benefits are to be generated. I am of the view that amendments 42 and 44 are unnecessary. There is no need to include in legislation a right for a local authority to seek permission from Scottish ministers to set up such a scheme. A local authority can already implement a scheme of that nature without the permission of Scottish ministers. In addition, the Scottish Government has no powers to oblige developers to pay community benefits for such schemes, and there are examples of developers in Scotland putting local community benefit schemes in place voluntarily.

Against that background, we will resist amendment 42 and consequential amendment 44. First, there is no need to include in legislation a right to create a scheme, because local authorities can create such schemes themselves; and, secondly, there are a number of practical difficulties around how the amendments would work in practice. Claudia Beamish mentioned some of them.

As a result of the way that amendment 42 defines “relevant local authority”, it would have the effect of applying to only six local authorities: Argyll and Bute Council, Western Isles Council, Highland Council, North Ayrshire Council, Orkney Islands Council and Shetland Islands Council. All the other coastal local authorities would therefore be excluded. That might be an advance on Liam McArthur’s Orkney-specific proposal at stage 2, but it is still a rather odd formulation.

How amendment 42 would work in practice is unclear. It seeks to create a process whereby one of the six local authorities that I mentioned could request permission

“to generate community benefit from marine development ... within its relevant Scottish Marine Region from”

the foreshore

“to 12 nautical miles as defined by the Scottish Marine Regions Order 2015”,

but “marine development” is not defined, and the marine areas as defined in the Scottish Marine Regions Order 2015 do not correspond exactly with the local authority boundaries. As we have already discussed, some of the marine areas are shared between more than one local authority, but amendment 42 does not set out a mechanism for determining competing claims by different local authorities to generate community benefit from the same marine area.

A further technical concern about amendment 42 is that imposing on ministers a duty to make regulations that would be subject to the affirmative procedure is problematic as the regulations could be made only if a draft had already been approved by the Parliament.

I remain of the view that amendments 42 and 44 are not necessary. The Scottish ministers have already made a commitment to ensure that island and coastal communities will benefit from the net revenue from the Scottish Crown estate marine assets. We have had constructive discussions with COSLA and have agreed an interim mechanism for local authorities to receive a share of the net revenue out to 12 nautical miles. That local funding will not be hypothecated, but we would expect the local authorities to be transparent and accountable to their communities for how the money is spent.

Arrangements are being made to distribute the revenue to coastal councils later this year and we have agreed with COSLA that we will review the interim arrangements, including whether we can establish a closer link with the net revenue that is raised in a local authority area.

I ask Liam McArthur not to press amendment 42 and not to move amendment 44.

Liam McArthur

I thank all those who have contributed to the debate. First, I thank Andy Wightman. I thought that, having mentioned the Smith commission enough in my previous contributions, I would avoid doing so again, but he was not so inhibited. He is absolutely right that my amendment 42 honours the recommendations of the Smith commission.

I acknowledge the constructive engagement that Claudia Beamish has had with me on amendment 42. I think that the regulatory powers would enable some of the concerns that she expressed about other local authorities to be addressed. John Scott picked up on a similar issue and went on to insist that it is captured in relation to net benefits. If he is going to vote against amendment 42, I very much look forward to his support when we turn to the next group, on net benefits.

Both John Scott and the cabinet secretary mentioned the discussions with COSLA. I point out that, however they are going, there are still anxieties among the island authorities about the way in which the revenues will be distributed. To suggest that all is well and there are no concerns to be addressed is therefore, perhaps, a little naive.

On the basis of what I have heard this afternoon, it is probably best if I do not press amendment 42 and we return to the matter under the next group, on net benefits.

Amendment 42, by agreement, withdrawn.

After section 14

Amendment 21 moved—[Roseanna Cunningham].

Amendment 21A moved—[Mark Ruskell].

The Presiding Officer

The question is, that amendment 21A be agreed to. Are we agreed?

Members: No.

The Presiding Officer

There will be a division. This is the first division in the group, so we will have a one-minute division.

For

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
White, Sandra (Glasgow Kelvin) (SNP)
Wheelhouse, Paul (South Scotland) (SNP)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Sarwar, Anas (Glasgow) (Lab)
Russell, Michael (Argyll and Bute) (SNP)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
McNeill, Pauline (Glasgow) (Lab)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lochhead, Richard (Moray) (SNP)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harper, Emma (South Scotland) (SNP)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Campbell, Aileen (Clydesdale) (SNP)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

Abstentions

Whittle, Brian (South Scotland) (Con)
Wells, Annie (Glasgow) (Con)
Tomkins, Adam (Glasgow) (Con)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Scott, John (Ayr) (Con)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Mason, Tom (North East Scotland) (Con)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lindhurst, Gordon (Lothian) (Con)
Kerr, Liam (North East Scotland) (Con)
Harris, Alison (Central Scotland) (Con)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Golden, Maurice (West Scotland) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Corry, Maurice (West Scotland) (Con)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Ballantyne, Michelle (South Scotland) (Con)

The Presiding Officer

The result of the division is: For 89, Against 0, Abstentions 28.

Amendment 21A agreed to.

Amendment 21B moved—[Mark Ruskell].

16:30  



The Presiding Officer

The question is, that amendment 21B be agreed to. Are we agreed?

Members: No

The Presiding Officer

There will be a division. This will be a 30 second division.

For

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
White, Sandra (Glasgow Kelvin) (SNP)
Wheelhouse, Paul (South Scotland) (SNP)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Swinney, John (Perthshire North) (SNP)
Sturgeon, Nicola (Glasgow Southside) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Elaine (Central Scotland) (Lab)
Scott, Tavish (Shetland Islands) (LD)
Sarwar, Anas (Glasgow) (Lab)
Russell, Michael (Argyll and Bute) (SNP)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
McNeill, Pauline (Glasgow) (Lab)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lochhead, Richard (Moray) (SNP)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harper, Emma (South Scotland) (SNP)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Campbell, Aileen (Clydesdale) (SNP)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

Abstentions

Whittle, Brian (South Scotland) (Con)
Wells, Annie (Glasgow) (Con)
Tomkins, Adam (Glasgow) (Con)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Smith, Liz (Mid Scotland and Fife) (Con)
Simpson, Graham (Central Scotland) (Con)
Scott, John (Ayr) (Con)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Mason, Tom (North East Scotland) (Con)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lindhurst, Gordon (Lothian) (Con)
Kerr, Liam (North East Scotland) (Con)
Harris, Alison (Central Scotland) (Con)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Greene, Jamie (West Scotland) (Con)
Golden, Maurice (West Scotland) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Corry, Maurice (West Scotland) (Con)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Ballantyne, Michelle (South Scotland) (Con)

The Presiding Officer

The result of the division is: For 89, Against 0, Abstentions 28.

Amendment 21B agreed to

Amendment 21, as amended, agreed to.

After Section 25

The Presiding Officer

Group 8 is on a list of the Scottish Crown estate assets and liabilities. Amendment 3, in the name of John Scott, is grouped with amendment 5.

John Scott

Amendments 3 and 5 place a duty on Scottish ministers to maintain and publish a list of assets and make the list available for public inspection. Such a list would provide, at a glance, an understanding of what is owned by Scottish ministers and I hope that they will accept this opportunity to lead by example, given the expectation raised in the current land reform legislation that information on who owns what under private ownership should be easily accessible and public knowledge in Scotland. The amendments respond to recommendation 379 of the stage 1 report, which was that the Crown Estate Scotland should establish and maintain a list of assets and liabilities. Such a list, if published annually, would also provide an annual inventory, which would allow comparisons, year on year, of assets and liabilities, and would make the evolving shape of the Crown estate assets under the new obligations public and available for scrutiny. I hope that the amendments will be accepted by Parliament.

I move amendment 3.

Roseanna Cunningham

I thank Mr Scott for lodging these amendments and for raising the issue for debate. At stage 1, there was considerable interest in the assets and liabilities of the Scottish Crown estate and the amendments reflect some of the concerns that were expressed. In the stage 1 report, the Environment, Climate Change and Land Reform Committee recommended that

“Crown Estate Scotland establish and maintain a list of Crown Estate Scotland assets and the liabilities that attach to these.”

I certainly acknowledge the need to know who is the manager of any particular Scottish Crown estate asset. The information is needed to determine who is responsible for the asset, who can give permission to access the land and who can grant a lease. Those are legitimate questions.

At present, Crown Estate Scotland (Interim Management) maintains details of the assets that it manages, and the annual report and accounts will give a picture of the value of the assets by key sectors. The accounts also contain information on the liabilities of the organisation. Crown Estate Scotland (Interim Management) has an interactive map on its website showing indicative locations of assets under its control that have in place live agreements, including leases. It also undertakes condition surveys and valuations of buildings and other property as appropriate. Ministers can direct managers to maintain an asset register in addition to the requirements on managers regarding management plans and annual reports.

Collecting, managing and reporting information on assets and liabilities forms part of the business-as-usual approach that has been operating since devolution, although, of course, it respects that some information is commercially sensitive and needs to be treated as confidential.

John Scott

How readily available would the lists and inventories be? Would they be available publicly, at a glance? Could someone find them after three clicks of a mouse?

Roseanna Cunningham

I reassure Mr Scott that we are as concerned as he is that the public is able easily to find out what assets form part of the estate, what the categories of liabilities are and who is managing any Scottish Crown estate asset. Officials are in discussion with how the information on assets can be made more widely available; that is an active consideration.

I provide reassurance that there will be publicly available information on assets and liabilities, but I do not consider there to be a need to require that in legislation, and I ask Mr Scott not to press his amendments.

Amendment 3, by agreement, withdrawn.

Section 31—Grants for preparation for management changes

Amendment 22 moved—[Roseanna Cunningham]—and agreed to.

After Section 31

The Presiding Officer

Group 9 is on transfer of net revenues to relevant local authorities. Amendment 43, in the name of Liam McArthur, is grouped with amendment 45.

Liam McArthur

We have covered some of this ground before—I have moved amendments in relation to the devolution of management powers over Crown estate assets and in relation to the devolution of responsibility for determining community benefit.

The two amendments in this group follow a similar pattern in relation to net revenues, which were mentioned by John Scott and the cabinet secretary in relation to group 8. I did not think that they would necessarily be hugely controversial. The Scottish Government’s “Empowering Scotland’s Island Communities” prospectus says:

“Net income from activities within 12 nautical miles would be passed to individual Councils and each will be responsible for administering their own fund”.

In 2016, which was two years after the prospectus was published, the First Minister said:

“Not only will our island communities benefit from 100 per cent of the Crown Estate revenues that they raise, but they will have a greater say in how the assets of the Crown Estate are managed.”

That is uncontroversial—there is support for those aspirations across the chamber. The island authorities, not unreasonably, are looking for those specific commitments to be included in the bill. That is what amendments 43 and 45 seek to achieve. I look forward to the debate.

I move amendment 43.

John Scott

Amendments 43 and 45 would create a duty for Scottish ministers to

“make provision for a scheme to provide for the transfer of ... net revenue ... to a relevant local authority”

where that

“relates to marine development”

and

“other matters as the Scottish Ministers consider appropriate.”

The amendments are similar to amendments that were debated at stage 2 by the committee and the Government. We believe that they are unnecessary, as the Scottish Government has said. The Government has made commitments that Scottish coastal communities will benefit from the net revenue from the Scottish Crown estate marine assets. I believe the Government, notwithstanding Liam McArthur’s concerns about the believability of Government assurances.

The amendments would require that 100 per cent of net revenue from development of marine areas of Scottish Crown estate assets would be given to relevant local authorities. We simply do not agree with that. As I have said, no similar scheme to benefit landlocked local authorities has been suggested or provided for in the bill. Although I understand the ambitions behind Liam McArthur’s amendments, I regret that they are not entirely fair to other local authorities.

Andy Wightman

We support amendments 43 and 45. They further the commitments that were given by all parties in this Parliament in the Smith commission report, paragraph 33 of which says:

“responsibility for the management of those assets will be further devolved to local authority areas”.

Liam McArthur’s amendments would place on a statutory footing a long-standing promise that was made by the First Minister at a meeting of the convention of the Highlands and Islands in Kirkwall on 1 June 2015.

I am pleased that John Scott believes the commitments of the Scottish Government on this matter. I do, too—I have no doubt about the Scottish Government’s commitment to transfer the net revenues. However, we are passing a law today, and the current Government’s commitments might not last beyond the life of this particular Administration. A future Government—one that perhaps includes Mr Scott—might not want to transfer those revenues. The question today is whether this Parliament feels that those net revenues should properly be transferred to Scotland’s local authorities. Therefore, we support putting on a statutory footing the welcome commitment that has been made by the Scottish Government, which upholds the recommendations of the Smith commission, which were committed to by all parties.

Roseanna Cunningham

Scottish ministers have committed to providing for the benefit of coastal communities the net revenue that is generated, after all costs have been deducted, from Scottish Crown estate marine assets out to 12 nautical miles. Indeed, the Scottish Government and COSLA have agreed an interim formula-based approach to distribute the net revenue from Scottish Crown estate marine assets out to 12 nautical miles to each island and coastal local authority. I therefore see no need for legislation on this matter, given the commitment that has been given and the agreement with COSLA.

In addition, there are technical issues about the operability of amendment 43, and the amendment would cover only part of the agreement with COSLA. The amendment is applicable only to relevant local authorities, which are those that are listed in paragraphs 61 to 66 of the schedule to the Islands (Scotland) Act 2018, namely Shetland Islands Council, Orkney Islands Council, Western Isles Council, Highland Council, Argyll and Bute Council and North Ayrshire Council. It excludes all the other coastal local authorities.

Amendment 43 requires that a scheme should set out

“a process by which a relevant local authority is to receive 100% of net revenue, insofar as that revenue directly relates to marine development in its respective marine area, from Scottish Crown Estate assets from mean high water spring tides out to 12 nautical miles as defined by the Scottish Marine Regions Order 2015”.

The Scottish Marine Regions Order 2015 created 11 marine regions in Scotland, the boundaries of which are described in the order. They do not necessarily align with the boundaries of local authority areas in Scotland, as has been mentioned this afternoon. In my view, that creates a particular problem in the delivery of the effect of this amendment. In particular, the boundaries of Highland Council, Argyll and Bute Council and North Ayrshire Council do not correspond directly to any one particular Scottish marine region. Again, what is meant by revenue that “relates to marine development” is unclear, as that is not defined.

A further issue with amendment 43 is that imposing a duty on ministers to make regulations that are subject to the affirmative procedure is problematic, as the regulations can be made only if a draft is approved by the Parliament.

I also believe that amendment 43 and consequential amendment 45 are unnecessary, in the light of the Government’s commitment that coastal and island local authorities will benefit from the net revenue from Scottish Crown estate marine assets. That commitment is demonstrated by our agreement with COSLA. Moreover, as I have highlighted, it is not clear that amendment 43 will work as intended, as the marine areas that are set out in the 2015 order do not correspond to each of the local authority areas.

The amendment would also create a different procedure for the six councils compared with the other coastal local authorities that will benefit from the net revenue from neighbouring assets of the Scottish Crown estate out to 12 nautical miles, as currently agreed. As a result, the marine areas of each of the following local authorities are not properly defined: Argyll and Bute Council, Western Isles Council, Highland Council, North Ayrshire Council, Orkney Council and Shetland Council.

Amendment 43 creates difficulties, particularly where there is an overlap and more than one local authority area has its boundaries within a particular marine region, and where a marine region is within the boundaries of one of the six relevant local authorities as well as those of another local authority. The effect of the amendment is that a relevant local authority would be entitled to 100 per cent of the net revenue of marine development in that marine region to the detriment of the local authority that shares the marine region in which the revenue was generated. In particular, Highland Council shares the Moray Firth Scottish marine region with Moray Council and Aberdeenshire Council. It would be inappropriate for this amendment to result in all the Scottish Crown estate net revenue resulting from marine development in the Moray Firth marine region to automatically be transferred to Highland Council to the detriment of coastal communities in the Moray Council and Aberdeenshire Council areas.

In addition, Argyll and Bute Council and North Ayrshire Council share the Clyde Scottish marine region with other local authorities, including South Ayrshire Council and Inverclyde Council. It would be equally inappropriate for Argyll and Bute Council and North Ayrshire Council to receive 100 per cent of the net revenue resulting from marine development in the Clyde Scottish marine zone to the detriment of the other coastal communities in the South Ayrshire Council and Inverclyde Council areas. It also unclear how Argyll and Bute Council and North Ayrshire Council could both receive 100 per cent of the net revenue from marine development in a Scottish marine zone that lies within both local authority boundaries.

It is for those reasons that I do not support amendments 43 and 45 and I urge Mr McArthur not to press them. [Interruption.]

16:45  



Liam McArthur

I am being encouraged by Alex Neil to clarify what assets in Airdrie and Shotts will be protected as a result of these amendments.

I thank John Scott, Andy Wightman and the cabinet secretary for their contributions. Andy Wightman is absolutely right that it is not about whether we believe the Government; it is about legislating and ensuring that those assurances succeed any current Government.

I think that John Scott is on record as saying that he does not support the proposal that local authorities should receive 100 per cent of the net revenue. There is therefore immediately a question mark around how resilient the assurances that have been given by the cabinet secretary would be in the future. Orkney Islands Council has made clear that it sees the commitment as being about fairness and equitability, and about providing an incentive to encourage and promote marine activity in our respective waters.

Although I listened carefully to what the cabinet secretary had to say—she outlined a number of legitimate concerns around where net revenue would accrue—there remains a concern in Orkney and Shetland about that issue. The net revenue cannot accrue on the basis of some algorithmic concoction that the Scottish Government comes up with. Given the Smith commission recommendations, there is rightly an expectation that the net revenue accruing from the activity in the waters around Orkney should accrue to Orkney Islands Council and to the Orkney community.

Claudia Beamish

Given what the cabinet secretary has highlighted, does the member not agree that councils that are not in paragraphs 61 to 66 of the schedule to the Islands (Scotland) Act 2018 might be disadvantaged by his amendments? Those councils could well have areas looking out over offshore wind installations or be involved in some other way, and the amendment could make it hard to divide up the net revenue. Will the member consider that in deciding whether to press his amendment?

Liam McArthur

Spoiler alert: I think that I will withdraw the amendment, not least because of the protestations of my colleague from the north-east, Mike Rumbles, in response to the cabinet secretary's intimation about what is happening in the Moray Firth.

However, there is a real issue about what will happen beyond the first or second year and the approximation that is made of the revenues that will accrue to different local authorities. Something more specific is required, particularly in areas such as Orkney and Shetland, where there is no dubiety about where the benefit of the net revenue should accrue.

Andy Wightman

I note that the member intends to withdraw his amendment. He will be aware that, under rule 9.8.5C of the standing orders, the minister is able to lodge a motion without notice that the remaining proceedings of stage 3 be adjourned to a later date. That would allow the cabinet secretary, were she so minded, to remit to the stage 2 committee amendments on statutory provisions for net revenue transfers so that they could be sorted out and brought into the bill. The member might wish to pursue that option with the cabinet secretary.

Liam McArthur

I am grateful to Andy Wightman for that intervention—he will want to look at the video later to see the body language of the members sitting behind him as he suggested that.

I think there are concerns about how amendment 43 would apply, which I am prepared to accept. There is an opportunity for the cabinet secretary, if she so wishes, to give an undertaking along the lines that Andy Wightman has suggested.

What I am trying to put on the record is that because of the commitments that were given by the Government in its “Empowering Scotland’s Island Communities” and as recently as June 2018, there is now an expectation that 100 per cent of the net revenue accruing from the developments in the waters around Orkney, Shetland and other island and coastal communities will accrue to those communities. On that basis, and given the concerns that have been raised, I seek to withdraw amendment 43.

Amendment 43, by agreement, withdrawn.

Section 40—Regulations

Amendment 4 not moved.

Amendments 44, 45 and 5 not moved.

Section 43—Interpretation

Amendments 23 and 24 moved—[Roseanna Cunningham]—and agreed to.

The Presiding Officer

That concludes the amending stage of the bill.

As members might be aware, at this stage in the proceedings, I am required under standing orders to decide whether, in my view, any provision of the bill relates to a protected subject matter—that is, whether it modifies the franchise for Scottish parliamentary elections or the electoral system. My view is that no provision of the Scottish Crown Estate Bill relates to a protected subject matter. Therefore, my determination is that the bill does not require a supermajority to be passed at stage 3.

I will suspend the meeting for a few minutes to allow the minister and other members to take a short break before the stage 3 debate.

16:52 Meeting suspended.  



16:58 On resuming—  



Final debate on the Bill

Once they've debated the amendments, the MSPs discuss the final version of the Bill.

Video Thumbnail Preview PNG

Final debate transcript

The Deputy Presiding Officer (Christine Grahame)

The next item of business is a debate on motion S5M-14822, in the name of Roseanna Cunningham, on the Scottish Crown Estate Bill. I invite members who wish to speak to press their request-to-speak button now.

16:58  



The Cabinet Secretary for Environment, Climate Change and Land Reform (Roseanna Cunningham)

Today is an historic occasion, as this is the first time that the Parliament has ever legislated on the management of the Scottish Crown estate. It is, therefore, a landmark bill, which continues the process of the devolution of the Scottish Crown estate that started with the Smith commission and the Scotland Act 2016.

Until now, the management of the Crown estate has been governed by the Crown Estate Act 1961, which is a reflection of its time, predating the discovery of the North Sea oil fields and the development of aquaculture and, of course, offshore renewables. Administrative arrangements need to change with the times, however, and arrangements for the management of the Scottish Crown estate should reflect devolution. The bill enables local authorities, communities and harbour authorities to take on the management of Scottish Crown estate assets and to manage them in a way that benefits local communities within an overall national governance framework.

Our ambition is for the Scottish Crown estate to make a difference for the people of Scotland at both the local and the national level. The work of the Parliament today and during the course of the bill will help to deliver that ambition, ensuring that the management of the Scottish Crown estate has the statutory basis to contribute to the economic development, regeneration and social and environmental wellbeing of Scotland and, of course, to sustainable development in Scotland.

The net revenue from Crown estate assets will be paid into the Scottish consolidated fund, and the net revenue from areas out to 12 nautical miles will be distributed to coastal local authorities. It is, therefore, important that, overall, the estate is run in a way that protects and enhances the public finances rather than being a drain on them. It is also important to recognise that there are parts of the estate that cannot be expected to make money and other parts where a less commercial approach may be best to secure wider benefits.

The bill enshrines the accountability of the Crown Estate Scotland to the Parliament; modernises the statutory framework for management and assets; and creates new processes for further devolution of the Scottish Crown estate. For the first time, there will be a statutory requirement to prepare a national strategy for the Scottish Crown estate and a duty to act in the way that is best calculated to further the achievement of sustainable development in Scotland. By including new duties on sustainable development as well as wider socioeconomic and environmental factors, the bill requires managers of the Scottish Crown estate to contribute to multiple outcomes. Management of the Scottish Crown estate includes the management of sea-bed rights and a diverse portfolio that encompasses vibrant sectors that deliver economic and environmental benefits—such as the offshore renewables sector.

From my engagement with Crown Estate Scotland staff at Bell’s Brae, I am aware of their high standard of professionalism and their commitment to maintain and improve the value of the Scottish Crown estate. I have seen the great work that is being done in areas such as the environment, renewable energy, tourism, recreation and support for community development projects.

It will not have escaped colleagues’ notice that the issue of kelp harvesting has arisen during the progress of the bill and at points has appeared to almost overwhelm its original purposes. That has surfaced a range of issues concerning the regulation of current and proposed harvesting activity in the sector. The issues are complex, many and varied and require the gathering of further evidence to conclude how we should proceed in future. I remain of the view that the Scottish Crown Estate Bill is not the optimal place to control seaweed harvesting. However, the amendments that we have agreed to today provide a good foundation for better regulation of that activity in advance of further work to better understand the issues.

My announcement today of a review of the regulatory regime for all kelp harvesting activity in Scotland recognises that there is current interest in new types of seaweed harvesting in Scottish waters and that there may be more interest in future. I hope that all those who want to be part of that burgeoning industry will continue to engage with the Government and relevant authorities. I can advise that we will write to Marine Biopolymers Ltd today in respect of that aspect.

I express my special thanks and gratitude to the Crown estate stakeholder advisory group and members of the Environment, Climate Change and Land Reform Committee for their contributions, and to my officials for their engagement and work on all aspects of preparation of the bill. I also thank Crown Estate Scotland staff for their contribution to the process, and particularly for the advice and support given to my officials on aspects of the technical drafting of the bill.

I commend all the Crown Estate Scotland staff for their dedication in continuing the good management of the assets and for progressing opportunities for pilots of local management while the bill has progressed through Parliament. I am conscious of the uncertainty that a political process can bring to people’s day-to-day activities in their workplace. With the enactment of the bill, we can move beyond that uncertainty towards a clear future that is full of opportunity for the estate. I very much welcome the fact that the bill has been improved and strengthened as a result of the parliamentary process.

This is the start of a new era in the management of the Scottish Crown estate in which the assets are managed for the benefit of the people and communities of Scotland while protecting their value.

I move,

That the Parliament agrees that the Scottish Crown Estate Bill be passed.

17:03  



John Scott (Ayr) (Con)

I declare an interest as a farmer, and I refer members to my entry in the register of members’ interests for other interests.

I welcome the passage of the Scottish Crown Estate Bill, which follows on from a Smith commission recommendation and the Scotland Act 2016, which devolved the management of the Scottish Crown estate to the Scottish Parliament. The Crown estate in Scotland, which was originally part of the United Kingdom-wide Crown estate, has a wide range of assets, including rural estates and rights to naturally occurring gold and silver across Scotland, as well as moorings, ports and harbours, the sea bed out to 12 nautical miles and, interestingly, carbon dioxide storage out to 200 nautical miles. Therefore, we have had to consider how many different assets will be managed by the Scottish Government in future, and I hope that the bill will deliver properly on the different focus that the Government has set for managing those assets.

Previously, the sole purpose of the Crown estate was to deliver funding to the Scottish or UK treasury. The bill seeks to further devolve, where appropriate, responsibility for the management of the assets away from the Scottish Government to Crown estate managers and other bodies, such as local authorities harbour boards and community groups.

In addition, Crown estate managers, as well as seeking to enhance the value of the assets and to monitor and enhance the income from them, will be required to do so in a way that is best calculated to further the achievement of sustainable development in Scotland, and to contribute to promoting the improvement of economic development and regeneration, social wellbeing and environmental wellbeing. To me, that feels as though it will be a tall order for Crown estate managers. Having to enhance the income from the various assets, in addition to all the other new duties that will be placed on managers, will certainly, in my view, prove problematic and will likely deliver a much-reduced income stream to the Scottish Government; but we shall see.

I turn to another area of significant debate in the bill. Although I abstained on Mark Ruskell’s amendment 21A on protecting kelp beds on environmental grounds, I very much regret the way in which the prohibition of the harvesting of Laminaria hyperborea will be passed into law; indeed, it provokes real questions about the stage 2 process for considering amendments in any future bill. It now appears that significant announcements on, and alterations to, a bill can be considered and acted on by committees, Government and Parliament, without any formal evidence being heard by a bill committee. Stewart Stevenson highlighted that point.

Andy Wightman (Lothian) (Green)

The rules of Parliament allow for the introducer of a bill to move a motion without notice to return a bill to stage 2 for further consideration. There is nothing standing in the way of further consideration of those matters, apart from the decision of the Government on whether to utilise that power. Does the member agree?

John Scott

Yes; indeed, I raised the process with the appropriate bodies at the time. A bill would need to return to stage 1 in order for a committee to gather further evidence. That is what happened, perhaps 12 years ago—when Bill Aitken was the committee convener—when a justice bill on stalking had to go back to stage 1 after one of my constituents suggested an amendment. I am certain that the cabinet secretary will remember that happening, and possibly even Stewart Stevenson, too—we reverted to stage 1, took the information and then went back to stage 2. Thereafter, amendments were lodged and the stalking legislation, which is so worth while, came into being.

However, when I looked into the matter, I was told that, because the Scottish Crown Estate Bill had completed the stage 2 process and had left the committee, so to speak, the process that Andy Wightman and I have described could not be activated. I thank Andy Wightman for his intervention—he is absolutely correct—but I was made aware that that process was not appropriate in this case.

I have lost my place in my speech. Real questions are provoked about the stage 2 process of considering amendments—yes I have said that already.

More awkward still, in this case, the developmental scientific work, which would have built on the age-old industry of kelp harvesting, had been supported by Government agencies, including Marine Scotland, and distinguished universities over the past eight years, with every regulatory hoop being jumped through and every piece of Government advice being acted on. Nevertheless, the significant regulatory process, which Marine Biopolymers Ltd adhered to throughout, will perhaps now not be completed, although perhaps one should take succour from what the cabinet secretary has said today.

In addition, other science-based businesses might now be deterred from investing in Scotland, knowing that a regulatory developmental process for product development that is supported by Government agencies can be overturned, almost whimsically, by Parliament.

It is difficult enough for our development agencies to persuade would-be investors to invest in Scotland and, today, it just became a lot more difficult. However, I welcomed Johann Lamont’s supportive speech and the reality check that it provided. In particular, I share her interest in, and have long worked towards, bringing jobs and support to our remote and fragile coastal communities. The proposal would have brought—and still might bring—40 jobs to Mallaig.

I also welcomed Stewart Stevenson’s speech and agree with him that there has been a failure of process thus far, in which Marine Biopolymers Ltd has been collateral damage. However, I take succour from the cabinet secretary’s announcement of a root-and-branch review. I hope that the door might not be completely closed on the work of MBL. I note that, as part of the transformational change that the cabinet secretary hopes to bring about, she will look to pilot schemes to take forward scientifically based developmental projects. I am pleased that the cabinet secretary will today write to MBL, perhaps in that regard but, if not, at least positively, I hope.

There are many good things about the bill. The continuing management of the four rural estates by Crown Estate Scotland has been welcomed by NFU Scotland and the Scottish Tenant Farmers Association, as well as by tenants.

I am pleased to have been part of the work on the bill and I hope that it turns out as we all hope it will.

17:11  



Claudia Beamish (South Scotland) (Lab)

The Crown estate assets cover a diverse range of land, foreshore, sea bed, rights and property, as the cabinet secretary said. Scottish Labour welcomes the successful devolution of the management of responsibilities and revenues to Scotland, as called for by the Smith commission.

The Crown estate is said to date back as far as 1066—Andy Wightman might correct me on that—and many of the assets are steeped in Scottish cultural significance and history. Today’s meaningful legislation, which transfers the management and revenue of the assets to the hands of managers around Scotland, is positive and empowering.

I thank the Convention of Scottish Local Authorities for its recent letter in support of the Scottish Crown Estate Bill, which maximises local authority empowerment. It is a move in the direction of democratic empowerment and greater transparency. I look forward to the opportunities for community empowerment during the process of double devolution.

I am reassured that local authorities will be able to act as gatekeepers for consideration of community group management proposals. Decentralising management will enable communities and local authorities to realise their ambitions for the assets and enjoy the social and economic—as well as environmental—benefits that they can deliver. Greater consideration of local needs and the accrual of revenue to flow back into the community will go a long way to empower, and improve the resilience of, our rural and coastal communities.

With other members, I have long fought for sustainable development to underpin everything that this Parliament achieves. I am pleased that that ambition has been emphasised in section 7, as amended by the cabinet secretary’s amendment 17, which determines the principles by which managers must act. John Scott and I will have to agree to differ on that.

At stage 2, we discussed how best to achieve that, and I thank the cabinet secretary for working with Mark Ruskell and me to come to this very good solution. The manner by which many Crown estate assets are managed could have enormous repercussions for our natural world, so setting out sustainability so distinctly at the core of managers’ decision making is welcome.

The issue of kelp has been the most—perhaps the only—contentious part of the bill. I welcome the fact that amendment 21 was agreed to, and I welcome the cabinet secretary’s commitment to a complete review of the regulatory regime for kelp harvesting activity. I recognise that there are a number of categories and intricacies, and I hope that the review will act as a pathway to a robust framework for all kelp activities that is rooted in sustainability. I assure John Scott that there is nothing whimsical about Scottish Labour’s support for Mark Ruskell’s amendment 21A. I am delighted that it was agreed to. It is right that this is part of the framework within which the review is set.

Kelp forests are priority marine features, which have an enormous importance in our marine ecosystem, and any practice that prohibits regrowth or reproduction—whether it is fishing, farming or harvesting—is now out of the question. The Parliament has agreed time and again that sustainability is an absolute. To reassure Johann Lamont, who is no longer here, I say that it makes business sense but it also makes sense for the sake of our environment and our climate change ambition. At a time when our seas are under pressure from climate change, which is at the forefront of our minds with the Climate Change (Emissions Reduction Targets) (Scotland) Bill going forward, any new industry must be guaranteed in its sustainability.

We are still at a frustratingly early stage of considering the benefits of blue carbon sequestration, but we know enough to understand that it will be important to have a helping hand in tackling climate change and that that should be enforced, not diminished.

We know that coastal erosion and sea-level rises will be an increasingly greater threat to communities and infrastructure by the sea, and that kelp is a natural barrier to the effects of storm damage. We also know that kelp forests provide an important feeding ground for some of our most endangered, rare seabirds, which are disappearing at a devastating rate.

We know that our fishing industry, and other industries such as marine tourism, rely on kelp forests to play host to juvenile fish and to replenish the stocks and keep the industry sustainable.

More so than land conservation issues, marine protection can often fall foul of an attitude of out of sight, out of mind. Healthy ecosystems affect us all but especially coastal communities, who are most vulnerable to the effects of climate change. Those risks may be harder to grasp than the positive idea of a new multimillion pound industry, but they are vitally important as a setting for the future.

Labour supports the bill and what it sets out to do. It is an appropriate delivery of the Smith commission recommendation and it provides a framework for more progressive management of the Crown estate assets for the future of us all in Scotland.

17:17  



Andy Wightman (Lothian) (Green)

I agree with the cabinet secretary that this is a historic occasion. However, Scotland’s Crown estate goes back further than 1066—it has its origins in the ninth century, when Scotland was a unified kingdom. The western isles were not added until 1266, and the northern isles, with their distinctive traditions in these matters, were added in 1472.

It has been a long road to the bill. I remember a late-night taxi ride from Glasgow to Edinburgh some years ago in the company of Henry McLeish, the minister who was in charge of steering the Scotland Act 1998 on to the statute book. He told me of the frustrations of trying to secure devolution of the Crown estate, which was a task that he had to abandon at that time.

It is worth remembering why, in 1999, the Parliament should have gained full control over the property rights, revenues and management of the Crown. Those historic property rights—the foreshore, gold and silver, and the sea bed—are all defined by Scots law. Other Crown property rights that are not part of the Crown estate—including bona vacantia, ultima haeres and treasure trove—are also defined by Scots law and are to this day administered by the Crown Office in Edinburgh, where the Lord Advocate also upholds the common-law rights under the guardianship of the Crown over the foreshore.

In 1833, management of the assets that later comprised the Crown estate were transferred to London from Edinburgh. Importantly and significantly, they did not form part of the civil list that had been established in 1760 through the surrender of the English Crown revenues.

Thus, these historic rights remain constitutionally, legally and politically distinctive, as they are the rights of the Scottish Crown defined by Scots law that should have formed part of the Scotland Act 1998.

Some years later, it became clear that the Crown Estate Commissioners, whose lack of transparency and malign influence as a body corporate has blighted much of rural and marine Scotland, had secured the support of the palace and the Treasury to block any reform. Therefore, although the property rights were devolved in 1999, the revenues were not.

I want to put on record my thanks to Scotland’s local authorities, whose 2006 Crown estate review group report did so much to prompt this debate, as did the inquiry of the House of Commons Treasury Committee and the Scottish Affairs Committee.

In 2014, the Smith commission eventually recommended that management and revenues be devolved and that management should be further devolved to Scotland's local authorities. Despite UK Government guarantees that the Smith commission recommendation would be implemented in full, legislative competence for the revenues of the Crown estate has not been devolved.

The Scottish Crown Estate Bill is not the bill that the Greens would have wished to see. It is predicated on a flawed devolution settlement and is based on the assumption that the Crown estate is some kind of coherent suite of assets that, by law, must be maintained as an estate in land on behalf of the Crown.

The Crown estate is a feudal relic. It is an ad hoc assembly of rights that includes everything from gold and silver to a lock-up garage in the new town of Edinburgh and the island of Rockall. As a Parliament, our goal should be to sweep away such an anachronism and not to perpetuate it within a framework of complicated management and delegation powers. The Crown estate is also a colonial relic. Rockall was the last act of colonialism by the UK, which proceeded on the basis of a royal warrant that was modelled on that used by Captain Cook to steal Australia.

Amendments to that effect that I lodged at stages 2 and 3 were ruled out of scope. They included amendments on the repeal of the Royal Mines Act 1424—the oldest Scottish statute that is still in force—which reserved naturally occurring gold and silver to the Crown and is the origin of its rights. It is perfectly within the competence of the Parliament to repeal that act.

This debate should remind us that there is unfinished business. As I hinted during our consideration of the stage 3 amendments, we need to legislate to modernise the law of the foreshore and the sea bed. A report on the issue that the Scottish Law Commission published in 2003 sits on the shelf gathering dust. Had the draft bill that that report contained been enacted, we would by now have a sea, shore and inland waters (Scotland) act, which would have enshrined a statutory right to, among other things, make sandcastles, beachcomb, sunbathe and have picnics on the shore and foreshore. It would have given crofters the statutory right to gather kelp from the foreshore where that was in their crofting lease and would have put the ownership of the sea bed and foreshore on a statutory footing. All of that can yet happen.

Meanwhile, we will vote for the modest reforms that are outlined in the Scottish Crown Estate Bill.

17:21  



Tavish Scott (Shetland Islands) (LD)

I thank the cabinet secretary and the Government for introducing the bill. Andy Wightman mentioned what the late John Smith used to call “unfinished business”. I am with Andy Wightman on this—I am at the radical end of my lot on such issues. I would have abolished the Crown estate outright, but we did not get that chance. Reform is reform, and some reform is better than no reform.

I dug out the Official Report of a members’ business debate from 2007—I am grateful to Stewart Stevenson for reminding me of this—in which Alasdair Allan, Liam McArthur, Jamie McGrigor and Rob Gibson were among those members who spoke, and which Stewart Stevenson, as the then Minister for Transport, Infrastructure and Climate Change, wound up on behalf of the Government. In that debate, I suggested that we might need to rock the boat. In his wind-up, Mr Stevenson said:

“I say to Mr Scott that, if necessary, we will rock the boat.”—[Official Report, 1 November 2007; c 3063.]

I suppose that we have not rocked it far enough, but we have done some rocking. I will stop the analogy there, before it gets lost in itself, or sunk.

I have two basic points to make. The Smith commission process allowed us to look, on a cross-party basis, at areas that we knew needed to be addressed. We could have gone a lot further on the Crown estate and, for some of us, it would have been very splendid to have done that. However, we made a proposal, on a cross-party basis, that the Government has begun to give effect to.

There is more to be done when it comes to net proceeds. I will be interested to see what the definition of “net” as opposed to “gross” proceeds is. There will undoubtedly continue to be discussions on how the revenues will be delivered.

At home in Shetland, the process is under way of establishing a marine pilot scheme involving Shetland Islands Council and the Crown Estate Scotland body on the future of Sullum Voe, which is an area that has not been available for a wide range of marine uses because of the presence of the oil and gas industry since the Sullum Voe terminal opened back in the late 1970s. That is potentially a very exciting development for salmon farming, mussel farming, inshore fisheries and various other areas. That is positive, and we will look to see what outcomes come from that.

I am grateful for the measures on trust ports, in which I have a direct interest as a former chairman of what was then Lerwick Harbour Trust. Fundamentally, the trust port model is the best financial model that I can think of in the public system today, in that a trust port must be run on a commercial basis but all the money that is made must be reinvested in its facilities. I commend that financial model to Governments of any persuasion across a number of areas, because it allows a proper commercial focus to be maintained on what needs to happen to serve the customer—in the case of a port, the people who use quays and need services—while retaining the profits in the organisation to invest for the future. That seems powerful and appropriate.

I just want to make one remark about the debate that we had on kelp farming. It strikes me that regulation sits underneath legislation in order to allow for an appropriate assessment of any process, whether—and Johann Lamont made this point earlier—it is defined as industrial or not. I do not think that we got that issue right today. As John Scott rightly said, it is not really appropriate to start hauling things back to committee at stage 3. What should have happened with such a serious issue is that it should have been properly assessed much earlier and taken forward on that basis. I hope that Parliament will reflect on that for the future, because what happened today was not our finest moment as far as passing primary legislation is concerned.

When she retired last Friday after 44 years with Lerwick Port Authority, Sandra Laurenson, whom I mentioned earlier, gave some advice to those who will serve in future. She said:

“It is about attracting the different”

customers

“to come and locate themselves in our port, because the port is nothing without the customer.”

Now and again, we in politics should remember such useful comments when passing this kind of primary legislation.

The Deputy Presiding Officer

We move to the open debate. I can give speakers five minutes each.

17:26  



Stewart Stevenson (Banffshire and Buchan Coast) (SNP)

The cabinet secretary has said that this is the first time that we have legislated on the Crown Estate. I am sure that that is true, but it is certainly not the first time that we have debated the issue. As Tavish Scott has just reminded us, he had a members’ business debate on the matter on 1 November 2007, as had David Stewart on 18 April 2012. There will be other instances—I have the 2012 debate on file, simply because I happened to be the minister who responded to it. This is therefore not a subject that we have not debated or discussed before on the floor of the chamber or in the corridors of Parliament.

Andy Wightman took us back to the 900s in his speech. I had not realised that the matter went quite that far back; I found the Auditor of the Exchequer in Scotland, which was established as a court in the 1500s to look after what is now the Crown estate. There is a very long history to this.

With regard to the bill, which we are likely to pass soon, one section that has not attracted any significant amendment—it was amended a little bit at stage 2—is section 11, which sets out the duty to obtain market value. It picks up existing provisions in saying:

“The manager of a Scottish Crown Estate asset must not make any of the following transactions ... for consideration of less than market value”

but goes on to qualify that by making it clear that a manager can consider less than market value if they are

“satisfied that the relevant transaction is likely to contribute to the promotion or the improvement in Scotland of ... economic development, ... regeneration, ... social wellbeing, ... environmental wellbeing, ... sustainable development.”

Frankly, that is a breakthrough provision, because it recognises that these assets, which we are managing or allowing others to manage, should be managed for the common good, not simply to deliver an economic asset that flows into the structures of government at its various levels. I am particularly pleased with that section of the bill, although I would also highlight the duty in section 7 to maintain and enhance value.

The Crown Estate has a long history. I have been here a fair while—although not as long as everybody; John Scott, who is sitting looking around the chamber, was here before me, as was Tavish Scott—but I do not think that we can really say that in the Parliament’s earlier days the Crown Estate engaged with the members of this place to very useful purpose. In a long-standing constituency case, I had to persuade it to do something about a harbour at Crovie. It took something like five or six years before we finally concluded that that matter was actually its responsibility—and a good deal longer before it actually did anything about it.

If anything, the Crown Estate was passively malign or passively neglectful. It was slightly better than other people—

John Scott

Will the member take an intervention?

Stewart Stevenson

I will, if the Presiding Officer allows me time.

John Scott

I object to the member’s use of the word “malign”. I objected to Mr Wightman’s use of the word, too, when he described the Crown estate managers hitherto, who were doing their jobs as they best saw fit and within the confines of the law. I know many of these people directly—I declare that interest—and they are men and women of honour. I particularly object to the use of the word “malign” in that regard and in respect of those individuals.

I am sorry to be awkward about it again, but I have already raised the point with Mr Wightman and I am annoyed that I need to raise it again.

Stewart Stevenson

Mr Scott is perfectly entitled to make the point. However, I was pointing at the organisation, rather than the individuals, with whom I have always had the best of relationships; I have felt, as Mr Scott does, that as individuals they were doing their best. The framework that constrained them did not allow them to do anything other, in many instances, than to act in a way that one could describe as malign. However, let us not fall out about a single word—it is simply not worth the hassle.

There were private landowners around Scotland who were much worse. We used to go on holiday to Sutherland and the Vesteys, who were domiciled in Argentina, never paid a penny in tax in decades and were much more adverse in the way that they dealt with things.

I realise that I must conclude. The bill is part of returning power to our communities. In David Stewart’s debate in April 2012, we all talked about Peter Peacock and Community Land Scotland, and of transfers that were made. This is part of a process of restoring to the people of Scotland some of the assets that are rightly theirs and the control over them. We have not completed the journey, but the bill is a useful and helpful start.

17:31  



Edward Mountain (Highlands and Islands) (Con)

Before I begin, I draw members’ attention to my register of interests, in particular with regard to farming.

Today’s stage 3 debate on the Scottish Crown Estate Bill is another important step in realising the recommendations of the Smith commission. I have listened to the comments about the Crown estate and I have listened to some of the tenants on the Crown estate, especially agricultural tenants, who seem to be perfectly happy with the way that things were run in the past; they look forward to that continuing.

I am pleased that, at every stage of the bill’s passage through the Parliament, much of the debate has focused on enabling more local control of assets by local authorities—in other words, devolution. I am a strong supporter of more local control and I am pleased that there are provisions in the bill that will enable the management of some Crown estate assets to be passed beyond local authorities. However, I am cautious about too much double devolution, which allows the management of what, I believe, are national assets to such a local level that the national benefits of the assets could be lost. For example, those who live in land-locked local authority areas, such as East Renfrewshire, North Lanarkshire and South Lanarkshire, could—but should not—lose out on the benefits of having a say in the management of Crown estate assets such as the sea bed, just because they do not have a coastline. After all, the sea bed is an asset that benefits all users, not just the islands and coastal authorities. Therefore, we must remember that the Crown estate assets are national assets and, as such, the Scottish Government has a duty to ensure that the assets benefit Scotland as a whole.

The balanced approach that has been taken with the bill, which, with one hand, means more local control and, with the other hand, ensures that Scotland’s national assets are managed in the national interest, should be welcomed. I have concerns on the potential selling off of assets. The last thing that we need to see is a complete break-up of the Crown estate land in Scotland. If assets are disposed of, the Government should consult on and agree with the Parliament how that should be done. It has singularly failed to do that with our forests, in respect of which it has allowed much of the land to be sold off and not replaced, although that was a requisite of Parliament’s consent to the sale of the forests.

The Scottish Conservatives will therefore be watching the Scottish Government very carefully and expect the Government to publish its strategic plan, which should include robust guidance to ensure that the Crown estate does not become too fragmented.

Turning to farming, I would strongly advise the Government to consider how best to manage the assets. They must not be fragmented and new tenants and young farmers must be encouraged into Scottish agriculture. There are many young farmers across Scotland who are desperate for tenancies. The Scottish Government should not let them down by selling off farming assets, but should create more opportunities. The Scottish Government needs to learn the lessons of the sale of Auchenhalrig farm, which removed rather than created new opportunities for young farmers.

I will vote in favour of the motion on the Scottish Crown Estate Bill, as it turns another recommendation of the Smith commission into reality. However, I conclude with a note of caution: with the passing of the bill, the Scottish Government is getting control of some very important assets and I urge the Government always to think twice about selling them.

17:35  



Gillian Martin (Aberdeenshire East) (SNP)

I took over the convenership of the Environment, Climate Change and Land Reform Committee after its stage 1 deliberations on the Scottish Crown Estate Bill and was plunged straight in, as stage 2 consideration was on the agenda. As we all know, the devolution of the management and funds of the Crown Estate is one positive result of the Smith commission that will provide scope in particular for coastal rural communities to have more say over benefits from the land in terms of economic development, regeneration, social wellbeing, environmental wellbeing and sustainable development.

I commend the committee and the bill team in particular for the way in which the stage 1 evidence process was managed. Thorough evidence sessions were held with a wide variety of stakeholders and their evidence helped to make the bill stronger. Feedback from the stakeholder advisory group was extremely positive on how the committee and the bill team had operated, and I echo the cabinet secretary’s remarks on that. I thank Graeme Dey, the convener at the time, for steering that course, with the assistance of the committee clerks.

I want to say something about the issue that dominated the process on the day that the committee considered the bill at stage 2: the harvesting of kelp. I tried to intervene many times during the debate on the amendment on kelp, but no member accepted my interventions. I will use my time now to make the points that I would have made during that debate, because the issue caused me considerable discomfort as a new convener as well as a member of the Scottish Parliament.

I think that a lot of people do not realise that committee members were being asked to vote on an issue that had not come up in the evidence sessions in the committee’s stage 1 deliberations on the bill, which is, in essence, purely about the management of the Crown estate. It never looks good for anyone in our responsible position to make a judgment based on no evidence or, at best, anecdotal evidence. That was the basis on which I abstained in the vote on the amendment on kelp at stage 2.

The stage 1 report was thorough, but when I searched it I found no use of the word “kelp”. Marine horticulture issues are not simple; no natural environment issues are simple—as I am finding out by stealth—and I had and still have many questions that I would like answered around the kelp issue. Getting hundreds of Twitter messages or 38 Degrees emails on the issue demonstrates public engagement and passion, but that is no substitute for evidence gathering from scientists and stakeholders who know the subject intimately. I had questions on the methods of harvesting and on health and safety. Like Johann Lamont, I had a considerable number of important questions about the coastal rural economy. I thought that her speech was excellent in bringing that aspect to the debate.

We should all be very careful about voting on anything on which we have not heard on-the-record evidence. Unintended consequences can be identified only through scrupulous evidence taking, which is what the public expect from us. Stewart Stevenson was right in what he said and I offer him a colloquial term that reflects his description of the process and which the Presiding Officer would probably let him away with: heilster-gowdie.

I would be very uncomfortable about voting on a subject into which I have not had the opportunity to do a detailed inquiry, despite my efforts to do post-stage 2 investigations of my own. I am therefore pleased and relieved that the Government has committed to doing its own wide-ranging consultation on the issue. Perhaps we can then look at a system that protects species and habitats but does not cut off rural Scotland from the current and future economic, health and social opportunities of sourcing food, medicines, biopolymers and chemicals that are open to other northern countries, such as Iceland and the Faroe Islands.

Kelp can be the source of cattle feed that can reduce methane emissions, and we all want something that does that; it can be the source of biopolymers that can replace the plastic packaging that currently blights our environment; and it can be the source of pharmaceuticals that could provide cures or relief for multiple ailments and diseases. We need to take a rounded, evidence-based approach to the matter outside a bill that was not designed to carry that level of detail on an area that goes well beyond the Crown estate.

I did not come to this Parliament to abstain. I cannot stand abstaining. It is not in my nature. I came here to listen, question, deliberate and decide. The commitment on the Government consultation allows me to come off the uncomfortable position of the fence in the knowledge that we will move forward with all the evidence at our fingertips. That is hugely important as it means that the right decisions can be made with no negative unintended consequences for the marine environment, but also for the people who depend on that environment for their wellbeing and livelihoods and their communities’ very existence. For me, that is what the devolution of the management of the Crown estate is about.

The Deputy Presiding Officer

I will not ask whether that was an unparliamentary phrase. I am sure that I will find out at some point.

We move to the closing speeches. I call Mark Ruskell to close for the Greens. You have three minutes.

17:40  



Mark Ruskell (Mid Scotland and Fife) (Green)

We have reached a good point with the bill. We have not rocked the boat to the point of sinking, as, perhaps, Tavish Scott and Andy Wightman would like us to do. It goes some way towards delivering on the Smith commission recommendations—not the whole way, but the spirit of the Smith commission is there, and l look forward to further devolution, to democratically elected councils, of the rewards and responsibilities of Crown estate management.

We have had some debate on sustainable development and the important duty that will now be in the act, but too many members, including Mr Scott, see the matter as a trade-off between the economy and social and environmental objectives. To do that is to misunderstand what sustainable development is about: it is about locking in win-wins for future generations. Perhaps we, in this Parliament, need something like the Well-being of Future Generations (Wales) Act 2015 in order to ensure that sustainable development thinking runs through every piece of legislation that we pass.

It is important that, as we develop the economic opportunities that grow from use of our sea bed, sustainability is at their heart. We cannot afford to repeat the mistakes that were made in the growth of the salmon farming industry, which have been made during the life of the Parliament. Committees failed to scrutinise the matter and we kept making the mistakes over and over again, thereby compounding the environmental impact, without taking the action that was needed.

New sectors such as industrial kelp harvesting need to be fully understood and planned for. That is why the approach that the cabinet secretary is taking, through a review of the sector, is important. It will help to set the vision that will ultimately deliver the certainty that businesses need in order that they can choose the right pathway to commercial success, but that will be done with a backstop that is now in the bill—the backstop of sustainability.

Recently I met, with Gillian Martin, a group of Faroese kelp farmers. They represent a rapidly expanding industry that is scalable, unlike mechanical harvesting of kelp. Farmed kelp can produce 10 times the levels of useable sugars and proteins per hectare that farmed soya produces. That should give us a sense of the economic opportunity, but only if we learn the lessons of the past and set the sustainability bar high for the industry.

I pay tribute to the communities whose voices have been heard loud and clear on the issue, and to the Scottish Parliament information centre, which was commissioned by the committee to produce briefings and materials on the issue for members.

From primary schools to professors, from divers to David Attenborough, from the shellfish sector to the whitefish sector, concerns were expressed. We have remarkable people: scientists who have galvanised their arguments intelligently and articulately, and we thank them for that. The Government will now need to have many more discussions with a wide range of interests. I look forward to the outcome of the review.

17:43  



Alex Rowley (Mid Scotland and Fife) (Lab)

I speak today as a former member of the Environment, Climate Change and Land Reform Committee, and I record how much I enjoyed working with members of that committee on the bill and other topics, and how much I appreciate the work of the clerks, the advice that the researchers gave us and, which is important, the input of the people who gave up their time to provide evidence to the committee as we took the bill through stages 1 and 2.

The cabinet secretary rightly said that this is an historic occasion of further devolution of powers to Scotland. I have always believed that, where there is a clear case for further powers to be devolved to this Parliament in Scotland’s interests, we should all support that happening. Andy Wightman said that the reforms are “modest”, and Tavish Scott agreed with that, but they are a good start. Let us see where we go as we understand more about the opportunities that will come about through devolution of the Crown estate.

I also want to pick up on Tavish Scott’s point about the retirement of the chief executive of Lerwick Port Authority, Sandra Laurenson. As Tavish Scott knows, I spent many a year up in Lerwick and Bressay and I know of the good work that Sandra has done over all those years. I join him in congratulating her on being the first port authority master in the country and in wishing her success with whatever she goes on to do next.

When we speak about assets of the Crown estate, it is important to remember the diversity and location of the assets, which range from instantly recognisable buildings and landmarks to farmland, coastline and wilderness environments. Clearly, good management is essential for effective management of all of those parts of the Crown estate, but it is important that their value is seen not only in the context of commercial gain. I am therefore pleased that the bill sets out to achieve that. It does so by stating not only that the powers and duties of managers should

“maintain and seek to enhance”,

not just the asset’s commercial value and the income that arises from it but, crucially, that

“the manager may do so in a way that contributes to the promotion or the improvement”

of economic development, regeneration, social wellbeing, environmental wellbeing and—which is important—sustainable development.

I want to speak about a couple of those assets, the first being tenant farmers. Edward Mountain said that tenant farmers are quite happy and that we should not look to change anything. In the evidence that we took from tenant farmers it was clear that the physical farm buildings and houses range in quality, and that there is a need to empower farmers more. They were clear that they do not expect the local authority to start running their farms, but I hope that we will be able to consider how tenant farmers can have a stronger voice and be better able to make representations in order that they can improve the properties that they occupy. However, I also take on board the point that Edward Mountain made about encouraging more young farmers. I agree entirely about that.

I voted for the amendment on kelp at stage 2 because, for me, the issue is straightforward. We said that kelp harvesting needs to be sustainable: why would one not want it to be sustainable? I have done much more reading and understood a lot more about kelp harvesting since stage 2, and I have no regrets about voting for the amendment. I welcome the cabinet secretary’s announcement today of a further review of kelp harvesting opportunities.

The Deputy Presiding Officer

You must conclude.

Alex Rowley

I close by saying that we have done a great deal of work and that I welcome the bill as it will be passed today.

The Deputy Presiding Officer

Before I call Finlay Carson, we will have a brief pause while we ring the division bell.

17:49  



Finlay Carson (Galloway and West Dumfries) (Con)

I appreciate that, Presiding Officer.

I am pleased to speak in tonight’s debate as the Scottish Crown Estate Bill nears its final stages, having spoken at the stage 1 debate and as a member of the Environment, Climate Change and Land Reform Committee, which heard extensive evidence on the bill.

The Scottish Conservatives have always supported the Scottish Crown Estate Bill in principle, and we believe that many of the changes that have been made throughout the legislative process have strengthened the bill and made it better.

Following on from the Smith commission recommendations and the Scotland Act 2016, which devolved management of the Crown estate to the Scottish Parliament, the Scottish Crown Estate Bill sets the framework for long-term management of the Crown Estate in Scotland. The bill identifies who can become a manager of a Crown estate asset, how its management can be devolved and what the remit of new managers could be.

I agree that local authorities, including the islands councils, might be well placed to take on management of assets, and I recognise that further devolution to local authorities is a significant recommendation of the Smith commission. However, given the right support, smaller community groups might be more appropriate bodies that could more successfully take on management of the assets. I do not believe that there should be an assumption that local authorities are, by default, the most suitable organisations, so I am pleased that that will not be the case, when the bill is passed tonight.

I believe in community empowerment, but the idea that Dumfries and Galloway Council in my region would by default suddenly become responsible for management of local Crown estate assets is not exactly one that fills me with confidence. As I stressed at stage 1, that is meant with the greatest respect to Dumfries and Galloway Council, but I have not heard any great wish that it take on the assets at the Applegarth estate. Indeed, the Scottish Tenant Farmers Association, although it welcomes devolution of assets, is firmly of the view that those four rural assets could be successfully managed by the Scottish Government directly or through a body that is set up for that purpose. That recommendation was made at the ECCLR Committee and received cross-party support.

It is important to strike the right balance, in future management of the Crown estate, between local and national levels. We should recognise that a national body might be best suited to achieving desirable outcomes. Therefore, in some instances, it is right that national management structures will remain in place, but it is important to know which ones the Government recognises can potentially be managed at local level and which cannot.

For example, it is only right and sensible that a national body, with a Scotland-wide overview, be responsible for management of offshore renewables, energy-related assets and cables and pipelines. Recognition should be given to the national significance of the sea bed, which—rightly—should be managed nationally. The bill will ensure that the sea bed cannot be sold.

I shared the committee view that there should be provision in the bill to retain provision, in some instances, for devolution to occur where a local authority can demonstrate appropriate expertise, and that is considered to be beneficial from socioeconomic, environmental or sustainable development perspectives.

On the future sustainability of the Crown estate, I believe that it is important to establish and maintain a list of Crown Estate Scotland assets and associated liabilities, and for that requirement to have been included in the bill to underpin continuation of access to cross-subsidisation. I am pleased that the cabinet secretary has given us the assurance that, although John Scott’s amendment was withdrawn, that will still be the case.

Kelp—oh, boy! If we did not know about kelp before, we certainly know about it now, as do millions of people across Scotland. I sincerely welcome the provision on kelp harvesting, but I have many concerns. They are not exclusively about the environmental pros and cons of commercial harvesting of our natural kelp forest; they are more about the appropriateness of the late introduction of the topic.

Mr Andy Wightman correctly made points of order and lodged amendments. I have no issue with that, but we should probably ask ourselves whether that was the best way to deal with the issue and whether the matter was appropriate in a bill on the Crown estate.

I welcomed Mark Ruskell’s amendment at stage 2, but as a probing amendment only, to highlight the serious concerns about commercial kelp harvesting and the potential for environmental damage. His amendment would not provide the protection that environmental campaigners might expect. All kelp is equal, but some kelp is more important than other kelp. The Crown estate kelp might have been protected through the bill, but what about the thousands of square miles of kelp that will not? I like to think that Parliament takes decisions on our environment that are based on strong peer-reviewed scientific evidence.

That in no way undermines or undervalues the information and evidence that environmental and community groups and the kelp harvesting industry provided through meetings, email and social media, but there was simply no time to hold a satisfactory consultation and—this would have been my preference—to look at the evidence in committee for full scrutiny under the close watch of the public. What happened is not how I would like hugely important issues such as kelp harvesting to be dealt with.

As my colleague Angus MacDonald said in the Environment, Climate Change and Land Reform Committee, the bill is an enabling bill—it is not for banning anything. However, I enthusiastically welcomed the announcement that a review will be undertaken that could lead to additional commercial opportunities while ensuring that our wild kelp forests are protected. The cabinet secretary suggested that the licensing regime is robust, but I argue that the reason why we are talking about kelp is that it is not. I hope to play my part in the licensing review as a member of the Environment, Climate Change and Land Reform Committee.

I thank my colleagues across the chamber, the committee clerks, the witnesses and contributors who got us to this stage in the bill’s progress, and I look forward to its being passed this evening.

The Deputy Presiding Officer

Before I call the cabinet secretary, we shall have another short pause for the division bell to ring.

I call the cabinet secretary to wind up the debate. I ask members who are engaged in conversation to show a bit of respect to the cabinet secretary—they might learn things about kelp that they did not know.

17:56  



Roseanna Cunningham

I am grateful to members across the chamber—

The Deputy Presiding Officer

Excuse me, cabinet secretary. Some people were not listening to me, but I meant what I said.

Roseanna Cunningham

I am grateful to members across the chamber for their mainly helpful and constructive contributions to the debate. I want to characterise some of them briefly without getting drawn into the detail. John Scott gave us a good lesson on process; Claudia Beamish gave us a lesson on sustainable development; Andy Wightman, as ever, give us a lesson on history; and Tavish Scott, also as ever, gave us a lesson on Shetland. Each of those contributions exemplifies a lot of the speeches that we heard. I thank the members who have spoken and all the members who have made contributions as the bill has progressed through Parliament.

I said at the beginning of the debate that this is a historic day, as we have been debating the first ever bill in the Parliament on the management of the Scottish Crown estate. The parliamentary process has made improvements to the bill. The Government has listened and has accepted a number of the recommendations that were made in the stage 1 report. Discussions have been on-going—right up to the last second—on possible improvements to the bill, and I have sought to maintain a consensual approach while also retaining focus on the actual purpose of the bill, which is to create appropriate processes to change who can manage a Scottish Crown estate asset and to reform the governance and management framework while maintaining the revenue and capital value of the estate. Of course, in the past few weeks, it looked as though the purpose of the bill might be lost in the other debate.

In my view, the stage 3 amendments to section 7(2) are an excellent example of that consensual approach, as they strengthen the duties to take account of wider issues such as sustainable development, and ensure that that is done in a proportionate way.

Up until now, the management of the Crown estate has been governed by the Crown Estate Act 1961, which was expressed in terms of English property law and reflected the dominance of urban commercial property in the revenue of the UK-wide Crown estate. Of course, the balance of the Scottish Crown estate is quite different, and, since 1961, new industries such as oil, gas extraction, offshore renewables and aquaculture have developed, all of which have had an impact and will lead to significant revenue growth in the future.

We also have a vision, shared across this chamber, that in the management of the Scottish Crown estate we should strive to add value to the wellbeing of citizens throughout Scotland’s communities, embracing social benefits and sustainable development as well as financial gain. Part of that vision is our pledge to create a framework for further devolving management to the communities of Scotland, creating an opportunity to truly place the accountability of the Scottish Crown estate in the hands of people across the country. I make no apology for putting that emphasis on communities. Among the various organisations that have stepped forward at this point to show interest in management there are three councils—Orkney Islands Council, Shetland Islands Council and Western Isles Council—but we also have Portgordon Community Harbour Group, the Findhorn Village Conservation Company, Galston Estate Trust, St Abb’s and Eyemouth Voluntary Marine Reserve, the Tay and Earn Trust and the Lochgoilhead Mooring Association and Lochgoilhead Jetty Trust. That shows that there is an appetite out there among communities, and it is important to reflect that.

At times, kelp harvesting has seemed to overwhelm the purpose of the bill. I am not going to get dragged back into it at this point in the debate. We are where we are. We might feel that this has not been the most appropriate process to follow. Nevertheless, that is a debate that it might be best to have elsewhere than in the context of this stage 3 debate.

The bill has been improved and strengthened as a result of the parliamentary process. I am grateful to members of the Environment, Climate Change and Land Reform Committee and other members in the chamber for their contributions. We have a bill that will help to ensure the long-term management and sustainability of these important assets and, for the first time, there are new powers in legislation to change the manager of a Scottish Crown estate asset.

I am pleased to have created a historical first by bringing the first bill on the Scottish Crown estate before this Parliament. We have seized the opportunity to develop a new, modern, statutory framework that will support the realisation of our shared national ambition for some of Scotland’s most important assets.

Presiding Officer, I am proud to have moved the motion.

Final vote on the Bill

After the final discussion of the Bill, MSPs vote on whether they think it should become law.

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Final vote transcript

The Presiding Officer (Ken Macintosh)

The first question is, that motion S5M-14822, in the name of Roseanna Cunningham, on the Scottish Crown Estate Bill, be agreed to. We will have a division on the motion. Members should cast their votes now.

For

Yousaf, Humza (Glasgow Pollok) (SNP)
Wightman, Andy (Lothian) (Green)
Whittle, Brian (South Scotland) (Con)
White, Sandra (Glasgow Kelvin) (SNP)
Wheelhouse, Paul (South Scotland) (SNP)
Wells, Annie (Glasgow) (Con)
Watt, Maureen (Aberdeen South and North Kincardine) (SNP)
Torrance, David (Kirkcaldy) (SNP)
Tomkins, Adam (Glasgow) (Con)
Swinney, John (Perthshire North) (SNP)
Stewart, Kevin (Aberdeen Central) (SNP)
Stewart, David (Highlands and Islands) (Lab)
Stewart, Alexander (Mid Scotland and Fife) (Con)
Stevenson, Stewart (Banffshire and Buchan Coast) (SNP)
Somerville, Shirley-Anne (Dunfermline) (SNP)
Smyth, Colin (South Scotland) (Lab)
Smith, Liz (Mid Scotland and Fife) (Con)
Smith, Elaine (Central Scotland) (Lab)
Simpson, Graham (Central Scotland) (Con)
Scott, Tavish (Shetland Islands) (LD)
Scott, John (Ayr) (Con)
Sarwar, Anas (Glasgow) (Lab)
Russell, Michael (Argyll and Bute) (SNP)
Ruskell, Mark (Mid Scotland and Fife) (Green)
Rumbles, Mike (North East Scotland) (LD)
Rowley, Alex (Mid Scotland and Fife) (Lab)
Ross, Gail (Caithness, Sutherland and Ross) (SNP)
Robison, Shona (Dundee City East) (SNP)
Rennie, Willie (North East Fife) (LD)
Paterson, Gil (Clydebank and Milngavie) (SNP)
Neil, Alex (Airdrie and Shotts) (SNP)
Mountain, Edward (Highlands and Islands) (Con)
Mitchell, Margaret (Central Scotland) (Con)
McNeill, Pauline (Glasgow) (Lab)
McMillan, Stuart (Greenock and Inverclyde) (SNP)
McKelvie, Christina (Hamilton, Larkhall and Stonehouse) (SNP)
McDonald, Mark (Aberdeen Donside) (Ind)
McArthur, Liam (Orkney Islands) (LD)
McAlpine, Joan (South Scotland) (SNP)
Matheson, Michael (Falkirk West) (SNP)
Mason, Tom (North East Scotland) (Con)
Mason, John (Glasgow Shettleston) (SNP)
Martin, Gillian (Aberdeenshire East) (SNP)
Marra, Jenny (North East Scotland) (Lab)
Maguire, Ruth (Cunninghame South) (SNP)
Macpherson, Ben (Edinburgh Northern and Leith) (SNP)
Mackay, Rona (Strathkelvin and Bearsden) (SNP)
Mackay, Derek (Renfrewshire North and West) (SNP)
MacGregor, Fulton (Coatbridge and Chryston) (SNP)
Macdonald, Lewis (North East Scotland) (Lab)
MacDonald, Gordon (Edinburgh Pentlands) (SNP)
MacDonald, Angus (Falkirk East) (SNP)
Lockhart, Dean (Mid Scotland and Fife) (Con)
Lochhead, Richard (Moray) (SNP)
Lindhurst, Gordon (Lothian) (Con)
Leonard, Richard (Central Scotland) (Lab)
Lennon, Monica (Central Scotland) (Lab)
Lamont, Johann (Glasgow) (Lab)
Kidd, Bill (Glasgow Anniesland) (SNP)
Kerr, Liam (North East Scotland) (Con)
Johnstone, Alison (Lothian) (Green)
Johnson, Daniel (Edinburgh Southern) (Lab)
Hyslop, Fiona (Linlithgow) (SNP)
Hepburn, Jamie (Cumbernauld and Kilsyth) (SNP)
Haughey, Clare (Rutherglen) (SNP)
Harvie, Patrick (Glasgow) (Green)
Harris, Alison (Central Scotland) (Con)
Harper, Emma (South Scotland) (SNP)
Hamilton, Rachael (Ettrick, Roxburgh and Berwickshire) (Con)
Halcro Johnston, Jamie (Highlands and Islands) (Con)
Griffin, Mark (Central Scotland) (Lab)
Greer, Ross (West Scotland) (Green)
Greene, Jamie (West Scotland) (Con)
Gray, Iain (East Lothian) (Lab)
Grant, Rhoda (Highlands and Islands) (Lab)
Grahame, Christine (Midlothian South, Tweeddale and Lauderdale) (SNP)
Golden, Maurice (West Scotland) (Con)
Gilruth, Jenny (Mid Fife and Glenrothes) (SNP)
Gibson, Kenneth (Cunninghame North) (SNP)
Freeman, Jeane (Carrick, Cumnock and Doon Valley) (SNP)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Forbes, Kate (Skye, Lochaber and Badenoch) (SNP)
FitzPatrick, Joe (Dundee City West) (SNP)
Finnie, John (Highlands and Islands) (Green)
Findlay, Neil (Lothian) (Lab)
Fee, Mary (West Scotland) (Lab)
Fabiani, Linda (East Kilbride) (SNP)
Ewing, Fergus (Inverness and Nairn) (SNP)
Ewing, Annabelle (Cowdenbeath) (SNP)
Dugdale, Kezia (Lothian) (Lab)
Dornan, James (Glasgow Cathcart) (SNP)
Doris, Bob (Glasgow Maryhill and Springburn) (SNP)
Dey, Graeme (Angus South) (SNP)
Denham, Ash (Edinburgh Eastern) (SNP)
Cunningham, Roseanna (Perthshire South and Kinross-shire) (SNP)
Crawford, Bruce (Stirling) (SNP)
Corry, Maurice (West Scotland) (Con)
Constance, Angela (Almond Valley) (SNP)
Cole-Hamilton, Alex (Edinburgh Western) (LD)
Coffey, Willie (Kilmarnock and Irvine Valley) (SNP)
Chapman, Peter (North East Scotland) (Con)
Carson, Finlay (Galloway and West Dumfries) (Con)
Carlaw, Jackson (Eastwood) (Con)
Campbell, Aileen (Clydesdale) (SNP)
Cameron, Donald (Highlands and Islands) (Con)
Burnett, Alexander (Aberdeenshire West) (Con)
Brown, Keith (Clackmannanshire and Dunblane) (SNP)
Briggs, Miles (Lothian) (Con)
Bowman, Bill (North East Scotland) (Con)
Bibby, Neil (West Scotland) (Lab)
Beattie, Colin (Midlothian North and Musselburgh) (SNP)
Beamish, Claudia (South Scotland) (Lab)
Ballantyne, Michelle (South Scotland) (Con)
Baker, Claire (Mid Scotland and Fife) (Lab)
Baillie, Jackie (Dumbarton) (Lab)
Arthur, Tom (Renfrewshire South) (SNP)
Allan, Alasdair (Na h-Eileanan an Iar) (SNP)
Adamson, Clare (Motherwell and Wishaw) (SNP)
Adam, George (Paisley) (SNP)

The Presiding Officer

The result of the division is: For 119, Against 0, Abstentions 0.

The motion is therefore agreed to unanimously and the Scottish Crown Estate Bill is passed. [Applause.]

Motion agreed to,

That the Parliament agrees that the Scottish Crown Estate Bill be passed.

The Presiding Officer

The next question is, that motion S5M-14825, in the name of Humza Yousaf, on the Crime (Overseas Production Orders) Bill be agreed to.

Motion agreed to,

That the Parliament agrees that the relevant provisions of the Crime (Overseas Production Orders) Bill, introduced in the House of Lords on 27 June 2018, relating to the making of overseas production orders, the people who may apply for orders, the requirements for the making of orders, the content and effect of orders, the variation or revocation of orders, the inclusion of non-disclosure requirements in orders, restrictions on the service of orders, the retention of electronic data and its use as evidence, procedural matters to be determined by court rules, the requirements to notify holders of confidential journalistic data of applications for orders in relation to that data, the effect of notices of application, the means of serving an order, and definitions for the purposes of the Bill, so far as these matters fall within the legislative competence of the Scottish Parliament and alter the executive competence of the Lord Advocate, should be considered by the UK Parliament.

The Presiding Officer

The next question is, that motion S5M-14827, in the name of Humza Yousaf, on the Offensive Weapons Bill be agreed to.

Motion agreed to,

That the Parliament agrees that the relevant provisions of the Offensive Weapons Bill, introduced in the House of Commons on 20 June 2018, relating to the creation of new offences in respect of corrosives, stop and search powers in relation to the new offence of possession of a corrosive substance in public, certain procedural provisions relating to the corrosives offences, a new defence specific to remote sales relating to the existing offence of sale of bladed articles to under 18s, a new offence of delivery of bladed articles to residential premises, a new offence of delivery of bladed articles to under 18s when purchased remotely from outwith the UK, changes to the definition of a flick knife, a new offence of possession in all place of certain knives and offensive weapons, arrangements for disposal of these certain knives and offensive weapons, and prohibition of certain firearms and commencement powers, so far as these matters fall within the legislative competence of the Scottish Parliament, should be considered by the UK Parliament.

The Presiding Officer

The next question is, that motion S5M-14838, in the name of Graeme Dey, on the approval of a Scottish statutory instrument, be agreed to.

Motion agreed to,

That the Parliament agrees that the Budget (Scotland) Act 2018 Amendment Regulations 2018 [draft] be approved.

The Presiding Officer

The next question is, that motion S5M-14839, in the name of Graeme Dey, on the remit of a committee be agreed to.

Motion agreed to,

That the Parliament agrees, under Rule 6.1, that the remit of the following mandatory committee be amended—

Name of Committee: Standards, Procedures and Public Appointments Committee

Remit: To the remit set out in Rule 6.4 shall be added—

Matters relating to Scottish general elections falling within the responsibility of the Cabinet Secretary for Government Business and Constitutional Relations.

Scottish Crown Estate Bill as passed

This Bill was passed on 21 November 2018 and became law on 15 January 2019 
Find the Scottish Crown Estate Act on legislation.gov.uk

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