Select Committee on Scottish Affairs First Special Report



(c)  We believe a more Cross-departmental approach to the provision of support mechanisms within the agricultural sector is required which would also necessitate close partnership working between the Scottish Executive and the UK Government.

The Scottish Executive agrees that the problems of the agriculture industry require a cross­departmental approach. That approach is reflected in the Steering Group set up to advise the Scottish Executive on a new strategy for the future of farming in Scotland. This Steering Group includes Scottish Enterprise, Highlands and Islands Enterprise, Scottish Natural Heritage, representatives of the banking sector and the retail sector, and representatives from the various farming organisations. The aim of the strategy will be to take a holistic view of the role of farming in a modern Scotland and to ensure that the policies of the Executive and its agencies are targeted at achieving that view. In doing this work, the Scottish Executive is working closely with counterparts in Whitehall, the National Assembly for Wales and Northern Ireland Assembly.

(d)  We are confident that the Scottish Executive will want to keep a careful eye on the cost of sea ferries and to ensure that islanders, particularly those with limited funds can make necessary journeys economically.

This year the Executive is making available to Caledonian MacBrayne Limited the highest ever level of subsidy to support the lifeline ferry services they deliver and to ensure that fares are kept as low as possible. To comply with European Union requirements, the services provided by Caledonian MacBrayne will have to be competitively tendered in the future. In announcing the Executive's initial consultative proposals for this process, the Minister for Transport and the Environment gave an assurance that "in drawing up service specifications for tendering we will make clear that fares and levels of service will be protected".

The lifeline ferry services to the Northern Isles have already been subject to competitive tendering and a tendering process for the contract beginning in 2002 is currently underway. Under these arrangements, the Scottish Executive has to approve annual fare increases and expects these to be no more than the rate of retail price inflation.

(e)   Calum MacDonald MP, has come up with an innovative scheme which we believe should be looked at closely. He wants the proposed new Highlands and Islands Transport Board to be enabled to sell petrol it has bought in bulk on the open market directly to retailers. He believes that this would save up to 10p per litre. The Highland Council currently does something similar with marine fuel, passing on cost savings to local fishermen.

The Scottish Executive and local authorities in the Highlands and Islands have commissioned Deloitte and Touche to examine the case for establishing a Highlands and Islands Transport Authority and the functions it might discharge. It is premature to speculate on the outcome of that study, but we will consider carefully, in conjunction with local authorities and other partners in the region, how any such authority can best help to address the problems of high fuel costs in the area.

(f)  The Scottish Executive might want to consider introducing and financing a remote living allowance, essentially to compensate for the higher cost of living, including fuel and travel, in remote or island communities. It could take the form of an additional grant allocation targeted at identifiable areas of need, which would be paid to local authorities and passed on directly to the community in the form of a reduction in council tax. Appropriate criteria would need to be drawn to ensure that areas and individuals enjoying relative affluence were not unduly subsidised.

The Scottish Executive provides for the additional costs to councils serving remote and dispersed rural and island communities through special measures in the local government finance distribution formula. Adjustments redistribute around £40 million of grant support towards rural councils each year, helping to meet additional service costs and hold down council tax levels. Additional assistance, totalling over £24 million this year, is provided through the Special Islands Needs Allowance to compensate councils with significant islands costs. A review of the level and distribution of SINA is due to be completed this year.

In addition, the Executive is providing record levels of support for lifeline air and ferry services and through the Rural Transport Fund, £14.6 million in new investment over 3 years from 1998/99 to improve transport links in rural Scotland.

(g)   The plight of the homeless is a disgrace to modern Scotland. Being homeless and ill without proper recourse to treatment is entirely unacceptable. We hope and believe that the Scottish Executive will treat the adequate provision of medical care for all sections of society throughout Scotland with the seriousness it deserves. This should include drug addicts who, according to a representative from Strathclyde Police that we met in Glasgow, are unwelcome on GP's lists.

Tackling the problems of homelessness will remain one of the Scottish Executive's top priorities. We have increased funding available to the Rough Sleepers Initiative for the five years from 1997 to 2002 to £40 million which includes £4 million this year specifically targeted through the Health Boards on the health needs of rough sleepers.

In Glasgow a high level Strategy Team, including housing, social work and health interests, is identifying specific action to address the problems of rooflessness and hostel provision in Glasgow. £2 million has been allocated to progress the conclusions of the team.

The Homelessness Task Force, chaired by the Minister for Social Justice, Jackie Baillie, is considering the nature and causes of homelessness throughout Scotland. Its recommendations in relation to legislative change are being progressed in the forthcoming Housing Bill, and it will report next year on its wider consideration of action which might be taken to prevent, and to alleviate homelessness.

We recognise the problems which homeless people can face throughout Scotland in accessing appropriate medical care and, while much needs to be done, we welcome the efforts by Primary Care Trusts and committed primary care professionals, including GPs, to addressing the needs of homeless people. Following the Scottish Executive's Health and Homelessness Conference, on the 23rd October, guidance will be issued to the service on improving health care services for homeless people and we will ensure best practice is effectively disseminated.

(h)  Energy Action Scotland recommended a "detailed cost/benefit analysis of the impact on Scottish households of living in cold damp homes versus warm dry and healthy homes." We hope that the Scottish Executive will undertake such an exercise, since any constructive conclusions will be helpful in a country whose climate tends to towards the cold and damp.

Introduced in July 1999, the Warm Deal helped 40,000 low income families and pensioners make their homes more energy efficient in its first year, providing a comprehensive package of home energy efficiency measures for households on certain state benefits. The Scottish Executive are commissioning a study to examine the feasibility of measuring the health impacts of the Warm Deal. It is anticipated that this will lead to a major 3 year programme of research, commencing in 2001. This research will assess the impact of the Warm Deal measures on housing and living conditions; identify which aspects of health are affected—physical, mental or well being—and for which types of household; compare the effects of the Warm Deal with and without additional central heating measures; and quantify any cost savings associated with health improvement arising from the Warm Deal.

The Executive are committed to providing, warm, dry homes to help tackle the causes of poor health arising from house condition. In addition to the Warm Deal, the Minister for Communities announced in September that resources will be provided so that all pensioners and all social tenants across Scotland will have central heating within five years commencing 1 April 2001. A total of £350 million is to be invested. Around 70,000 pensioners and 71,000 other council and housing association tenants are expected to benefit from a package of insulation and central heating systems worth up to £2,500. It will reduce average fuel bills to about £500 per annum and 90% of beneficiaries will be helped out of fuel poverty.

(i)  The Scottish Executive is addressing the housing problem in Scotland. The question of housing stock transfer has been the cause of much topical debate. We would confine our comment to the call for decent and affordable social housing to be available.

The Executive is increasing significantly the investment in housing in Scotland. Moreover, through the Scottish Homes Development Programme and the New Housing Partnerships (NHP) Programme, increased public resources are attracting further private investment to accelerate the provision of new, improved affordable housing.

One strand of NHPs is to encourage councils, subject to the approval of tenants in a ballot, to transfer houses to community ownership through registered social landlords (RSLs). As well as giving tenants more involvement in decisions affecting their houses, community ownership can unlock billions of pounds of investment for Scotland's council housing stock. The Executive is taking steps to ensure that, after such transfers, councils continue to have access to a supply of housing to meet the needs of homeless people. Model contracts to achieve this are being developed jointly by COSLA and the Scottish Federation of Housing Associations.

In addition, we recognise the importance of ensuring the quality of our housing stock in rural areas. This year, Scottish Homes will be providing over 1,500 new homes in rural communities, representing an investment of around £45m. The Scottish Executive will also be taking forward the Rural Partnership for Change Initiative, considering how to target resources most effectively at housing in rural areas and finding new ways to tackle housing pressure.

(j)  As well as the call for an analysis of the impact on Scottish households of cold, damp houses, Energy Action Scotland also recommended a review of fuel poverty and energy efficiency in Scotland. We strongly agree with this.

The Department of Trade and Industry is leading an inter­departmental Ministerial Group on Fuel Poverty to develop a long­term strategy for tackling the problem. The work of the group covers Scotland and the Executive is represented by the Deputy Minister for Local Government. The strategy will be published later this year.

We are also working to ensure that all new houses in Scotland are energy efficient through the Building Standards Regulations. These are kept under constant review and are presently being amended to further improve the requirements for thermal insulation and boiler efficiency. This amendment, which it is intended will come into force at the end of 2001, will improve energy efficiency by about 25-30% and will place Scotland in the top third of European countries.

(k)  We note that in two of its recent reports the Health Committee recommended an integrated health and social care system. We see this formal connection as overdue and inevitable if meaningful progress towards minimising health inequalities and developing a seamless care system is to be made. We would encourage the Scottish Executive to look very carefully at what it could do to bring about such an arrangement in Scotland.

We clearly want the people of Scotland to have access to the best possible health and social care services, but believe we can do this without full integration. As the Royal Commission on Long Term Care for the Elderly, joint planning and joint working is the key to providing effective and integrated community care services. Largely in line with the Commission's recommendations, the Joint Future Group has worked to bring together representatives from CoSLA, local councils and the NHS to develop proposals for joint working on community care. It is intended that by 2002 all community care services for older people will be jointly managed and jointly resourced. Meanwhile, we have in place a number of measures to support joint working including:

·  Providing £7.5 million of incentive funding to implement 'Modernising Community Care: An Action Plan' which aims to modernise both the management of community care and the services themselves;

·  Establishing the Joint Future Group to develop a set of key practical measures which agencies have to adopt to improve partnership working, and provide a lead on the balance between residential and home-based care; and

·  Supporting the pilot study in Perth and Kinross to integrate the planning, commissioning and delivery of social care and health services. The pilot should provide a model of joint working for the future.

We place great value on agencies working together to provide the services that people want and need. The measures we are taking will go a long way to delivering more joint, modern and effective person-centred services.

(m)  We urge the Minister for Communities to continue to support the establishment of a national telephone money advice service, with particular reference to the difficulties associated with debt. To compliment the hot-line, the Scottish Executive might also wish to develop the effectiveness of money advice services which are delivered into Scotland's poorer communities, seeking to reach the people who may not, for one reason or another, make use of the hot-line service. This will involve the allocation of extra resources as well as making better use of existing provision.

The Scottish Executive is committed to improving the effectiveness of money advice services in Scotland's deprived communities. We are currently working up plans for a Scottish pilot to test out how best a national debtline for Scotland can be implemented to provide access to free, quality money and debt advice. We are also working with Money Advice Scotland to consider what needs to be done to strengthen the infrastructure of money advice provision in Scotland to support the debtline.

(n)  There is a need for local authorities to develop debt management strategies and we would encourage local authorities in Scotland to do so.

The Scottish Executive is discussing with CoSLA how the money and debt advice services provided by local authorities in Scotland can be improved.

(o)  We recommend that the Government should promote with full vigour the development of credit unions, ensuring that, with appropriate safeguards for users, they can operate within a creative legislative framework, and thereby efficiently serve both individuals and local communities.

Legislation on credit unions is a reserved matter but the Executive supports moves for new legislative powers for credit unions and the introduction of a proportionate and effective regulatory regime for credit unions from the FSA. The Scottish Executive has supported moves to establish a central support organisation for credit unions as recommended in the Treasury Task Force report. The Executive has contributed to a programme to design and deliver health checks for credit unions in Scotland, the initial pilot will be rolled out to create a Scotland wide service. We are working with the key organisations in relation to credit unions to develop a national development strategy for credit unions, which will be published later this year.

(t)  We would hope that the Scottish Executive might consider introducing a national concessionary travel scheme at the earliest opportunity.

The Scottish Executive recently announced a £500m spending package designed to deliver a modern, integrated transport network serving all of Scotland's needs. This package includes new resources for local authorities to enhance existing concessionary travel schemes. From October 2002, Scottish pensioners and those with disabilities will have free off-peak bus travel within existing scheme boundaries.

(hh)   We recommend that when a review of local government finance does take place, the cost of effectively tackling poverty is then carefully re-examined and re-weighted in any new formula.

Local government has a vital role in tackling poverty and promoting social inclusion across the range of its service responsibilities, including education, social work, consumer advice, etc. We are looking with councils at how the local government finance arrangements might better assist them in planning and delivering our shared priorities, for example by providing 3 year budget settlements and improved distribution arrangements. As a matter of priority, we are reviewing with the Convention of Scottish Local Authorities the existing specific allowances for poverty and deprivation within the grant distribution formula and whether more account should be taken of these effects. The review will be completed this autumn, in time for the conclusions to be considered for next year's settlement. Pending the outcome of the review, additional special deprivation payments totalling £21 million have been made available for this year.

The cost of effectively tackling poverty is clearly not only limited to local authorities. Following the recommendations of the Arbuthnott Committee, a new funding formula for the allocation of £4 billion between Scotland's Health Boards will be introduced by the Scottish Executive. Building on the key aim of tackling health inequalities, the new formula will target more resources at those areas in greatest need, whether as a result of deprivation or remoteness.


Policy on New Deal is reserved, although the Scottish Executive and economic development, education and training, local government and voluntary organisations in Scotland play a key role in delivery. The Scottish New Deal Advisory Task Force monitors and advises on the development of New Deal in Scotland, and has recently met the Minister for Employment, Welfare to Work and Equal Opportunities. Welfare to work policies are constantly evolving, based on experience and the findings of evaluation work, and the Committee has highlighted some important issues which are worth considering.

(y)  The six month engagement period for New Deal programmes should be an average rather than a maximum. In some cases participants would be able to move on within three months, in other cases it will take longer.

At present individuals are limited in most cases to six months for the work experience options, and twelve months for full-time education and training. The core aim of New Deal is to seek to move young people quickly back to work, and to avoid prolonged spells of detachment from the labour market. In some cases participants would probably benefit from a longer period in a work experience option if they were making real progress towards employability. There could also be scope for stronger incentives for providers to encourage young people to move on quickly from an option into work.

(z)  We recommend that so far as possible there should be parity between the various New Deal programmes.

The programmes are designed to meet the specific needs of different groups in the labour market. New Deal 25+ was enhanced with the addition of new gateway and advisory elements, and access to New Deal 18-24 options where appropriate, from April and a re-engineered New Deal 25+ will be launched from next April. New Deal for Lone Parents has been effective in its present form in helping people to return to work, and New Deal 50+ is also beginning to have a significant impact. Lone Parents and over-50 year olds will generally already have the skills and work experience which many young people lack, and training is available within both New Deals if required.

(aa)  We recommend that the Government should not be blind to innovation beyond that displayed by its assault on poverty through welfare to work programmes. Major diseases require intensive care; and there are areas of Scotland that in our opinion, will not respond to the treatment currently on offer. Awareness of the nature of the problem and a willingness to invest public money in suitable job creation schemes should be a matter of priority. The jobs need to be sustainable in a globally competitive world and offer reasonable rates of pay to attract people from welfare to work.

As part of the Review of the Enterprise Networks in Scotland, the Scottish Executive will deliver a Strategy for Enterprise to provide strategic clarity in economic development services and set out the vision for, and purpose of, the Enterprise Networks. A key task for the Networks will be to work more effectively with UK wide agencies to implement the overall UK Government objective of employability. The Strategy for Enterprise will be published early in 2001. Alongside this, the reviews of both Training for Work and the New Futures Fund will deliver a more intensive focus on tackling unemployment amongst the most disadvantaged groups in society, who can be furthest removed from the labour market.

On a more local level, Employment Zones and Action Teams are tackling the problems of areas of very high unemployment, and addressing individuals' barriers to re-entering employment. Employment and the number of vacancies in Scotland are around record levels, and there are substantial levels of vacancies in all parts of the country.

There are, however, variations in labour market demand at local level which need to be addressed through local regeneration policies, for example SIPs. Public investment, for example in improving the housing stock, has the potential to generate significant additional jobs in areas of high unemployment. We are expecting the transfer of Glasgow City Council's housing stock to generate up to £1.6bn investment and with up to 3000 additional jobs possibly being created as a consequence of the initiative.

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