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Title    : Scottish Parliament: Committees: Finance: Official Reports:
Meeting 19, 2000
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Text

Session 1 (2000) 
Scottish Parliament
Finance Committee
Official Report 
Meeting No 19, 2000 

--------------------------------------------------------------------------------
 
14 July 2000 



CONTENTS

Tuesday 4 July 2000


FINANCE COMMITTEE 19TH MEETING 2000, SESSION 1 
   
EUROPEAN STRUCTURAL FUNDS 
GOVERNMENT RESOURCES AND ACCOUNTS BILL 
SCOTTISH PARLIAMENT BUILDING PROJECT 

 

FINANCE COMMITTEE
19th Meeting 2000, Session 1

CONVENER

*Mike Watson (Glasgow Cathcart) (Lab)

DEPUTY CONVENER

*Elaine Thomson (Aberdeen North) (Lab)

COMMITTEE MEMBERS

*Mr David Davidson (North-East Scotland) (Con)
*Rhoda Grant (Highlands and Islands) (Lab)
*Mr Adam Ingram (South of Scotland) (SNP)
George Lyon (Argyll and Bute) (LD)
*Mr Kenneth Macintosh (Eastwood) (Lab)
*Mr Keith Raffan (Mid Scotland and Fife) (LD)
Dr Richard Simpson (Ochil) (Lab)
*Mr John Swinney (North Tayside) (SNP)
*Andrew Wilson (Central Scotland) (SNP)

*attended

WITNESSES

Mr Jack McConnell (Minister for Finance)
John Henderson (Scottish Executive Finance Division)

CLERK TEAM LEADER

Callum Thomson

SENIOR ASSISTANT CLERK

Anne Peat

ASSISTANT CLERK

Sean Wixted

LOCATION

Committee Room 1
 
--------------------------------------------------------------------------------
 
14 July 2000 



Scottish Parliament

Finance Committee

Tuesday 4 July 2000

(Afternoon)

[THE CONVENER opened the meeting at 12:51]

The Convener (Mike Watson): I open the meeting with the usual message about
pagers and mobile phones. This will be our last meeting this term or
session—I am not sure which is correct—before the summer recess, so we
have a fairly lengthy agenda. Before we start, I report that I have
received apologies from George Lyon and Richard Simpson.

I ask members to agree to take items 2, 3 and 4 of the agenda in private.

Mr Kenneth Macintosh (Eastwood) (Lab): I do not know whether you want to
discuss this now, convener, but—

The Convener: Before you say anything, Ken, do members agree to hold items
2, 3 and 4 in private?

Members indicated agreement.

Mr Macintosh: I have looked at the timing of the agenda and there might be
a big gap between items 4 and 5. I suggest that we move items 6 and 7 into
that gap. I thought that I would have to go to another committee meeting,
but that committee will meet in this room after the Finance Committee's
meeting, so I will not have to leave. However, the Finance Committee will
have to finish on time and I would like to fit items 6 and 7 in.

The Convener: That suggestion makes sense—there is the possibility at
least that there will be a gap between items 4 and 5. If the meeting is
still going at 2.15 pm, we will break and take evidence from the minister.
Is that agreed? That would mean that we might be able to finish a bit
earlier.

Members indicated agreement.

Andrew Wilson (Central Scotland) (SNP): Is it possible for us to contact
the official report? The Official Report of our previous meeting is not yet
available and it is difficult for us to hold a meeting when that is the
case. Such situations probably arise quite a lot due to resource
constraints that are no fault of the official report. As members of the
committees, we should make known our concerns so that the management of the
Parliament can consider properly resourcing the official report, if
resources are the problem.

The Convener: We all recognise the very efficient job that is done by the
official report, but there is a limit to what can be done. I am not
surprised that such a situation arises at this time of year, when we are
busy and meetings pile up. You have, however, made your point.

If we do not have the Official Report to refer to, there is a bit of gap
for us, particularly when there are agenda items such as the one that we
are about to consider. What was said at last week's meeting will impact
directly on that item.

I am sure that Andrew Wilson does not mean to criticise the official
report.

Andrew Wilson: Not at all.

The Convener: We will note our concern in those terms. We are not being
critical—we are simply noting that the logistics are such that we have
not been provided with the report of last week's meeting.

12:54

Meeting continued in private.

 
14:01

On resuming—

European Structural Funds

The Convener: There have been no further developments in relation to our
inquiry and we have yet to receive a formal response to our second letter
to the Chancellor of the Exchequer. The Presiding Officer's letter
suggested that there was a good chance that we might at least be able to
take evidence from an official from the Treasury, but that has not been
confirmed yet. I will do my best to get an answer to that request before we
break for the summer recess.

The same problems beset the European Committee, which seems to have moved
on. Members will have seen the questions that were put to the Minister for
Finance, which seem to cover the European Committee's attempt to fill the
gaps that were left by the non-appearance of a minister or official from
the Treasury. I am informed that the European Committee now hopes to
publish its report within a week of Parliament's return from the summer
recess.

We must now decide what to do about collecting extra information, if we
need it. The information that was supplied by Jack McConnell to Hugh Henry
is useful for our inquiry and we must decide now whether we need further
information. If so, we must press on and attempt to get a Treasury official
to attend a meeting of the Finance Committee after the recess.

Andrew Wilson: We all share the disappointment that the inquiry has been
stuck in this rut for some time. The specific information that I asked the
minister for towards the end of the evidence session at the previous
meeting remains the key piece of information that is required to answer the
questions that are in my mind—if not in the minds of other committee
members—and I have notified the clerk of that. That information concerns
the year-in, year-out allocation through the block and formula arrangement
and the way in which it compares with comparable expenditure. At the
previous meeting, the minister confirmed that for the first time. If that
information could be elicited from the Treasury, it would help us to
confirm whether the minister's assertions at the previous meeting were
correct. That is the one substantial and specific piece of information that
we require.

The Convener: Are you suggesting that we seek that information by writing
to the Treasury?

Andrew Wilson: Before we invited evidence from the Treasury—which must be
about seven or eight weeks ago—I suggested that we write to the Treasury
in advance of the evidence-taking session, so that we could discuss matters
with an official or minister on the basis of written evidence that we would
have had in front of us. I still believe that we require such evidence
before we consider what use we can make of oral evidence.

Mr David Davidson (North-East Scotland) (Con): That is much the same area
that I questioned the minister on—I did not receive a clear answer
either.

Let us return to the letter that the convener received from David Steel,
about his speaking to John Reid. Has Sir David given any indication of John
Reid's view of our position? The letter does not say very much. We are
inviting a Treasury official to the committee, but have we received
anything from the Secretary of State for Scotland?

The Convener: No. I did not contact the Secretary of State for Scotland;
the Presiding Officer did that. We are no further forward than is indicated
by the information in David Steel's letter.

Mr John Swinney (North Tayside) (SNP): The Secretary of State for
Scotland's speech to the Scottish Grand Committee on 12 June made clear his
view and that view is on the parliamentary record. He believes that
information on European structural funds—a matter that must be addressed
by the Finance Committee or the European Committee—could be supplied by
the Minister for Finance. However, the Minister for Finance has made it
clear that there are aspects of the inquiry on which he cannot comment
because he does not have ministerial responsibility for them. That is a
fair point. There is no real debate about the Secretary of State for
Scotland's stance on the issue—he is passing the issue to the Minister
for Finance to deal with. The Minister for Finance is quite rightly saying,
however, that he cannot answer such questions because he does not have
ministerial responsibility for those matters. We must insist that on such
substantial issues as this—when there is an element of reliance on
reserved issues and the responsibilities of UK ministers—we are entitled
to hear the opinions of those ministers. We cannot complete our inquiry
without them.

Mr Davidson: That is just where I was heading. I thank John Swinney for his
intervention.

Mr Keith Raffan (Mid Scotland and Fife) (LD): I agree with John Swinney.
There are two issues: getting information and the ability of a
parliamentary committee to count on co-operation in carrying out its work.
I do not understand why that is so difficult, especially as Executive
ministers have given evidence to select committees of the House of Commons.
Surely there should be a two-way flow of information.

The Convener: Nobody would disagree with that, Keith. We have made that
point clearly in the second letter, if not in the first. However, there
will not be such a two-way flow of information in this inquiry, although we
may wish for it. There comes a point at which one must stop flogging the
horse, because it is dead.

We can seek the information we require in the way Andrew Wilson has
suggested. I have not given up hope of getting a Treasury official to come
to one of our meetings and will press David Steel on the matter again this
week. I do not disagree with Keith Raffan, but we must get the information
that will enable us to complete our inquiry. Andrew Wilson made a specific
suggestion—I ask him to clarify what information he seeks and the source
from which we should invite it.

Andrew Wilson: There should be a firm statement in our report about taking
evidence from outwith the Scottish Parliament. We need to make that
position clear at the outset.

The evidence is quite detailed and I wonder whether the clerk could
undertake to go back to the previous evidence. Essentially, we are looking
for clear annual information about the comparable expenditure in England
and Wales since the inception of structural funds. That expenditure was the
basis of the calculation for the Barnett formula allocation of structural
funds to the Scottish budget. The information we need is reasonably
detailed, but it is also easily obtainable annually.

The Convener: The information is not something that we could expect the
Minister for Finance to provide us with, because it refers to England and
Wales.

Andrew Wilson: No. Getting that information would require the unpicking of
the comparable expenditure in the English and Welsh budgets. It would be a
matter for Treasury officials.

The Convener: Is it agreed that we should seek that information?

Members indicated agreement.

Mr Raffan: The letter from the Presiding Officer is clearly a holding
reply, so I am not sure that you are right in your judgment that we are not
going to get anybody—

The Convener: No, sorry, let me be clear: the reference to horses and
flogging was in respect of a ministerial visit to the committee.

Mr Raffan: Oh, right.

The Convener: I made it clear that I will go back to the Presiding Officer
tomorrow on behalf of the committee to find out where we are and to say
that we do not regard the matter as closed.

The European Committee is publishing a report and we do not want to be too
far out of kilter with the timing of that report. I hope that we will
return to the issue in our first meeting after the summer recess.

Mr Macintosh: Will there be an interim report that we can discuss at that
stage, or will we be coming back to hear evidence from the Treasury?

The Convener: It would be normal to finish taking evidence before we begin
to put the report together.

Mr Macintosh: So nothing will happen over the summer?

The Convener: It is only fair that Callum Thomson and Anne Peat should get
some summer holidays.

Mr Raffan: I presume that we could draft a report of some sort. As you know
from this morning's session, convener, other committees embark on drafting
of reports before they have heard final evidence—the cross-party group on
drug misuse, for example. I agree with your point about not getting too far
out of kilter with the European Committee.

The Convener: I did not want to commit Callum Thomson or Anne Peat to such
work without speaking to them first.

Mr Raffan: That is fair enough.

The Convener: Callum, would it be possible to have a draft report ready for
our return after the recess?

Callum Thomson (Clerk Team Leader): Yes—but with the caveat that Andrew
Wilson's point is fundamental to the inquiry. However, we should be able to
draft other aspects of the report for the first week back.

The Convener: Given that the Treasury does not go on holiday until the end
of July, there will be time for evidence to come through.

Mr Swinney: There will be a skeleton staff.

The Convener: Yes—I am sure that they do not lock the doors during
August. We will proceed on that basis and have a preliminary report ready
when we come back in September.

Government Resources and Accounts Bill

The Convener: We move on to agenda item 5. I am pleased to welcome the
Minister for Finance—

The Minister for Finance (Mr Jack McConnell): Here we go again.

The Convener: I also welcome Mr John Henderson of the Scottish Executive
finance division. They are here to consider the Government Resources and
Accounts Bill. Members have received a memorandum on the matter. Minister,
do you wish to make an opening statement?

Mr McConnell: I will make a brief statement. The amendment to the
Government Resources and Accounts Bill, which we have been discussing with
ministers and colleagues at UK level, will be debated in the House of Lords
this afternoon. On Thursday, the Scottish Parliament will be asked to
approve the proposal. I therefore thought it important—both in principle
and because it will be beneficial in practice—that the Finance Committee
should have an opportunity to discuss the issues on behalf of the
Parliament. I hope that we can deal today with questions or comments that
members might have on the details of the proposal. If there are any
questions that we cannot deal with, I will be happy to provide further
information to members before Thursday afternoon's debate.

As members will know, Partnerships UK is a new body, which was set up as a
company to support the public sector in developing public-private
partnerships. It will be a PPP itself, with a 49 per cent Government stake.
We want to have the option, which we will propose that the Scottish
Executive should take up, of having a stake in the public sector part of
Partnerships UK. The provision will allow the Scottish Executive to take up
to 10 per cent of the UK Government's stake. I think that that is good news
for Scotland. It would give us influence in and a say in the organisation
as well as a stake in its success, which could only be beneficial for
Scottish public services. The stake would cost between £1 million and £2
million, which we would have to identify within our budget and report back
on to the committee in the usual way.

14:15

The benefit that Partnerships UK will bring is that we will have a central
resource that will pool public and private sector skills. We will use those
skills to ensure that projects throughout the UK—particularly in
Scotland—are delivered to the highest quality and achieve maximum value
for money and to ensure that we have the best professional advice that is
available. In the longer term, those skills can be developed to improve
further public services and infrastructure.

Just as we will not be obliged to take the stake for which the provision
allows, public sector organisations in Scotland—whether the Scottish
Executive, councils or other bodies—will not be obliged to use
Partnerships UK. They will do so only where that represents value for
money. That choice is important and it is already being taken by several
Scottish schools projects and by the Scottish Tourist Board. We are keen to
show our willingness to support that. This is a good UK initiative, in
which Scottish involvement can only be beneficial for our budget, our
services and our relationship with our UK Parliament colleagues.

I hope that the Scottish Parliament will support the proposal firmly on
Thursday afternoon.

The Convener: I will start by asking one or two questions on the mechanics
of the power. The issue is dealt with in the memorandum under the heading
"Constitution of PUK". The memorandum says that

"PUK will be a public company"

and that

"Scottish Ministers should be able to take up to a 10% share-holding."

Do you intend that the Scottish Executive should take the full 10 per cent?
The paper mentions an advisory council of the public sector stakeholders.
Will there be a board, as there is in any other public company? If so, who
would represent the Scottish Executive?

Mr McConnell: On the size of the stake, the provision will allow us to take
up to 10 per cent. If the money can be delivered from the Scottish
Executive's budget, I hope that we can take as much as that. We will
certainly want to consider taking between 5 per cent and 10 per cent. We
will seek to identify the money for that before a final decision is
confirmed.

Two issues arise in relation to representation. First, as a stakeholder,
the Executive will have direct representation on the advisory council. It
is yet to be decided at what level that representation will be, but it is
important that we are represented. Having a stake in PUK will give us the
right to be consulted on all appointments to the board. Rather than simply
having a Scottish representative on the board, we will have a say on the
composition of the board as a whole. That is better than having a
constitutional right to a token nominee.

Mr Swinney: I want to ask about the parliamentary processes that are
involved. We will be asked to consider a motion to endorse the principle of
the creation of Partnerships UK and the participation of Scottish
ministers. That motion will go before Parliament on Thursday. Why, then,
was it proper for you to say in an answer to a written parliamentary
question on 13 June:

"I am pleased to be able to announce that the Executive will take a
financial interest in Partnerships UK"?—[Official Report, Written
Answers, 13 June 2000; Vol 7, p 78.]

Mr McConnell: That is because it is our clear intention to do that and to
legislate for that provision. It became clear that the best way to achieve
that was through an amendment to the Government Resources and Accounting
Bill, which is why the proposal is before the Scottish Parliament this
week. Instead of delaying or seeking other means of legislating, we can
move quickly on the matter and be able to use the powers. However, our
intention is clear: we wish to hold a stake in PUK so that Scotland can
have a full say in its development.

Mr Swinney: I am going to make a parliamentary point. Parliament has been
asked to approve a motion several weeks after the Executive said that it

"will take a financial interest"—[Official Report, Written Answers, 13
June 2000; Vol 7, p 78.]

in PUK, but the minister is unable to tell us today whether the Executive
has the money to substantiate that claim, because the source of the money
has yet to be identified. Have we got the cart and horse the wrong way
round, or are we not yet out of the stable?

Mr McConnell: Not at all. It was very important to notify the Parliament
properly in early June that the Executive intended to take a stake in PUK.
Without the clear agreement of ministerial colleagues and without a clear
proposal being put before the committee about where the money was coming
from, it would be wrong for me to say that we would take 7 per cent, 8 per
cent or 10 per cent in the organisation. We intend to take the 10 per cent
maximum stake as soon as possible. The proposal before the Scottish and
Westminster Parliaments this week is the quickest and most efficient way to
do that. The process follows the proper conventions in that both
Parliaments give their assent to it. That is the right way ahead for the
Scottish Parliament and PUK.

Mr Swinney: Can I encourage you to acknowledge the parliamentary issues
that I have raised? The ministerial answer on 13 June might perhaps have
been more complete if it had contained a reference to parliamentary
consideration.

You mention the value-for-money tests that have been applied to the East
Lothian and Midlothian schools projects, the Glasgow City Council schools
project and the Scottish Tourist Board e-commerce project. What were the
value-for-money comparisons against which these projects were judged?

Mr McConnell: I do not have that detail with me today, but I will be happy
to provide it before Thursday afternoon.

John Henderson (Scottish Executive Finance Division): Glasgow City Council
was persuaded that it wanted the support of the new organisation because it
had had support for its secondary schools project from the Treasury task
force, which is the body that Partnerships UK is replacing. That
support—and the individual involved—will now be part of PUK. In a
sense, the value-for-money test centres on the track record of particular
individuals in providing help; it is a scientific process, like a public
sector comparator. Public authorities make judgments on the basis of the
track record of individuals in helping to get other projects started.

Mr Swinney: Although I appreciate Mr Henderson's comments, I am concerned
that the minister is telling us that a value-for-money exercise must be
embarked upon to justify PUK's support for the development of projects when
in fact the decision comes down to the judgment of public authorities.
Public finances will be involved to some extent in any of those projects
and PUK's fees will have to be paid out of public sector funds, whether a
project is based on e-commerce or on a council's refurbishment of a school.
I want to know a little bit more about the extent to which assessments of
the competitive offering of partnerships are undertaken. Although I
appreciate that judgments are made about individuals, what is PUK's
judgment process and will any public sector body be able to choose projects
that it likes, without any due process?

Mr McConnell: I will make two points in response to that. First, the
situation has little to do with whether the Scottish Executive has the
legal authority to take a stake in Partnerships UK. The proposal that is
before the Scottish Parliament this week is that it should do so. We are
not asking whether individual Scottish public bodies wish to use the
services of Partnerships UK—which will exist whether we have a stake in
it or not.

Secondly, it is important that we do not try to misinterpret or turn around
words that are used carefully in the committee. I said that the judgment
was about value for money for each of the public bodies that are involved.
Mr John Henderson has explained clearly what that judgment can be—and has
been—based on. Nobody has suggested that there was some numerical or
calculable exercise or test. Different public bodies will have their own
ways in which they make such judgments and account for them. For example,
the accountability of those judgments would be different for the local
authorities that might use Partnerships UK than it would be for the bodies
that are largely or partly funded by the Scottish Executive as agencies,
departments or non-departmental public bodies.

It is important that we are clear that different bodies are accountable in
different ways. They will not all be directly accountable to me for the way
in which they decide—or do not decide—to use Partnerships UK. It is
important that when we debate the motion this week, we debate whether
Scotland should take a proper stake in a body that will exist anyway and
that will—whether we influence it or not—provide services to Scottish
organisations. My view is that we should be involved and that we should
influence it positively.

Mr Raffan: In paragraph 5, you mention the type of Scottish project that
Partnerships UK will support. In the conclusion, you say that a range of
Scottish PPP projects will receive PUK support. Will you indicate the
criteria that will be used to decide whether a project goes for PUK
support?

Mr McConnell: Mr Swinney addressed that point. Projects will choose where
to go for support based on the advice and support that they need to
progress and whether the advice and support from Partnerships UK is better
than that which they would receive elsewhere. The four bodies that have
already made that decision have done so on the basis of experience and,
presumably, other factors. That is a decision for them, which they will
have made after due consideration.

Mr Raffan: You have kind of answered my question, but what I was trying to
get at is that the Executive will have a minority stake of 10 per cent and
will, I presume, have some influence on whether a project seeks
Partnerships UK support.

Mr McConnell: Having a stake in PUK is not necessarily the same as
influencing Scottish projects or bodies to use it. Although the matter
involves public-private partnerships and there is therefore no private
interest with which the Executive would have conflict, it would not be good
for us to exert such influence. It is important to ensure that every
project decision whether to involve Partnerships UK is made on its own
merits. It should not be made under any undue influence or pressure from
the Executive. We should not, on the other hand, tell a project to pull
back from PUK support.

Mr Raffan: It might be my ignorance, but I am not clear what the great
advantage of the proposal is to us. A 10 per cent shareholding of between
£1 million and £2 million might be one of the cheaper concepts the
minister has brought before us, but what advantages will it bring? Are
interest rates likely to be lower because PUK is backed with a minority
stake from the Treasury?

Mr McConnell: If we take a stake in this, we will have a better say in the
running of the organisation and a proper stake in its success. That is good
news for the Executive. It would be wrong of us to try to duplicate in
Scotland such a skills base and resource. It would be a waste of our
resources. It is a skills base that is already used by Scottish PPPs in a
different form, at a UK level, through the Treasury task force. It is
important not only that that is maintained, but that it is developed and
improved. If we have a direct say and a stake in the success of that
organisation, it will be better for Scottish public services.

Mr Raffan: I see that point, but will you address directly my point about
cheaper loans? Will the fact that the Treasury is still involved, as there
is a heavy Treasury stake in this, lead to cheaper loans?

Mr McConnell: The purpose of PUK is not to provide loan finance; it is to
provide professional support and consultancy services. It will part-fund
the professional costs of establishing and setting up PPPs. That money will
return to the stakeholders in PUK as the projects develop. Its purpose is
not to provide loan finance.

Mr Raffan: I did not say that it would provide loan finance—obviously it
cannot with its relatively small budget of £20 million—but will it
facilitate that?

14:30

Mr McConnell: We hope that the advice that PUK would provide would ensure
that projects are delivered with the most cost-efficient loan finance and
other packages that are provided. That is part of ensuring that the proper
professional advice is available for those who are running the projects.

John Henderson: I will give the committee an example of the benefits. When
several local authorities are taking forward individual schools projects to
the markets and to the banks, they are not likely to get a good financial
deal. PUK hopes to bundle several of these school projects together to
ensure that they can go to the market at a similar time in a form that is
attractive to the market.

It is interesting that the East Lothian schools project is one that PUK
wants to back. Rather than taking an individual school, it is taking a
group of six schools. It is an ambitious project for an authority of that
size, but with PUK support there should be some benefits in terms of
financing.

Mr Raffan: Similarly with the massive proposals relating to Glasgow.

Mr Davidson: I trust that the minister did not arrange for the
parliamentary question to be planted by Mr McNeil so that you could trail
your record to the Parliament.

You have talked about the Executive taking up to 10 per cent of the total
package. That is not in proportion to the Scottish percentage of the UK
population. What is the linkage in the percentages between what we put in
and what benefit we may receive?

Mr McConnell: If there were any payback to those who have shares in PUK, we
would get back what we put in, in percentage terms.

Mr Davidson: So is it perceived as a profit-making organisation?

Mr McConnell: No, the intention is not to make profits; it is to ensure
that the proper advice and support is available for PPPs across the UK.
Where costs have been incurred by PUK, the intention is that those costs
will be recovered from the individual projects as the life of the project
goes on.

John Henderson: PUK will be a plc. There will be a return, a profit if you
like, to those investing in it, but because the mission of the plc is a
public mission, the private sector will get back the cost of their
capital—a reasonable return on their capital—but they will not get any
profit element above that. Similarly, for the public sector share there
will be a potential dividend.

Mr Davidson: I accept that. The question was on the back of how I
interpreted the minister's response. However, the minister has not answered
in respect of the relationship between population and investment. If it is
a UK body, I thought that you would have aimed for a standard UK input. Do
we expect to get much greater support from this organisation than the rest
of the UK?

John Henderson: It might be helpful if I explain that some of the criteria
that PUK will examine when judging whether it wants to back projects will
be whether the projects are large, difficult and replicable. Can it add
value? It will not necessarily be looking at it from the perspective that
it must have a project from Scotland and one from Manchester, one from
Wales and one from Northern Ireland. It will consider projects against its
criteria.

It so happens that there is a reasonable representation of Scottish
projects in the first group of projects that PUK is supporting. The next
time that it considers which projects to support it might decide that there
are more Scottish projects or fewer Scottish projects, but I do not think
that every time it chooses a project it will examine a grid that says,
"Scotland must get 9 per cent."

Mr Davidson: You will understand why I asked that question, Mr Henderson.
On that statement a per capita amount means that you have just joined the
UK club, which sounds quite reasonable.

Mr McConnell: It is also important to remember that if Scottish projects
are defined as projects that exist in Scotland, they will not necessarily
only be projects that are run by the Scottish Executive or bodies that come
under the devolved responsibilities. The Ministry of Defence, the Inland
Revenue or other UK Government departments could be running PPP schemes
relating to buildings or infrastructure in Scotland.

It is not impossible that even the substantial involvement of the
innovative Scottish projects that are already receiving advice and support
through the mechanisms that will become PUK could be expanded upon by
Government departments' having innovative PPP schemes that happen to be
based in Scotland. I do not think that the geography of a project is a
criterion for its receiving support. It is important that, across the whole
UK public sector—in which we have a direct interest through the Scottish
Executive's responsibilities—we are able to use the organisation to our
best advantage.

The percentage is not based either on population or on the number of
projects. It is a round percentage that allows us to have a stake. It was
not chosen to represent a particular amount of projects by the Executive or
by anybody else. It was not chosen because of the Scottish population
share, although it is not far away. The share of the population itself
would not necessarily meet the criteria because, for example, the number of
civil servants employed by the Executive is about a quarter of the UK
total. The Scottish Executive is one part of the overall Government machine
which is much wider in its responsibilities and its financing.

Mr Davidson: I will finish with two brief questions. First, how will PUK be
benchmarked? Secondly, if we did not join in, what would we lose out on?

Mr McConnell: I do not know about benchmarking. Mr Henderson may be able to
help with that. On the second question, if we do not join in, we lose an
opportunity to have a say and a stake in an organisation that will have an
impact on and that will be a positive support to Scottish public
infrastructure developments over the next few years. I think that we should
take that opportunity, and that is why the proposal has come forward.

John Henderson: On the benchmarking question, only a quarter of projects
will, in due course, have the support of Partnerships UK. The other three
quarters will not. The acid test will be to ask what value has been added,
whether the PUK projects have got to the market more quickly and whether
they have saved money for the public sector. If they fail that acid test,
public bodies will be aware of the benchmark and will decide not to use the
projects.

Andrew Wilson: David Davidson's point strikes me as reasonably important.
We appear to be taking one fifth of the entire UK public sector stake in
PUK. This is straightforward arithmetic: 10 per cent is one fifth of 50 per
cent—or of just under 50 per cent. Given that our population share is
half that—we are taking double our population share—and given what the
minister has just said, that the Scottish Executive civil service share is
a quarter, four times our civil service share, why is the Scottish
Executive so important as part of the public sector's share in PUK? Is it
because the Executive is overexposed to private finance compared to the UK
average?

Mr McConnell: Both those calculations are wrong. The 10 per cent figure
relates to the 49 per cent. Our maximum share under the proposal would
therefore be 4.9 per cent. That is clearly a different calculation. My
example of the number of civil servants was to show that, although the
majority of schemes currently under consideration or construction in
Scotland are the responsibility of the Scottish Executive and its related
agencies, and of local government, there are also Government departments in
Scotland spending a lot of money and using a lot of public buildings and
infrastructure. They include the Department of Social Security, the MOD,
the Inland Revenue and the United Kingdom Passport Agency.

Those departments may choose, sometime in the future, to be involved in PPP
schemes to improve their infrastructure, buildings or equipment. If they
are involved—they presumably have projects that Partnerships UK would
wish to support—that is in addition to any Scottish Executive-supported
or devolved responsibility-related PPP scheme. That is why I do not think
it possible to take a straightforward population comparison, although the
10 per cent figure is not far from the Scottish share of the UK
population.

That is not, however, the point. The geography of the schemes and the share
of population is not the same as deciding the share of the devolved
responsibilities and comparing that share with that of other public
expenditure in Scotland, and it is not the same as the criteria that PUK
will use.

Andrew Wilson: I am grateful for that. The 4.9 per cent does not appear in
the memorandum that we have before us. That is the source of the
misunderstanding that David Davidson and I share.

Mr McConnell: As I said, 10 per cent of 49 per cent is 4.9 per cent. I am
sorry if that is not clear to all members of the Finance Committee.

Andrew Wilson: It is apparent that, until we meet on Thursday to decide on
the matter, you are not clear where the financing is coming from, Mr
McConnell. You are asking Parliament to sign up for a commitment to spend,
although we do not know where the money is coming from. Perhaps it is
coming from the contingency fund, but who knows? We are deciding on
something that we cannot influence.

You said that we will have some influence on the advisory committee, but it
has not yet been decided at which level. How can we sign up to something
when we do not know what influence we will have? You told us that we will
be consulted on the composition of the board, but not represented on it.
Given the fact that the UK public sector will make up a substantial part of
the board, why are you not seeking to have a more substantial and direct
influence on the board?

Mr McConnell: I have already explained the last point. Being consulted on
the composition of the board is better than having as a token
representative someone who happens to have been born in Scotland. However,
if the best people to be on the board were all Scots, that would be good.
It is important that we are consulted on the composition of the board
through our share in Partnerships UK. It is also important that we do not
decide in advance the level of our representation on the advisory board. As
a stakeholder, the Executive will make that decision in due course.

I thought that I made this clear earlier and I apologise if I did not speak
clearly enough for all members of the committee. It is important to stress
that this week's decision will give the support of the Scottish Parliament
to the decision that can be taken in the Westminster Parliament to include
the clause in its bill. That would give the Scottish Executive the power to
take a stake in Partnerships UK. That is not the same as deciding the exact
nature of our involvement; it is giving us the power to do so. That is the
motion that is before the Scottish Parliament this week and I hope that
that is the basis on which the motion is considered. Clearly, any decisions
on the budget of the Scottish Executive will go through the normal
procedures that this committee has agreed.

It is important to have the power in advance. We will not make a final
decision on the amount of our stake until we have the power to make a stake
in the first place.

Andrew Wilson: I am grateful for that answer. We are being asked to sign up
for something without knowing how it will develop. When will we hear when
we will have to commit financial resources and from where they will come,
given that the organisation was launched recently?

Mr McConnell: Having the choice to take a stake in the organisation does
not mean that we will have to. We will have a choice. As I have confirmed,
the Executive intends to take up the opportunity and will decide the nature
of the stake based on the resources that we have available. We have always
said that that would be up to 10 per cent. We will involve the Finance
Committee in that decision.

Andrew Wilson: Am I right in saying that the organisation exists?

John Henderson: The organisation exists as a wholly owned Treasury company.
It does not exist in the form in which it will exist after the UK
legislation receives royal assent, if it does.

Mr McConnell: The UK Parliament has to pass legislation before Partnerships
UK can exist in its final form, which is why we are trying to legislate to
secure a stake in the organisation.

Andrew Wilson: That would imply that the Executive's decision on the
composition of the board would have to have been reached before the board
was appointed. From this discussion, it is apparent that no one knows when
that decision will be made.

John Henderson: It is likely that the launch of Partnerships UK will be in
the autumn.

Andrew Wilson: But we do not know whether that will be before or after the
end of the recess.

Mr Swinney: We also have a written answer that says that the Scottish
Executive

"will take a financial interest in Partnerships UK".—[Official Report,
Written Answers, 13 June 2000; Vol 7, p 78.]

Mr McConnell: I have not made any secret of that fact. I have been saying
for weeks that the Scottish Executive has a clear intention to take a
financial stake in the organisation. However, we will not pre-empt the
power that we do not yet have—although we will have that power once the
legislation is in place—or the financial decisions that will lead to our
taking that stake and its exact amount. The Executive should make such a
decision rationally and then follow the normal procedures through the
Parliament. We are not going to be bounced into that in advance by
questions of the sort that I am being asked today. We will make the
decisions in a normal, rational way and we will involve the Finance
Committee in line with the powers and agreements of this Parliament.

14:45

Andrew Wilson: On 13 June, you made a commitment to take a financial
interest and today you have outlined that that interest will be of the
order of £2 million. However, you have still not said where that money
would come from.

Mr McConnell: You are criticising me for not being specific about the
amount and then you are criticising me for saying where it is not coming
from.

Andrew Wilson: That is the point. You are the Minister for Finance and we
are the Finance Committee—that is our job.

The Convener: No dialogue, please.

Mr McConnell: We have to be sensible about these things.

Andrew Wilson: Exactly.

Mr McConnell: Convener, I think that it is important that I have the chance
to answer questions from the committee when they are asked.

It is important that the Executive should seek the power and state its
intention clearly. We have done that in the normal way, through a
parliamentary question on the day that the organisation was launched so
that there would be no doubt in the Parliament about our intentions. We
have been fully involved in all the discussions leading up to the creation
of Partnerships UK. Scottish public sector bodies are benefiting
substantially from the kind of expertise that will become Partnerships UK
in its final form.

We intend to take a stake, but we will take a decision on the level of that
stake at the appropriate time. We will do so in such a way as to continue
the good dialogue that we have with the Treasury and those involved in
Partnerships UK, including the chief executive who will be in Scotland
tomorrow for further discussions. That body, our involvement in it and
those who are represented on the board will be decided in the normal way
but with the full involvement of the Scottish Executive. That is a good
thing for Scotland. I hope that, this week, the Scottish Parliament will
support that as something that would be beneficial to people in Scotland in
securing the infrastructure improvements across the public sector.

Rhoda Grant (Highlands and Islands) (Lab): In reply to a question from
Keith Raffan, you said that it would be possible for a local authority to
attract funding for several projects together. Could PUK take a bundle of
projects from different local authorities—even from Scotland and England
together? One of the problems in the Highlands and Islands is that the
projects are very small, which makes them unsuitable for PPPs. Could PUK
help that difficulty by enabling the Highlands and Islands' projects to
attract PPP funding by being grouped with other projects?

John Henderson: That is the intention. Projects should be able to be
grouped together, provided that the local authorities are happy with that.

Mr Adam Ingram (South of Scotland) (SNP): Minister, you emphasise the
importance of having a stake, to allow the Executive to have a say in PUK
decision making. Precisely what decisions are you talking about having a
stake in?

Mr McConnell: The board of PUK would determine the strategy, allocate
resources and support individual projects across the UK. Our involvement in
that is very important. As a devolved Administration, the last thing that
we want to do is to separate ourselves from good UK developments that are
of direct benefit to the public sector in Scotland. The work of the
Treasury task force on PPP projects has been extremely beneficial to
elements of the Scottish public sector over recent years. We should be
involved in order to ensure that that benefit continues.

Mr Ingram: For the sake of argument, if the Scottish Executive wanted to
bundle together a series of PPP projects on road building and put that out
to PUK for assistance, are you suggesting that the Executive's stake in PUK
could make a difference by ensuring that the projects would get support?

Mr McConnell: That would not be the purpose of having a stake in PUK. There
would be a conflict if we were to try to influence matters in that way.
What is important is that PUK would decide on individual projects on their
individual merits, and that the bodies—whether the Executive or anybody
else—that bid for PUK support would do so on the merits of that support
for each individual project, not because of some other financial
relationship between them and us.

Mr Swinney: I have a simple, almost blindingly stupid, question for the
minister. Do you want PUK to be successful?

Mr McConnell: PUK will be successful. We want to be involved to ensure that
that success is of the maximum benefit to Scotland.

Mr Swinney: But do you want it to be successful?

Mr McConnell: The answer is obviously yes.

Mr Swinney: If that is the case, I am confused by the answers that you gave
to Keith Raffan. If you want PUK to be successful—and finance from the
Scottish Executive is going into it—you must have a commercial interest
in its success in attracting projects. Will the Executive be passive, or
inactive, when it comes to encouraging local authorities and
non-departmental public bodies to take their bids to PUK or some other
venture? Will you encourage them to approach PUK, or will you encourage
them to go somewhere else?

Mr McConnell: That depends on how you view success. The success of a body
such as PUK, which is being established with a public sector mission to
support public sector projects that will improve the public sector in
Scotland as well as elsewhere, will be judged on the improvements to the
public sector infrastructure that it is able to support and develop. That
is different from commercial success, which is what you are referring to.
My interpretation of success is slightly different from yours.

Mr Swinney: The question that I am driving at is whether the Executive will
be active in encouraging public bodies in Scotland to take up an
involvement with PUK.

Mr McConnell: The Scottish Executive would provide information on the
support that could be available from PUK for Scottish public sector bodies.
However, we would want those bodies to make their own decisions, based on
what was best for them. If they felt that they wanted to pursue support at
that level, they would be able to make that choice. Any suggestion that we
would want to force anybody into involvement with PUK would be wrong.

Mr Swinney: I have one final question. Is there any legislative constraint
that would have stopped the Scottish Executive from forming a venture of
this type, in which the Scottish Executive could have had a 49 per cent
stake and the private sector in Scotland could have been the 51 per cent
stakeholder?

Mr McConnell: I am not aware of any such constraint. The economies of scale
and the spread and continuation of skills that we can benefit from, as a
result of PUK being a UK body, far outweigh the merits of a Scottish
option, which is why we are strongly recommending our involvement in PUK
rather than the creation of a Scottish alternative.

Mr Swinney: I am a bit perplexed by that answer. Since 13 June, a
substantial number of projects have been contemplated, such as schools
projects in East Lothian and Midlothian, the refurbishment of primary
schools by Glasgow City Council and an e-commerce project for the Scottish
Tourist Board. As there is a critical mass of projects, the direction for
leveraging investment into capital projects for the public sector should be
the PPP route. Adam Ingram mentioned road building; there is a substantial
amount of activity in that area. I doubt that the argument based on
economies of scale is justifiable.

I also doubt the argument about expertise. From my knowledge—which is
based on the evidence that this committee has heard and on wider
experience—I am certain that, within the public and private sectors in
Scotland, a critical mass of expertise exists to give support and direction
to public infrastructure projects in Scotland. Did the Executive consider
that as an option in this process?

Mr McConnell: Yes, of course. The Scottish Executive decided that it would
be best to take part in Partnerships UK, although great skills exist in
Scotland, which have developed projects that you and others have criticised
constantly. I am sure that many of those projects would not have taken
place without the commitment of skilled people in Scotland. That skills
base will be expanded by virtue of the organisation covering the whole of
the UK. The continuity that comes from the work of the Treasury task force,
which has been of great benefit to Scottish PPP projects in recent years,
is worth retaining. We have made a judgment in that respect. This option is
better than the alternatives and can only continue to benefit the Scottish
public sector. Ultimately, what matters is the provision of good-quality,
efficient public services in Scotland. That is the criterion that we have
used to make our judgment, which we stand by.

Mr Davidson: My question is simple. Is an exit strategy available to any
future Executive? I ask that on behalf of my colleagues, John Swinney and
Andrew Wilson.

Mr McConnell: Your colleagues who might not want to build the buildings or
the roads.

Mr Davidson: It is a serious question. You are talking about a long-term
commitment.

Mr McConnell: I presume that if we take a stake in the organisation, we
will always have the option of withdrawing that stake. My hope is that we
can be part of a successful operation, which can continue to benefit us in
the future. However, like any other Government decision or venture that
seeks to improve the way in which we provide and finance facilities in the
public sector and to develop contract management skills, the operation
should be continually reviewed and improved as the years go by.

The Convener: We should keep this in perspective. We are talking about
maximum spending of £2 million. It is not exactly macro-economics.

Mr Davidson: That is at this stage, convener. The base of the question is
whether the commitment is open ended. Should there be a further call on
funds, will the minister have to come back to Parliament? If the Scottish
Executive of the day decides that this is not value for money or that it
has not set up the standards that you wanted, is there a way out? That is a
simple question.

Mr McConnell: I assume that, if we make an investment, we can also withdraw
it. I also assume that, if there were ever any change to the amounts, that
would have to go through the usual parliamentary procedures. The point that
I keep coming back to, in this committee as elsewhere, is that decisions on
budget allocations in Scotland are essentially made by the Parliament. They
are recommended by the Executive but members have some control over the
process and would be involved if circumstances were to change.

Elaine Thomson (Aberdeen North) (Lab): Presumably one of the purposes of
PUK is to help projects that seek PPP finance access the financial markets
and money. Is that all, or is its role also to assist a project all the way
through, from planning to implementation? That kind of financial expertise
is extremely specialised and many organisations and companies use it on a
UK-wide basis rather than a Scottish basis simply because that is more
cost-effective. The task force and PUK have presumably been set up because
previously proposed PPP projects have had difficulty in accessing the
required finance and were having to pull in the necessary expertise from
the private sector, perhaps very expensively. Is that one of the reasons
behind the setting up of the organisation?

Mr McConnell: Certainly one of the reasons is to ensure that people do not
have to rely on expensive alternatives and that they have a pool of
expertise. Expertise is not discovered overnight, but it can be built up
over a period of time. The expertise already exists, but it will be built
on by the creation of Partnerships UK. The activity of Partnerships UK will
be far more diverse than simply financing PPPs—it will involve all the
other professional skills that are required to set up a successful project
and see it through. Those are an important range of skills, which I am sure
can be used across the whole of the UK—not just here in Scotland—and
used well.

Andrew Wilson: We are aware of the principles that the minister is
outlining, but I want to touch again on the budget allocation. With the
greatest respect, convener, £2 million might not seem a great deal, but it
is a quarter of the Tayside University Hospitals NHS Trust overspend for
next year, so it is a significant sum in some quarters. Given that there is
no allocation for or even mention of this in "Investing in You", are we to
assume that the funds may come from existing underspends?

Mr McConnell: No, you cannot make that assumption. That decision will be
made and reported to this committee through the normal procedures. It will
be considered during the current spending review, and we will report to the
Finance Committee in the normal way.

Andrew Wilson: Are we correct to assume that there will be an allocation
from the Executive budget in the coming financial year?

15:00

Mr McConnell: I hesitate to be repetitive in front of the committee. I hope
that everybody can follow exactly what I am saying. The Executive has a
clear intention to take a stake in Partnerships UK. That is in the
interests of the development of good public infrastructure in Scotland. We
will make a decision over the coming weeks and months about the level of
that stake. That stake will then be considered through the financial
procedures that we have agreed with the Finance Committee in terms of any
alterations to existing budgets or projected budgets for future years.

Andrew Wilson: My second question is on the body itself. The public sector
will be taking a significant shareholding. The private sector will have a
51 per cent shareholding. Will the staff who are employed by PUK come from
the private sector or the public sector, or will there be a mixture? What
protections or safeguards do we have if there are conflicts of interest
between the companies with a shareholding interest in PUK and the place
from where the staff have been recruited?

Mr McConnell: All the normal legal provisions will apply to conflicts of
interest. That will ensure that those interests are safeguarded. My
understanding is—and John Henderson will correct me if I am wrong—that
the staff of PUK would be employed by PUK, and not by anybody else.

John Henderson: That is right. They would be employed as employees of
Partnerships UK, whether they come from the private or public sector. They
will be engaged on the basis of their skills. It will be up to the board of
PUK to decide internally, as the minister explained, which projects they
want to support. On the public sector side, it will be up to the public
sector whether it wants to ask for PUK support.

Andrew Wilson: To be clear, we are talking about an organisation that has
full-time staff and does not make use of consultancy services.

John Henderson: That is correct.

The Convener: I will take one more question, from John Swinney. We have
given this a good go.

Mr Swinney: Can individuals representing private sector interests be
members of the board if their companies are tendering for contracts that
PUK will decide on?

Mr McConnell: I am not sure of the exact provisions.

John Henderson: If that situation were to arise, there would be a clear
obligation on the individuals to say that there was a conflict of interest
and not to take part in any decisions.

Mr McConnell: I would have thought that the same obligation would apply to
the Scottish Executive, the National Assembly for Wales or the Northern
Ireland Assembly in relation to any consideration by the board that might
have an impact on projects that we were sponsoring directly. On conflicts
of interest, the same provisions should apply in the public sector as in
the private sector. We must have a situation in which conflicts of interest
do not occur.

Mr Swinney: Where will the details be fleshed out? This will be a private
company, so will there be regulations that specify how it is to be
operated? Will it be possible to apply constraints beyond the regulations
of the Companies Act 1989?

John Henderson: Like all companies, it will be subject to the Companies Act
1989. It will also have a memorandum and articles of association, which
will be made available. One would expect the memorandum and articles of
association to set out how the board would deal with issues such as
conflicts.

Mr McConnell: We would be happy to ensure that the committee has early
sight of those as soon as they are available.

The Convener: I thank the minister and Mr Henderson for answering
questions. The committee is required formally to note the motion. Can I
take it that the committee will do so?

Members indicated agreement.

Scottish Parliament Building Project

The Convener: The last item on our agenda is a report from Ken Macintosh,
who is our reporter on the Holyrood project. On behalf of the committee, I
would like to record our sadness at the premature death of the architect
responsible for the Holyrood project, Enric Miralles. None the less, the
project will go on and it would be helpful to hear your report, Ken.

Mr Macintosh: This is the update that we agreed it would be appropriate for
me to give before the recess. I associate myself with the convener's
remarks. Obviously, my report has been overshadowed by the death of Enric
Miralles. Whatever we feel about the management and costs of the project,
we can all pay tribute to the vision and imagination that the architect
showed in his design. We can share the view that has been widely expressed
today that the Parliament will be a fitting memorial to him.

The most significant development for my role in monitoring the costs of the
project so far was the debate in the chamber on 4 April, when spending on
this project was capped. We will find out in retrospect whether the
Spencely report was the turning point for the management and monitoring of
costs of the project, but at the moment it seems that it was.

The other significant development was the agreement to set up a progress
group. I had some concern that there was a hiatus in the establishment of
that group but, as members will be aware, it is now up and running. Its
first full business meeting was going to be today, although I do not know
whether that has gone ahead, in view of the death of Mr Miralles.

The progress group has three political representatives from across the
parties and four professional representatives. I think that we can all be
reassured, because the progressing group, unlike the Scottish Parliamentary
Corporate Body, has been set up with the sole responsibility of monitoring
the progress and costs of the Holyrood project. We can also take
reassurance from the fact that the flow of information since the
establishment of the progress group has been far greater than before. That
allows us to be aware of what is going in with the project.

It was agreed in the debate in April that stage D of the project would be
signed off. It was signed off about two weeks ago. That underlined a
particular stage in the development of the project. It marked a stage in
the development of the plans, which has implications for the overrun of the
project.

There has been substantial progress. Two matters are outstanding. The
project director, Barbara Doig, has moved back to the Executive, and the
project is currently appointing a new director. It will not be a direct
replacement because the role of the project director has been changed
slightly. Applications for the post are being considered. The appointment
will be another important stage in the continuity of the project.

Possibly more important for my reports to the committee will be the report
of the Auditor General, Robert Black. His report, which we had expected
this month, will now come out in September. The report was commissioned by
the Audit Committee, which agreed that it was more important that he carry
out a thorough examination of all the costs of the project to date rather
than try to meet a deadline that might not be practicable.

That is us up to date. I intend to use the summer to further my inquiries
with the new project team, the progressing committee and the Auditor
General. I will report back as soon as practicable in the autumn.

Mr Davidson: Can Mr Macintosh assure us that at some stage he will refer to
the Holyrood project's impact on the budget? I thought that that was his
principal role.

Mr Macintosh: I can certainly promise that. What I did not particularly
want to do was to duplicate work that was going on elsewhere. There has
been a far greater flow of information to all MSPs and to this committee,
which we can all be reassured by. What I have provided today is merely an
update; when I have more material of substance—how much has been spent to
date, how much is projected to be spent, which budget the money comes from
and any potential impact on other areas of the budget—I will bring it
back to the committee.

Mr Davidson: I am grateful for that. Could we have that information
circulated in the form of a written report before a future meeting?

Mr Macintosh: Certainly. What I have provided today has been very much a
brief update. However, you are right; I have not had a chance to draw up a
proper report for the Parliament. Indeed, I did not particularly want to do
so in advance of the Spencely report and, in particular, the Auditor
General's report, as he is investigating these matters in a slightly more
professional capacity. Although I will produce a proper report, that will
not be before the Auditor General reports to the Audit Committee in
September.

The Convener: Andrew Wilson has a question. I ask him to bear in mind the
fact that we have to be out of here by 3.15 pm.

Andrew Wilson: First, I want to thank Ken for his report.

Mr Macintosh: It was an update.

Andrew Wilson: Sorry, update. However, with the greatest respect, I
understood that our specific focus was not on management issues but on the
impact of the project on the budget. We have yet to see any specific
reference to how the budget has been altered to accommodate changes that
were announced in the Holyrood project over the past few months. That
information is urgently needed.

Secondly, I thought that, given the fact that our job is specifically
financial, the reporter's remit was to examine the impact of financing the
project over four years and whether the most sensible approach had been
adopted. We still do not have that information at our disposal. Perhaps the
reporter could and should have considered the issue early on.

Mr Macintosh: I will take those comments on board. I agree that my remit is
very specific—to monitor costs and their impact on the budget is very
specific. Those elements will be part of my report. As I said, this has
been very much an update and I have not wanted to duplicate work that is
going on elsewhere, particularly by the Auditor General and in the Spencely
report. The issues have been fully debated by the Parliament and I will
provide a weightier report later in the autumn.

The Convener: It will be worth waiting for.

That concludes the formal business on our agenda today. I want to refer to
a couple of minor items. First, at last week's meeting of the conveners
liaison group, our request for external research was approved; that will
now go out to tender over the summer. The Scottish Parliament information
centre has some suggestions about whom we might use. Although we are not
asking for specific suggestions just now, members should let the clerks
know if they have any.

Secondly, on Friday 21 July, George Souris, leader of the National Party of
Australia in New South Wales, will visit the Parliament between 2.30 pm and
3.30 pm. If any committee member could be here for that, they would be very
welcome. Perhaps David Davidson is most likely to have political
connections with that party.

Mr Davidson: I am sorry. I am away.

The Convener: It is not a handy date. However, I hope that other members
will bear the visit in mind. It is important that we try to maintain links
with similar bodies in other parts of the world.

Finally, I want to thank members for their contributions to the committee
over the past year. I think that we have been an extremely effective
committee and I am sure that we will build on that after the recess. In the
meantime, enjoy the break and come back refreshed; I look forward to seeing
you all in September. I also thank our current clerks and those who have
moved on to other things for their support over the year.

Meeting closed at 15:14.


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