Constitution, Europe, External Affairs and Culture Committee [Draft]

Meeting date: Thursday, June 20, 2024

Official Report 700KB pdf

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Review of the EU-UK Trade and Co-operation Agreement

Our third agenda item is an evidence session as part of the committee’s inquiry into the review of the EU-UK trade and co-operation agreement. We are joined online by Angus Robertson, Cabinet Secretary for Constitution, External Affairs and Culture. He is joined from the Scottish Government by Frank Strang, who is the deputy director for European relations, and Nick Leake, who is the deputy director of the European Union office.

I invite the cabinet secretary to make a short opening statement.

Thank you for the opportunity to speak to the committee today and to exchange views on the implementation of the trade and co-operation agreement, which has been an important focus of Scottish Government work since the agreement came into force on 1 May 2021.

I very much welcome the committee undertaking such a wide-ranging inquiry into the treaty’s implementation and hearing evidence from a range of witnesses. From the evidence that you have taken so far, it is clear that the Scottish Government’s priorities coincide, in many cases, with the priorities of stakeholders in business, education and civil society.

A large part of our work in recent months has been to interact with as many stakeholders as possible, including the UK domestic advisory group and the Scottish advisory forum on Europe. We are keen to ensure that we hear what they say and gather evidence from their expertise.

It is particularly timely for the committee to be carrying out this work at present, because we expect the review that is provided for in the agreement to take place in 2025-26, although it is not yet clear whether that will lead to consideration of substantive changes. The elections this year, in both the European Union and the UK, might also lead to new scenarios and to opportunities for improvement.

I turn first to the big picture. The Government strongly affirms that Scotland shares the EU’s vision of peace and co-operation; the founding principles of the European project are universal and are rooted in a belief in human dignity and freedom, expressed through democracy. We also share Europe’s global challenges and are determined to work together on shared solutions. The war in Ukraine, the conflict in Gaza and the continuing threat of climate change make the scale of the global challenges very clear.

Scotland voted clearly to remain in the EU, with majorities for remain in every local authority area in the country. Despite that clear democratic expression, the UK Government’s hard Brexit has been imposed on us, leading to many of the difficulties that your inquiry has already brought to light.

It is welcome that we have seen a modest improvement in the EU-UK relationship in recent months. It is overwhelmingly in Scotland’s interest for there to be a much more positive and mutually beneficial relationship between the EU and UK, and we will do our part to help to create that where we can.

As members know, the Scottish Government is committed to maintaining alignment with the EU, where such alignment is possible and will be meaningful in protecting and advancing the high standards that we share.

We continue to be a proactive and constructive participant in EU matters by engaging closely with TCA fora and by wider engagement with EU institutions and member states, including our active network of international offices and our support for inward visits here at home. For example, I had the pleasure in April of welcoming the EU ambassador for a busy programme of engagement with Scottish stakeholders. The Scottish Government is thereby doing everything that it can to mitigate the damage of a Brexit that Scotland did not vote for, minimise divergence with the EU and ease Scotland’s eventual return.

I turn to the priorities that the Scottish Government has identified in its work around the TCA, after which I hope that we can discuss our respective approaches to the challenges that we see.

I will focus for a moment on the higher education sector, which is so crucial to Scotland’s economy, society and reputation. Scotland benefited disproportionately from the horizon Europe and Erasmus+ programmes. We are pleased that, in January this year, the UK finally associated to the horizon Europe programme. Collaborating internationally is vital for our education and research institutions, and the Scottish Government has continually urged the UK Government to find a pathway back to horizon. We now need to ensure that we maximise Scottish participation in the programme, and I am pleased that work on that has already begun.

One of the fundamental rights in the EU—that of free movement—offered unique opportunities to our young people while we were in the EU. The Erasmus+ programme was a key element of that, and we have been strongly urging the UK Government to re-associate to the programme. We welcomed the recent proposal of the European Commission to open negotiations with the UK Government on youth mobility. I can only hope that that issue will receive fresh consideration after the UK election.

The committee has already heard about many other issues, which the Scottish Government also sees as important priorities and which include a sanitary and phytosanitary agreement and other trade easements, enhanced mobility arrangements for services and creative professionals, and electricity trading and wider energy co-operation, through which Scotland’s hydrogen sector has so much to offer.

There is no doubt that we have the technical knowledge to address all those issues. What we need is a change in mindset and to move to a place of trust where we can do business together.

I look forward to discussing with the committee those issues and other matters that members might wish to raise.

Thank you very much, cabinet secretary. I open with a question regarding evidence that we heard during the inquiry from businesses, all of whom told us about a structural disadvantage in exporting to the EU, in relation to added costs and the time involved. It became clear that larger exporters and organisations were much better placed to absorb those costs than small and medium-sized enterprises, which we also met and visited.

The Scotch Whisky Association told us that

“It is much easier for companies if they know what the requirements are—even if there is a bit of a burden in that—than if their product lands at a port in the EU and is held there while people run around trying to find a document that has been asked for, which they were not expecting”,

and that, although “those issues have reduced” for exporters,

“they have not completely gone away.”—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 8 February 2024; c 21.]

The Scottish Government is limited when it comes to the workings of the TCA and its review, but what are you and agencies such as Scottish Development International doing to support Scottish businesses, particularly SMEs, in trading with Europe? In what ways has your approach changed since the TCA came into play?

The first thing to state is the obvious, which you have already heard from those who have given evidence to you: the TCA is a significant step backwards in our economic and trading relationship with the EU compared with the benefits that the UK enjoyed as a member state.

The evidence that you have heard in the inquiry has illustrated that already. Brexit has generated bureaucracy, costs and delays and created complexity for Scottish businesses. There are barriers to trade, which have exacerbated recruitment challenges and held back investment on a significant scale. The UK economy is now 2.5 per cent smaller than it would have been in the EU, and the gap could increase to 5.7 per cent by 2035.

Things can be done, which Scottish Enterprise—the national economic agency of the Scottish Government—deals with, as do Scottish Development International and our colleagues in the Scottish Government office in Brussels. There is a constant effort to work out how we can ameliorate the challenges. However, there is only so much that can be done.

Our relations with the EU are a matter for the UK Government, which sought a hard Brexit. We now have a hard Brexit and hard consequences. We will do what we can around the edges—we will perhaps come to that when we discuss the TCA, with very specific examples of where slight improvements might be sought.

On the big picture, though, unless the UK seeks to rejoin the European single market or join the European Union as a whole, we will continue with all these disadvantages. We will work together with business and with exporters and importers as much as we can, but there is no getting round the hard facts: Brexit is Brexit; it is bad; and it will continue to be bad.

Thank you, cabinet secretary. I move to questions from committee members, starting with Mr Ruskell.

Cabinet secretary, I want to ask you about regulatory alignment with the European Union. Regulations very rarely stay still—they often change and evolve over time—but now that we are out of the room with the European Union, we are no longer part of the process of developing and improving them. Is there now the potential for more of a UK consensus on regulation, and, if so, is there any possibility of a divergence from European Union standards and regulations?

It is very much a moving target. With certain things, it would make sense for the UK to align itself with European standards. A current example of that would be energy, given Scotland’s significant potential in renewable energy and exporting it either as electricity or as hydrogen-related products such as ammonia or hydrogen itself. Those things require regulatory agreement with the European Union, and that currently does not exist.

As a result, we in the Scottish Government need to impress on UK Government colleagues in the current and probably outgoing Government—and I hope that those in a likely incoming UK Government are listening to this—that we require regulatory agreement and alignment on this issue, so that we can reach our full potential. We are not in the room, so we are having to ask others to act on our behalf, which they might or might not do. They might have other things that are a higher priority. However, I am doing everything that I can to communicate to decision makers in London, Brussels and other EU national capitals, particularly those such as Berlin with an interest in the likes of energy importation, that, with goodwill, we could be in a win-win situation.

If anything, this issue underlines why not being in the room is a disadvantage. If we are to use the TCA mechanism—which we will, because it is the only formal structure that we have—all I will get is an occasional meeting with a junior minister in the Foreign Office, as has been the case up until now; they will sit and listen; they will say that they are hearing what we are saying; and then they might or might not act. We are able to observe what happens—as I have, having sat in on meetings with Maroš Šefcovic and the previous UK Foreign Secretary, and having seen certain issues that we had impressed on the UK Government as important being raised, while other issues were not.

We are going through a number of stages here. We might be listened to, we might be heard and then things might or might not be acted on. We are beholden to others acting on our behalf, and their having good will and an understanding that what we have raised might be a good thing. We might come on to this later in the evidence session, but I can highlight the recent example of a proposal with regard to the reintroduction of free movement for younger people, which would be a good thing—

We will come on to that a bit later, I think.

Okay—fine.

You have highlighted a good example of where there would be common interest in aligning with European Union regulations. I suppose, though, that I am interested in the Scottish Government’s position of maintaining alignment with the EU and how that might differ from a UK position.

Perhaps I can give you an example. Next week, a statutory instrument on persistent organic pollutants is coming before the Parliament. The EU is looking to phase out such chemicals, but on a very strict timescale—that is, by 2027. The position of the UK and Scottish Governments is to take a slightly weaker regulatory approach and not to phase out those chemicals by 2027. It is a niche bit of environmental policy, but that is a clear area where the Scottish Government is taking a position not to align with EU policy. I am not asking you to comment on the merits of that—I am sure that we will come to that in the Parliament next week.

09:15  

Is that an example of where all that regulatory development work is being done within the UK—it is about agencies and regulators working together with industry—but, because that does not involve the European Union, there is potential for divergence? That is a clear area where, if that statutory instrument is passed next week when it is presented to the Parliament, there will be divergence from the EU position. I do not know whether you understand my point there—

I do understand the point that you are making.

The committee has looked at that a number of times. There might a desire to stay broadly aligned, but there could be a creeping divergence because you are just not in the room in the European Union so you are not really part of the consensus on how regulatory policy develops further.

We have a colleague, who is joining me virtually, who is on the front line of that in Brussels. We have an office in Brussels that works with European institutions to be aware of European Union regulations and proposals, as far as is possible. We look across the piece of those and we try to work in a way that allows us to maintain our alignment with the European Union, as far as is possible.

You will have to forgive me, because you will appreciate that hundreds and hundreds of different proposals are brought forward and you have not invited me today to speak about the specific issue that will be discussed more next week. However, with regard to the generality of the matter, the Scottish Government, its office in Brussels and our agencies are working with a view to remain as closely aligned as we can and to avoid significant divergence between Scotland and the European Union. That is the aim of the Scottish Government. There will be examples where that is not the case but, with regard to the generality—the direction of travel—that is the policy of the Government, and we are doing as much as we can.

I think that Mr Ruskell and other committee members will be aware that we have been working closely with the committee clerk to ensure that members are informed about how that is done and that there is a reporting mechanism to the Parliament on alignment. That is a work in progress, but we want to ensure that the committee and parliamentarians are informed, as much as is possible, about those alignment efforts.

Do you want to bring your official in on that as well, Mr Robertson?

Nick Leake, would you like to add something?

Just to support what the cabinet secretary said, the EU legislative process starts at the beginning of a new five-year cycle—you can see that the new five-year cycle is just starting now—when the Commission President, who we think will be appointed at the end of this month, sets out her guidelines. The next thing that we will see is a work programme that the Commission will produce at the end of this year or the beginning of next year, which will set out legislation that it will propose over the year to come. We try to track those proposals as they come through. Our best chance of influencing those proposals is before the Commission has made them, so we talk to people at that stage as well.

Once the Commission has made a proposal, we try to track it through the European Parliament and Council but, as the cabinet secretary said, there is a heck of a lot. We are doing our best to get on top of it as much as is possible.

However, is that not very high level? When it comes down to individual laws and a choice about whether to align with the EU, where are you in the policy process? It seems that what is happening right now is that you are sitting down with UK counterparts and making a decision about whether you stay aligned on very specific pieces of legislation. I am interested in how you are also talking to the EU Commission about your aspirations around alignment, how you might stay aligned and how you bring those aspirations into those four-nation discussions in the UK about regulations and change.

It is a good question, and it will be a question over time. I have a couple of things to say on it. It is not just about quantity and how many regulations; it is about what matters most. It is about standards and focusing on the standards that really matter to us, to help us choose. We are not just ticking boxes—well, we are ticking boxes, but we are also thinking about the things that matter in terms of standards.

The other thing that I wanted to say is that it is often good to think about the dog that does not bark, if that is the way to put it. I am thinking of retained EU law and the sunset clause, because, since we last spoke, we have been pretty active down in Westminster, working to help to remove the sunset clause. You are absolutely right, Mr Ruskell, but it could be a whole lot worse—there could have been a more automatic removal of EU law if we had not managed to do that.

I will briefly move on to the horizon programme, cabinet secretary. It was good to understand that the Scottish Government will now promote the opportunities that can come from horizon. Will you say a little bit more about what that will involve? Is it about working with the higher education sector? Is it about the Scottish Government showing leadership with particular research institutes and trying to galvanise potential projects that could come through horizon? I am interested in the roadshow and what is being planned.

Having called for the longest of times for the UK Government to rejoin horizon—incidentally, and perhaps we will come on to this, having also done the same for Erasmus+ and the creative Europe programme—it has now moved very much into the academic and research space, as Mr Ruskell has already identified. I must confess that that is not my area of responsibility in Government. I appreciate, as I think that he and committee members do, how important horizon is to the university sector, but my education and higher education colleagues will be in a much stronger position to answer that.

However, I know that it is being taken very seriously and that the opportunities are very significant. Having spoken to university administrators, including at Edinburgh university, I know how much they welcome a return to the horizon project. That underlines our view that it is necessary to continue the process by rejoining Erasmus+ and the creative Europe programme.

I move to questions from Alexander Stewart.

Thank you, convener, and good morning, cabinet secretary. In your opening statement, you touched on the challenges that are faced. As you have identified, we have met a number of organisations, agencies and businesses during our inquiry, and they have talked about navigating those challenges and how adept they have become at managing the situation. It has been difficult—there is no doubt about that.

We have heard from various sectors about how they have had to change and adapt to ensure that they can navigate through the difficulties that they have found, but many have managed to do that, because of the response and support that they have received. It would be useful to hear from you about how the Scottish Government and its agencies have been supporting export businesses to navigate the new trading arrangements with the EU and about whether their work to find equilibrium has been and continues to be supported by the Scottish Government and its agencies.

Scottish Government agencies will always do whatever they can to support the Scottish export sector. The responsibility for the UK border regime lies with the UK Government. The Government that has responsibility for policing border arrangements—literally—is the UK Government. This is a very clear example of where we will try what we can to ameliorate problems. Scottish Enterprise, Scottish Development International, the Scottish Government agencies, and the Scottish Government itself, which regularly meets representative organisations and exporting companies, will do everything that we can to ensure that unnecessary red tape or barriers to trade are removed.

A good example of that—one of the biggest prizes, short of rejoining the single market and the European Union—would be to have a comprehensive SPS agreement. I know that this area is like acronym soup—it involves a lot of technical language. In effect, that would mean having what is known in common jargon as a veterinary agreement. My understanding is that such an agreement would reduce the necessity for about 90 per cent of cross-border checks, were there to be such a thing. I think that I am right in believing that the current and outgoing UK Government does not agree that there should be an SPS agreement. My hope, which has been communicated publicly, is that, were there to be a new and different UK Government, it should aim for an SPS agreement—a veterinary agreement—which would make export and import much easier.

So, in short order, the responsibility for a hard Brexit, for borders and for Brexit red tape is the UK Government’s. It owns it. It has delivered it. It said that it would be an improvement. It is not. We will do everything that we can to reduce the damage that Brexit has caused, but it will only ever be at the margins. The only way that we can obviate that damage is to rejoin the single market and the European Union; everything else will only ever make a marginal difference. We are outside the European Union now, which means that those barriers are there. Nothing will change that, short of rejoining the single market and/or the European Union. I am in favour of doing both.

Good morning, cabinet secretary. You mentioned the evidence that the committee has heard during its inquiries. At various points we have heard about jobs being lost and businesses going bust, virtually overnight, or stopping exporting. In some cases businesses have been taken over by their now parent companies in other countries, including Germany. We have also been told by someone—I forget the name of the chap who gave evidence; I think that it was a guy from Northern Ireland—that the UK was becoming the most expensive place in the world to do business. Witnesses have told us that it is now easier to do business with North Korea than with EU countries.

Given all those impacts of Brexit, and what you said might happen in a couple of weeks’ time, when I think that most people would assume that we will be looking at a different UK Government, do you have a prepared list of asks for it? Things could be done—before you say it again, I know that they will only happen at the margins—that would improve the situation both for people in Scotland and for businesses. Whoever is elected, a fresh set of eyes will be coming on to the issue at Westminster, so have you a list of early demands and requests that you think could help to improve things in Scotland?

The Scottish Government has been doing preparatory work for a potential change of UK Government. It is prudent to do so. Unsurprisingly, that work involves a list of improvements that are reachable, which include rejoining Erasmus+, for educational co-operation; rejoining Creative Europe, for cultural co-operation; and reaching agreement with the European Union on a mobility agreement. We saw a recent proposal from the European Commission that that should be reintroduced and, essentially, that there should be a reset on relations with the EU. Some straws in the wind have suggested that a changed UK Government might take a different view. This week, we saw commentary on chemical regulations, in which the UK Labour Party suggested that it was prepared to take a different view of matters. We will be making a very strong case that a reset of relations with the European Union is a high priority for the Scottish Government.

09:30  

However, to underline the point that Mr Brown has made, those are still, in the round, only going to impact on the margins of our relations with the European Union. The UK will not be in the room, it will not be at the table and it will not be co-determining European policies. The UK will remain outside the single market and will continue to operate in a Brexit—a hard Brexit—environment. That is the policy of the UK Labour Party as well as the UK Conservative Party.

I would not want people to get their hopes up that there will be a massive reset, such that the trade barriers will be reduced. In some respects, we run the risk that some barriers will be heightened, because the UK Government has yet to implement its border regime in its entirety and we do not yet have clarity from the Labour Party on whether it will do so. If it does, I think that we can look at there being additional problems in relation to our trade with the European single market.

On Northern Ireland, we already have evidence that its situation of being able to operate within the UK single market as well as the European single market is to its benefit. Traders in Northern Ireland have seen their exports grow, not only to the United Kingdom and the Republic of Ireland, but to the European Union. They are able to benefit from—I think that I am quoting the UK Prime Minister and his predecessors here—having the best of all worlds. Unfortunately, Scotland does not.

I understand the point that there is no prospect of an incoming UK Government looking again at Brexit. In fact, I think the Labour Party has now said that it will never return to the EU. However, I think that it is still incumbent on the Scottish Government to make as much progress as is possible, even though I can see that it will be at the margins.

I wonder about what is often called “soft power”. I remember being embraced physically once by a senior member of the Christian Democratic Union in Berlin, who said, “We like our Scottish friends”, and that they did not want us to leave them. I think that people have underestimated the extent to which personal affront was taken by people in the EU over the conduct over the Brexit agenda. That opens up an opportunity, if we can get the right relationships. It will not affect the processes, but having the right attitude from people—a positive view of Scotland—is very important. What are you able to do in that space to try to help things along?

That is a really good example. What Mr Brown points to is correct. It is my experience, when meeting with European decision makers, whether in national capitals or in European institutions, that there is a very strong predisposition towards Scotland as a pro-European nation and a wish to be as helpful to Scotland as they can be.

A very good, concrete example of where we have an opportunity to make the most of that is the energy question that I alluded to in response to Mr Ruskell. I do not think that it is widely reported here that the German economy is going through one of its most significant transitions since the industrial revolution. Germany is moving away from a reliance on hydrocarbons—in particular, Russian gas—and toward fuelling its engineering-based economy with hydrogen. It is doing that right now. However, Germany is unable to provide its indigenous industry with the amount of renewable energy, in the form of electricity or hydrogen, that it requires, so it will need to import that. Scotland and our northern European neighbours can be a big part of the answer.

When I speak to German decision makers, as I did recently in Berlin, they tell me that they are really keen to be able to import—to buy, so it would be a benefit to the sector in Scotland—hydrogen and hydrogen-related products as soon as possible. For that to happen, we will require interconnection between Scotland and Germany, and we will require the UK Government to reach regulatory agreement with the European Union relating to that.

To Mr Brown’s question, then, I would say yes, there is massive goodwill and massive interest, but our relationship is determined not just by our direct contacts. Indeed, that is one of the reasons for our having a strong external affairs approach—we are trying to maximise the opportunities that we have through the goodwill that exists for Scotland—but we are still relying on a UK Government with reserved powers in relation to these energy questions to land that success for the energy transition in Scotland.

We will do everything that we can to prepare the way. We will say to UK Government ministers, “This is a huge opportunity. Please, can you act?”, and I have impressed that on the outgoing Government and will be impressing it on any potential incoming Government. After all, the Germans are acting, regardless of what we do in Scotland and the UK. Either we can be at the forefront of this energy transition on the European continent or we can miss the bus, and it will be decision makers in London who will ultimately determine whether that is the case.

I wish that that were not so; I wish that we could just get on with this ourselves; I wish that we were in the EU; I wish that we were able to agree the regulations ourselves; and I wish that we were able to make progress on the subsea interconnector, which involves powers that are currently reserved. However, we cannot. We will do what we can, but ultimately it will be UK ministers who will determine the speed and the success of this happening. If it fails, they will bear the responsibility for that.

That was my last question, but it is just worth mentioning in passing that the best example of non-Governmental soft power that I can think of is what we are seeing just now with the tartan army in Germany. Scotland’s reputation is being hugely boosted by their conduct.

Good morning, cabinet secretary. I want to go back to the issue of guidance and support for businesses as they navigate new trading arrangements and, indeed, the whole issue of trading. You have said on a number of occasions that the Scottish Government is doing everything that it can, but how is it evaluating whether it is doing that? You mentioned support from Scottish Enterprise, Scottish Development International and Scotland house in Brussels, but how is the Scottish Government evaluating the effectiveness of its support for small businesses so that it can back up its claim that it is doing everything that it can? What future changes will be made on the back of any such evaluation?

I am at the convener’s discretion here, because, as I think Mr Bibby knows, there will be two evidence-taking sessions this morning, the second of which will relate to the Government’s international network and its evaluation. If the convener wishes me to speak to that in this evidence session, I am happy to do so, but would you prefer that I did so in the next evidence session?

I am going to leave it to Mr Bibby to decide.

I think that the point about support for small businesses to navigate the trade arrangements is very pertinent to this evidence-taking session.

That is fine. I am happy to say all of this twice, if Mr Bibby would like me to do so.

First, in relation to the network that he mentioned, we have a network of Government offices in nine locations, the majority of which are in Europe. In European Union capitals, we have Scottish Government offices in Dublin, in Paris in France, in Brussels, in Berlin and in Copenhagen. In addition, SDI staff are located throughout Europe, and both work in concert to ensure that opportunities are pursued and companies supported.

A very good example of that—which I will raise in the next session, too—is a case study that relates to efforts in France to support Scottish exporters. That activity involved the Scottish Government office there and the SDI network working together, and the evaluation has been able to show that one event alone secured more than £5 million-worth of export orders. The network is therefore working very hard to ensure that it supports businesses small, medium and large, and it is not just the Scottish Government offices that are involved, but the SDI network, too. There are trade envoys as well—Madrid is another European capital where we have a presence—and the GlobalScot network feeds into that process, too.

Evaluations take place in Scottish Enterprise, which is ultimately responsible for SDI, and the Scottish Government’s network of offices also has an evaluation process. We have begun annual reporting: one annual report has already been published, and the one for this year is forthcoming.

We will come on to talk about evaluation at greater length in the next evidence session. I know that the committee has been looking at that and that you took evidence in Dublin about how the Irish Government does it. If there are any suggestions about how we can better supply the committee or others with information about evaluation, I am keen to hear them, because we should be rightly proud of how hard our offices and international network work to promote exports and inward investment.

On supporting businesses and providing guidance to them, is the Scottish Government considering more direct intervention measures, such as the establishment of a dedicated advisory board or a helpline for exporters? We have heard some suggestions about that in evidence sessions. We have talked about supporting small business and we heard that the Scottish Government is doing everything that it can. Is the Scottish Government considering other measures? What more can it do to help businesses to navigate the new trading regime?

I and colleagues are always open to suggestions. There is an on-going dialogue with Scotland’s business organisations, which constantly feed back their experience about what is or is not working well for them. If there are any gaps in that provision, I am certain that people would be keen to hear what they are.

There is dialogue and regular discussion about all those things and I very much hope that suggestions are acted on—none have been brought to my attention that have not been. Mr Bibby or the committee might have examples of areas where there is room to improve. That is a good example of the purpose that inquiries such as this one serve in trying to make a difference where we can, notwithstanding that I hope that there is an appreciation that we are operating in a hard Brexit environment, which the Conservative Party and the Labour Party support.

May I come in on that, convener?

Yes, Mr Strang.

The question about feedback, continuous improvement and support is a really good one. The best measure, of course, is sales and outcomes. I want to allude to what the cabinet secretary said about the Scottish Government and SDI’s work in Paris. There was a St Andrew’s day activity there last year, on which we made a real effort to get feedback from all the UK and Scottish companies that were present at the embassy. The firms forecast £5 million of sales—that figure has not actually been secured, but it is forecast. All that I am saying is that the proof of the pudding is in the sales, so that is what we are trying to measure more and more.

How involved has the Scottish Government been over the past year or so with the specialised committees that have been set up to support implementation of the UK-EU trade incorporation agreements?

Regular dialogue takes place between Scottish Government officials and their UK Government counterparts. In general, that does not involve ministers from meeting to meeting. Those are technical discussions that take place across a range of specialist subject areas. However, I found that there was an improvement in the pre-TCA meeting dialogue between me and Leo Docherty, when he was Parliamentary Under-Secretary of State for Europe. I had two meetings with him in relation to technical discussions on seed potatoes and other issues that the committee will be well aware of. There was definitely a marked improvement in how those discussions went. That reflected the fact that, in the discussions between officials, the message had been heard.

09:45  

There are a number of subject areas in which there are technical areas—on seed potatoes, bivalve molluscs and so on—where, with good will, one might be able to make progress. In those areas, discussions have been held between officials, and then between me and my ministerial opposite numbers. There were also discussions on cultural performers and the restrictions that they are facing with cabotage and so on that have made things difficult for touring professionals.

The dialogue happens. In some respects, the situation is better than before. There have been more meetings than there were previously, and I know that some of the issues have been raised, but that is not the same thing as actually being able to deliver in relation to them. In that regard, we discuss where there are shortcomings. We have discussed the issues on seed potatoes, bivalve molluscs and touring professionals, which are three high-priority areas for us to try and get some progress on. UK Government ministers have said that they have heard our concerns and will raise them. We are allowed to view those discussions with the European Union, but we are not allowed to take part in them ourselves.

To date, on those specific examples, we have not yet got the outcomes that we are looking for. There is a system that brings our officials together and now brings ministers together, but we really need to look at outcomes and not just processes. The processes are better than they were. That is definitely the case, although there is still significant room for improvement. However, with regard to outcomes, there is still some way to go.

The reason why I raised the issue is that, in the letter that you sent to the committee before today’s meeting, you stress that those specialised committees represent one of the primary opportunities to influence the implementation of the TCA. Given that that is the case, I question the frequency of the meetings. Seventeen of the 18 specialised committees met only once in 2023, and the fisheries specialised committee met only twice. Could those meetings be more frequent, or should a case-by-case approach be taken?

There are a few points to make about the specialised committees. First, they are all relatively new, but some were set up later than others. I am not in a position to talk about issues with the frequency of the meetings—my officials might want to say whether they have a particular view on whether that has been problematic. To be honest, I think that the challenge was to get the specialised committees established in the first place. Now that they have been established, they have to find a rhythm to what they do. I am not in favour of having meetings for the sake of having meetings. I generally believe that issues that need to be discussed should be raised when they need to be.

There might be an issue around how often the specialised committees meet and whether they meet often enough—I think that that is the nub of your question. I am not sure that we are going to be able to answer that yet—I see that Nick Leake would like to comment, and I will let him in in a second. I had a concern around the fact that, for quite some time, a significant number of the specialised committees had not met at all. It seemed to me that, if it was thought that it was important to establish those specialised committees, it was pretty important that they should at least have an initial meeting and then discuss what the rhythm of their meetings should be in future.

Now that the committees have largely been established, we are in the next stage of working out whether they are meeting as often as they should. It is definitely the right question, but I do not have an answer to that in the round, Ms Gallacher. However, I am as keen as you are to know whether that is indeed the case. I think that that will become more apparent now that the committees have initially met. Nick, do you have some additional information on that?

The cabinet secretary is absolutely right. The UK-EU relationship has improved, which means that those structures, which should have been set up earlier under the TCA, are starting to function properly. The theory is that the partnership council tells the specialised committees what to do. If there is a particular area of focus for the partnership council, it would make sense for the relevant specialised committee to meet more often than some of the others. Setting up those meetings does not replicate going to the working groups, but it establishes contacts and relationships between experts in the Administrations, which will be really important to delivering outcomes in the future. However, it will take time to function properly.

As with alignment, it is about quality and not quantity. What worries me about infrequent specialised committee meetings, although I do not really have a view on the frequency, is that the work is done between them rather than at them. The work is done in the corridors. It is really important for us that the forums in which we can be present are of high quality rather than quantity, if you see what I am saying, so that things are not stitched up in advance. The question for me is whether the real issues are coming to those committee meetings or whether the actual discussion is happening elsewhere.

That is really helpful. I thank you all.

I do not think that committee members have any further questions. Cabinet secretary, I will finish by coming back to you on a few points that we have covered. You talked about the offer from the Commission on youth mobility. It is always worth emphasising that, in European terms, that means people who are aged under 30, so that is a big offer to the UK on the mobility of young people and opportunities that are so important for education but also for other areas. You expressed your hope that that offer will be revisited.

However, it would be remiss of the committee, given our full title, not to examine the culture sector and the problems for touring artists, particularly for our traditional artists and those who want to go to Europe but are now finding it prohibitively expensive and are therefore losing out on bookings across Europe. Can you provide a little more information on what Creative Europe membership would mean for our artists, if it were to happen? Would it solve the issues for our touring artists?

Creative Europe is much more programme oriented. It is not the same as restoring mobility for all young people, which would include all younger people who are interested in creative pursuits. We need to appreciate that being part of Creative Europe is viewed as very important in the creative and arts community—the established creative and arts world. However, wider mobility is the big prize for all young people, including those who are just curious to travel in order to live, learn and experience.

In the wider sense, that mobility would fundamentally ease the issues for our younger artists and particularly our breakthrough artists, for whom being able to travel and tour in mainland Europe was always seen as an essential part of their career development. Many have reported that they are unable to travel or that the costs are prohibitive, so the offer of free mobility would increase their chances of career development.

The prize is there, and the good news is that the offer is still there, too. The offer is there for both. I know that, because I went to the Commission and asked. It said, “This is not one of those areas: if the UK said that it wished to be part of programmes like horizon, that would not be viewed as cherry picking.” Therefore, although I would wish it to be otherwise, even if the UK was to remain outside the European single market and outside the European Union proper, being part of Creative Europe and a mobility agreement is on the table, and I think that it should be grabbed with both hands.

That was very helpful, cabinet secretary.

Finally, the review of the TCA will take place in 2026, as you said, so the committee’s inquiry is indeed timely. However, given the current trading environment between the UK and the EU, what challenges might our small businesses and SMEs trading in Europe face over the next two years?

The challenges are everything that we have learned thus far because, as far as I am aware, the big picture is not going to change. There is no substantive difference between the two main UK political parties that are standing in the current general election in relationship to the European Union. Neither is suggesting that we rejoin the European single market or rejoin the European Union itself, which means that the hard Brexit will remain just that.

As far as small and medium-sized businesses—and, indeed, all Scottish exporters—are concerned, there needs to be an understanding that the big picture is not going to change with a pro-Brexit British Government. The Scottish Government will do what it can at the margins, because that is the only area where we can have an influence, given that we are outside the single market and we have this hard Brexit arrangement. We will beat the drum and we will make the case, but it remains a fact that, under a Conservative Government or indeed a Labour Government, the UK and Scotland as part of it will have hard Brexit done to us, regardless of the fact that we did not want it to happen in the first place. The damage to our economy and our exports will, unfortunately, remain in place, even though I would wish it to be otherwise.

Of course, there is another option, which is to rejoin the European Union, and that is still a debate that is being had in Scotland. I am sorry that it is not being debated among the UK parties, but the Scottish Government’s position is still that we would wish to rejoin the European Union as a member state, which would obviate all these issues.

Thank you for that, cabinet secretary. It is worth noting that I and the previous deputy convener, Donald Cameron, have attended frequent Parliamentary Partnership Assembly meetings and that a lot of the priorities that we have talked about this morning are also its priorities and have come up for discussion there, such as SPS, youth mobility, carbon trading and security. The PPA is, of course, the link between Westminster and the European Parliament and its MEPs. In that respect, I think that there is a shared interest across the UK, even if it is not being shown by the Government at the moment, in the priorities being set with the Commission.

Thank you for your attendance, cabinet secretary. I will suspend the meeting for about five minutes before we move on to the next agenda item.

09:58 Meeting suspended.  

10:04 On resuming—