Scottish Parliament, 7 November 2002

383 contributions from 75 members. The official report.

Introduction

Housing

Murray Tosh (Conservative, South of Scotland)

Good morning. The first item of business is a statement on housing by Margaret Curran. The minister will take questions at the end of the statement, so there should be no interventions.

Margaret Curran (Labour, Glasgow Baillieston)

Last year saw the passage of the Housing (Scotland) Act 2001, which is one of the most radical pieces of legislation that the Parliament has passed. The implementation of the act is well under way and is bringing about many improvements to Scottish social housing. We have funded 21,000 affordable houses since 1999 and the ballots that have been conducted will result in 100,000 council homes being transferred under the community ownership policy, which will lead to £2 billion of investment in the next 10 years. The recent Homelessness etc (Scotland) Bill is further proof of our determination to tackle head on the housing and social problems that have beset Scotland for generations.

Excellent progress is being made on many fronts. I intend to describe how, in a number of important ways, we plan to build on what we have already achieved. The measures that I will announce underline our commitment to social housing. They will offer greater diversity in the available options for landlords and tenants. In all our housing policies, we put tenants' interests first. The best way in which to do that is to give tenants a real say in the decisions that affect their homes, and we remain firmly committed to that objective. At the same time, we want to improve the efficiency of the sector and we will work with local authorities to improve the way in which they carry out their investment and management.

Through constituency work, members of the Scottish Parliament are well aware of the poor state of some council housing and of the impact that it has on those who live in it. Too much of our social housing is not up to the standards that we should expect a modern country to provide. I believe that we lack an objective national quality standard that covers all our social housing. Such standards have been established in England and Wales and around 20 Scottish local authorities have established their own standards. The Chartered Institute of Housing in Scotland and Shelter Scotland recently called for a standard.

I believe that it makes a great deal of sense to have a standard and I propose to consult local authorities, registered social landlords and others on the development of a new Scottish standard for social housing. As part of our consultation, I shall take the views of social landlords on what is a realistic target date to meet the standard and what interim milestones should be set. We want the setting of the target date to be informed by the Scottish house condition survey, which is under way and which will report next year.

We want local authorities to take account of the new standard in the local housing strategies that they are preparing and we will discuss that with them further. When the information is to hand, I will invite councils and RSLs to submit their plans for meeting the standard and how that will be funded. I will describe in a moment the new funding mechanisms that will be available. The development of the new standard will be tied to the housing improvement task force's work.

The whole-stock transfer of council housing remains the central plank of our housing policy. Transfers provide the necessary investment to bring social housing up to the new standard and to put tenants at the centre of the decision-making process. Debt write-off remains available only for whole-stock transfers and is a result of our partnership with HM Treasury to secure considerable investment resources for social housing in Scotland. For many authorities, transfers will be the only way in which to lever in the necessary investment and to get that sooner rather than later. Transfers will also remain the most effective use of the Executive's resources because of the investment that they unlock.

It is important that we ensure that funding for housing achieves the maximum effect and provides the best value for money. Transfers are still the best way forward for local authorities to regenerate council housing. For example, in Glasgow, £1.6 billion will be invested in the next decade to provide every tenant with a warm, dry, affordable home. That level of investment would have been impossible if tenants had not voted for change.

Considerable progress has been made on the current transfers. We have learnt a lot and the time is right to apply those lessons to ensure that the transfer process works as speedily and as efficiently as possible. Therefore, we will review and consider improvements to the transfer process to help councils to proceed with future transfers as effectively as possible. In doing so, we will consult widely in the sector.

Stock transfer already brings many benefits, but I want to consider how we can further incentivise local authorities to go down the transfer route. One area in which we can do more is in linking the investment from housing transfers with wider community regeneration efforts. We will consider ways in which other spending can be made available to local authorities to complement housing transfers as part of comprehensive area renewal. I will announce the outcome of the review and details of the use of resources in January.

The benefits of whole-stock transfers are self-evident; the benefits of partial transfers that receive new housing partnership funding are less evident. We want councils to reach strategic decisions that cover all their houses. The NHP bidding process has perhaps not always led to the most effective use of the limited resources that are available. Therefore, I have decided that there will be no further NHP bidding rounds for partial transfers. Councils will still be able to seek funding from Communities Scotland for partial transfers if they form part of a strategic local housing strategy.

Although community ownership delivers a raft of benefits, it is becoming clear that, for some local authorities, transfer is not necessarily the only option in their circumstances. Representations have been made to me suggesting that we must offer those authorities something other than a choice between transfer and the status quo. I have considered those representations carefully and, as a result, I can announce that I intend to bring local authority housing capital finance within the new prudential regime that has been announced for the rest of local authority finance.

That means that, in future, local authorities will decide for themselves what is an affordable and prudent level of borrowing in their financial circumstances. The change will take effect from April 2004, subject to the passage of the Local Government in Scotland Bill. The move to a prudential regime for housing will not change the choices that face authorities that have significant debt levels, high investment needs and high rents. For them, stock transfer will remain the best option.

I stress that the point of the prudential regime is to delegate to local authorities decisions on prudent levels of borrowing. It will be up to individual councils to decide what, if any, additional borrowing the prudential regime might permit, but our estimates suggest that the prudential regime might release £200 million of extra investment for Scottish council housing. At the end of the day, councils will need to take full responsibility for their housing debt. They must ensure that the debt remains at manageable and affordable levels and that it does not place an unsustainable burden on current or future tenants.

As happens at present, borrowing will have to be funded out of rents, which means that, in setting borrowing limits, councils will need to ensure that rents are kept at responsible and affordable levels. I want local authorities to take a more businesslike approach to planning their housing investment and I will work with them on that as part of the move to the prudential regime.

I also intend to change the arrangements for funding local authority expenditure on private housing. We plan to replace borrowing consents with grant assistance that will be earmarked specifically for private sector housing purposes. We will consult the Convention of Scottish Local Authorities on the details of those changes. The total resources for expenditure in the area, including the implementation of the housing improvement task force's work, will be £215 million in the three years to 2005-06.

From my discussions with councils, I am aware that many of them have innovative ideas for alternative funding mechanisms and for different ways in which the housing stock might be managed. It would be worth while for us to explore further with councils whether those and other approaches can be developed in the Scottish context. I am not being prescriptive about the alternatives, but to be worth while, it must be shown how they can promote improved tenant involvement, deliver the necessary investment and support effective and transparent management. As part of the consultation on the new quality standard, I propose to invite local authorities and others to suggest innovative approaches that satisfy the criteria that I have just set out.

One specific issue that we must discuss with local authorities is the treatment of capital receipts and the set-aside rules. The move to a prudential regime means that the current rules must be revisited and are unlikely to remain relevant. We will take councils' views on that when they have considered the full consequences for their finances of moving to the prudential regime.

The changes that I have proposed will tackle Scotland's housing-quality problems head on. They are a major evolution in housing policy that builds upon and complements the central policy of community ownership.

We have listened to local authorities as they have tried to find ways to tackle their housing problems and we are working in partnership with them to deliver a better deal for tenants. We have answered local authority calls to provide other options for many of the issues that we face. I look forward to answering members' questions.

Murray Tosh (Conservative, South of Scotland)

The minister will now take questions on her statement. The list of members who wish to ask questions is lengthening, so I shall allow around 30 minutes for questions. We will move to the next item of business at about 10:15.

Kenneth Gibson (Scottish National Party, Glasgow)

I warmly welcome the minister's statement and thank her for providing me with a copy of it in advance. In its plans to adopt a Scottish social rented housing standard, the Executive is following the lead of the SNP, which adopted that policy at its annual conference this year—although we are clearly further advanced than the Executive on the issue as we already have a timetable in place for its introduction. Similarly, the Executive's intention to extend the prudential borrowing regime to housing was whole-heartedly endorsed by the SNP in Inverness, and we agreed the issue of grants last month. However, the grant assistance over three years that the Executive proposes is half the level, in real terms, that new Labour inherited.

Murray Tosh (Conservative, South of Scotland)

Will you come to the questions now?

Kenneth Gibson (Scottish National Party, Glasgow)

Yes. We usually have a preamble.

Murray Tosh (Conservative, South of Scotland)

No—

Kenneth Gibson (Scottish National Party, Glasgow)

I seem to remember Mr McLetchie being given plenty of leeway when he is speaking.

Murray Tosh (Conservative, South of Scotland)

Mr McLetchie has not spoken this morning—you have. A lot of members want to speak and I would be grateful if you could come to your questions.

Kenneth Gibson (Scottish National Party, Glasgow)

There seems to be one rule for one member and another rule for others.

Murray Tosh (Conservative, South of Scotland)

Order. Come to the questions, Mr Gibson.

Kenneth Gibson (Scottish National Party, Glasgow)

Over what period does the Executive intend to consult local authorities on its new-found flexibility over housing capital receipt set-aside? Local authorities with low debt burdens must be relieved of that as soon as possible, if the Executive decides to proceed with abolishing housing capital receipt set-aside.

Does the Executive plan to restore the 30 per cent cut in the Communities Scotland approved development programme, which is now running at £100 million less than it was when new Labour came to power?

Taking into account the concern of the Social Justice Committee that the future supply of affordable housing will not meet the rising demand, will the minister assure us that the Executive will be able to meet Scotland's housing needs fully, given the record level of homelessness over which the Executive now presides?

Margaret Curran (Labour, Glasgow Baillieston)

Kenny Gibson raises a range of issues. I hope that the Presiding Officer will allow me to respond to the preamble that was not quite a question, as I feel obliged to address some of those issues.

Mr Gibson referred to the SNP conference, which seems to have been an interesting experience. The conference passed a resolution that all stock should be located in attractive environments by 2013. That is an interesting policy, and I look forward to the SNP's definition of an attractive environment. The SNP conference also resolved that housing improvement and repair grants should not be means tested. I will be interested to see the implications of that for the Scottish housing budget and the grants that the party intends to introduce.

I made it abundantly clear in my statement that we intend to consult local authorities on a variety of issues. We will be flexible in doing that. I will have serious discussions with local authorities and, as I have said, I will come back to the Parliament in January with a series of announcements about where we are with that. The prudential borrowing regime will not be introduced until April 2004, and the housing capital receipt set-aside rules will not be changed until then. That gives us enough time to have proper consultation.

There are huge issues about resources, which have been debated many times. The acts of the Labour Government at Westminster and the acts of the Labour-Liberal Democrat coalition have introduced substantial increases in the housing budget and in housing supply. We have been honest about the challenges that exist in Scottish housing and we are facing up to them today. It has been the biggest reinvigoration in housing for many generations, and we have fundamentally addressed the issues of resources and supply in increasing the budgets.

Lyndsay McIntosh (Conservative, Central Scotland)

I apologise for not quite being ready. The minister was very quick off the mark this morning.

Margaret Curran (Labour, Glasgow Baillieston)

It is not like me.

Lyndsay McIntosh (Conservative, Central Scotland)

Yes, it is. The minister is very fast.

On behalf of the Scottish Conservatives, I welcome the minister's statement and thank her for the courtesy of sending me an advance copy of it.

Although the Conservatives believe that home ownership is something to which most people aspire, and we proved our commitment to that aspiration by introducing right-to-buy legislation—one of our greatest pieces of legislation—we recognise that there will always be a need for social rented housing. We agree that there ought to be a standard.

Murray Tosh (Conservative, South of Scotland)

Can we have a question, please?

Lyndsay McIntosh (Conservative, Central Scotland)

I have just got there. Will the minister tell us a little more about that standard? Are we talking about several standards? Does she refer to standards that are in existence south of the border or something completely different?

The minister proposes to review and reconsider improvements in the transfer process. That would be a sensible precaution to take, in the light of the experience in Glasgow. However, I assume that she already knows what needs to be done. I hope that the consultation will not be an empty paper-chase for organisations such as the CIHS. I suspect that the minister knows what they are looking for from the standard.

Murray Tosh (Conservative, South of Scotland)

Is there another question?

Lyndsay McIntosh (Conservative, Central Scotland)

I was merely going to comment that delegated responsibility—

Murray Tosh (Conservative, South of Scotland)

This is not a comment session; it is a question session. I would be grateful if you could come to your next question.

Lyndsay McIntosh (Conservative, Central Scotland)

Are we really talking about proper devolution to local authorities?

Margaret Curran (Labour, Glasgow Baillieston)

Lyndsay McIntosh raises several questions. Yes, we have some idea about what we expect the standard to include. The standard will cross-refer to the work of the housing improvement task force. I pay tribute to the task force, which has undertaken a considerable amount of detailed work on what the standard will be. We imagine that it will include factors such as thermal efficiency, the condition of bathrooms and kitchens, adaptations for people with special needs, and so on. However, our minds are not absolutely set and we will take views on what the standard should include. I have tried to make it clear—and the Minister for Finance and Public Services would be the first to agree with me—that we will be realistic and effective in delivering the standard. It is not purely aspirational; it will be delivered. Nonetheless, we recognise the challenges that it poses. We believe that we can meet them.

I have no intention of engaging in an empty consultation exercise. That would be a waste of my time and of everybody else's time. The consultation will be genuine, as I hope that I have proved in the past.

Lyndsay McIntosh spoke about learning about the stock transfer process. I have considerable experience of stock transfers throughout Scotland, in different situations. As I said in my statement, they are a great option for many local authorities. Nonetheless, we need to improve the process and the improvements are readily available. I will, of course, talk to other people and consider the views of different agencies in improving the process. It is such a good deal for tenants that we must bring them the benefits of it as soon as possible.

Robert Brown (Liberal Democrat, Glasgow)

On behalf of the Liberal Democrats, I welcome the minister's comprehensive statement.

The introduction of prudential borrowing is a welcome widening of the options. First, will the minister ensure that, in the arrangements that are made for prudential borrowing, the emphasis is placed on councils' duty to consider the long-term maintenance of their properties? That has been the big failure of public housing in the past.

Secondly, will the minister indicate whether there is to be a target for the number of new or rehabilitated houses that result from the new resources that are made available through prudential borrowing?

Thirdly, will the national standard be the same as the index of housing quality, which has been talked about before, or is it a third standard that is somewhere between it and the tolerable standard?

Finally, with regard to the important announcement about private sector housing, does the Executive intend to add increased resources over time? That will be the most challenging area, because of the state of the tenement stock throughout Scotland.

Margaret Curran (Labour, Glasgow Baillieston)

Is that all?

Robert Brown (Liberal Democrat, Glasgow)

Yes.

Margaret Curran (Labour, Glasgow Baillieston)

We can always rely on Robert Brown to ask detailed questions. Legal training has something to answer for. I will do my best to answer all of them. If I do not give all the details that he wants, I shall be more than happy to get back to him.

Long-term maintenance is central to the changes that we are trying to introduce. Local authorities agree with us on that. Stock transfer reveals clearly that we must move to long-term planning in housing expenditure—not just of the resources that are available, but by projecting long-term demand and housing conditions. Much of the information that is required to do that is not as robust as it should be. Therefore, we are trying to drive all key partners towards a more businesslike approach, whereby they take a longer-term view of the sustainability of their stock instead of just complying with the short-term rules. Local authorities sometimes say that they have not been liberated enough to do long-term planning, so we are trying to establish a more devolved relationship with local authorities.

On Robert Brown's point on the index of housing quality, we are building on previous work. Through the Social Justice Committee's work and my experience, we understand the issues in housing quality and the need to set a standard. The housing improvement task force will continue to consider the review of the tolerable standard, which is a condemnatory standard. The new standard will be more than that. We want a standard that will fulfil people's expectation of being able to live in a decent standard of council housing.

On available resources for the private sector, new money is available in the form of an extra £65 million, compared with current expenditure, over the three years from 2003-04 to 2005-06. Robert Brown's other point, if I picked it up properly, was on the need to ensure proper targets and balance in relation to housing supply. That is part of the business planning approach that we are trying to take. We acknowledge that different local authorities have different issues. For example, in Edinburgh and in many rural areas the supply of new housing is a significant issue.

During the first session of the Parliament, we have moved to a position of giving more strategic support to housing issues through local housing strategies, so that available resources can be deployed to maximum effect to meet the different needs of different local authorities. We feel that that is a key part of the jigsaw, which will allow all key housing partners to move to strategic deployment and, I hope, meet the challenges that lie ahead of us.

Johann Lamont (Labour, Glasgow Pollok)

I refer to the minister's comments about the private sector. The minister will be aware of the anxieties of some owner-occupiers of properties that were bought under the right to buy about the implication for them of Glasgow's housing stock transfer and of the significant investment in Glasgow's council housing that will follow from that. What assurances can the minister give that the new grant system for the private sector will be targeted at those owner-occupiers and will be substantial enough for them to gain from housing improvements? Can she also assure us that such households will not operate as a local barrier to those important developments?

Margaret Curran (Labour, Glasgow Baillieston)

Johann Lamont, who is the convener of the Social Justice Committee, has raised specific issues about Glasgow. She will know that I am close to many of the issues in Glasgow and that, as a Glasgow MSP, I have received many representations about the important issue to which she referred. I believe that the housing policy that has been developed for Glasgow addresses that issue.

We acknowledge that not only in stock transfer situations but throughout Scotland people in the owner-occupied sector might not have the resources to meet needs. I have reflected that issue in my policy statement. However, that must be balanced by our belief—which differs strongly from the belief of the nationalists—that people are responsible for improving their houses. We cannot let people escape that responsibility. It is not the Scottish Government's role to subsidise private sector development in that way.

We acknowledge that particular needs must be met. That is why we will means test them and ensure that the money properly goes to those who are most in need, at whom the resources should be targeted. That position is in keeping with Robert Brown's point.

Linda Fabiani (Scottish National Party, Central Scotland)

I, too, welcome the policy statement, which is a tribute to the task force and all who helped its work.

I have two quick points. The first is to pick up on what the minister said about people's responsibility to maintain and improve their houses. Many people in Scotland are in private rented stock that is below tolerable standards. It is landlords' responsibility to ensure that they take rent for a decent house. Has consideration been given to expanding the decency standard to include houses in the private rented sector? That would tie in with the issue of tenement law. When is legislation likely to be introduced?

On prudential borrowing, obviously only some local authorities will be able to take advantage of the loosening of the rules. Other authorities will not be able do so and stock transfer would seem to be the only option for them. If a council dug in its heels and said that it did not want to proceed with stock transfer, what could we do to ensure that its tenants are not stuck in the middle and do not fail to get the benefits of what the minister has announced?

Margaret Curran (Labour, Glasgow Baillieston)

Linda Fabiani raised several issues, one of which is the private rented sector. The housing improvement task force, with whose work I know Linda Fabiani is familiar, is considering a standard for the private rented sector. We will try to cross-refer the work on the Scottish standard for social housing with the task force's work on the private rented sector to ascertain whether the two standards that are being developed have aspects in common.

Much of the detailed work of the housing improvement task force will be extremely helpful in addressing those issues. As Linda Fabiani knows, the task force will report on its work in spring 2003. That report will address matters such as tenement law, with which the task force is grappling just now.

Linda Fabiani's point about the prudential regime highlights a significant issue. Some local authorities might dig their heels in, but I cannot imagine local authorities not welcoming today's statement. Most local authorities act responsibly in delivering facilities to their tenants and will be aware of the range of available options. We always want to hear what local authorities want to say. However, if local authorities cannot lever in resources from the available options, they are failing their tenants and must come to terms with the issues that face them.

The Executive is unequivocal in its view that there are substantial resources and mechanisms to allow the new standard to be achieved and for tenants to have affordable, warm, dry homes that are fit for the 21st century. We expect local authorities to operate within the available mechanisms. Most local authorities are prudent and sensible and are driven to improve standards for their tenants, and they will strongly welcome the new standard and will use the available options.

It would be disingenuous at best for us to pretend that there are hidden resources that we can just throw at local authorities. That is why, when we go into the election, all our proposals will be fully costed. We will ensure that tenants and voters get facts when deciding for whom to vote. We must take politics forward in Scotland by giving people real information and choices. I think that we have finally done that for housing in Scotland.

John Home Robertson (Labour, East Lothian)

I congratulate the minister on her excellent achievement of extending the prudential borrowing system. Does she recall that East Lothian is an area where stock transfer could not possibly make sense and where there is a truly desperate need for more affordable rented housing? East Lothian has 6,000 people stuck on the waiting list and there are only 400 re-lets each year.

East Lothian Council will have virtually cleared its housing capital debt by 2004, so I sincerely hope that the council will be able to implement the Executive's excellent new policy and build more affordable rented houses as soon as possible. Will the minister arrange for an early meeting between her officials and local authorities such as East Lothian Council, which might be able to build new rented houses?

Margaret Curran (Labour, Glasgow Baillieston)

I am always happy to direct officials to do things and of course they can do what Mr Home Robertson suggested. I thought that he was going to ask me to meet with East Lothian Council and I was going to say that I would be happy to do so.

John Home Robertson (Labour, East Lothian)

The minister would be welcome.

Margaret Curran (Labour, Glasgow Baillieston)

I am welcome, am I?

We have all talked in the chamber until we are hoarse about the fact that Scotland's housing policy has never been that one size fits all. The Executive has always said that stock transfer is one option among many and that it does not make sense for some local authorities. The Executive has always been honest, working in partnership with the Westminster Government, about the fact that we would only ever change financial rules when we thought that it was prudent and in the interests of the Scottish budget and the Scottish people to do so.

We will not be irresponsible with the resources that are at our disposal and we must manage them properly. That is why we are introducing prudential borrowing, which will be an attractive policy for East Lothian Council in particular. I hope that I will join my officials at a meeting with East Lothian Council and that John Home Robertson will also be there.

Richard Lochhead (Scottish National Party, North East Scotland)

I thank the minister for her statement and turn her attention to the quality and availability of housing in our rural communities. Is she aware that many landed estates in rural Scotland would rather hold on to scores of empty houses than make them available to local young people who want to continue to live and work in the areas where they were born? What steps is she taking to ensure that that housing is made available to local people, not just for renting but for ownership, so that local young people can commit their futures to their rural communities?

Margaret Curran (Labour, Glasgow Baillieston)

I have taken the issue of rural housing seriously since I became deputy minister. I think that I answered a question from John Farquhar Munro on the issue last week at question time. I have visited many rural areas since I have been in post and have worked closely with Communities Scotland on the range of options that it delivers. I strongly congratulate Communities Scotland for the delivery of that work.

At question time last week I talked about the successful low-cost home-ownership strategies that we developed, but those do not answer all the problems and we need to address other issues. However, I think that the money that we announced today and the outcome agreements that will be in place between Communities Scotland and local authorities to ensure that private sector money gets invested properly begin to address the problem.

In my time in office, I have also met a number of rural landlords to ensure that they are addressing housing needs within their areas. We now have a variety of mechanisms to address such issues. Today's announcement will allow local authorities fundamentally to address the issue of supply within their area.

At the centre of our housing policy is a recognition that Scotland is a diverse country that has different needs in different parts, so it is proper that we devolve power to local authorities and work in partnership with other sectors to ensure that housing needs are addressed within the different rural communities, which are quite different from one another. Having done a lot of work with the islands and such like, I think that we now have a package of measures that will begin to address those issues fundamentally.

Rhoda Grant (Labour, Highlands and Islands)

I welcome the minister's statement and the investment in private housing stock, but I want to push the minister a wee bit further on what she said in her answer to Johann Lamont about how the investment will work. I welcome the fact that the investment will be means tested and will go to those who are most in need, but as those most in need are often elderly, will the minister work with organisations such as Age Concern to ensure that the elderly are aware that the money is available? Also, will she confirm that the money will be ring fenced so that it cannot be used for other purposes, such as servicing housing debt?

Margaret Curran (Labour, Glasgow Baillieston)

We want the funding to be targeted. That is a fundamental issue. I will ensure that the member gets detailed information about this, but the way in which the investment will work is that the money will be allocated to local authorities, which will be required to ensure that the money is spent on what is set out in the outcome agreements that they will have agreed with Communities Scotland. That process will determine the allocations for the next year. In a sense, that will ensure that the money is targeted, given the concern that money has not always been targeted at that sector.

Rhoda Grant's suggestion about working with Age Concern is valuable, as there is a need to ensure that elderly citizens are properly informed about what their expectations should be. We also need to encourage an environment in Scotland in which key organisations work with local authorities to ensure that issues are resolved, but I think that we can make progress on that effectively.

John Farquhar Munro (Liberal Democrat, Ross, Skye and Inverness West)

On behalf of the Liberal Democrats, I welcome this morning's statement from the minister. Much of what it contained is indeed to be welcomed. I had one reservation, but the minister may have answered my question in her response to John Home Robertson. In light of Highland Council's recent statement suggesting that the lack of affordable housing in the private and rented sectors causes young families in rural Scotland particular difficulties, will she assure me that rurality will be taken into consideration in allocating funding to councils, so that that difficulty might be addressed?

Margaret Curran (Labour, Glasgow Baillieston)

The scheme that we have introduced will enable that to happen. Local authorities will determine what are the best options available to raise the necessary investment to address the housing issues that they have determined to prioritise. The prudential regime will allow them that option.

I will not pretend that all difficult political decisions will thereby evaporate, as that might not be the case. Some local authorities face considerable housing problems because of the scale of their debt, the level of their rents and the level of the investment that is required. We cannot let those problems continue and we must fundamentally address them. For such local authorities, stock transfer may be the best means of levering in finance; for others, the prudential regime may offer opportunities for the local authority itself to invest, which would then allow the authority to determine that rurality is a key issue. The prudential regime will allow the decision making to be taken at that level.

As housing minister, I would say that rurality is a strong feature of our general approach to housing. Both John Farquhar Munro and I are committed to ensuring that we have a Scottish housing policy that reflects Scotland, so it is obvious that the rural dimension must be critical. I hope that we are beginning properly to address those issues.

Cathie Craigie (Labour, Cumbernauld and Kilsyth)

As well as welcoming the minister's statement this morning, I welcome the emphasis that the Scottish Executive has placed on housing. After many years of campaigning, we now rightly have housing well up the political ladder.

The minister mentioned capital receipts and the changes to the set-aside rules, which were referred to by John Home Robertson in connection with East Lothian Council. I know that North Lanarkshire Council has been lobbying the minister quite hard to emphasise the quality of well-maintained housing that it can provide with low debt, low rents and the involvement of tenants at every level. Will the changes to the treatment of capital receipts and set-aside rules allow North Lanarkshire Council to invest more in its stock?

The minister also spoke about the intention to consult on the development of a Scottish standard for social housing. I know that the housing improvement task force is looking at the private sector, which other colleagues have mentioned, but the need to expand the regulations to establish standards within the private sector is an issue that is very much in the minds of members whose constituencies contain high numbers of private sector houses.

Margaret Curran (Labour, Glasgow Baillieston)

During the time of the Scottish Parliament, issues have accumulated in our debates on housing. Indeed, Alex Neil was a member of the Social Inclusion, Housing and Voluntary Sector Committee when we first considered many of the issues. There is a genuine understanding across the Parliament that there is a fundamental need for us to come to terms with the issues, but that is why the housing improvement task force was established and why it has gone into its work in such depth. As Cathie Craigie will know, North Lanarkshire Council is represented on the task force and has itself raised such issues.

Notwithstanding what has been announced today, I expect that the housing improvement task force's report will have something to add about what work needs to be done in the private sector. However, today's announcement is a critical component of what has been asked for by local authorities, which have spoken about the need to move forward.

Like every previous housing minister, I have received strong and robust representations from local authorities on the set-aside rules. We will not relent in our determination to deal with debt in Scottish housing. If it is not dealt with, it will be paid for in some way or another, so it simply must be addressed. However, we believe that the prudential regime will allow us to consider the issue differently, as it will allow local authorities to address the issue of how they manage their debt and how they manage their resources. Within that context, the capital set-aside rules essentially do not have the same relevance. The first issue to be dealt with is how the prudential regime for local authorities will work and within that context the capital set-aside rules will be discussed. The fact that we will be governed by the April 2004 deadline means that we will be able to talk to local authorities about that.

Bill Aitken (Conservative, Glasgow)

As ever, I do not doubt the minister's good intentions, but does she agree that, although it is all very well to set standards, the question of target dates must be resolved as a matter of urgency? We need to resolve the issue of the total expenditure that is likely to be incurred in bringing public sector housing up to the appropriate standard once that standard has been agreed. Will she liaise with her colleague the Minister for Parliamentary Business to ensure that the full figures are brought back to the Parliament so that they can be properly debated within an acceptable time scale?

Margaret Curran (Labour, Glasgow Baillieston)

I am happy to give Bill Aitken that assurance. Not to have a full and open debate on such issues would serve nobody's purposes. The Executive has nothing to hide about the resources that we are making available for Scottish housing and we are willing to proclaim our success proudly. I am more than happy to give a commitment to come back to Parliament. I am sure that if I chose not to do so, the Minister for Parliamentary Business would direct me otherwise.

I understand completely why Bill Aitken has raised the serious issue of the target dates, as that concerns how we lever in the resources, but that is why we have said that we want to introduce the new standard as competently and as efficiently as possible. We will not get into a bidding war—as some agencies or organisations might tempt us to do—on what the target date should be. We want whatever we do to make sense. The date should not be some implausible target that has been set by a politician with no true recognition of what is happening in the field.

I mentioned the Scottish house condition survey because that will give us a real sense of what the investment needs are and of what strategies must be put in place to meet the standard. That is why I said that we need to set an interim date and milestones that can be assessed so that we can know that we are going in the right direction. Matched to that is a clear and unequivocal understanding that standards must be met.

In a sense, that is the answer to the implication behind Rhoda Grant's question. We are now putting in place the mechanisms for local authorities to address their fundamental housing issues that we expect them to address. We will drive up standards and use all levers at our disposal to make sure that those standards are met. The targets and the milestones will be part of that, but I am sure that we will discuss this matter again.

Murray Tosh (Conservative, South of Scotland)

I think that I will be able to get everybody in.

John McAllion (Labour, Dundee East)

As the minister knows, the wind-up of the new towns was the only occasion when tenants were free to choose between transfer to a housing association and transfer to a local authority, and by an overwhelming majority they chose to transfer to a local authority. If the interests of tenants always come first, will the minister allow debt write-off to be tied to the transfer of council stock to a stand-alone housing company that is wholly owned by the council and freed by the debt write-off to borrow private capital on the strength of its housing revenue schemes? I know that tenants and council alike are calling for that in Dundee.

Margaret Curran (Labour, Glasgow Baillieston)

For the life of me, I cannot as a socialist see the attraction of a housing company over a housing association. A housing association is a much more democratic institution. Nonetheless, I still think—

John McAllion (Labour, Dundee East)

Will the minister put the tenants' choice first.

Margaret Curran (Labour, Glasgow Baillieston)

I will answer the question; honestly, I will come to it. Through the housing association model we have seen more tenant involvement, more tenant empowerment and more tenant control than were ever envisaged under any other model. John McAllion and I have debated this issue over many years. I think that our positions will remain the same.

Nonetheless, in keeping with the spirit of what I just said, many local authorities genuinely want to involve their tenants and to examine different models. There are options for sophisticated levels of tenant participation in the local authority model that enable tenants to influence decision making. I have never argued against that. If possibilities exist, and if local authorities say to us, "We have a different model that allows us also to meet the standards that tenants expect," I will be open minded about it. However, I will not collude with local authorities that insist that their stock should stay under one model, irrespective of what the consequences are for all their tenants, whether that model drives up standards and whether it tackles issues such as dampness.

Our fundamental concern is for tenants in Scotland who demand, and will now get, decent housing standards. The best way to drive that is to allow them to make the decisions. If local authorities can deliver what tenants want, so be it, but we will drive up standards for tenants in Scotland.

Alex Neil (Scottish National Party, Central Scotland)

I will follow on from John McAllion's point. Is there not a central contradiction in the minister's policy? On the one hand she says that one size does not fit all, and that the policy should be flexible enough to ensure that we get horses for courses. On the other hand, in her statement she said that local authorities' housing debt will not be written off unless they go down the stock transfer road that she tells them to go down. The minister cannot have it both ways. She cannot say, "We will be flexible," and on the other hand say, "You will get the debt written off only if you go down the stock transfer route." My second point is on the important point in the minister's speech about linking housing investment to wider employment and other issues. We saw a report this week on child poverty and a report last week on unemployment. We know that there will be a shortage of 27,500 workers in the construction industry in the years to come. What discussions has the minister had with the Construction Industry Training Board and Scottish Enterprise on solving the skills crisis in the building trade?

Margaret Curran (Labour, Glasgow Baillieston)

This is good fun. I am amazed that Alex Neil says that there is a central contradiction in my policy. He should address that comment to Kenny Gibson and Linda Fabiani, because they strongly welcomed that policy. There is obviously some kind of double thinking going on in the SNP.

The time is now right for us to be honest with tenants, because the ordinary person in the street in Scotland understands that money cannot just be manufactured to promote a certain policy. We have said clearly that the standard of a large proportion of housing in all its diversity throughout Scotland is not acceptable. That is partly the Conservatives' fault, but we will come back to that another time.

Standards are not acceptable. Current financial regimes need to address a variety of methods to provide investment to enable housing to meet the standard. The debt profile in Scotland had to be fundamentally addressed. We could have buried our heads in the sand, but it would have done tenants a disservice if the fundamental issue of debt had not been addressed. Through our relationship with the Treasury, we have the most radical housing policy that has been developed in Scotland for generations. It allows debt to be written off, but also allows other opportunities to lever in investment.

Under Alex Neil's leadership—if that ever comes about—or in the Scotland that Alex Neil would want us to live in, he would expect the public purse to pay for everything. He could not possibly sustain the level of investment that is required to lift the debt and invest in housing. Glasgow is a case in point, which is why Linda Fabiani and Kenny Gibson ultimately supported the stock transfer in Glasgow. I presume that Alex Neil's policy would be to lift the £1 billion housing debt and to invest in housing, but he could not possibly find the proper resources do that. Through our policy, we get the best of both worlds: the debt is lifted and we find the means to invest in Scottish housing. That is absolutely what tenants require.

Murray Tosh (Conservative, South of Scotland)

I had not allowed for Alex Neil in my timing calculations. I have two members—

Margaret Curran (Labour, Glasgow Baillieston)

Presiding Officer, I did not answer Alex Neil's second point. I got carried away.

Murray Tosh (Conservative, South of Scotland)

I will allow this session to extend beyond the indicated time, but I would be grateful if the minister could answer the second question relatively briefly so that I can bring in Rhona Brankin and Kenneth Macintosh.

Margaret Curran (Labour, Glasgow Baillieston)

I will be brief. I would never wish to fail to answer questions in the Parliament. As Alex Neil knows, I do my best. He may disagree with my answers, but I do answer questions.

I have had significant discussions on apprenticeship training with Glasgow City Council. I have also had a number of meetings with Iain Gray, who has taken up a lot of the skills issues to do with construction jobs, in particular in relation to stock transfer.

Rhona Brankin (Labour, Midlothian)

Like other members, I welcome the announcement. I am pleased that the minister recognises the need for flexibility for local authorities.

As the minister will know, Midlothian Council in my constituency currently provides high-quality social housing, but it has major problems in meeting the demand for affordable housing. Could she tell us briefly what difference in practice her announcement will make for councils such as Midlothian Council? John Home Robertson invited the minister to visit East Lothian, so I invite the minister to Midlothian to see for herself the quality of the houses and to meet some of the tenants and, more important, some of the people who are on the rather long waiting lists. The minister could do that in a day.

Margaret Curran (Labour, Glasgow Baillieston)

My diary is getting more exciting as the minutes pass. I would be happy to come to Midlothian. It is my understanding that the issues in the Lothians require the flexible approach that we are taking. Different local authorities face different housing issues. It is important that I communicate that I understand those different housing issues. The issue is not just the stereotypical rundown housing estate. I pay tribute to the many local authorities that provide high-quality housing and a high-quality service to tenants. It is important to put that on the record. I am happy to come to Midlothian to witness that.

The new regime will give local authorities the scope to prioritise their own housing strategies and to have investment that follows those strategies, depending on their local needs. Borrowing must be within the prudential regime, so it must be prudent and based on rents, because it would be unwise for councils to go to unsustainable rent levels. However, within that framework, councils will be allowed to determine their own priorities. There are many opportunities for local authorities such as Midlothian.

Kenneth Macintosh (Labour, Eastwood)

I am grateful that you let me in, Presiding Officer.

I assume that it was not the minister's trip to Busby and Barrhead on Saturday that was needed to persuade her to make today's announcement, but she will know from talking to residents there how welcome today's announcement will be. Without wishing to make the minister's diary too exciting, I ask her to find a space in her diary to return to Busby and Barrhead to talk to councillors Betty Cunningham, Alan Lafferty and Ian Forbes, in particular, about the proposals. Will she reassure me that those discussions will take place before April 2004 and the introduction of the prudential borrowing scheme?

Like Dundee, which my colleague John McAllion referred to, East Renfrewshire has a number of innovative ideas to fund council housing. Will the minister discuss those ideas with East Renfrewshire Council, and perhaps make clear the criteria? That council has already involved tenants hugely, but it might not necessarily be going down the housing association line, so it would welcome any criteria that the minister could provide on what would be appropriate. I welcome any further discussion on the set-aside rules, which will also be welcomed by tenants in East Renfrewshire.

Murray Tosh (Conservative, South of Scotland)

I am grateful that you asked a short question, Mr Macintosh.

Margaret Curran (Labour, Glasgow Baillieston)

Another invitation—this is getting more exciting. I notice that I did not receive any invitations from SNP members, but I will not take it personally.

I met Councillor Cunningham in Busby and Barrhead on Saturday, and I would be happy to go back to have, I hope, a less robust discussion. Hugh Henry recently met representatives of East Renfrewshire Council. Local authorities such as East Renfrewshire Council are beginning to consider different models of tenant involvement and we need to understand that. The member is well aware that we must operate within existing financial regimes. However, such ideas open up new possibilities for us and options for developing them exist.

Barrhead has significant housing issues that must be addressed. We need to talk about how the financial regimes will work. I am clear that we will have those discussions before the new regime is introduced and that we can talk about how the capital set-aside rules will work. The Executive's housing officials are engaging with many local authority officials so that we can work out the options for local authorities.

Murray Tosh (Conservative, South of Scotland)

I will write to the minister with my questions.

Margaret Curran (Labour, Glasgow Baillieston)

I hope that I will receive an invitation.

Murray Tosh (Conservative, South of Scotland)

I give invitations regularly.

Forestry

Murray Tosh (Conservative, South of Scotland)

The next item of business is a debate on motion S1M-3541, in the name of Allan Wilson, on forestry in Scotland, and on two amendments to that motion. I call Allan Wilson to speak, after he has shuffled his papers and sorted out his folders.

Allan Wilson (Labour, Cunninghame North)

Thank you for your patience, Presiding Officer.

We have made several announcements about forestry in recent weeks, so the debate is timely. Forestry is important to Scotland, although perhaps it is not as important as the Conservatives' amendment suggests. One sixth of our land is wooded. Forestry and primary wood processing provide jobs for about 10,000 of our fellow citizens, and every year about 2 million Scots visit a wood or forest as part of a recreational trip.

The industry contributes about £800 million to the Scottish economy, so it accounts for about 0.5 per cent of our gross domestic product. It is not our third biggest industry, as the Conservatives suggest, but its importance is proportionally much greater in rural areas. There is no doubt that we need a thriving forestry industry to promote the economic well-being of our rural areas. Well-designed woods and forests also make a valuable contribution to our environment by creating habitats for wildlife and enhancing our landscape.

The overarching principle of our Scottish forestry strategy, which was published two years ago in November 2000, is sustainability. Scottish forestry must contribute positively to sustainable development and meet internationally recognised standards of sustainable forest management. The other guiding principles are integration, creating positive value, community support and reflecting the rich diversity and local distinctiveness of different parts of Scotland.

The strategy identified five key directions for the industry. The industry should maximise the value to the Scottish economy of our wood resource, which will become available for harvesting in the next 20 years, when we expect production to double. It should create a diverse high-quality forest resource for the future. It should also ensure that forestry contributes positively to our environment, creates opportunities for more people to enjoy our trees, woods and forests and helps communities to benefit from woods and forests. The strategy also identified 23 priorities for action. At a Scottish forestry forum meeting later this month, we will publish a progress report on the implementation of our strategy.

Forestry is a devolved matter, but it was agreed at the time of devolution that the Forestry Commission should continue to deliver forestry policy. The commission became a cross-border public authority with its head office in Edinburgh. Three national offices were established, along with a Great Britain central core. Following a recent review, we agreed with ministerial colleagues in other Administrations that functions should shift significantly away from the centre to strengthened national offices for Scotland, England and Wales.

The national office for Scotland will act as the Scottish Executive's forestry department and be responsible for managing Scotland's national forests through a separate Forest Enterprise in Scotland. That will give us closer control over how our national forests are managed and ensure greater integration between forestry policy and wider Scottish Executive policies.

Alasdair Morgan (Scottish National Party, Galloway and Upper Nithsdale)

Could some of the headquarters jobs in Edinburgh be moved to another part of Scotland, where they might be nearer the trees?

Allan Wilson (Labour, Cunninghame North)

That is a fair point. I support the dispersal of civil service and Scottish Executive jobs. I understand that those jobs and their prospective dispersal will be the subject of review.

We will continue to work closely with Administrations south of the border on some issues. For example, forest research will continue to be funded directly from Whitehall, although the Scottish ministers, through the national office for Scotland, will have considerable influence over how research funding is spent.

Rhona Brankin (Labour, Midlothian)

Will the minister assure me that the northern research station that is situated near the Bush estate in Midlothian will be safe?

Allan Wilson (Labour, Cunninghame North)

I will look into the research station's safety and answer the member's question in due course.

A ministerial committee is being established to bring together the ministers with responsibility for forestry in Scotland, England, Wales and Northern Ireland. That committee will meet regularly to oversee the new arrangements, to discuss the handling of international issues and to agree on any other cross-cutting forestry issues on which collaboration is advantageous. I am developing a concordat between the Forestry Commission and the Executive to spell out how those arrangements will work in practice. The main changes will be implemented by April next year.

We have conducted a major review of the forestry and woodland grant schemes to ensure that the grants are properly aligned with the Scottish forestry strategy's priorities. Subject to European Community approval, we plan to launch the Scottish forestry grants scheme in April next year. The new grant scheme was developed by a steering group that included representatives from the industry, farming and crofting interests, environment groups, local authorities, the Forestry Commission's national office for Scotland and the Scottish Executive's environment and rural affairs department.

A key recommendation of the group was that the use of our forestry grants should switch emphasis. At present, about three quarters of the money is allocated to forestry expansion and a quarter is for work to improve the environmental, social and economic value of existing forests. We intend to shift that balance significantly so that half the money will be used to improve existing forests and half will be used to fund new woodlands.

One feature of the new grant scheme will be better targeting of money for new woodlands. In September, I announced a £1.85 million package of locational premiums for central Scotland, Ayrshire, Grampian and the northern isles. I asked for details to be worked out through local consultation and I am happy to announce that Grampian forest forum has agreed that the locational premium for Grampian forest should be £1,500 per hectare. That sum will be available to farmers who want to diversify into forestry to create well-designed, productive woodlands of 10 to 30 hectares on their land. Overall, we are making provision of £26 million for forestry and woodland grants next year. That should be compared with our highest-ever expenditure on grants, which was £25 million in 2000-01.

We established the Scottish forest industries cluster to help continue the development of a strong forestry industry and to search for innovation in products and markets. The cluster is a partnership between Scottish Enterprise and the industry. Its key achievements include establishing a centre for timber engineering and developing stronger links between the wood processing industry and wood users, including architects and people who specify buildings for procurement.

Margaret Ewing (Scottish National Party, Moray)

Wood processing is an important feature of the timber industry. Could the Executive's proposals reduce the amount of timber that is exported for processing rather than processed at home?

Allan Wilson (Labour, Cunninghame North)

I will talk about adding value to the wood production process. I agree with the idea that we should ensure that much of that added value is created in Scotland, where the timber is produced.

The cluster is looking for new and less conventional ways of adding value to timber. There is scope for making more use of wood for fuel. Practical seminars on that subject have taken place in different parts of Scotland and I am encouraged by the evidence from the projects that are under way.

There is no doubt that the past few years have been difficult for the industry. Timber and wood product prices are at historically low levels, which undoubtedly poses major challenges throughout the industry. It against that difficult background that the positive work of the Scottish forest industries cluster group is so encouraging.

We want to encourage more use of timber and to add value to that process. The Forestry Commission is contributing to the generic marketing campaign "wood. for good". Last month, the Forestry Commission, along with the Executive, Historic Scotland and the architecture profession, organised a very well-attended conference on timber and the built environment.

We recently submitted a bid to the European Union for a €885,000 project to investigate, with other nordic countries, ways of using external timber cladding in maritime climates. Following the world summit on sustainable development in Johannesburg, we agreed to examine ways of using our purchasing power to promote the purchase of wood products from sustainable sources.

Another difficult issue for the industry is the transportation of timber. There are places where the only access to forests is along minor roads, which were never designed for heavy use by timber traffic. I am pleased that the forestry industry is now working closely with local authorities to try to identify pragmatic solutions to those problems, including the preparation of agreed route maps and demonstration projects that are aimed at developing cost-effect road engineering solutions.

Alex Fergusson (Conservative, South of Scotland)

Does the minister think that part of that strategy should be the land locking of blocks of timber by the closure of roads to forestry transport?

Allan Wilson (Labour, Cunninghame North)

I believe that those strategies are best worked out at the local level between the industry and local authorities, as that will produce solutions that are best suited to the local area. As the member knows because we were in Dumfries together, I launched the agreed routes map for Dumfries and Galloway and saw some of the imaginative engineering developments that are taking place in that area.

Where possible, more use is being made of sea and rail transport. That approach is being encouraged through our freight facilities grants. In January, I will meet representatives of the Convention of Scottish Local Authorities and the forestry industry for further discussions on timber transport.

Forests are also important attractions for tourists and visitors to Scotland. As members know, we are running treefest Scotland 2002, which is a year-long initiative to celebrate Scotland's trees, woods and forests. During the year, more than 750 events are taking place throughout Scotland, including the Edinburgh treefest event in Inverleith park; tree in the park in Hamilton, which attracted 27,000 people over a weekend; and a major forestry machinery demonstration, which a number of MSPs attended. That demonstration attracted so many visitors that every hotel in that part of Dumfriesshire was fully booked and provided a massive injection of money into the local economy.

In Perthshire, the big tree country initiative has shown how joint promotional work can increase the value of the local forest heritage to our local tourist industry. How many members know that in Scotland we have the oldest living thing in Europe? [Laughter.] It is not Winnie Ewing; it is the Fortingall yew. In the Borders, Forest Enterprise is developing first-class mountain biking facilities to attract more visitors to the area.

Our recent spending review provided an additional £4 million for forest recreation facilities—especially in national parks—and improvements to the natural heritage value of Scotland's national forests. That significant injection of funding recognised the importance of trees to tourism.

The Scottish forestry strategy also aims to help communities benefit from woods and forests. At present, around 50 community woodland groups in Scotland control the ownership or management of about 20,000 hectares of woodland. A number of large-scale community purchases of woodland have been made possible through the Scottish land fund. To take forward that agenda, and to encourage more community involvement in forestry, the Forestry Commission has established a forestry for people advisory panel. Our proposed grant scheme will include grants to support community woodland initiatives, which I am particularly keen to develop in urban brownfield sites. Forest Enterprise will work closely with many community groups on those initiatives.

We must also ensure that Scotland's trees, woods and forests make a positive contribution to the environment. That has not always been the case and the work of the Forestry Commission in that respect was recently acknowledged by no less than the WWF, which presented the commission with its gift to the earth award in recognition of its substantial contribution to our national environment.

Our new grants scheme will support work to improve the ecological value of native woodlands and to enlarge them through the development of forest habitat networks. We have recognised the plight of particular species and, in addition to funding the creation of new and improved habitats for capercaillie, we contributed £770,000—a not inconsiderable amount of money—to a programme of work to remove redundant fences that might kill capercaillie, which fly into them. We have also launched a black grouse recovery project in Argyll and are mapping priority areas for red squirrel management in order to secure their numbers against the predatory grey squirrel. Funding for native woodland initiatives also comes from lottery funds and private and voluntary sources. For example, BP is providing £1 million per year over a 10-year period to support native woodland projects in Scotland.

I believe that we have achieved a good deal since the launch of the strategy. We are also putting in place important foundations for future development. Closer working with others and within the Executive will improve the integration of our rural land-use and environmental policies. In the meantime, the work of the Scottish forest industry cluster group will help to develop and strengthen our forest products industry. The new administrative arrangements for forestry will ensure that we take full advantage of Scotland's significant forestry resource, which is 70 per cent of the UK total.

In order to give members a better feel for Scottish forestry and its tremendous potential, I have arranged for copies of a new publication, "Scotland's Trees, Woods and Forests", to be made available in the chamber. I hope that everyone has a copy, as the booklet includes a well-written preface by me. It has a lot of pictures, which will suit opposition members. [Laughter.] I encourage members to read it.

We are determined to work towards our vision that Scotland will be renowned as a land of fine trees, woods and forests. They strengthen the economy, make a positive contribution to our markets and enrich the natural environment that people enjoy and value so much.

I move,

That the Parliament notes the report of the Interdepartmental Review Group on Forestry; welcomes the proposed changes to the administrative arrangements for forestry in Scotland contained in that report; notes the proposals by an industry wide steering group for a new Scottish Forestry Grants Scheme, and believes these changes will help achieve the objectives set out in the Scottish Forestry Strategy.

Murray Tosh (Conservative, South of Scotland)

I am not sure whether the minister made clear in his speech whether he is a red or a grey squirrel.

Fergus Ewing (Scottish National Party, Inverness East, Nairn and Lochaber)

I am pleased that we have the opportunity to debate the importance of the forestry industry to Scotland. I was most interested in the minister's sharing of his extensive knowledge of the flight patterns of capercaillie. I am pleased that I did not quite catch his remarks about the mother of the house. It is lucky for him that she is not in the chamber. We will read with interest those remarks, whatever they were, in the Official Report .

The forestry industry is extremely important to Scotland, and it is important to underscore why that is the case. The industry provides 11,000 jobs directly and 44,000 indirectly. In the previous debate that we had on forestry, which took place in Aberdeen on 30 May, the minister estimated the value of the industry at £800 million. Along with fishing and farming, forestry is one of the three Fs of rural industries.

However, it is fair to say that the industry feels that forestry interests are not being taken seriously enough by the Government, here and in London. The Rural Development Committee, in its extensive visits around Scotland, heard at first hand about the grave problems facing the industry. As some of those issues relate to reserved matters, they are outwith our control. We have not mentioned them in the text of our amendment, because we do not want to detract attention from our positive proposals. However, such issues include the strength of the pound; the climate change levy; and—perhaps most significant of all—the massive and cheaper production of wood elsewhere, particularly in the Baltic states, the import of which is displacing indigenous timber and forest products. Those problems are very serious and, although we always welcome a note of humour—even flippancy from time to time—members should forgive me if my remarks are also very serious.

It is unfortunate that forestry was not the first choice of debate for today. We were supposed to debate foot-and-mouth, but of course the Executive was not in a position to proceed with its report. That underscores the fact that the Executive does not seem to take the forestry industry's interests as seriously as we believe it should do.

Allan Wilson (Labour, Cunninghame North)

Will the member give way?

Fergus Ewing (Scottish National Party, Inverness East, Nairn and Lochaber)

I will in a second.

Moreover, although I welcome some of the minister's comments in his opening speech, those comments are not reflected in the text of the motion. In fact, they have nothing to do with the motion, which refers primarily to administrative arrangements. There is much to be commended in the forestry strategy. However, the text of the motion invites us not to debate the real problems, but to discuss the administrative arrangements in the Forestry Commission. Those arrangements are not unimportant, particularly for the people who work in the Forestry Commission, but the industry expects us to address the real issues that it faces.

I am happy to take an intervention from the minister if he still wants to make one.

Allan Wilson (Labour, Cunninghame North)

I just want to respond to the fairly cheap political point that this debate was only an afterthought. Does the member accept that I have had a proposal for a debate on forestry before the Parliamentary Bureau for a matter of months and that I have been waiting for parliamentary time so that the debate could take place? As a result, the Parliament's misfortune that we are unable to debate foot-and-mouth disease today is in fact the forestry industry's good fortune.

Fergus Ewing (Scottish National Party, Inverness East, Nairn and Lochaber)

I am sorry that the Parliamentary Bureau has not given more priority to the minister's pleas. However, the substantive point is that the text of the Executive's motion does not invite us to consider issues of importance.

In the next 10 to 15 years, the volume of wood that is produced and harvested will increase by two thirds, which will create a number of problems and opportunities for the industry. It is essential that a market exists for such a huge increase in the volume of wood, and the Scottish National Party believes that we can pursue at least four partial solutions.

First, we must improve the appalling state of our roads. Secondly, we must create more effective methods of allowing biomass to be used as a means of generating electricity and heat. Thirdly, Government and Government agencies must have an effective procurement policy; what we have at the moment is a complete mishmash. Finally, we must promote the use of wood as an environmentally friendly building material. I acknowledge that the minister touched on some of those issues—and that the forestry strategy document addresses most of them—but the question is when the strategy will be converted into action. That lies at the root of the industry's concerns.

Although there is huge scope for wood to be used as a biofuel for the generation of electricity and/or heat, the Government does not seem to realise that wood-burning plants do not have to be huge undertakings. That appears to be the Department of Trade and Industry's policy. Relatively small-scale plants that burn wood to heat buildings could be used in schools, hospitals and public buildings. Perhaps John Home Robertson can tell us whether any thought has been given to the possibility of such heating being used for the new Scottish Parliament building.

John Home Robertson (Labour, East Lothian)

Does the member want us to spend even more money on another boiler system?

Fergus Ewing (Scottish National Party, Inverness East, Nairn and Lochaber)

Perhaps we will hear from Mr Home Robertson later on the subject.

The Government could do much more to encourage such developments through grants. However, the DTI does not go along with that sort of thinking.

George Lyon (Liberal Democrat, Argyll and Bute)

Is Mr Ewing aware that, in Lochgilphead in Argyll and Bute, Torren Energy Ltd has developed a community wood-heating scheme, which is being installed in 50 houses that are being built by Fine Homes Ltd? The reason for choosing such a system is that Communities Scotland is encouraging the use of sustainable heating systems. As a result, policies are in place to encourage the further development of such systems throughout Scotland, and I hope that the rest of the country will follow that example.

Fergus Ewing (Scottish National Party, Inverness East, Nairn and Lochaber)

I am certainly aware of Torren Energy's work, and very much welcome the development that George Lyon has mentioned. However, why have such developments not happened all over Scotland? What is happening in Lochgilphead is certainly more of an exception than the rule.

Why have biofuels not taken off? The simple answer is that the Government's non-fossil fuel obligation arrangements did not allow operators to use existing technology, which meant that new and unproven technology had to be used instead. As a result, although one plant was built—at Arbre Energy Ltd of Selby in Yorkshire—it failed to complete commissioning satisfactorily and subsequently went into receivership. Millions of pounds have been wasted. Government policy is certainly muddled on this issue. Although there are grants for the planting of short-rotation coppices such as willow and of other fuel crops such as miscanthus, the policy is frankly a complete waste of time and money.

On rural roads, it is unfortunate that the minister has not managed to fulfil the promise that he gave on 30 May to arrange a meeting involving the Executive, the rural affairs committee of the Convention of Scottish Local Authorities and representatives of the forestry industry. That meeting was supposed to take place on 12 November, but it has now been rearranged for 8 January. If the minister cannot even fulfil a promise to meet the industry, does he really expect the industry to feel that he is taking it as seriously as we believe it should be taken?

Furthermore, according to Highland Council, it will take 200 years to repair the existing minor road network in that area. It has been estimated that it will cost £80 million simply to maintain the current situation. I have no doubt that other members will talk about the state of roads in their areas. With the wall of wood that is due to arrive, the impact on the road network will be far greater than at present. Although some modest progress has been made, we all acknowledge that the problem is extremely serious.

As far as timber procurement is concerned, the industry feels that certification is in a complete muddle. The principal standard applied to forest management was developed by the Forest Stewardship Council, which is an unelected and unaccountable body based in Mexico. Although an alternative certification standard that has been developed by the Pan European Forest Certification Council has already achieved far greater volumes of certified timber than the FSC standard, attempts by the industry and others to get the FSC to recognise the PEFC standard have so far failed. The DTI and the Scottish Executive have completely failed to sort out this extremely serious problem, which is purely one of bureaucracy.

We want wood to be promoted in construction. Although I welcome to some extent what the minister has said on the issue, I want his comments to be converted into action. Building regulations might require to be altered as a result.

Urgent action is required to address concerns about rural roads, to stimulate the development of biofuels and to promote the increased use of certified wood and wood products. The Government and Government departments have a vital role to play. The strategy and the words are in place; it is time now for delivery and action.

I move amendment S1M-3541.2, to leave out from "welcomes" to end and insert:

"but believes that the Scottish Executive has failed to acknowledge the significant contribution to the Scottish economy of the timber and forest products industry and, in particular, in respect of the existing devolved functions of the Executive, further believes that it has failed to recognise the importance of the urgent need to improve the road network used for forestry extraction, of an effective policy of procurement to encourage the Scottish national industry interest, of effective promotion of biomass to assist in the achievement of more economic means of supplying energy from renewable sources and of the encouragement and active promotion of the use of wood as a building material."

Alex Fergusson (Conservative, South of Scotland)

In opening this debate for the Scottish Conservatives, I want to state that I am disappointed that we are not debating the Executive's response to the foot-and-mouth report, as we should have been. I hope that, when the time comes for that debate, we will be given the full three hours that was scheduled for this morning. However, I expect to be disappointed in that regard.

The one and only good thing to emerge from the decision to postpone that debate is that we have at last been given the opportunity to debate the subject of forestry in the chamber in Executive time. If it had not been for my members' business debate in Aberdeen, the industry, which employs 11,000 people, has an enormous effect on the local economy of several rural areas of Scotland, as well as on the national economy, and was described by no less a person than Sir Michael Strang Steel, the head of Alba Trees, as the third largest in Scotland—that is what my amendment refers to—would have gone virtually unmentioned until now. It would probably not have had an airing had it not been for the postponement of the debate on the foot-and-mouth response.

I welcome this opportunity, because a great deal needs to be said. The debate is not helped by the incredibly laid back, self-satisfied and complacent tone of the Executive's motion. In essence, the motion states that everything is fine and that we should leave the industry to it. The Executive is saying that adding the word "Scottish" to a grant scheme or two and splitting the administrative structure of Forest Enterprise will achieve all the objectives that it set out in the two-year-old forest strategy. The strategy was launched by John Home Robertson, who I am pleased to see is here, published by Rhona Brankin, who clearly decided to leave before the subject came up, and studiously ignored by Allan Wilson.

Forestry is not an industry in which all is well. It is on its knees and has been for some time. The industry is up against massive competition from imported timber from the Baltic states, not only because of currency differentials but because of cost differentials. It is an industry that has been created since the last war with a significant input of taxpayers' money and is now having its transport links cut off in some cases because of a lack of a little bit more. It has had to make huge changes, rightly, to address the environmental and social benefit issues, to which the minister referred, and some of those issues still prevail. However, the addressing of those issues has added tremendous cost increases to an industry that is ill-prepared to meet them.

Forestry, however, is an industry that can be environmentally friendly. It is highly sustainable and has a massive role to play in rural development. That should be right up the street of this Scottish Government, but what is the Government's response? It asks us to agree that Parliament

"notes the report of the Interdepartmental Review Group on Forestry; welcomes the proposed changes to the administrative arrangements for forestry in Scotland contained in that report; notes the proposals by an industry wide steering group for a new Scottish Forestry Grants Scheme, and believes these changes will help achieve the objectives set out in the Scottish Forestry Strategy."

We are being asked to believe that those changes will help the forestry industry to fulfil the aims of the forestry strategy. I do not believe that, neither does the rest of my party and nor, I believe, does the Scottish National Party. We believe that, whatever the merits of the changes—it would be churlish to suggest that there are none—they will do virtually nothing to further either the aims of the forestry strategy or the needs of the industry.

I repeat that the industry is firmly on its knees and in need of assistance. Some of that assistance should take the form of firm targets. If the long-term wood supply forecasts are to be meaningfully addressed, why does the Scottish Executive not insist that the Forestry Commission remove the 40-hectare limit on unimproved land that can be planted under current grant schemes? I understand that SEERAD might be willing to increase that limit to 200 hectares, but that the commission is sitting on the fence and, in effect, preventing what would be an invaluable measure in addressing the forecast deficit of some 2.5 million metric tonnes by 2045 even if new plantings were to be doubled during the next 20 years, and a deficit of 4.5 million metric tonnes if there is no new planting.

There is an industry-wide perception that the new Scottish forestry grant schemes farmland premium will foster new plantings only where there is deemed to be a social benefit requirement. There is a perception too that the criteria for successful applications under that scheme will fall under the same parameter as areas that have received challenge funding. Some of the minister's speech probably backed up that perception. Those are not necessarily the areas that will best benefit or enhance the industry. However, if that perception is strong, there is total conviction in the industry that the application process for the new schemes, which were meant to simplify the process, is considerably more complex and bureaucratic. That, in turn, will make the schemes more expensive to administer and processing the applications will simply require more Forestry Commission staff time. That is typical of what we get from the Executive: more bureaucracy, officials and cost, and less money going to where it should be targeted.

The new Scottish schemes, and the devolving of power under the new structure, are fine in as far as they go. I will not be overly critical of them, but unless they are backed up by the political will to drive the industry forward, they are as nothing. A recent example was brought to my attention in east Ayrshire, where an application to plant 145 hectares has been submitted. Not one of the statutory consultees raised objections, and there are few transport issues and only a couple of minor local objections, which are outwith the statutory consultation process. However, the decision on whether an environmental assessment is required is still not forthcoming after nine months of fruitless negotiation. How can any industry move forward properly under those circumstances? Where is the decisiveness and firm grip of management that any industry requires?

The forestry strategy is a fine document, but without the robust political will and realistic support that I am calling for, it is a complete waste of time and effort.

That leaves the big issue of transport, on which I know that many other members will contribute. In response to my members' debate in Aberdeen on 30 May, the minister kindly agreed to my request, as Fergus Ewing mentioned, to get round the table with COSLA's rural affairs committee and industry representatives to discuss the specific problem. The minister knows what the problem is—he has been to a meeting of the timber transport forum and was present at the launch of Dumfries and Galloway's agreed timber transport route plan at the highly successful international forest fest 2002 at Lockerbie. He is probably not aware that many of the industry representatives who had to sign up to that agreement felt that they did so with a local authority gun that was loaded, cocked and well and truly held at their foreheads.

Many in the industry were grateful that the minister agreed to my request to set up the meeting, and I wrote to the minister on 17 June to ask who the industry representatives at the meeting would be. Showing his normal haste in response to the industry's interest, the minister wrote a reply on 31 October. I received it on 4 November, which was—amazingly—timed to coincide with the announcement of today's debate. I hope that I am not often thought of as a natural-born cynic, but if there are many more coincidences such as that, I will become one.

Furthermore, when I learned that the meeting that was agreed to in Aberdeen on 30 May is now scheduled to take place on 8 January, some seven months later, I realised why there is a sense of despair in the Scottish forestry industry. That lack of urgency signals a complete lack of interest, which is what the industry considers that it is getting from this Administration. The industry has a significant role in rural development and employment, but it is being held back—

Allan Wilson (Labour, Cunninghame North)

Will the member give way?

Alex Fergusson (Conservative, South of Scotland)

I am in my final minute and winding up. The minister will be replying to the debate.

Allan Wilson (Labour, Cunninghame North)

It concerns the meeting.

Alex Fergusson (Conservative, South of Scotland)

If the Presiding Officer is happy, I will give way.

Allan Wilson (Labour, Cunninghame North)

The delay in the meeting with COSLA has been raised twice now. Does the member accept that the delay in convening the meeting has been at the behest of COSLA rather than the request of the Scottish Executive?

Alex Fergusson (Conservative, South of Scotland)

If the minister tells me that, I will of course accept his word. Nonetheless, I think that the meeting could have been driven with more urgency than has obviously been the case. A request can always be denied, and I would have liked to think that the Executive would show more urgency.

As I was saying, the industry has a significant role in rural development and employment and is being held back by a Scottish Government that is either unwilling or unable to support it in the way that it so desperately requires. It is met with tea and sympathy on the one hand, and inaction, as exemplified by the motion, on the other. The industry deserves a great deal better, and it would not take much resource to allow it to fulfil the potential that it undoubtedly holds. What is clear is that, under this Administration, it will not receive it.

I move amendment S1M-3541.1, to leave out from "and believes" to end and insert:

"but condemns the Scottish Executive's failure to address the practical problems which face the Scottish forestry industry, particularly with regard to transport; further notes that the Executive has failed to set and promote robust planting targets or to plan for the impending doubling of timber output over the next 10 to 15 years, and urges the Executive to give greater priority to the issues which so concern what is now the third biggest industry in Scotland."

George Lyon (Liberal Democrat, Argyll and Bute)

I echo the sentiments that have expressed by other members about their being given the opportunity this morning to debate the forestry industry.

Forestry is a very important industry to Scotland, as the previous speakers outlined. Some 1.2 million hectares are currently planted with trees in Scotland, which accounts for about 15 per cent of our total land area. That acreage has trebled since

1924. Half of Britain's forest and woodland area is located in Scotland, and 20 per cent of Scotland's forests are located in Argyll and Bute, making timber one of the most important industries in my constituency. It is a major employer, and it is very important to the well-being of many communities throughout Argyll and Bute.

Forestry wood processing, as has been said, contributes more than £800 million to the Scottish economy, although there seems to be some dispute about the number of jobs involved. The minister suggested 10,000, then we had bids of 11,000 from Fergus Ewing and Alex Fergusson. We certainly agree that a good number of jobs are involved, particularly in rural Scotland. The greatest impact is there, and although we can argue whether the industry is Scotland's third most important, clearly it has a major role to play in the prosperity of many of our rural areas.

As members have said, timber production is set to double by 2015 to 800 million tonnes a year. That is a massive increase, which will bring substantial challenges to industry and to the Government. The challenge to Government concerns transport. There is an urgent need for continued investment in our transport infrastructure to cope with the coming increase in wood production over the next few years. The industry faces great challenges to promote more use of timber, to improve its competitiveness by developing a strong forest industries network, to increase processing capacity to keep up with the increase in production that is coming on-stream, and to develop products that the market needs and wants so that import substitution can take place.

There are huge market opportunities to be seized by Scotland's forestry industry to reduce its reliance on imports. Currently, the United Kingdom imports 80 per cent of its wood and wood products. That can and must change. The figure could be cut to 60 per cent by 2020, and Scottish timber could close the gap.

One of the major barriers to achieving that goal is the strength of sterling, which was touched on by two previous speakers. Our major competitors are the Scandinavian and Baltic countries. If we compare the value of the Swedish krona with the pound in the mid-1990s, we note that the krona's value has fallen by 50 per cent since 1994-95. That makes Swedish timber extremely competitive in the UK marketplace.

Brian Fitzpatrick (Labour, Strathkelvin and Bearsden)

Does the member recognise that the biggest market for forestry products remains the rest of the UK and that we do not want anything to upset those arrangements?

George Lyon (Liberal Democrat, Argyll and Bute)

Yes. The point that I am about to make is that, because of the strength of sterling, other countries' extra competitiveness is reflected in the UK market price for timber, which has fallen from somewhere above £20 per tonne in the mid-1990s to about £10 per tonne today. That is a huge fall in anyone's language. That means tighter margins for the industry and less money to invest in the future, and, in some cases, it makes the extraction of timber—certainly from some of the island areas—an uneconomic prospect. In other words, the timber can never be harvested because there is not enough return. That makes Scotland less attractive for inward investment, which links in with the need to invest in further processing capacity.

It is against that harsh economic background that the industry needs to invest even more in its future. It needs to invest in further processing capacity and more value-added production to cope with the coming increase in timber volume. It is a difficult circle to square, but that must be achieved because, without that vital investment, Scotland cannot grow its share of the UK market.

I hope that the minister can reassure us that he is doing everything possible to secure the investment that I will refer to next. It is vital that the proposed second pulp line at Caledonian Paper plc in Irvine gets the go-ahead from its parent company. Decisions are yet to be taken about where that investment will go. As far as I understand it, there is competition between the Irvine company and another plant that is located on the French-German border. The second processing line would increase throughput from the 250,000 tonnes per year that are currently processed at Irvine to 850,000 tonnes, which would be a huge jump in capacity. The public agencies are doing a lot of work to try to ensure that the investment comes to Scotland, but I ask the minister in his summing up to give an assurance that no stone will remain unturned to ensure that we secure that investment for the future of the Scottish forestry industry.

In my last few minutes, I turn to some of the transport issues that have been highlighted. Among the key issues that arise in my constituency is the shifting of timber transport from road to sea. That is working well with the use of the freight facilities grants and a substantial tonnage of wood has switched from road to sea. This morning, industry representatives told me that 110,000 tonnes in Argyllshire alone have been switched from road to sea. Timber is now loaded at Portavadie, Campbeltown and Ardrishaig and shipped directly to Caledonian Paper plc at Irvine. That has dramatically reduced the number of wood lorries on our major roads and reduced the number of miles that are travelled by 1.3 million. The freight facilities grant has already made a substantial impact in my constituency.

One would think that those changes would reduce the wear and tear on our roads and ease pressure on the local authority roads budget. One would be wrong. The transfer from road to sea has reduced timber traffic on the A83, which is a trunk road owned by the Scottish Executive. However, the local authority minor roads are used to transport timber from the forests to the ports. We face the problem of using single-track roads—originally dirt-track roads that were covered with tarmac in the 1960s using the crofting counties grant scheme—with no proper construction and no firm base underpinning them. Those roads must cope with 42-tonne wagons travelling up and down, day and night, transporting wood to the ports. Many of the single-track roads in my constituency are in a dreadful state; the surfaces are poor and grass verges are run over as drivers attempt to pass each other in tight conditions.

There is a desperate need for more investment to upgrade and improve those roads, because they will be needed in the future. We are replanting in many areas already and, in another 20 or 25 years, the traffic will return. The traffic will not disappear and yet no funding has been allocated from the local authority grant-aided expenditure scheme to ensure extra investment to upgrade the roads. All that we have from those grant schemes is the historical investment for repairs.

Will the minister give serious thought to setting up a special fund that councils can bid for to upgrade their single-track roads if they have had a huge increase in timber transport and use of the roads? Such a scheme would be of great benefit.

In my constituency, the rail scheme to transfer timber from the roads has not worked well and more work must be done.

Timber production is set to double over the next few years and that means more jobs and more opportunities for rural Scotland. We must grasp those opportunities. Scotland must invest in more processing capacity to deal with extra production and we need more value-added products. The Executive must continue to invest in our road transport infrastructure to ensure that the transport system can cope with the extra tonnage. Finally, we have a great opportunity for Scottish timber; I hope that the Government and the industry will work together and take hold of that opportunity to deliver for rural areas.

I support the motion.

John Home Robertson (Labour, East Lothian)

I declare an interest: I am a partner in a family farming business and some trees grow on our land. Perhaps I should also make an apology.

I have to attend a meeting between members of the European Committee and colleagues from Flanders and Catalonia, so I must leave the debate before the end. I apologise for any discourtesy to members in the chamber.

I whole-heartedly welcome the debate about an industry that is growing in every sense of the word. The industry makes a substantial contribution to the rural economy and to the landscape of Scotland. It is an excellent use of land and takes huge quantities of carbon dioxide pollution out of the global atmosphere. Well-managed woods and forests are major assets for the economy and ecology of Scotland. Other members have mentioned high-quality ancillary industries, such as Alba Trees—Alex Fergusson referred to it—which is located at Gladsmuir in my constituency of East Lothian. There are many more examples.

There should be considerable potential for value adding by the Scottish timber industries. Much is already going on and there is potential for more. I am delighted that a lot of Scottish oak and Scottish sycamore is being used for high-quality furniture and finishings as well as for the structure of the Holyrood building. Holyrood should be a showcase for Scottish timber and Scottish skills, which I hope will be noted nationally and internationally.

As minister with responsibility for forestry, I was an enthusiast for forestry when we were writing the new Scottish forestry strategy and I am still an enthusiast. Increasing the area of woods and forests to 25 per cent of Scotland's land area by 2050 is an excellent and achievable objective and I sincerely hope that a lot of Scots pine and native hardwood species will be included.

A lot has been achieved and I pay tribute to the good work that the Forestry Commission has done over many years. The Forestry Commission certainly did a good job of managing forestry policy and Forest Enterprise before the devolution settlement, but I am not convinced that we need to retain that United Kingdom quango structure for ever. The minister has, as he said, started the process of reform, which I welcome. However, we may need to go further and I suggest that fresh legislation may be needed sooner rather than later.

The Scottish Executive environment and rural affairs department is at the heart of our Government and is fully accountable to the Parliament and to our Rural Development Committee. That is as it should be. The time may have come for forestry policy to come in from the cold and into the heart of our rural policies. The minister said that, but I think that we may need to go rather further than he suggests.

Scotland has the lion's share of Britain's forestry, as a number of members have explained.

I do not believe that it makes sense to leave administration and policy development for that important sector to a detached group of civil servants under a nominated board of commissioners. I must be careful what I say. Lord David Clark, the chairman of the Forestry Commission, is an old friend and I hope that he will not mind me making that point—perhaps I should discuss it with him later—but the debate must be had.

The Forestry Commission has done an excellent job during a difficult period of history. It replanted huge areas after the decimation of forestry during the first world war. A lot has been done, but the commission may have become an anomaly in post-devolution Britain. At present, the Forestry Commission is not part of our rural affairs department. It is nominally a free-standing United Kingdom Government department, which happens to have its headquarters in Edinburgh. It is led by a board of commissioners, who are collectively accountable to the three UK forestry ministers, with Chinese walls between the Scottish, English and Welsh territorial sectors in the Forestry Commission headquarters.

My most vivid memory is of the chief executive of the Forestry Commission presenting forestry ministers with the fait accompli of a big deficit in the Forest Enterprise account and leaving it to us to persuade our respective finance ministers to pick up the tab. We have inherited an odd chain of responsibility and it is right that we should have a radical review—I was going to say "a root-and-branch review", but my colleagues have persuaded me not to—of the way in which we govern that important sector in the context of the devolution settlement.

We should certainly develop United Kingdom co-operation on research and in other shared interests. That is valuable and must continue. However, I strongly believe that Scottish forestry policy should be one of the core responsibilities of our environment and rural affairs department. I am convinced that direct accountability would be better for the management of land use and environmental policy, now that the Parliament is firmly established.

Forestry and timber have a big future in Scotland. I urge the minister to bring forestry policy in from the cold and to bring the excellent people who worked up the Scottish forestry strategy into the heart of Scotland's environment and rural affairs department. The days of the pseudo-quango should have passed and we need to move on.

Christine Grahame (Scottish National Party, South of Scotland)

I lived for many years in a highly afforested area in Galloway and watched the landscape darkening under Sitka spruce. However, I found that there was little benefit for the local community and much by way of disbenefit. There was no processing and little direct local employment, but the local people suffered the disturbance and destruction of their environment. That experience is entirely reflected in the Scottish Borders, which has, in the Kielder forest, the largest afforested area in the UK.

I am glad to see Ian Jenkins in the chamber—late and one hour into the debate, but at least we now have a Liberal Democrat MSP from the Borders present. No doubt he was busy doing something else; I bear no grudges.

Although the Scottish Borders contains the largest forest in the UK, there is no processing of timber in the area. However, there is all the inconvenience. I refer the minister to my contribution—and that of my colleague in the Scottish Borders, Ian Jenkins—to the members' business debate in Aberdeen during the summer. We referred to the environmental damage to Borders villages and hamlets caused by heavily laden lorries rumbling through narrow streets. The issue of road improvements really will not matter there, because such narrow village roads cannot be repaired without being destroyed again by those lorries in any event.

The solution, although I will not dwell on it again—I hope that Mr Wilson is ready for this—is the development of the southern half of the Borders railway line, with a spur link to Kielder forest at the Riccarton junction. I was present during the statement this morning, when Margaret Curran said that she had an interesting diary. I suggest that Allan Wilson visit Riccarton junction to liven up his diary. He can travel to it on the track where the original railway line lay. The track is still there and it would be easy-peasy to put a railway line on it so that we can move the forestry trees directly on to trains. That appears to be the minister's policy and he could easily implement it.

George Lyon (Liberal Democrat, Argyll and Bute)

Will Christine Grahame take an intervention?

Christine Grahame (Scottish National Party, South of Scotland)

I will not take an intervention from George Lyon, although Ian Jenkins may interrupt me if he likes.

When Allan Wilson visits Kielder, perhaps he could bring the Minister for Enterprise, Transport and Lifelong Learning. If that is what he calls cross-cutting and partnership, I would like to see it in action. They could consider locating a processing plant there. It is an insult to people to surround them by trees without providing them with any of the manufacturing. A local processing plant would also, in part, remove the problems of environmental damage.

The second part of the SNP amendment deals with encouraging the use of indigenous wood materials locally. I learn from Scottish Enterprise Borders that wood fuels used for on-site heating can often compete with fossil fuels, particularly in rural areas where wood is available nearby. I am advised that equipment for converting wood into heat is relatively cheap and simple. Control systems rarely need to be sophisticated, hot water tanks provide temporary energy storage and it is easy to incorporate a standby heat source, such as coal, oil, gas or electricity—although piped gas is often not available to remote areas—for use when the wood fuel system is out of action for maintenance purposes.

I ask the minister to investigate—he might already have done so—what has been done to encourage small-scale heating schemes. I heard about the example that has been mentioned, but I would like to know where else small-scale heating schemes could be viable, not just for schools and local hospitals, but for prisons, country hotels, farms, industrial estates and cold stores. There is a whole range of uses for such heating schemes, on which Scotland unfortunately falls down in comparison with its Scandinavian neighbours.

I refer the minister to Borders Biofuels, which has identified housing estates in the north of England and in Scotland that are close enough to sources of forestry residues to be supplied with district heating from centrally placed boiler houses. The company is offering home owners free central heating system installation in return for a contractual agreement to buy heat from a central boiler for a set period. According to the company, the cost of heat will be lower than if the home owner bought and used fossil fuel. I ask the minister to look into that.

John Home Robertson mentioned the new Scottish Parliament buildings. The timber school in the Borders uses mature fallen trees—

John Home Robertson (Labour, East Lothian)

It is called Woodschool.

Christine Grahame (Scottish National Party, South of Scotland)

Yes. It uses those trees to make high-quality, custom-built furnishings. I hope that the procurement group will consider the materials that Woodschool uses. There are lots of good things going on.

Finally, I want to mention social inclusion. A team based at Glentress is working to help long-term unemployed people to improve their quality of life by using the availability of the forest. I wish such projects to be pursued.

Like my colleagues, I am concerned that the Executive has lodged an administrative motion rather than a substantive one. I ask the minister to reflect on the fact that, during the debate, I have not felt that either he or some of his back benchers—particularly those from urban areas—were taking the matter seriously.

David Mundell (Conservative, South of Scotland)

When the minister launched his glossy 40-page booklet that contains pictures of trees, I wondered at whom it was aimed. However, the minister's preface helpfully advises me that it

"is written for anyone and everyone".

I am sure that people will benefit from it.

I start on a positive note by reflecting on the international forest fest 2002, which took place in Lockerbie at the end of September. It was a tremendous event, not just for Dumfries and Galloway, but for Scotland. For the first time, a major international forestry exhibition and various international competitions on forestry activities were brought together. It was a great success for the area and it showed that forestry is a modern industry. People think that forestry consists of a guy going out in the proverbial checked shirt with a chainsaw. That perception is a real problem, as it does not represent forestry. Forestry is a high-tech, modern industry. Pieces of equipment on display at Lockerbie were worth millions of pounds. There was high-tech equipment not just for taking things out of forests, but for producing products. We must turn round forestry's image of being an industry of the past. If we can present forestry properly, it will be an industry of the future.

Attracting young people into the industry is important. I saw welcome developments in Dumfries and Galloway, at Howies in Dalbeattie and at the Stephen's Croft site between Lockerbie and Moffat, but it is disappointing that young people are still reluctant to work in the industry. We need to encourage them to do so and we must equip them with skills to add value.

Let us be honest: there has been considerable resentment in Dumfries and Galloway and other areas about the industry. Trees have been grown, but transportation issues have caused pain and it has been felt that no value has been brought to the economy. There have been welcome developments in the forestry cluster in turning the situation round and getting value into the economy, but we must get youngsters with skills into the industry to take advantage of that. That is a serious challenge.

I was present when the minister announced the agreed forestry routes plan for Dumfries and Galloway at the international forest fest 2002. Not for the first time, Dumfries and Galloway Council did not follow my advice. I would not have let the minister leave the site without committing money for forest roads. I would have locked him in the presentation tent until he had agreed that more money would be made available for roads.

The plan is welcome and sensible, but it is only part of the solution. An area such as Dumfries and Galloway, which is one of the most afforested parts of Scotland, cannot generate sufficient resources from its council tax base to tackle the enormous roads problems. I am startled to find myself almost agreeing with George Lyon. There must be national funding to the local authorities that are most affected by the problem.

Allan Wilson (Labour, Cunninghame North)

I accept that there is a need for increased investment in the rural road network to support the procurement of timber. As the member knows, we will invest £70 million over the next three years in the process and a further £20 million for assistance. How much more would the Tories invest?

David Mundell (Conservative, South of Scotland)

We would quantify the problem in cash terms and work with the local authorities that are affected to allocate resources. The minister should consider a community such as Eskdalemuir, which has 235 residents on the electoral roll. There are hundreds of thousands of trees in that area and the council cannot be expected to invest £15 million or £20 million in local road networks. There must be a mechanism for national support funding for roads into such communities.

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

Despite what the member says, does he accept that the Conservative Government scrapped the crofting counties roads scheme? Does he regret that move?

George Reid (Scottish National Party, Mid Scotland and Fife)

David Mundell has one minute left.

David Mundell (Conservative, South of Scotland)

As I have only one minute, I cannot speak about the previous or the future Conservative Government. The roads issue cannot simply be brushed aside and it cannot and should not be party politicised. With the doubling of timber production in the next few years, the issue is serious and must be resolved. I do not for one minute suggest that there is an easy fix, but resources must be made available, otherwise the current balance between communities and the forestry industry will come to a head and we will be unable to progress. There are road safety issues and the sheer destruction of the roads must be considered. Such issues must be grappled with if there is to be a truly vibrant forestry industry in Scotland.

Rhoda Grant (Labour, Highlands and Islands)

I welcome the opportunity to debate forestry. The nature of forestry is such that action that we take today will have long-term effects that will sometimes last for many generations. Therefore, we need to get our policies right for the future. If we agree a long-term vision for forestry, outcomes will be delivered many years hence. Species such as Sitka spruce provide a fast economic return, but we need to get the balance right in respect of native woodland. If such woodland is properly managed, it can create returns, albeit that those will not be in the short term.

There are many side-benefits of forestry—for example, visitor attractions and forest walks—and forest management must have regard to those benefits. It is important that such activities are encouraged and that everyone is allowed to benefit from forestry, not only economically, but socially. Knowledge of the environment can be increased and recreation and exercise provided. One problem that I have come across in that respect is the lack of joined-up government. That does not necessarily create barriers for large forestry organisations that have the resources to build relationships with all the agencies, but it can for small owners or community forests.

Forestry planting and management are supported through rural development grants, while local enterprise companies' responsibilities cover the creation of facilities for visitors, walkers, cyclists and educational trips. I am not criticising how the different agencies work to fulfil their obligations, but I am criticising the lack of a one-stop shop, which, if people are not used to working with many agencies, can be off-putting and can create barriers. Our policy must cover all aspects of forestry and make assistance and advice more accessible to smaller developers.

I want to discuss community ownership of forestry. Everyone is aware of the benefits that were brought about by community ownership at Abriachan and I am sure that we would want that model to be copied. I have been in touch with the North Sutherland Community Forest Trust. It is keen to see local ownership of forests such as Borgie forest, but Forest Enterprise does not seem to be encouraging that aspiration. Forest Enterprise is working towards a management agreement with the community, but that falls short of the goal of community ownership, which would allow the community to plan for the future and create jobs. One obstacle appears to be that the forest has a mature crop that is ready to harvest, but that obstacle could be overcome if Forest Enterprise handed over the forest to the community in stages following harvesting.

There are many ways in which communities can benefit from the ownership of forests. As has been said, they can look for uses for waste products and for new and innovative uses of native species.

Communities are more likely to take an holistic approach to managing forests and creating jobs. Large timber operators tend to be interested in harvesting timber, but they tend not to be as concerned with side-benefits, such as tourism or community business.

One side-benefit of forestry is the use of waste products for energy creation—that subject has been discussed this morning. I was interested in the fact that a project is being considered in Kinlochleven that will provide heating and hot water for 600 homes. The price of that scheme should equate to about half of what it costs to heat an average home in Scotland. The scheme would bring huge benefits to the community. We know that in rural areas there is not the same choice in energy. Most people are forced to use electricity for heating, which can often be expensive. We must encourage such projects. George Lyon mentioned the project in Argyll, which was supported by Communities Scotland.

We need to find more uses for native woodlands. A lot of work is being done to investigate how we can use low-grade timber. I pay tribute to Highland Birchwoods, which has examined the feasibility of using that type of timber for flooring and windows, for example. We must learn lessons from the past about how we manage native woodlands. If they were managed properly, the timber would be of higher quality and would obviously have better uses.

I know that many members have talked about transportation, but I want to add that we must consider transportation at the planning stage for forestry, not when the forest is ready to harvest and we find it necessary to have a knee-jerk reaction. In planning forestry and allowing forests to be created, we must feed into the local plan our views on how the forest will be harvested and how the timber will be accessed.

Alasdair Morgan (Scottish National Party, Galloway and Upper Nithsdale)

The problem is that that would have been fine 30 years ago, but the forests are now where they are and the likelihood is that most replanting will be on the same sites for obvious reasons of economics and ownership. Changing the planning process now will not give us a big advantage.

Rhoda Grant (Labour, Highlands and Islands)

That is not necessarily true. Given that we are trying to extend forestry cover in Scotland, an awful lot of new forests will be planted. I am not saying that the road that will take the timber out should be built before the forest is planted, but that consideration should be fed into the local plan—it has to be accepted as an issue that is up and coming. If we leave it to the last moment, we will have timber rotting on the ground with no way of extracting it. It is important that we address the matter.

I urge the minister to meet members of the North Sutherland Community Forest Trust to see whether we can take forward their aspirations. I would be pleased if he also took on board my comments on other issues.

Linda Fabiani (Scottish National Party, Central Scotland)

Having compiled a member's bill on forestry, I was particularly interested in the forestry devolution review. I would go so far as to say that I was quite excited by its final recommendations, because they were somewhat similar to my own thinking. That excitement was dulled by the watered-down stance that the Scottish ministers have taken.

I went a bit further than the review group's recommendations, in that, like Rhoda Grant, I wanted local communities to have a real say in what happens with the forests in their neighbourhood. However, our policies were similar. The policy of ensuring that decisions are taken at a level as close to the people as possible is known as subsidiarity.

I remember that Jack McConnell looked quite surprised when Kenny MacAskill told him that as First Minister he owned Inverness airport. The Scottish ministers also own Scotland's forests. The ownership of the forests was transferred under the Transfer of Property etc (Scottish Ministers) Order 1999 (SI 1999/1104). Article 4 of the order transferred

"all rights and interests belonging to a Minister of the Crown in any land in Scotland"

acquired under sections 39 and 40 of the Forestry Act 1967 and any property used for the functions of the Forestry Commission in Scotland, with the exception of the Forestry Commission headquarters in Corstorphine Road and the research offices.

Given that the Scottish ministers own the forests in Scotland, I found it surprising, to say the least, that they do not want to take real control over what are some of Scotland's most precious national assets. It is surprising that the Scottish ministers do not want to bring the management of Scotland's forests more transparently within the control of Scotland's people. I cannot see how the minister can justify leaving such a valuable Scottish asset in limbo. The position can easily be altered. Westminster legislation is not required. We already own Scotland's forests, so let us bring their operation back home. I ask members to support the SNP position and set up a forestry management structure in Scotland for Scotland. For the sake of the Scottish timber industry, let us be brave.

As I said, the ministers own the forests, but they hold them in trust for everyone who lives in Scotland. They should work towards making them forests for us all. I want a restoration of the public aspects of Scotland's forests. That is starting to happen in some ways with the central Scotland forest in my area and the Millennium Forest for Scotland Trust, for example.

I have read the booklet that the minister recommended—"Scotland's Trees, Woods and Forests"—and its foreword. The document represents a way forward and it is good that we are putting out that kind of publication. There must be a proactive reconnection of the people in the country with the assets of the country, such as forestry. We must be aware of how forestry issues and policy affect us all. For example, is the presence of vast conifer monocultures really the way forward for Scottish forestry? Should we not have more regard to the need for biodiversity? Should we think of our forests only as a cash crop? Why can we not turn the forests for which we have paid so handsomely through our taxes into a vast national resource for education, leisure, employment and other social and economic ends? I say that we can.

Allan Wilson (Labour, Cunninghame North)

I am confused about what Linda Fabiani is proposing. I understood that her draft bill intended to divide the functions of the Forestry Commission among local authorities, but that there was little appetite for that among local authorities or industry. She is now talking about a "vast national resource". How are the two ideas compatible?

Linda Fabiani (Scottish National Party, Central Scotland)

The minister is wrong. The proposal that he mentioned was one of the options that was outlined in my consultation, but the general thrust of the bill was to bring forests under some form of local control.

Education about our forests is important. I commend an initiative that has been started in Dalkeith, in Rhona Brankin's constituency—the world of trees initiative. I declare an interest, as I am a trustee of the charity that is promoting it. The initiative aims to make the forest an educational resource for young people, so that they can see the benefits that forestry brings to us all. A generation of children is growing up who cannot tell one tree from another. Adults are generally the same—I am certainly no expert.

The wildlife in the forests represents another huge learning resource, but it, too, is in danger. The minister mentioned capercaillie. There is a problem with declining stocks of capercaillie in the wild. We must look again at how we are managing that decline.

For the future of Scotland, for her people and for her environment, we must promote a new linkage between the people and the land. I hope that we can seize the opportunity now and move that forward.

John Farquhar Munro (Liberal Democrat, Ross, Skye and Inverness West)

We have heard about the history of the Forestry Commission and how much of an influence it is on everybody in the countryside. The Forestry Commission has, for a period in excess of 80 years, been a major influence on the Scottish economy, particularly on the rural economy where the Forestry Commission and its subsidiaries have provided jobs, homes and business opportunities that have helped to retain and sustain families and communities in many of the deprived and sparsely populated areas of our countryside.

The concept of the Forestry Commission was first launched in Scotland in 1919. It was established as a massive job creation exercise—and an excellent one it was. That followed the end of the great war and was an early attempt to promote the stated promise of a land fit for heroes.

From that simple beginning, the initiative has developed a vibrant economy. As we have heard, it has supported about 7,000 direct jobs in forestry and a further 3,500 jobs in timber processing, which together contribute about £800 million per annum to the Scottish economy. That is quite a success story and extremely good value for the annual subsidy of £33 million that the Forestry Commission currently receives for its activities in Scotland from the Scottish consolidated fund.

The Forestry Commission, as everyone will know, is responsible for the protection, expansion and promotion of Scotland's forests and woodlands. It has, in its wisdom, established a subsidiary company named Forest Enterprise, which is the commercial arm of the Forestry Commission and is responsible for the entire forest estate.

Apart from the main function of timber production and harvesting, Forest Enterprise has progressively developed its forests in harmony with the surrounding environment. It has created habitats for the protection of wildlife and is continuously extending its tourist and visitor facilities, providing woodland walks, cycle tracks, car parks, pony paths, picnic areas and so on, which all make a valuable contribution to our rural economy.

As Forest Enterprise continues to develop and expand, it is obvious that it will require additional financial support to achieve its targets and objectives. Much of its harvestable timber cannot be extracted over our deteriorating rural roads. Many of the plantations are inaccessible by road and Forest Enterprise has been forced to load timber onto barges and small coasters for direct delivery to the mill or railhead. While that is undoubtedly environmentally friendly, it involves expensive specialist equipment and expertise, which we should support through something like a dedicated marine freight facilities grant. In north-west Skye, in my constituency, Forest Enterprise has extracted by sea 17,000 tonnes of timber. That is quite an achievement in such a remote area.

I hope that the forest industry will come to have an even more important role in our rural economy. For instance, last month, signatories of the Kyoto protocol met in India to discuss international rules on carbon trading. The debate proposed an option to allow forest plantations, or carbon sinks, to be included in the carbon-trading scheme as a much-needed boost to the effort to find a solution to the problem of global warming. The protocol requires developed countries and companies to reduce CO2 emissions to 5 per cent below 1990 levels by 2008. A company that is unable to meet its targets can buy credits from a less polluting company or invest in less polluting operations. CO2 absorption by forest plantations, however, is not yet included, which is a great pity. The Scottish Executive must work with Forest Enterprise to encourage the British Government to promote the inclusion of forestry in the Kyoto protocol. Forestry could be a productive and innovative way in which to meet international commitments on global warming as well as of regenerating rural communities.

We have heard this morning that forestry in Scotland has been an undoubted success. We are indebted to Forest Enterprise for its diligence and foresight and we must continue to support its efforts in order that the next 80 years can deliver the same degree of excellence. I am pleased to support Allan Wilson's motion.

Trish Godman (Labour, West Renfrewshire)

I want to speak about the parts of the strategy that concern the contribution that forestry makes to the environment, the creation of opportunities to help people enjoy the trees, woods and forests and the ways in which we can help communities to benefit from that strategy.

We should all play a part in the campaign to preserve what is left of our native woodland and to recreate woods grown from our native trees such as rowan, birch and oak. With careful management, funding and the involvement of local communities, a great deal can be achieved. I was pleased to hear the minister remind us this morning of the £4 million announced in the spending review for forest recreation facilities, giving groups that are committed to improving our cultural heritage the opportunity to progress innovative ideas. Indeed, it was a project by the Scottish Woodland Trust that enabled me to give my grandson in Australia a present of 100 trees planted in the north of Scotland for him and his school. When Christine Grahame was talking about the Kielder forest, I remembered that it was on a walk through that forest that my husband proposed to me. I accepted and have lived happily ever after, so I could say that there is romance in them thar woods.

Local communities and schools should be encouraged to participate in the development of native woodland schemes, with the right kind of management and adequate funding.

I would like to make a plea for support for the planting of trees in our urban areas. Apart from the regrettable absence of shops and community centres in housing schemes that were built in the 1950s and 1960s, little thought was given to decent landscaping. The development of woodland in and around our towns and cities should be part of the new system of woodland management. Trees enhance any built-up area and might mask some of the awful 1950s and 1960s architecture. There is something dispiriting and cold about a treeless shopping, business or housing development. We should argue for tree-planting schemes in our countryside and in our towns and cities.

I welcome the minister's statement. There should be public participation in the management schemes. We must ensure that voluntary organisations that are doing a good job in relation to the replanting of our native woodlands, such as the Scottish Woodland Trust, are given the support that they need. However, we must remember that the right balance must be found between the complementary pressures on land use to ensure that the needs of agriculture, biodiversity, transport and forestry fit appropriately with access for leisure and tourism.

George Reid (Scottish National Party, Mid Scotland and Fife)

We are now down to speeches of four minutes. I call Robin Harper.

Robin Harper (Green, Lothians)

I am happy to declare my interests as a member of the Scottish Woodland Trust, Borders Forest Trust, and the Carrifran Wildwood trust. I am also an avid planter of trees: before being elected, I personally organised the planting of 1,000 trees in Craigmillar as part of an inner-city project and I have distributed, free of charge, many oaks from my back-garden Scottish oak nursery to friends and relations all over Scotland and England.

This debate has been excellent in that it has raised many issues around forestry of which the Executive must tak tent. However, one issue has been missed out. Of the members of the Transport and the Environment Committee, we have with us in the chamber no Conservative, Labour, SNP or Liberal Democrat member—no members of the Transport and the Environment Committee are present apart from me.

Rhona Brankin (Labour, Midlothian)

Will the member give way?

Robin Harper (Green, Lothians)

No, because I am making an important point. The absence of those members highlights the assumption that forestry is a rural development matter rather than an environmental one. Similarly, from the minister's speech we find that an issue that the Transport and the Environment Committee has been dealing with for four or five months has been left out: the water framework directive.

Page 24 of the document, "Scotland's Trees, Woods and Forests"—which, although it is not produced by the Executive, is typical of an Executive document in that it is 70 per cent pictures and 30 per cent content—draws our attention to the contribution that forestry can make to the terms of the water framework directive. The minister will also be aware of the policy suggestions that have been developed by the WWF in its wild waters directive.

John Home-Robertson said that forestry should be a core responsibility of the Scottish Executive environment and rural affairs department and I absolutely agree. However, is forestry integrated? The flavour of the debate so far suggests that one extremely important aspect of the huge opportunities for forestry to get engaged in development in terms of the water framework directive, particularly in relation to water quality and flood management—which is not to say that the water framework directive says that forestry must do that—has been missed. There was no sign in the minister's speech that the Executive is considering that as a core future development. Perhaps it is considering it and work is going on in the background. My criticism is that that is not being highlighted and was not highlighted in the minister's opening speech.

There is no doubt that this is the time to factor forestry development into the water framework directive; it must not be left until later. The same point can be made about agriculture: there is no sign that agriculture has been factored in. I throw a challenge into the Executive's lap. What will the Executive do on such integration? There is no sign of it at the moment.

Margaret Ewing (Scottish National Party, Moray)

In gentle chastisement of Robin Harper, for whom I have a high regard, I say that one does not need to serve on a committee to study or be interested in an issue that is debated in the chamber.

Robin Harper (Green, Lothians)

I was not criticising the members present.

Margaret Ewing (Scottish National Party, Moray)

I am sorry, but I am not going to get into a debate with Robin Harper. It is important to place on the record that all of us can be interested in subjects without necessarily being on a subject committee and that we should not chastise people who are probably working hard elsewhere.

In the short time that I have, I am pleased to participate in the debate, particularly as, for well-known reasons, I missed Alex Fergusson's members' business debate in Aberdeen on the timber industry. I read that debate with great interest, despite the painkillers that I was on at the time, and found many of the comments extremely helpful. Some of those comments have been reiterated in this debate.

My colleague, Alasdair Morgan, will close on behalf of the SNP. The Gallovidians have the most afforested constituency in Scotland, and the Moravians have the second most afforested constituency. Alasdair Morgan and I have therefore shared over many years opportunities to discuss forestry. We often had to fight in the House of Commons for the issue to be raised. Occasionally, we would get a question in to the Ministry of Agriculture, Fisheries and Food. Any debates that were held were usually late at night and also of short duration. However, the Scottish Office always replied to those debates, because it was considered the lead office on that subject in acknowledgement of the significance of the forestry industry to Scotland. I can make no comment about the Scotland Office, because I am not sure that it leads in anything these days. I will not develop that discussion, because I am sure that the Presiding Officer would rule me out of order.

I will pick up on a few points. I intervened on the minister's opening statement with a point on the processing of timber, which is vital. We seem to be giving ministers rather crowded diaries this morning—Margaret Curran and Allan Wilson will be extremely busy. Nevertheless, I suggest that the minister comes to Moray and visits James Jones and Sons in Mosstodloch, where we have an up-to-date, highly skilled sawmill and processing plant. Not a piece of the timber is wasted: the bark goes to garden centres, and we have all seen people such as Alan Titchmarsh and the Beechgrove gardeners use it. Allan Wilson could then visit Buckie harbour, where he would probably see more timber waiting to be exported to be pulped in the nordic states than he would see fish, which is an aspect that worries us in that area. Much more could be done to encourage processing in Scotland.

Little has been said about addressing the price of timber. It has fallen substantially—by approximately 25 per cent—in the past several years. Although I realise that the Executive has given some additional money to forestry and the timber industry this year, that money does not make a dent in that substantial price fall, which obviously has an impact on the industry's potential.

The minister spoke about the health, educational and recreational purposes of forestry. On his visit to Moray, he could visit Culbin forest, which is one of the most wonderful, most blissful places to visit. It surrounds the beautiful Findhorn bay. We have been talking about capercaillie, but we recently had a Pulp concert at Silver Hill, near Duffus, about forestry. That had a huge impact on the local economy. We have mountain bike fields near Fochabers, which young people run voluntarily and which have almost 50 members.

All those things are happening. We need a clear strategy to ensure that the industry progresses. We are all proud of it and we consider it an asset to Scotland, but for goodness' sake, let us get the strategy right and not leave the industry isolated with vague promises.

George Reid (Scottish National Party, Mid Scotland and Fife)

I call Alasdair Morrison and then Brian Fitzpatrick.

Alasdair Morrison (Labour, Western Isles)

In the few minutes that I have, I will dwell on the merits of the crofters forestry scheme. The minister will recall that, during his successful visit to my constituency during the summer, we discussed that scheme's merits. Since its inception, it has been a force for good, not only in the Western Isles, but throughout the Highlands and Islands.

I am sure that the minister will also recall that my Hebridean colleague, Calum MacDonald MP, was the one who successfully piloted the Crofter Forestry (Scotland) Act 1991 through the House of Commons. Since that act received royal assent, thousands of acres of trees have been planted in the crofting counties.

The importance of the crofter forestry scheme cannot be overstated. Whether the crofters carry out the work themselves or use forestry agents, it involves a great deal of community participation. The scheme has proved to be an excellent early example of community-based forestry. The benefits for crofters are varied. They include the availability of shelter for livestock around the croft and on the hill, the creation of wildlife habitats and small-scale timber production. Importantly, the scheme also allows crofters to diversify their agricultural activities and provides an alternative source of income.

Wherever there has been a scheme, it has guaranteed crofters and grazings committees a source of income. They first of all receive an establishment grant and then, for some 15 years thereafter, are in receipt of management payments.

In the context of Executive budgets, the sums of money are not spectacular. However, the crofter forestry money is literally transforming—and has transformed—the landscape. It is also transforming the fortunes of many villages and villagers in my constituency and throughout the Highlands and Islands.

Since the mid-1990s, grazings committees have received money for the first time since their inception. That money has been spent wisely and communally on schemes that benefit crofters and other village residents.

That is the history over the short period of some 10 or 12 years. The future of the scheme concerns me. I have some delicacies about the changes that are proposed to the woodland grant scheme. I agree with the change of emphasis to the regeneration of existing woodlands and away from tree planting.

However, the minister will recall from his visit to the Western Isles that many of the landscapes there are uninterrupted by trees. We, of course, point the finger directly at Tavish Scott's Scandinavian relatives, who, uninvited, visited the Hebrides over 1,000 years ago. I am sure that the minister appreciates that we cannot talk about regenerating existing woodlands in the Hebrides. We must talk about regeneration there in the sense of replanting and replacing what used to exist. I urge the Executive to take account of that obvious fact and ensure that the crofter forestry scheme continues in the Western Isles.

I endorse what Rhoda Grant said about Borgie forest. I urge the Executive to move on Borgie forest and ensure that the community is allowed to secure ownership and management of that forest. We have already seen the benefits of that throughout the Highlands and Islands, whether on Eigg, in Assynt or through the Stornoway Trust. North Harris—DV—will follow suit. The aspirations of the North Sutherland Community Forest Trust dovetail with our land reform proposals. I urge the Executive to move quickly on that.

I would wish to be associated with few issues that Alasdair Morgan raises, but I fully support his point about job dispersal, which he made in an intervention. Calum MacDonald MP and I have supported moves by Highland colleagues to have Scottish Natural Heritage's headquarters moved from Edinburgh to Inverness. I would urge the minister to move the Forestry Commission jobs nearer to the trees, as Alasdair Morgan put it, and to the communities attached. I would urge the minister to move those jobs from Corstorphine to Carloway.

George Reid (Scottish National Party, Mid Scotland and Fife)

I am sorry, but my screen has been playing up. For Brian Fitzpatrick, whom I had said was going to be next to speak, read Alex Johnstone.

Alex Johnstone (Conservative, North East Scotland)

I hope that that confusion will not be made often, Presiding Officer.

I have a couple of topics to explore. First, I will do the traditional regional thing and point out that forestry is an important part of the rural economy in the north-east of Scotland. It provides direct employment in tree nurseries and in timber management and production. It is also important indirectly, through associated businesses such as tourism, for example. It is estimated that about 1,330 people are employed in the forestry industry in Aberdeen City and Aberdeenshire. Although production in the area is currently below 400,000 tonnes a year, that figure, as is the case in the rest of Scotland, is forecast to double over the next 10 years.

There is real potential for creating jobs in the industry, but one or two things must be addressed—and are being addressed extensively—by Aberdeenshire Council and Aberdeen City Council, which have been working together on a review of the joint indicative forestry strategy. It is hoped that the final version of the strategy will be submitted to the Scottish Executive this month. The Executive has possibly received it already.

Throughout the latter part of the 20th century, timber planting has resulted in Aberdeenshire's having about 92,000 hectares of woodland, which represents about 14 per cent of the total land area. The forest resource varies from about 18 per cent of the land in Donside and Deeside to less than 7 per cent in Buchan. The two councils' indicative forestry strategy identified Banff and Buchan as being the preferred area for new planting, which has helped to secure Forestry Commission support for the planting of well designed, productive forests.

The key issue that the forestry industry must address for the north-east, as for the rest of the country, is that of transport. It is extremely important that roads are maintained. In particular, we need links for moving around Aberdeen, and I make no apologies for mentioning Aberdeen's need for a western peripheral bypass.

There has already been an enormous effort in transporting timber by rail—although perhaps not by sea. Timber has started to be delivered to a railhead at Inverurie recently, which has taken a great deal of timber off the main road south, via Aberdeen. The problem is that taking timber away by rail takes it out of the area for processing elsewhere. We want the timber to be processed in the area. If that means moving timber from the area to the north of Aberdeen, where there is considerable production, to the south of Aberdeen, where there is processing capacity, then it needs to get past the city of Aberdeen. At the moment, the road network is simply not up to that. If the Deputy Minister for Environment and Rural Development could have a word in the ear of the Minister for Enterprise, Transport and Lifelong Learning, I would be most obliged.

Secondly, the environmental impact and contribution of forestry has been the subject of debate. At this point, I give my full backing to the minister for his support for the red squirrel. It is a bit like the issue of seagulls, which some people do not take very seriously. The demise of the red squirrel is something that none of us would like, and the environment that forests create in the north and north-east is the last bastion in the defence of that species.

While on the subject of the environment, I would like to apologise for the non-presence of John Scott, our environment spokesman and Transport and the Environment Committee member, at the debate. He was scheduled to take part, and would have done so gladly had he not had to withdraw at the last minute.

Robin Harper (Green, Lothians)

Will Alex Johnstone accept that my earlier remarks were in no way meant as a chastisement of my colleagues on the Transport and the Environment Committee? I presume that colleagues would have been here if they had been asked to be here. My comments were on the party approach to what is a rural affairs issue.

Alex Johnstone (Conservative, North East Scotland)

Indeed, I fully accept that. I will, however, make one final remark on the environmental aspects of forestry. There are many sirens among this audience that are trying to bring the minister round to the idea that forestry is almost exclusively an environmental issue. For areas such as the north-east and the south-west, forestry is very much a commercial issue. While the Conservatives accept that the environmental aspects are important, the commercial aspects are also extremely important in many regions. I support the minister's environmental principles. I am, however, disappointed by the absence of other aspects of forestry in the motion, so I gladly support the Conservative amendment, which highlights the issues of real priority to the forestry industry in Scotland.

George Reid (Scottish National Party, Mid Scotland and Fife)

We now come to winding-up speeches. Members should keep to their allotted times, and make their speeches a little shorter if possible. Jamie Stone, for the Liberal Democrats, has four minutes.

Jamie Stone (Liberal Democrat, Caithness, Sutherland and Easter Ross)

This has been a wide-ranging debate, and I congratulate Alex Johnstone on going to both ends of the spectrum: from red squirrels to the Aberdeen western peripheral bypass, amazingly enough. That is the nature of the debate, however.

In response to an intervention during his opening speech, Allan Wilson touched on job dispersal, which is hugely important. He spoke about community initiatives, to which I will return when I mention Linda Fabiani's speech. We have also heard about redundant fences, red squirrels and the importance of forestry to the Scottish economy. Whether the correct figure for the industry is 11,000 or 10,000 direct jobs is neither here nor there; we know that an awful lot of jobs are involved and we know how important they are.

Fergus Ewing highlighted roads, to which I shall return at the end of my speech. He also touched on the parts of the SNP amendment that deal with biomass. I was particularly interested in his thoughtful comments on encouraging increased use of wood in the building industry. Having spoken informally to him after he made his speech and having learned that he was referring to timber framing, I endorse his remarks entirely. We can go further; it would—whether we are talking about building regulations or the tweaking of planning regimes—behove the Parliament to make positive moves in that regard.

I congratulate the new willowy figure of Alex Fergusson who has done extremely well; he has lost a great deal of weight recently. He clearly feels passionately about the forestry industry, which he described as an industry that is "firmly on its knees"; however, none of us can take anything away from the sincerity of his remarks. I am sorry about any problems that he has had with delayed postal services.

George Lyon was right to highlight the importance of the rail network and the movement of timber by sea. He talked about investment in the future and thinking ahead. He talked about getting imports down from their present level, which is far too high; that is a laudable aim.

David Mundell was absolutely correct to address the image of the forestry industry. I do not think that many of us think that people working in it still wear lumberjack shirts, but the industry has to be made a more sexy and convincing career choice. Indeed, it can be a very suitable career.

Linda Fabiani and Rhoda Grant both spoke about community involvement. I whole-heartedly endorse Linda's remarks on the county of Sutherland. She also talked about the involvement of the young, as did David Mundell. The school outings and walks that are being developed in forested areas are good, but we could go a lot further.

John Farquhar Munro gave us a comprehensive overview of the history of the Forestry Commission, and discussed what could be done in relation to the Kyoto protocol, and Margaret Ewing rightly highlighted timber processing. We heard about the sawmill at Mosstodloch and about the export of timber through Buckie. She is absolutely right to say that sawmills have been closing—at least throughout my lifetime—and that trend could and should be reversed.

Alasdair Morrison, to my surprise, mentioned the Vikings. We will leave that to one side for the moment, however, while I endorse the remarks that were made about roads. I am grateful that the minister acknowledged concerns on the subject in response to an intervention. We require a fund that local authorities can bid into because, as the minister is aware from my correspondence, there is in my constituency a huge problem with the roads—one from which we cannot walk away.

Jamie McGrigor (Conservative, Highlands and Islands)

Although I am sure that the Forestry Commission will see advantages in the strategy review, the one thing that stands out is the call for value for money. With that in mind, we must hope that the grant schemes will concentrate on key priorities.

The emphasis appears to have shifted from growing and harvesting timber to the development by Forest Enterprise of partnership projects such as the Dalriada project in Argyll. Forest Enterprise has linked with British Waterways and voluntary community groups in promoting environmentally friendly schemes for the public good. Those schemes are good and I am all for the public good. On the public good, I note that one of the documents mentions tackling deer problems and that the minister spoke about the value of wildlife. I hope that Forest Enterprise will consider red deer and roe deer as an asset rather than a menace and will immediately stop its scandalous policy of incessant year-round slaughter of those species, which are a priceless part of Scotland's natural heritage. If those species are managed properly, they can be incorporated into forestry policy.

The main issue is that more attention should be given to making the forestry industry a more robust player in the Scottish economy. Now that there are three separate countryside agencies in Great Britain, it is essential that they operate with minimum bureaucracy and that duplication of services is avoided. For example, a single unit provides machinery and vehicles for Forest Enterprise throughout Great Britain, which works efficiently. The system must stay efficient. If we want a good forestry industry, we must tackle the practical problems that hinder it.

I will make five points, the first of which is on transport. I ask the minister to consider specifically the Argyll timber transport group's bid—which has twice been refused—for a grant to produce more haul routes on roads of the group's making, which would remove pressure from public roads. The Executive should promote payment of more freight facilities grants by building new piers and maintaining old ones in areas where timber can be transported by sea. I am thinking of places such as Loch Striven, Craighouse on Jura and Bunessan pier on Mull. The transport of timber by sea saves huge Government expenditure on the damage that timber lorries do to roads.

Secondly, as the Scottish Executive cannot see the wood for the trees, we had better thin the trees. The point of the forestry grant scheme must be to produce quality saw-log timber from the existing forestry crop and to improve forests' commercial quality. We need good productive forestry plantations. The Executive should look to Belgium and Austria, which offer generous grants—supported by the European Union—for non-commercial thinning, which is essential to the production of quality timber.

Thirdly—and very important—there is not a level playing field in relation to grant allocations to Forest Enterprise and to the private sector because new planting is not taken into consideration. Although private companies have created 10,000 hectares of new planting, Forest Enterprise has planted only 100 hectares. That is a sad reflection of the fact that state-run enterprises continually receive Government support at the private sector's expense.

Fourthly, Scotland should use forestry for biofuel. The scheme at Whitegates in Lochgilphead is the first district scheme of that type in Scotland. Under the scheme, 48 homes are heated by wood chips from local forestry. There is a central boiler and the users are metered individually. In Malmö in Sweden, the homes of 100,000 people—half the population of the city—are heated in the same way. I point out to Robin Harper that such schemes do not involve fossil fuel, but carbon-neutral fuel that is endlessly renewable, which is what he likes. I wonder why he did not mention that scheme because it is a key point and is based on the principle of biodiversity.

The practice is similar to that carried out centuries ago on the hillsides around Loch Lomond, where timber was coppiced on a 20-year cycle to make charcoal. The new system combines an age-old product with modern technology to create a non-polluting benefit. If enterprises such as the Whitegates scheme were given the benefit of the non-fossil fuel premium, which goes to other renewable sources such as hydro and wind power, there would be a rush to create a new industry in Scotland.

Finally, the Executive should support any initiative to bring a new pulp mill to Scotland and to create a biofuel plant alongside it. Scotland has an enormous paper-making industry. It is ridiculous that the Arjo Wiggins Carbonless Papers Ltd site in Fort William makes high-quality paper with 100 per cent imported pulp in an area that is surrounded by forestry, but there is no doubt that the company would prefer to use local pulpwood.

In Scotland, the timber and customers exist, but the methods must be changed. Scotland needs three forest products: quality saw-logs, biofuel timber and pulpwood. That is how to make the forestry industry profitable.

Alasdair Morgan (Scottish National Party, Galloway and Upper Nithsdale)

I represent what is either the most forested constituency in the country or the second most forested one. There is a question as to whether Galloway and Upper Nithsdale or Argyll and Bute has that particular honour. Either way, there are a lot of trees nearby.

I re-emphasise my earlier point about the dispersal of Forestry Commission jobs. In the past few years, there has been a loss of jobs in rural areas through the closure of Forestry Commission area offices. So, far from jobs being dispersed, we have a smaller proportion of them than we had some years ago.

Allan Wilson (Labour, Cunninghame North)

I am a supporter of jobs dispersal, but we must appreciate the fact that the Forestry Commission is a cross-border public authority that has a Scottish headquarters and that there is a danger that dispersal in a GB context would mean a net loss of jobs from Scotland.

Alasdair Morgan (Scottish National Party, Galloway and Upper Nithsdale)

Indeed. However, the forestry devolution review, which we are meant to be discussing today, recommends dispersal of jobs from the commission's headquarters to the various national offices. Given the fact that the Executive has accepted that, I presume that that will happen in any event.

During the minister's wide tour d'horizon—which covered everything from the review to the grey squirrel population to roads and tourism—he said very little about the devolution review, although it is meant to be the main subject of the debate. The review is a fairly dry document, however, so perhaps that is just as well.

We have had a wide-ranging debate in which many subjects have been raised. It was rather inventive of Alex Johnstone to introduce the Aberdeen peripheral route, but I suppose that everything is fair game. Fergus Ewing raised some good points about roads—to which I shall return—and biomass. We are interested in the example of the use of biofuel in Lochgilphead, although that demonstrates how slow we are in getting to where we want to be. I would like the minister to comment on the way in which the provisions north and south of the border seem to militate against developments in biofuel. Fergus Ewing also mentioned certification problems in relation to promotion policy, and the promotion of the use of timber in building.

Several people—notably Alex Fergusson—raised the issue of bureaucracy, particularly as it surrounds applications for future development. The conclusion that we are coming to is that, although the words are fine, there seems to be a lack of urgency to implement the policy. The strategy is fine, but is it being pushed forward? If it takes eight months from request to fruition to arrange a meeting, sufficient urgency is not being given to what is being done.

I echo members' comments on the importance of the forestry industry to rural areas. Nevertheless, its importance is not always immediately obvious and there is a problem of perception. Christine Creech—

Christine Grahame (Scottish National Party, South of Scotland)

Do not call me that.

Alasdair Morgan (Scottish National Party, Galloway and Upper Nithsdale)

I apologise—old habits die hard. Christine Grahame mentioned some of the disadvantages of forestry to people in rural areas. There are problems with water quality and fishing, which I was going to mention before Robin Harper spoke. Many of the rivers in Galloway are blighted by acid problems that are caused partly by insensitive tree planting. There are also the problems of road traffic and the look of many of the forests. The problems are made worse by the fact that many of the forests are owned by private owners who live hundreds of miles away from them.

There is an additional problem in that the employment benefits to contractors and drivers are not necessarily experienced by the people who live next door to the forests and who may object to future forestry developments. It is important to get communities on our side in talking about the development of forestry. I regularly receive mail on two main issues with regard to forestry. The majority of complaints are about timber traffic passing through villages and causing danger and damage. Where large timber lorries pass through villages at fairly high speeds, often in convoy, that causes considerable alarm.

Alex Fergusson and others also raised the issue of certain areas of forest becoming landlocked because councils have introduced weight limit orders to preserve what remains of the fabric of roads. That problem must be resolved, otherwise we will throw away the value of forestry, not just to the firms that carry out forestry—including the Forestry Commission, which is the biggest of those firms and which we own—but to the nation. We will throw away the value of our investment in forestry if we cannot harvest it.

Despite my intervention, I agree with Rhoda Grant that a priority in new forestry developments must be to look to the future and consider how the trees will be taken out when they reach maturity. However, our main problem over the next 10 to 20 years will be existing forests, many of which were planted without consideration of how they would be removed.

The minister referred to the use of rail, but there are currently few railways in rural Scotland. In addition, rail transport is only economic over long distances and there is the problem of antiquated infrastructure; many places have old railways and sidings. The principal rail company—English, Welsh & Scottish Railway, or EWS—appears to have lost interest in the forest product sector. Unless substantial train loads can be provided regularly over long hauls, rail is not a significant option.

I echo what John Home Robertson said about the Forestry Commission probably being an anomaly in a devolved Scotland and that direct accountability would be better. The review group's report makes that clear. Therefore, I am disappointed that the Government is not considering legislative action to change the situation and is continuing on the anomalous course of simply tinkering with administration.

The Government's major contribution to forestry and forest products has been to produce glossy documents that use the products of the forestry industry. The Government must do better.

Allan Wilson (Labour, Cunninghame North)

I thank members for an interesting debate. I think that there is broad agreement among members about Scotland's general direction of travel in relation to forestry. That agreement was emphasised by Alasdair Morgan's speech. However, there are inevitably different views about precisely how we should get there and the weight that we give to different priorities.

I chide Christine Grahame slightly by saying that it is not true that my colleagues and I do not take the forestry industry seriously. I am not sure whether forestry is sexy, as Jamie Stone suggested it should be, but forests can be fun. [Laughter.] I am serious. The glossy document—"Scotland's Trees, Woods and Forests"—to which Alasdair Morgan referred and to publication of which I plead guilty, states that Scotland's forests have 361 forest walks, 110 picnic sites, 94 cycle trails, 55 horse-riding routes, 14 orienteering routes and so on.

The £4 million investment, which I believe has been welcomed throughout the chamber, will promote the leisure and recreational uses of forests. That will advance Scotland's economy and create jobs in the leisure and recreational industries and should be welcomed by all. In my job, I devote a great deal of my time, energy and commitment to promoting the importance of Scottish forestry in the Scottish economy. I will continue to do so and if the list of visits that arise from the debate on the matter is anything to go by, I will certainly be busy in the coming period.

I think that we all acknowledge that important challenges face Scottish forestry. First, there is the problem that is posed by the low price of timber, to which many members referred. We cannot ignore that, but as members will know, I cannot interfere with international exchange markets. However, we must recognise that forestry is, as Alasdair Morgan said, a long-term business and that, in a real sense, the resources that we commit to forestry now will benefit future generations. Therefore, I want to draw attention to policies on new plant and growth.

We are also keen for forestry to be more closely integrated with other land uses in Scotland. An essential feature of the new administrative arrangements for forestry is that the national office for Scotland will be more closely involved in policy development in related areas of Executive business. Members referred to obvious examples of that and I referred earlier to integrating the activities of the Forestry Commission more closely with the enterprise objectives of promoting jobs in the tourism, leisure and recreation industries.

John Home Robertson talked about effectively abolishing the Forestry Commission. That was an option in the devolution review, but I did not favour it. The proposed changes will bring forestry policy in from the cold, as John Home Robertson wants, through a strengthened national office for Scotland.

Apart from certain aspects of international representation, forestry is fully devolved, but it makes good sense to take advantage of the economies of scale that can come from operating across the larger market of Britain. That is never clearer than in relation to research. Someone—Christine Grahame, I think—suggested wrongly that we could do that without primary legislation. Even if such a move were desirable, legislation would be required both in this Parliament and Westminster.

On investment in roads, when I challenged David Mundell to say how much more the Tories would invest than we are currently investing, the result was silence. That is understandable, because the Tories failed signally to invest in roads during their tenure in office. I take the point that in order to gain value from the product we must ensure that it can get to the market. I also accept that in order to achieve that, we must invest in the roads infrastructure in rural areas. However, I believe firmly that the way to achieve that is to give additional resources to local authorities, so that the local authorities can then engage with the industry in their locality. Through the timber transport groups and through the timber transport forum, progress can be made in devising strategies and plans for getting the product from the forest to the market.

The use of wood fuel in new housing developments was mentioned by Fergus Ewing and others, including Christine Grahame and Rhoda Grant, and I agree firmly with them that the matter is important. George Lyon provided the Parliament with an example of that from his constituency. I can tell members that the Executive is involved in preparing a scheme to encourage the supply of wood fuel from forests to end-users. We are funding a large partnership project to quantify the size and location of the wood fuel that can be obtained from traditional forests and from mill co-product as well as from biomass in towns and transport corridors.

Robin Harper (Green, Lothians)

Will the Executive issue advice to local authorities? I know from my meeting with Torren Energy Ltd that, despite receiving help from one place, it found had difficulty getting local authorities to appreciate its ideas.

Allan Wilson (Labour, Cunninghame North)

I will certainly consider that, because it sounds to me like a good idea. I know that the local authorities in my constituency have been involved in discussions that have taken place involving the forestry industries cluster, Clydeport and Forestry Enterprise about a new wood fuel power plant, but it might be appropriate to issue more general advice.

Having given Robin Harper that assurance, I will perhaps also chide him somewhat because I made extensive reference in my opening speech to the importance of forests to our natural environment. The Forestry Commission will of course work with the Scottish Environment Protection Agency on the new water framework directive. Indeed, if Robin Harper is not already aware of it, he should know that new guidelines on forests and water that reflect the directive are now out for consultation. It is for members to feed into that consultative process.

Fergus Ewing (Scottish National Party, Inverness East, Nairn and Lochaber)

On the use of wood for power generation, there has been much talk about the prospect of coal-fired power stations being run on coal and wood. If that became a reality, would the minister accept that such a development would create a substantial market for wood that could be provided from Scotland and from south of the border? Does he accept that that would make a huge contribution to the consumption of the wall of wood that we will see shortly?

Allan Wilson (Labour, Cunninghame North)

I accept the general point that the advancement of new biofuel production technologies presents tremendous scope for the use of wood in conjunction with other fuel sources and that that would create great opportunities for the industry.

Before I took that intervention, I was about to say that the new grants scheme to which I referred in my opening speech will offer higher rates for riparian wood, which is wood that is grown alongside rivers and burns.

Alex Fergusson (Conservative, South of Scotland)

rose—

Allan Wilson (Labour, Cunninghame North)

I cannot take any more interventions, but I will try to deal with the points that Alex Fergusson raised. I recognise that the member reflected the industry's desire for relaxation of the 40-hectare limit for the grants schemes—perhaps that was the point on which he wanted to intervene. We need to be cautious until the forward commitments settle down. We have made strenuous efforts to maintain annual payment rates in the face of falling farm incomes and we have agreed annual limits, which we will relax when it is sensible to do so. A question was also raised about the environmental impact in a certain part of Ayrshire, which I am not in a position to comment on, because if the applicant chooses to appeal they will appeal to Scottish ministers. The grant scheme is being developed in partnership with the industry, environmental bodies and local authorities. The Executive has accepted all their recommendations. It is a Scottish scheme, and it will remain so.

Rhona Brankin asked whether the northern research station was safe and I am happy to announce that it is. The quinquennial review has concluded and there is no intention to relocate that station.

George Lyon raised important points about the positive contribution that the processing industry makes, and the proposed second line at the Caledonian Paper plc factory in Irvine, which is close to my constituency. It goes without saying that we are doing all that we can to help the company to make the case for investment in Scotland, rather than in other parts of Europe that might be in the frame for the investment. My colleague Iain Gray has been in constant contact with the company and has travelled overseas to ensure that Scotland's interests are being reflected.

It is unfortunate that Margaret Ewing is not here, because my final point is about added value and timber. I agree with most, if not all, of what she said. Although little of our timber is exported before processing, members throughout the chamber share the aim that we should endeavour to ensure that as much timber as possible is processed in Scotland so that the value that is added to our timber product is retained in Scotland.

Business Motion

George Reid (Scottish National Party, Mid Scotland and Fife)

The next item of business is consideration of business motion S1M-3549, in the name of Patricia Ferguson, on behalf of the Parliamentary Bureau.

Motion moved,

That the Parliament agrees—

(a) the following programme of business— Wednesday 13 November 2002 2:30 pm Time for Reflection followed by Parliamentary Bureau Motions followed by Stage 3 of Debt Arrangement and Attachment (Scotland) Bill followed by Parliamentary Bureau Motions 7:00 pm Decision Time Thursday 14 November 2002 9:30 am Scottish National Party Debate on Poverty followed by Scottish National Party Debate on Crime followed by Business Motion followed by Members' Business—debate on the subject of S1M-3522 Johann Lamont: Regulation of Private Security Firms 2:30 pm Question Time 3:10 pm First Minister's Question Time 3:30 pm Executive Debate on National Cultural Strategy followed by Parliamentary Bureau Motions 5:00 pm Decision Time followed by Members' Business—debate on the subject of S1M-3416 Shona Robison: Licensing Scheme for Fireworks Wednesday 20 November 2002 2:30 pm Time for Reflection followed by Parliamentary Bureau Motions followed by Stage 1 Debate on Protection of Children (Scotland) Bill followed by Financial Resolution in respect of the Protection of Children (Scotland) Bill followed by Parliamentary Bureau Motions 5:00 pm Decision Time followed by Members' Business Thursday 21 November 2002 9:30 am Stage 1 Debate on Title Conditions (Scotland) Bill followed by Financial Resolution in respect of Title Conditions (Scotland) Bill followed by Business Motion 2:30 pm Question Time 3:10 pm First Minister's Question Time 3:30 pm Executive Debate on Scottish Executive Response to Foot and Mouth Disease Inquiries followed by Parliamentary Bureau Motions 5:00 pm Decision Time followed by Members' Business

(b) that the Justice 1 Committee reports to the Justice 2 Committee by 19 November 2002 on the Discontinuance of Legalised Police Cells (Ayr) Rules 2002 (SSI 2002/472);

(c) that Stage 2 of the Water Environment and Water Services (Scotland) Bill be completed by 11 December 2002 and that Stage 2 of the Public Appointments and Public Bodies etc. (Scotland) Bill be completed by 17 December 2002; and

(d) that the Preliminary Stage of the Robin Rigg Offshore Wind Farm (Navigation and Fishing) (Scotland) Bill be completed by 24 January 2003.— [Euan Robson.]

Motion agreed to.

David (None, Lothians)

Before we start, I welcome the honourable Marcel Riera i Bou and Mr Luc Van den Brande, the chairs of the European affairs committees in Catalonia and Flanders respectively. They are here to meet our European Committee. [Applause.]

Question Time — SCOTTISH EXECUTIVE — Social Work and Social Care (Careers)

Des McNulty (Labour, Clydebank and Milngavie)

To ask the Scottish Executive what steps it is taking to promote social work and social care as career options. (S1O-5848)

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

The national recruitment and awareness campaign was launched on 22 October. The campaign aims to raise the profile and to highlight the value of social care and social work, and to start to address issues of staff recruitment and retention.

Des McNulty (Labour, Clydebank and Milngavie)

Clydebank College in my constituency has three very successful programmes that provide training for people who wish to work in social care. It has three equally successful programmes for people who wish to work in child care. The proportion of males involved in all those programmes is less than 10 per cent—in an area of very high male unemployment. What is the Executive doing to ensure that there is a better gender balance among those who are trained to work in social care and child care?

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

I welcome the work that Clydebank College and other colleges are doing to increase the opportunities that are available to all people who want to work in social care and child care. The member may be interested to know that last week, at the Men in Childcare conference, I made it clear that when additional funding was announced—particularly funding related to early-years work—I would write to local authorities and child care partnerships to ensure that we seek to create opportunities for men to work in jobs that might traditionally have been seen as jobs for women.

Christine Grahame (Scottish National Party, South of Scotland)

I refer the minister to the report into the social work breakdown in Scottish Borders that resulted in failure to prevent extensive sexual abuse of a lady with learning difficulties who is known as Miss X. Is the minister aware that some workers in Scottish Borders Council had 100 cases on their books? One worker was responsible for 120 cases. That has led Scottish Borders Council to advertise to recruit nine social workers. How confident is the minister that, given the current deficit of social workers, those places can be filled urgently?

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

I thank the member for indicating over the airwaves of the BBC at lunch time that she intended to ask a question along the lines of the one that she has just asked. I am concerned to ensure that, where cases are unallocated, we get people into posts to take them on. We must ensure that we recruit enough social workers and enough people who are interested in social work for the training courses that are available. This year we increased the amount of money that is available for bursaries. Although there has been an overall increase in the number of qualified social workers, that has not kept pace with demand. I take the issue very seriously, and we will continue to address it.

Lyndsay McIntosh (Conservative, Central Scotland)

Given that, as the minister has just indicated, the demand for social workers far outstrips supply, surely we should not concentrate on recruiting only men. People must be appointed on merit. Anyone with the right talents and skills should be welcome.

Cathy Jamieson (Labour, Carrick, Cumnock and Doon Valley)

The people who enter social work should want to do such work. That is important for building relationships between social workers and particularly vulnerable people. However, most of those who become involved in social work and social care have been women. Unfortunately, in some instances, younger people are not being attracted to fill posts. Our campaign is to recruit people of all ages and backgrounds, and to ensure that we recruit enough people to do the very valuable jobs that need to be done.

David (None, Lothians)

Question 2 has been withdrawn.

Gil Paterson (Scottish National Party, Central Scotland)

To ask the Scottish Executive what health and safety standards for pupils are applicable in schools. (S1O-5831)

Nicol Stephen (Liberal Democrat, Aberdeen South)

In addition to any other duty that is owed under statute or common law, an education authority must take reasonable care to ensure the safety of pupils under its charge.

Gil Paterson (Scottish National Party, Central Scotland)

Does the minister agree that it is not acceptable for our children to be educated in schools or fed in dining rooms where fungus is growing in the roof? If so, what action is he likely to take in North Lanarkshire? Greenhill Primary School in Coatbridge faces exactly the problem that I have described.

Nicol Stephen (Liberal Democrat, Aberdeen South)

First, I want to be clear that I do not regard that as acceptable. I do not think that any member in the chamber would find it acceptable. In relation to the school estate throughout Scotland, we recognise that there is a need in some cases to take urgent action. We have significant proposals to improve the school estate. We are about to embark on the most significant investment of more than £1 billion through the schools public-private partnership programme, which was announced earlier this year. North Lanarkshire's share of that will be new capital investment of £150 million for the first time. None of that would be possible with the SNP's position on PPP spending.

Brian Fitzpatrick (Labour, Strathkelvin and Bearsden)

The minister will be aware of my extensive correspondence with him on the oversight of children on school activity trips and my concerns about the relationship between the Health and Safety Executive, the Adventure Activities Licensing Authority and local authorities. Will the minister tell us what steps will be taken to ensure that Scotland keeps pace with the innovations that are being delivered for adventurous activities in the rest of the country?

Nicol Stephen (Liberal Democrat, Aberdeen South)

We will keep in close contact with what is happening in that area in England and Wales. We want to learn lessons from the good work that is taking place there. I am prepared to consider the outcome of the work and, if necessary, take appropriate action in Scotland.

Alex Fergusson (Conservative, South of Scotland)

To ask the Scottish Executive what steps it is taking to monitor the progress of Eaga in delivering its remit in relation to the central heating installation programme. (S1O-5820)

Hugh Henry (Labour, Paisley South)

The Scottish Executive currently monitors all aspects of Eaga's performance in delivering the contract for the central heating programme. We monitor how Eaga applies the rules of the scheme, how it maintains quality control and deals with complaints and how it meets the targets set for it. That ensures that the programme continues to provide the best possible service to Scotland's most vulnerable households.

Alex Fergusson (Conservative, South of Scotland)

I am grateful to the minister for that answer, but I understand that local partnership managers say that the average waiting time for the installation of central heating under the programme is around six months. Does the minister agree that it is totally unacceptable that an applicant from the Stranraer area, who recently contacted me, has had to wait for central heating since 11 September 2001, when he made his application? Does he agree that many applicants are unable or unwilling to pursue their applications vigorously in the way that the applicant whom I mentioned has had to do and that the Executive's monitoring processes should be reviewed forthwith?

Hugh Henry (Labour, Paisley South)

The member's constituent had to wait during 18 years of a Tory Government that never got anything done. Since this Government came to power, a number of things have happened that are helping the very constituents about whom the member spoke, not least the central heating programme. We should celebrate the success rather than concentrate on some of the inevitable problems that come with a scheme of such significance.

Some 7,000 households are waiting for heating systems and we recognise that one of the results of the success of the scheme is the fact that the demand creates difficulties. We are working hard to tackle those difficulties and to get the programme through as quickly as possible. However, there is a limit to the number of available heating engineers and to the number of heating systems that we can install. I would rather have the problem of having to apologise for the delays, which people clearly find frustrating, than have to say that there is no delay, because there is no system, which is what would have happened if the Tories had got back into power.

Duncan McNeil (Labour, Greenock and Inverclyde)

Does the minister welcome the fact that Eaga has put in place a parliamentary officer who will be able to deal with complaints on behalf of constituents, rather than having them wait a month or more for a question to be selected here that would not help them?

Hugh Henry (Labour, Paisley South)

Eaga has considered a number of measures to help to improve the system. We should emphasise the fact that it met its target. It installed 3,559 central heating systems in the year 2001-02 and is on target to install 5,000 systems this year. We are happy with its performance. We will consider problems as they arise, but let us celebrate what we have achieved.

Alasdair Morgan (Scottish National Party, Galloway and Upper Nithsdale)

Surely this is not a case of one or the other. We are quite happy to celebrate what has been achieved, but the fact is that many people are dissatisfied. The central heating programme is the biggest single item in many members' postbags. On many days, I write more letters to Eaga than I write to the local council. That is saying something, so will Mr Henry keep pursuing the matter with Eaga?

Hugh Henry (Labour, Paisley South)

I must put the issue in its proper context. Like other members, I have received queries from constituents, asking why things are taking so long and whether the process can be speeded up. Equally, as a constituency MSP and as a minister, I have received a huge number of responses in which people have said just how pleased they are to have had their lives transformed since the introduction of the scheme. It is important to maintain a degree of perspective. We will try to tackle the problems that arise but, by God, I would rather have problems than not have such a scheme at all.

Bristow Muldoon (Labour, Livingston)

To ask the Scottish Executive how it is promoting the responsible growth of air travel in and to Scotland. (S1O-5851)

Iain Gray (Labour, Edinburgh Pentlands)

The Scottish Executive has on-going discussions with its agencies—the enterprise networks and VisitScotland—about the promotion of air links serving all parts of Scotland. We are committed to ensuring that the rising demand for air travel brings maximum economic benefits, at minimal environmental cost, to all Scottish airports and the communities that they serve.

Bristow Muldoon (Labour, Livingston)

I encourage the minister to continue to work with those agencies to enhance the links between Scotland and major European cities. Does the minister accept that improved journey times for intercity rail travel might represent the most sustainable way of improving Scotland's transport links within the United Kingdom?

Iain Gray (Labour, Edinburgh Pentlands)

It is clear that a combination of the two modes of travel is necessary. The greatest symbol of such a combination is our commitment to improve the rail links to Glasgow and Edinburgh airports. New routes are also important, because direct air routes make it less necessary for many passengers to travel from Scotland to London, which offers an environmental advantage.

Margaret Smith (Liberal Democrat, Edinburgh West)

I welcome responsible growth in capacity at Edinburgh airport, but to achieve responsible growth in air travel we must include the option of quality public transport links to reduce congestion. Will the minister tell members when the preferred option for the Edinburgh airport rail link will be announced?

Iain Gray (Labour, Edinburgh Pentlands)

As Margaret Smith is probably aware, we are considering a shortlist of four possible routes for the Glasgow and Edinburgh airport links. We still hope that preferred routes for those links will emerge from that process before the end of the year.

Alex Neil (Scottish National Party, Central Scotland)

I want to ask what the minister is doing to promote low-cost flights between Scotland and Europe in two specific cases. In the follow-up to the Scotland in Sweden event, what is he doing to establish a direct air link between Stockholm and Scotland? Will he examine the funding structure of Inverness airport, which acted as a barrier to achieving an agreement with Ryanair on establishing low-cost services into Inverness?

Iain Gray (Labour, Edinburgh Pentlands)

The member has asked two questions in one. To some extent, I answered the first question in my initial answer. I am well aware of the interest that has been stimulated in a direct link to Sweden. As Mr Neil probably knows, there is a direct link between Scotland and Sweden, but it does not operate all year round. That is one of the routes that we continue to discuss with the enterprise networks and VisitScotland. Scotland in Sweden was an enormous success and many people felt that, if progress could be made, an air link between Scotland and Sweden would be a good outcome.

There has been much discussion about Inverness airport. The fact is that the £21 million that we give to Highlands and Islands Airports Ltd ensures that there is an Inverness airport. It is HIAL's responsibility to negotiate a commercial deal with Ryanair or with any other operator. Without that £21 million, which is a tripling of the subsidy that we provide to Scotland's airports, neither the low-cost flights that already operate from Inverness nor the more important lifeline services around Scotland would exist at all.

Bill Butler (Labour, Glasgow Anniesland)

To ask the Scottish Executive what monitoring mechanism is in place to assess the effective implementation of the free concessionary travel scheme for elderly and disabled people. (S1O-5812)

Lewis Macdonald (Labour, Aberdeen Central)

The Executive works jointly with other partners through the concessionary fares working group to oversee implementation of free local off-peak bus travel through local schemes.

Bill Butler (Labour, Glasgow Anniesland)

I thank the minister for his answer. The minister will be aware that there has been a general welcome for the free concessionary travel scheme, which is financed by the Executive to the tune of £70 million. It is a popular innovation.

The minister will also be aware of the recent case involving two of my constituents, John and Lily Hind, who are both in their 70s, who were deposited on the roadside at Ballachulish, 14 miles from Fort William, because Scottish Citylink refused to allow them to pay for a ticket for what would have been a new journey outwith the scheme's boundary. Is the minister concerned at the lack of common sense displayed by the bus operator and at what would seem to be an inflexible application of the issued guidance? Will the minister undertake to share that concern with Strathclyde Passenger Transport, which administers the scheme, and urge SPT to review the advice issued to bus operators?

Lewis Macdonald (Labour, Aberdeen Central)

I am aware of the specific case that the member mentioned. I have no doubt that the working group that is considering the implementation of the scheme will take such issues into account. However, it is for SPT, as the agency administering the scheme, to set the rules for the scheme. It is for SPT to work with the bus operators to ensure that the bus operators are fully aware of the rules of the scheme and how they should be applied.

Adam Ingram (Scottish National Party, South of Scotland)

That is not an isolated incident. Is the minister aware that since the advent of the scheme there has been a whole new practice of shoving grannies aff the buses in favour of paying customers? What will the minister do to stop that kind of discrimination?

Lewis Macdonald (Labour, Aberdeen Central)

I am aware that Citylink and other operators give priority to passengers who pre-book. That would be the same whether we were talking about long-distance coaches, air travel or other forms of travel. The incidents to which Mr Ingram refers are cases of that kind.

It is important that we are clear about the purpose of and the basis for our support for free local off-peak bus travel through the existing concessionary fare schemes. From the outset, it was made clear that the purpose of introducing such schemes was to close the opportunity gap and to allow the majority of weekly and daily journeys that are made by our pensioners and old people to be made for nothing. That is what the scheme is designed to achieve.

That is why we believe that the scheme should be implemented by local authorities through existing fare schemes. We will continue to work with local authorities, including Strathclyde Passenger Transport, because they are best placed to judge how to implement local schemes.

Phil Gallie (Conservative, South of Scotland)

Does the minister agree that the concessionary fare scheme will allow elderly people to travel free to Prestwick airport to join the new scheduled flights to Malaga, Nice, Rome and Palma that were announced today?

David (None, Lothians)

The minister will gather that Mr Gallie was not called during the previous question.

Lewis Macdonald (Labour, Aberdeen Central)

I gathered that, and I am glad that Phil Gallie has taken the opportunity to support our approach to integrated transport.

Karen Whitefield (Labour, Airdrie and Shotts)

Is the minister aware that some bus operators are refusing to provide free bus travel to some of my elderly constituents who want to take up their entitlement? What can be done to ensure that bus operators comply with the conditions and terms of the scheme?

Lewis Macdonald (Labour, Aberdeen Central)

Again, as I said in my answer to Bill Butler's initial question, I recommend that Karen Whitefield takes up that matter with Strathclyde Passenger Transport because it is the administrator of the scheme. It is my understanding that all operators in the area should be signed up to the rules of the scheme. Those rules cover journeys of the kind that she has described and so it is for SPT to ensure that the bus operators are aware of how they should interpret the rules.

David (None, Lothians)

Question 7 has been withdrawn.

John Farquhar Munro (Liberal Democrat, Ross, Skye and Inverness West)

To ask the Scottish Executive what the current position is with the award of contracts for official veterinary surgeon services in the Highlands. (S1O-5842)

Mary Mulligan (Labour, Linlithgow)

The Meat Hygiene Service is undertaking a retendering exercise for official veterinary surgeons throughout Great Britain. The aim is to ensure the highest levels of food safety and to deliver the service at a competitive price while maintaining quality.

John Farquhar Munro (Liberal Democrat, Ross, Skye and Inverness West)

I thank the minister for her response. Will the minister raise the issue with her colleagues in London and seek to delay the award of the new meat inspection contract until a proper best-value review has been carried out, which I believe will support local vets retaining the contract? Will the minister also ensure that the new contract will provide the same level of meat inspection service as is currently provided to abattoirs throughout the Highlands and Islands?

Mary Mulligan (Labour, Linlithgow)

The member will appreciate that it will be difficult to renegotiate contracts that were only awarded on 18 October, but it is possible for local vets to seek locum work for the OVSS and to seek new contracts, which may become available in future. As I have said, the intention behind the tendering process was to ensure that the highest possible quality of food safety was achieved. A determination of the ability of each contractor to achieve that was part of the tendering process. We can assure John Farquhar Munro that the highest quality will continue to be delivered.

Jamie McGrigor (Conservative, Highlands and Islands)

We are led to believe that the occurrence of tuberculosis in cattle is on the increase in several areas of Britain. With the continued rundown in the numbers of state vets, will the Scottish Executive make certain that there are enough vets to deal with the increased testing that may be required due to the rapid advance of the disease?

Mary Mulligan (Labour, Linlithgow)

As far as I am aware, there is no increase in outbreaks in Scotland. However, we will continue to afford a service that monitors the situation. Surveillance is part of the system that the state veterinary service offers to ensure that diseases such as tuberculosis are contained, and eradicated where possible.

David Mundell (Conservative, South of Scotland)

To ask the Scottish Executive what support and guidance it now provides in relation to the disposal of dead horses. (S1O-5814)

Ross Finnie (Liberal Democrat, West of Scotland)

I am unable to give the member any assistance as to how one might dispose of Conservative party leaders— [Interruption.] If anyone is flogging a dead horse it is certainly not the members on this side of the chamber.

The Animal By-Products Order 1999 requires that the carcases of fallen animals, including horses, be disposed of by one of the methods specified in the order. Those are rendering, incineration, dispatch to knackers' yards or, in very limited circumstances, burial or burning on-farm.

Specific guidance on the disposal of fallen animals is contained in the Executive's document "Prevention of Environmental Pollution from Agricultural Activity", which is circulated widely to the agricultural community throughout Scotland.

David Mundell (Conservative, South of Scotland)

As the minister and his coalition partners know very well, the Conservative party will never die. [Laughter.] Alas— [Interruption.]

David (None, Lothians)

Order. Could we get back to the dead horses, please? [Laughter.]

Ross Finnie (Liberal Democrat, West of Scotland)

We already are.

David Mundell (Conservative, South of Scotland)

Alas, horses do die. Is the minister aware that with the introduction of the ban on burial, which comes into force in April, the closure of the Dumfriesshire hunt and the lack of rendering facilities, it will not be possible to dispose of a horse carcase within Dumfries and Galloway? Will he undertake to include horses in any uplift scheme that is introduced for cattle and sheep carcases, and will he undertake to consult equine interests on how that might be implemented?

Ross Finnie (Liberal Democrat, West of Scotland)

There are two issues. The member is already aware that the number of horses that were sent to the hunts was a very small percentage, so that does not materially affect the situation.

On the new regulations, it is my understanding that Incineration Scotland, which is based in Dumfries, has confirmed to Executive officials that it is prepared to collect fallen horses, so there is no question of a lack of a facility.

On a general policy to deal with the implementation of the new European Union animal by-product regulation, we are in discussions with the industry and all associated parties with a view to trying to find a solution for a national collection service.