Good morning, and welcome to the 27th meeting in 2022 of the Economy and Fair Work Committee. There are no apologies from members, although Colin Beattie, the deputy convener, will be joining us about 10 o'clock. Our first item of business is a decision to take item 3 in private. Are members content? Our next item of business is an evidence session with the Just Transition Commission. The purpose of this morning's meeting is to provide members with an introduction to the work of the commission. I welcome Professor Jim Ski, chair of the Just Transition Commission, who is joined by Elliot Ross, head of the Commission's Secretariat. As always, I ask members and witnesses to keep answers and questions as concise as possible, and I invite Professor Ski to make an opening statement. Thank you very much, convener. We really welcome this opportunity to come and speak to the committee. I apologise for not being here in person at the moment. Five members of the commission were in Egypt last week for COP 27 and, frankly, are still in recovery mode at the moment. What I thought I would use the just these introductory remarks for is just to say about what we think about the concept of Just Transition, and then just say just a little bit about how we're planning to take this forward at the moment. Now, the surprising thing is that, if you look for a definition of Just Transition on the internet, you will not find one. Basically, the ILO, the international labour organisation that led on the concept, has a set of principles that are basically about fairness of outcome and process, but they don't actually trouble themselves with the definition. In our first report of the First Just Transition, we said that the imperative of Just Transition is that we have policies that ensure the benefits of climate change action are shared widely, while the costs don't unfairly burden the least able to pay or whose livelihoods are directly or indirectly at risk when the economy shifts and changes. The key points about that emphasises opportunities from the net zero transition as well as potential difficulties and risks. It also implies a wider scope. It's not just about getting out of coal or getting out of oil and gas. We would cover, for example, the agricultural and land use sectors and the impacts of the change on consumers and their ability to pay, so quite a wide scope. When we produced the First Report 18 months ago, we had 24 recommendations and all, but they were clustered around four themes. The first one being the need for planning so that everybody is operating off the same page. The second one is on the importance of upskilling and the transference of skills. The third one is on engagement with stakeholders that are affected. Fourthly, it is a consideration of the distribution of costs and benefits. Importantly, it is also a recommendation that there would be a minister for just transition. Of course, the Scottish Government accepted all those recommendations, and we now have Richard Lochhead in his role as the minister for just transition. As we have moved into the second phase, the game has changed a bit. In phase 1, it was essentially operating at a strategic level. Now, we are much more talking about implementation and delivery, and that provides a new set of challenges. It is also a busier landscape with a minister and the commission. On how the commission positions itself, I looked at my personal appointment letter that I received from the minister, which talks about taking a strong, healthy challenge function, carefully scrutinising planned and underlying assumptions before decisions are taken. Basically, the function of the commission's new phase is advice to the Scottish Government and scrutiny in progress with advancing things. The elements of our work plan are working towards just transition sectoral plans, which will cover energy, buildings and construction, transport, agriculture and land use, and a place-based one for the Grangemouth cluster. The question of engagement is still on our agenda. We have had five meetings this year, and the latter three have all been placed based in Aberdeen, Blantyre and in the Outer Hebrides. We have a big attention to monitoring and evaluation. How do we measure the progress towards just transition? We are also asked to co-ordinate with other relevant bodies, which includes the Committee on Climate Change, the Fair Work Convention. On where we have got to at the moment, we are still finding our feet in this new phase, but just three challenges have come up. First of all, we had originally anticipated that the just transition sectoral plans would come sequentially, and the minister appointed our membership on that basis. We had a number of commission members who would be there for the entire Parliament and some who would be on a fixed term to cover the production of each just transition sectoral plan. In fact, those just transition plans are now all going to be in parallel rather than sequential, which means that we have had to rethink our governance a little, so we are placing a bit more emphasis on establishing working groups for each topic, in which we can co-opt members. We are, once again, struggling with the breadth of the agenda of just transition, which we might get on to. In 2023, we are going to be very busy with the just transition sectoral plans. It leaves less scope for the cross-cutting topics that we hoped we would be able to cover. We are going to need to be a bit more selective, and we will be having a strategy meeting at the beginning of next month to work through those issues. Finally, the challenge is the relationship with the new minister. That was not something that we had in the first phase. We are just working through, I will say, to what extent is the advice that we are giving proactive, are we defining the agenda, and to what extent are we responding to requests from the Scottish Government? I have probably gone on a bit too long, but I might make one more remark. It is just a flat coming back from Egypt last week. It was remarkable how Scotland is still in the international spotlight. We had five commission members there. I can say that our activities were spontaneously mentioned in the context of the global stocktake for the Paris agreement by various countries and members of international organisations such as the international labour organisation. No pressure on us. People have quite a lot of high expectations, and we know that we have to deliver over the next three to four years, but maybe I will stop it here. Thank you very much, Professor Ski. You have raised a number of issues that I am sure members will want to ask questions around. You have spoken about the sectoral plans, and I think that we were due one towards the end of this year on energy, being the first one that has anticipated. You have spoken about commission members and strategies and all that, but do you feel that there is enough action and activity taking place? Or are we still at very much a planning stage because the targets that we have to reach are by 2045? Is there enough balance on the actual actions that have been in place rather than just strategies? I think that it is very to say that there is a big sense of urgency about that. That is an explanation as to why the first plans might need to be produced in parallel rather than sequentially. We are expecting a skeleton just transition sectoral plan for energy by the end of the year on which we will be providing advice when we see what the skeleton looks like. The expectation is that all four of the first just transition sectoral plans would come out in 2023. Elliot is more in day-to-day touch with the Scottish Government on those issues. I do not know whether Elliot has anything to add there. I assure good morning committee. My expectation is that the draft plan for energy will be published before the end of the year, and there will be a formal consultation period open at that point, in which the JTC will make a submission. I think that there will be further engagement before that plan is finally published at the end of next year. Professor Ski, you made some comments to wonder at the end that you raised some questions around what the role of the just transitions commission is. There should be a lack of clarity now on what is expected of commission members. There are just a few lines in the terms of reference for the commission. There are a few lines in the terms of reference for the commission that talk about the need to provide advice and scrutiny. The broad direction is quite clear. The scrutiny will come mainly on the just transition sectoral plans, and that is quite clear. We need something from Government to which we can react. However, in terms of the advice, the debate is how much of a proactive role in providing advice on questions that the Scottish Government has not posed to us. The mood of the commission at the last meeting was that we should very much take up that proactive role. You also mentioned measuring progress. How do we measure progress? We have a target of 2045, so how do we chart and measure progress towards that? When will that start? As we are talking about 2023, as we have the sectoral plans, there will be consultation on the sectoral plans. The time for activity is probably around 2025, a 20-year timescale. Are there targets? How will progress be measured during that period? We really need to work on this monitoring and evaluation aspect of it. The Scottish Government has held one stakeholder meeting with a set of consultants, and I understand that a second meeting was postponed while they worked out where precisely to take it next. The commission has offered the Scottish Government assistance in identifying benchmarks and indicators that would help us to measure progress. We have had a positive response from the Government on that one, but it is absolutely critical that we have indicators that are very specific things. They might be, for example, changes in labour markets, training, impacts of electricity prices and gas prices on different classes of consumer. The kind of things that would allow us to measure the fairness and distribution of the opportunities and the risks associated with the transition. It is really important to do that. The analogy there would be with the role that the committee in climate change plays with respect to the more quantitative aspects around emission indicators, et cetera, whereas the indicators that we would pursue would be much more about how we would get there and what the impacts are on fairness and equity. Again, I do not know if Elliot wants to add anything to that. Just maybe to underline that there is a section on the high-level priorities that the commission has set out around the work that they have done. I hope that the Scottish Government would be taking forward on monitoring and evaluation. However, the commission, as it is currently constituted, is not, per se, a monitoring body, but there could be a space for such a body on just transition outcomes and processes in the future, if I suspect. I am going to move to Maggie Chapman in a second, but one final question was tied to benchmarking. The decision on what to benchmark does lead to an understanding of what just transitions means. Do you feel that there is a shared understanding across Government and policy makers around what the benchmarks are expected to be? Is it too broad a term or is there an understanding of what we should be looking to measure? Maybe if I can come in this. I think that the understanding is still at a very broad level at the moment. We really need to get down to very specific indicators. One thing that the commission has discussed internally is that the monitoring and evaluation must be quite closely tied to stakeholder engagement, because we need indicators that people feel are relevant to them, not just indicators that are cooped up by consultants or other people. Therefore, we see a strong link between the monitoring and evaluation and the stakeholder engagement side. Professor Ski, you referred to an engagement event in Aberdeen. Is that part of that work? It was not part of that work. What we do is, for each of the committee meetings, we try to get out of Edinburgh in Glasgow, the central belt, and hold the meetings in places that are relevant to the topic under consideration. When we went to Aberdeen and Peterhead, we were looking at the issue of carbon capture, utilisation and storage. That was the theme of the meeting and that was the location. We visited the built environment sustainable transformation place at Bluntire, where we were thinking about building and construction. That is the kind of theme. I think that we would need different kinds of events to open up the monitoring and evaluation agenda. Good morning, Professor Ski. Thank you very much for your opening remarks and what you have said so far. I am interested in exploring an issue that you raised in the first phase of your work. You talked about planning being one of the focusses, planning and strategic thinking for the future. We have heard calls in addition to the calls that you have made around the clarity needed or perhaps a potential lack of clarity around the pipeline of work that we need to transition to net zero. I am interested if you think that we have done the work needed to understand the detail across the different sectors, across the different elements. Do we have that level of detail, or is there still quite a lot of work to understand where we want to get to? Never mind how we get there. Frankly, I think that a lot of more work is needed on that point. In our report that we produced in July this year, we were very keen to get an initial report out to set out our stall in the early stage of the commission. We called for an energy roadmap as part of an energy sector just transition plan, with quite a lot of specificity in it—for example, annual indicators—so that people would understand where they are going. When the draft just transition plan for energy comes out, that will be the kind of thing that we will be looking for in that. Am I coming through? From the perspective of most of the commissioners and our report, I think that there is quite a lot more work that needs to be done in that space. I suppose that one of the things that I am conscious of—a potential pitfall or a potential problem—is that if we see just transition as something separate from working alongside Scotland's other economic and social priorities, are there dangers of viewing just transition as something not foundational and core to our entire economic planning and strategic thinking? Similarly, are there dangers of viewing the work that we need to do around adaptation as separate as a distinct thing, not something that we look at when we talk about in the just transition space? If I could come back on that one, we have already established a number of working groups that are looking at cross-cutting issues apart from the sectoral plans. One of those working groups is on social infrastructure. That would very much try to connect to the just transition agenda to wider concepts of wellbeing, for example, that ties it in elsewhere in the economy. We have a separate group on finance, which would also be cross-cutting. One of our challenges for next year is the time that we have available to invest in those cross-cutting topics given the pressure of work that will come from scrutinising the just transition sectoral plans. The point of adaptation has been raised. Just to say that this is a conversation that has been taken place, I have had a conversation with the Scottish Government where there was a keenness to bring adaptation within the framework of just transition, as well as the mitigation and emission reduction opportunities. We would need to discuss that a little bit more in the commission to understand whether we have the expertise to do that. It might well tie into the question of social infrastructure and the ability to cope with the kind of physical impacts of climate change. It is on the agenda, but it is not built into our work plan at the moment, I should say. In the conversations that you have had within the commission but also more broadly with the Scottish Government and other stakeholders, do you think that there are any policies or proposals that are potentially red herrings? Given the time pressures and what we know are going to be very financially constrained times ahead, are there things that we maybe need to move away from doing? We know that we can get better impact and better outcomes from focusing on other things. Are there red herrings, I suppose, is what I am asking? I guess that one of the challenges that we have there is that 2045 is just so ambitious, the net zero target. There is a tendency to spring the place just transition around, as though it is magic dust that makes everything easy. It is not easy, and we need to be very clear about that. It is very difficult to drop some of the challenges off the agenda without actually posing risks to the achievement of the 2045 target. The big, big topics in 2045 are obviously the further development of renewable energy, and I think that that is well under way at the moment. The tricky one is the question of energy efficiency in buildings and the implications through for fuel poverty, which is a major one. Many commissioners are still struggling with the question of agriculture and land use, in particular the interaction with land reform, because there are very interesting incentives or disincentives in that area that need to be addressed. Of course, all those dimensions have implications for equity on labour markets, in particular the movement away from old energy, if I can put it that way for oil and gas, the new energy with renewables, where the challenges are large. However, 2045 net zero is so ambitious that it is very hard to leave anything off the table. Good morning. I absolutely appreciate the complexity and the challenge of what you are trying to do. I am entirely sympathetic to that. One of the two areas that I often major on are around the inclusion of women. I just wanted to ask a question about that. I recall that, for COP26, the First Minister described the Scottish Government as a commitment maker, and that commitment included enabling women and girls to lead a just transition to a green economy. I am fully cognisant of the complexity of that, so I really just wanted to ask for a progress update. I note the very eminent women that you have on your advisory committee, but an update would be appreciated, thank you. We are gendered balanced on the commission, and that was something that was very consciously driven for. From my perspective, that is working really well. The question is also how gender works into some of the substantive topics that the commission is addressing. I think that it is important that there are skills and education to ensure that girls are brought into STEM subjects, for example, where the demand for skills is very high. Some of the initial discussions on social infrastructure that I was talking about were noting the fact that women are quite well-represented in sectors such as social work. Believe me, the subject has been haught on the commission itself. We are gendered balanced, but we are also talking about the subject in quite a conscious kind of way. Therefore, following on from that, will there, in terms of any measurement outcomes, will there be a specific measurement referencing gender equality or cut through all your outcomes? Is there another way to do it, but will there be specific measures? I think that the way to approach that would be in terms of specific measures. For example, if we were looking at labour market outcomes or looking at progress with skills and training, then introducing a specific gender element into that would make absolute sense. Once we have those underlying facts, perhaps we can put together a larger narrative about where further progress is needed. I will look forward to following that up. My last question around this area, and I have another one as well, is in terms of conditionality. Can you see a set of circumstances where you will be advising conditionality in gender parity to the Scottish Government, because often it sees hard measures in real financial outcomes that make the difference? We have not discussed that issue in the commission so far, but thanks for planting the thought, because we could well do that. In terms of things like conditionality in general, we have actually discussed issues such as local content requirements and public procurement. The subject of conditionality has been on the table for us. It has not yet been applied to gender equality, but you have very helpfully planted that thought there. Another question is a completely different area around financing. Everybody is well aware of the significant challenges of financing, particularly if the Scottish Government, in terms of fixed budget. Even in the private sector, there are challenges around financing and risk appetites change, where there is no shortage of resources. I just wanted to get a sense from you—I am well aware of the challenge that you have, and you have already made it clear about 2045. What are your current reflections of those challenges, specifically on how the Scottish Government will be able to finance things, and other areas that you see across the piece? Retrofitting might be something that you would pull out. Financing requirements are large and investment levels would need to go up to get to that 2045 target. Quite frankly, we know that the Scottish Government, or any Government, does not have deep enough pockets just to pay for everything. I think that the area in which our colleague Nick Robins, who specialises on finance on the commission, would emphasise the fact that the challenge is to use public sector finance cleverly to leverage up financing from the private sector. That needs some attention to the risk. Basically, the public sector would need to take some of the risks out of the projects to provide the confidence for the private sector finance to come in. I think that there are a lot of tricky issues to be addressed here. Some of the best progress in Scotland has been made in terms of social housing, where you have housing trusts that can take very active activity. It is much tougher in the question of owner occupiers in the private rented sector, where the challenges are bigger. Quite frankly, if you are going to be fair about it, because some of the owner occupiers will be getting the benefits of lower bills in the future, they should be expected to put up some of the money for it as well. Those are all the challenges that we look forward to when we see the draft plan on buildings and construction and can really get our teeth into it. I feel as though this is an absolutely massive area, so I am not going to labour it because everyone else wants to come in committee. Graham Simpson, to be followed by Colin Smyth. Thank you very much, convener. Good morning to the witnesses. I start off by saying that it has been incredibly refreshing to read two reports from the commission, which are written in plain English. We are not used to seeing reports from bodies like yours, so that is a note of praise. I want to ask you about transport, because transport is mentioned in both your reports from 2020 and indeed this year. In the initial report that you produced this year, you talk about a broken transport system. It is quite tough language. A broken transport system, you say that Scotland's public transport network requires vast improvement and must be made more affordable. It requires significant investment from Government and re-prioritisation of funds. I wonder whether you can expand on that. I will ask you some more questions about what you have said. I will pass over to Elliot on that in a second. I want to flag that moving to electric vehicles is part of the solution, but it is absolutely not all of it. I have to say that electric vehicles is one of the areas where we pay attention in terms of who pays, because they are expensive things to buy up front. People on lower incomes may not be able to take the benefit of them because they find it more difficult to raise the money. The question of electrification of transport is there, but a lot of the comments on that came from perceptions about the public transport system. Obviously, one of the threats after the Covid crisis was, in a sense, the degree of confidence in public transport went down. It is a very important part of the picture that, if we were going to get to net zero in 2045 and get a credible contribution from the transport sector, we would think that public transport would have to play a significant part of it. It is just to flag things such as rural bus services, for example, where it may be less appropriate for people to have electric vehicles. One of the prompts was from the visit to Peterhead in the north-east earlier this year, where it was noted that Peterhead was one of the largest towns in the UK that does not have access to the rail network, and there could be implications there if you are trying to develop big projects for not having that kind of rail access. I do not know if Elliot wants to come in on that, because I think that he was more closely involved with the transport working group that brought up some of those recommendations. Yes, thanks, Jim. I think that just to underline a couple of other factors that were front and centre in terms of the deliberations that the working group went through. As I think that you will have seen from the report, the thinking there is really around some of the opportunities that the commission was able to see when thinking about what does a decarbonised transport system look like for Scotland and what should it look like for Scotland. Some of the other issues, as well as those that Jim mentioned there, are crucially around accessibility about having a transport system that is fit for purpose for door-to-door journeys for people with disabilities. The north-east was highlighted as a structural risk, the lack of a rail link to Peterhead in particular was pinpointed, and then the remote and rural point as well. That was underlined in the commission's visit to Lewis back in October when we heard about the consistent issues that islanders experience with transportation, and particularly the risk that it poses to businesses such as Shellfish, for example. There is a high level of risk there when transport systems cannot be relied upon to deliver for them. I read the section where you focus on the rural parts of Scotland and how poorly-served they are in many respects. You mentioned ferry services in the report. You have obviously been out to an island. I just wonder what you… It cannot all be about money, can it? Do you have any thoughts about how we might restructure the transport system? That is a big question, of course. Elliot, can you throw me a lifeline on that very big question? I think a little bit, as Jim has said in relation to one of the other plans. On a question like that, the commission is far the work that the commission needs to do, particularly in terms of how the commission looks to respond to the draft transition plan for transport, so that the commission is clear on what the Scottish Government has in mind, and then can look to increase the Government further. That was a very short answer, Elliot. Do you try to wriggle out of that one? Let's assume that the… Just to say, as secretary, it's difficult for me to… I can only convey the views of the commission as they've been discussed and agreed, so I really wouldn't want to go beyond that into anything that's felt more speculative territory for me. Maybe I could just add to that. It's also not possible, even if you're a chair, to give the commissions on views that the things that we haven't talked about. That initial report that we sent out in the summer was very much to stake out the territory. We felt that it would be wrong to wait for 18 months for our first annual report to come out, so it is not a deep dive into the particular topics. The transport working group, for example, may have discussed in a bit more detail what the transport issue is, but what is there in that initial report is pretty much what we've got so far. Okay, that's fair enough. Can I just ask you one more thing, then, on that transport section? You say that you think there should be an overhaul of regional and local public transport provision and infrastructure. Did you go into any detail on that? What is it that you mean by that? I'm afraid I'm going to have to pass to Elliot on that one again, who I think was involved with the transport working group much more than I was. Yeah, I think just to say again that these are initial very high-level strategic peers from the commission on this, with the intention of digging into a lot more detail as we review the transport transition plan from the Scottish Government. Okay, I'll leave it at that. Okay, thank you. Colin Smyth will be followed by Gordon MacDonald. Excuse me, thank you very much, convener, and good morning to the panel. The commission and many others have consistently called for greater clarity around the pipeline of work that's required to transition to net zero. Do we have a good understanding of the level of detail that is necessary to deliver the certainty that the industry is calling for on what work will be needed in order to deliver? Yeah, I mean, I think that if you take the energy sector as an example, I mean, what we're going to need to know is the kind of roll out of offshore and onshore wind so that we get a clear idea of the amount of construction activity that's actually going to be needed. I think it's possible to do that. It depends a bit on the leasing kind of process that we see, because obviously that's done competitively. But once you've got that in place, I think that you've got a few years ahead on which to plan things. I think that it would be very fair to say that our union colleagues on the commission, although there has been big success in the kinds of gigawatts of wind energy that has been put up, there's been much more disappointment about the extent to which that has resulted in high-quality jobs in Scotland, as opposed to elsewhere. So I think that the importance of getting that kind of planning and specificity is that it would allow people in Scotland to make appropriate plans for scaling up activity, for bidding for contracts and equally for the procurement to take account of local content issues to make sure that the jobs actually arrive. As part of this new energy transition, we are going to see the jobs becoming available in Scotland. It is perfectly possible, in principle, to project the number of jobs and the skill levels that would be associated with the roll-out, for example, of wind energy offshore and onshore. The main issue is certain to on that pipeline of work. Is there anything else that we need to do to make sure that we don't make those mistakes in the past on energy, in particular that the unions are rightly concerned about the fact that renewable companies say, well, we'd like to use Scottish businesses, but then they go and award those contracts to companies abroad? What other barriers do we need to break down apart from, given that certainty of work? I think that the companies that have been contracting have developed some sense of contrition about some of the things that have happened so far. I have started to modify procurement practices that take account of more of local content on making sure that there are community benefits from the kind of work that they do. It is also very important not just to look at the demand for projects, but to look at the supply of the skills as well. To match that, it is also important that there is a lot of attention to the skills agenda so that Scottish companies are in a good place to bid for those contracts when they come through. It is a plug in the socket. We need to make sure that we have the skills to succeed in those competitions, and the competitions themselves need to be more sensitive to the need for local content and the impact on local communities. It is interesting that the skills have obviously won, but are there any other barriers that supply chain businesses are facing at the moment in order to make sure that they can access this huge potential of work? Obviously, they would make sure that they have the workforce in place. Is there any other barriers that need to be brought down around the supply chain to make sure that they can fulfil those? I am interested to mention local content. Obviously, Scotland is probably the best example of opportunities that we have. The focus was on the companies effectively coming up with development plans around supply chain jobs. I was interested in your point earlier about conditionality around local content. Is that something that we should be driving a lot more, or should we just be continuing to leave it to the companies to decide how much local content they want? That appears to be the approach to Scotland. I will pass it over to Elliot in a second. On the conditionality elements, there are some issues about compliance with world trade organisation rules around those issues. Obviously, when we were part of the European Union, there were also conditions around that as well. I think that you need to be quite careful about how far you go to avoid breaching state aid rules, which still apply at the WTO level, as well as at the European Union level. Does Elliot have anything that he could add to that? I think that just one phrase that has resonated within the commission's deliberations on these topics came from Rachel McEwen from the SSE, who likes to talk about Scotland over the neck over the coming decades as a workshop. In terms of the broad planning, her challenge is then to think about who is doing what and where. There is the locational element to that as well, to ensure that there is an appropriate regional distribution in terms of the new areas of the economy that are emerging in new industries, to ensure that there is no over-concentration in the familiar areas. The remote and rural communities in particular are benefiting from this in the long term? As somebody who represents a very rural area in the south of Scotland, I will agree entirely with what Rachel McEwen has said. How do we deliver that? We have got this conflict of rules that may suggest that we cannot put huge conditionality on that. How do we do that? Is it just about making sure that our supply chains are fit for purpose and we are investing in the ports, we are investing in the companies? Is that the only route? Ultimately, the driver for renewable companies will be price. That will be the main driver. We have a desire to see electricity produced as cheaply as possible. We can have a conflict there and produce it cheaply, but then try to use a local supply chain that is more expensive. How do we make sure that we get what Rachel McEwen is asking for and what policy interventions do we fundamentally need? I appreciate that. That is a very detailed question, probably a commission in itself. Maybe I can try to address that one. It is really interesting that SSE is a company. As far as I know, it is almost the only company globally to have a just transition plan and strategy by itself. Obviously, that drives the company to be more sensitive to the issues about local content distribution of benefits than one that does not have such a strategy. I think that there is a role for government. You cannot make companies do things like that, but perhaps you could introduce legislation to require just transition to be formalised in company plans. However, there are ways of encouraging, nudging and shaming companies into paying more attention to just transition principles when they are implementing their strategies. I think that SSE is very interesting. It was parading their just transition planning all around COP 27 in Egypt last week. It has got attention globally for doing it, and that is the kind of pressure. If you can build momentum around that trend, where private companies are engaged with it, that would be a good platform for success. I noticed in your July report under the list of strategic priorities that one of the items was tackling fuel poverty and that there was an action required for energy efficiency to be urgently needed. I was wondering if you could say what the current bottlenecks are that are holding back progress on energy efficiency improvements. Is it shortage of labour, shortage of materials or finance? I will turn to Elliot in a second on that. This is an area that ought to be so easy, because there is a kind of triple win there. You can reduce emissions, reduce fuel poverty and create quite highly skilled jobs by making progress in that area, but the challenges are there in the bottlenecks. The first one is that the level of retrofit that you need to aim for net zero is much more ambitious than just putting a few extra centimetres of insulation into the attic. It is much more ambitious than that. It needs greater skills in the building and construction sector to be able to do that. Obviously, the finance issue is an interesting one as well. We have had successes in the social housing sector, which we saw on the First Justice Transition Commission. However, it is that challenge. We need to get owner occupiers to be ready to put up some of their own money through the right kind of incentives. Perhaps in the private rented sector, there might be a possibility for more regulatory interventions when tenancies turn over. We need a big kind of push on this to make it happen. I have been in this business so long. I have watched ministers come in looking at energy efficiency and looking at saying, oh, God, this is so obvious. Why has nobody thought of this before? They are full of confidence about how to do it. Two years later, they retire defeated because of the social institutional challenges in the sector. However, it is such an obvious one to fix. We need to address it really urgently, otherwise we will not get to net zero in a country like Scotland. We had a session when we were building professionals in Blantyre at best. The message that was coming through there was that it should be fabric first, concentrate on the energy efficiency aspect of buildings, and then you can make a choice of which kind of heating system you want to do, whether it is district heating, in dense urban areas or perhaps heat pumps in other places, but get the efficiency sorted because it is the key to unlocking everything. Iliot? Yeah, thanks, Jim. If I can just add a couple of things to that. I think that particularly reflections off the back of our most recent visit to the island of Lewis where we heard not only from local organisations that are engaged in energy efficiency measures, but also we held a town hall in Stornoway, a town hall event where we heard from local citizens. One of the main themes of that event was a growing frustration at the sense that local people had, that they were sitting with an enormous amount of power being generated in their local area, and then they were looking at rates of fuel poverty on Lewis climbing towards estimates around 80 per cent plus. Clearly, there is a disjuncture there between how power is being generated and how the local community is able to benefit from that in a sustainable way. The other key issue that was highlighted was really around skills and access to skills in remote and rural areas. People were telling us about experiences of trying to retrofit homes, but essentially being right at the bottom of the list of providers who were operating within the central belt and for whom the costs of going to a remote island community like Lewis were obviously prohibitive relative to what they could do closer to home. I think that there are a number of issues there just to highlight on that. Jim, do you want to come back? No, no, it's okay. We have touched this morning a couple of times about finance, and you quite rightly pointed out that owner-occupiers should contribute something. In my constituency in Westerhales, there are 180 blocks being retrofitted with external cladding as part of an improvement to the area, but home owners, many of whom are retired, are being asked between £40,000 and £60,000, which is a substantial element to the value of their property. The only option that they are being given is to sell their property back to the council. I was interested in your June minutes, which said that there was a discussion on who pays for retrofit work, particularly those that are ineligible for warm-work support at present duty benefit criteria, and it was suggested that the Government should look at other countries for solutions, such as Germany and Italy, who both operate effective incentive schemes. I was wondering if you could expand on that minute that you had in June. I think that the reference to Germany was to the KFW bank, which provides funding. Basically, Germany has spent roughly the same amount of money on energy efficiency as the UK has in aggregate, but it has strategised it very differently. It has focused on doing very deep retrofits on a smaller number of buildings, rather than doing modest retrofits, such as attic insulation and so on a large number of buildings, which has been the Scottish in the UK pattern so far. As I recall—sorry, it's a while since I looked at that—KFW was providing funds, zero-interest loans on up to about €60,000 or €70,000, if I recall, on deep retrofits on buildings that were available to people. They were taking rather a different approach with that. KFW is probably in the same bracket as the SNIB, the Scottish National Investment Bank, in that it gets its funds from social security payments. It is not entirely on the private market. Those are the kind of examples that we need to look to. The other thing on the owner-occupy is to look at the points of intervention when you make a difference. When you buy or sell a house, is there something that can be put in there? Can you get discounted mortgages if there are more energy-efficient measures put in? I think that looking at the intervention points and looking at the clever ways of setting the incentives for people has got to be there. I can sympathise as I am approaching that age of getting into retirement and facing a big retrofit cost. How do you manage it? That is the very reason why we need to be sensitive about who pays and who will gain the benefits, etc., which is part of one of our main themes for the just transition. Thank you, convener. I would like to ask a couple of related questions. We are all aware that Scotland has an ageing population, and the latest projections seem to indicate that the working age population will shrink over the medium to long term. What additional challenges does that bring to achieving the kind of upskilling and reskilling that we need to do with the workforce? Are they ready to take the new jobs and new markets that will support the transition? How is this going to work? I will be honest. That is not an issue. We have not discussed ageing population issues within the commission, although it would be part of our social infrastructure theme. Quite clearly, it may be that people will work beyond current retirement ages and change the balance of people who are in retirement or part of the working population. I am past the state retirement age and I am not showing any signs of slowing up at the moment, but I would not give myself an example on that. It is a good thing that we ought to discuss, because we have not covered it specifically in the commission discussions. I do not know, Ellie, if anything has come up in some of the working groups and some thinking around there. I think that it would just be to highlight that in terms of how the just transition is to be understood and worked towards in the Scottish context, this commission has taken a very strong steer that that social infrastructure piece, which would include care and health, and the kind of things on which we all rely, perhaps particularly as we get older. However, that has to be part of the picture, not a marginal concern. In that sense, the work of the commission is more the kind of horizon scanning agenda-setting advisory piece that Jim was talking about earlier. It does not, as yet, align with the Scottish Government's just transition plans. As far as we are aware, there is not, for example, a just transition plan for health, for example. However, it has been highlighted by the commission that part of what a new economy looks like is really valuing the low-emission sectors that sustain the economy and help the economy to reproduce and function well. I think that perhaps it would be unwise to just assume that older workers are going to come back to the workforce to make up the shortage. I realise that the cost of living crisis is forcing many to continue beyond their retirement age, but that may not prevail into the future. It is not something that you can plan. However, again, I would come back to that. All the projections say that we have a shrinking working-age population. That is going to have a direct impact on the jobs and so on around the transition. How is that going to work? How is the workforce going to be managed? On the first just transition commission, one of the first things that we did was to commission a piece of work on what Scotland might look like in 2030 in terms of overall economic and social structures. I have to say that we could not make much use of the report because it was a business-as-usial projection, and 2045 and net zero is just not business-as-usial. I have to confess that we have not thought through those issues, but it is a point that we need to put just transition in that wider context of where Scottish economy and society is going to go over that same period. The net zero is not the only thing that is happening. We need to take account of the other factors. I am afraid that we do not have answers at this moment, but, as with some of the other questions, you are setting an agenda for us, which I think is rather useful. Perhaps I can just ask you another question, which is somewhat related to what I was talking about. Do we have a sense of understanding of the skills that will be in demand, and do we have enough confidence that a pipeline will exist to deliver those in time for investment in the coming years? I will turn to Elliot again on that. We cannot develop very good ideas of what skills are going to be needed. People are doing skills mapping associated with net zero. The bigger challenge is perhaps getting the plans and the pipeline in place to make sure that those skills can be met. It is a message that we are getting about shortages of skills, in fact, in some of the critical areas. That is absolutely something that needs to be worked on. Elliot, do you have anything to add to that? Just to underline that, particularly from the second commission, one of the clearest messages that the commission has sent to the Government is on the critical question of workforce planning, and the age profile of the workforce and the skills that are required, where and when. Those are very much the terms in which the commission is thinking that we need to have a lot more detail and a lot more clarity from Government. At this point, would it be correct to say that overall workplace planning across the country has not really taken place yet? I would say that it is work in progress. People have acknowledged the need to do it, and we are pressing Government on it, but I think that there is still work to be done on it. It is certainly an area that could threaten the effective delivery of the transition if we do not have the right people with the right skills and the right numbers. We can only agree with you on that. Can I just ask your appreciation that James Wothers is currently undertaking a skills inquiry? I think that he is due to produce a report in April. Has he managed to have time to engage with the Just Transition Commission yet? Elliot, do you have any information on that? No, we have not had a connection there just yet, but I suspect that that is something that we will be exploring. Just one other question before I move to Jamie. We had a very broad discussion this morning, and it was the commission's recommendation that the minister was appointed. This is not a reflection on the minister personally, but do you think that the ministerial role has enough weight to have influence across Government, given that this is a very cross-cutting area? I think that it is too early to tell. This is a real experiment in governance. As we have described the Just Transition Commission today, it has a very wide scope, and so the minister has to delve in all sorts of different areas. I think that it is important that the Just Transition Commission itself does not only engage with the Just Transition portfolio, but it engages with other parts, such as the economy and fair work part of it. Environment and land reform is another area in which I have engaged with the cabinet secretary on that topic. We need to go in there. The combination of a critical friend in the Just Transition Commission and having a minister in there is potentially very powerful, but we will need to come back in two or three years' time to check whether that is a genuine experiment in governance for Just Transition. I do not know any other country in the world that has a Just Transition Minister, for example. I was asking a few countries when there was anews in Egypt last week. I think that we wait and see. It is worthwhile trying. We were very keen to see the Just Transition elevated within and given a very specific spotlight within the governance system. I think that we will find out in two or three years whether that is work or not. Jamie Halcro John, sorry, continue. I am just going to say that that is not something that I should turn to Elliot on as one of the secretariat. We do not want to compromise them in any way. Jamie Halcro Johnston, to be followed by Fiona Heslop. Thank you very much and good morning to you both. I just wanted to ask just before I go on to the main points. We have talked about fuel poverty and the issues around our own occupiers and social housing. I represent the highlands and islands, which include, as you mentioned, Lewis, but also Orkney and Shetland, where there are high levels of fuel poverty and frustration, as you mentioned, about a huge amount of renewable generation in those areas. One of the issues that has come up in my time as an MSP has been sometimes a lack of clarity in how particularly only our occupiers can get support, how they can access their lots of different ways and lots of different pots as issues related to income and health issues and age of house, all sorts of different things. In that area, particularly fuel poverty, but perhaps others as well, how important is it that clarity, a streamlined process, easy access to the right information, good signposting, how important will that be to meeting those targets? This is my personal view. I do not think that we talked about it when we were actually over and stored in a way specifically, but the question of clarity for me is absolutely critical. Complex administrative processes and bureaucracies simply discourage people from implying. We are well aware that people end up not taking benefits that they are entitled to if the obstacles and administrative hurdles are just too lie. I can only say that it is very important. If you simplify procedures, you have to accept that there may be a little more rough justice in terms of the decisions that are made, but that is a choice that we need to make. Maybe a bit more rough justice would be acceptable if we can actually make greater progress and get more people engaged. Thank you for that. Another area that we have heard concerns about has been the involvement of small, medium-sized enterprise SMEs, particularly how we engage with small businesses. I wonder if you could perhaps talk more about the concerns that you might have or how important you see that. I am going to see if Elliot can deal with us when it is not one of the topics that I have done a deep dive into on the commission earlier. Elliot, do you have any ideas on that? Can you tell us a bit more about what you have in mind just on that? Are you talking in terms of one way that justice transition is playing out is through different organisations at different levels developing their own justice transition plans? Is that the kind of thing that you are getting at? I suppose that going back in the history of areas around energy efficiency and other areas, it has tended to be a focus on larger organisations that can deliver Scotland-wide, whether that is delivering some of the projects or the initiatives. Encouraging small businesses to play their role in reducing energy use and the like is going to be key to meeting some of those wider targets. I suppose that that is how you encourage small businesses to be involved in that, how they play a role and how they can be engaged with on that. Rather than, as Jim is suggesting, it is not something that the commission has looked at in a huge amount of detail just yet, but it is something that we will consider down the road. The same question of scale was a really interesting discussion on Lewis about the relationship between community wind and much larger corporate wind generation. There is definitely a question across the justice transition question in Scotland. There is an interesting balance here to be had between smaller operations and larger ones. I have just recalled a conversation that we had when we were on Lewis around this particular issue on energy efficiency, which related to the requirement in Scottish Government procurement to use the past 2060 standard for suppliers of energy efficiency services. We heard a lot of grief that that was very difficult and was not suited for smaller to medium-sized enterprises to deal with and tilted towards taking larger suppliers who could put in place more elaborate procedures. It was quite clear from looking at the British Standards Institution documentation that that was very much the intention. They did want larger, potentially more sophisticated operators involved in the process. We identified that as an issue. Perhaps it is the possibility for a slightly more streamlined approach to the application of those standards in procurement processes so that smaller to medium-sized enterprises that would tend to dominate in places such as Lewis would not be so disadvantaged by the more bureaucratic interventions. It is a point that we took home, and it is likely to appear in some of the reports that we come out with next year as an issue. We are all agreed on what we call to understand the need for just transition around energy and the moves and the impact that is going to have particularly on some key areas of the energy sector or how that might shift in Scotland. However, there are other sectors that we have mentioned as well today. Housing has been one agriculture. I am a partner in a farming business and I can see the changes that are already being made. Within housing, we need to build more houses and we need to provide more homes for people. Within agriculture, we have spent many years incorporating environmental issues within farming practices, but we now see food prices increasing and we see pressure in terms of supply. How will some of those conflicting interests perhaps impact on the work and what can be delivered in terms of a just transition and perhaps on the work and recommendations that you might make? I will have a go at it first and maybe pass to Elliot. On the housing issues on new build, it is absolutely essential that, when new build takes place, it is built to the absolutely highest standards. I was involved in the IPCC report that came out this year on reducing emissions, which is very clear that, in all parts of the world, it is possible to build almost net zero buildings. We should be aspiring to that. I know Lord Diebin, who is chair of the Committee on Climate Change. His words, rather than mine, is quite scathing about the major house builders and the kind of housing that we are putting up at the moment that is locking in carbon dioxide emissions for decades into the future. It is really important for new build that we get a grip on the standards there. Agriculture and land use, I think—there are an awful lot of townies, if I can put it that way, on the Just Transition Commission. We hold our hands up there. I think that we are just humbled by the complexity of some of the issues around agriculture and land use. When a tendency comes to an end, who do the trees belong to? Who do the cattle belong to? Those kinds of issues are just why agriculture and land use is also very much tied up to the land reform issue, that we really need to get our heads around. We have experts on agriculture and land use on the commission who will help us to think our way through those problems. I do not know, Elliot, if you have anything to add to that on housing and land. I am just very quickly on housing. I really appreciated the comments from members earlier about how accessible our July report was in terms of plain English. There was some rather unparliamentary language on the standards for new house building that had to be judiciously edited. I think that, Jamie, you might remember, which I will not quote in this session. Just to say on agriculture and land use, the challenge for the commission is to take account of the different scales at which different businesses and different operations are working. In Lewis, it was great to hear from local crofters. They were pushing this notion of peripherality as an important principle when thinking about the development of plans and plans for just transition. It is not necessary that they make plans. Obviously, none of those plans can just invent some kind of perfect new system, but it is about identifying where the key risks are and making sure that the burden of those changes is not falling on those least able to shoulder burdens and where there might be particular vulnerabilities that can be addressed and recognised and mitigated. I think that the issue around who inherits the trees is probably less of a concern in places like Portney and Shetland where I am from. I am sure that the local sectors would welcome a visit, because those are important issues. I am also interested in FOI to find out what this unparliamentary language is. We get a good honest appraisal of your thoughts, but thank you. I will leave it there for now. I should point out that I am the only MSP that sits on both the Economy and Fair Work Committee and the Net Zero Energy and Transport Committee. Professor Skew, you have given evidence to that committee as well, so I am interested in how we dial up the just transition focus in this committee and respect what the other committee might be looking at. For example, the land use, land reform and transport areas. How do we read across that? I wanted to ask specifically about the just transition fund that exists for the North East and Murray, which in and of itself is obviously focusing and making a decision on a place-based approach to just transition. Did your commission advise the Government in advance of the announcement of the initial £50 million funding for the 24 projects in the first tranche? Just on the first point about the intersection with the committee in particular, for me it is on the classic just transition issues of labour markets, skills and training, and that would be where the focus would be. There is obviously some intersection with other committees, because the training needs, skills needs and so on will be very specific to individual sectors, and there is a crossover there. For me it is classic just transition skills, training and labour markets, where we have the issues here. On the just transition fund, I only yesterday took a look at the projects that have been funded and I personally had had no involvement with the way that those individual projects were selected. Obviously, it is a significant amount of money, about £50 million altogether, with quite a big variation in the size of the awards. I think that they vary from about £100,000 to £7 million, or £8 million, maybe, is the kind of the top end of the range. However, we have had no involvement in that so far. I think that one of the things—this is me talking personally off the top of my head—we cannot really get involved in discussing the merits of individual projects, but I think that we would have an interest in the criteria that are used to select which projects go forward, and perhaps also some of the governance issues around how the selection process actually works. I do not know earlier if you may have had something closer to the Scottish Government on this than I am. I think that just to underscore that the remit of this commission is really focused on the development of just transition plans. There are not specific aspects of the remit that has the commission to provide oversight of the just transition fund. The commission as a whole is interested in following this with interest, and we would be happy to provide scrutiny and advice if that is what the Scottish Government would like from us. On the basis that the projects that are there are all very good and worthy in and of themselves. Some of them are more probably focused on delivery of net zero, as opposed to necessarily just transition. I think that that is going to be an obvious fault line between when you are trying to generate that transition as opposed to focusing on the just aspect of it in terms of the fairness and in terms of those principles that you established. The question then is, if there is to be funding for just transition, should it be mainstreamed in the areas that you have heard of already, from housing, from energy, from transport or indeed from private companies, or is there merit in having stand-alone just transition plans supported by funds? If those funds have a criteria, is that something that the commission would advise on? If you are advising on the just transition plans setrally, are you also advising about how any funding and the criteria for funding, or is that still work in progress? Just to say that, I can probably open up more as chair of the commission rather than Elliot, who is on the secretary. However, we are a commission that is independent of the Scottish Government, and if we chose to provide proactive advice on a topic like that, I do not see any obstacle to us doing that. Given the fact that the commission has not met, obviously, since the funding was announced, I am perfectly sure that it will come up at the next commission meeting that we have. I would think that it is relevant, and it is within the broad remit of the commission to consider how funding is being applied and the degree to which it is the justice bit or the transition bit that is being addressed in the funding streams. What you raised about the issue about whether, as it were, a labelled just transition fund, as opposed to merging just transition principles into all other sources of funding, is one that we need to kick around. It is genuinely one that the commission has not considered yet. It is new information for us on what the portfolio of projects looks like. I think that that is something that the committee would be interested in. We have to determine what we want to do as a committee, and you might want to advise us as to what we could most usefully do, because there is no point in us repeating the work that you are doing, but we need to work in synergy somehow. I suppose that the challenge then is just transition if we are doing things that are quite innovative globally in how we are approaching it. We have to make decisions that are difficult choices. The issue then is, would we need to, in Scotland, make big and bold decisions with what we do on just transition, or will piecemeal segmented activity that seed corn for other sources of funding be a way forward? That is a genuine dilemma. Is that something that the commission has discussed? No, we have not discussed it. On the first just transition commission, it was surprising how little we talked about funding and how much more we talked about doing things smarter or better. That is in very sharp contrast for things such as just transition within the EU green deal, where the financial flows have just completely dominated the discussion. We have a finance working group, which Nick Robbins is leading for us. Those are the kind of issues that we need to pick up. The focus of that group so far has been much more on the role of bodies such as the Scottish National Investment Bank and how you leverage private funding. The just transition funding is strength grant-based, as far as I can see. That is a different approach to finance. I think that we need to get our heads round. I will certainly be raising it with the commission at our next meeting. There is an issue about skills, which the committee can focus on, but some of the skills that need to be developed now may not then be delivered for projects until five years time. However, if we do not start investing in the supply chain and developing those skills now, we will not necessarily be able to deliver when the scale-up of the renewables will happen at pace and scale. The issue is how we support supply chain skills engineering companies, for example, to make those investments and decisions now when they might not necessarily reap the reward for that for five years time. That is a genuine transition challenge about how we support them to do that, and that may mean state subsidy. Is that something that your commission would look at in those terms, or is it something potentially that we can look at? We think that it is absolutely within our remit. Obviously, we have a slightly different function because you are scrutinising on behalf of the Scottish Parliament and we have been given an independent role. We have been given the concept of an independent role, but this is one that we need to follow up on. Why have we absolutely emphasised the need for sector plans and roadmaps to take us forward? We cannot wait until needs manifest themselves before investing in supply chains. We need to be anticipatory, given the short length of time until 2045, and that means scaling up in advance in terms of supply chains. We have not addressed those issues in a commission meeting that I can recall, but it is absolutely one on the agenda. I think that there are many issues that have been helpful for us to hear the concerns of MSPs about particular topics that might be relevant. Elliot and I will certainly be taking that back and bringing those issues back to the commission when we are next made. Elliot, is there anything else that you want to say on that? I hope that there will be a productive relationship between the commission and the committee. There is a significant overlap in terms of the priorities on just transition that have emerged from the conversation. There could be productive opportunities for further extraneous collaboration. Thank you very much. I think that that is probably an appropriate time to hand back to our committee convener. I am going to allow Maggie Chapman in with a supplementary. Thank you very much. Just one brief final question. You were speaking quite a lot about social infrastructure and I am also mindful of the task around meaningful engagement with those who are going to be most likely affected by the just transition to have the opportunity to shape that. If there is something in that space that you have not done or are not planning to do, that might be a role for the committee or vice versa. I think that there is something around that engagement, particularly with not the usual suspects, if we can say those who will directly be affected but do not have an industry voice or do not have that kind of input into the structures that we have. The not the usual suspects issue is something that we have talked about quite explicitly, which is why we go into things like town hall meetings when we go out on our various site visits. I should say that the question of social infrastructure, what I have mentioned, is something that has been the subject of some debate within the commission. The question about whether that is social infrastructure is a more broader and more conceptual approach or whether it is more specifically about the social care sector, which, for other reasons, we will become more important in the Scottish economy. I think that this is something that we need to work about. We need to clarify our thinking on that just a little. I know that we have received queries from the Scottish Government about what we precisely mean by social infrastructure. We need to get our thinking to be a little more rigorous on that topic. One area in which we emphasise that it could be quite important is if, for example, we look at climate change adaptation, then the question of social infrastructure with the physical impacts of climate change could become much more important. Elliot, is there anything that you can add on that? Just on the engagement question, we have our Equalities, Participation and Engagement working group. I think that that question of making sure that it is not the usual suspects only that are inputting both in terms of the development of the plans but also in terms of the monitoring and evaluation piece. That was a really specific piece of advice to Government from the commission in the July report on how they take forward their work on M&E. It was to go beyond a specific piece of focus work to make sure that those most likely to be on the sharp end of the transition as we go forward are part of that decision-making process. I think that that working group will be looking to take forward that work and to find new ways of engaging in that way. Thank you very much. I would like to thank Professor Ski and Elliot Ross very much for giving us evidence this morning. That has been very helpful and I look forward to continuing a working relationship with the commission. I now move into private session.


The purpose of this McCree is to test the battalion and make sure that we're mission capable, specifically in the combat environment. 90SB is taking part of this McCree. We have some augments and the additional main effort that is supporting us is the Neff and the Eagle Expeditionary Force, NMCB4, so we have the CBs from them, more so the utility section here with us here today that are helping us out. Right now, we're working on integrating with the Navy more, so specifically more the CBs. We have a bit here at 90SB, we're very engineer focused, so we have the combat engineers, we have the utilities, we have heavy equipment, we want to work together so this way in the future when we have missions that come down specifically here in the Pacific, we're able to work together and see exactly what our capabilities are, so this way when the Neff and the Meff push forward in the future, whatever the mission is, we can work together and combine our forces.