The Scottish Government

Minister for Children and Early Years Adam Ingram

Girvan Horizons Conference

Ayrshire

_________________

I am very pleased to be here today representing Scottish Government at this conference. I know you will be hearing later from a wide range of speakers about European, National and Local perspectives on rural regeneration and what it has done and can do for Scotland. But simply putting in resources will not be enough to achieve sustainable economic growth. Communities themselves must feel that they and their actions will have a positive impact on their futures.

Mainstreaming Rural Policy

This is true throughout Scotland but perhaps even more so in our rural areas. All Scottish Government Ministers aim to address rural issues in their policies. . In South Ayrshire we have a large rural area - 422 square miles - from Troon and Symington in the north to Ballantrae and Loch Ryan in the south. Around 95 per cent of our country is classified as being rural and around one million Scots live there.

Rural Schools

In the Education portfolio, for example, we are very aware that schools are at the heart of rural communities. The principle of cohesion - wealth and opportunity shared across Scotland - sits at the heart of the government's approach and we have no doubt that local schools are an important part of ensuring a vibrant local community and therefore economy in villages across rural Scotland.

I was pleased to see the decision this week by the Council to retain the primary schools at Pinwherry and Straiton, and build a new school at Colmonell.

Maintaining schools in some small, rural communities can make a real difference in assisting regeneration and growth. We launched a consultation on safeguarding rural schools on May 1. Our proposals seek to ensure that authorities look at all the options and impact on communities before proposing a rural school closure. We propose that authorities demonstrate they have considered alternatives to closure, the impact on the community including use of the buildings and the impact on the environment of new travel requirements.

We are also proposing tightening the Regulations for all school closures, rural and urban. We want authorities to carry out robust, transparent consultations on school closure proposals. This should mean that no school is closed by an authority without full consultation and discussion.

The consultation will run through to September 19, allowing plenty of opportunity for everyone to register their views. We intend to introduce a Bill at the earliest suitable legislative opportunity, after we have considered the responses to the consultation.

But as I said with putting in resources, so with simply ensuring local schools are available. These measures in isolation will not ensure we have vibrant thriving rural communities.

As our recent history has taught us, where there are few economic opportunities available, young bright and mobile Scots will vote with their feet - and, leave Scotland to seek better opportunities beyond our borders. Today, there are successful Scots everywhere, and Scots leading the way in every field imaginable.

We believe we must reverse that trend once and for all, and create the opportunities to retain our brightest and best. If we attract and hold on to our most talented people, we will in turn improve our comparative advantage and put Scotland firmly on the map as a country of enterprise and endeavour.

Achieving that has always, for us, been a question of leadership. Of government finally being honest about where we are, and being ambitious about where we can go.

Government Economic Strategy

Last November, we launched our Government Economic Strategy. This was of great importance to me as I have both a Ministerial and professional interest in the South of Scotland economic strategy with my local business background and working for ten years as an economic development consultant. I know, for example that South Ayrshire has a core of traditional industries based on farming, forestry and fishing supported by strong manufacturing, service and tourism sectors. GVA here in 2004 per head was about 88 per cent of the Scottish average. That is one of the highest outside of Edinburgh, Aberdeen, Glasgow . But we need to do better.

The strategy set out how we will achieve success in Scotland through an entirely fresh approach. Yet, the plain - and painful - truth is that we haven't seen enough of this kind of enterprise and ambition in recent years.

Scotland's economy has suffered from three decades of mediocrity. Over the last thirty years, Scotland's annual average GDP growth has averaged 1.8 per cent - significantly below the UK average of 2.3 per cent.

Scotland's growth has lagged that of the UK overall in nine out of the past ten years - and, while Ireland and other small, prosperous countries around us have flourished, Scotland has been left behind. The figures tell their own story. Scotland's productivity, in terms of GDP per hour worked, is 26 per cent lower than that of Ireland's.

And, it is a staggering 67 per cent lower than Norway's.

It is also a fact that Norway, Iceland and Ireland are respectively the first, second and fourth most prosperous countries in the world according to the UN Human Development Index. As we know, all these countries declared their independence in the 20th century and have clearly benefited from not being part of a larger political union.

Because Scotland has not enjoyed the success of Norway, Iceland and Ireland, our economy has lost out on an opportunity cost of many billions of pounds.

A low growth economy concerns every one of us, because it will dramatically affect the way we live in future. It affects our job opportunities, our incomes, and the profile of our population.

Rural Development - European Structural Funds

A low growth economy is certainly not what we hope to see in rural Scotland. There are programmes, as you know, designed to help tackle rural issues.

The European Structural Funds complement other sources of EU funding for rural areas to maximise the potential for a coordinated, comprehensive approach to rural development. The Operational Programme for the Lowlands and Uplands Scotland (LUPS) 2007-2013 programme makes rural areas a priority for the European Regional Development Fund (ERDF).

Reflecting this, priority 4 of the Programme seeks to maximise the contribution of rural areas to achieving Lisbon goals with a view to developing sustainable economic growth

The Programme aims to complement both national strategies, such as the Scottish Rural Development Programme as well as major local strategies. The key themes supported by the priority are:

• to assist the strengthening and renewal of rural industries and
• to support the development of key shared services in the region to underpin economic and community sustainability

The first round of awards under Priority 4 was made in April 2008. It resulted in ERDF funding being offered for four projects. These were

• Regional Biomass Advice Network
• Unlocking Economic Potential in Perthshire/Angus
• Green Tourism Consumer Promotion and
• Homecoming Scotland 2009

Between them, these four projects received a total of £3,123,762 in ERDF assistance.

In addition to mainstream awards such as these, Priority four has a special aim of supporting the competitiveness strategy that has been developed by the South of Scotland Alliance. Mechanisms are currently being developed to implement this aim, and we expect that the first awards in the South of Scotland will be made later this year.

Rural Development - Scotland Rural Development Programme

The Scotland Rural Development Programme which extends through to 2013 will offer opportunities to a wide range of people to contribute to the development and regeneration of rural Scotland - not just from the traditional industries of agriculture and forestry, but other land managers and people in rural communities too.

The Programme is an integrated and holistic approach to rural development in Scotland. The Programme represents not only significant funding but also a significant shift in how we engage with rural Scotland. It is no longer about the centralisation of specific grants but is rather about agreeing with communities and other stakeholders what public benefits they can provide for the people of Scotland.

The five key outcomes that we will work with applicants to deliver are business viability, enhanced biodiversity and landscape, improved water quality, tackling climate change, and enhanced development of rural communities.

As a whole, it will deliver around £1.6 billion of European and domestic money to support the many facets of rural development. . Indeed, around £1 Billion of the funding for the Programme is coming from domestic funding - this demonstrates clearly the level of commitment this Government has to rural Scotland.

LEADER

The LEADER Axis of the Rural Development Regulation will be one of the main delivery mechanisms for the Scotland Rural Development Programme. This is radically different from other measures in the SRDP. As you know, LEADER is a bottom-up form of engagement driven by rural communities, for the wide benefit of those communities and decided by the communities themselves. LEADER was previously a stand alone European programme - one of four Community Initiatives - but has now been mainstreamed and integrated into the SRDP. I very much hope that full advantage is taken by communities of this opportunity.

I was pleased to learn that an expression of interest in forming an Ayrshire Local Action Group has been submitted for the 2nd round of LEADER. We expect to award funding in the summer months.

I was particularly pleased to learn that this note of interest is as a result of the three councils coming together. Relationships built on co-operation and trust looking towards public benefits are exactly what this Government is building too in its Concordat with CoSLA and the Single Outcome Agreements with individual local authorities.

The local strategies submitted under the Programme have been targeted towards some of the positive outcomes we all want to see from the SRDP and have built on the partnerships which have been established across Scotland. These partnerships help to harness the expertise and resources which the private sector and the voluntary sectors can bring. I know that some other Member States have been particularly successful in engaging the business community in developing and delivering programmes and projects to further the socio-economic development of local areas. We want Scotland to aspire to be a leader in that regard too.

Improved Customer Services

I did say that simply giving resources will not achieve our aim. That is why this Government has backed up the new Programme with improving our delivery services and helping communities articulate their aspirations for their areas.

The Programme will be delivered in a more integrated way, with Scottish Government staff working closely with staff in SNH, the Forestry Commission and others to provide a one-stop shop approach for those wishing to apply for funding.

Our plans for more streamlined responsive and accessible business support services are designed to support and stimulate business creation, competitiveness, innovation and growth and regeneration across Scotland.

Reform of Scottish Enterprise

We have recognised that businesses need better help. We have reformed Scottish Enterprise and Highlands and Islands Enterprise. They will now be able to make a greater and more attributable impact on the Scottish economy. They will be more responsive to business customer needs and more tightly focussed on supporting transformational projects with national or regional significance. They will be supporting priority industries, encouraging investment and innovation by companies with real growth potential.

As part of the implementation of our reforms, there have also been positive discussions between Scottish Enterprise and COSLA on the transfer of local regeneration activity, and the management of 12 Business Gateway contracts was transferred to local authorities with effect from April 1, 2008.

We are now engaging with COSLA, HIE and local authorities to establish the Business Gateway service in the Highlands and Islands.

Another key element of our reforms has been the Strategic Forum, established to promote strategic and operational alignment between Scottish Enterprise, HIE and VisitScotland. Membership has now been widened to include Skills Development Scotland and the Scottish Funding Council.

Social Enterprise

This Government wants to mobilise the abilities of everyone in Scotland. All of us can take a little time to think about our country, what we can do within our country - how we can build it more successfully to improve the situation of every citizen.

The Scottish Government believes that a well developed third sector can make an important contribution to furthering our purpose of creating a more successful country.

The operation of social enterprises is unique combining business skills with social drive.

I believe that social enterprises have the ability to play an increasingly significant role in Scottish society and in the economy.

The new Scottish Government is committed to five strategic priorities

• wealthier and fairer Scotland
• healthier Scotlan
• safer and stronger Scotland
• smarter Scotland and
• a greener Scotland

The Third Sector can make a real contribution to all of these areas already; we are therefore committed to helping the sector reach its potential in Scotland.

That is why John Swinney announced a £93 million programme for the third sector in the Spending Review announcement in November.

Details on this are currently being worked on, but there will be significant investment in individual enterprises through the £30 million Scottish Social Investment Fund. As well as investing in those organisations that can demonstrate that they can grow in a sustainable manner, we will also ensure that we are creating the right conditions in which the third sector as a whole can thrive.

Whilst we will support organisations across the country, we do recognise that rural social enterprises are a particular feature in Scotland delivering important services in remote communities, with 35% of Scottish social enterprises being rural based.

The Government therefore have an interest in helping to develop social enterprises as businesses so that they can realise their potential as deliverers of key services as well as economic drivers, generating income and providing jobs and regeneration in rural areas.

There are many areas where social enterprises are established providers of services. In these areas the sector is at its best when it is allowed to be responsive and innovative.

The Scottish Government is committed to building a strong third sector in Scotland. We want to make sure that the third sector has a place in the way we move forward with our policy agenda. The First Minister recognized that responsibility for the third sector and social enterprise had to be moved from the periphery to the centre of government and to be an integral part of the way forward.

Helping Communities Help Themselves

As a Government we believe that too much power in Scotland has been drawn up to the national level over the last few years. We are determined to change that and to put power back where it belongs - nearer to the Scottish people.

This starts with making sure that Local Councils are given their right and proper place. They are democratically accountable. They are the tier of Government closest to communities on a day to day basis.

The next step is to make sure local communities have more direct control and influence over the things that affect them. I am therefore delighted that earlier this month we issued a joint strategic statement with COSLA on our shared commitment to empowering communities.

This commitment will be backed up by an action plan that we will develop with COSLA and colleagues in the third sector. It will focus on a number of areas that people across Scotland told us could do with some attention. Areas like the need to publicise existing examples of community empowerment; the need to train staff and communities; and exploring further the practicalities and challenges of community asset ownership.

The Government are facilitating a consultation on a Model Community Council Scheme and Code of Conduct for Community Councillors. We hope that the model scheme will allow for greater consistency in the way community councils work all over Scotland, whilst at the same time allowing local authorities and community councils to reflect local circumstances.

Rural Communities

People who will have the best innovative ideas to make their community sustainable are those living and working in it. I am constantly struck by how much that is truly important and original in our country and in our culture is being done by local rural people. We want rural communities to be able to seize the opportunities available to them and take control of their own development.

That is why we have given funding of around £300,000 this year to the Crofters Commission and to the Scottish Council for Voluntary Organisations to help rural communities draw up local investment plans and access appropriate funding to make the plans and aspirations come true.

A can do strategy for a can do nation

We are right to trust the people of rural Scotland to tell us what needs to be done in their areas to achieve our national aims. We recently received a review of Scotland's rural policy from the Organisation of Economic Co-operation and Development (OECD). Much of the evidence was gathered before we came to power last year and we are addressing many of the issues about empowering rural communities and making sure their voice is listened to when policies are being formed. But one observation by OECD shines out - OECD said:

'The quantity and quality of innovation in Scotland's rural areas is remarkable and should be better exploited.' That is just what we will allow to happen through our reformed structures and and relationships.

However, there is no doubt that we are entering into a challenging period within the global economy.

Our Government Economic Strategy has been developed as a long-term strategy to turn round decades of economic underperformance in Scotland, and increase sustainable economic growth over the long term. Ours is a can do strategy for a can do nation - a nation that can survive, and thrive, in a global economic downturn.

And, it represents a major step toward releasing the potential that our nation - and, in particular, our people - undoubtedly have.

Addressing decades of economic underperformance requires a fresh approach, recognising that business and people, not Governments, drive economic growth. Our greatest asset is Scotland's people - the focus of the Government Economic Strategy.

We are serious about matching, and exceeding, the success of Norway, Iceland and Ireland - and, in ensuring that increased prosperity is shared across our society.

That is why we have convened a Council of Economic Advisers to offer us their thoughts on this Strategy, and their independent advice on how to raise Scotland's sustainable growth rate.

We are grateful too for those from our public, private and third sectors who have offered their own thoughts and expertise on how we might achieve the sustainable economic growth that we all want to see. I know that many of you here will have contributed to the development of our strategy - and we thank you for that.

As you know, our economic Strategy identifies five Strategic Priorities that are internationally recognised to be most critical to sustainable economic growth:

Firstly, we will focus on Learning, Skills and Well-being - on giving every child a strong start in life; on providing education and skills to meet the needs of business; and on ensuring Scots enjoy the physical and mental health to play a part in economic growth.

Secondly, we will focus on providing a supportive business environment - on providing broader support for innovation, and a competitive tax regime to help us attract investment. Across Scotland, our businesses must be given an environment within which they can provide high-value employment - and act as the generators of wealth.

As part of our Strategy, we are already cutting or removing rates bills for around 150,000 small business properties across Scotland. By removing this unfair burden from our businesses, we will boost these and our other local economies and send out the message that Scotland is open for business. We want nothing less than to make Scotland one of the most business-friendly locations in Europe.

Thirdly, we will focus on infrastructure development and place - so that we enhance our public transport connectivity; and align our planning regime to the needs of our economy.

Through our Strategy, we will therefore ensure land-use planning is focused more effectively so that it makes our communities more attractive propositions for investors.

Fourthly, we will focus on effective government - and, on working with our public services to drive up efficiency, provide better and more streamlined services. As you know, we have already signed a historic Concordat with local government, and are providing our public services with the resources and freedom they need to deliver for Scotland. Let me be absolutely clear on this point - we want our public services to be aligned to the needs of business and to play their part in ensuring that our people are healthy, motivated and able to play their part in building our nation's prosperity.

Finally, our Strategy focuses on ensuring that our increased prosperity is shared equitably among everyone in Scotland.

Our strategy is about putting a much greater priority on achieving a more balanced growth across Scotland, to give everyone in Scotland a chance to succeed.

By freezing Council Tax we have already made a commitment to sharing our wealth more equitably and ensure more people in Scotland get a better deal. And, we believe that the local income tax will provide the people of Scotland with an even better deal through time.

Yet, through this Strategy, we will also create a more balanced growth by supporting our renewable energy sector to take advantage of our considerable natural resources and put Scotland at the forefront of green energy production.

Crucially, this is a Strategy for all of Scotland.

It sets the direction for the whole of the public sector, business and the third sector - all of those represented here in this room this evening - to work collaboratively to deliver real improvement in incomes, opportunities and the aspirations of our people.

Previous governments and previous economic strategies were full of good intention - but, they failed to turn our economy around because they didn't recognise the central importance of the public and private sectors working together toward a single, shared Purpose.

To this Government, there can be no alternative.

We will not achieve economic success for Scotland unless the public and private sectors are given a shared purpose.

Our public and private sectors go hand in hand - and how they interface will have a significant bearing on how successful or otherwise this Government Economic Strategy will be in the years to come.

Tough national targets

Of course, success for this Government Economic Strategy will ultimately be about results.

We will not be judged by inputs - but by tangible improvements in the things that matter to Scottish people.

That's why this Strategy is the first of its kind with measurable, time-bound targets - including our target to raise Scotland's growth rate to the UK level by 2011, and our target to match average European population growth over the next 10 years.

These are highly ambitious targets. - particularly, in the global economic environment we are now operating in.

But, we are right to be ambitious. Our history and our instincts tell us that it is right.

In recent years, we have watched as our near neighbours Ireland have set, and met, stretching national targets - and, increased the prosperity of their nation as a result. It is therefore our duty to do the same - to transform Scotland by setting our own sights high.

Working hand in hand with our public sector, our businesses, and the Third sector, this SNP Government will deliver on these targets - and ensure they are monitored every step of the way.

There is an old Chinese curse which says 'May you live in interesting times'. These are indeed interesting, exciting and challenging times for rural Scotland. And I know that rural Scotland will not see this as a curse but will seize this golden opportunity to make our nation thrive and shine on the world stage.