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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 658-iv House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE SCOTTISH AFFAIRS COMMITTEE
THE POTENTIAL BENEFITS FOR SCOTLAND OF THE 2012 OLYMPICS
Tuesday 29 November 2005 MS LINDA McDOWALL, MR BILL MORTON and MS JANE COOK Evidence heard in Public Questions 203-254
USE OF THE TRANSCRIPT
Oral Evidence Taken before the Scottish Affairs Committee on Tuesday 29 November 2005 Members present Mr Mohammad Sarwar, in the Chair Danny Alexander Mr Ian Davidson Mr John MacDougall Mr Jim McGovern Mr Angus MacNeil David Mundell ________________ Memorandum submitted by Scottish Enterprise
Examination of Witnesses
Witnesses: Ms Linda McDowall, Senior Director, Strategic Relationships, Mr Bill Morton, Senior Director, Network Operations and Ms Jane Cook, Senior Manager, Network Operations, Scottish Enterprise, examined. Q203 Chairman: I should like to welcome you to this meeting of the Scottish Affairs Committee on our inquiry into the potential benefits for Scotland of the 2012 Olympics. Please would you introduce yourselves for the record? Mr Morton: Thank you Chairman. I am Bill Morton, Senior Director, Network Operations in Scottish Enterprise. I am joined today by my colleagues Linda McDowall, who is a fellow Senior Director looking after our strategic relationships, and also by Jane Cook, Senior Manager, who is acting as our Project Manager for the Olympics. Q204 Chairman: Would you like to make any opening remarks before we start the detailed questions? Mr Morton: Not specifically; we are quite happy to address any questions that arise from the note that we have submitted for your consideration, but also may we say that we welcome the opportunity of being here today. We realise that it is quite early on in the process in terms of preparing for the Olympic Games, so if there are any issues that you feel in the fullness of time you would like to address in greater detail, we should be more than happy to return to the Committee at that time. Q205 Chairman: In its memorandum to the Committee, the Scottish Executive sets out a number of ways that Scottish businesses can benefit from the 2012 Games. These are, for example: opportunities in construction for the Games facilities and village; provision of services at Games venues such as catering, security, cleaning and maintenance; the supply of equipment such as seating, temporary buildings and lighting; clothing such as Games uniforms and merchandise; the supply of food to Games catering contractors and concession holders. Would you agree with that assessment, and are there any other ways Scottish business could benefit from the Games? Mr Morton: These are certainly examples of where we think there will be business opportunities. We are very happy to work with partner organisations, but particularly through the organising committees, both at the nation and region level; that should identify both our time line and also our range of procurement opportunities. At this stage, we are very open-minded. We would try to tailor our support, for example, in terms of awareness-raising of a whole variety of contracts that Scottish businesses might be able to access through tendering, or we might be able to encourage businesses to develop to address a particular market demand. Q206 Chairman: Would you rank the importance of the individual benefits in the same order as the Executive have listed them? Mr Morton: Yes, I think we should. In Scottish Enterprise our lead role is clearly in economic development, which is why we are specifically interested in the business investment opportunities, in tourism and also in trying to attract the spending power of one of the teams to Scotland. Q207 Chairman: What do you think is the single most important way that Scotland could benefit? Mr Morton: I think that will vary over time. At this stage in the build-up to the Games, we are very much in the pre-event stage. The most important thing that we should be able to exploit to the benefit of Scotland would be this list of procurement opportunities, to know where the contracts are, when they are likely to take place and their nature. Q208 Mr McGovern: Two Scottish companies were successful in winning the contracts to produce the bid document and to supply flags and banners. Some very significant contracts still remain to be awarded, for example to build the actual arenas for the Olympics and the facilities at training camps et cetera. How will Scottish Enterprise support Scottish firms to enable them to win such contracts? Mr Morton: The first thing we would do is to encourage, through various events and profile-raising a fuller awareness of what the opportunities actually are. Behind that, we can actually tailor specific support in our generic business development activity. For example, if one of the businesses perhaps were to get involved in the construction side, were to win contracts and they required support with ensuring they had the right skills available within the workforce, that is something that Scottish Enterprise could address very directly. Q209 Mr MacNeil: Have any Scottish businesses come to you yet to ask for any specific help? Secondly, had the Games gone to Paris, would you still be offering the same help to Scottish businesses to compete for the Olympic contracts? Mr Morton: It is possibly a little early for companies to come to us. We should like to take the initiative and make sure that we go to them and use every device at our disposal to ensure that they are aware. We do have some contact with the companies that your colleague identified earlier as having won some of the business in the early stages. Had the Olympic Games gone to Paris, I think we should still have pursued the opportunities to support business development in Scotland, but because of the proximity to the Games, actually being within the United Kingdom, the opportunity to do so is more readily achieved and also the benefit to Scotland greater. Q210 Mr MacDougall: Looking at the Olympics in terms of the possible development prospects for businesses, do you regard investing in current businesses as more important than trying to create new businesses, or do you think there will be some kind of mix? Have you given any thought to that? Mr Morton: I should imagine it would be both. Scottish Enterprise, with our approach to helping growing businesses, is keen to see a greater number of businesses of scale in Scotland. So if the Olympic Games can be used as a catalyst for accelerating the growth of business which exists in Scotland, we should be very keen to do that. We should be very keen to look at opportunities which relate to specific sectors like tourism or maybe the provision of services from within Scotland which meet the specific demands of the organisers of the Games. We are also very keen to support the development of enterprise, so if businesses could be created and could be accelerated in their development to the economic benefit of Scotland, we should be very keen to be associated there as well. Ms McDowall: Once we know what the procurement opportunities are, then that in itself will help us focus on the businesses which can go for those opportunities, but also where there may be opportunities for new business creation around those procurements. Q211 Mr MacDougall: You will have seen from the statistics which have been provided from the Olympic experience in Sydney the scale of investment there. Is the scale of investment likely to be similar in Britain? Did you see any specific reasons in Sydney that would make the outturn slightly different to the UK as a whole? Mr Morton: From all we can deduce at this time, and it is early days, it looks as though there are quite distinct parallels with the level of investment, both in running the Games and setting up the infrastructure and events for the Games. If anything, there is the possibility, with the passage of time, that the opportunity is bigger with each successive Games, so we should certainly be encouraged to believe that there is a very significant opportunity here for Scotland to play its part and to fulfil the promise that has been given by the Government that these are United Kingdom Games, they are not South East England Games. Q212 Mr Davidson: There are obviously going to be a whole lot of other opportunities in procurement of construction. Do you have an estimate of or a target for how much would come to Scotland? Mr Morton: It is impossible to say at this stage. The procurement, for example, has not been defined as yet and we do not expect that really to start to pick up any momentum until possibly into the spring of next year. We shall certainly be very close to the Organising Committee and its regional --- Q213 Mr Davidson: When do you think you will be in a position to have an estimate or a target? Mr Morton: As soon as the information starts to filter through in terms of what the requirements are to both stage and set up all the various --- Q214 Mr Davidson: Surely if you know roughly the scale of what they are likely to want and you know what happened previously in other Games, you must already have some sort of notional idea of how much, in terms of procurement or construction, Scotland ought to be targeting? Presumably, we are not going to get everything and presumably we are not going to get nothing. In between, I am not quite sure where you are aiming. Is it 10 per cent, 20 per cent, five per cent? What sort of ball-park figure are you considering? Mr Morton: Quite honestly, we could not quantify that at this stage. It would wrong of me to say that I could take a wet-finger guess and suggest that a proportion of what I believe might happen could come to Scotland. I should answer that question along the lines that we should use every device at our disposal to make sure that the largest volume of business could be won for Scotland as it becomes available through the procurement lists. Q215 Chairman: At what stage do you think you will be able to set the targets in future? Ms McDowall: I think the Nations and Regions Group are due to meet in January. We hope to be privy to what the procurement opportunities are around March of next year and then through proactive intervention to try to maximise the most of that for the benefit of Scottish companies. Mr Morton: It would certainly be one of the issues that we should be very happy to come back to discuss with the Committee. I understand your colleague's desire to see a specific target and I personally, and I think our organisation, would support the setting of that target because it would help to mobilise and to motivate within Scotland. However, it is very difficult to speculate on what that target might be at this point. Q216 Mr McGovern: I think there is a general acceptance that by and large contracts will be based in England. Do you feel that you would be able to offer more support if the contracts were based in Scotland, in Strathspey for example, rather than Stratford? Mr Morton: There are two elements to that. One is the opportunity for companies in Scotland to be supported in developing in Scotland to win business from the Games. There is the possibility that companies from elsewhere, in Europe for example, might win contracts and what we then have is an opportunity to engage Scottish companies, say on a sub-contract basis; in other words, you have a local presence within the United Kingdom. If that were an opportunity that we could capture for Scotland, we should be very keen to pursue it. We should be keen to pursue beyond that. If there were such international companies which traded in the United Kingdom on the back of the Games and they could be persuaded that ultimately Scotland was a good place to do business, we should be keen to encourage them to do so as well. Ms Cook: We should be using the SDI, Scottish Development International, to assist in that and, maybe just to explain, the contracts will not necessarily all be south of the border and you just quoted a couple of companies which had already secured contracts. If you call on Queensland's experience of the Sydney Games, they had over Aus$400 million worth of contracts in the Queensland area. So we should be looking to chase these contracts; we shall chase them overseas as well, looking to sub-contract back. Q217 Mr MacNeil: In short, you are saying that it is difficult at this stage to spell out or to flush out the potential benefits of the Games? Mr Morton: It is difficult to quantify. We can qualify because we know where the seams of opportunity might lie which are best suited to Scottish Enterprise's lead role in economic development. I understand that it would be good to be able to say we can get X or Y percentage of this added value. All I can say to you at this point, until we can quantify that, is that it is our aspiration to go for the maximum possible. Q218 Mr MacNeil: Do you see anything concrete being built in Scotland as a result of the Games at all? Mr Morton: I understand you have heard from COSLA and are due to hear from the Minister, Patricia Ferguson, about the investment which is taking place, some £230 million of investment in venues and various other sports facilities, which will help to encourage the development of high quality sport within Scotland and actually set a good foundation hopefully for what will be the Glasgow Commonwealth Games in 2014. Again, a good reason why we should want to make sure that we take advantage of the learning opportunity for Scotland from being involved in the London Olympics, so that we are well placed to apply those outcomes to the Commonwealth Games. Q219 Mr Davidson: May I ask about construction and can you just clarify how realistic you think it is for us to anticipate any success by Scottish firms in winning construction contracts for the Olympics? Mr Morton: I think there is scope for that. There is technical excellence in the construction industry in Scotland which would give at least a prospect of a competitive positioning. When you speak to some of the construction companies, there is a concern in the general aspects of that business that the London Olympics, in creating 33,500 jobs, might actually suck quite a lot of skilled people out of Scotland. If you look at it in the round, the £2.375 billion for the Olympics is about three per cent of the UK value of the industry overall, so it will have an impact. What we should do in Scotland is maybe two-fold. We have a £35 million construction skills initiative already, which is recognising a tremendous growth in demand in the industry within Scotland, so we are supporting that, we are active there. We are keen and in fact at the moment we are considering the establishment of a Construction Innovation Technology Centre to try to increase the quality of the businesses, but if there were a leaching of skills out of Scotland, I think we would then be in a position to gear up to make sure that we can train people to fill any potential vacuum and also we would benefit from the skills of these people in the construction industry. Q220 Mr Davidson: There are skills shortages in construction in Scotland now. Mr Morton: There are. Q221 Mr Davidson: What guarantee can we have that with greater demand further down the road we shall actually be able to win contracts in London when, in my view, it is much more likely that it would be built by Eastern European labour than by Scottish labour? Is construction not one of these areas that we could just write off and accept that there are not going to be gains there and we should focus on areas where we actually can genuinely make a difference, as distinct from just trying to say that we shall get involved in everything? Mr Morton: I certainly would not say that at this point; it is far too early. We should not write off any sector where we think there is an opportunity that businesses in Scotland could be competitive for tendering opportunities. I should be optimistic about that. You are right to say that there is a skills issue in construction trying to meet the demands already placed, which is why Scottish Enterprise is making this £35 million investment to try to bring forward within the labour market the sorts of skills that the companies will require to remain competitive. Q222 David Mundell: Has any form of modelling been done relative to the skills sets which are required? The Scottish Executive have a very large advanced programme of civil engineering works such as the construction of the M74 northern extension, construction of a railway between Edinburgh and Galashiels, but whilst you are touting to do work for the London Olympics, that would be compatible with all this work that is due to go on in Scotland almost within the same timeframe. It does seem to me rather odd that we shall be looking to do construction contracts outwith Scotland when we might not have sufficient skill within Scotland actually to deliver these major infrastructure projects which have been committed to. Mr Morton: You are quite right that there is a tremendous demand upon the industry. You have mentioned some of the large-scale infrastructure investment in Scotland. You could add to that, the Clyde Waterfront or the Clyde Gateway or ultimately the redevelopment of Ravenscraig. There are plenty of instances where the construction industry is going to be engaged. Again, in recognising that, that is why we have the £35 million investment, but the way the market will dictate the companies that are competitive, we should like to think Scottish companies will be in there tendering and they might well be successful in winning business. If that were the case, we would have to factor that in as another strand of the support we would need to give to skills development in that particularly important industry in Scotland. What I am saying is that, if companies in Scotland do get involved, there is value back to Scotland both in their winning the contracts and also in the skills that the workforce engaged in the Olympic construction would bring back to the country ultimately. Q223 David Mundell: There is a capacity issue, is there not? Mr Morton: Yes. Q224 David Mundell: Is anybody looking at that specific capacity? Ms Cook: Yes, Scottish Enterprise is working really closely with the Scottish Construction Industry Training Board and they have an arm called Construction Skills. They are setting up what they call observatories around the country and the idea is exactly that, to monitor what is happening and to forecast ahead. So we are working very closely with the industry to look at where the peaks and troughs are going to be and to try to level some of these out and provide the skills necessary to meet the peaks. Q225 Danny Alexander: Moving on from this subject, in your submission you make quite a lot of play of the Australian example as giving a sense of the extent of the potential benefits which might be available, but obviously a lot of the evidence in the Australian example would be benefits which would have accrued to the Sydney area, so the parallel in this case would be benefits accruing to the London area. Do you have any more information about how more peripheral regions of Australia, such as Western Australia or Queensland for example, might have benefited, rather than looking at Australia as a whole? That information gives a measure of how beneficial the Olympics might be as a whole, but not really what the extent of the opportunity for Scotland might be. Ms Cook: The comparable one that we have is Queensland. We are very fortunate in Scotland in that the chief executive of EventScotland was actually working in Queensland on the Olympics at the time of the Olympics. He has brought all that experience with him. The evidence we have is primarily from Queensland. Mr Morton: That is a good point. It is difficult to know at this stage how best to position Scotland so that we do maximise the opportunity. We can certainly, as we shall be doing, undertake further benchmarking research to see what happened in Australia, what worked, what devices they used to try to encourage economic development to disperse to different areas. I know, for example, that the legal services for the Olympic Games were sub-contracted out of the immediate area of Sydney. We do not anticipate that all of the critical massing of the benefit will be in one place, in this instance London and the South East. We should be very keen to identify the opportunities, to make sure that they are as dispersed and as much to Scotland's benefit as we can make them. Ms Cook: Also with Melbourne and in the Queensland area one of the things they found, in the build-up period to the Games and afterwards, was a huge increase in the conference industry. We are very fortunate in Scotland that we have excellent convention bureaux which are already very successful. I should imagine, and this is based on evidence that we have obtained, that by targeting conferences in the lead-up to the Olympics there are certain conferences that might follow the Olympics and we shall certainly be using all of resources to bid for these. Q226 Danny Alexander: I noticed that the Australian Government in the run-up to the Olympics were promoting a number of initiatives like "Australia Open for Business" for example, which was about attracting international business into Australia, using the Olympics as a lever to attract international business into Australia. I know that is not something you really address in your submission about using the Olympics to improve Scotland's international business links, but is that something that is in your thinking as well? Maybe you could spell that out a bit more? Mr Morton: Absolutely, this is a world event; the profiling opportunities which are associated with it for the United Kingdom and Scotland. We should certainly work with the Organising Committee and again with the various forms of the Nations and Regions Committee and organisations like VisitScotland, EventScotland, and COSLA and the local authorities to find out how best Scotland can exploit the branding advantage of association with the Olympics. For example, in our paper we mentioned that Scottish Enterprise in 2009 will be sponsoring the British Open as it comes to Turnberry to coincide with the Burns Homecoming event, which is a very significant cultural and tourism event which raises the profile of the country. It is distinctly possible by 2009 that we could also start to piggy-back the Olympic awareness-raising and the opportunities which might exist in Scotland and for Scotland to be profiled in association with that. So we are starting to think about how we can mobilise around the marketing opportunities by using the Olympic profile, but we should have to do that in concert with the organising bodies and our fellow travellers within Scotland. Q227 Danny Alexander: Just picking up on this issue of visitors. You talk in your submission about 1.6 million extra visitors to Sydney due to the Games, but, again, there is a question about how those people are then dispersed throughout the country. We might have a lot of extra visitors to London, but there are two questions related to that. Do you have any estimate of what proportion of those visitors you would then expect to come to Scotland? How closely are you working with VisitScotland and VisitBritain to ensure that when people do come to London for the Olympics, they are then exposed to information and so on which might then lead them to choose to go on to visit Scotland as part of their trip? Mr Morton: To a certain extent the answer to the first part of the question is in the second part of what you have just asked. It is working with VisitScotland and VisitBritain to make sure that Scotland is profiled and that people are aware of the opportunities in tourism if they are coming; if the magnet effect of the Games brings people to the United Kingdom, then it is worth their while and we can exploit their visit to Scotland as well. Ms Cook: Our role primarily would be with the actual companies. Our tourism team will be working with the tourism industry to make sure that when they do get to Scotland, they have a real quality experience. We shall be looking at things like packaging and how they are getting the message over, but we shall work very closely with VisitScotland on that. Mr Morton: To answer your first question about the target, at this point we do not have a specific target, but we shall be working with VisitScotland to see what level of the market they would expect to be able to generate for tourism in Scotland on the back of the Olympics, and that is something we could return to with you. Q228 Mr MacNeil: I am sure you have been speaking to LOCOG, the London Committee for the Olympic Games. I just wondered, after speaking to them, whether you are confident that the benefits for Scotland will be greater than, say, benefits for nations which are closer to London; I am thinking of France or Belgium or the Netherlands. Mr Morton: I certainly hope so. We are within the United Kingdom. We should be geared up to make sure that the Scottish business case related to the Olympics is there for all to see and hopefully to take advantage of. Q229 Mr MacNeil: Are you aware of any other countries hovering, say the Dutch or the Belgians or anybody like that? Mr Morton: Not specifically. Being Scots we are not afraid of competition, we merely surpass it. Q230 Mr MacNeil: Absolutely; international competition is what we need. Mr Morton: Absolutely. Ms Cook: One of the things that will help us is that we have already begun discussions with the London Development Agency which has been assisting us before the ODA, the Olympic Delivery Authority, is set up. We are going to set up the business club throughout the UK so the ODA, which will be responsible for procurement, will have a network of businesses within the business club and we shall be making life as easy as possible for the ODA to ensure they have access to all the companies that are required to deliver. Q231 Mr MacDougall: In paragraph 10 of your memorandum you refer to the Olympic Delivery Authority, which will be accountable for all public money raised by the sale of lottery tickets spent on getting venues and infrastructure ready. Is it your understanding that this money will be additional to any money which would be spent by the UK Government or by the Scottish Executive? Do you see it as additional money? Mr Morton: It is difficult to answer that specifically until we know how they intend to invest the money. I should imagine that it would come from a variety of sources, but whether or not there is a realignment of existing spend within the United Kingdom priorities is difficult at this stage to say. Within Scotland we should try to recognise the priority to encourage growth within the Scottish economy that the Olympic Games represents. Quite a lot of our own funding would be geared to the recognition of that priority. We should have to make a business case within Scottish Enterprise in any event, to make sure that that was the line followed, but if there were a case for additional funding in Scotland, that business case would be the basis of an argument that we would then take constructively, hopefully, initially to the Scottish Executive. Q232 David Mundell: I just want to come back to a point which was partly raised by Angus. Many of your summations are based upon the Australian experience but Australia is quite a different destination to London and it is quite easy for people to come in and out of London for a week, a weekend. You could not contemplate going to Australia for a weekend; you would be more inclined to go there for a month or six weeks or whatever. Do you not think that some of the inferences that have been drawn might be inaccurate because people could simply come here, particularly from Europe, even from the United States, for relatively short periods, go only to the Games and then leave the United Kingdom? Mr Morton: This bears also on the earlier question from your colleague about how relevant the Australian experience is. Bearing in mind that it is not the most recent experience upon which to draw, it does not mean to say that we shall follow blindly everything that happened there. I think you are quite right that the nature of the visitor market might be quite different and we should need to gear up accordingly. You could argue that we should have the benefit of both. You might have people who would come for a long duration because they wanted to participate in the entire Games, first of all as a spectator, which means that we have that particular area to try to address with our tourism product, but, because it is the United Kingdom, it also opens up the short stayer, the visit market which relates to specific cities. So we might actually be slightly better off in terms of the span of the market that we are trying to address than the instance you gave us, the precedent from Australia. Q233 David Mundell: Is no evidence yet available from Athens as to what happened there? Mr Morton: No evaluation has been done which indicates the pattern of what happened in terms of the legacy effect. Ms Cook: Some work has been done, but the reason we keep going back to Sydney is that it is the most comparable; you can go even further back than Sydney. What is happening is that every time you have an Olympics, the knowledge is growing and growing and growing. While Athens is not as comparable as Sydney, the trends have been that people have visited the Olympics, they have seen some of the athletics or whatever and they have built in a tourism visit. As you say, we shall get the market from Europe, it is a much closer market, but then we shall get the American and the Australian market and the New Zealand market and one would imagine they will come for longer stays. Q234 Mr MacNeil: Is there any evidence from the 1992 Olympics in Barcelona that there was any sort of benefit to Seville or Bilbao or Santander or any other cities in Spain of that kind? Ms Cook: There is some evidence, but I am afraid I do not have it readily to hand. I am quite happy to provide it. Q235 David Mundell: Another point which you also touched on was in relation to the Commonwealth Games. The Scottish Executive's own position would appear to be that one of the main benefits to Scotland of the London Olympics is reinforcing the Glasgow Commonwealth Games bid. Is that also your view? Mr Morton: I think there is an obvious synergy between the two and I can understand why the Scottish Executive wants to see that link made. There are some very tangible potential benefits. For example, if you wanted to run the Commonwealth Games, the learning opportunity of participating in the Olympic Games in London would be a great asset to you; they are only two years apart. So I can understand that and, from our point of view, we should support the Scottish Executive's stance on trying to recognise the complementarity and looking at the practical synergies so that by the time the Commonwealth Games come around, we are not to the same extent having to reinvent the wheel, we are not at a standing start, we are actually building on the body of knowledge which one represents to the benefit of the other. Q236 Danny Alexander: I just want to make an observation and ask a question. In response to quite a few of the questions that we have put, questions about tourism and questions about construction and so on, there has been quite a substantial degree of uncertainty in your answers, both in terms of estimates of the potential benefits, but also in terms of targets and what the process is for setting of targets. I can understand, given that we are only a few weeks, months away from the decision being taken, why there would be some uncertainty about the targets and so on, but it does strike me that we do need a bit more clarity on what the process is by which those targets are going to be set. If we are not clear from Scotland's point of view as a whole, and I appreciate that Scottish Enterprise does not represent the whole of Scotland, there is Highlands and Islands Enterprise as well, unless there is a clear process for setting those targets, and all these relevant agencies are working together to set those targets and then deliver them, then we could spend a lot of time talking about the potential benefits, possibly several years, and never have a clear idea of how we are going to get a handle on what they are and how we are going to deliver them. I suppose I am interested then, accepting that there is uncertainty at the moment, in what the process and timescale are by which targets will be set so that we can have a real sense of where the public sector in Scotland sees the benefits being and how they are actually going to be delivered. Mr Morton: I am going to give you two initial responses and then I shall pass over to Jane. You are quite right that, for reasons that we have already declared, it is early and it is very difficult to be able to put a finger on tangible information which allows us to quantify the potential benefits. It would be foolhardy of me, on behalf of Scottish Enterprise, to speculate on that and then have to come back to you and explain how we got that spectacularly wrong. That would be hope in place of expectation. The second thing is that, as an organisation, we are very accustomed to having targets that we work to and being accountable for them once they are set. The question you ask about process is a very good one and some of that process is clarifying as time passes, but a lot of it will come through the London Organising Committee and, again, through the various nations and regions sub-sets, one of which will be in Scotland starting in January. Jane, do you want to elaborate on that? Ms Cook: Being the person at Scottish Enterprise who is going to have to meet the targets set for me by my boss, we shall be meeting as part of the steering group and the first meeting is going to be in January next year. Julia Bracewell will be chairing that group and I have already had some discussion with Julia. The reason for starting to put together targets within that group is very much the fact that we shall all be round the same table. We shall be looking at targets and events, getting events here prior to the Games, looking at getting conferences here prior to the Games, looking at when the facilities are going to be built, when the contracts are going to come out. A lot of that will come when the ODA is set up. They are looking at the next tranche of contracts in July, so it is like fitting together a giant jigsaw puzzle and it would be crazy to put a finger in the air now. We can say we know what Brisbane did, we know what Sydney did. We could estimate, but it is much better to sit round the table with the public sector organisations which are going to be involved and set real, achievable targets. Once we are together in the nation group, then we shall start to put targets together and once we know what the timescale is for the contracts, which to me is a really important piece of jigsaw, one of the corners, once we know when the contracts are going to come on stream, then we can start to set how many companies we are going to reach, how many seminars we are going to run, how we are going to raise awareness of when the contracts are coming out. As you can appreciate, it is a massive jigsaw puzzle, but as soon as we can get together in the new year, we shall start to put it together. Mr Morton: We should be very happy to come back and explain that when the information is available. I am not ruling out the value or the potential value of some of the targets being aspirational; they do not all have to be market researched, they do not all have to be substantiated on that basis. There is a benefit in trying to stretch them both beyond that, but we should tell you at that point which of the targets are aspirational and that we believe we might get there if certain things happen, as opposed to what we might be able to predict could happen. Q237 Mr Davidson: Could I ask for clarification? When we were discussing this question of targets and how your priorities might be focused on what is being done in the Olympics, is there not an extent to which your overall work pattern might be distorted by the Olympics, being a one-off, and that you might be taking your eye off the ball of what your main bread-and-butter, ongoing work in Scotland is, because this is a one-off, highly prestigious, high profile and all the rest of it? Mr Morton: I think not, and the reason I say that is because Scottish Enterprise has the lead, but is not the only organisation in Scotland involved in economic development. If we have one primary objective, it is to contribute more to the growth of the economy in Scotland and we would constantly scan the opportunities that are there and we would prioritise accordingly. In the normal process of things, that landscape will include the upcoming Olympic Games and indeed the Commonwealth Games. Q238 Mr Davidson: So you are ready to fight more than one war at a time. Mr Morton: Yes; we have had quite a lot of match practice in that regard. Q239 David Mundell: Being the concerned people we are, we are also concerned for the legal profession in Scotland and its future fee income. How confident are you that any of the contracts will actually be done under Scottish law rather than the English and Welsh legal system? Will those in the legal profession be able to benefit at all from contracts and legal services? Mr Morton: That is a very good question. I should not be foolhardy enough to speculate an answer on technical differences between Scottish law and anything else within the United Kingdom. The profession in Scotland is sufficiently robust, and has a very good reputation, that the services it can offer will meet the demands of those purchasing them and I should imagine that Scottish law firms will be in quite a competitive position. That would be my hope. Q240 Mr McGovern: Could you explain how IBM created 32 new patents through their contract with the Sydney Olympics? Ms Cook: One of our objectives will be, when Scottish companies have actually secured contracts, to work with them with our research and development arm to maximise these opportunities. IBM is just an example which was quoted to me by the Australian Consulate. If a company has to deliver a contract and we can work with them using the programmes we have at Scottish Enterprise and technology development, we should hope to deliver these contracts in a way which will gain new patents and therefore give the company access to additional contracts and additional work elsewhere. It is a great way of showcasing the technology, innovation and capabilities of Scottish companies. Mr Morton: It is a small example of a larger point which we were trying to make and that is that there is a great opportunity here to learn how to make economic development dividend sustainable. That might most obviously be in some of the ways that the events are constructed or are managed. If there are business opportunities which add value, we shall not necessarily be content if they are short-lived. We want that to be an enduring legacy of benefit to growth in the economy in Scotland. Patents are just an example of that. If there is a piece of technological innovation, then that allows a more competitive position for that business to win contracts elsewhere. Q241 Chairman: Scottish Enterprise's memorandum states that tourism is one of their priority industries and you have sportscotland and EventScotland to attract international events. Can you tell us what other initiatives you are going to take? Mr Morton: When we say that is one of our priority industries, Scottish Enterprise is very keen to focus support on a number of business sectors or types in Scotland where we believe we have a distinct advantage and tourism is one of those. We would work very closely with VisitScotland in terms of trying to understand where the market opportunities are. To come back to this point about setting targets, be they aspirational or not, Scottish Enterprise is an economic development agency and where we believe we can add greatest value would be in supporting the businesses which would either grow or develop to take advantage of these contracts and also to play our part alongside VisitScotland. When they are trying to market Scotland, we should want to make sure that we sang from the same song sheet. The profile-raising was a way of putting something tangible back into the economic development of our country. Q242 Chairman: I can understand that your primary objective is to support businesses, expand businesses and probably create new businesses, but how do you get involved in attracting holidaymakers to Scotland? Mr Morton: Technically that is quite clearly the role of VisitScotland; it is their purpose in life. We should support what they want to try to achieve and the manner in which they deliver this. That is something which would be agreed in the steering group, where the respective and complementary roles of all the bodies in Scotland, COSLA, VisitScotland, sportscotland, EventScotland, Scottish Enterprise, Highlands and Islands Enterprise, were all identified and geared accordingly. Q243 Danny Alexander: Many different agencies are involved in this and you clearly have committees meeting together. I appreciate that there are lots of different ways in which Scotland can benefit from the Olympics, but who is in overall charge? If you have a committee which meets, is there one organisation, one body, one individual who is going to be making sure that all the different agencies are fulfilling their part of the remit to help Scotland benefit? Ms Cook: That is basically the remit of the chair of the Nations and Regions Steering Group, Julia Bracewell, who is chair of sportscotland. Just to give you an example on the tourism side of joined-up thinking, in VisitScotland we are very involved with VisitUK to bring visitors in. Where we get involved is getting the companies to work together to form packages. The visitor wants to get off the train or plane in Glasgow and know that they are going to get a quality package. They can stay at an hotel, their ticket will have lunch at a great Glasgow restaurant, a day trip through to Edinburgh or down the coast. We shall be making sure with the industry that once we actually get them there, their visit will be a quality one. Mr Morton: That is a very practical answer, which is appropriate. At a higher level there is also the Scottish Executive and the Minister for Culture, Media and Sport and it is very important, as she will no doubt tell you in due course, that she has a role overseeing all of this. We, as an agent of Government, have a very specific role to play. We understand that role and we are well versed in working alongside organisations like COSLA and its constituent local authorities, VisitScotland, sportscotland and EventScotland, each playing to their own strengths. Our specific role is to contribute to economic development and hopefully growth in the economy. Q244 Chairman: During our meeting with COSLA, we were told that local authorities play a significant role in promoting tourism. Are you working with them in partnership or how are you involved with them to attract more tourism? Mr Morton: The engagements with local authorities across Scotland, particularly in the context of our network of local enterprise companies, are probably too numerous to mention, but many of these do have a bearing on the promotion of tourism; that is in concert with the Scottish Executive and particularly VisitScotland which has that profile-raising, marketing remit. For example, one of our enterprise companies, Scottish Enterprise Ayrshire, and the three local authorities in Ayrshire would be very actively involved in the Burns Homecoming to try to capture, not just for their own part of Scotland but for Scotland, the maximum number of visitors which could be delivered on the back of that very significant event. Q245 Chairman: There is huge potential and a huge potential challenge as well. Are you and your partners ready for this challenge? Mr Morton: Absolutely. Ms Cook: Yes; absolutely. Ms McDowall: Yes. Q246 Mr Davidson: We have been asked to consider whether or not it would be beneficial for Scottish sport if we had a separate Scottish Olympic team. May I just clarify this in terms of the economics of all of this, the benefits to tourism, the benefits of gaining contracts, whether or not you believe that there is any evidence that would make any difference? Mr Morton: I thought about this question in case it arose and my initial response, which I hope you do not think is in any way disrespectful or facetious, is that being a longstanding Partick Thistle season ticket holder, I do not know anything about football. I can only respect the right of the SFA to make the decision as regards football without any observation on it. I believe that with the Team GB approach to the Olympic Games it is very important that Scotland is geared up in terms of sporting excellence in order to take advantage of that and that comes back to Scotland. Whether it would be any different if there were anything other than a Team GB, I would not hazard a guess. Q247 Mr Davidson: Is that a "don't know" then? Mr Morton: That is a "don't know". It is not so much a "don't know" as "I don't intend to answer that question". Q248 Mr Davidson: I did suspect that, but I do think it is a question which we are entitled to ask. Mr Morton: Absolutely. Q249 Mr Davidson: You are absolutely meant to be the experts in terms of economic development and tourism spin-offs and all the rest of it. Mr Morton: Indeed. Q250 Mr Davidson: Therefore the question of whether or not there would be any economic development gains or tourism benefits from having a separate Scottish team is one which we are quite entitled to ask you. I am not sure that it is entirely reasonable for you to decline to tell us. Maybe you could reconsider slightly whether or not you would want to give us any information one way or the other. Mr Morton: In all honesty, I do not have an answer at this time. I have no evidence upon which to base a judgment. I have given you an opinion and I entirely respect the origin of the question and the reason it was asked and I have answered it to the best of my ability. Q251 Mr Davidson: I see that Ms Cook is a former judo international for both Scotland and Britain and therefore presumably not a woman to be messed with. Can you give us an indication, as a former sports person, whether or not you think it would make any difference to Scotland were we to be represented by a separate Scottish team? Ms Cook: I guess, with my sports hat on, that my answer to that would have to be that it is not within our gift. The IOC dictate --- Q252 Mr Davidson: I know that. I understand that. That was not the question I was asking you. I was asking you whether or not you thought there would be benefit to Scotland in terms of sport were we to have a separate Scottish team at the Olympics. Ms Cook: It is something I have never considered, on the basis that we do not have that gift. My understanding, from speaking to other athletes in Scotland, is that they are absolutely delighted to be part of Team GB. I cannot say much more than that. Mr Morton: In all fairness the only answer which could be given would be one of personal opinion. You asked me about economic benefit and that is a reasonable question: I have no evidence on which to base that judgment. Q253 Mr Davidson: We also had a suggestion, which personally I regard as a crackpot one but which nonetheless it is reasonable for us to put it to you, that Scotland would perhaps benefit from being part of an EU team. I hasten to add this was not suggested by any of the members who are presently here, but nonetheless the point was raised. Is there any evidence that were Scotland to be part of an EU team there would be any economic or tourism benefits flowing as a result? Mr Morton: Not that I am aware of. Q254 Chairman: May I thank the witnesses for their attendance this afternoon. Before I declare the meeting closed, do you want to add anything on the subject which was not covered already during our questioning? Mr Morton: I do not think so. I should just like to thank you for the opportunity and again to repeat our willingness to come back and perhaps answer your question in a more substantive fashion in time. I hope you understand that we are still at quite an early stage. Chairman: Thank you once again; your evidence will be extremely helpful when we compile our report. Thank you. |