The future of forestry in Scotland: consultation

Introduction and background

Scottish Ministers continue to recognise the importance of both public and private involvement in forestry. We are committed to retaining the National Forest Estate ( NFE) - which covers over 640,000 hectares, equivalent to around 8.2% of Scotland's land mass - as an asset for the nation.

The forestry sector is estimated to be worth almost £1 billion a year to the Scottish economy, with over 25,000 full-time equivalent jobs in forestry-related businesses, as set out in the table below. ^[1]

	Jobs (Full-Time Equivalent)	GVA
Forest management, harvesting and processing	19,555	£771m
Forest-based tourism	6,312	£183m
Total	25,867	£954m

As well as the economic contribution, there are significant social and environmental benefits that assist delivery of wider Government objectives. Planting trees can help to prevent flooding and is an essential way of combatting climate change because trees absorb carbon dioxide from the atmosphere. ^[2] Access to woods improves health and wellbeing, from recreational facilities such as the mountain bike trails at Glentress to schemes which improve the quality of life for adults experiencing mental health issues. The development of diverse habitats, including the restoration of ancient woodlands, assists us in meeting our biodiversity goals.

Forestry is broadly devolved and policy is set by the Scottish Ministers but management of forestry in Scotland - including the NFE - has remained with the Forestry Commissioners. This is a UK Non-Ministerial Department with a statutory Board of Commissioners and, since devolution, a cross-border public authority.

Despite this cross-border status, there has been a direction of travel for forestry increasingly to be managed separately by Scotland, England and Wales. In 2013, the responsibilities undertaken by Forestry Commission Wales were transferred to a new public body - Natural Resources Wales - responsible for forestry, conservation and environmental regulation. Selected functions continue to operate on a cross-border basis across Great Britain (see chapter 2); however corporate services such as HR, Finance and IT, currently provided on a shared services model, are already in the process of being transferred to the individual countries.

In Scotland, the Scottish National Party made a commitment to take on full responsibility for all forestry issues in its 2011 manifesto. The Scottish Ministers announced in June 2015 that they would jointly explore options with the UK Government's Department for Environment, Food and Rural Affairs (Defra) to complete the devolution of forestry. This commitment was reiterated in the Scottish National Party's 2016 manifesto.

Since August 2015 a Forestry Governance Project Board, consisting of senior officials from the Scottish Government, Defra, the Forestry Commission and, more recently, the Welsh Government, has been considering options in relation to legislation, financial arrangements and cross-border functions. The desired outcomes of the Board's work are:

• Effective arrangements for the transfer of the Forestry Commissioners' powers and duties, as they relate to Scotland, to the Scottish Ministers;
• Equitable financial arrangements and an orderly 'de-commissioning' of the Forestry Commissioners as a cross-border public authority; and
• A legacy of refreshed and strengthened cross-border cooperation and partnership working between England, Scotland and Wales on relevant forestry matters.

This work is continuing in parallel with this consultation and will help inform the development of detailed legislative provisions.

The focus of this consultation is to invite views on our planned approach to new arrangements for the governance, development, support and regulation of forestry in Scotland. Consultation responses will inform our policy on how this can best be achieved, including legislative changes which we intend presenting for consideration by the Scottish Parliament. Primary legislation will be required in Scotland and the timing of that will be subject to the normal process of agreeing the Scottish Government's legislative programme. We will also require secondary Orders under the Scotland Act 1998 (which would be subject to procedures in both UK and Scottish Parliaments) to wind up the Forestry Commissioners as a cross-border public authority and make other consequential provisions in light of our primary legislation.

Stakeholders and members of the public are very welcome to respond to this consultation and are encouraged to respond to the whole consultation or any areas where they have a particular interest.

Chapter 1: New organisational arrangements in Scotland

The two main parts of the Forestry Commission in Scotland are Forestry Commission Scotland ( FCS) and Forest Enterprise Scotland ( FES). The latter is an agency of the Forestry Commission and, for national accounting purposes, is designated as a public corporation by the Office of National Statistics. Both FCS and FES are funded by the Scottish Government and operate as part of the Scottish Government's Environment & Forestry Directorate but they are not Scottish public bodies and thus are not currently subject to our policies and practices.

FCS promotes forestry, advises on and implements forestry policy, administers grants and regulates the forestry sector. FES is a land management body with responsibility for managing the Scottish Ministers' National Forest Estate ( NFE). The aims and objectives of both FCS and FES flow from the Scottish Forestry Strategy, and Scotland's Land Use Strategy, which set out the Scottish Government's vision for forestry and land use, and from the wider economic, environmental and social objectives of the Scottish Ministers (including timber supply, climate change, biodiversity, healthy living, tourism and education).

About one thousand civil servants work for FCS and FES. FCS staff are located in the Edinburgh national office and in five conservancies around the country, which provide guidance and implement policy and regulations locally and also carry out health, education and engagement programmes with local communities. The FES head office is based in Inverness with staff managing the NFE locally in ten forest districts across Scotland. In addition, 200 Forestry Commission staff, who provide some of the current shared services and cross-border functions (including research) as part of UK Government functions, are also located in Scotland.

The existing governance and accountability arrangements are complex and outmoded and do not reflect the post-devolution landscape or operating environment. The Forestry Commission itself is gradually moving its functions away from the centre to individual countries and, since 2013, there has been uncertainty about the remaining Forestry Commission GB arrangements.

Our proposals are designed to enable the state forestry sector to expand its contribution to Scotland's rural economy and to other social and environmental outcomes. We want to establish simpler and more straightforward governance arrangements so that the management of forestry in Scotland is fully accountable to the Scottish Ministers and to the Scottish Parliament.

With that in mind, we are proposing that the functions currently performed by FCS will come into the Scottish Government as a dedicated Forestry Division within the Environment & Forestry Directorate. FCS already operates as part of the Directorate and this will formalise that arrangement. It will help enhance policy coherence with other relevant national policies and strategies which sit within the Directorate, such as biodiversity, access, land use and wildlife (including deer management).

We also propose the establishment of a new forestry and land management Executive Agency of the Scottish Government. This will be formed from the existing FES and will be called 'Forestry and Land Scotland'. The management of the agency would be in keeping with the Scottish Government's established arrangements for Executive Agencies, including the requirements in the Scottish Public Finance Manual to have non-executive directors or independent external committee members.

The new agency will focus initially on the development and management of the Scottish Ministers' National Forest Estate to deliver specific economic, environmental and social outcomes, including maintaining the current guaranteed provision of timber to Scotland's timber processing sector, contributing to our climate change targets and environmental objectives, and transferring land to communities. Once this body has been established, we will consider how best to extend its remit to maximise the benefits of publicly owned land to the nation. We are continuing to develop our thinking in terms of what a land agency for Scotland might do and would very much welcome views from a wide range of stakeholders and interests on its purpose and remit in particular.

We have considered whether all forestry functions, i.e. those carried out by FCS and FES separately at the moment, might be combined into a single body. While we recognise that there are some merits in this proposal, for example, allowing a close association between policy and delivery and facilitating the interchange of skills and knowledge, we have concluded that it is not the most desirable approach.

Maintaining separation between the forestry policy and regulatory functions and the management of the NFE allows the two parts, which are already performing different functions, to focus and develop appropriate capacity in these activities. The dedicated Forestry Division will concentrate on improving policy advice, support, development and regulation, including the approach to driving the necessary work to meet or exceed our annual planting targets and to hasten the pace of planting approvals. As mentioned above, FCS is not responsible for all of the national policies which guide its operations and it makes sense to integrate forestry policy with the other relevant land management policies in the Scottish Government. This approach also has the advantage of addressing concerns from some quarters that there should be greater separation between the current regulatory FCS function and the regulated FES function.

A separate forestry and land management agency formed out of FES allows it to retain a clear focus on delivery and on developing its land management role and expertise. This is of particular importance as we intend to extend the agency's remit beyond the NFE and into wider land management in the future.

Under these proposals, existing FCS and FES staff would remain as civil servants. We recognise that the maintenance of professional skills and knowledge of forestry is an important consideration in the new organisational arrangements. Dedicated forestry arrangements that are both part of the Scottish Government would help this to happen and we would ensure that appropriate interchange between the Division and the Agency would be in place.

Questions

Our proposals are for a dedicated Forestry Division in the Scottish Government ( SG) and an Executive Agency to manage the NFE. Do you agree with this approach? Please explain your answer.

In bringing the functions of FCS formally into the SG, how best can we ensure that the benefits of greater integration are delivered within the wider SG structure? What additional benefits should we be looking to achieve?

How should we ensure that professional skills and knowledge of forestry are maintained within the proposed new forestry structures?

What do you think a future land agency for Scotland could and should manage and how might that best be achieved?

Chapter 2: Effective cross-border arrangements

There has been a direction of travel since devolution for forestry increasingly to be managed separately by Scotland, England and Wales. However, selected functions within the Forestry Commission continue to operate on a cross-border basis, mainly funded through Defra on behalf of the three countries but also with additional direct funding from the Scottish Government.

The current cross-border functions include:

Forestry science and research	Delivery of Science and Innovation Strategy for Forestry in Great Britain, including commissioning of research and development, development of evidence base, applied forest science expertise, production of technical publications.
Tree health	Delivery of statutory plant health and Forest Reproductive Material functions, including operations at the border on inspections at ports and airports.
UK Forestry Standard ( UKFS)	Communication and maintenance of the UKFS, the UK's agreed definition of sustainable forest management ( SFM).
Woodland Carbon Code ( WCC)	Management of the WCC, a standard for private investment in carbon benefits of afforestation.
Inventory / forecasting / operational support	Delivery of the National Forest Inventory Programme and generation of associated Official Statistics. Modelling and Forecasting for timber, biomass and carbon. Technical GIS and operational services.
Economics	Technical advice on forestry economics and economists' services such as evaluation, impact analysis, and financial instrument development.
Statistics	Gathering statistics on the UK timber industry, producing the Forestry Commission's UK National Statistics and Official Statistics releases and meeting UK requirements for international reporting of forestry statistics.
International forestry policy	Support for Defra on UK international forestry policy on behalf of Forestry Commission England and Scotland and provision of service for Wales and Northern Ireland. Represents UK on international committees on technical forestry matters.

We are committed to ensuring that there are ongoing effective cross-border arrangements where it makes sense. Given the relative importance of forestry to Scotland, it is essential that these arrangements meet Scottish needs and that our interests are fully represented and protected. Indeed it may be appropriate for Scotland to take the lead on some arrangements.

Work is continuing with the UK and Welsh Governments to consider the most appropriate arrangements for the future which will also be underpinned by legislation under the Scotland Act 1998. We believe that there are three particular priorities for continuing collaboration and co-operation:

1. Forestry science and research. Currently, most of Scotland's needs are met on a cross-border basis by the Forest Research Agency, which is an Executive Agency of the Forestry Commissioners. We want to ensure that future arrangements retain the continuity of the long-term research required on trees and also ensure that existing skills and expertise are retained.

2. Tree health. Continuing co-operation recognises that Great Britain is an island and pests and diseases do not respect country boundaries.

3. Common codes, such as the UK Forestry Standard and the Woodland Carbon Code. These allow the sector to operate a consistent approach to accreditation across more than one country.

Questions

Do you agree with the priorities for cross-border co-operation set out above, i.e. forestry research and science, plant health and common codes such as UK Forestry Standard? Y/N

If no, what alternative priorities would you prefer? Why?

Do you have views on the means by which cross-border arrangements might be delivered effectively to reflect Scottish needs? E.g. Memorandum of Understanding between countries? Scotland taking the lead on certain arrangements?

Chapter 3: Legislation and regulation

Legislation for and regulation of forestry are currently built on the Forestry Act 1967, which consolidated various Forestry Acts from 1919 to 1963. The powers and duties of the Forestry Commissioners are derived mainly from the Forestry Act 1967 and its subsequent amendments. Following devolution, the Forestry Commissioners were designated as a cross-border public authority for the purposes of section 88 of the Scotland Act 1998 and further Scotland Act Orders transferred the previous responsibilities of the Secretary of State for Scotland to the Scottish Ministers and modified the functions of the Forestry Commissioners.

The Forestry Commissioners are also the named authority in other legislation, including the Plant Health Act 1967 (which makes them the competent authority for the protection of forest trees and timbers from attack by pests and diseases, and gives them the power to make any necessary Orders), the Flood Risk Management (Scotland) Act 2009 and various pieces of secondary legislation.

We intend to introduce primary legislation in the Scottish Parliament ('the Bill') and make appropriate administrative arrangements to complete the devolution of forestry. With the agreement of the UK Government, this would be supported by appropriate administrative and legislative arrangements to unwind the current arrangements for the Forestry Commissioners to act as a cross-border public authority.

We intend that the Bill would:

• ensure the Scottish Government has control of all aspects of forestry in Scotland and introduce new arrangements for its governance, development, support and regulation.
• transfer the powers and duties of the Forestry Commissioners - as they relate to Scotland - to the Scottish Ministers. We will then use Scotland Act Orders to wind up the Forestry Commissioners as a cross-border public authority.
• facilitate establishing a forestry and land management body which will focus initially on the development and management of the Scottish Ministers' National Forest Estate. It will have the flexibility to use land for a variety of purposes and the potential to take on management of other publicly-owned land in the future.

We intend to take the opportunity to repeal the Forestry Act 1967 (and related forestry enactments) and replace this with a new and updated statutory framework for the regulation of forestry in Scotland. The main principles that we believe are important to include in the legislation are set out below.

Under section 1 of the Forestry Act 1967, the Forestry Commissioners are charged with a general duty of promoting:

• the interests of forestry;
• the development of afforestation;
• the production and supply of timber and other forest products;
• the establishment and maintenance of adequate reserves of growing trees; and
• using land in Scotland placed at their disposal by the Scottish Ministers in the way best calculated to contribute to the delivery of the targets set out in or under Part 1 of the Climate Change (Scotland) Act 2009.

We are minded to include in the new legislation a similar duty for the Scottish Ministers to promote forestry. We would welcome your views on what could specifically be included in such a general duty.

The next principle is a commitment to maintain international standards of good forestry, at present termed sustainable forest management ( SFM). SFM can be defined as "the stewardship and use of forests and forest lands in a way, and at a rate, that maintains their biodiversity, productivity, regeneration capacity and vitality and their potential to fulfil, now and in the future, relevant ecological, economic and social functions at local, national and global levels, and does not cause damage to other ecosystems" (Ministerial Conference on the Protection of Forests in Europe 1993). It reflects international obligations, following the 1992 Rio Earth Summit and more recently included in the United Nation's 2015 Sustainable Development Goals. The UK Forestry Standard currently provides the framework for delivery of SFM and is the basis of forest certification through the UK Woodland Assurance Standard, which allows forest and woodland owners to provide assurance of high standards of responsible management when selling their products.

Within this overall commitment to economic, environmental and social benefits, we are minded to include an obligation in discharging functions that delivers the same effect as the obligation under section 1(3A) of the Forestry Act 1967 to achieve a ' reasonable balance' between the development of afforestation, the management of forests, the production and supply of timber and the delivery of climate change targets and the conservation and enhancement of natural beauty and the conservation of flora, fauna and geological or physiographical features of special interest.

We also intend to include a duty to ensure that felling is carried out according to defined standards of good forestry and in particular that obligations to carry out restocking following felling are enforced. We see the latter as an important commitment to ensure continuing timber supply in the future. Repealing current legislation also offers an opportunity, including the taking of appropriate secondary legislative powers, to update the current regulatory framework for controlling the felling of trees (currently set out in Part II of the Forestry Act 1967).

The NFE already contributes to a number of outcomes, including supplying timber to the sector; providing recreational facilities; and contributing to environmental measures such as protecting biodiversity, restoring native woodland and peatland and managing deer. The current UK legislation also includes a duty on the Forestry Commissioners to use the NFE to contribute to the delivery of our climate change targets, such as the development of renewable energy schemes and the creation of new woodland, and a power to lease land to community bodies. We think that it is important to retain similar duties to these but to remove the current restriction in the Forestry Act 1967 that all these activities must be tree-related. To maximise the benefits of the NFE to the nation, we are therefore minded to include in the legislation provision for the flexibility to use NFE land for a variety of purposes in line with Ministerial objectives.

Questions

Should the Scottish Ministers be placed under a duty to promote forestry? Y/N

What specifically should be included in such a general duty?

Recognising the need to balance economic, environmental and social benefits of forestry, what are your views of the principles set out above?

Chapter 4 - Assessing impact

We are committed to assessing the impact of our proposals. This consultation marks the start of processes to assess the equalities, business and regulatory, privacy and environmental impact of our plans in compliance with legislative requirements and, importantly, to inform the policy development process.

Equality

In determining future arrangements for the management and regulation of forestry in Scotland, the public sector equality duty requires the Scottish Government to pay due regard to the need to:

• eliminate discrimination, victimisation, harassment or other unlawful conduct that is prohibited under the Equality Act 2010;
• advance equality of opportunity between people who share a protected characteristic and those who do not; and
• foster good relations between people who share a relevant protected characteristic.

These three requirements apply across the 'protected characteristics' of:

• age;
• disability;
• gender reassignment;
• marriage and civil partnership;
• pregnancy and maternity;
• race;
• religion and belief;
• sex and sexual orientation.

At this stage in our planning it is difficult to determine whether significant equality effects are likely to arise and the aim of the Scottish Government is to use this consultation process as a means to fully explore the likely equality effects.

Once completed the Scottish Government intends to determine, using the consultation process, any actions needed to meet its statutory obligations. Comments received will be used to complete a full Equality Impact Assessment and to determine if any further work in this area is needed.

Q: Are there any likely impacts the proposals contained in this consultation may have on particular groups of people, with reference to the 'protected characteristics' listed above? Please be as specific as possible.

Business and regulation

In determining future arrangements for the management and regulation of forestry in Scotland, a Business and Regulatory Impact Assessment will analyse whether a policy is likely to increase or reduce the costs and burdens placed on businesses, the public sector, and voluntary and community organisations. Your comments received will help inform a full Business and Regulatory Impact Assessment.

Q: Do you think that the proposals contained in this consultation are likely to increase or reduce the costs and burdens placed on any sector? Please be as specific as possible.

Privacy

A full Privacy Impact Assessment will be conducted to ascertain whether our proposals for the future management and regulation of forestry may have an impact on the privacy of individuals.

At this stage in our planning for integration it is difficult to determine whether significant privacy effects are likely to arise and the aim of the Scottish Government is to use this consultation process as a means to fully explore the likely privacy effects.

Q: Are there any likely impacts that the proposals contained in this consultation may have upon the privacy of individuals? Please be as specific as possible.

Environmental

The Environmental Assessment (Scotland) Act 2005 ensures that those public plans that are likely to have a significant impact on the environment are assessed and measures to prevent or reduce adverse effects are sought.

At this early stage in our planning it is difficult to determine whether significant environmental effects are likely to arise. We intend to explore this through the Strategic Environmental Assessment process.

Q: Are there any likely impacts the proposals contained in this consultation may have upon the environment? Please be as specific as possible.

Conclusion

The focus of this consultation is to invite views on our planned approach to new arrangements for the governance, development, support and regulation of forestry in Scotland. Consultation responses will inform our policy on how this can best be achieved, including legislative changes which we intend to present for consideration by the Scottish Parliament.

The questions throughout the consultation are repeated in a questionnaire at Annex A. However, in responding to this consultation, please do not feel constrained by the questions set. We appreciate some people will have a particular interest in certain areas. We would encourage you to respond to any or all of those areas where you feel you have a contribution to make.

We value your opinions and welcome your views on our proposals identified in this consultation document.

Question

Do you have any other comments that you would like to make, relevant to the subject of this consultation, that you have not covered in your answers to other questions?