Scottish Budget 2020-2021

Chapter 11: Environment, Climate Change and Land Reform

Portfolio Responsibilities

The Environment, Climate Change and Land Reform portfolio works across government to support and facilitate the pivot towards a net-zero trajectory which requires all portfolios to respond to the global climate emergency. The portfolio is also charged with protecting and enhancing our natural environment and resources. While there are significant challenges in this space there are also exciting opportunities to diversify our economy and to lead the world in transitioning to net-zero.

The overarching aim is to protect and promote Scotland's environment and to build a strong and sustainable net-zero economy through:

• tackling climate change;
• protecting our iconic species and landscapes;
• investing in biodiversity and natural capital;
• improving the quality of our air, land, seas and fresh water;
• developing a circular economy;
• empowering communities and improving the way land is owned, used and managed; and
• investing in the research base.

Portfolio responsibilities include sponsorship of Crown Estate Scotland (Interim Management), a public corporation established by Scottish Ministers to manage the Scottish Crown Estate assets from the point of devolution on 1 April 2017. Crown Estate Scotland (Interim Management)'s operating costs are funded from the gross revenue of the assets (and are classified as such as non-Vote expenditure) and the net revenue is paid into the Scottish Consolidated Fund.

Portfolio Priorities

Our priority for the year ahead is to respond to the global climate emergency and biodiversity loss. This will require a cross-government effort, with all portfolios tackling these twin challenges and to capturing the opportunities of transitioning our economy and protecting and enhancing our natural capital. We will ensure that our high quality natural assets - like our water, air, soils and nature - are the cornerstones of our economy, culture and quality of life and we will continue to ensure these precious assets are protected and enhanced.

The transition to a net-zero society is an essential investment for the future welfare of the people of Scotland, our economy, our environment and for those generations yet to be born. We lead by example with our ambitious statutory targets, strong progress to date and commitment to increasing our ambition in response to the Paris Agreement and our approach to a just transition where everyone benefits from the opportunities and no community is left behind. We will design policy to carefully consider where the costs and opportunities of the net-zero transition fall and consider innovative approaches to finance the transition.

Action across the portfolio contributes to the National Outcome on valuing, enjoying, protecting and enhancing our environment and supports a wide range of other National Outcomes. The transition to a net-zero economy is at the heart of our economic strategy. Ensuring this is a just transition will help support thriving and innovative businesses with quality jobs and provide fair work for all. It will tackle poverty by sharing opportunities more equally. The steps we are taking to build a circular economy and maintain strong environmental regulation ensures we have a globally competitive, entrepreneurial, inclusive and sustainable economy. Scotland's natural environment is a valuable health-promoting asset, with investment in our green and blue infrastructure encouraging a healthier and more active Scotland.

Taking advantage of the benefits of the circular economy, we are designing a deposit return scheme for drinks containers and are committed to introducing a Circular Economy Bill during this parliamentary session. This will support our world-leading action on climate change.

The portfolio is heavily impacted by EU exit, with essential funding, labour, scientific expertise and around 80 per cent of our environmental legislation coming from the EU. In line with our commitment to maintain environmental standards after EU exit, putting in place new arrangements for environmental law and policy will continue to be priorities for this portfolio.

Climate Change priorities

We will:

• update our Climate Change Plan to show how we intend to meet the new, more ambitious targets set in the Climate Change (Emissions Reductions Targets) (Scotland) Act 2019;
• support the establishment of a Climate Change Citizens' Assembly;
• continue to support the Just Transition Commission in its role to advise Ministers on a fair transition to a climate-neutral Scotland and contributing to the Economy National Outcome;
• respond to the global climate emergency by developing a net-zero transition strategy as part of a Green New Deal for Scotland to mobilise billions of investment into the transition;
• continue to promote increased global ambition on climate change;
• capitalise on COP 26 being held in Glasgow to enhance our international reputation, create economic opportunities and attract investment while building our international network;
• create Community Climate Action Hubs under the Climate Challenge Fund to more effectively support Scottish communities in making the transition to climate-neutral and climate resilient living and establish a network of Climate Action Towns;
• continue our work to ensure that Scotland is climate ready through delivery of our new Climate Change Adaptation Programme (SCCAP2);
• help ensure that all public bodies, as well as individuals, businesses and industry play impactful roles in the national endeavour to tackle climate change;
• help tackle the effects of climate change in the poorest, most vulnerable countries through our Climate Justice Fund and making a positive contribution to the International National Outcome;
• improve the evidence base around climate change action in Scotland, by developing the monitoring frameworks for our mitigation and adaptation strategies and starting work to establish a national Nitrogen Balance Sheet; and
• seek to ensure that EU exit does not adversely impact our policy goals and objectives for climate change.

Environmental Services priorities

We will:

• continue to work with partner organisations to reduce, and raise awareness of, flood risk across Scotland and support work to reduce the impacts of flooding on communities;
• provide an overall package of £5 million, boosting our commitment to the Biodiversity Challenge Fund, increasing action for priority habitats and species, and delivering additional improvements in ecological connectivity;
• deliver an ambitious multi-year commitment for investment into peatland restoration;
• continue investment to deliver River Basin Management Plans, delivering improvements to the water environment, and contributing to local economies and communities;
• consult on a draft new air quality strategy taking into account the conclusions and recommendations of the independent review of the current Cleaner Air for Scotland strategy, followed by publication of the new strategy. This will deliver further improvements in air quality and will help support the health national outcome;
• continue to support Scottish Natural Heritage (SNH), Scottish Environment Protection Agency (SEPA), our National Parks and the Central Scotland Green Network in their work to protect and enhance our world-class natural environment and improve biodiversity, to support inclusive and sustainable economic growth, and to promote the enjoyment of Scotland's environment and green space;
• continue the transition to a circular economy, cutting waste and carbon emissions and opening up new economic opportunities which will support the Economy National Outcome;
• legislate for an ambitious deposit return scheme that will work well for everyone in Scotland by reducing litter and making high quality recycled materials available to the Scottish economy; and
• ban the manufacture and sale of plastic-stemmed cotton buds and consult on what additional measures should be considered to improve the use and reuse of other materials.

Land Reform priorities

We will:

• develop regional land use partnerships to help all of Scotland's land contribute to the fight against climate change and begin work on the next iteration of the Land Use Strategy;
• continue to support community land purchases through our Scottish Land Fund;
• consider the recommendations of the Vacant and Derelict Land Taskforce;
• implement final aspects of the Land Reform (Scotland) Act 2016 by bringing into force a new community right to buy for sustainable development and developing a Register of Persons Holding a Controlled Interest in Land;
• hold an International Conference in 2020 to demonstrate progress on land reform and connect to global discussions about how land can support a range of outcomes; and
• continue to seek ways to enable everyone in Scotland to benefit from land, one of our most important assets.

Research, Analysis and Other priorities

We will:

• support the fifth year of the 2016-21 strategic research programme to drive research, development and innovation and support the Economy National Outcome;
• continue to seek efficiencies, impact and leverage from the research we fund;
• continue to support the work of the Royal Botanic Garden Edinburgh;
• establish new environmental governance arrangements to ensure that Scotland continues to fully implement environmental law after EU exit; and
• publish an Environment Strategy to set out our new overarching approach to environmental protection.

Marine priorities

We will:

• continue to safeguard and monitor marine and fisheries activity in Scotland's seas, coasts, rivers and ports to ensure that national and international regulations are enforced to protect the health of fish stocks and the marine and freshwater environment;
• deliver a Sectoral Marine Plan, identifying future locations for large-scale offshore wind developments and support research that will help address the sustainability of offshore renewables in line with the National Marine Plan's commitments;
• continue to implement legislation on the management of the Scottish Crown Estate, and progress longer-term reforms flowing from its devolution;
• distribute the net revenues from the Scottish Crown Estate marine assets out to 12 nautical miles to benefit coastal communities;
• support efforts to address the challenges facing wild salmon and freshwater fisheries and deploy a salmon pressures mapping tool to provide an improved evidence base;
• publish a multi-year national wild Atlantic salmon strategy;
• take forward with the aquaculture sector the farmed fish health framework to enable sustainable growth of salmon farming whilst minimising the environmental impacts;
• continue to safeguard our marine biodiversity, species and habitats, consulting on conservation strategies for seabirds and for dolphins and porpoise, improving the coherence and management of the Marine Protected Area networks, updating the UK wide marine monitoring programme, and developing new seal management measures;
• support efforts to reduce, reuse and recycle waste to minimise its impact on the marine environment, including working with the fishing sector and coastal communities on the issue of fishing litter and lost gear; and
• ensure we have assets and risk-based approaches to enforce regulations at sea following an EU exit.

Scottish Water priorities

We will:

• support the £3.9 billion 2015-21 Scottish Water investment programme: the provision of water and wastewater services is a key enabler of economic growth as well as fundamental to sustaining good health;
• invest to tackle ageing infrastructure;
• continue to mitigate and adapt to climate change supporting Scottish Water's efforts to achieve net-zero emissions by 2040; and
• continue the Hydro Nation agenda to maximise economic and non-economic value from our water resources.

Spending Plans

Table 11.01: Spending Plans (Level 2)

Level 2	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Research, Analysis and Other	65.4	66.6	71.0
Marine	52.1	64.7	65.5
Environmental Services*	133.5	134.1	157.1
Land Reform*	17.1	17.1	16.5
Climate Change and Land Managers Renewables Fund	21.9	22.7	30.3
Scottish Water	115.5	121.4	121.4
Total ECCLR	405.5	426.6	461.8
of which:
Fiscal Resource	153.6	168.5	175.3
of which Operating Costs**	-	63.3	70.1
Non-cash	12.0	13.1	16.5
Capital	239.9	245.0	274.0
Financial Transactions***	-	-	(4.0)
UK Funded AME	-	-	-

£23.0 million of expenditure has been reclassified from resource to capital in 2020-21, reducing the resource budget and increasing the capital budget by that amount.
* In 2020-21 Land Reform is shown as a separate budget, this was previously within Environmental Services and the previous year's budgets have been adjusted for comparison purposes.
** Scottish Government operating costs have been presented in this way within portfolio budgets since 2019-20.
*** The Financial Transactions total represents the net portfolio position after subtracting forecast Financial Transactions income. The gross amount of Financial Transactions for each portfolio is listed in the Infrastructure Investment Chapter.

Presentational Adjustments for Scottish Parliament Approval

Level 2	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Royal Botanic Garden (NDPB Non-cash)	(2.2)	(2.4)	(2.5)
National Park Authorities (NDPB Non-cash)	(0.7)	(0.9)	(1.0)
SEPA (NDPB Non-cash)	(2.1)	(2.7)	(4.9)
SNH (NDPB Non-cash)	(1.9)	(1.9)	(2.5)
Scottish Water loan repayments not included in Scottish Parliamentary budgets	43.0	37.6	46.7
Total ECCLR	441.6	456.3	497.6
Total Limit on Income (accruing resources)			500.0

What the Climate Change and Land Managers Renewables Fund budget does

The Climate Change budget and Sustainable Action Fund support the portfolio's climate change work, including adaptation and mitigation policy, while significant budgets elsewhere across government also support the delivery of our climate change ambitions. In addition, the budget provides resources for the Land Managers Renewables Fund.

Table 11.02: Climate Change and Land Managers Renewables Fund Spending Plans (Level 3)

Level 3	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Climate Change - Policy Development and Implementation	1.1	1.1	1.1
Land Managers Renewables Fund	2.0	2.0	0.5
Sustainable Action Fund	18.8	19.6	28.7
Total Climate Change and Land Managers Renewables Fund	21.9	22.7	30.3
of which:
Fiscal Resource	21.9	22.7	26.3
Non-cash	-	-	-
Capital	-	-	4.0
Financial Transactions	-	-	-
UK Funded AME	-	-	-

What the Environmental Services budget does

The budget provides funding for partners such as Zero Waste Scotland to help support the transition towards a more resource-efficient, circular economy. It supports SEPA, SNH, our National Parks and the Central Scotland Green Network in their work to protect and enhance our world-class natural environment and supports work to meet our European and international obligations and targets for biodiversity.

Table 11.03: Environmental Services Spending Plans (Level 3)

Level 3	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
National Parks	12.9	13.4	13.9
Environmental Quality*	14.5	14.7	10.8
Natural Resources, Peatland and Flooding	4.1	4.6	29.7
Scottish Environmental Protection Agency	35.0	34.4	37.1
Scottish Natural Heritage	46.5	46.5	49.1
Zero Waste	20.5	20.5	20.5
Zero Waste FT Repayments*	-	-	(4.0)
Total Environmental Services	133.5	134.1	157.1
of which:
Fiscal Resource	124.1	123.2	145.3
Non-cash	4.7	5.5	8.4
Capital	4.7	5.4	7.4
Financial Transactions**	-	-	(4.0)
UK Funded AME	-	-	-

* The budget for Flood and Coast and Tide Network (£3.2 million) which were included under Environmental Quality in 2018-19 and 2019-20 are now part of Natural Resources, Peatland and Flooding.
** In 2020-21, the financial transactions budget includes a £4 million planned repayment of a loan, which was advanced to Zero Waste Scotland (ZWS) in 2019-20 as a result of a delay in receiving European funding. The European funding (£4 million) will be received in 2020-21 and fully offset the loan repayment. There will therefore be no impact on the level of resource available to ZWS in 2020-21.

What the Land Reform budget does

Ongoing implementation of land reform policy, including final aspects of the Land Reform (Scotland) Act 2016 (new community rights to buy and development of Register of Persons Holding a Controlled Interest in Land); PfG commitment to host international land reform conference; resource to support PfG commitment to develop regional land use partnerships; resource to develop next iteration of Land Use Strategy; ongoing support for community ownership through Scottish Land Fund.

Table 11.04: Land Reform Spending Plans (Level 3)

Level 3	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Land Reform	17.1	15.6	15.0
Scottish Land Commission	-	1.5	1.5
Total Land reform	17.1	17.1	16.5
of which:
Fiscal Resource	5.6	6.6	6.0
Non-cash	-	-	-
Capital	11.5	10.5	10.5
Financial Transactions	-	-	-
UK Funded AME	-	-	-

What the Research, Analysis and Other budget does

The Research, Analysis and Other budget funds a portfolio of strategic research, knowledge exchange and expert advice in support of Scottish Government policies on a wide range of rural and agricultural topics, including the natural environment, crop and livestock sciences, animal welfare, and the rural economy. It also supports preparations for EU exit.

Table 11.05: Research, Analysis and Other Spending Plans (Level 3)

Level 3	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Strategic Policy, Research and Sponsorship	3.0	3.8	4.5
Economic and Other Surveys	1.4	1.4	4.2
Programmes of Research	47.7	47.7	47.8
Royal Botanic Garden Edinburgh	13.3	13.7	14.5
Total Research, Analysis and Other	65.4	66.6	71.0
of which:
Fiscal Resource	51.3	50.7	34.0
Non-cash	2.6	2.8	2.9
Capital	11.5	13.1	34.1
Financial Transactions	-	-	-
UK Funded AME	-	-	-

What the Marine budget does

The Marine budget supports the sustainable use of Scotland's marine and freshwater environment, and progress towards achieving national, European, and international obligations to protect the marine environment. Marine Scotland has responsibility for the marine planning of Scotland's seas and licensing of a range of activities in the marine environment involving key sectors such as marine renewables, sea fisheries, aquaculture, recreational fisheries and the evidence base required to support these sectors.

Table 11.06: Marine Spending Plans (Level 3)

Level 3	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Marine Scotland	52.1	64.7	65.5
Total Marine	52.1	64.7	65.5
of which:
Fiscal Resource	45.2	58.9	57.3
Non-cash	4.7	4.8	5.2
Capital	2.2	1.0	3.0
Financial Transactions	-	-	-
UK Funded AME	-	-	-

What the Scottish Water budget does

The budget supports the programme of investment by Scottish Water and helps to increase the benefit we can gain from the water economy both domestically and internationally through the Hydro Nation programme. The budget helps to support private water supplies, primarily through the provision of improvement grants; provides funding for the Drinking Water Quality Regulator for Scotland, for costs not directly recovered from Scottish Water.

Table 11.07: Scottish Water Spending Plans (Level 3)

Level 3	2018-19 Budget £m	2019-20 Budget £m	2020-21 Budget £m
Interest on Voted Loans	(100.5)	(100.5)	(100.5)
Voted Loans	210.0	215.0	215.0
Hydro Nation	4.0	4.7	4.7
Drinking Water Quality Regulator	0.3	0.5	0.5
Private Water	1.7	1.7	1.7
Exemption Scheme	-	-	-
Total Scottish Water	115.5	121.4	121.4
of which
Fiscal Resource	(94.5)	(93.6)	(93.6)
Non-cash	-	-	-
Capital	210.0	215.0	215.0
Financial Transactions	-	-	-
UK Funded AME	-	-	-

Contributions to National Outcomes

ECCLR

This table summarises the portfolio's contributions to the Outcomes of the National Performance Framework.

Table 11.08: National Outcomes

Climate Change and Land Managers Renewables Fund

Primary National Outcome: Environment

Secondary National Outcomes: Economy, Health, Communities, International

By reducing greenhouse gas emissions, we are increasing the likelihood of average global temperature rises staying below 1.5 degrees Celsius, avoiding the more catastrophic effects of global warming on biodiversity, human populations and the economy worldwide, including in Scotland. By taking a strategic approach to the transition to net-zero (a Green New Deal), we can position Scotland's economy to grow sustainably and ensure the transition is fair and no community is left behind. By being at the vanguard of a global move to low carbon economies, Scotland will be well placed to innovate and export low carbon technologies, solutions and business practices. By reducing the use of fossil fuels in the transport system, we will improve the quality of air that people breathe. And by involving everyone in the transition to climate-neutrality, we will ensure that both the benefits and the costs are shared fairly across all communities.

By engaging with international partners and through our Climate Justice Fund we meet our obligations internationally, promote our place in the world and deepen our relationships with others.

We will play a leading role to raise global ambition, including by delivering meaningful roles for Ministers and Scottish society at the UN Climate Summit - COP 26 - in Glasgow and making a positive contribution to the International Outcome. We will enhance our international reputation, create economic opportunities and build our international network.

The Green New Deal will take a strategic approach to grow our inclusive economy and support collective wellbeing by capturing the opportunities of the transition to net-zero. We will continue to support the Just Transition Commission in its role to advise Ministers on a fair transition to a climate-neutral Scotland.

We will work to protect and enhance our world-class natural environment, to support inclusive and sustainable economic growth, and to promote the enjoyment of Scotland's environment and unique natural heritage.

Environmental Services

Primary National Outcome: Environment

Secondary National Outcomes: Economy, Communities, Health

Delivery of River Basin Management Plans, with the support of the Water Environment Fund, will continue to make a positive contribution to easing the pressures on wild fish (e.g. Atlantic Salmon), preparing for climate change, and protecting and improving our rivers, lochs, wetlands and coastal waters for the enjoyment of all.

Our action to improve air quality contribute to improvements in both human and environmental health. We will consult on a draft new air quality strategy taking into account the conclusions and recommendations of the independent review of the current Cleaner Air for Scotland strategy, followed by publication of the new strategy, to deliver further improvements in air quality.

We will continue the transition to a circular economy, cutting waste and carbon emissions and opening up new economic opportunities which will support the Economy National Outcome.

Land Reform

Primary National Outcome: Environment

Secondary National Outcomes: Economy, Communities, Human Rights

Land has a major role to play in tackling climate change, particularly through how land is used. Regional land use plans will enable strategic consideration of how land can best be used to tackle climate change. Tackling long-term land problems like concentrated ownership and vacant and derelict land will support inclusive growth by helping to make more land available for a wider range of uses, and encouraging land to be used productively.

We will continue to support community land ownership and greater community engagement in decisions about how land is used and managed. Increasingly, we are viewing land through a rights-based approach, both as a right in itself and in delivering other rights.

Research, Analysis and Other

Primary National Outcome: Environment

Secondary National Outcomes: Economy, International, Communities

The Research, Analysis and Other budget funds a portfolio of strategic research, knowledge exchange and expert advice in support of Scottish Government policies on a wide range of rural and agricultural topics, including the natural environment, crop and livestock sciences, animal welfare, and the rural economy.

This research also provides critical insights into complex global challenges such as food security and climate change that helps inform policy development. Funding from this budget helps maintain science innovation and excellence and also supports critical infrastructure and research assets, including collections of national and international importance.

The Environment Strategy will help to guide our approach to protecting and restoring Scotland's environment and delivering our international responsibilities, including our contribution to tackling the global climate emergency, while also seizing opportunities to improve economic success and the wellbeing of our communities. The strategy will form part of our overall strategic approach on environmental policy, alongside future arrangements for environmental principles and governance.

Environmental governance will promote effective implementation of high environmental standards, which support our economy, and enhance the welfare of our communities.

Marine

Primary National Outcome: Environment

Secondary National Outcomes: Economy, Fair Work and Business, International, Health

Scotland's marine environment already provides a huge resource for improving wellbeing by offering attractive recreation and tourism opportunities. The 2015 Scottish Marine Recreation and Tourism Survey estimates that £3.7 billion is spent in Scotland on recreation and tourism activities across our seas and coastal communities. Our roll-out of marine protected areas (MPAs) and conservation measures have already started to show signs of adding to the wellbeing from our marine environment.

In 2020-21 we will continue to safeguard and monitor marine and fisheries activity in Scotland's seas, coasts, rivers and ports to ensure that national and international regulations are enforced to protect the health and sustainability of fish and shellfish stocks and the marine and freshwater environment in collaboration with the fishing industry and other key stakeholders.

Examples of past and future activities that contribute to the Environment National Outcome include:

• Completed the annual programme of fisheries data collection, ensuring international obligations are met under the Data Collection Framework and providing the data required to generate advice on catch limits to ensure sustainable fisheries.
• Use of ScotMER evidence maps to deliver research priorities to address knowledge gaps that are constraints to sustainable delivery of marine renewables. Development of dolphin and porpoise, and seabird Conservation Strategies. Monitoring underwater noise to assess status of marine environment via ECOMMAS and three EU funded projects.
• Conducted ICES assessments for 12 key stocks in European waters, and provided germane, relevant and timely advice for Scottish government ministers and stakeholders to facilitate profitable, responsible and sustainable fisheries.
• Co-ordinated annual stock monitoring of salmon and sea trout, applying Salmon Conservation Regulations to control mortality due to salmon angling.
• Co-ordinated a network of river temperature monitors and produced a mapping tool to identify priority locations for planting trees to shade rivers and protect young salmon and trout from high temperatures associated with climate change.
• Implemented the comprehensive annual marine environmental monitoring and assessment programme; work towards the update of Scotland's Marine Atlas.
• In supporting large-scale offshore wind developments we will encourage sustainable and inclusive growth whilst positively promoting a low carbon approach to generating electricity.
• New programmes of seabird tracking and surveys will inform the future conservation strategy for Scotland's unique seabird populations.
• Protection of Scotland's rich and diverse dolphin and whale populations in offshore waters west of Scotland will be strengthened using an array of deep-water passive acoustic monitoring devices.
• We will develop analytical models to understand the distribution of priority marine habitats and species on Scotland's seabed to enhance our management of protected nature sites.

Our approach to marine planning is seeking to maximise opportunities for improving health and wellbeing associated with Scotland's natural and historic environment. We are investing to tackle marine litter not only to protect our ecosystems, but to address the public health risks associated with plastic entering the marine food chain and to preserve our pristine marine environment for enjoyment by all.

Scottish Water

Primary National Outcome: Environment

Economy, Health, Communities

Scottish Water have developed a long-term industry vision to support its efforts to achieve net-zero emissions by 2040. This vision clearly identifies how it will transform the way it delivers vital services and improves technical standards. The vision highlights ambition for excellent water quality and enhancing the environment whilst remaining affordable to customers. It highlights the critical role the sector has in supporting the economy and creating a flourishing Scotland.

Scottish Water invests around £600 million each year allowing Scotland to enjoy extremely high standards of Drinking Water quality which ensures the essential health and hydration of the population.

Our Scotland the Hydro Nation programme includes the 'Your Water, Your Life' campaign which is proving to be a great success with top-up taps being rolled out across Scotland to allow people to hydrate using re-usable bottles.