Scottish Budget: draft budget 2018-2019

Chapter 12: Rural Economy and Connectivity

Portfolio Responsibilities

Rural Economy and Connectivity is a diverse portfolio, responsible for rural Scotland and wider connectivity (physical and digital) through working with the public, private and third sectors and with local communities. It includes the Scottish Government responsibility for farming and food production, the rural economy, food and drink, fisheries, aquaculture, forestry, digital connectivity, islands and the national transport network.

Our Priorities

Our overarching priority is to ensure that the future of opportunity at the heart of our economic strategy applies equally to Scotland’s rural, island and coastal communities and that all of Scotland has the traditional future and digital infrastructure needed to deliver real economic benefits and improved connectivity. We will do this by:

• delivering a reformed Common Agricultural Policy;
• enabling everybody in Scotland to access superfast broadband by 2021 – the only country in the UK to make this commitment;
• enabling and encouraging sustainable development, enterprise and investment in the rural economy;
• building on current success in our world-class food, drink and forestry sectors;
• repopulation and empowering rural, coastal and island communities;
• investing in low carbon transport and promoting active travel to deliver our climate change ambitions and to tackle poor air quality in towns and cities;
• providing vital transport links to improve physical connectivity, economic productivity, the environment, public health and social inclusion; and
• delivering our better journey times and transport connections, with reduced emissions and greater quality, accessibility and affordability.

Farming, Rural Development, Food and Drink Priorities

We will support our farmers and crofters to produce high quality food; sustainably and efficiently.

In 2018-19 we will:

• provide financial security and certainty to Scotland’s farmers and crofters by delivering the Common Agricultural Policy ( CAP) efficiently and effectively;
• implement our Plan for Stabilisation, reflecting the needs of our customers including ensuring that farmers receive payments promptly;
• within CAP, continue to deliver the Scottish Rural Development Programme ( SRDP), including continued support for agri-environment, farm advice and knowledge transfer, new entrants, crofting and the food and drink sector;
• maintain payments at 100 per cent for the Less Favoured Area Support Scheme to provide stability to farmers and crofters in rural and remote areas;
• continue to invest in the development of new IT and improved business systems to build our capacity including preparing for the UK’s withdrawal from the EU; and
• continue to work closely with partner organisations and the public to facilitate engagement on the SRDP as well as on broader rural policy issues, e.g. the Scottish Rural Parliament and the Organisation for Economic Co-operation and Development ( OECD) Rural Development Conference being held in Edinburgh in April 2018.

In addition, through our Rural Services budget, we will provide direct funding for farming, crofting, and rural development projects.

In 2018-19 we will:

• provide support to the National Council of Rural Advisers to develop policy and principles for future rural support based on the best available advice, research and expertise;
• listen and respond to the Agricultural Champions who are advising us on possible future agriculture support options;
• support collaborative working between public agencies and the private sector to progress key economic development projects in the south of Scotland, as a key milestone towards a Scottish rural infrastructure plan;
• produce a rural skills action plan in 2018 to enhance employment opportunities for young people;
• provide support to the Farming Opportunities for New Entrants working group as they develop opportunities for New Entrants in Scotland;
• monitor for the presence of plant and animal disease, prevent, control or eradicate any outbreaks, and improve the welfare of kept animals including protection of the health of animals and humans;
• deliver against key action areas in relation to climate change mitigation and adaption, ensuring that the agricultural sector continues to contribute towards building a low carbon, climate-resilient future for Scotland;
• continue to take forward a range of priority actions on crofting, including production of a national development plan for crofting and progressing review of crofting legislation; and
• take forward the actions recommended by the Women in Agriculture Taskforce aimed at increasing gender equality in the sector.

We will continue to support the growth of the food and drink industry and help it deliver its ambition to double its value to £30 billion by 2030. Our key focus is to promote locally sourced and locally produced food and drink to a range of markets by:

• investing £7.5 million to support the delivery of the new industry-led strategy, ‘Ambition 2030’;
• continuing to support businesses to invest and expand through our Food, Processing Marketing and Cooperation grant scheme;
• sourcing more local produce through public sector contracts and investing
  £0.4 million to expand the Food for Life Programme in schools;
• introducing a new supplier development programme to support small suppliers obtain third-party accreditation to help them target new domestic and international markets;
• supporting more local producers to showcase their produce locally and nationally through new regional showcasing events and the launch of a new Regional Food Fund; and
• progressing the Good Food Nation objectives through the development of the Good Food Nation Bill and the work of the new national chef.

Fisheries and Aquaculture Priorities

We will continue to build growth across Scotland’s marine and coastal communities, supporting employment and securing investment, by delivering sustainable economic growth in the sea fisheries and aquaculture sectors, with due regard to the environment.

In 2018-19 we will:

• maximise the benefits of the European Maritime and Fisheries Fund ( EMFF) to create and safeguard jobs in remote rural areas and to support community-led local development;
• continue to develop and sustain markets for premium Scottish seafood products through the EMFF;
• establish a strategic fish health framework to support the aquaculture sector’s 2030 sustainable growth ambitions; and
• continue to offer harbours funding towards repairs caused by storm damage.

Forestry Priorities

Forestry contributes almost £1 billion per year to the Scottish economy and supports more than 25,000 full-time equivalent jobs. Our Programme for Government includes ambitious plans to maximise the contribution of forestry and woodland to Scotland’s economy, our climate change ambitions and to wider social, health and environmental benefits.

In 2018-19 we will:

• support actions to meet our annual planting target of 10,000 hectares including implementing the Mackinnon Report recommendations to streamline the planting approval process;
• increase support for the Forestry Grant Scheme and support projects through the Strategic Timber Transport Fund;
• manage the Scottish Ministers’ National Forest Estate to deliver economic, social and environmental benefits; and
• prepare for the completion of forestry devolution.

Digital Connectivity Priorities

The Scottish Government is the only government in the UK that has committed to delivering superfast connectivity for all. Building on our target of delivering fibre access to at least 95 per cent of premises by the end of 2017, we will now ensure that everybody is able to take full advantage of the opportunities of the digital world. This is critical to the future economic success of Scotland, our plans for public reform and preparing us all for the jobs of the future.

The reaching 100 per cent (R100) programme will see £600 million of public funding invested over the four financial years to March 2022 to help create a future-proofed, truly national fibre network – a vital first step towards achieving the commitment. An initial procurement will formally begin this month and is expected to take around a year.

Broadband activity will continue on the ground during 2018-19, through continued deployment of the Digital Scotland Superfast Broadband ( DSSB) programme. This will be funded through a contractual mechanism (Gainshare), where new investment has been generated by early take-up on the fibre network. Gainshare will see new deployment in every local authority area across Scotland during 2018, avoiding any significant gap between DSSB and R100 deployment. We will ensure in partnership with key service providers, that in addition to the improvements in digital infrastructure, that rural businesses are also aware of and are able to access existing provisions to acquire the skills on broadband IT that they need.

In 2018-19 we will:

• deliver the final phase of the Digital Scotland Superfast Broadband ( DSSB) programme, which will extend fibre broadband access to at least 95 per cent of premises across Scotland;
• launch the first phase of our Reaching 100 per cent programme, which will deliver our commitment to extend superfast broadband access to all of Scotland by 2021; and
• deliver the initial stages of a programme, developed and delivered in conjunction with the four UK operators, to address gaps in 4G mobile coverage, a key element in our World Class Digital Infrastructure Programme.

Transport Priorities

Transport provides vital links between urban, rural and remote communities, enabling them all to thrive, and plays a pivotal role in realising the vision of a prosperous, sustainable and inclusive economy. The budget will continue to enable the provision of vital services as well as focusing investment on our strategic aims.

Sustainable Transport

At the heart of our transport strategy is a commitment to a sustainable transport system. One which lowers Scotland’s carbon footprint, improves air quality, and positions us to take advantage of the economic, as well as the environmental benefits, of innovation in this area.

In 2018-19 we will:

• double our investment to £80 million in a range of measures to support the Programme for Government ambitions to build an Active Nation. We will create safe segregated walking and cycling infrastructure in towns and cities across Scotland to make our towns and cities friendlier and safer spaces for pedestrians and cyclists;
• support behaviour change activities to promote active travel in all Scottish local authorities and work across the Scottish Government to build an active nation;
• work towards the target to phase out the need for new petrol and diesel cars and vans by 2032 by a significant expansion of electric vehicle ( EV) charging infrastructure across Scotland, including pilots to address complex issues such as tenement areas;
• operate and invest in charging infrastructure to create the ‘electric A9’ and strengthen the ChargePlace Scotland EV network, including the development of charging hubs at strategic locations;
• accelerate the uptake of ultra-low emission vehicles ( ULEVs) through our Switched on Fleets programme to support the uptake of ULEVs in the public sector and the Low Carbon Transport Loan Fund, which helps individuals and businesses adopt ULEVs;
• fund large-scale pilots, incentives, and support innovation that will support a shift to more sustainable transport modes. We will support comprehensive co-ordinated action by local authorities to promote the uptake of ULEVs in their area; and
• continue to support the adoption of low emission buses, developing a new, expanded Scottish Green Bus Fund and loan scheme to support operators to work towards a transformation in the emissions performance of the Scottish bus fleet.

Motorways and Trunk Roads

In 2018-19 we will invest in major infrastructure projects, to improve Scotland’s road network. We will:

• continue to progress construction of the A737 Dalry Bypass;
• continue to progress design and development work on dualling the A9 and A96 and commence construction of the A9 Dualling Luncarty to Birnam project;
• commence construction of the A90/A96 Haudagain Junction Improvements, A77 Maybole Bypass, A737 The Den realignment and improvements on the A9 at Berriedale Braes;
• continue to progress design and development work on a range of projects including improvements to the A82 between Tarbet and Inverarnan, the grade separation of Sheriffhall Roundabout on the A720, Longman Roundabout on the A9/A82 and also at Laurencekirk on the A90;
• continue to invest in essential road maintenance schemes, our bridge strengthening programme and ancillary assets and increasing the resilience of the network to unplanned events such as flooding and high winds and reducing barriers to accessibility; and
• work with local authorities to support the introduction of the Glasgow Low Emission Zones ( LEZs) by 2018, prepare for the introduction of LEZs into three other cities by 2020, and begin the assessment of other Air Quality Management Areas for LEZ mitigation.

Railways

We will continue our significant investment in Scotland’s railways to support a safe and high-performing railway through the delivery of new and better services, new and refurbished trains, and substantial improvements to the infrastructure to increase capacity and reliability.

In 2018-19 we will:

• continue the delivery of the rolling programme of electrification, including Stirling, Dunblane and Alloa, and supporting delivery of 42-minute fastest journey time on the electrified Edinburgh to Glasgow via Falkirk High route;
• continue delivery of improvements to the route between Aberdeen and Inverness, and on the Highland Main Line between Inverness and Perth;
• continue to tackle overcrowding with 200 extra carriages to be added to the ScotRail fleet increasing it to more than 1,000 carriages and to start the roll out of new sleeper rolling stock, delivering a step change in overnight rail travel for passengers;
• introduce 26 re-furbished High Speed Trains to operate on inter-city routes, with 40 per cent more seats on those routes;
• complete the redevelopment of Dundee Station, support the redevelopments planned for Aberdeen, Inverness and Stirling stations, and continue to support the delivery of new stations at Robroyston and Kintore; and
• continue our work to identify a suitable body to make a robust bid for a future rail franchise and take initial steps to ensure that the body is in a position to make such a bid.

Bus Services

In 2018-19 we will:

• continue to provide concessionary travel for older and disabled people and to engage with stakeholders on how best to ensure we continue to deliver free bus travel to those who need it most;
• work in partnership with others to develop a pilot scheme of free bus travel for young modern apprentices and separately consider how we might provide free bus travel to recipients of the proposed new Job Grant when that is introduced;
• continue to support bus services and the use of greener, less-polluting vehicles; and
• continue to ensure Scotland’s electronic ticketing systems are maintained to the appropriate standard required to deliver concessionary travel and developed to allow commercial smart ticketing, upgrading systems and infrastructure in line with technological advancements.

Air Services

In 2018-19 we will:

• ensure that Highlands and Islands Airports Ltd ( HIAL) has the necessary resources to maintain its 11 airports at current levels of operational ability;
• continue to fund the Air Discount Scheme and the lifeline air services to Barra, Campbeltown and Tiree;
• continue to support the re-positioning of Prestwick Airport; and
• continue to support Route Development opportunities.

Ferry Services

In 2018-19 we will:

• continue to support ferry services on the Clyde and Hebrides, Gourock to Dunoon and Northern Isles routes;
• protect the Road Equivalent Tariff ( RET) on Clyde and Hebrides Ferry Services routes, and implement the Manifesto commitment to reduce passenger and car fares on ferry services to Orkney and Shetland;
• continue to support construction of two new major dual-fuel vessels for the Clyde and Hebrides network and develop proposals to procure further planned replacement vessels;
• secure the long-term future of the vessels on the Northern Isles routes; and
• provide grant support for priority harbour projects on the Clyde and Hebrides network.

Other Transport Policy, Projects and Agency Administration

In 2018-19 we will:

• support the Scottish Disability Equality Forum to develop and host an accessible travel hub and engage with disabled people in line with our Accessible Travel Framework;
• continue to support the maintenance and operation of Scottish Canals;
• continue to fund Traveline and other transport information provision and the running of Transport Scotland;
• promote measures to transfer freight from road;
• continue to support Regional Transport Partnerships and the Scottish Road Works Commissioner;
• continue our collaborative review of the National Transport Strategy to produce a successor Strategy;
• undertake research, analysis and stakeholder engagement to inform strategic transport initiatives; and
• continue to support Scotland’s Road Safety framework through Road Safety Scotland and the completion of the Edinburgh Tram Inquiry.

Highlands and Islands Enterprise Priorities

We will continue to work in partnership with communities and business, investing in our economic and social infrastructure, supporting jobs and improving connectivity. The budget supports Highlands and Islands Enterprise ( HIE) to develop growth sectors, improve competitiveness, productivity and support fair work, attract new investment, and work with the financial sector to improve access to finance.

In 2018-19 we will:

• work with our enterprise agencies and others to create the right conditions to support sustainable and inclusive economic growth;
• work with our enterprise agencies to create a competitive and low carbon economy;
• continue to focus efforts on Innovation, Investment, Internationalisation and Inclusive Growth;
• continue to support growth sectors, growth companies and growth markets; through our enterprise bodies and economic development networks; and
• continue to strengthen local communities, particularly in some of Scotland’s most fragile areas.

Spending Plans

Table 12.01: Rural Economy and Connectivity Spending Plans (Level 2)

Level 2	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
EU Support and Related Services	178.8	177.6	178.4
Rural Services	35.8	42.4	32.3
Fisheries and Aquaculture Grants	7.4	6.4	5.9
Forestry Commission	61.3	61.3	63.7
Digital Connectivity	116.0	136.0	59.4
Highlands and Islands Enterprise	67.5	67.0	71.7
Air Services	60.3	59.3	59.8
Concessionary Fares & Bus Services	261.3	254.4	269.1
Ferry Services	198.6	181.0	240.5
Motorways & Trunk Roads	820.3	967.0	831.5
Other Transport Policy, Projects and Agency Administration	117.7	138.4	185.3
Rail Services	751.3	775.8	808.8
Total Level 2	2,676.3	2,866.6	2,806.4
of which:
Fiscal Resource	1,230.9	1,322.5	1,246.7
Non-cash	150.7	136.3	200.3
Capital	1,282.7	1,397.8	1,322.4
Financial Transactions	12.0	10.0	37.0
AME	-	-	-
Central Government Grants to Local Authorities	21.9	27.5	26.4

Table 12.02: Rural Economy and Connectivity Spending Plans (Level 2 real terms) at
2017-18 prices

Level 2	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
EU Support and Related Services	181.5	177.6	175.8
Rural Services	36.3	42.4	31.8
Fisheries and Aquaculture Grants	7.5	6.4	5.8
Forestry Commission	62.2	61.3	62.8
Digital Connectivity	117.8	136.0	58.5
Highlands and Islands Enterprise	68.5	67.0	70.7
Air Services	61.2	59.3	58.9
Concessionary Fares & Bus Services	265.3	254.4	265.2
Ferry Services	201.6	181.0	237.0
Motorways & Trunk Roads	832.8	967.0	819.4
Other Transport Policy, Projects and Agency Administration	119.5	138.4	182.6
Rail Services	762.7	775.8	797.0
Total Level 2	2,717.1	2,866.6	2,765.5
of which:
Fiscal Resource	1,249.6	1,322.5	1,228.5
Non-cash	153.0	136.3	197.4
Capital	1,302.2	1,397.8	1,303.1
Financial Transactions	12.2	10.0	36.5
AME	-	-	-
Central Government Grants to Local Authorities	22.2	27.5	26.4

Table 12.03: EU Support and Related Services (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Pillar 1 – Basic Payments	262.0	262.0	262.0
Pillar 1 – Greening payments	131.5	131.5	131.5
Other Pillar 1 payments	44.5	44.5	44.5
Business Development	31.2	30.2	27.8
Less Favoured Area Support Scheme	65.0	65.5	65.5
Agri Environmental Measures	46.8	55.1	46.4
Forestry	1.6	1.4	1.0
Rural Enterprise	0.1	-	-
Rural Communities	0.1	-	-
Leader	4.5	10.1	22.9
Technical Assistance	5.0	0.7	0.6
Broadband	3.6	6.4	7.0
Crofting Assistance	0.3	0.3	(0.2)
Payments and Inspections Admin	55.6	62.9	82.0
CAP Compliance Improvements	26.2	42.2	31.0
Less EU Income	(499.2)	(535.2)	(543.6)
Total	178.8	177.6	178.4
of which:
Fiscal Resource	119.3	103.5	102.7
Non-cash	18.2	18.2	32.5
Capital	36.3	50.9	38.2
Financial Transactions	5.0	5.0	5.0

What the EU Related Support and Related Services budget does

The EU support and related services budget supports and protects primary productivity in the agricultural and wider rural sector through the delivery of EU funding (European Agricultural Guarantee Fund) under direct support measures. The Scottish Rural Development Programme ( SRDP) provides for National and EU funding (European Agriculture Fund for Rural Development) to support measures which deliver economic, environmental and community benefit for rural Scotland.

The delivery is underpinned by the provision of regulatory inspection functions, scientific and technical advice, monitoring and evaluation as well as new improved business processes and associated IT functionality.

Table 12.04: Rural Services Spending Plans (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Crofting Commission	2.6	2.5	2.9
Rural Cohesion	1.2	1.0	0.6
Agricultural and Horticultural Advice and Support	3.6	9.5	4.4
Veterinary Surveillance	5.2	5.2	4.2
Animal Health	18.2	18.2	15.2
Food Industry Support	5.0	6.0	5.0
Total	35.8	42.4	32.3
of which:
Fiscal Resource	35.0	40.8	32.2
Non-cash	-	-	0.1
Capital	0.8	1.6	-

What the Rural Services budget does

The rural services budget directly supports sustainable rural development through funding measures which deliver economic, environmental and community benefit for rural Scotland; providing direct support to farming, forestry, crofting and rural development projects. It also contributes to the delivery of reducing greenhouse gas emissions.

Table 12.05: Fisheries and Aquaculture Grants Spending Plans (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Fisheries Grants	15.2	14.2	14.1
Fisheries Harbour Grants	0.4	0.4	0.4
Less Retained Income/Capital receipts	(8.2)	(8.2)	(8.6)
Total	7.4	6.4	5.9
of which:
Fiscal Resource	2.0	2.0	1.5
Non-cash	-	-	-
Capital	5.4	4.4	4.4

What the Fisheries and Aquaculture Grants budget does

The Fisheries and Aquaculture budget supports the sustainable use of the marine environment by providing the domestic funding contribution towards the European Maritime and Fisheries Fund. The budget also provides funding towards harbour repairs caused by storm damage.

Table 12.06: Forestry Commission Spending Plans (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Programme Costs	18.5	16.0	14.8
Subsidy to Forest Enterprise	21.7	20.7	19.7
Depreciation	0.1	0.1	0.1
Policy Regulation & Administration	4.8	4.3	3.9
Woodland Grants	36.0	40.0	46.0
EC Receipts	(19.8)	(19.8)	(20.8)
Total	61.3	61.3	63.7
of which:
Fiscal Resource	59.6	59.6	62.0
Non-cash	0.1	0.1	0.1
Capital	1.6	1.6	1.6

What the Forestry Commission budget does

The budget will protect and enhance existing woodland resources, including Scotland’s national forest estate, maximising their contribution to the economy and carbon emission reduction targets with a focus on delivering the Scottish Government’s woodland creation target and other Programme for Government priorities.

Table 12.07: Digital Connectivity (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Digital Strategy Capital	92.2	112.1	34.2
Digital Strategy	23.8	23.9	25.2
Total	116.0	136.0	59.4
of which:
Fiscal Resource	23.8	23.9	25.2
Capital	92.2	112.1	22.2
Financial Transactions	-	-	12.0

What the Digital Strategy budget does

This budget supports activity to extend digital connectivity, support the development of digital skills, boost the wider digital economy, get more public services online, encourage digital participation and improve cyber resilience. It also supports the procurement of data and specific technical assistance to strengthen understanding of key development in the economy and public finances.

Table 12.08: Highlands and Islands Enterprise (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Highland and Islands Enterprise	67.5	67.0	71.7
Total	67.5	67.0	71.7
of which:
Fiscal Resource	30.3	29.8	30.5
Non-cash	11.0	11.0	15.0
Capital	26.2	26.2	26.2

What the Highlands and Islands Enterprise budget does

The budget funds Highlands and Islands Enterprise ( HIE), the main economic development body operating in the Highlands and Islands, in some of the most remote and fragile areas of Scotland. In addition to HIE activities this budget supports other activities in the Highlands and Islands area and the Convention of Highlands and Islands.

Table 12.09: Air Services (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Highlands and Islands Airports Limited	39.0	35.1	36.5
Prestwick Airport	9.3	9.4	6.5
Support for Air Services	12.0	14.8	16.8
Total	60.3	59.3	59.8
of which:
Fiscal Resource	30.9	33.4	34.0
Non-cash	9.5	9.5	9.5
Capital	19.9	16.4	16.3

What the Air Services budget does

The budget supports Highlands and Islands Airports Limited ( HIAL) and Prestwick Airport. It includes resources for capital investment and operation and development of airport services.

It also supports the Air Discount Scheme which provides discounted fares for eligible residents on eligible routes, the provision of lifeline air services from Glasgow to Campbeltown, Tiree and Barra which cannot be provided commercially and international route development.

Table 12.10: Concessionary Fares and Bus Services (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Smartcard Programme	2.8	1.9	3.3
Concessionary Fares	207.8	198.3	201.6
Support for Bus Services	50.7	54.2	64.2
Total	261.3	254.4	269.1
of which:
Fiscal Resource	259.3	252.4	257.1
Non-cash	-	-	-
Capital	2.0	2.0	2.0
Financial Transactions	-	-	10.0

What the Concessionary Fares and Bus Services budget does

The budget provides support for bus services across Scotland, primarily through Bus Service Operators’ Grant ( BSOG), and funds national concessionary travel schemes for older, disabled and young people and the smartcards used to access concessionary travel. BSOG is paid to bus operators based on mileage. The budget also provides loan funding to support operators to transform emissions performance.

This budget also provides funding for a number of organisations working to improve public transport, including Bus Users Scotland and the Community Transport Association Scotland.

Table 12.11: Ferry Services (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Support for Ferry Services	153.4	165.8	173.7
Vessels and Piers	45.2	15.2	66.8
Total	198.6	181.0	240.5
of which:
Fiscal Resource	153.4	165.8	173.7
Non-cash	-	-	-
Capital	45.2	15.2	66.8

What the Ferry Services budget does

The budget supports the ‘Scottish Government’s Ferries Plan’, published in December 2012 and provides subsidy for the:

• Clyde and Hebrides Ferry Services ( CHFS) contract;
• Northern Isles Ferry Services contract; and
• Gourock-Dunoon Ferry Service contract.

It also provides for loans to Caledonian Maritime Assets Ltd for vessels used on these networks and grants to ports for improvement works to piers and harbours that support lifeline ferry services.

Table 12.12: Motorways and Trunk Roads (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Structural Repairs	27.4	27.9	34.0
Network Strengthening	40.8	56.0	57.8
Private Finance Payments	98.0	141.6	172.3
Routine and Winter Maintenance	80.6	85.1	89.9
Other Current Expenditure	10.0	10.0	13.6
Roads Improvement	16.3	16.3	39.2
Capital Land and Works	285.5	425.6	249.0
Forth Replacement Crossing	134.1	77.0	7.2
Roads Depreciation	111.3	96.9	142.5
Forth and Tay Road Bridge Maintenance	16.3	30.6	26.0
Total	820.3	967.0	831.5
of which:
Fiscal Resource	195.4	243.5	282.6
Non-cash	111.3	96.9	142.5
Capital	513.6	626.6	406.4

What the Motorways and Trunk Roads budget does

In addition to major roads construction projects and other road improvements, the budget delivers routine, cyclical and winter maintenance to maintain the safety, environment and amenity of the trunk road network. It includes road safety improvement programmes, information for road travellers and an emergency response facility to deal with emergencies and incidents on the network.

Table 12.13: Other Transport Policy, Projects and Agency Administration (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Transport Information	1.2	1.2	1.2
Agency Administration Costs	17.8	17.4	17.4
Strategic Transport Projects Review	1.0	3.6	5.2
Support for Freight Industry	0.8	1.3	1.0
Scottish Canals	10.0	11.1	11.6
Support for Sustainable and Active Travel	35.9	33.9	79.0
Future Transport Fund	20.2	25.3	60.2
Travel Strategy and Innovation	25.3	40.1	5.3
Road Safety	3.0	3.0	2.9
Edinburgh Tram Inquiry	2.5	1.5	1.5
Total	117.7	138.4	185.3
of which:
Fiscal Resource	54.0	54.1	55.6
Non-cash	0.6	0.6	0.6
Capital	56.1	78.7	119.1
Financial Transactions	7.0	5.0	10.0

What the Other Transport Policy, Projects and Agency Administration budget does

The budget provides support for sustainable transport; the provision of impartial travel information services; road safety; accessible travel; freight industry reduction of emissions; contributing to Future Transport Fund initiatives.

The budget also supports Scottish Canals to operate, repair and maintain the canal network and the running of Transport Scotland.

Table 12.14: Rail Services (Level 3)

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Rail Franchise	265.9	310.7	183.4
Rail Infrastructure	463.3	426.5	587.6
Rail Development	2.0	3.0	6.2
Major Public Transport Projects	20.1	35.6	31.6
Total	751.3	775.8	808.8
of which:
Fiscal Resource	267.9	313.7	189.6
Non-cash	-	-	-
Capital	483.4	462.1	619.2

What the Rail Services budget does

The budget supports the delivery of passenger rail services through the ScotRail and Caledonian Sleeper franchise contracts, including procurement of new trains, and Network Rail’s operation, maintenance, enhancement and renewal of the rail infrastructure in Scotland.

Rail infrastructure funding comprises the grant paid to Network Rail and track and station access charges payable by the franchise operators. This funding is determined independently by the Office of Rail and Road ( ORR) with the allocation between grant and operator varying between years.

Table 12.15: Central Government Grants to Local Authorities

Level 3	2016-17 Budget £m	2017-18 Budget £m	2018-19 Draft Budget £m
Regional Transport Partnerships	16.0	20.1	19.0
Cycling, Walking and Safer Routes	5.9	7.4	7.4
Total	21.9	27.5	26.4
of which:
Fiscal Resource	-	-	-
Non-cash	-	-	-
Capital	21.9	27.5	26.4