Just Transition Commission Interim Report

1. Introduction

1.1 The Just Transition Commission was established by Scottish Ministers to advise on how just transition principles can be applied to climate change action in Scotland. Our remit is to prepare practical recommendations within two years of our first meeting, meaning our final report is due to be shared with Ministers by January 2021. We have been asked for recommendations that will help support action to:

• maximise the economic and social opportunities that the move to a net-zero economy by 2045 offers
• build on Scotland’s existing strengths and assets
• understand and mitigate risks that could arise in relation to regional cohesion, equalities, poverty (including fuel poverty), and a sustainable and inclusive labour market

1.2 This report has been prepared as a result of a request from the Cabinet Secretary for Environment, Climate Change, and Land Reform asking for interim advice to inform the updated Climate Change Plan. We hope this document can be helpful in this regard.

1.3 We held our inception meeting at the start of last year, when we agreed a work plan and an approach to collecting evidence. Since that initial meeting, we have travelled the country speaking to a range of stakeholders regarding the challenges and opportunities of transitioning to a net-zero economy. This has included a variety of activities, such as consideration of written evidence, discussions with experts, engagement events and site visits.

1.4 While we have been carrying out this programme of work, we are very aware that public concern over the impact and response to climate change has never been higher. There have also been important changes on the policy front. With this in mind, there are a number of developments that we can point to as being broadly positive in terms of delivering a just transition to a net-zero economy in Scotland.

1.5 For example, the new Climate Change (Emission Reduction Targets) (Scotland) Act has increased the level of ambition and provides a building block for action across the economy. While the headline target of net-zero emissions by 2045 captured most attention, we were pleased to see the inclusion of a set of just transition principles in the final Act.^[2] Other key pieces of legislation, such as the Scottish National Investment Bank Bill recently passed by Parliament, were amended to include reference to just transition principles.^[3] We were pleased to see this development following discussions and correspondence we had shared with the officials leading the legislation.

1.6 We have also been pleased by the productive engagement we’ve had to date with similar groups set up by Government, namely the Fair Work Convention and the Infrastructure Commission. The willingness by these groups to engage around climate change and just transition has been encouraging. The advice and recommendations we submit to Government can build on the work of these respective groups. The recent ‘Key Findings’ report from the Infrastructure Commission in particular was encouraging, with its call for Scottish Government funded investments to be prioritised against inclusive, net-zero economy outcomes.^[4]

1.7 Alongside this, climate change was a central focus of the Scottish Government’s Programme for Government in September. This document outlined a number of new initiatives and funding to help contribute towards meeting the new net-zero target. The commitment to develop a Green New Deal for Scotland, in particular, is relevant to the work of the Commission. Like the emerging proposals for the European Green Investment Deal,^[5] we hope this will have delivering a just transition as a central component.

1.8 This legislation and new action mentioned here will not be sufficient on their own to secure a just transition for Scottish workers and communities. But they do represent promising action being taken by Government that can be built upon. We hope our advice can help Government think through how a just transition can be delivered in Scotland.

1.9 The scale of the challenge cannot be underestimated. The last year has seen continued debate regarding lost opportunities for manufacturing employment related to decarbonisation in Scotland. In recent months we have seen the loss of jobs at several yards involved in the supply chain for renewable energy developments. While action is being taken in collaboration with trade unions and other stakeholders to try and secure future opportunities, the experience of renewable energy should serve as a reminder that we have not managed to maximise the opportunities of decarbonisation, to date.^[6] If lessons are not learned then other promising opportunities for Scotland risk either being lost or not maximised to their fullest potential.

1.10 We will provide formal recommendations to Government in our final report in early 2021. In this interim report we have identified some key areas that we believe merit action from Government now. We feel this is important as urgent action is needed if Scotland is to meet its climate change targets, and that action is unlikely to be sustainable if it is not delivered in a way that is fair. Investments and other policy decisions made today will have long-term impacts, including the potential to lock-in emissions, unfairness and a lack of economic and social justice. Government must ensure decisions taken in the year ahead are compatible with its ambitions on just transition and not wait for the final advice of this Commission.

1.11 There is a real opportunity for Scottish Government to demonstrate leadership. With COP 26 being held in Glasgow later this year, the attention given to Scotland’s approach to tackling climate change will be greater than it has ever been. Scotland will have the chance to demonstrate itself to be a world-leader in this area. However, to achieve this we will need to move beyond the rhetoric of just transition and begin the hard work of policy development and implementation. The need for immediate action is clear, and we hope this report can act as a rallying call to help drive this agenda forward in the year ahead.