Image source, bbc

The Scottish government has admitted it did not follow the correct procedures while investigating sexual harassment claims against Alex Salmond.

Allegations against the former first minister, which he denies, were made to the Scottish government a year ago.

The government has now admitted it breached its own guidelines by appointing an investigating officer who had "prior involvement" in the case.

As a result, it has admitted defeat in its legal battle with Mr Salmond.

Read more here.

A memorandum of understanding, aimed at repurposing Dundee's Michelin factory when it closes in 2020, has been signed.

The Michelin-Scotland Alliance will see the tyre manufacturer work with Scottish Enterprise, Dundee City Council and "other strategic partners".

Michelin told the factory's workers in November that it intended to close the plant with the loss of all 845 jobs.

The alliance aims to develop a manufacturing, remanufacturing, recycling. and low carbon transport hub.

Image source, Alan Richardson

SNP MSP John Mason asks for an update on Michelin in Dundee.

Economy Secretary Derek Mackay explains companies can get into difficulty and there are sometimes opportunities for ministerial involvement, like in the case of Michelin.

Mr Mackay says Michelin have been quite an ethical company which has led to the Michelin Scotland Alliance.

The minister says this has led to the potential to repurpose the plant, and a proposition around retraining and reskilling to be housed at Dundee.

The plans to withdraw tyre manufacturing have been confirmed with full redundancy payments, he explains, but says Michelin have appointed a senior consultant to help with retraining.

Labour MSP Jackie Baillie says: "It feels like the Scottish government has been sleepwalking, and trusting Kaiam" resulting in the workforce not being paid before Christmas.

Ms Baillie asks if there have been any discussions with the chief executive of Kaiam, when he was in place.

The minister replies no, but says he is in discussions with KPMG, the administrators.

He insists there was, however, engagement between the Scottish government and the company.

Mr Hepburn goes on to insist he did not mislead the committee about the position of Kaiam last year, under pressure from Ms Baillie.

SNP MSP Angela Constance says she has spent much of the last two weeks with regard to the devastating news the workers at Kaiam recieved before Christmas.

Ms Constance, the MSP for Almond Valley, says the purpose of the tax payers money, £850,000 in 2014, given to expand the business at Kaiam was to establish 103 new jobs and safeguard existing jobs, but the company did the exact opposite.

Business, Fair Work, and Skills Minister Jamie Hepburn stresses his first priority is to support the workforce who have been made redundant, and says he will have to engage with Scottish Enterprise about this as they have responsibility for that.

Mr Hepburn says the issue of claw backs could arise, which would be done through the administrator.

Ms Constance asks if it would be possible to get the Scottish Enterprise cash invested in Kaiam in 2014 back. It was to safeguard jobs, but the firm then sacked workers that same year.

Mr Hepburn goes on to say work goes on with the administrator to see if there could be a buyer for the site.

Labour MSP Jackie Baillie also presses the minister on the issue of claw back, to which the minister reiterates the expectation is that there will be some.

Douglas Fraser
Scotland business & economy editor

In his previous budget, Derek Mackay was radical. The SNP's finance secretary tore up the income tax system to create a new one for Scotland, and set course for divergence from the Westminster line by dipping into higher earners' pockets.

At the same time, the Scottish Fiscal Commission delivered its first forecast for the Scottish economy, with an extremely gloomy 0.7% annual growth rate. That forecast matters because it's the one Derek Mackay has to use for his budgeting.

In this year's budget, the most notable tax measure was NOT to do something - not to change the threshold for paying the higher rate, sticking with those on at least £43,430.

Image source, PA

This time, it's Phillip Hammond at Westminster who is being the fiscal radical - tearing up the Treasury orthodoxy of deficit reduction since 2010, and splurging extra cash on the health service.

As for growth, the Fiscal Commission has raised its hopes for the economy. This year looks like 1.4%, and next year 1.2%, followed in 1% in 2020 and still only 1.2% in 2023.

That's a big improvement on last year's forecast, but it's a long way from strong growth, and it remains subdued in later years.

It's closer to other forecasts, including the Fraser of Allander Institute this week. Last week, it was the EY Item Club of Scottish economists, which was issuing a similar middle-term warning. It said this year's growth has picked up a bit. It's been stronger than the UK, but there are factors weighing on future growth, including weak productivity and demographic shifts.

Scotland's finance secretary has said he will not pass on a tax break for higher earners that was announced by the chancellor in his UK budget.

Derek Mackay said "now is not the time" to cut taxes for higher rate tax payers as he unveiled his Scottish budget, external.

It means the gap between how much higher earners in Scotland pay has widened compared to the rest of the UK.

But Mr Mackay said most people would continue to pay less in Scotland than south of the border.

He also pledged extra funding for education, the health service, local government, and infrastructure as he set out his plans for tax and spending for the next year at Holyrood.

The Conservatives claimed that higher earners were "being punished in the SNP's Scotland," with people earning £50,000 in Scotland paying about £1,500 more a year than their counterparts south of the border.

• Richer or poorer? Ask the budget calculator
• Scottish budget: At a glance
• Douglas Fraser analysis: 'Small change'
• How does tax compare with the rest of the UK?

Tory MSP Dean Lockhart pivots to income tax.

Mr Mackay says his government's policies will actually increase the income tax take.

Mr Lockhart presses the minister as to whether the income tax take will actually decrease by £500,000.

The minister points out that we are moving from forecast to actual outturn, which explains the disparity.

Mr Lockhart asks if increasing the tax gap will help income tax revenue, to which Mr Mackay replies he sees no evidence people are being deterred from moving to Scotland.

Mr Mackay accepts elements of European funding have not landed as hoped.

The economy secretary says some investment plans are being put on hold due to the "calamitous position we are now in" due to Brexit, and the "ineptitude of the UK government".

Labour MSP Jackie Baillie says there were people who wanted to invest in the last 12 months in preparation for Brexit and this has been a "mixed opportunity".

Will the minister ensure the European funding is used, she asks.

Mr Mackay insists it will be used elsewhere to support the economy.

Economy Secretary Derek Mackay says he is sure the chief executive of Scottish Enterprise, Steve Dunlop, would be willing to detail how the organisation will operate within its budget.

There is an annual expectation efficiencies will be made, Mr Mackay explains.

Green MSP Andy Wightman says it is difficult to know year to year what efficiencies will be needed.

Mr Mackay replies there is shared good practice in the Scottish Leader's Forum of the best way to achieve efficiencies.

Mr Wightman asks what evidence there is that the Small Business Bonus scheme provides any economic benefits.

Mr Mackay says he is happy to supply survey evidence of the benefit.

Image source, KAIAM

On 26 December 2018 we reported that an appeal to help computer factory workers who lost their jobs just before Christmas had doubled its target after a surge in donations.

Fundraisers initially hoped to raise £10,000 for staff at the Kaiam factory in West Lothian.

But by Boxing Day the crowdfunding total had topped £17,500. A new target of £20,000 was then set.

More than 300 workers at the plant in Livingston were made redundant without being paid wages.

They will have to claim their wages through the Insolvency Service.

• Livingston computer factory lays off 310 workers
• Administrators appointed at computer firm
• Uncertain future as workers' wages go unpaid
• Read more here

Mr Lindhurst raises the issue of Kaiam in Livingston, which has received government support, and asks if this could have been dealt with more efficiently.

Business, Fair Work, and Skills Minister Jamie Hepburn says: "Clearly the situation at Kaiam is a very disappointing one."

Scottish Enterprise must go through due diligence in deciding its allocation of funding, explains the minister.

Finance, Economy, and Fair Work Secretary Derek Mackay tells the committee the Scottish economy has continued to see stable growth for the fifth consecutive quarter.

Mr Mackay points to the economic growth plan published last October, and cites the £5bn investment into Scotland's infrastructure detailed in his budget.

Committee convener Gordon Lindhurst asks why the Scottish Enterprise grant allocation is being reduced.

The economy secretary points out Scottish Enterprise can generate some of its own income and the government has to make choices.

He argues Scottish Enterprise can deliver the efficiencies required and reach its targets.