Second defeat for Scots government over enterprise plans

MSPs backed the Conservative motion by 63 votes to 62

MSPs have voted to demand the Scottish Funding Council retain its own board, handing the government a second defeat over its enterprise and skills review.

Ministers want a new management body to oversee all of Scotland's enterprise and skills agencies, but opposition members want individual boards to stay.

Holyrood previously voted to "reverse" the plans as they relate to Highlands and Islands Enterprise.

The government has pledged to set out its intentions in the coming weeks.

The ongoing enterprise and skills review would see a new Scotland-wide statutory board to co-ordinate the activities of Scottish Enterprise, Highlands and Islands Enterprise (HIE), Skills Development Scotland and the Scottish Funding Council (SFC).

A governance report by HIE chairman Lorne Crerar has suggested the individual groups could retain "delivery boards" within the new structure. However, opposition groups argue even this would be unacceptable centralisation, with claims it could be the "death knell" for the individual boards.

Economy Secretary Keith Brown has pledged to return to the chamber with a ministerial statement in the coming weeks.

Liz Smith said the government was "completely carried away" over the plans

Conservative MSP Liz Smith put forward a motion backing the "key role and legal status of the current Scottish Funding Council board", which helps allocate funding to Scottish colleges and universities.

The motion says the board should "retain its important functions", noting that it "must not just be a 'delivery board' but also have the powers to act on its own initiative and to challenge government".

Ms Smith said ministers have been "completely carried away with theory" without thinking about the practical implications of their proposals.

She added: "It is not at all clear why in order to have better strategic alignment you need to unpick the governance structures of all four agencies.

"There was a complete absence of evidence from phase one which supports the Scottish government's intention and now there is real concern about where on earth the Scottish government is going."

Shirley-Anne Somerville said the government would be "going forward in listening mode"

Further Education Minister Shirley-Anne Somerville put forward an amendment to replace the entire motion, defending the government's plans.

However, she said the government would be "going forward in listening mode" until Mr Brown's statement.

She said: "We will maintain a national strategic body which allocates funding independently of ministers to our colleges and universities and for research.

"This reform can help put Scotland among the top-performing OECD nations and I will work with MSPs from across the chamber and stakeholders beyond to achieve that goal."

Other opposition parties were critical of the plans, which several referred to as the creation of a "super board", and backed the Conservative motion.

Labour's Iain Gray said: "This is a fundamentally flawed proposal, and the government should think again."

Ross Greer said the Scottish Greens were "not prepared at this point to support" an enterprise "super board", while Lib Dem Tavish Scott said the SNP was "hell-bent on concentrating powers into their own hands".

Following the debate, Ms Somerville's amendment was defeated by 63 votes to 62, before Ms Smith's motion was passed by the same margin.