March 2008
Minutes Of Scottish Enterprise Board: 28 March 2008
Present
Sir John Ward CBE, Chairman
Jack Perry, Chief Executive
Pat Denzler
Fred Hallsworth
Charlie Morrison
Donald MacRae
Colin McClatchie
Ray Perman
Barbara Duffner OBE
Sir Timothy O’Shea
Douglas Lamb
LEC Chairs
Charles Hammond, SE Edinburgh and Lothian
Apologies
Vic Emery, SE Glasgow
In Attendance
Roger McClure, Scottish Funding Council
Hugh Hall, Chief Financial Officer
Paul Lewis, MD Industries
John Phillips, Senior Director, People and Organisational Development
Julian Taylor, Research & Policy
Lena Wilson, Chief Operating Officer
Brian Jamieson, SE Secretary
Imelda Molloy, Corporate Office
1. Minutes Of Board Meeting held on 29 February 2008
The minutes of the previous meetings and the outstanding action points were approved, subject to the addition at “ITI Scotland Update” – “Once the ITI Scotland review had been completed and considered by the Investment Committee, the Board wished to evaluate ITI Scotland in the context of all the initiatives supporting High Growth Business starts and the Business Growth pipeline.”
2. Chairman’s Report
The Chairman noted that Roger McClure’s retirement had been announced and that the next meeting would be his last. Appreciation was recorded on behalf of the Board for his input and co-operation.
Interviews for new Board members would continue into April with appointments being made by end –April.
The Chairman had written to all LEC Board members thanking them for their involvement. Particular thanks were recorded to the LEC Chairmen, past and present, who had served as attendees at the SE Board.
3. Chief Executive’s Report
The Board was given an update on Stirling Medical Innovation’s Project.
On transition issues, the transfer to Skills Development Scotland (SDS) was now set to take place on 1 April. SDS had recognised the effort involved by SE staff in meeting this target. Negotiations continued on the precise scope of the regeneration transfer. Although the Business Gateway transfer was in agreed terms for 1 April, COSLA were coupling this to agreement on regeneration.
A Leadership Conference had been held with the new senior staff team which had displayed a positive attitude.
A joint event with CBI at Dover House had brought together Scottish MPs and Peers and Scottish businesses.
The Minister had attended the latest round of Proof of Concept awards and had held a question and answer session on Innovation and Commercialisation.
The Chief Executive would visit the USA the following week with the Minister.
4. Unlocking additional value from Edinburgh Bioquarter Proposition –SE (08)35
Linda McPherson, Stephen Gallagher and Margaret MacDonald joined the meeting for this item.
(Sir Tim O’Shea left the meeting due to a potential conflict of interest as the Principal of the University of Edinburgh)
Stephen Gallagher set the context for the proposal by recapping on the actions taken to date. Two major conditions, one relating to planning and one to title burdens were being addressed to facilitate a finalised deal with Alexandria Real Estate (ARE). This proposal addressed the latter issue. A number of suspensive conditions remain but a site start by ARE is anticipated by late 2008.
Margaret MacDonald explained the five elements of the project as set out in the paper.
Hugh Hall asked for flexibility in profiling the spend and it was agreed that the first instalment could be increased to £7 million, leaving the total consideration unchanged.
The paper was approved. The Board asked to see clear milestones for exits by SE and stressed the importance of formally registering dependencies on transport links to the site. It was noted that this might best be addressed at the Bioquarter Partner’s forum chaired by the Cabinet Secretary where all the relevant interests were represented.
(Sir Tim O’Shea re-joined the Meeting)
5. Items For Discussion
Finance and Performance: Period 11 Review 07/08 – Se (08)36
Iain Scott joined the meeting for this item.
It was still anticipated that all nine Priority Performance measures would be met for the full year. Confirmation was awaited on one measure.
The financial results showed slippage again in February but most was deemed recoverable. The aim remains a modest underspend. Depending on the conclusion of certain transactions not within SE’s control, the Co-Investment Fund would receive up to £40 million.
It was noted that an additional £12 million of funding had been allocated by the Scottish Government.
It was noted that in future the volume start up targets would pass to Local Authorities. It would be important to ensure that the flow of potential high growth businesses was secured.
Enterprise Networks Review: Transition Update – Se (08)37
Andrew Downie, Jane Martin and Euan Dobson joined the meeting for this item.
Hugh Hall introduced the team and advised that Ed Payne, who had been heavily involved, was now on secondment to the World Bank.
Hugh Hall outlined several of the Transition Themes.
The Business Plan had not yet been signed off by Ministers as the regeneration element was not yet settled. The latest draft plan was tabled.
The final number of staff leaving under the voluntary severance scheme was likely to be around 255 and this would be achieved with a 2 year payback. The wider redeployment pool stood around 20 at present.
Shared Services had not been addressed during this process but would now be examined.
The announcement on accommodation had now been made by the Cabinet Secretary.
Jane Martin explained the approach being taken to communications. Jane would be circulating Board members seeking their involvement in local events in the next quarter. The Chairman confirmed that Board meetings would seek to use local offices, events and meetings around the country.
It would be important to ensure that SE staff were trained to re-direct relevant enquires to SDS.
Industry Advisory Groups and Industry Engagement – Se (08)47
Paul Lewis outlined the current status of Industry Groups and updated on the creation of new or revised groups as set out in the paper.
In discussion, it was proposed:
- that although there may be two Energy groups, there should be progress towards one overarching group, with a clearly stated strategic commitment from all parties to achieve this;
- Environment Technologies may sit best within Energy;
- that Electronic Markets and Technology be re-examined to ensure that there was a convincing case for each, as opposed to a possible single Digital Technologies; and
- there was no clear articulation of Enabler Industries and the Board asked for this to come back.
Business Infrastructure Investment – Se (08)49
Stephen Gallagher outlined the position documented in the paper and the need to prioritise robustly, looking also to leverage the existing property portfolio.
Hugh Hall indicated that this remained work in progress until the finalisation of the Business Plan.
SE Investments In Public Market Companies – Se(08)48
Gerard Kelly joined the meeting for this item.
Jack Perry explained that the Board’s view was sought as there had been actual approaches which raised this policy issue.
After discussion, it was agreed that:
- there was a strong presumption against such investment as opposed to other forms of support;
- the criteria to be met by any applicant set out in the paper were appropriate, reflecting the exceptional nature of such a proposal;
- within three months, there would be an examination to see if such requests could be accommodated within existing programmes; and
- any such investment proposals would require Board approval, whether at a Board meeting or an Urgent Board Approvals Committee.
6. Committee Updates
| Performance Committee Meeting held on 27 March 2008 | Verbal update |
| Nominations Committee Meeting held on 17 March 2008 | SEB NC(M)11 |
| Remuneration Committee meeting held on 17 March 2008 | SEB RC(M)15 |
| Audit Committee meeting held on 17 March 2008 | SEAC(M)(08)01 |
Donald MacRae reported that the Performance Committee had met the previous day. The indicators comparing Scotland against OECD countries showed a sight improvement. A paper on Enterprise as one of the determinants of growth could come to the next Board Meeting.
Colin McClatchie noted that the Nominations Committee had considered the Regional Advisory Board Chairs appointments at short notice but would take time to consider the other Board appointments.
Fred Hallsworth reported that the Audit Committee had seen a line drawn under the procurement of consultants and contractors. The committee would consider further, possibly at an extra meeting, the governance of SDI.
7. Information Papers
The Board noted the following Information Papers.
| Outstanding Action Points from SE Board | SE(08)38 |
| Global, UK and Scottish Economic Commentary | SE(08)39 |
| Corporate Manslaughter | SE(08)40 |
| Monthly Update – Operations | SE(08)41 |
| Monthly Update – Industries | SE(08)42 |
| Monthly Update – International Operations | SE(08)43 |
| Approvals Within Delegated Authority | SE(08)44 |
| Complaints & Testimonials | SE(08)45 |
| Calendar of Forward Events | SE(08)46 |
SE Secretary
April 2008