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Parliamentary debates and questions

S5W-02886: Rhoda Grant (Highlands and Islands)

Scottish Labour

Date lodged: 20 September 2016

To ask the Scottish Government whether it will provide a breakdown of how the £20 million advance paid by HIE to BT that is referred to at page 10 of the August 2016 Audit Scotland Report, Superfast broadband for Scotland: A progress update, was spent; for what reason this advance was paid; whether payment of such advances is normal practice, and what (a) its position is on whether this was in line with and (b) action it took to ensure that this did not breach EU state aid rules.

Answered by: Fergus Ewing 4 October 2016

The £20 million advance payment was made to enable the delivery of the substantial subsea backhaul deployment as part of the Highlands and Islands Digital Scotland contract. Highlands and Islands Enterprise (HIE) liaised with the Scottish and UK Governments at that time to confirm that the payment was in line with relevant procurement and State Aid rules. The payment was held in a separate account by BT and the funds were drawn down following evidence of eligible expenditure. The interest earned on the funds, which totalled £606,000, was returned to HIE when the £20 million had been drawn down in full. These funds will be used to extend coverage across the region.