The Times Business Insight Scotland

Business Insight

Wednesday June 13 2012

Scaling peaksLorne Crerar’s vision for the Highlands and Islands

Forecast for growthUnique communities take up challenge to prosper in the new economy

Wednesday June 13 2012 | the times

Business Insight2

Welcome

Having the right marketing strategy, as ambitious busi-ness folk know, is critical to success. The Highlands and Islands have plenty of such strategies, all aimed at encour-

aging economic growth of one type or another. But does the region have the right one? Or might existing strategies be in conflict, cancelling each other out?

I am going to suggest that there should be a new theme which aims to bring rather different ideas together — that the Highlands and Islands are

frontier territory, where these is space to expand, where new ideas and innova-tion are eagerly welcomed, and where imaginations can not only run free, but also be realised.

Coming up with the right strategy can sometimes involve vast expense of employing highly-paid consultants. Or it can be about spotting something, even a small detail, which everybody knows but which nobody has worked out has completely unrealised potential.

This latter point was brought home in a recent chat with Paul Walsh, chief execu-tive of Diageo, which has considerable distilling interests in the region, one being Talisker, produced on the Isle of Skye.

The Talisker distillery, he said, pointing out something which I knew but would have thought was completely irrelevant, was located right next to the sea. “Made by the sea,” he said, “is resonating as a tagline. So we are doing a lot of promo-tions around that in sailing clubs, around the RNLI, around cross-Atlantic rowing — things like that which obviously resonate with the heritage of Talisker.”

Sales of Talisker are growing as a result and Talisker may well be one of the distilleries which Diageo chooses to expand in its recently announced five-year £1 billion investment programme.

Nobody, in my view, can hold a

Adopting a ‘frontier concept’ could mean a new, positive uprising as the Highlands and Islands market all their unique assets in the right way

Lift your eyes to the hills and see the futureWelcome to the June issue of Business Insight, which focuses on a unique and diverse region: the Highlands and Islands. Home to many remote and fragile communities, there is nevertheless a growing tide of optimism that the area will enjoy long-term pros-perity through the innova-tive adoption of emerging sectors such as the creative industries, life sciences and renewable energy — as well as ensuring the survival of traditional communities engaged in farming and fishing.

On these pages Peter Jones calls for a new economic revolution and Ben Thomson suggests that centralisation of resources is no solution for a region with distinctive local needs. Brian Wilson, who as a politician was especially familiar with those, believes that community ownership is at the heart of a rural economy while Professor Lorne Crerar, the chairman of Highlands and Islands Enterprise, looks to exciting times in the region as a place to work and live in.

Welcome

Peter Jonesat large

Fertile ground for a new revolution

Cover image by james glossop for the times

With all the applica-tions in for the 2012 Converge Challenge, Scottish universities and research institutes

have once again shown that they are continuing to undertake world-leading, innovative research.

This year, 50 applications were re-ceived from 14 institutions, of which 30 have been selected to progress to stage 2 of the process. Enterprise Creation Manager, Dr Olga Kozlova, who heads up Converge Challenge, said “I’m delighted with the range of applications this year. We’ve got some creative solutions to genuine real-world needs, in medicine, physics, textiles, creative industries and construction. The fi eld is wide open as to who will win this year, but whatever hap-pens, it’s going to be exciting.”

This year also saw the submission of environmentally-focused projects, further emphasizing how Converge Challenge is helping establish Scotland as a thriv-ing green economy. Proposals include developing a service to analyse the types of organisms able to benefi t and enhance oil recovery from reservoirs, and support-ing the decision making of the oil and gas industry.

However there are also clear moves to step away from our dependence on fossil fuels. One project has described the use of integrating photovoltaic (solar) cells into windows. They can be easily integrated into existing windows, and will increase the energy effi ciency of buildings, poten-

tially allowing for future generations to live in self-powered buildings, without the need for oil and gas.

Still within the environmental theme, but in a different fi eld of research, we also saw a submission which aims to trans-form the textile industry by producing sustainable, biodegradable inks for use in clothing. Due to a reduced depend-ency on oil, as synthetic inks and dyes are based on petrochemicals, the price of which fl uctuates daily. This would lead to steady prices and an environmentally friendly approach to colouring textiles, which would also require less ink and less water.

All 30 applicants have now undergone a two day residential training course, which has been led by industry experts Bill Bryan who runs the Entrepreneur Business School, and Alister Minty, chief executive of venture management company Neuehansa Ltd. Participants are taken on an educational journey which assumes no prior knowledge of setting up a business, and develops their understand-ing of marketing, fi nance, and intellectual property, to name but a few important areas of which successful entrepreneurs must have a fi rm grasp.

The highlight of the training is the Elevator Pitch, a fun evening event where all 30 participants must give a 60 second pitch of their idea to a panel of judges and invited audience, with the winner on the night walking away with pride and (probably) great relief that the experience is over. However, this event has its seri-ous side – when the fi nal six participants

are chosen in August, each will have to pitch their refi ned idea once again to a different set of judges, and it is these who chose who will ultimately walk away with the £25,000 cash prize. Pitching has been identifi ed as a key skill, and whilst many researchers are capable of describ-ing their idea on paper, they may not have experience of pitching face-to-face in one minute. Each applicant is trained in pitching over the two day course and webinar series, as well as in other vital aspects of starting and running a small business – marketing, fi nance, intellectual property to name but a few.

Over the next 8 weeks, applicants will be required to produce a full business plan, outlining exactly how they plan to create, run and make a profi t from their business. Only 10 top business plans will reach the external judging panel, which then will select top six for an investor pitch in September. It is a Dragon’s Den style experience but differently from the reality TV show, the judges’ comments are aimed to encourage and help new entrepreneurs. So come the 27th September, when the top directors, chief executives and managers of Scotland come to Heriot-Watt for the fi nal, the applicants will be well underway of becoming entrepreneurs with refi ned business propositions. And if they are able to get one minute with an investor, there’s no excuse not to perfectly pitch that idea and make an impact.

Converge Challenge – Onwards & UpwardsCOMMERCIAL REPORT: CONVERGE CHALLENGE

The Converge Challenge trophy, last year awarded

to an entrant from Strathclyde University. Who will win in 2012?

Business Insightthe times | Wednesday June 13 2012 3

This goes to the heart of what we have been promoting at Reform Scotland on local government; namely, that we should pass responsibility for providing local services such as policing back from Holyrood and health back from boards to the directly elected representatives for each area.

To overcome the excuse for not doing this being that there are too many coun-cils, we have advocated that councils in adjacent areas such as Ayrshire North, East and West should be merged, which in itself would bring the number of coun-cils down to 19. However, as Orkney and Shetland have shown, small councils can be effective at both providing efficient public services and generating economic growth if given the tools to do so.

In fact we would go further and argue that local councils should be given back their tax raising powers and more to enable them to raise the majority of what they spend. This would really engage the community in local councils and empower the politicians.

Local government used to have responsibility for council tax and business rates and we would like these returned to local government. This could mean areas like the Highlands, which has a higher number of second homes than average, could deal with the council tax second home discount differently to other areas of the country where it is less of an issue.

And if Scotland gets greater fiscal powers under Devo Plus or Independ-ence, then some of these powers should be passed on down to local government. All the arguments used for greater fiscal powers for Scotland are equally valid for local government.

To turn the tide of centralisation is not going to be easy; a bit like doing the Cuillin Ridge. One just has to keep trying and at some stage hope it will happen.Ben Thomson is an investment banker and chairman of think-tank Reform Scotland

Last month I found myself, for the third time, trying to master the challenge of walking the Cuillin Ridge, though unfortunately snow forced me yet again to give

up half way through. As I negotiated the hilltops of Skye, my mind wandered to the latest paper we were writing at Reform Scotland. The great debate on localism and why it is that over the last decade more and more power has been shifted from local government to Holyrood, the latest of which is the move towards a centralised police force responsible for local policing.

What is the reason for this centralis-ing madness? The major argument for centralisation is that it is more efficient to do things at Holyrood or in quangos than having 32 councils each running their own affairs. So local government has less and less control over the areas of responsibility it needs to provide effec-tive and co-ordinated local services.

Local policing will now be provided by Holyrood, while health is delivered through the 14 health boards and enter-prise development through six enterprise regions. It is no wonder that local government cannot provide integrated local services suited for their own local circumstances when so many different bodies have control over providing local public sector services.

As one looks out over the Highlands one can immediately see that it is very different from other parts of Scotland. The area covered by Highland council has a population of 221,630, ranking it about seventh in Scotland out of 32 councils, but covers a land mass of over 25,000 sq km – almost a third of Scotland. The authority also has a higher proportion of pensioners than average, though a lower proportion of the working population is income deprived. As a result, the issues faced are different from those in the Central Belt.

In addition the smallest three councils in Scotland, Eilean Siar (Western Isles), Orkney and Shetland, each have fewer than 30,000 residents, but in many respects these three councils have done better than many others in that at least some of the areas of responsibility of quangos match the council boundaries.

The bridge to greater local autonomy is one that should be crossed

BenThomson

came the hydro revolution in the 1950s that made possible the reliable genera-tion of electricity, making possible the provision of industries in the Highlands such as the Invergordon aluminium smelter and the wood pulp mill at Corpach, Fort William,

There was the nuclear revolution — the experimental fast breeder reactor at Dounreay, Caithness, in 1955 and which, because nuclear generation stopped in 1994, is arguably at the forefront of another technological revolution, the de-commissioning of nuclear power plants.

Then the oil revolution — the estab-lishment of offshore fabrication yards at Ardersier and (more briefly) Kishorn, pipeline manufacturing in Caithness and oil refining at Sullom Voe and Flotta.

And now there is the promise of the renewables revolution — onshore and offshore wind turbines, plus wind and wave power where Orkney and Caithness can claim to be on either side of a world technology frontier in the Pentland Firth.

Revolutions? The Highlands and Islands have had them aplenty. I reckon it is time to recast history in that light. In times of recession, or depression as some say things are now, the world needs indus-trial revolutions. Where better to kick one off than in the Highlands and Islands.

A prototype marine energy generator by OpenHydro, here being tested off Eday, Orkney, represents the renewables revolution

candle to the marketing expertise of the distillers. But when it comes to using the Highlands and its heritage as a background, some of the advertising campaigns look to be at odds with the imagery that others want to see.

The “Glen of Tranquillity” messaging used by Glenmorangie, for example, conveys the idea that the Highlands are an empty, silent place where is nothing much to do other than to sit around waiting for malt whisky to mature.

That might chime with tourist imagery portraying the Highlands as remote and empty places, full of romantic ruins which people have long since fled, leaving only passing tourists to admire vistas of ancient castles and rugged mountains.

But it doesn’t exactly fit with the picture that Highlands and Islands Enterprise wants to sell — which is of a vibrant, dynamic, modern place, full of highly educated people anxious to put their skills to work.

And that does not mesh with the image that looms big in the minds of many Scots that the Highlands and their people have been cruelly abused by the 19th century Clearances and are therefore to be regarded as helpless victims to be pitied rather than sturdy pioneers to be admired.

Using the imagery of a “frontier” concept, I would suggest, can bridge the divides between all of these messages. It could even embrace the Clearances, suggesting they were bitter times in the past, but are an experience which has toughened and sharpened today’s Highlanders and Islanders.

The frontier idea could be broadened to bring in the idea of the Highlands and Islands as a land of revolutions. One definition of revolutions is that they are at the frontier of political, social, and eco-nomic change. Here, I am thinking more of the industrial revolution, or of the intellectual revolution of the Enlighten-ment, than of those in Russia or France.

Most have been about energy. First

Fertile ground for a new revolution

The issues in the Highlands and Islands clearly differ from those elsewhere

Diageo is well aware of the benefits of a specific market image

Chris baCon/pa


Business Insight4

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EXPORT TRAINING CENTRE

IN many ways it’s the most domestic of industries – Harris Tweed is still woven by local people in their island homes – but lately it has conquered the world’s youthful fashionable markets in a way that any super-cool

textile industry anywhere would envy.Indeed, its main producer, Harris Tweed

Hebrides, exports no less than 85 per cent of its product, with 40 per cent going to Japan and much of the rest to the US, Ger-many, France and Italy – as well as vibrant new markets like Brazil, Russia, India and Korea.

And the company’s chief executive Ian Mackenzie is quick to acknowledge the vital, catalytic role that Scottish Develop-ment International (SDI) has played in what has been their biggest challenge.

“It was all to do with image,” explains the man who was boss of the Harris Tweed Au-thority for 14 years before taking the HTH helm to lead an industry revival in 2007. “Harris Tweed had been around for a hun-dred years and was generally seen as a fabric for old men’s jackets. Our challenge was to stand that negative image on its head.

“Motivated by a wee bit of necessity and a wee bit of vision, we saw that the answer was in working with cutting-edge designers all over the world.

“This was where SDI help was invalu-able, backing up with action its strong com-

mitment to promoting Scottish textiles. Its many excellent people in global offices have invaluable knowledge of local markets, tal-ents and tastes. In Russia, for instance, we have been guided towards supplying fabric for interior furnishings.

“But they have essentially helped us achieve our twin objectives – the opening up of such new markets and the revival of one-time strong ones, such as the US, where in the 1990s our fabric had gone out of fashion. SDI has helped bring people like Saks Fifth Avenue back to the Harris Tweed table.”

Weaving out of the image straitjacket commercial report: HarriS tWeeD HeBriDeS

A joint venture between the Scottish Government, Scottish Enterprise and Highlands and Islands Enterprise, SDI is an award-winning body dedicated to bringing together these organisations’ resources to deliver support for companies investing in Scotland. Its assistance is about more than global knowledge – it also takes the form of promotion of foreign trade missions, help with travelling costs, sponsoring foreign journalists to visit the Harris Tweed cradle, and working closely with UK Trade and In-vestment (UKTI) and the embassy network “to offer the best of both worlds”, says Ian Mackenzie.

He adds: “Thanks to them, we have been highly visible at endless events for British luxury goods at British embassies in places like Tokyo, Moscow, Sao Paulo and Seoul.”

That’s where introductions to top design-ers have made a big difference; but it’s not all about foreign markets. UK interest is growing too, and it’s no longer just a tourist market. “Our creative director Mark Hoga-rth is pro-actively plugged in to the young fashion market and the British public are taking a fresh interest in us since we started working with high street names such as Top Man.”

So trend-conscious shoppers will wel-come less tweedy tradition these days – new lines include waistcoats, caps and bags – without an image straitjacket in sight.

Harris tweed Hebrides working with cutting-edge

designers all over the world


T he Highlands and Is-lands Development Board was created almost half a century ago and was given a wide-ranging remit which reflected the dire conditions then afflicting the region.

According to Willie Ross, the Secretary of State for Scotland who brought the HIDB into existence in 1965, the Highlander was “the man on Scotland’s conscience”. Out-migration from the region was endemic and eco-nomic opportunities were limited by poor infrastructure and lack of capital.

Few consciences need be burdened by the current state of the Highlands and Islands. Inverness is a vibrant city with a growing population and flourishing hin-terland. Throughout the region, vast levels of investment have transformed commu-nications and raised living conditions for the majority of the 450,000 inhabitants.

The statistics tell a positive tale and much of it is true. Taken as a whole, the Highlands and Islands represents a great success story over these decades. Both the old HIDB and its successor, High-lands and Islands Enterprise, have been at the centre of a transformational pro-cess of regional economic development to compare with anything in Europe.

When HIE was created in 1991, it re-tained the “social remit” which the HIDB had been granted at its inception. This has all along helped to ensure a crucially different kind of organisation from its “rest of Scotland” counterpart. HIE can be much more flexible in interpreting how it should invest in social as well as economic objectives.

Sometimes this has raised expectations to levels that could not be met. For ex-ample, great hopes were invested in the HIDB when it was set up that it would tackle the issue of Highland land owner-ship. It was widely believed — wrongly as it turned out — that the new Board had been given extensive powers of compul-sory purchase which would allow it to remove historic obstacles to economic development.

It took some time for the more pro-saic truth to dawn: that no development agency, however radical in concept, could pursue such policies without the clear political mandate of government. Once this was settled, attention moved to the kind of economy that should be aspired to in the Highlands and Islands, a

debate that has never fully been resolved.In the early days, under Sir Robert

Grieve, the HIDB spoke openly of a “growth point” model. In other words, the best hope for economic regeneration of the region lay in concentration on a few centres with the greatest investment potential. Primarily, this turned out to mean Inverness and the area round the Cromarty Firth, particularly once oil-related developments came on the scene.

It is many years since anyone would choose the “growth point” terminology though the reality of that approach has not gone away. In some ways, it makes complete sense. The problem has all along been that it drew population from the Highlands and Islands hinterland, so that some of the peripheral areas contin-ued to weaken while the centres became stronger.

This is a well-established process in any developing rural economy, irrespec-tive of public policy. The long-running challenge in Highlands and Islands terms has been to find ways of countering it by supporting policies and investments which were specifically geared to keeping people in those places which continue to suffer out-migration, often disguised by the favourable Highlands and Islands-wide statistics.

Increasingly, it has been recognised that the best hope of achieving this is through the endeavours and commitment of the communities themselves, rather than over-reliance on private entrepre-neurism and imported investment. The movement towards community owner-ship of land is the prime example of how this alternative approach can succeed.

So far, that movement has been largely limited to the west coast — from the Butt of Lewis in the north down to Gigha in the south. In total, almost half a million acres of land are now in community own-ership, more than the combined holdings in the Highlands and Islands of the Na-tional Trust for Scotland, RSPB and John Muir Trust — though still very much less than is in private hands!

The great thing about community ownership is that it is rarely seen as an end in itself. Acquisition of the land on which people live and work is a means to the objective of turning ideas into real-ity and projects into jobs. And the com-munity land ownership movement has given the tax-payer a tremendous bang for his or her buck, compared to other forms of public investment in peripheral communities.

Back in 1997, I had just become a Scot-tish Office minister with responsibility for the Highlands and Islands when I was invited to the official handover of the Island of Eigg to its new community own-ers. Eigg had become a cause célèbre due to the capricious behaviour of its previous owners and the inspirational effect of its transfer to community control was out of all proportion to the numbers involved.

Realising that the Eigg event offered an ideal platform for action, I phoned the then chief executive of HIE, Iain Rob-ertson, and gained his support for a new initiative — the establishment of a Com-munity Land Unit within HIE and a fund to accompany it. Under the leadership of John Watt, these provided the back-up necessary to encourage and support a string of further buy-outs over the years that followed.

In every one of the communities that took this massive step, ownership was the beginning of the story rather than the end. Each has engaged in projects that would not otherwise have happened and the results have started to be reflected population statistics. Gigha is a spectacu-lar case in point, up from 95 to 150. It is a long process — but it works.

South Uist, the biggest community buy-out at 92,000 acres, is perhaps the best example. After decades of popula-tion decline when nothing much hap-pened, the community landlords, Storas Uibhist, are now driving a £12 million regeneration of Lochboisdale harbour, a windfarm project which will yield £20 million for further investment and much, much more. None of it could have hap-pened without ownership of the primary resource: land.

There are now 26 full members of Community Land Scotland, the umbrella body for these buy-outs. But the potential has hardly begun to be realised. High-lands and Islands Enterprise has been

hugely supportive of the whole move-ment and, in spite of budget cuts, has made a clear policy decision to increase its focus on the most fragile, peripheral areas and community-based initiatives.

The Community Land Unit was later widened to include support for en-ergy developments and other social enterprises all under the banner of “strengthening communities”. Renewable energy schemes are particularly impor-tant because they generate money as well as electricity – and thereby allow for fur-ther investment in community projects.

My own belief is that there are still parts of the Highlands and Islands which should be much more firmly on Scotland’s radar, if not its conscience. All of Scotland values the images of the Highlands and Islands periphery, not to mention the language and culture which it sustains. But without people, all of that would become an empty shell.Brian Wilson is a former Scottish Office Minister with reponsibility for the High-lands and Islands.

All sailing in the same boatBrian

Wilson

The best hope in any developing rural economy is through the endeavours of its communities, not over-reliance on private enterprise

The community land ownership movement has given the tax-payer a bang for their buck

Economy, a former fishing boat which is the base of a sculpture on Lewis, is a fitting emblem of enterprise

ben gurr for the times

IN many ways it’s the most domestic of industries – Harris Tweed is still woven by local people in their island homes – but lately it has conquered the world’s youthful fashionable markets in a way that any super-cool

textile industry anywhere would envy.Indeed, its main producer, Harris Tweed

Hebrides, exports no less than 85 per cent of its product, with 40 per cent going to Japan and much of the rest to the US, Ger-many, France and Italy – as well as vibrant new markets like Brazil, Russia, India and Korea.

And the company’s chief executive Ian Mackenzie is quick to acknowledge the vital, catalytic role that Scottish Develop-ment International (SDI) has played in what has been their biggest challenge.

“It was all to do with image,” explains the man who was boss of the Harris Tweed Au-thority for 14 years before taking the HTH helm to lead an industry revival in 2007. “Harris Tweed had been around for a hun-dred years and was generally seen as a fabric for old men’s jackets. Our challenge was to stand that negative image on its head.

“Motivated by a wee bit of necessity and a wee bit of vision, we saw that the answer was in working with cutting-edge designers all over the world.

“This was where SDI help was invalu-able, backing up with action its strong com-

mitment to promoting Scottish textiles. Its many excellent people in global offices have invaluable knowledge of local markets, tal-ents and tastes. In Russia, for instance, we have been guided towards supplying fabric for interior furnishings.

“But they have essentially helped us achieve our twin objectives – the opening up of such new markets and the revival of one-time strong ones, such as the US, where in the 1990s our fabric had gone out of fashion. SDI has helped bring people like Saks Fifth Avenue back to the Harris Tweed table.”

Weaving out of the image straitjacket commercial report: HarriS tWeeD HeBriDeS

A joint venture between the Scottish Government, Scottish Enterprise and Highlands and Islands Enterprise, SDI is an award-winning body dedicated to bringing together these organisations’ resources to deliver support for companies investing in Scotland. Its assistance is about more than global knowledge – it also takes the form of promotion of foreign trade missions, help with travelling costs, sponsoring foreign journalists to visit the Harris Tweed cradle, and working closely with UK Trade and In-vestment (UKTI) and the embassy network “to offer the best of both worlds”, says Ian Mackenzie.

He adds: “Thanks to them, we have been highly visible at endless events for British luxury goods at British embassies in places like Tokyo, Moscow, Sao Paulo and Seoul.”

That’s where introductions to top design-ers have made a big difference; but it’s not all about foreign markets. UK interest is growing too, and it’s no longer just a tourist market. “Our creative director Mark Hoga-rth is pro-actively plugged in to the young fashion market and the British public are taking a fresh interest in us since we started working with high street names such as Top Man.”

So trend-conscious shoppers will wel-come less tweedy tradition these days – new lines include waistcoats, caps and bags – without an image straitjacket in sight.

Harris tweed Hebrides working with cutting-edge

designers all over the world


Business Insight6

Cover story

I’m off to Argyll and Lerwick next week. “Getting around the offices is impor-

tant to me; meeting stakeholders, busi-nesses and local government representa-tives is not just about visibility for HIE, it really helps me to get a better under-standing, a feel, for what is important to people in that area. It’s valuable for all of us, staff and stakeholders too.

“HIE is poised for the unfolding of some incredible opportunities, and we have to make sure we are in a position to make the most of them, following a sig-nificant spend on our infrastructure.

“For example, a £20 million invest-ment programme at Scrabster Harbour, in Thurso, is securing jobs and helping to position the north of Scotland at the forefront of the renewables revolution. We’ve also committed £1.8 million so far to the development of the 238-acre Nigg Energy Park site on the Cromarty Firth, where the Global Energy Group have targeted employing up to 2000 people within four years.

“Work is now underway at Beechwood, in the first phase of the Inverness Cam-pus project, creating a major new aca-demic and business park. Once the three-phase project is complete, it’s estimated the campus will support up to 6000 jobs while generating around £38 million a year for the Highlands and Islands econ-omy. Of course, we want to make sure the campus fulfils all our ambitions.

“We have also invested significant sums in the European Marine Energy Centre (EMEC), in Orkney, the test centre at the forefront of developing marine-based renewable energy, through technologies that generate electricity with the power of waves and tidal streams.

“We are also supporting the develop-ment of a major manufacturing yard at Arnish, in Stornoway, a long-term strategic location for the renewable sec-tor. Among the contracts there is the construction of a full scale prototype for Scotland’s most advanced tidal turbine.

“At Dunstaffnage, near Oban, we’ve made a £7.5million investment in the first phase of the new European Marine Science Park, and building is now under way.

“This is already an international centre of excellence for marine science, where the Scottish Marine Institute is home to the Scottish Association of Marine Sci-ence (SAMS) and the European Centre for Marine Biotechnology, and this will support businesses in Scotland’s growing Life Sciences and Energy sectors.

A firm sense of purpose as new peaks are conquered

Professor Lorne Crerar has hit the heights in the Highlands and Is-lands. A keen hillwalker, there aren’t many hills or mountain ranges he hasn’t clambered across or gazed upon.

However, Crerar, the founding partner

of Harper Macleod, one of Scotland’s most successful legal firms, has recently reached another landmark peak. Already a board member of Highlands and Is-lands Enterprise (HIE), three months ago, Crerar became chairman. He knows he has a hard act to follow.

“HIE’s results for 2011-12 were out-standing, an excellent performance by the organisation. For me now, as chair-man, the aim is to deliver more of the same.” As one would expect of a senior legal, Crerar makes a point of ticking the right boxes in taking time to praise the new management team and board at HIE, making it clear he feels “very for-tunate” to have landed the role there as chairman.

He knows there is a weight to carry in working to ensure the organisation’s strat-egy is followed and delivered. Against a backdrop of continuing economic con-cern and uncertainty, there is no doubt there will be challenges along the way.

However, HIE is on the road to ensur-ing the region is at the leading edge, and is a recognised international centre, for marine renewables, while continuing to spark the flourishing digital and life sci-ences sectors along the A96 corridor, and also working to support the fragile com-munities in more remote areas. Yet in setting this out, Crerar’s enthusiasm for the task ahead cannot be concealed.

“I’ve been going round all of our of-fices, which stretch from the Shetland Isles to Lochgilphead, as the Highlands and Islands region covers more than 50 per cent of Scotland’s land mass,” he says, by way of explaining how he has kicked off this new tenure. “I’ve been to Thurso, Wick, Inverness, Moray, and

“Of course, we’re continuing to look at opportunities such as offshore wind, wave and tide energy, suited to our unique ge-ography, and the development of Life Sci-ences down the whole A96 corridor.

Crerar has also been been visiting the Outer Hebrides, where HIE is working to support the growth of fragile communi-ties. “Given the fact these communities are at some distance from the mainland, effective communication is central to this. As broadband speeds increase in our remote communities, it will increase flexible working opportunities such as home working.

“Our community assets division in Auchtertyre has been assisting many areas in land management and owner-ship issues. It can take a long time for communities to fulfil their vision; it’s not easy, and they do need help, but most successful projects are driven by the en-ergies of the members of those communi-ties, as happened on Gigha and Eigg. The

The chairman of HIE, enthused about the significant prospects for growth in the region, believes he is in his dream job,writes Ginny Clark

renewables industry too, in a unique way, is creating opportunities for remoter communities.”

It’s interesting that when Crerar talks about the projects, and the people who will benefit, any distinction between HIE the organisation, and the Highlands and Islands as a region, becomes blurred. Indeed, it is sometimes difficult to inter-pret which he means. Crerar doesn’t talk about us and them, only “we”.

He may have been born and bred in Glasgow, but Crerar was only a city boy on weekdays. His weekends, then and now, are spent at Gairloch, in Wester Ross, where he still has long-established family connections.

“My grandad was the first person to bring a car to Wester Ross, you know,” he says, with considerable pride. “I still have huge family connections in the area, and I have an enormous passion, not just for this particular corner, but all of the High-lands and Islands.

HIE is poised for some incredible opportunities and we have to make the best of them


ulating growth has always been rooted in their belief in the effectiveness of a joint approach, of both social and economic interventions. The rewards are increasing opportunities for business and employ-ment, and the chance for communities to benefit directly from them.

A crucial element to ensuring this is a continuing success story, is the establish-ment of better communication through-out the region. HIE is now negotiating with BT to ensure there is access to su-perfast broadband across all areas of the Highlands and Islands, with work start-ing next year on a major project that is likely to cost up to £300 million.

“What is happening now is that more people see the Highlands and Islands as a great place to live and to work,” says Crerar. “Many of our inward investors say they have chosen the region, not just because of the great geography and in-frastructure, but also because the people here meet their needs in terms of skill, talent, and also of loyalty.

“Clearly, superfast broadband is criti-cal to ensuring this continues. We want to foster prosperity here, HIE’s overall vision is to help the region succeed and compete, with more people choosing to live, study, and invest here.”

The HIE role might appear all-con-suming, but for Crerar, of course, there are other demands on his time. A good rugby player, his sporting ambitions were curtailed by injury at the age of 19, and he opted to become a referee. Not one to approach any project by halves, Crerar is now a top rugby official, and was a judi-cial officer for last year’s world cup final in New Zealand. However, legal business remains his first love.

“My main passion is my law firm,” he says. “I set it up with my best pal, and it is now one of Scotland’s leading firms, with offices in Glasgow, Edinburgh and Inver-ness. We were the first firm in Scotland to set up a sports law division. It came about in 1993 following the experience I had when I went to the United States to referee, and it cost a fortune to insure me. We now act for a number of sporting organisations, in football, for SportScot-land, and for the 2014 Commonwealth Games in Glasgow.”

When he has a moment or two, Crerar is also involved in passing on the finer points of banking law to under-graduate and postgraduate students. So, would it be fair to describe him as a par-ticularly busy businessman?

“I do believe in the adage that if you want something done, then give it to a busy person,” he admits. “I’m very fortu-nate that I do what I enjoy — so if you give me something I’ll do it 100 per cent. Possibly, I’m at my limit now. However, it’s a real privilege to be part of HIE, and so, yes, I’m busy, but it is only time that is my pressure.”

He pauses for a moment, suddenly con-cerned he may have conveyed the wrong impression. “Wait — I don’t want anyone thinking I’m too busy? It’s all about mak-ing sure my time is used to maximum ef-fect, and I have a great personal assistant who manages my diary and helps me to achieve that. I’m managing my time suc-cessfully.”

For Crerar, taking on the chairman’s role at HIE, is not just about business success, it’s about carrying on a legacy: he is well aware that HIE has a special place in the hearts and minds of the people of the region it serves.

“This is where HIE has a distinct uniqueness,” he explains. “The organi-sation is embedded in the culture of the Highlands and Islands. It’s so well known and part of business life here that for me as chair, that brings lots of benefits. HIE

Team leader with diverse interestsProfessor Lorne Crerar founded award-winning Scottish commercial law firm Harper Macleod with Rod McKenzie in 1989. He is now chairman of the Glasgow-based firm, with 45 partners and around 268 staff working there, and at offices in Edinburgh and Inverness. Harper Macleod’s turnover to April 2011 stood at £17.1 million.

Crerar is Scotland’s only Professor of Banking, and has a part-time Chair of Banking role, which still involves some teaching at the University of Glasgow.

With numerous public sector roles over the past 12 years, Crerar, a former convenor of the Standards Commis-sion for Scotland, also chaired a sub-group in the Housing Improvement Task Force, and is generally credited as the architect of the Home Report System that was introduced here four years ago.

He was also a non-executive

director of the Scottish Government Justice Programme Board and was a member of the Audit and Risk Commit-tee. He was also independent chairman of the Review of Regulation, Audit, Inspection, and Complaints Handling of the Public Sector.

With a life-long love of sport, Crerar has been chairman of discipline for the Scottish Rugby Union and an Inter-national Rugby Board judicial officer since 1995. Over the same period, he’s also been chairman of discipline at the

European Rugby Cup and at the Six Nations.

In 2008, Crerar joined

the board of Highlands and Islands Enterprise, and

was reappointed for a further three-year term in 2011, becoming

chairman in March this year.

has been so instrumental to business growth and it’s great to be able to con-tinue that.

“When we have stakeholder lunches and meet many of the businesses we help grow, they are so positive about the con-tribution HIE has made to their area’s prosperity. We’re so much a part of the business community, and that’s some-thing I’d like to build on.

“When I started my business with my friend almost 25 years ago, it was just us, and now there are almost 300 of us. My main interest has always been business, it was not about being just a lawyer in a legal office. With HIE, as I’m going round the offices and meeting staff, it’s very fulfilling, helping them to meet their ambitions.

“This is my dream job, the place I want to be most.”

“I’m a hillwalker, that’s what brought me here to explore the area in my teens. I developed a love of open spaces, walk-ing and climbing almost everything, and I also bought a ketch and sailed the west coast. As I do travel about to visit the offices, I’m not going anywhere I’ve not been before. So from that point of view, none of it is new to me. What I am gain-ing from these trips, however, is a better understanding of our business.”

If not yet a golden era, this is certainly an exciting time for the region, and for Crerar to be overseeing HIE “business”. There has been a 20 per cent plus in-crease in the area’s population over the past four decades, while the number of people in work is up 50 per cent. Howev-er, as Crerar points out, the region covers more than half of Scotland’s land mass, but is mainly rural, being home to less than 10 per cent of the country’s popula-tion.

HIE’s success in encouraging and stim-

I do believe in the adage that if you want something done, give it to a busy person

james glossop for the times

Enterprise areasE

arlier this year, four new enterprise areas were created by the Scottish Government, offering additional incen-tives to investors in some of the country’s most important

growth sectors.Designed to create new employment

opportunities, stimulate private invest-ment and accelerate economic growth, each sectorally-themed area covers a num-ber of different sites across the country.

The move was particularly welcomed in the Highlands and Islands. Seen as a centre of great potential for renewable energy and life sciences, the region gained enterprise area status at seven locations in Orkney, Caithness, the Outer Hebrides, Moray, and the Inner Moray Firth.

Sections of the Enterprise Park, Forres, and Inverness Campus are included in the Life Sciences enterprise area.

Five Highlands and Islands locations comprise the Low Carbon/Renewables North enterprise area.

These are at Hatston and Lyness, both Orkney, Scrabster in Caithness, Arnish in the Outer Hebrides, and Nigg in Ross-shire, near Inverness.

Incentives for businesses in Enterprise Areas include:

• Up to 100 per cent rates relief at most sites

• A framework to ensure a speedy ap-proach to handling planning consents

• Priority for the delivery of next genera-tion broadband by 2015

• International marketing led by Scot-tish Development International

• Customised support from Skills Devel-opment Scotland

Nigg received a further boost in March, when it was chosen as one of three ‘enter-prise zones’ in Scotland. This UK Govern-ment designation means the site qualifi es for tax relief in the form of enhanced capital allowances.

Carroll Buxton, Director of Regional Development with Highlands and Islands Enterprise, said the introduction of enter-prise areas would stimulate investment and development at key strategic sites..

“Enterprise areas are about making things happen faster. HIE is ready to assist investors to maximise the advantage of early develop-ment at the range of sites across our region.

“At the same time, we will be vigilant to ensure that other key locations which have the potential to attract investment continue to receive HIE support.”

PROFESSIONAL BRIEF

Carroll Buxton, Director of Regional Development, Highlands & Islands Enterprise


Business Insight8

It is easy to forget that the area designated as the Highlands and Islands is truly vast. Running from Argyll all the way to Shetland, and from the Outer Hebrides across to Moray, the region covers more than half of the Scotland’s land mass. Population figures paint a different picture, however. Only 450,000 people — around eight

per cent of the national population — live in this beautiful, diverse and challenging part of the country.

This underlines a key difference be-tween development agency Highlands and Islands Enterprise (HIE) and many of its European counterparts: its remit specifically calls for the integration of

economic and community development.“A largely rural region with a scattered

population demands a different approach from a development agency,” explained Alex Paterson, HIE’s chief executive. “It is fundamental to ensuring that economic growth happens across the region rather than just in the places where it might well happen anyhow.”

For much of the 19th and 20th centu-ries, people were the region’s main export. Since the 1970s, though, that has been changing. The population has grown by a little above 3 per cent in the past decade to reach nearly 450,000. Depopulation still afflicts many remoter, more fragile and rural areas, but thousands of people in their 20s, 30s and 40s have migrated

into the region to share in a modern, di-versified economy withstanding recession better than much of Scotland.

Resilience is due in part to greater de-pendence on public sector employment; but while the future of such jobs is uncer-tain throughout Scotland, Highlands and Islands has bulwarks against decline.

“Traditional sectors such as food and drink, and whisky, have been doing well and exporting more while tourism has been holding up, perhaps helped by the exchange rate,” Paterson said. “And the Inverness to Amsterdam air route is prov-ing important.” This scheduled service, operated by Flybe, was secured by High-lands & Islands Airports Ltd and support-ed by HIE investment.

Creative industries — screen and broadcast, music, fashion, computer games, publishing and related disciplines — are growing fast. HIE works with hun-dreds of small businesses and musicians, writers, designers, film and programme makers.

Energy, life sciences, universities, and business and financial services are the

other growth sectors alongside food and drink, sustainable tourism and creative industries targeted for HIE support in its 2012-15 Operating Plan. A wide array of local, Scottish, UK and European funding sources for businesses and communities helps.

Working with Scottish Development International, a partnership of HIE, Scot-tish Enterprise and the Scottish govern-ment, the agency continues to attract inward investment, most recently by international IT services company Atos, medical diagnostics firm AccuNostics, and business outsourcer Capita.

Indeed, the region has become one of the most attractive locations in the UK for business process outsourcing. Other major players, including BT, CapGemini, Fujitsu, HEROtsc, TalkTalk and Vertex have invested in Highlands and Islands operations in recent years. All speak of the loyalty and quality of the workforce as vital factors behind their choice.

HIE’s slogan ‘Ambitious for Scotland’ speaks to an agenda that aims to see the 2020 version of the Highlands and Islands firmly established as: an inter-national centre for marine renewables; a digital region; the base for a wider range of growth businesses operating internation-ally; a globally recognised leader in digital healthcare and marine science; a region of dynamic, sustainable communities; a globally-connected place; and somewhere that is attractive to young people.

An in-depth look at what it is doing in energy, life sciences, education and strengthening communities shows confi-dence in the region’s ability to meet these aspirations.

Energy is a well-established indus-

Change in the air for Highlands and IslandsHighlands and Islands Enterprise is supporting a broad and successful range of businesses, communities, growth sectors, and a low-carbon future, hears Rob Stokes

Transport links are vital in a rural region with many islands

that has a population of 450,000 and is attracting thousands

more younger people

The creative industries, such as music, fashion and computer games are growing fast

Special reportjames glossop for the times


efit from additional incentives, from rates relief to fast-track planning and priority for next generation broadband.

HIE is meanwhile lobbying hard over the UK regulatory regime for the national electricity grid and access to it for renew-able energy projects in the North of Scot-land. “Physical issues with the grid are solvable: lines can be put in, and National Grid is well on with its plans,” Davidson said. “But we’re still in discussions on the cost of connection to and transmission from the islands to urban centres.”

Life sciences are thriving. Construction is underway at the £6.5 million Alexan-

try. Hydro-electric once brought major construction and what is now the Perth based utility Scottish & Southern Energy (SSE). Unlike in Norway and Austria though, most of the intellectual legacy lies elsewhere.

Oil and gas once employed thousands in fabrication yards. Oil and gas work re-mains important, and dismantling North Sea structures will bring later opportuni-ties. £10 million from the Scottish gov-ernment and HIE has been pledged for a deep-water quay facility in Shetland to secure decommissioning work by Norwe-gian owned AF Decom Offshore UK.

Again though, Highlands and Islands has provided a strong supply-chain for oil and gas while much of the innovation emanates from such as Aberdeen and Houston.

Renewables promises to be a game changer. “We have a once-in-a-genera-tion opportunity through marine energy and offshore wind,” said Calum Davidson, HIE’s director of energy and low carbon. “We don’t want to be just another place that exports energy. In wave and tidal, we can create a global industry and ensure intellectual stickiness.” As reported else-where here, the European Marine Energy Centre is the type of ‘glue’ that can secure R&D and all that flows from it.

The wider supply-chain is important too, so HIE supports infrastructure devel-opments. Serendipitously, large fabrica-tion yards built for oil and gas are perfect for renewables.

Nigg on the Cromarty Firth is develop-ing under Scottish based owners Global Energy Group (GEG) into a multi-use

energy park on 230-acres with one of the world’s largest dry docks. With Scottish government assistance through Skills De-velopment Scotland, the Scottish Fund-ing Council and HIE, GEG has launched Nigg Skills Academy, offering 290 Mod-ern Apprenticeships in its pilot year. It envisages training 3,000 people by 2015 for all energy sectors.

At 270-acres, the former McDermott oil fabrication yard at Ardersier on the Moray Firth is Scotland’s largest brown-field site. Through HIE, it is attracting in-terest in reviving manufacturing, but for renewables.

The Kishorn yard and dry dock on the West Coast, under energetic local ownership and working with HIE, seeks opportunities to create next generation, concrete sub-structures for offshore wind, wave and tidal.

At Machrihanish, Wind Towers Ltd — a joint venture between SSE and the UK subsidiary of Hong Kong’s Marsh Global Holdings — produces some of the larg-est towers for onshore and future offshore wind structures, with £3.4 million assis-tance from HIE.

While at Arnish Point on Lewis, Burn-tisland Fabrications builds structures for the offshore wind, wave and tidal sectors. Significant investment from HIE means the facility is state-of-the-art.

In Caithness and Orkney, around the Pentland Firth and Orkney waters, £35m is being invested by HIE, the private sec-tor and local authorities in infrastructure to exploit the world’s only commercial-scale leasing area for wave and tidal power.

This includes an industrial park and deep water quay at Scrabster, Caithness. The Orkney elements are: quay front-age and land at Lyness; developments at Stromness and Kirkwall harbours; and six new units for tidal developers at Hatston Industrial Estate, Kirkwall, in a £3m in-vestment by the agency and the Euro-pean Union.

Five key renewables infrastructure sites — Arnish, Hatston, Lyness, Nigg and Scrabster — form the Scottish Govern-ment-designated Low Carbon/Renewa-bles North Enterprise Area. Businesses locating there within five years can ben-

Calum Davidson, here at Nigg, believes renewable energy development is an opportunity that comes once in a lifetime

tim Winterburn/hie

In the information age, modern digital telecommunications have become an essential component of every successful economy.

Highlands and Islands Enter-prise estimates that adoption of

advanced information communications technology could generate an additional £100m in our region’s economy over the next five to seven years, and contribute to carbon reduction.

Potential benefits to businesses include opportunities to improve efficiency and drive sales to existing and new customers, both in the UK and internationally.

HIE wants to see the advantages of next generation – or ‘superfast’ – broad-band benefiting all parts of the region, not just the main urban centres. We understand, however, that commercial broadband providers need to make profits, and the case for private investment is not strong. That is our rationale for providing public funding.

HIE has a unique remit which com-bines community development with the pursuit of economic growth. That enables the agency to invest in remote and fragile areas where private providers and even other development agencies could not.

Our ambition is for all areas to gain access to superfast broadband, able to receive a reliable service, offering smooth, fast connections.

Over the next few years, HIE plans to work with partners to create the infrastructure and conditions which will

enable new technologies, including next generation broadband, to be rolled out across the whole of the Highlands and Islands.

The agency will also promote the ben-efits of digital technology to businesses and communities and offer information, advice and training to ensure as many users as possible take up the opportunities which superfast broadband will deliver.

Just as dial-up modems gave way to faster broadband services some years ago, superfast will soon become the standard level of telecoms service expected in developed countries.

Usually delivered through carbon fibre filaments, rather than copper wires, it offers both a faster and more reliable ser-vice, well suited for uploading, download-ing and streaming very large files such as movies, videos, music and graphics.

With modern broadband, businesses and communities in rural areas can access information and make fast connections across the world, something which only major ports, towns and cities could achieve in past generations.

Like transport networks or mains electricity, broadband is a great enabler, a service which can benefit businesses in every sector of the economy.

In 2011, HIE launched a procure-ment exercise to appoint a commercial business with the skills and experience to co-invest in ensuring that next genera-tion broadband infrastructure is delivered across the region. Several businesses

expressed interest, and BT has proceeded to dialogue stage.

If negotiations between HIE and BT conclude successfully, a contract is expected to be awarded by the end of August and rollout will be phased over the coming years, beginning in 2013.

Funding is already committed by HIE and Broadband Delivery UK. To achieve its vision fully, HIE recognises that more public investment will be required. Talks are currently under way with poten-tial investors in both central and local government, and support is being sought from the European Regional Develop-ment Fund.

Stuart Robertson is HIE’s Head of Digital

PROFESSIONAL BRIEF

At the digital edge

Stuart Robertson


Business Insight10

der Graham Bell Centre at Moray Col-lege UHI, Elgin. This pioneering rural life sciences centre stems from a partnership between the college, HIE, the Scottish Government, NHS Grampian, academia and business.

Digital healthcare — where consult-ing, diagnosis and advice are delivered remotely using medical devices, phones, televisions and the internet — is a major focus for HIE.

The Inverness to Elgin corridor is one of the world’s first true digital healthcare clusters, comprising 40 organisations in-cluding companies, NGOs, health boards and academia.

LifeScan Scotland — Scotland’s biggest life sciences company and part of US gi-ant Johnson & Johnson — has an inter-national R&D and manufacturing base in Inverness for blood-glucose monitoring devices for people with diabetes.

AccuNostics, which designs, develops and manufactures advanced devices for diabetes self-monitoring and clinical use, has located on the Enterprise Park at For-res with £2.5 million from the Scottish In-vestment Bank and £1.5 million from HIE.

Digital healthcare expertise is export-able. HIE was visited recently by an over-seas company interested in importing know-how from the cluster to develop systems for rural healthcare services in a developing country.

“We have all that’s required,” said Dr Steven Dodsworth, HIE’s head of life sci-ences. “This includes established disci-plines supporting development of medical devices, diagnostics and sensors. Howev-er, expertise in health economics, creative content, social and consumer psychology will all be necessary to deliver healthcare through consumer electronic devices, which is the way it is moving.”

Healthcare systems for rural communi-ties tend to work in cities too, while the reverse is not always true, which bodes well for commercialising IP from rural focused R&D.

Western Isles, Highland, and Moray are part of a UK project that will deliver mainstream healthcare services using distance technologies such as phone and television to promote health and wellbe-ing to help people to live independently regardless of location.

The ‘Delivering Assisted Living and Lifestyles at Scale’ (DALLAS) project sprung from the UK’s Technology Strat-egy Board (TSB) and is co-funded in Scot-land by the TSB itself, Scottish Govern-ment, Scottish Enterprise and HIE. The £10 million initiative will provide valuable insights and data for Scottish companies.

Scotland’s natural resources are cov-eted for natural products including phar-maceuticals, dietary supplements and skin care products.

German chemicals multinational BASF has recently acquired Equateq on Lewis to invest millions on producing omega-3 oils for drugs and dietary sup-plements. HIE assisted Equateq’s growth and the Scottish government has ap-proved Regional Selective Assistance of

£2.95 million to support future expansion.Dietary supplements, food, life sciences

and renewable energy are the cross-sectoral foci for the European Marine Science Park being developed at Oban, Argyll, with £7.5 million first phase fund-ing from HIE. 20,000 sq ft of office and laboratory space are being added next to the internationally recognised Scottish Marine Institute, part of the University of the Highlands and Islands.

Broadening knowledge through higher education and applying research to busi-ness needs and commercialisation plays strongly into HIE’s growth sectors.

Four Scottish universities — Heriot Watt, Aberdeen, Stirling and the Glas-gow School of Art — have footprints in the Highlands and Islands, with Heriot Watt having a significant outreach opera-tion in Stromness, Orkney. The Scottish Agricultural College (SAC) has some 40 researchers in Inverness with strengths in epidemiology, animal health and disease control.

HIE sponsors managers from globally ambitious Highlands and Islands busi-nesses to attend the Entrepreneurship Development Program at the Massa-chusetts Institute of Technology’s (MIT) Sloan School of Management in Boston, USA.

The University of the Highlands and Islands (UHI), a collegiate institution spread across the region so it is close to communities and local businesses - gained its title last year. Recognising the important role a successful university can plan in a modern economy HIE has been an active supporter ever since the ‘UHI project’ was mooted in the 1990s. Today that commitment remains just as strong.

“Like all Scottish higher education in-stitutions, UHI is increasingly aligning itself to the opportunities and demands of the economy as outlined in the Scottish Government’s economic strategy,” said Morven Cameron, HIE’s head of academ-ic development.

“One thing all successful regions have in common is the presence of a strong lo-cal university. That’s been lacking in the Highlands and Islands until now, but the creation of UHI changes things and its future development has the potential to drive economic growth across a range of sectors.”

“HIE’s investment prioritises research in life sciences and marine renewables, where the region has competitive ad-vantage and there’s tremendous poten-

tial for R&D and commercialisation. We also recognise the value of UHI in at-tracting and retaining population in the region, particularly young people.

Still in its adolescence, UHI can al-ready boast several prestigious centres of excellence, including the Scottish Marine Institute in Argyll, a department of dia-betes and cardiovascular science, Inver-ness, and the Environmental Research Institute, based at Northern College UHI, Thurso.

HIE’s work to develop the 215 acre ‘In-verness Campus’ site on the eastern side of the city for business, academic and com-munity use to foster knowledge-transfer, will also underpin the institution’s future.

However, Cameron added: “We also recognise the value of collaboration with other universities. In particular, our natu-ral environmental resources and geog-raphy provide an abundance of research and test-bed opportunities.

“For example, the whole of Stromness has been touched by Heriot Watt’s pres-ence, growth and spread into renewables,” Cameron said. “From four staff in 1986, the cumulative impact and resulting spin out of companies has led to direct em-ployment equivalent to 130 full-time jobs.”

This speaks strongly to the Strength-ening Communities agenda under which HIE reaches into fragile areas to work with businesses and social enterprises that are smaller than a purely economic agency could normally support.

“One problem over the years has been people leaving fragile communities,” said Alex Paterson. “You eventually end up with no school, no doctor, no post-office, and so on. In our view, and in the Scottish

government’s view, you can’t let that hap-pen, so you have to be proactive.”

HIE, the Scottish Government and Big Lottery Scotland run the £6m Scottish Land Fund, which will open to applica-tions this summer to expand community ownership.

This strategy for strengthening com-munities is already transforming some 170,000 hectares in locations such as Gigha, Eigg, Knoydart, Assynt, Rum, Muck, Skye, North Harris and South Uist.

In South Uist, for example, HIE award-ed £5 million to community landowner Sealladh na Beinne Moire, a social en-terprise, for a £9.9 million development of Lochboisdale Harbour to prepare land for business development and community housing, and to create infrastructure for fisheries, aquaculture and marine tour-ism. 126 full-time equivalent jobs are fore-cast.

The HIE-funded Connected Commu-nities advanced wireless broadband net-work in the Outer Hebrides serves private and public subscribers who might other-wise lack the convenience and earning power of broadband.

Strengthening Communities is not just about grants. £2.5 million has been com-mitted to recruit local development man-agers working with fragile communities in a Community Account Management model.

In 2011-12, for example, HIE account managed 144 social enterprises, a third of them based in fragile areas. It committed £3.7 million to projects run by social en-terprises, and 87 such organisations were supported by the Just Enterprise consor-tium of Scotland’s key social enterprise support agencies in a programme funded by HIE and the Scottish government. HIE works with the Scotland-wide Social Enterprise Academy to deliver leadership training in communities.

“The account management model has worked well in helping communities to develop plans and access what we can bring to the table,” said Alex Paterson.

EMEC is on the crest of a waveMORE wave and tidal energy machines are being trialled at the European Marine Energy Centre (EMEC) in the Orkney Islands than in the rest of the world put together. Its 14 berths are currently full, underlining a dominance established since launching nearly 10 years ago as the first, and still the only, grid-connected facility for full-scale marine energy prototyping. The £15 million initial funding came from public sources including Highlands and Islands Enterprise (HIE).

EMEC is a major reason why the world sees Scotland as the in-place for wave and tidal energy developments, particularly with the relevant waters having some of the highest wave and tidal energy potential in the world.

“The Danish onshore wind experi-ence taught us that if you can capture testing and accreditation of devices early on, then the world comes to you and it’s easier to develop a supply-chain,” said Calum Davidson, HIE’s director of energy and low carbon.

Even in its infancy, marine energy

employs some 550 people in Scotland. “I would be surprised if there are 550 people in the rest of the world involved in this,” Davidson observed. There are at least 250 in Orkney and probably another 100 in the rest

of the Highlands and Islands, he added.

“So through the Highlands and Islands, Scotland is at the centre of this industry. We are probably five to seven years ahead of America. We’ve seen significant acceleration in wave, tidal and offshore wind in 18 months, and the next 18 months to three years will see an exponen-tial ramping up of activity.”

EMEC’s world class status was underlined last month when it announced a major collaboration under which it will provide advice and support on design, set up and operation for a Pacific Marine Energy Centre, a grid-connected marine energy test centre proposed for the USA’s Pacific Northwest coast.

HIE supports routes from Highlands & Islands Airports that include the one between Inverness and Amsterdam

Alex Paterson believes HIE must be proactive about fragile communities

The region has lacked a small local university until now but the creation of UHI has the potential to drive economic growth


Recent examples include floating pon-toons that have boosted marine tourism at Lochaline on the Morvern Peninsula and a wind turbine generating income for Westray, Orkney.

Similarly, HIE and the Scottish Gov-ernment co-fund the charitable social enterprise Community Energy Scotland (CES), which provides support, advice, and some early stage funding for rural business and community renewable en-ergy projects. Scotland-wide, but with

main offices in Dingwall, Ross-shire, CES backed 27 projects in the Highlands and Islands in the last financial year.

Support for cultural activities that un-derpin confidence and economic activity includes continued funding for: the Fèi-sean nan Gàidheal traditional music and Gaelic arts festivals and tuition move-ment; the Gaelic support bodies Commun na Gàidhlig and Clì; and the arts and cul-ture agencies HI-Arts and Pròiseact nan Ealan.

Isle of dreams proves power of ownershipWhen the 10th Isle of Gigha Music Festival kicks off later this month, the 150 residents of the small Inner Hebridean island will still be in a party mood as they celebrate a decade of independence from a single landlord.

Their Isle of Gigha Heritage Trust bought the island three miles off Kintyre in March 2002 for just over £4 million after the family that owned it put it on the market. Highlands and Islands Enterprise (HIE) chipped in with a £500,000 grant on top of some £3.5 million from the Scottish Land Fund set up by the Scottish Government for just such a purpose and which assisted hundreds of communities.

A decade later, islanders look back with pride at how they raised a million pounds for repayments falling due within two years; at how the local hotel is still in action, at the return of islanders who had left but now see a

future; at a playpark for their children; new walkways to encourage visitors; an island website that sells Gigha branded gifts online; better housing; new businesses and plenty more in the pipeline. Symbolically perhaps, three

onshore wind turbines whose installation was unanimously approved by the islanders feed electricity into the grid and generate a profit for the community that dared to tilt at windmills and the weight of history, and won. It lit a beacon for other communities who have since discovered for themselves that owning the land and other local assets can be the first step on the road to revitalising local amenities, economies, oppor-tunities, and quality of life.

Developments have also been supported by The Big Lottery Fund which is col-laborating with HIE to deliver the new £6 million Scottish Land Fund over the next three financial years to April 2015.

HIE’s investment prioritises research in life sciences and marine renewables, with tremendous potential

angus maCkay/hie

A swathe of former farmland on the east-ern edge of Inverness is being transformed to host thousands of high quality jobs

over the next 30 years – and provide an inspiring location for university and college students in the Highland capital.

Highlands and Islands Enterprise is investing up to £25m to create Inverness Campus as one of Scotland’s finest locations for business, learning and research.

Inverness College UHI is confirmed as an early occupant. The college, part of the University of the Highlands and Islands, plans to relocate to purpose-built £50m premises in 2015.

Other partners already on board include Inverness’s Centre for Health Science and the Scottish Agricultural College. Albyn Housing and Calman Trust plan to develop an innovative business which will provide high qual-ity hotel accommodation along with career opportunities for disadvantaged young people.

When construction on the 250-acre site began in February, Cabinet Sec-retary for Finance, Employment and Sustainable Growth, John Swinney, said, “Inverness Campus is an exciting and innovative project which will attract investment, jobs and education opportunities to the Highlands for dec-ades to come.”

With the potential to support up to 6,000 jobs over the next 30 years, Inverness Campus is one of the most important developments taking place in the Highlands and Islands. But it’s far from being alone.

Across the region, HIE is investing millions in a range of projects designed to have a significant impact well be-yond their immediate location. Some are led by HIE itself, others developed in collaboration with partner organisa-tions.

These ‘regionally significant invest-ments’, as the agency calls them, cover all the growth sectors identified in the Government Economic Strategy and aim to lay foundations for economic growth across the region.

At Dunstaffnage, near Oban, build-ing work is under way on the European Marine Science Park, being developed by HIE with support from the European Regional Development Fund.

The £7.5m science park aims to capitalise on the superb marine resource around the Argyll coast, and the international reputation of the neighbouring Scottish Association for Marine Science. It will create new opportunities for research and com-mercialisation which could support up to 125 jobs.

The campus and science park are among 14 major investments which HIE is currently progressing.

Projects which will deliver benefits across the entire region include sup-

porting the UK’s newest university, UHI, to develop high quality learn-ing and research, and working with industry and other funding partners to deliver access to superfast broadband.

The Highlands and Islands’ potential to help establish Scotland as world leader in renewable energy is being developed through a range of invest-ments at sites including Nigg in Easter Ross, Machrihanish in Argyll, Arnish on Lewis, Scrabster in Caithness, and Hatston and the European Marine Energy Centre in Orkney.

Life sciences is another growth sector benefiting from multi-million pound initiatives targeting both the region’s capacity as a source of natural products and is role in the emerging in-ternational market for digital delivery of healthcare.

Significant life sciences projects currently under construction include the European Marine Science Park in Argyll and the Alexander Graham Bell Centre in Elgin.

A prestigious new centre for crea-tive industries, Mareel, is due to open in Lerwick this summer, and one of Scotland’s most famous locations, John O’Groats, is currently being trans-formed.

Under the terms of HIE’s unique ‘strengthening communities’ remit, investment is targeted towards fragile areas, as well as locations which will have an impact on regional or national economic growth.

For several years now, the Connected Communities project has delivered a broadband service to parts of the Outer Hebrides which no commercial opera-tor would have reached.

Last year, HIE approved a £5m pack-age to enable community landowner Storas Uibhist to develop Lochboisdale as an economic driver for the Uists.

Nobody pretends such actions of-fer quick fixes. By their nature, they typically achieve their impact over a timeframe of several years.

But the evidence of past projects demonstrates the value of HIE’s ap-proach. The Centre for Health Science in Inverness, a £23m investment when it opened five years ago, is now a rec-ognised component of the Highlands’ life sciences cluster, housing teams

from four Scottish universities and employing hundreds of researchers and educators.

HIE support for Gaelic College Sab-hal Mor Ostaig UHI on Skye, including the Fas Centre for Creative Industries, has not only established the college as an important education institution, but also helped regenerate the Sleat peninsula.

The European Marine Energy Centre in Orkney is another project currently making a significant economic impact as a result of past investment. And there are countless other examples.

The agency expects its portfolio of regionally significant investments will grow over the coming years as new opportunities emerge, particularly in energy and life sciences.

PROFESSIONAL BRIEF

Building the future


12

Ambitious for energy

Highlands and Islands EnterpriseCowan House, Inverness Retail and Business Park, Inverness, IV2 7GF, Scotland

Tel: +44 (0)1463 234171email: [email protected] | www.hie.co.uk | www.hi-energy.org.uk

The Highlands and Islands, a region covering the north and north-west of Scotland, has arguably the world's best combination of renewableenergy resources, technology development, testingand deployment infrastructure, skills and expertise.

Home to around a quarter of Europe's natural windand tidal resources and 10% of the wave resource, the region is ideally placed to remain at the forefrontof the fast-emerging offshore renewables sector.

Highlands and Islands of Scotland – the home ofOFFSHORE RENEWABLE ENERGY













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