EXECUTIVE SUMMARY
The following Operational Programme provides the framework for the spending of the European Social Fund ( ESF) for the Convergence Programme for Scotland for 2007-13. The Programme covers the Highlands & Islands area, defined as the NUTS 2 area of the same name. It will complement the European Regional Development Fund Programme under the Convergence Objective for the same area. The Highlands & Islands area is particularly challenged by the unique combination of peripherality, insularity, low population density, a widely dispersed enterprise base and low GDP. In particular, the two phenomena which substantially influence the identification of priorities and allocation of resources for this Programme have been low GDP and relatively low value added by the enterprise sector, contrasting with the near-full employment of the region.
The Programme takes account of the significant progress achieved in the last programming period and details the strategic framework and priorities considered most appropriate in addressing the region's continuing development needs. It reflects strategic national priorities and sets Lisbon goals in context and how the partnership expects to respond to these.
The Highlands & Islands area is particularly challenged by the unique combination of peripherality, insularity, low population density, a widely dispersed enterprise base and low GDP. The region is quite distinct to the rest of Scotland in economic terms as well. It has an ageing population compared to Scotland as a whole and although recent years have seen a reversal in the historic population loss, there are still pockets of out-migration. Employment and economic activity rates are higher and unemployment lower than in the rest of Scotland, although seasonality and underemployment also feature, but the median earnings are less than that for Scotland as a whole. In particular, the socio-economic analysis of the regions suggest that there are a number of key strategic challenges which the Programme should address.
1. Tackling the problems of worklessness in certain client groups. Worklessness is more prevalent in certain client groups in the Highlands & Islands, but overall, is less concentrated that is the case in the rest of Scotland. Although the 'sick and disabled' working-age jobless on DWP benefits have been growing in Highlands & Islands and is by far the largest group of jobless people, support needs to be flexible at a local level to address the particular client group issues faced by different parts of the Highlands & Islands. Addressing the issue will help to alleviate the tight labour market problems in the region.
2. Encouraging women returners into the workforce. Women returning to the labour market confront particular problems in terms of the range and quality of employment on offer.
3. Addressing under-employment. Under-employment is a serious and distinctive issue for Highlands & Islands. In relation to the employability agenda it can act as a disincentive for people to move from benefits in to work.
4. Improving the ability of the low-waged and low-skilled to progress in the labour market. Only a small proportion of the low-waged/low-skilled employees appear to progress in the labour market. There needs to be a concerted attempt to deal with this issue and so expand the supply of labour to the higher-skilled jobs. In particular, migrant workers often have little access to sustainable employment.
5. Reducing the gender earnings gap and occupational and sectoral under-representation. Persistent gender earnings gaps and strong gendering in specific occupations and industries need to be addressed more effectively, both to widen opportunities for women and increase the labour supply to male-dominated occupations and industries.
6. Improving the management skills of the region. To increase 'higher-level' skills, management skills training and continuing professional development could be targeted at the large number of small enterprises in the region.
7. Addressing the capacity of social partner by providing social enterprises with the business skills for sustainable and thriving organisations.For social enterprises, capacity building is closely linked to the need to build up the skills of key managers. This can then help these organisations to sustain and grow the enterprises and the associated employment, and deliver more effective services, particularly to fragile and peripheral communities in the region.
8. Improving the access to lifelong learning and training for particularly disadvantaged groups. In terms of headline figures, the Highlands & Islands compares favourably in terms of overall participation rates in lifelong learning, but participation rates vary considerably by group. This underlines the need to focus on the most disadvantaged, particularly those living in peripheral and fragile parts of the region.
9. Improving the capacity of the UHI to deliver lifelong learning and training to the region. Limited access to a range of further and higher education opportunities has led to limited participation in lifelong learning and training. Recent investment in higher and further education infrastructure (partly funded by ERDF and ESF) as part of the UHI network has provided a solid foundation on which to build, supporting the development of online learning, learner support and e-learning opportunities, so that all learners may be able to participate, irrespective of geographical location.
The strategy for the ESF Convergence Programme proceeds from the identification of key challenges within the socio-economic analysis and the need for actions to fit with EU, UK and Scottish policy frameworks and the experience of previous programming. The EU resources in the ESF programme are €52.15 million for 2007-13, resulting in a total Programme value of €104.3 million. It is essential that the Programme aims to deliver lasting legacies to the region that will extend beyond the programming period. The end goal in each is consistent with national policies and therefore similar to that in the Lowland & Upland Scotland ESF programme; the difference is in emphasis and the need to address the distinct geographical and historical access issues. Consequently, the strategy for the ESF Convergence Programme for the Highlands & Islands area is set by its overall vision:
to contribute towards sustainable growth in the size and skills of the region's workforce within the Lisbon jobs and growth framework, through developing the knowledge-based economy of the region
The strategic vision of the ESF Programme operates through three sets of Objectives, addressing market failures in the following areas:
1. Increasing the Workforce
2. Investing in the Workforce
3. Improving Access to Lifelong Learning
Objective 1: Increasing the workforce
Increasing the size of the workforce is important if the Highlands & Islands is to contribute to the Lisbon jobs and growth agenda. As the socio-economic background highlighted, trends in the region's population have emphasised the importance of ensuring that there is a large enough labour force to drive Highlands & Islands economic growth, an issue of particular importance given the demographic and population density trends in the region. This not only means supporting the training of groups which face barriers to entering the workforce but ensuring that they have the skills to gain sustainable employment. Sustainability is crucial - the aim is to make sure that beneficiaries not only get jobs, but that they also have the skills to support themselves in long-term employment. Given how limited are the Programme's resources, it is crucial that within this Objective, funds should target those groups where support could make a particularly significant difference, notably those that face multiple or acute disadvantages as well as those that are not already well supported through other sources of policy support. It also needs to be sensitive to the local variations in the client groups and to the particular set of challenges facing each individual, as well as those returning to the labour force, such as older workers and women returners. In addition, the prevalence of under-employment in the region should be addressed with a view to assisting individuals to progress towards full-time, more sustainable employment, where appropriate. Consequently, the Objective has been set as follows:
to broaden and increase sustainable participation in the Highlands & Islands workforce, particularly for groups which face severe and multiple disadvantages
Objective 2: Investing in the workforce
Improving the quality of the regional labour market can contribute directly to the productivity increases, building on the currently strong employment rates by addressing skills gaps and shortages across the region. This Objective has several dimensions. Funding should concentrate on those parts of the workforce that are most at risk of losing their jobs - in other words, providing the skills necessary for sustainable employment. This includes ensuring low-skilled, low-paid, under-employed and migrant workers have the necessary skills to take advantage of opportunities for higher-quality, better-paid and more sustainable employment. The Objective also means that there is a need to target the higher-level management skills in the economy. Continuing professional development to ensure higher level training and support for professionals, particularly those working with more rural communities, will also be addressed. As part of the enterprise sector, particular support is also required for managers of social enterprises - critical to supporting the capacity of social partners is enabling them to become more sustainable.. Consequently, the Objective has been set as follows:
to increase skills and earnings levels within the Highlands & Islands workforce in all sectors of the regional economy, with particular reference to priorities identified in the ERDF programme, fostering the growth of enterprises and entrepreneurship
Objective 3: Improving access to lifelong learning
The knowledge, skills, competencies and other attributes acquired through learning, contribute to economic activity. Accumulating knowledge and skills enables individuals to improve their position in the labour market, increases productivity and earnings, and collectively enhances the society in which they live. Underpinning the efforts to increase the size and skills levels of the workforce is the lifelong learning and training environment. This Objective recognises that support for individuals must be made in parallel with improvements to the systems that will enable them to access the training and support needed to enter, stay and progress in the labour market. That not only means enabling those within the lifelong learning and training sector to improving their ability to reach out to all groups, but also allowing them to work collaboratively with other agencies to invest in new methods, technologies and models for accessing lifelong learning. It also needs to be targeted on those groups and enterprises as well as non-traditional groups of learners for whom lifelong learning access is the greatest challenge. Lastly, and perhaps most importantly, it will support the development of one of the legacy projects of EU funding in the region - the UHI and its network, by supporting its ability to become a driver of skills and lifelong learning provision in the Highlands & Islands. Consequently, the Objective has been set as follows:
to widen access to lifelong learning, increasing the range of quality education and training provision available and participation rates, particularly through the UHI and its network
Funding under this priority will be partly delivered by the UHI Millennium Institute as a Strategic Delivery Body, which will be charged with carrying forward a series of key strategic project to address lifelong learning on a region-wide basis.
The Programme will be fully complementary with other sources of EU funding, particularly the European Regional Development Fund (including the Co-operation Objective), the European Agricultural Fund for Rural Development, the European Fisheries Fund and EU research and lifelong learning programmes.
The Programme will also promote three key cross-cutting themes: equal opportunities; environmental sustainability; and social inclusion. These will be mainstreamed into all aspects of project design, delivery and monitoring.