Business bodies urge new government to focus on growth

With the SNP leader John Swinney set to secure a fifth term in power, despite having fallen short of an overall majority in last week’s Holyrood election with 58 seats, calls are growing for the incoming administration to forge a “genuine partnership” with business.

Some pointed to the need for greater cross-party cooperation in light of the more “fragmented” make up of the new Scottish Parliament, with Labour and Reform UK coming joint second with 17 seats apiece, followed by the Scottish Greens on 15, the Scottish Conservatives on 12 and the Scottish Liberal Democrats on 10.

Michelle Ferguson, the director of CBI Scotland, said the SNP’s return to power was a positive in that it represented continuity, but stressed the election results underlined the need for “fresh ambition, genuine partnership, and a willingness to work across party lines.”

She said: “With costs rising sharply for businesses and consumers alike, there is no time for a victory lap. Growth must be the defining mission of this parliament, particularly as experts warn of a serious fiscal crunch in the years ahead. To put Scotland on a sustainable footing, the new government must work hand‑in‑glove with business to build a competitive, growing economy where enterprise can thrive.

Read more: What Scottish Government must do to tackle its £5 billion black hole – and avoid a £50 billion one

“While global events have undoubtedly increased pressure on our economy, there are clear choices that can be made to put Scotland on a stronger path to growth. Reforming an unfair and outdated business rates system, modernising a planning system that too often discourages investment, and building a skills pipeline that is more responsive to real world demand should be early priorities in its Programme for Government.”

Elsewhere, Gail Boag, chief executive of the Institute of Chartered Accountants of Scotland (ICAS), said there was a need for ambitious long-term policies to deliver investment and unlock growth in Scotland.

“The immediate priority must be to set out a clear, coherent long-term economic direction that restores confidence and unlocks the investment Scotland needs,” she said. “Delivering sustainable, viable growth will depend on decisive action to strengthen the country’s economic foundations, boost productivity and improve outcomes for people and communities.

Scottish politics has never been more important - get The Steamie newsletter today

“Our latest insights underline the importance of stable and predictable economic and tax policy, a strong pipeline of the right skills, improved financial literacy across society, and faster progress towards a low-carbon economy. Meeting these challenges will require collaboration between government, business, educators and professional bodies.”

Meanwhile, the Scottish Licensed Trade Association (SLTA) said “the time for talking shops is over” and called on the new government to carry out a view of the commercial rating system, and put in place a sector-specific poundage rate for licensed hospitality.

“A full review is needed to at least bring Scottish-based licensed hospitality businesses in line with, or improve on, similar businesses south of the border when it comes to commercial rates,” explained the SLTA’s managing director, Colin Wilkinson.

Read more: Five ways the Scottish government can help the country's hard-pressed shops

Marc Crothall, chief executive of the Scottish Tourism Alliance, said business rates reform must be a priority, alongside “nurturing” the tourism sector, as opposed to “stifling growth.” He called for the appointment of a named cabinet secretary or minister with “clear responsibility" for tourism and hospitality.