Following confirmation of the additional energy producers’ profits levy on companies by the UK Government, Dr Liz Cameron CBE, Chief Executive of the Scottish Chambers of Commerce, said:
“Scotland’s businesses warned about the damaging impact that any sort of additional windfall tax on energy companies would have on the economy and our ability to secure a successful energy transition that protects jobs and communities.
“It is extremely disheartening that the UK Government have chosen to introduce this additional levy which will inevitably deter investment and make Scotland and the UK a less attractive market internationally, adding to the pressures facing the business community.
“Whilst it’s right that the Government take steps to ease the cost of living crisis this levy is a short term solution to the long-term energy challenges businesses and consumers continue to face.
“Rather than supporting investment in decarbonisation and energy security, this levy will only serve as a sticking plaster for rapidly rising bills, does little to support businesses and is ultimately a short sighted and opportunistic policy from the Treasury.
“With yet again no additional financial support announced for SMEs, this was another missed opportunity by the Chancellor to introduce a SME energy price cap or address the rising costs of doing business that is now dragging on economic growth.”
Commenting, Ryan Crighton, Policy Director at Aberdeen & Grampian Chamber of Commerce, said:
“Where the industry, the Chancellor and Prime Minister agree is that a windfall tax will deter investment in both the North Sea and our energy transition. All three have been repeating that mantra for months now.
“In the short-term, taking an additional £5billion from a sector already taxed at 40% will achieve very little apart from making the North Sea – already one of the world’s most mature basins – less attractive to investors. Tax and fiscal stability, above all else, are what really matter in a globally competitive investment market, and today we’ve shot ourselves in the foot.
“It is clear that the Treasury has benefited enormously already from higher energy prices, to the tune of £19million per day so far this year, and therefore offering targeted support to consumers and businesses was already within its gift, without this damaging additional tax raid, which needlessly puts obstacles in our path to net zero and will increase our reliance on imported energy at a greater environmental and financial cost.”
The short Chamber business survey allows you to share live feedback on current trading conditions as well as challenges being faced by your business.
Your feedback directly informs our work at a local and national level, sharing the issues being faced by the business community with policymakers at Holyrood and Westminster. Over the past two years, we have used these views to secure vital business support, quicken the easing of COVID-19 restrictions and be the voice of business in Scotland.
The latest survey received significant coverage in the media, highlighting that companies are becoming increasingly anxious about their prospects in the face of complex economic challenges.
These include the war in Ukraine, labour market shortages, international supply chain disruption, soaring energy prices and inflation which all threaten to hamper the recovery from the COVID-19 pandemic.
The survey was covered by the BBC, STV, The Times, The Scotsman, The Herald, and the Press & Journal.
We hope you can take just a few minutes of your time to share your views, by taking our survey today and keeping us informed. Complete the survey now using this link.
Please consider sharing your insights with us today, so that we can continue to be your voice locally as well as at Holyrood and Westminster.
Increasing pressure is mounting on Scottish businesses as the cost-of-doing-business crisis hits the bottom line, according to the latest findings from a leading Scottish business survey from the Scottish Chambers of Commerce (SCC).
Firms have reported record levels of concern over inflation and rising cost pressures as the economy restructures following the impact of the Covid-19 pandemic, creating complex challenges for Scottish businesses.
Adding to the pre-existing obstacles facing businesses, linked to persistent labour market shortages, international supply chain disruption, soaring energy prices and an increasing tax burden, Scotland’s economy is entering into a period of increased uncertainty.
Businesses are starting to feel the impact of reduced spending as consumers tighten their belts and disposable income drops, hitting many firms cashflow and profits, particularly in the tourism and retail sectors where recovery remains lethargic.
With inflation reaching a 30-year-high, the rapid return to economic growth seen following the removal of Covid-19 restrictions is now plateauing with firms being forced to make tough decisions around investment, recruitment, and price rises.
The situation in Ukraine is also deepening business concern with many continuing to seek advice, information and support to make decisions, adapt to rapidly changing circumstances and navigate the challenging times ahead with further international trade disruption likely.
KEY FINDINGS:
- Record Concern Over Inflation: With UK inflation reaching 5.5% earlier this year, the negative impact on businesses is becoming increasingly clear with all sectors of the economy reporting record high levels of concern. The financial and business services sector (FBS) reported a 15% increase and the tourism sector a 14% increase from Q4 2021 respectively.
- Cashflow Crunch and Profits Plummet: Businesses continue to report significant cashflow and profit challenges, with high inflation a key driving factor. The construction, retail and tourism sectors all reported decreases in both cashflow and profits, highlighting the impact of rising cost pressures, leaving businesses at increased risk from economic shocks.
- Growing Cost Pressures: Across all sectors, business cost pressures have increased. Raw material prices, rising energy costs, increased tax burdens and other overheads are leading pressures. Energy price rises and the ongoing global supply chain disruption are cited to be the primary contributing factors to these increases.
- Consumer Price Rise: In response to rising cost pressures, a record 7 in 10 firms have indicated that they intend to raise the prices that they charge for their goods and services. This is likely to deepen inflationary challenges and further increase the cost-of-living.
- Retail and Tourism Remain Vulnerable: Despite the continued easing of COVID-19 restrictions over the first quarter of 2022, firms in these sectors have still reported concerning figures for both sales and investment. Retail footfall remains considerably below pre-pandemic levels due to changes in office work patterns and the removal of international travel restrictions have cooled the staycation market.
Stephen Leckie, President of the Scottish Chambers of Commerce said:
“Despite a period of relatively strong growth, the latest Scottish Chambers of Commerce business survey reveals that growth is now levelling off as the complexity of the challenges facing Scotland’s businesses start to take hold.
“Firms are becoming increasingly anxious about rising inflation, energy prices and cost pressures. For too many businesses, the focus is still simply on survival.
“Businesses who have weathered the pandemic over the past two years are now seeing problems pile up, one on top of another, as they struggle with longstanding challenges linked to recruitment, planning and managing change and are now being hammered by surging energy prices, inflation and falling consumer spending.
“Consequently, Scotland’s businesses are making serious adjustments to operating models and grappling with difficult decisions on whether to absorb price rises or pass them onto the consumer. Business finances are also being squeezed by Coronavirus Business Interruption Loan Scheme repayments, rising interest rates and significant business insurance cost rises.
“The prospect of impending additional tax burdens such as the Workplace Parking Levy, Transient Visitor Levy (Tourist Tax) and the Deposit Return Scheme are further cause for concern amongst already hard-pressed businesses.
“Economic growth is now plateauing because of these rising inflationary and cost pressures creating an increasingly uncertain outlook for businesses, with international trade and the global economy remaining volatile.
“With continued disruption to international trade due to the war in Ukraine, energy prices expected to rise again later in the year and inflation likely to remain resurgent, businesses will be forced to increase prices further, cut back on investment and protect their cashflow and profits to enable them to cope with any additional economic shocks.
“Scotland is approaching a critical point in recovery. Businesses are struggling now.
“That is why the Scottish and UK Government’s need to urgently rethink the impact of new and increased taxes on business if the economy is to be given the headroom it needs to survive this crisis and grow.”
On business support:
“Businesses are still grateful for the financial support and assistance provided by both the Scottish and UK Government’s over the course of the pandemic, however, now is not the time to pull the rug out from under the business community.
“Business support needs to be reset and realigned with the economic reality. Businesses need support now and Government intervention must protect the recovery that businesses have worked hard to secure.
“As a priority, the UK Government should seriously consider the introduction of an SME energy price cap to protect smaller firms from some of the major energy price increases, in the same way that households have been supported.
“The Chancellor missed an opportunity in the Spring Statement to deliver for businesses and the subsequent National Insurance increase has been yet another hammer blow for Scottish businesses adding millions to an already heavy tax burden.
“Without meaningful support, businesses will have little option but to raise prices, increasing pressure even further on business and household finances.”
On retail and tourism:
“Scotland’s retail and tourism sectors desperately need additional support from government as their recovery is lagging other parts of Scotland’s economy.
“Both sectors have been amongst the worst hit by the pandemic and the subsequent changes in consumer behaviours. They are also the most likely sectors to operate to tight cashflow and profit margins, and that’s why urgent support is needed now.
“Sustained business support and rethinking the removal of Covid-19 business rates and VAT relief by both Scottish and UK Governments is necessary to facilitate recovery and avoid businesses going to the wall at this critical point in Scotland’s economic recovery.”
Commenting on the results, Mairi Spowage, Director at the University of Strathclyde’s Fraser of Allander Institute, said:
“Two years on from the first lockdown, it would be great to be optimistic about the economic prospects for 2022. Unfortunately, global uncertainties and the cost-of-living crisis, which are not unrelated to each other, have doused that enthusiasm with a bucket of cold water.
“Despite the impact of Omicron in December, the economy is now (as of data in January) back above pre-pandemic levels of growth. This milestone in the recovery is of course important: but seems less heartening than it might have done a few months ago given the wider economic conditions.
“Current data suggests that the experience of input price rises for businesses is running at more than double the consumer inflation rate. And as much as many businesses are trying to avoid passing price rises onto customers, something may have to give for tight margin businesses.
“This may mean that these cost pressures may continue to feed through to prices experienced by consumers as more businesses face difficult choices.
“In the face of all these headwinds, it can be difficult not to be gloomy about the prospects for growth in 2022. The Scottish business base has shown incredible resilience through the last couple of years, and was looking forward to a strong Spring and Summer as we look to operate without COVID-related restrictions.
“In line with this resilience, it is important to highlight that these results today show positivity for 2022 despite all these challenges. It will be interesting to see how this positivity evolves as we progress through 2022.”
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Following a long campaign for the return of lifeline air services to Wick John O’Groats Airport, Caithness Chamber of Commerce is celebrating the successful first flight of the Wick-Aberdeen Public Service Obligation (PSO).
The service, which started on Monday 11 April, will offer a new deal for air passengers in the North Highlands, with a guaranteed pricing structure and strong onward connectivity to both domestic and international destinations.
The Chamber was the initial driving force behind the business case for a PSO from Wick, and worked alongside other partners in the Caithness & North Sutherland Regeneration Partnership to help secure funding for the service of just over £1m per year for three years from Scottish Government and the Highland Council.
Members of the Chamber team including Trudy Morris, Chief Executive, were on the inaugural flight from Wick to Aberdeen and used the opportunity to begin forging links with key organisations in Aberdeen to help drive traffic both to and from the North Highlands. Productive discussions were held with Visit Aberdeenshire, P&J Live, and the Aberdeen City and Shire Hotels Association.
Trudy Morris, Chief Executive of Caithness Chamber of Commerce, said:
“The return of lifeline air services to Wick John O’Groats Airport has been one the highest priorities of the Chamber for a number of years, and I am delighted to see our efforts, and those of our partners, bear fruit. It has been a long, hard road to get here and it would not have been possible without the tireless efforts of partners across the region. These flights are a real testament to what can be achieved through partnership working between the private and public sectors.
“Our thanks go to the Scottish Government for committing the funding that made this possible, and to the Highland Council both for their direct financial contribution and for all of their hard work in designing and procuring the service.
“The return of flights marks a starting point, not an ending. Air connectivity remains vital to businesses and communities across the North Highlands and the Chamber, along with partners, will continue to work for the further development of of lifeline connectivity to and from the region.
“We would now encourage everyone to make use of these flights – this is a service designed for everyone and offers great options for both business and leisure travel. The timetable already offers a good range of connectivity to domestic and international destinations and, as the aviation industry recovers post-COVID, this will only improve further.”
Book flights now using this link.
From left to right. Dougie Cook, North Airports General Manager, Lorna Jack, Chair of Highlands and Islands Airports ltd, Trudy Morris, CEO Caithness Chamber of Commerce, Ellie Lamont, Vice Chair of Venture North, Louise Sinclair, Vice Chair of Caithness Chamber of Commerce and Gordon Duncan, Highland Council
Caithness Chamber of Commerce was delighted on Tuesday 29th March to host a business breakfast allowing businesses of all sectors across the North Highlands to learn more about upcoming opportunities in the space industry.
Hosted in partnership with Space Hub Sutherland and Highlands & Islands Enterprise, the event gave attendees the opportunity to hear from Roy Kirk, Project Director at Space Hub Sutherland and Mark Thornell, Procurement Manager at Orbex about the exciting developments moving forward in the region and the opportunities for the local supply chain to get involved.
Attendees heard about the significant potential for growth in the sector, with hopes that it will be worth up to £4bn to the Scottish economy by 2030, and the significant opportunities available in the North Highlands thanks to the development of the vertical launch spaceport at A’ Mhòine in Sutherland.
Roy Kirk gave an overview of the background to the Space Hub Sutherland project, noting the many benefits of the decision to site the spaceport in the region, from good access to orbits to a supportive local environment. Mark Thornell gave attendees an overview of the types of supply chain opportunities that Orbex has already been able to offer to Scottish companies as well as potential opportunities that may arise in the future.
Trudy Morris, Chief Executive of Caithness Chamber of Commerce, said:
“It is clear from last year’s report on the potential for a North Highland & Moray Space Cluster that the North Highlands has huge potential both to contribute to and to gain from developments in Scotland’s thriving space sector. We were very pleased today to be able to give local businesses a greater insight into the economic opportunities that are upcoming in the area as a result of these developments.
“The North Highlands is home to a highly skilled local supply chain with expertise in a range of complex and highly regulated sectors and the Chamber is in the final stages of producing a supply chain directory to showcase the skills available in the region. We look forward to continuing to work closely with local partners to promote and support the development of the space sector within the North Highlands”.
Roy Kirk, Project Director, Space Hub Sutherland, said:
“The development of Space Hub Sutherland has already benefited from community and business support. We have had several large Aerospace companies and Space companies who have visited the area and have positively remarked on the high standard of support that they have received here.”
Chris Larmour, CEO of Orbex said:
“Orbex is at the forefront of the Scottish space industry and is focused on building the world’s most environmentally friendly space rocket to launch small satellites into low-earth Orbit from our home spaceport in Sutherland. These satellites will provide a range of new services – everything from providing rural connectivity to monitoring the impact of climate change. We have rapidly expanded our operations in the north of Scotland in recent years, putting local people from the area at the heart of this exciting new industry, and we are committed to engaging with local communities and businesses to keep them and informed about opportunities to work with Orbex, and help build a truly local supply chain wherever we can.”
The Baillie Wind Farm Community Benefit Fund (BWFCBF) would like to remind potential applicants that its next round of funding closes soon, with an application deadline of 5pm on Monday 11 April 2022.
The Fund is open for applications through its regular funding stream, which is open to residents, businesses and community organisations within the West Caithness Community Council area, as well as to educational and sporting organisations throughout Caithness.
Over the past year, the Fund has awarded over £108,000 in grants to help community and sporting groups, help businesses expand, and support residents with the installation of micro-generation. Just some of the projects supported have been Bower Busy Bees, National Sheepdog Trials, Pennyland Primary School, Reay Golf Club and village halls across the West Caithness area.
Anybody interested in making an application should contact the Fund on 01847 500105 or email enquiries@bailliecommunityfund.org.uk
We would like to thank everyone who applied, this position has now been filled and we look forward to welcoming a new team member shortly.
Caithness Chamber of Commerce is a membership organisation with 220 members. The Chamber is an active business organisation with a proven track record of delivery and professionalism. Some of its activity includes but is not limited to: Delivering business services to members, organising and hosting events, seminars and workshops, lobbying and campaigning on key issues facing local businesses and the area, chairing stakeholder meetings/forums, delivery of commercial contracts and an active involvement in the socio-economic development and promotion of the area.
To support this work, Caithness Chamber of Commerce is recruiting an Office Administrator. The role will be flexible for the right candidate. Caithness Chamber of Commerce operates a hybrid working model. The successful applicant will be required to work at least 50% of their time in the office based at Naver Business Centre, Thurso.
The key aim of the post is to assist the Chief Executive and Chamber team and provide an efficient administration service. The following key
tasks will be undertaken to achieve this:
- Bookkeeping, budgeting and billing cycles for the business
- Provision of general office support services
- Support for client contracts
- Filing and maintenance of records
- Assisting in the development and maintenance of effective administrative procedures and systems appropriate to the needs of the Chamber
- Other duties as determined by the Chief Executive
This is not an exhaustive list but a guide to the role.
The ideal candidate will have two years experience in a similar role and be educated to HNC level in Business Management or Accounting. To see the full job description, sign up or log in to the Recruit North Highlands website using this link. Informal enquiries can be made to Trudy Morris via recruitment@caithnesschamber.com
Commenting on the Scottish Government’s publication of Scotland’s National Strategy for Economic Transformation, Dr Liz Cameron CBE, Chief Executive of the Scottish Chambers of Commerce said:
“Scotland’s businesses will applaud the scale and ambition set out in the strategy, which has the potential to live up to its name and truly revolutionise the Scottish economic landscape over the next decade.
“The Strategy is a strong starting point for transformation and businesses of all sizes and from all sectors will step forward to help support the initiatives set out to drive forward the renewal of Scotland’s economy.
“By working in partnership, businesses and government can become better positioned to dial up Scotland’s economy by several notches, creating the jobs, opportunities and trading conditions that will drive an increasingly entrepreneurial, wealthier and greener Scotland.
“The key test for the Scottish Government and it’s agencies however will be to demonstrate they can effectively work with businesses to deliver meaningful change. Delivering Scotland’s economic transformation will be a collective effort and Scotland’s businesses have the skills and expertise to deliver growth, however, the public sector must create the environment to allow this to happen.”
On talent and skills:
“The renewed focus from the Scottish Government on developing Scotland’s workforce and the proposal for a new Skills Pact is welcome.
“Businesses can’t achieve their full potential without access to a skilled workforce. Skills sit at the heart of the challenges facing Scotland’s economy, and government need to focus on upskilling, reskilling and making certain that training providers are driven by the needs of business. A culture shift that openly engages individuals and institutions to ensure access to training opportunities will be key to delivering real transformational change.
“With nearly a quarter of the country’s working age population economically inactive, it is essential that we do better to establish viable routes back into work for those who have not had the opportunities that they deserve and need.
“Also ensuring Scotland has access and the ability to attract talent from the rest of the UK is essential to keep our economy competitive and plans to expand Scotland’s talent pool and reach will have a positive impact.”
On Scotland’s just transition:
“Ensuring that there is ongoing government support backed up by sensible policies as our economy transitions to diverse energy supplies, developing new business models, all enabling businesses to lead towards a practical Net-zero future will be crucial.
“Scotland has the opportunity to strengthen our place as a world leader in renewables and there is much to welcome in the strategy that will boost the sector and support businesses to deliver a fair and just transition, that protects jobs and communities.”
On international trade:
“Scotland is already internationally recognised as a producer of high-quality goods and services, however we all recognise the need to go further, readjusting to a new global trading reality.
“It is right that Scotland’s international outlook has been recognised in the Strategy and we need to ensure continued and growing investment if we are to achieve our ambitions. Competition is growing internationally and Scotland has much to offer if we support our people and products onto the global stage.”
On increased conditionality:
“The majority of Scotland’s businesses support the principles behind the Scottish Government’s Fair Work focus. However, we have many businesses who are supportive, but need additional time and support in redesigning their businesses models in relation to both affordability and sustainability. The real-life impact of conditionality on businesses needs to be considered to ensure no business is left behind as our economy adjusts to the aims set out in the Strategy.
“Businesses need the time and support to recover and keep trading whilst navigating the challenges of rising business costs and economic uncertainty. It’s crucial the Scottish Government put in place adequate support to help businesses transition, remodel and ensure they are supported in meeting the Fair Work agendas ambition.”