Following the announcement that a further £1.1 billion in COVID-19 funding will be allocated to the Scottish Government from the UK Treasury, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce said:
“We need the Scottish Government to engage with business as soon as possible to ensure that this funding is allocated appropriately to support businesses urgently. We must see every penny released quickly without delay. Businesses and jobs face catastrophe otherwise.
“This funding also needs to be aligned with a plan to ease restrictions. This must be done in a way that is directly linked to getting as many businesses back open as much as possible. Having the means to plan to re-open is our only hope and will be crucial to supporting businesses to rebuild our economy which has been devastated by the pandemic.’’
Commenting on the latest UK GDP figures published today by the ONS, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce, said:
“Stronger than expected growth of the UK economy in the final quarter of 2020 was only the slightest reprieve. A temporary boost from the release of pent-up demand in December and Brexit stockpiling was a brief offset to the squeeze on output from the November lockdown.
“There is little to cheer in the latest data. Despite avoiding a double-dip recession, output is still well below pre-pandemic levels. What these figures confirm is that 2020 was a historically bleak year for the UK economy.
“Modest growth at the end of 2020 is set to be followed by a substantial fall in output in the first quarter of this year as the current lockdown, the unwinding of Brexit inventories and disruption to UK-EU trade flows combine to suffocate activity. Many Scottish businesses have already encountered severe problems with the new EU – UK trading arrangements, particularly in our invaluable food & drink sector.
“While the vaccine rollout offers some scope for optimism, the scarring caused by the pandemic is likely to crystallise as government support winds down. This as well as the prospect of persistent post-Brexit disruption means any recovery may be slower than the Bank of England currently predicts.
“The current drip-feed approach to support measures means firms cannot plan for more than a few weeks ahead and jobs in Scotland will continue to be lost without intervention. We need businesses to survive if the economy is to eventually recover. It is critical that the government swiftly implements a package of measures that support businesses and the economy for the whole of 2021, including removing the cliff-edges for business rate reliefs, VAT deferrals and furlough.”
Following the announcement of the creation of a £20 million SME Brexit Support Fund from the UK Government, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce, said:
“Many Scottish businesses have already encountered severe problems with the new EU – UK trading arrangements, particularly in our invaluable food & drink sector. At a time when they are already dealing with restrictions on how they can trade due to the pandemic, trade disruption threatens many of our flagship exports.
“While this announcement is a welcome start and recognition from the UK Government that SMEs need financial help, greater support will be needed if businesses are to successfully navigate the new administrative barriers to trade that they now face.
“The UK Government must act now and fast to distribute this fund as quickly as possible – SMEs cannot afford to wait weeks and weeks at this time.
“Local Chambers across Scotland and the UK are standing by to offer direct support with customs and trade.”
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Following the announcement of the extension of current lockdown measures in Scotland to at least the end of February, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce, said:
“It will come as little surprise to Scottish businesses that restrictions will be in place for at least the rest of the month. Many will be disappointed that non-essential shops will remain closed, not least because of the immense investment the sector has made so they are safe for employees and customers.
“We continue to urge the Scottish Government, local authorities and agencies to speed up the release of vital business support funds. This is essential to provide cashflow support to businesses that have been forced to close. Ultimately, the best route to support the economy is to re-open. That’s why we urgently need an economic roadmap to recovery, that outlines clear conditions and timelines for reopening sectors of the economy if we are to protect businesses and jobs.”
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Following the announcement of the Scottish Budget by Cabinet Secretary for Finance Kate Forbes, Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce, said:
“The position of Scottish businesses has never been so precarious. The Scottish Government’s announcements today are welcome but do not go nearly as far enough to avoid risk of widespread business collapse and job losses.
“Yes, there is light at the end of the tunnel with the vaccination programme but restrictions to prevent the spread of the virus have been devastating. We understand that the Cabinet Secretary for Finance faces difficult choices in setting the budget particularly ahead of that of the UK, in a time when the country faces extraordinary challenges.
“Business will be disappointed that further details on an economic route map on how we will exit this crisis aligned with the roll out of the vaccine were not provided today. This is a critical component if businesses are to unleash the investment our country so desperately needs.”
On Non-Domestic Rates:
“The Cabinet Secretary has listened to us and has delivered a reduction in the Non-Domestic Rate (NDR) poundage rate. However, longer-term, we believe the system is rotten and needs significant reform.
“Plans for a three months extension of rates relief is a too short a reprieve. We need commitment to a 12-month reliefs package to provide the certainty business needs. Clearly there is more to do, and we await further announcements from the Chancellor to see what further support can be made available and expect Scottish Government to pass on the equivalent consequential funding to businesses.”
On Business Support:
“The doubling of the discretionary fund is good news particularly for those businesses who have fallen through the gaps of other support packages. However, it is imperative that the process for businesses is clear, transparent and quick across all local authorities to ensure funding is available for businesses quickly and immediately.
“Now is the time to pull out the stops and redouble efforts to ensure business support comes through. We need to see a significant ramping up to get those funds that have been promised out the door and to businesses.”
On Infrastructure:
“The Scottish Government’s commitment to infrastructure investment is absolutely necessary for Scotland and the UK to be in a position to build back better and meet net zero ambitions. Now is the time for a vision driven by ambition and a willingness to collaborate like never before. This must be put first and foremost ahead of any political point scoring this year.”
On skills and training:
“SCC welcomes these important steps to support jobs, employment and training. We called for training academies and we are pleased to see the Cabinet Secretary has acted on our recommendations, particularly the focus on green jobs. It is now critical that the government and academia works in partnership with the private sector to ensure benefits are fully realised.”
On Protecting Jobs:
“We maintain our call to the Chancellor of the Exchequer to extend the furlough scheme beyond April 2021 and outline further initiatives to protect business and jobs at the UK Budget in March.”
On mental health support:
“Business will welcome this as we understand the toll the pandemic has taken on our customers, employees and communities.
“Recovery of our wellbeing is just as important as economic recovery, with many employers investing in their own employee support programmes. This commitment from the Scottish Government will enhance these efforts.”
The year started in the way it ended, with further restrictions to combat COVID-19. While difficult but necessary, the national vaccination programme offers hope, and we can begin to look at how we build back the Scottish economy.
Further redundancies are looming, and recent analysis by Highlands and Islands Enterprise found that unemployment is increasing faster across the region than the rest of Scotland. This situation will exasperate long-standing challenges of depopulation and inward investment and is made more serious by the absence of scheduled air services from Wick John O’Groats (WJOG) airport since last year.
North Highland communities live in some of the most remote places in the UK. The airport and the connections it provides make the area a more attractive place for businesses to relocate, bringing jobs and valuable investment.
Prior to COVID-19, we saw a steady degradation of airline services, and so developed a business case for a Public Service Obligation (PSO), a robust document which remains with Scottish Government. In this, we argued for investment to help deliver twice daily flights to Aberdeen and Edinburgh to address this situation, one that now poses a significant risk to the region’s economic recovery and longer-term potential.
Without lifeline air services, investment in the region may be lost, as businesses chose to relocate to parts of Scotland with stronger regional connections. This is not an imagined reality, as one multi-national company recently decided to cease operations at Wick Harbour, citing the lack of scheduled air services as a major factor.
The PSO is a shovel-ready infrastructure project that aligns with core Scottish Government policy objectives. The forthcoming budget statement provides government with the chance to commit to playing its part in our regions’ post-pandemic future.
If Scottish Government were to commit to the PSO, it would help ensure the North Highlands has equity with the rest of Scotland in terms of connectivity, social inclusion, and inward investment.
This will be strategic investment, driving the economic recovery of the region, and helping achieve the Scottish Government’s net-zero targets in the Highlands and Islands. It would support our transition away from economic reliance on the Dounreay nuclear site, and into new growth areas such as renewable energy. This is the very type of energy and economic transition Ministers regularly talk about on a national level.
Such an opportunity can only be secured with the necessary investment, which is estimated to be £3 million, a relatively small figure given the future benefits it will accrue.
While many parts of Scotland are struggling right now, this initiative will give businesses critical support, regional links to the rest of the country and help secure future investment.
However, this can only become a reality if the Scottish Government commits to this future, and helps drive economic growth, invest in Scotland’s infrastructure, and deliver a green recovery – helping our region grow and succeed for years to come.
This article was published in The Scotsman on 26/01/21. See it here.
Commenting on the Scottish Government’s “green ports” proposals, Dr Liz Cameron OBE, Chief Executive, Scottish Chambers of Commerce, said:
“Scottish business welcomes the Scottish Government’s plans to develop sustainable green ports to aid economic recovery. Whilst we await further detail from the Government, it seems they have listened to the key asks from business including the provision of investment incentives and a package of tax and customs reliefs. Now, we will want to engage with Government on the design and delivery of green ports in Scotland.
“Businesses needs all the tools in our toolbox to enable us to grow and to compete with freeport models across the globe. Scotland’s green ports approach, which couples the incentives of a UK-freeport model and Scotland-specific initiatives, has the ambition to drive business growth and job creation. This is an important step to ensuring Scotland remains attractive and competitive to domestic and international investors.”