Genuine opportunity for business but momentum at risk of stalling
These decisions will help cement Scotland's place at the cutting edge of global industries as well as generate jobs, boost regional economies, and spur commercialisation of ideas born in our world-class universities.
The UK Government's plan to increase defence spending from 2% to 2.5% of gross domestic product (GDP) by 2027 also represents a significant economic opportunity for Scotland to expand the industrial base and create jobs in productive industries like advanced manufacturing.
Our aerospace, defence, security and space sectors provide 430,000 jobs and the Acorn Project carbon capture and storage facility will create 15,000 more in construction alone - as well as making the Northeast a world leader in the low-carbon industry and attracting billions in private investment.
By focusing on high-growth sectors like carbon capture, information technology (IT), biotechnology and life sciences, as well as increased defence spending, the Government is signalling the right priorities.
Alongside the additional £2.9bn allocation for Scotland through the Barnett Formula, it's another shot in the arm for industrial growth. Scotland's businesses will be buoyed by the potential this unlocks.
The UK Government's Modern Industrial Strategy, published last week, reinforced these investments with a plan ready for implementation. Scottish Chambers of Commerce (SCC) has long called for a joined-up approach to developing our major industries, and last week the Government indicated it was listening, giving a vote of confidence to Scotland's manufacturers and innovators.
But let's be clear: without urgent, coordinated reform, this good news could be squandered if the headaches businesses face every day are not resolved:
Soaring operational costs, including the hike in employer national insurance contributions (NICs) and the highest energy bills in Europe
Inadequate business rates support, hitting our struggling high streets and the hospitality sector hardest
The bureaucratic burdens and constraints in planning blocking progress on infrastructure projects and private investment
The huge staffing and skills shortage thwarting our ambitions and ability to grow to meet current and future demand
The Spending Review commitments can put the UK economy on a pathway to growth, but it's clear the Treasury needs more financial flexibility to invest in long-term assets such as transport, infrastructure, connectivity and logistics. The Chancellor should heed calls from the International Monetary Fund and leading economists to review the Government's fiscal rules.
Read more
Closer to home, it was encouraging to hear the First Minister, John Swinney, affirm his commitment at the Scotland 2050 conference to align policy with economic opportunity. Business desperately needs clarity and leadership, and we are starting to see this approach bear fruit. Earlier this month, EY reported that one in six UK investment projects were based in Scotland, underlining our nation's structural attractiveness to investors, second only to London.
However, spending promises on building projects and transport infrastructure will amount to empty words without the necessary reforms to get the system moving at pace. Why does it currently take 58 weeks to process a planning application in Glasgow, yet just 16 weeks in Manchester? Worryingly, we are also forecast to need 700 additional planners to meet market demand with no clear plan to meet that number anytime soon.
The cost of building is higher in Scotland than the rest of the UK, largely because of the Scottish Government's higher regulatory standards. Whilst this may be well-intentioned, some regulations are clearly becoming an impediment to growth. Strategic thinking is required to balance sensible regulation against economic necessity.
Smart reforms are also needed across the public sector to ensure best practice and streamlined and simplified processes are aligned with key business priorities.
These are all critical areas we must address if we are to maximise the opportunities for jobs and economic growth offered by the Spending Review. We simply have to take this positive momentum and capitalise on it.
Read more
The Scottish Government also outlined its budget priorities last week, pledging to expand borrowing for capital spending in construction and renewables, but with a welcomed emphasis on public sector reform. The Finance Secretary has expressed her intention to maximise every penny of investment through efficiencies and technical improvement, boosting productivity in the long term. This is something every sector of the economy stands to benefit from.
While Scottish Government spending is significantly shaped by the Barnett Formula, which ensures that a population-based adjustment is made to align spending in devolved areas such as health or education, the Scottish Government has outlined clear priorities and a direction of travel to business.
Westminster and Holyrood must now work in close collaboration to support these investments with a laser focus on delivery, removing obstacles to growth and finding solutions for businesses weighed down by spiralling costs and excessive regulation.
The Scottish Chambers of Commerce and our Network are ready and willing to work in partnership with governments and help businesses navigate the business challenges and economic opportunities. Collaboration is the key to secure the growth and jobs we so badly need.
Liz Cameron is chief executive of the Scottish Chambers of Commerce
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
2 minutes ago
- The Independent
New Zealand will spend $1.6B on military aircraft in a plan to double the defense budget
New Zealand 's government announced new military spending Thursday of 2.7 billion New Zealand dollars ($1.6 billion) to replace aging aircraft, with senior officials who unveiled the package citing rapidly growing global tensions and a deteriorating security environment. The purchase of military planes and helicopters was the first procurement announced in a government plan, disclosed April, to double defense spending from 1% to 2% of GDP in the next decade. New Zealand's military spending has trailed that of its larger partners in the Five Eyes intelligence sharing group of countries — which includes the United States, Britain, Canada and Australia — and the bolstered budget reflects a shift in how the remote island nation is responding to strategic competition between major powers in the Pacific Ocean. The procurement includes five MH-60R Seahawk helicopters to replace the existing maritime fleet and two Airbus A321XLR aircraft, allowing the retirement of Boeing 757s that are more than 30 years old and were already secondhand when purchased. The helicopters accounted for more than NZ $2 billion of the spending, officials said. Defense Minister Judith Collins said her government would 'move at pace' to procure the helicopters directly through the United States' foreign military sales program instead of going to a wider tender. Cabinet ministers were expected to consider the final business case in 2026, she told reporters in Wellington on Thursday. It would take 'a few years' to acquire the helicopters, Collins added, because buying new meant New Zealand would need to 'wait in line.' She denied the choice to buy from the United States was an attempt to rectify the trade imbalance that has seen New Zealand goods targeted for an adjusted 15% levy when arriving in the U.S. under the Trump administration's global tariffs plan. The aging Boeing aircraft have frequently broken down while transporting New Zealand prime ministers abroad in recent years and now can only be flown short distances. The episodes are among an awkward string of incidents that have highlighted the rundown state of the country's military hardware and persistent difficulties in maintaining it due to recruitment shortfalls.
Daily Mail
33 minutes ago
- Daily Mail
Revealed: The STAGGERING amount of money Aussie taxpayers will have to fork out to pay for the Brisbane Olympics
Many Aussie taxpayers can't wait for the Brisbane Olympics to begin in 2032 - but they won't be happy to hear they'll be forking out more than $7billion to host the Games. Under a deal struck with the Queensland government, the Commonwealth has agreed to contribute just under half the cost of building when it comes to Games venues and other infrastructure. The federal government will provide $3.43billion for 17 new and upgraded venues for the Games - with the whole bill forecast to cost $7.1billion. Given the long track history of Olympics being subject to huge cost overruns, the eventual total could be far in excess of that. A large proportion of federal government's contribution will be spent on the new 63,000-seat stadium at Victoria Park as well as a 25,000-seat National Aquatic Centre in Spring Hill. In total, 37 venues across 11 Queensland cities will be used to host the 28 Olympic and 22 Paralympic sports. But given some sports won't be determined until an International Olympic Committee (IOC) meeting is staged next year, Games organisers will be forced to create a venue plan while not knowing what sports they are hosting. At the LA Olympics in 2028, there will be six additional sports: cricket, baseball, flag football, lacrosse, squash and softball. In March, Premier David Crisafulli apologised to Queenslanders for breaking a major election promise after announcing the construction of a new stadium as part of Brisbane's $7billion plan for the 2032 Olympics. Crisafulli repeatedly pledged not to build any new stadiums on the campaign trail in the lead-up to last year's state elections. 'It became a choice between the embarrassment of hosting the games at [the run-down Queensland Sport and Athletics Centre] or a new stadium at Victoria Park,' he said earlier this year. 'In the end, the choice was clear. The Games must be held at a new stadium at Victoria Park.' Crisafulli was asked how he planned to respond to claims he had back-flipped on his earlier promises. 'By being honest and copping that on the chin,' he conceded. 'I have to own that, and I will, and I am sorry. (But) it is my decision.' Following the Olympic and Paralympic Games, the new stadium will host home games for the Brisbane Lions and Cricket Australia matches. Brisbane won the rights to host the 2032 Games four years ago when the International Olympic Committee stated the city was its 'preferred candidate' based on its previous successes in hosting international sporting events.
Powys County Times
an hour ago
- Powys County Times
Majority of public back housing and developments in their area
A majority of people back the idea of new housing or developments where they live, new data has indicated. The poll of 2,005 people conducted by Public First in July found that 55% of respondents would 'generally support new buildings or developments or buildings being built in my local area'. The research found that Labour backers (72%) and young people aged 25-34 (67%) were most likely to be 'Yimby' (yes in my backyard). Reform backers (44%) and people in the East of England (44%) were the most likely groups to say that they generally oppose development in their locality, the poll found. Overall, 33% of people said that they would generally oppose development. Sir Keir Starmer has pledged to put 'builders not blockers first' and 'overhaul the broken planning system'. In December, the Prime Minister announced new mandatory targets for councils when it comes to housebuilding. He said at the time: 'Our plan for change will put builders not blockers first, overhaul the broken planning system and put roofs over the heads of working families and drive the growth that will put more money in people's pockets.' In its report, The Quiet Yes, released on Thursday, Public First argued that a 'more representative planning system' is needed. The policy research organisation recommended that councils bring in changes to surveys and research on public opinion on building plans and questions about how residents would want councils to spend certain money earmarked for development. Jack Airey, director of housing and infrastructure at Public First, said: 'Most people instinctively support new development, yet their voices go unheard. 'Our research finds the public understand the housing shortage and back new homes, but the planning system doesn't reflect that reality. 'Councils and Government should build on this majority view, creating a representative planning system that unlocks support for new homes and the infrastructure communities need.' Deputy Prime Minister and Housing Secretary Angela Rayner has said that Labour are 'overhauling the broken planning system'. She said: 'With investment and reform, Labour is delivering the biggest boost to social and affordable housing in a generation, unleashing a social rent revolution, and embarking on a decade of renewal for social and affordable housing in this country.'
