10-year economic plan signals major change in Scottish government’s strategy

The National Strategy for Economic Transformation, unveiled by finance and economy secretary Kate Forbes, sets out the Scottish government’s vision of a “wellbeing economy” that is “thriving socially, economically and environmentally.” The plan focuses on five areas: entrepreneurial people and culture; new market opportunities; productive businesses and regions; a fairer, more equal society; a skilled workforce and a culture of accountability.

Scott Wright, Scottish affairs expert at Pinsent Masons, said: “The strategy represents a strong shift in the Scottish government’s approach to developing the economy. It demonstrates a key focus on fostering the support of the private sector to drive Scotland’s post-Covid economic transformation and facilitate improvements within the public sector.”

The strategy, developed in conjunction with an advisory council comprised of business leaders, academics, economists and trade unionists, would see the appointment of a “chief entrepreneurship officer” in the Scottish government. A new national system of “pre-scaler hubs” would also be launched to help new businesses with high growth prospects access support and advice as well as a new “national challenge competition for economic transformation”.

Under the plans, first minister Nicola Sturgeon would chair a new investor panel, designed to attract investment to a pipeline of projects in Scotland that support its transition to net zero. Forbes also pledged to establish a “high integrity” market for responsible private investment in natural capital, deliver on the ambitions of ScotWind and future renewable energy developments, and expand the capacity of Scotland’s supply chain.

In an effort to boost productivity, the strategy outlined a new “centre for workplace transformation” to support experimentation in ways of post-pandemic working, “a lifetime upskilling and retraining offer” that will be more straightforward for workers and businesses to access, and a new skills guarantee for workers in carbon intensive industries.

Forbes also announced that a ‘fair work’ condition would apply to future Scottish government grants - requiring recipients to pay the real living wage – and promised to establish a “centre of expertise in equality and human rights” within the administration. She said the employability system would be simplified by implementing a “no one left behind” approach, focused on giving individuals the right support to help improve their life chances.

The national strategy also included reforms to create a culture of delivery and accountability, including the restructure of existing Scottish government boards to create one co-chaired by Forbes and a figure from the private sector. A “wellbeing economy monitor” will also be published under the plans, to integrate wellbeing into the Scottish government’s measurements and policy development.

Wright said: “These changes build on the joint principles agreement between businesses and the Scottish government published in December 2021. They should provide businesses with greater focus and clarity from government about what their role is when conducting business in Scotland over the next 10 years.”