Plea for SNP ministers to ‘buy Scottish’

Published on 15/07/2012 00:00

SCOTTISH companies are 
demanding a fairer share of government contracts to help them compete against overseas rivals and lift the country out of recession.

Although the Scottish Government recently pumped a further £105 million into building projects, the Scottish Chambers of Commerce warned that the extra cash could be in vain.

“If those contracts go to Dutch or German or Spanish firms then they are not going to do us much good in Scotland or the UK,” argued SCC head of policy Garry Clark.

“Other countries seem able to favour their own companies despite the European Union’s procurement rules, so it’s about time we looked at how we can do the same.”

The SCC renewed its calls for increases to infrastructure spending, especially from the coalition government at Westminster, in order to stimulate the economy.

Official figures due to be released this week are expected to show that Scotland’s economy followed the UK into a double-dip recession during the opening months of the year.

“It’s not going to be governments that will take us out of recession but business,” Clark said. “Infrastructure spending is good because it not only helps companies but, in the longer term, it means we have the roads and power grids in place to fuel the recovery too.

“But infrastructure spending on its own will not be enough without looking at which 
companies are winning the contracts.”

A Scottish Government spokeswoman said: “Public contracts are important to Scotland’s economy. That is why we have worked with businesses to ensure that Scottish firms have equality of opportunity and procurement processes are standardised and streamlined to encourage local businesses to bid for 
public contracts.

“In 2011, three-quarters of all suppliers awarded public sector contracts through Public Contracts Scotland, our 
national advertising portal, were based in Scotland.”

Donald MacRae, chief economist at the Bank of Scotland, thinks it will be “touch and go” as to whether Scotland has 
entered recession, noting 
there was a “slim chance” the country might have avoided the double-dip.

“What the figures will really show us is that the economy is stagnating,” he said. “We need to increase capital spending on infrastructure projects.”

Colin Borland, head of external affairs at the Federation of Small Businesses in Scotland, said improving business confidence is also important.

“The figures will simply underline the need for concerted action to get the economy moving,” he said.

Dougie Adams, senior 
adviser to the Ernst & Young Scottish Item Club economic think tank, said: “I expect Scotland’s economy contracted by about 0.1 or 0.2 per cent in the first quarter, slightly less than the UK as a whole.

“I’ll be looking out for the manufacturing and service sector figures to see what those will tell us, as I expect construction will have been badly hit.

“There have been signs, such as the purchasing managers’ surveys, that the economy may have bounced back during the second quarter.”