SCOTLAND’S economic recovery remains “fragile” and ministers should launch a “comprehensive review” of all the public sector support offered to companies to make sure it is effective, according to the Scottish Chambers’ of Commerce (SCC).
Liz Cameron, the chambers’ chief executive, called for the Scottish Government to give more support for companies that want to grow their exports.
Her comments came as the SCC’s quarterly economic report, compiled with Strathclyde University’s Fraser of Allander Institute, found signs of growth across all economic sectors.
Retailers reported increased optimism for the first time since 2006, while manufacturers have seen their orders rise at their fastest rate since 2007.
Cameron said: “Business confidence and optimism is on the right course and governments must align their policies with businesses to continue this journey of a sustainable recovery.
“Now is the time for a comprehensive review across the Scottish Government of all business support provided by the public sector in Scotland, to make certain that Scotland’s European Union funding allocation and other public spending is being invested effectively to catalyse and ensure solid Scottish economic growth.
“The survey results demonstrate that there is a need for Scottish international exports to accelerate. Increasing international export income is an important element of strengthening economic recovery. The Scottish Government must increase and improve support to Scottish businesses to complete globally.”
The chambers also renewed its call for the UK government to slash air passenger duty, claiming that the tax on air travel was making Britain uncompetitive compared to its neighbours.
Budget airline Ryanair yesterday vowed to expand its Irish capacity by one million passengers per year after the Dublin government pledged to ditch an air travel tax from April as part of its budget for 2014.
Ryanair’s traffic at Ireland’s main airports fell to 23.5 million year from 30.5 million before the tax was introduced in 2009.
The SCC’s report found that more than half of hotels reported a rise in bookings over the summer, while the long-term decline in retail sales has also come to an end.
Cameron warned: “The UK and Scottish governments need to look at their policy and spending priorities to make sure they are supporting businesses to grow and invest sustainably – without business growth built on strong foundations, this recovery will falter.”
Her call for a review came as data from Scottish Enterprise showed that its Edge fund attracted £2.6 million of investment into start-up companies during its first year in operation.
Edge injected £1.2m, with private investors pumping in a further £1.4m. In total, the fund has supported 34 fledgling businesses, which have created 59 jobs and increased their collective turnover by £600,000.
A spokeswoman said: “The Scottish Government is already maximising European funding to help support businesses to grow.
“In June, the First Minister launched the £37.85m SME Growth Programme to support businesses to grow and create employment opportunities. While times remain challenging, the Scottish Government is doing everything within its power to help businesses thrive.”