Why 'pivotal' Scots business sector needs government 'institutional scaffolding' to drive economic growth

Scotland has a “pivotal” role in setting the UK’s economic trajectory and delivering crucial long-term sustainable growth, with the powerhouse business sector needing the next UK government’s support to achieve this, a key trade body boss is set to state todayduring a visit north of the Border.

Rupert Soames, in his role as chair of the Confederation of British Industry (CBI), is set to deliver his first speech in Scotland to more than 200 business and political leaders.

His pre-election comments come as the trade body outlined how it expects Britain's economy to see faster-than-expected growth this year and next as the outlook brightens after a tough 2023.

'Businesses want to hear all parties speak to how they can work with business – and each other – to deliver in the long term and in the national interest,' Soames is set to say today (file image). Picture: Julie Bull.

Soames is to state: “I am convinced that this election, and how both Holyrood and Westminster work with business – and with each other – in the five years after the election will determine whether or not our country and economy thrive for the next 20.”

The businessman – former boss of both outsourcing specialist Serco and temporary power supplier Aggreko, and grandson of Sir Winston Churchill – added that it is imperative for all political parties to create “a new narrative for the UK and for Scotland, which can once again get our economy firing on all cylinders, and deliver the long-term, sustainable growth we urgently need”. He continued: “Instead of the sugar rush of short-term politics, businesses want to hear all parties speak to how they can work with business – and each other – to deliver in the long term and in the national interest.

“Scotland will have a pivotal role in how we reclaim [the UK’s bruised international] reputation and set the economy back on the path to growth. We have heard time and again how Scotland will be decisive for this election, but business knows that its role will, if anything, be even greater afterwards.

“Scotland is an energy powerhouse, with natural resources that are the envy of the world, the best-educated workforce in the UK, the home of two green freeports to supercharge our exports. But we cannot unlock Scotland’s potential for growth without facing the fact that Scottish productivity underperforms the already dire performance of the rest of the UK.

“Governments cannot deliver growth. Only business can. But business needs government to provide the institutional scaffolding that supports growth... business also relies on Holyrood and Westminster continuing to work together – in collaboration not confrontation as they have with such great success on green freeports like Inverness and Cromarty Firth.”

The CBI said separately in an upbeat report that it had upped its forecasts for UK growth to 1 per cent in 2024 and 1.9 per cent in 2025 due to an expected pick-up in consumer spending amid retreating inflation and robust wages. The study follows an upgrade this week from fellow business group the British Chambers of Commerce (BCC), which is now predicting growth of 0.8 per cent and 1 per cent for the two years respectively.

Louise Hellem, CBI chief economist, said: "It's encouraging to see that the outlook for the UK economy is improving after a difficult 2023. However, we cannot afford to be complacent… To ensure longer-term, sustainable growth, we must tackle our ongoing productivity problem."