Keith Brown under pressure to kick start Scottish economy

Scotland's new cabinet secretary charged with reviving the country's ailing economy is being urged to tackle the growing gap with the rest of the UK as he today sets out his blueprint for growth north of the Border.

Keith Brown says fundamentally the economy remains strong. Picture: John Devlin

Keith Brown will today reveal how he plans to deal with the impact of the North Sea oil crash and soaring unemployment levels in his first address to MSPs since he was appointed by Nicola Sturgeon as the country’s first ever economy secretary.

He will tell a Holyrood debate that he will focus on making the Scottish economy more productive by increasing global trade links and investing in the key sectors of the economy.

But opponents warned last night that urgent action is needed to tackle the downward spiral that resulted in further gloom last week when almost 500 jobs were axed in Aberdeen by North Sea giant Shell, the latest in a series of job blows.

Scottish Conservative finance spokesman Murdo Fraser said: “The outlook is concerning for the Scottish economy with GDP growth is behind the rest of the UK, having previously been higher.

“Unemployment in Scotland is substantially higher than the rest of the UK, with the gap widening. Retail sales are declining, and business confidence is low. There is no point pretending that there are not issues that have to be addressed.”

He added: “There are great strengths to the Scottish economy, but we are simply not performing as well as we should be, and our fear is that the performance gap is widening between ourselves and the rest of the United Kingdom.”

The recent Scottish Trends report found that Scottish GDP did not perform well last year and the outlook is gloomy for the year ahead as the impact of the global oil price slump continues to hit North Sea revenues.

In cash terms GDP fell by 1 per cent in 2015, including North Sea activity while the UK equivalent was up 2.6 per cent.

Unemployment also rose by 8,000 in the first three months of this year in Scotland – leaving a jobless rate of 6.2 per cent in Scotland compared with 5.1 per cent for the rest of the UK.

Labour’s Jackie Baillie accused the SNP of presiding over a “sluggish economy”.

She said: “Scottish Labour believes that a strong economy delivers a strong society and much needed investment in our public services.

“The SNP government has presided over a sluggish economy – growth is slower than the rest of the UK; productivity is less than the rest of the UK; employment has fallen and unemployment is unacceptably high and growing.

“We can and must do better than this.

“We need leadership from the Scottish Government, an active industrial policy with a strategy for manufacturing at its core, and a determination to tackle unemployment as a priority.”

Greens MSP John Finnie said: “The decline of the oil and gas sector must be met with a managed transition to new industries rather than ever deeper tax cuts to encourage the extraction of resources that are ultimately unburnable. By investing now in viable alternatives such as decommissioning, renewables and energy efficient housing we can transfer workers’ skills and provide the long-term stability local economies across urban and rural Scotland need.”
Mr Brown insisted that Scotland’s economy continued to grow last year despite the problems with the North Sea.

“The fundamentals of our economy remain strong,” he insisted ahead of today’s debate.

He added: “At the heart of our actions will be a clear and unrelenting focus on creating a competitive and supportive business environment.”