Politics needs to reset relationship with business - Liz McAreavey

At our annual general meeting Edinburgh Chamber of Commerce relaunched our Prospectus for Growth, first published in July 2021 as a blueprint for more productive working with policy makers at local, Scottish and national level.

Liz McAreavey, CEO at Edinburgh Chamber of Commerce

It called on politicians to urgently re-set the relationship with business and make the economy their top priority.

Sustainable economic recovery and growth, it said, would be needed to provide the resources to fuel our society. Two years on, and in the face of our current significant economic challenges, it is more relevant than ever.

Uncertainty and change have become the norm for businesses – we adapt and innovate well, but inconsistency and instability are the enemies of a successful economy. In the past two years the UK has had three Prime Ministers, four Chancellors of the Exchequer; Scotland has

had two First Ministers and two Cabinet Secretaries for Finance and the Economy. We have a Conservative UK Government, and SNP led Scottish Government, and a Labour led city council.

Stubbornly high inflation, which risks becoming embedded in the UK economy more than any other leading developed economy; critical skills shortages; rising costs; wages inflation; and what appears to be an ever-increasing burden of legislation and regulation are hampering efforts to bring the cost of doing business crisis under control. Collaboration and engagement are urgently needed to create a more partnership approach to addressing these challenges.

Some key highlights from the update include:

Re-setting the relationship

Some progress on this issue has been made since the publication of Prospectus for Growth. At a city level, a new Cross-Party Edinburgh Economic briefing is being held quarterly by the Chamber and partners and is well attended by politicians and influencers from government at all levels.

At a national level, the New Deal Group, announced by the First Minister and Chaired by Neil Gray, Cabinet Secretary for Wellbeing Economy, Fair Work and Energy has been convened with Chamber representation. However, much more is needed. The top priority we are keen to see is earlier, more constructive meaningful engagement and consultation, and the establishment of a more formal forum at a local level where politicians can engage, hear and better understand the voice of business.

Skills and training

We need a more cohesive approach to skills development, further improvements to the education-industry interface, and incentives to encourage businesses to invest in training and future skills – especially around the green and digital economies.

Entrepreneurship

Edinburgh needs to tell a stronger story about its excellent start-up ecosystem, and its successful incubator and accelerator programmes. The creation of a city plan should be encouraged to help support, attract and retain entrepreneurial talent across the board, especially from under-represented groups and communities.

Planning

The planning process at both a local and national level urgently needs to be speedier and more open if a whole variety of essential targets are to be achieved. This need not jeopardise the integrity of the system, but Edinburgh faces many planning challenges and growing demands on the system which need to be addressed.

Culture, the arts and tourism

We need a sensible and progressive conversation with industry around the implementation of the Visitor Levy, and, critically, where this revenue will be spent.

As part of the evolution of the Prospectus, we are also calling for the creation of a long-term modern Scottish Industrial Strategy, developed along cross-party lines to remove short-termism and politicisation from the equation. Such a strategy, which looks at capacity building and productivity, conceived and led in partnership with industry, and aligned with existing strategies including those focussed on entrepreneurship, innovation and skills would bring everything together, creating a cohesive, overarching and long-term aim for the development of our economy and society.

All that we hold dear in Scotland in terms of our ambitions around the wellbeing economy, fair work agenda and net zero targets depends upon a successful economy, built in true partnership with industry. It is too important at this vital time that we make good, sustainable, thoughtful and strategic choices that will ensure the future is bright.

Liz McAreavey, Chief Executive, Edinburgh Chamber of Commerce