Ruth McKay: Our local authorities have crucial role in economic recovery

Instead of short-term cost-cutting, Ruth McKay says councils need to look at longer-term benefits when choosing contracts

By Ruth McKay
Tuesday, 3rd April 2012, 1:00 pm

With the cost of food, fuel and energy going up, fears over unemployment and no sign of the economy picking up, this isn’t an easy time to be a hard-working family, or indeed a small business.

Nor, of course, is life currently a barrel of laughs for our councils who, against this backdrop, are going to have to maintain key services within tighter limits.

With the campaign for May’s council elections under way in earnest, how we escape our current economic predicament will surely dominate the debate. Now, you might feel that, whatever the city council does won’t make any difference (and, sadly, even some in local government might share this sentiment). But this attitude is completely wrong.

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Our local authorities could be crucial in driving the recovery.

They are responsible, for example, for about half of the £9 billion which Scottish public bodies spend buying goods and services from the private sector. Imagine the economic benefits we could reap if, rather than simply going for short-term cost-cutting by aggregating contracts into huge units which are out of the reach of local small businesses, councils thought strategically and, where possible, made purchasing decisions on the basis of what would be in the best long-term interests of the local economy.

Local authorities are also many small businesses’ biggest regulator. Thus, if they administer these regulations sensibly, proportionately and clearly, their council immediately becomes a much more attractive place to do business. This could be made easier by, where possible, designing and administering common functions across all councils, rather than on a rule-by-rule, area-by-area basis.

Not only would this put an end to the farce of separate local authorities demanding different forms be filled in for effectively the same purpose, it would save councils money and sweep away the widely varying interpretations of the same regulations.

This opportunity, however, will only be seized if our councils can focus their key departments’ strategies on supporting the local economy.

In practical terms, when the roads department is looking at redesigning a street, the impact on customer parking or access for deliveries should feature. When looking at rent rises for commercial properties, consider the longer-term effect on neighbouring businesses of being surrounded by empty shop units. When the planning department’s priorities are on the agenda, so should the costs of delays to a business’s application.

So, in practice, what does that mean here in Edinburgh?

Well, let’s look at one immediate challenge – how Edinburgh markets itself as a city, not only to visitors but also to residents. This requires a single vision, goal and marketing message which all council departments and organisations can follow. This is particularly important as we look to the post-trams future, when the council will have to work hard to attract businesses back in to the city.

Youth unemployment is also a serious issue in Edinburgh. For businesses to generate jobs, we need a council which puts practical systems in place to support businesses. Just consider, for example, the number of new jobs there would be if we could encourage more self-employed owner/managers to take on their first employee.

I believe we need a clear debate about the contenders’ plans for future business support – particularly in the areas of Edinburgh which have suffered due to the tram works.

Overall, while Edinburgh is proud to be home to some fantastic international companies, we have to remember that 89 per cent of businesses here employ fewer than 50 people. It is these small businesses which are at the heart of communities. They are rooted here, providing vital services, jobs and revenues. They don’t threaten to pack up and leave if they don’t get the tax breaks they demand.

In times of adversity, you need to know who you can rely on. Therefore, the first call for whoever is ensconced in the Leader’s Office at the City Chambers next month should be to the small business community.

There is a golden opportunity, should they have the ambition to seize it, for Edinburgh City Council to sweep away pointless duplication, marshal its forces and drive forward our economic recovery.

• Ruth McKay is chair of the Edinburgh Branch of the Federation of Small Businesses (FSB)

Make a wish

• Buy local and keep the money in the city

• Consider the impact on business and customers before starting roadworks

• Speed up the planning process for business development

• Standardise council functions so businesses are not faced with one rule in one place and another somewhere else

• Develop a single-vision marketing message for Edinburgh