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New legislation not enough to boost our small businesses

Business leaders have warned the Scottish Government that its long-mooted legislation aimed at boosting small businesses and local economies could fail to make an impact.

WARNING: The Herald launches its SME SOS campaign.
WARNING: The Herald launches its SME SOS campaign.

MSPs will today approve a bill aimed at delivering a bigger share of Scotland's £10billion public sector spend to the local small and medium-sized enterprises (SMEs) which form the bedrock of the economy.

The Herald yesterday launched its SME-SOS campaign to highlight key roadblocks which are holding back SMEs, starting with public procurement, and moving on to roads and town centres, and the skills gap. Liz Cameron, chief executive of Scottish Chambers of Commerce, warned that little of the new legislation would be mandatory. She said: "Is the bill going to deliver for business? Whilst there is mention of economic impacts...we would urge this to be much more specific."

Ms Cameron said a key element of the bill was to require authorities to have procurement strategy documents.

"We understand that the majority of public sector agencies already have strategy documents in place. The real issue is whether they are being implemented effectively, and how they are being measured."

She added: "This has been on the table now for eight years. Scottish Government should be tightening up on completion of this agenda and ensuring that public sector agencies are fully embracing and adopting the change needed."

On late amendments to the bill aimed at guaranteeing employment rights, Andy Willox, the Federation of Small Businesses' (FSB) Scottish policy convenor, said: "We aren't clear how these last minute changes will be interpreted by public bodies, don't understand if the cost of such changes are expected to be met by the public or private sectors, and fear that they might become a barrier to small business participation. We need to balance carefully our approach."

MSPs are also asking for the extension of the bill to cover Scottish Water and the five hybrid public-private 'HubCos' - building £1bn of infrastructure for the Scottish Futures Trust - all of which are exempted.

Tavish Scott, LibDem MSP for Shetland, who has tabled the amendment, said: "Including the HubCos in the provisions of the bill would make them more transparent."

Nicola Sturgeon, minister responsible for the bill, has told MSPs in committee that Scottish Water has "provided an assurance that it supports the general principles of the bill and would continue to adhere to its key components". She added: "The SFT intends to work with the HubCos to encourage them to adopt the good practice in the bill wherever it is appropriate. Indeed this is already happening in a number of areas such as community benefit clauses."

The Scottish Government, commenting on our campaign, said: "The Bill contains a number of important provisions designed to help ensure that SMEs can find and compete for contracts and ensure they are not unfairly disadvantaged when they bid.

The Bill will also place a new duty on public bodies to consider how to facilitate SME access when they are planning a procurement.

"On top of that we have worked with small business to develop our town centre regeneration strategy, provide real support to 92,000 businesses through the Small Business Bonus.

"We have also supported SME involvement in youth employment through our Youth Employment Scotland programme and protected local authority funding ensuring that despite not having access to the UK Government's roads fund they can invest in local services such as roads.

"However, we are not complacent about the good practice that exists in Scotland, which is one of the reasons why we are introducing this Bill to establish a national framework for sustainable public procurement which supports Scotland's economic growth."

Contextual targeting label: 
Business

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