STUART PATRICK

Over the summer the Scottish Government held a short consultation into Scotland’s enterprise and skills system. This follows the publication of an Audit Scotland review into the effectiveness of the enterprise bodies Scottish Enterprise (SE) and Highlands and Islands Enterprise (HIE). I had the privilege of being one of the advisory panel to that review.

It is now eight years since Scottish Enterprise was comprehensively reformed, abolishing the local enterprise companies and setting up a new skills agency, Skills Development Scotland (SDS). Last year SE and HIE spent £398m,

down 12% since 2008, a budget dwarfed by the £150bn Scottish economy they are attempting to influence. SDS spends a further £207m on skills programmes, notably Modern Apprenticeships.

The most striking conclusion from the Audit Scotland work was that whilst the enterprise bodies regularly deliver on their performance targets, it wasn’t clear how those targets were helping to tackle some of the basic issues set out in the Scottish Government’s own Economic Strategy.

Some of these issues are becoming chronic. Our productivity performance compared to major economic partners such as the US, Germany and France is alarming, with exports over-dependent on a small number of large companies in too few industry sectors like oil and gas and whisky. Not enough of those sectors upon which the enterprise bodies have been focused are developing quickly enough to replace a declining oil industry, as the recent Government Expenditure and Revenue Scotland (GERS) figures confirmed.

So I would respectfully suggest some adjustments to the current direction. Asking the enterprise bodies and SDS to concentrate on delivering their performance targets, and leaving the development of strategy largely to the Scottish Government, is wasting talent inside those agencies. Give them freedom to work alongside civil servants to understand our problems and experiment with new approaches, like Crawford Beveridge did with the Business Birthrate Strategy when he was SE’s CEO in the 1990s.

At the same time recognise it is impossible for agencies the size of SE or SDS to shift the Scottish economy on their own. Design your new enterprise and skills system to be inclusive - reconnect with local authorities, especially since city regions are much more important in economic development, and bring bodies like the Chambers and SCDI closer to your work.

In addition, make sure such as Transport Scotland and the Scottish Funding Council understand fully what is needed to reform our economy.

Stuart Patrick is chief executive of Glasgow Chamber of Commerce