A new report is asking the Scottish Government to take stakes in struggling firms, including SMEs.
The document, created by the Advisory Group on Economic Recovery, makes 25 recommendations based on the thoughts and opinions of hundreds of businesses.
One of the most significant is that the government must support guaranteed employment for young people, securing two years of work at the real living wage.
Other suggestions include a ‘significant increase’ in infrastructure investment, especially in digital technologies, along with targeted measures to help the tourism and hospitality industries.
SME focused recommendations highlight sector-specific banking products for small businesses and ‘differentiated solutions’ such as re-start loans, repayment plans and new deals.
The enquiry was run by Benny Higgins, the former chief executive of Tesco. Higgins suggests that Scotland will need £6bn to revive the economy – the current limit going through the fiscal framework is £450m. Investment will need to be at least 4 per cent of financial output to be effective.
Figures show that Scotland’s GDP is down 2.5 per cent in first three months of 2020 and fell by 18.9 per cent in April.
Benny Higgins said:
“Scotland faces an economic challenge of monumental scale. If we do not intervene radically to transform our economy, inequalities will drastically widen with long-term scarring for communities across the country and for our young people in particular. This cannot be allowed to happen.
“The Advisory Group on Economic Recovery has worked at great speed over the past two months, engaging extensively with businesses and with wider civic society to understand the challenges that we face, but crucially to curate a set of recommendations that emphasise the immediate need to protect and create jobs, reduce inequalities by building a green and technology-led recovery and make Scotland an attractive place to do business.
“To create a robust, resilient wellbeing economy, the public and private sector must now build a new partnership to prioritise and deliver bold action. And they must do so with purpose and urgency.”
A detailed response from the Government will be published before the end of July.
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