Supporting business to rebuild

3 Dec 2020

I started my speech to the Scottish Conservative conference recently with the word Hope

And the fantastic news yesterday that the United Kingdom is the first country in the world to have a clinically approved Covid 19 vaccine available for rollout, fills us all with hope.

It feels as though we are finally turning a corner and that there is an end in sight.

That we can expect to see a return to normality in the spring and the removal of restrictions.

That is just as important for our businesses community to thrive as it is for every single person in our country.

Yet we must look at what we can do to support jobs and businesses now and as we recover from the pandemic.

I welcomed the opportunity to speak with businesses and representative bodies following a speech I gave in October

and at that time we were facing the challenge of increasing restrictions after what felt like a decent summer of relaxation of restrictions.

It was a change of pace and one that was going to have a profound effect on jobs and businesses right across the country.

While we had already faced restrictions in the spring, that was a sharp, sudden shift into total lockdown.

A very different experience from the one that we have faced in the autumn.

Through September and into October, there was a progressive tightening of restrictions across the country.

This meant that businesses and workers had to adapt rapidly to new guidance and rules.

And the speed at which restrictions were increased was not matched by Scottish Government grant payments,

with businesses having to wait weeks to receive funding after being forced to close.

That was why I was eager then to take stock of business views and amplify concerns about the conditions that you faced.

And my main message to the Scottish Government at the time was, listen to business.

You know better than anyone else how these restrictions will impact you and what support you need.

Since then we have seen national restrictions move towards an approach based on council areas under the so-called Strategic Framework.

This Framework sets the rules that we all live and work with for months to come.

But the Strategic Framework, and more importantly the support attached to it, cannot be rigid and inflexible.

It must be able to adapt and evolve as an approach based on the evidence of what is working and crucially what is not working,

That’s why I welcome the opportunity to again listen to the views of businesses and representative organisations about what government can do better to support you through this pandemic.

And to once again be a voice for your concerns at this time.

Because, as I have said before, we need to balance public health concerns with supporting workers and businesses.

We must be flexible enough that our efforts to save lives do not needlessly harm livelihoods.

So, I want to set out some of my thoughts on the support that you are getting from the Scottish Government and how this can improve.

We are now one month on from the introduction of the Strategic Framework.

At the time my party supported a move to a clear, local approach to managing infection rates.

One that has rightly meant that the R number in Glasgow, does not affect the restrictions that people are living under in Galloway.

And one which has meant that when restrictions are being tightened or relaxed we know what rules we are moving to.

Yet while the changing rules have become easier to understand they have not always become easier to prepare for.

We are still seeing far too many announcements of changes to levels and restrictions being made at the last minute.

And worse; being the subject of speculation and briefings to the media for days beforehand.

Last week, it was announced that Midlothian would stay at Level 3 twelve hours before it was due to move to Level 2.

This was in spite of a week of promises about a reduction.

Some businesses will have welcomed the chance to open for the first time in nearly two months, while others will have been looking to extend hours.

Staffing rotas will have been drawn up and orders placed, all of which has costs, some of which will be lost and can’t be recouped.

Then there was the few days’ notice between the announcement and introduction of Level 3 restrictions in Perth & Kinross and Angus

and Level 4 in the West of Scotland.

It is not fair to employers that the tightening, relaxation or changing of restrictions continue to be announced with little or no notice.

Or that stray comments and speculation do not reflect final decisions.

We recognise the need for decisions to be taken rapidly to effectively respond to changing infection rates and to control this virus.

Yet we shouldn’t also be in a limbo with a ‘will they, won’t they’ decision on levels hanging over us.

That is why I called for the Scottish Government to introduce an Adaptation Period of one week between the formal announcement and introduction of new restrictions.

To give businesses the proper time to prepare for changes to the rules in their area.

Then there is the design of these restrictions.

The rules that underpin the Strategic Framework are continually being updated, to fill in gaps or take account for new data.

Yet it is businesses that are going to have to implement them, often at short or with no notice.

To avoid the need for immediate guidance changes and to make the guidance as practical as possible, the Scottish Government should be working with business.

While I have heard from some of you that engagement has improved, and I welcome that, there is still no formal business advisory group.

I’ve been promoting this for some time and the First Minister even said in the Scottish Parliament that this was something that she was looking to take forward.

So I call again on the Scottish Government to establish a ‘Coronavirus Business Advisory Council’

so that engagement is the rule rather than a choice.

We have all been very grateful of the hard work that businesses have undertaken to make their premises safe for customers and staff.

You have played your part to reduce the spread of coronavirus and have borne the costs of doing so.

You have had to adapt and make major shifts in working practices, you should not also have to deal with other regulatory changes,

That is why we are calling for a break on new non-Covid related regulation on businesses for the foreseeable future.

So that employers can better manage the costs of the pandemic and follow changing Covid guidance.

Financial support is crucial and while the Strategic Framework has allowed for a flexible regional approach to be taken to managing the virus, the grant system that has accompanied it has not shown the same flexibility.

The main grant scheme follows the restrictions that are in force in each local authority area.

If your business has been forced to close or has been restricted directly by the rules, then you are entitled to an appropriate grant.

A pub in a Level 2 area can serve alcohol and has to close at 8pm, whereas a pub in a Level 4 area cannot open.

The former is entitled to a restrictions grant but the latter is entitled to a closure grant.

That is where the system works – to an extent.

Yet what happens when the same pub is in a Level 3 area, it has to close at 6pm and cannot serve alcohol.

It will be very difficult for any pub to justify opening its doors under those conditions.

And we see this in our high streets and town centres, businesses that could open under the framework but choose not to because the costs they face in doing so – greatly outweigh any gain.

Yet they are only entitled to a [restrictions] rather than the full closure grant.

Then there are those businesses that are not impacted by the restrictions themselves but feel their effect.

Often companies in the supply chain; whose customers are facing restrictions

or the hospitality sector who are reliant on tourism from areas with travel restrictions.

Last week, I was contacted by a B&B owner in South Ayrshire who has run her business for 14 years as her only job.

Normally this period would be a high point of activity for her business but because of the travel restrictions she has no bookings and is unable to claim any support because her business is not itself facing restrictions.

This isn’t an isolated case, across our country businesses are falling through the gaps in the grants scheme.

I have spoken to sports clubs, travel and tourism businesses, events businesses, to name just a few, that have all been left with no support from the Scottish Government

And the £30 million ‘discretionary fund’ is totally inadequate to fill those gaps.

The Fraser of Allander Institute have said that £1 billion of the funding that the Scottish Government received from the UK Government this year remains uncommitted.

And while last weekend they were able to find over half a billion pounds for announcements at the SNP Conference not a penny of that was for businesses affected by restrictions.

The Scottish Government needs to urgently start using the resources it has to support employers

or else we are going to face a very hard winter.

The funding available just now is nowhere near enough and everyone can see that.

That is why I am today calling on the Scottish Government to carry out a rapid review of business support schemes.

A wholesale look at the closure and restrictions grant limits

and the criteria for accessing those grants

including for business indirectly affected by restrictions.

And as an immediate change they should allow businesses – who have voluntarily closed because of restrictions – to access the full closure grant.

We should also be imaginative about short-term measures that we can take to support local businesses.

With the ending of level 4 restrictions, the Scottish Government should be looking at funding the removal of parking charges in town centres to encourage local shopping.

Or supporting communities and start-ups to take over vacant publicly owned units in our high streets to increase footfall.

At this crucial time,

when many businesses would be enjoying their best weeks of the year,

it is more important than ever that government does what it can to prevent businesses across Scotland from shutting their doors for good.

However, it is also essential that we remove some of the uncertainty around the support that businesses will receive after the winter.

With all the excitement around vaccines and hopes of a return to normality by Easter, we can’t  forget that this pandemic will have long-term effects.

Our economy is going to take years to recover and businesses will continue to need to be supported.

Second to grants, the best way that the Scottish Government can directly support businesses is through the rates system.

The Chancellor’s Spending Review confirmed an additional £1.3 billion of funding for the Scottish Government next year for managing the pandemic.

And the business rates poundage freeze and exemptions in Scotland cost £900 million this year.

The Scottish Government have the resources they need to extend those measures and we all know that is the minimum that employers need,

So they can put an end to this uncertainty right now by committing to extending relief on retail, hospitality and leisure businesses and freezing the poundage rate into 2021/22.

However, we must also consider the future of taxing businesses based on property.

It was disappointing that the SNP voted yesterday to delay the next revaluation to 2023.

Meaning that businesses are going to continue to have to pay rates based on 2015 valuations.

Economic conditions have changed dramatically since then, so for businesses in many parts of our country those valuations are now grossly unfair.

But if there is going to be a delay then let’s use that time to look at the future of business taxation.

Rishi Sunak is currently undertaking a fundamental review of business rates in England

to look at how we modernise business taxation.

The Scottish rates system is still underpinned by legislation passed in 1854.

So, I urge the Scottish Government to use this delay to work with the UK Government on designing the future of the business rates system

Let’s recognise that the rates system was not fit for purpose long before this pandemic began.

And create a system which allows physical businesses to compete with online retailers.

In October, I called for the Scottish Government to listen to business and that is exactly the same message that I want to get across to them today.

You know the support that you need to get through this pandemic and to play a key role in our economic recovery.

My party has listened and will continue to make your case to both of Scotland’s governments about the support you need to protect jobs and businesses.

Because this pandemic has not been your fault, but it is you that have borne the costs of tackling it.

You may not get a £500 bonus, taxed or not, but we should be recognising the contributions that business have had to make.

And our goal must be that no business should face collapse because of restrictions put in place to protect lives.

So the Scottish Conservatives will continue to work with you to get the support and engagement from the Scottish Government that you deserve.

Both throughout this pandemic and as we look to rebuild our country in the months a