The Framework for Economic Development in Scotland
2004
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The Executive has a clear vision for economic development:
to raise the quality of life of the Scottish people through increasing the economic opportunities for all on a socially and environmentally sustainable basis.
Four outcomes are central to achieving this vision:
- economic growth - with growth accelerated and sustained through greater competitiveness in the global economy;
- regional development - with economic growth a pre-requisite for all regions to enjoy the same economic opportunities, and with regional development itself contributing to national economic prosperity;
- closing the opportunity gap - with economic growth a pre-requisite for all in society to enjoy the same economic opportunities, and with social development in turn contributing to national economic prosperity; and
- sustainable development - in economic, social and environmental terms.
Enabling objectives. The achievement of the desired outcomes depends upon a complex array of economic drivers. Establishing the underlying conditions and context for economic growth to flourish is, therefore, a critical step. There are four key enabling objectives:
- a stable and supportive macroeconomic environment;
- a facilitating national economic context: encompassing the physical, human and electronic infrastructure;
- dynamic competitiveness in Scottish enterprises; and
- economic policies and programmes to secure the social, regional and environmental objectives.
The first objective here is widely acknowledged as being a pre-requisite for economic growth and stability. It is clearly the primary responsibility of the UK Government - although the Executive bears responsibility for supporting and contributing to this objective - while the other three enabling objectives form the focus of the Executive's approach. It is in these respects that the public sector has potentially the greatest contribution to make to the success of private sector entrepreneurial activity and to the overall growth performance of the Scottish economy.
The Framework for Economic Development in Scotland is based on these underlying principles:
Long-term approach. FEDS requires a long-term strategic approach that focuses on the key determinants of economic development. Many of these need, by their very nature, to be addressed through consistent and sustained policy implementation over many years.
Complementarity of the public and private sectors. Economic growth is primarily determined by the success of enterprises in developing products that can compete effectively both domestically and throughout the world. While Government can make a contribution, it is the dynamism of the private sector on which future prosperity depends.
The prevailing set of economic powers. FEDS takes the present constitutional settlement, and notably the definition of powers and responsibilities as set out in the Scotland Act (1998), as its basis.
Importance of sustainability. FEDS takes seriously the responsibility of preserving for future generations the economic opportunities and environmental resources that we enjoy today.
The economic linkages between different sectors of the economy continue to be important and have to be taken into account when implementing development policies.
Economic growth is a national priority. It is not the sole responsibility of one area of Government, or dependent on one sector.
RAISING PRODUCTIVITY IS THE KEY CHALLENGE
The productivity and associated dynamic competitiveness of our enterprises remains the fundamental driver of our economic performance.
PRIORITIES FOR ACTION
The Executive has identified five key drivers, which are the main elements in promoting both private sector and public sector productivity:
- basic education and skills: crucial to any strategy for economic growth and the bedrock for the foundation of a competitive economy, supported through, for example, raising standards of educational attainment for all in schools;
- research & development and innovation: the foundations for improvements in productivity and for sustainable global competitiveness; promoted by, for example, supporting enterprise expenditure on R&D;
- entrepreneurial dynamism: the creation of new enterprise and a positive, risk-taking attitude to enterprise are central to the establishment of a dynamic economy and are achieved through, for example, addressing the equity gap facing small business;
- the electronic and physical infrastructure: joining business to business, consumer to business, and ensuring the efficient movement of goods, people, and ideas to the right places at the right times; by, for example, ensuring access to broadband services in every community in Scotland; and
- managing public sector resources more effectively: improving the efficiency and effectiveness with which resources are deployed in the provision of public services through, for example, identifying major improvements in service delivery, backroom and support processes to release resources for the enhancement of front-line services.
Copies can be obtained from the Office of the Chief Economic Adviser
Telephone 0131-244 2788 or visit the website at www.scotland.gov.uk