The Government Economic Strategy

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C. STRATEGIC PRIORITIES

In order to deliver our Purpose of accelerating sustainable economic growth and fulfil the targets set out in Section B, we must give priority to the specific channels through which growth is most effectively driven.

The Economic Strategy therefore identifies five Strategic Priorities that are internationally recognised to be critical to economic growth:

  • Learning, Skills and Well-being;
  • Supportive Business Environment;
  • Infrastructure Development and Place;
  • Effective Government; and
  • Equity.

Each of these priorities is critical to the delivery of our Purpose and will be reflected in the approach to each of the Strategic Objectives to deliver a Wealthier & Fairer, Smarter, Healthier, Safer & Stronger and Greener Scotland.

Our policies and resources must be aligned towards the Strategic Objectives with a clear focus on achieving the Purpose, with the five Strategic Priorities at the centre of that thinking. We must also follow a joined-up approach across all the Strategic Objectives in order to maximise their impact and effectiveness, since each priority contributes to several - if not each - of the Strategic Objectives. It is only by working together - across government and across the public, private and third sectors - that we can achieve our Purpose.

The new Government sees the whole of the public sector having a critical role to play in contributing to the five priorities and achieving the key targets in view of their centrality in delivering the Purpose and Strategic Objectives. The co-ordination and stimulation of those contributions from all arms of the public sector will be essential to the success of the Government Economic Strategy.

C.1 LEARNING, SKILLS AND WELL-BEING

HOW WILL IT CONTRIBUTE TO DELIVERING THE GOVERNMENT'S PURPOSE?

Our people are our greatest economic asset. A skilled and educated workforce is essential to building our comparative advantage and to the delivery of sustainable economic growth 28. Investment by all individuals and by the state in early years, school, further and higher education has a proven impact on the employability and productivity of individuals and, in turn, business growth. Learning and skill development in work is also key to developing a more adaptable economy.

There is increasing evidence around the return on investment from early years intervention 29. On top of benefits to the individual, Scotland's Scandinavian neighbours offer lessons about the potential positive impact of high quality, affordable and widely available early years provision on labour market participation and population 30.

We perform well, relative to other countries, on the skills and qualifications of our workforce 31. However, this has not translated into enhanced economic performance. A key message from Skills for Scotland32 is that high levels of skills and qualifications must be matched by greater utilisation of skills to boost productivity and growth. It is also clear that a more fulfilled and purposeful workforce will also be a more productive workforce. Action to improve health inequalities, including mental health, 33 will reduce absenteeism and increase economic participation, particularly where a joined up approach is in place to help people into work.

Creating the conditions for growth will enhance Scotland's attractiveness and boost immigration 34. Bringing talented people to Scotland, and providing the opportunities for talented people to stay will increase the pool of skills readily available to employers and make Scotland a more attractive location for investors 35.

This priority delivers through all the Strategic Objectives.

The importance of learning and skills as a fundamental driver of growth is firmly established as a critical element in the creation of a knowledge-based economy that is responsive and adaptable to rapid global change and the establishment of a wealthier Scotland. A smarter Scotland needs young people who are ready to contribute effectively in the community and the world of work and go on to develop their skills through lifelong learning. Further, it needs improved skill levels across the entire population and a better match of supply and demand.

In addition, this priority is an integral part of securing the objective of a stronger and safer Scotland and also a fairer Scotland, in which individuals are empowered through improved and different approaches to learning and experience to find worthwhile employment and to contribute positively. In so doing, the costs of weaker and less safe communities will be reduced as the social and economic costs of fragile communities and chaotic family life are reduced. In a safer Scotland, education and development services for troubled and troublesome young people will help them become productive members of society, participating in the mainstream economy.

Equally, there is little doubt that learning, skills and well-being play a key role in securing the objective of a healthier Scotland, both in building up the understanding and knowledge necessary for individuals and communities to develop healthier lifestyles and a better quality of life, and in benefiting from advances in medical care and science. Equally, health and well-being are critical to people's ability to engage effectively in education and training and to increase their participation in the labour market. A greener Scotland provides the environments and opportunities for people to increase their mental and physical fitness.

Box C1 sets out key strategic approaches and policies which we will pursue in addressing this priority:

BOX C1: LEARNING, SKILLS AND WELL-BEING - KEY STRATEGIC APPROACHES AND POLICIES

A focus on giving every child a strong start in life. The foundations for future success are laid in the early years of a child's life and through their compulsory schooling. The positive outcomes that we seek for our people in later life will be built on these foundations.

A focus on school education enabling all our young people to succeed and gain the skills they will require as individuals and to contribute to the wider economy. This includes actions to:

  • help parents and carers provide a nurturing and stimulating home environment, including help for parents with any literacy and numeracy issues of their own so that they can in turn help their children;
  • join up the education experience for children, managing more effectively the transitions from pre-school to school and onto further and higher education or work;
  • ensure that we equip young people with good literacy and numeracy skills - giving them the confidence and ability to continue to learn and develop other skills whether they choose to enter work or continue with their formal education;
  • take forward the Curriculum for Excellence, enabling all children and young people to develop as successful learners, confident individuals, responsible citizens and effective contributors, helping young people develop and appreciate the importance of the essential skills and capacities so critical to work and later life;
  • improve the quality of teaching through consolidating the major improvements made to initial teacher education and the probation year, promoting the chartered teaching scheme, investing in continuous professional development, and encouraging the development of leadership skills at every level; and
  • stimulate the future generation of entrepreneurs in Scotland through building the ambition, creativity and enterprise awareness of our school children.

Ensure the supply of education and skills is responsive to, and aligned with, actions to boost demand. This includes actions taken forward as part of our skills strategy, Skills for Scotland, to:

  • focus on working with employers and employees to increase the effective utilisation and demand for skills;
  • ensure that our national training programmes meet the needs of individuals and employers;
  • ensure flexible provision which is responsive to the needs of individuals, employers and the wider economy;
  • ensure a funding system for Further and Higher Education through the Scottish Funding Council that is responsive to the needs of individuals, employers and the wider economy; and
  • bring together the public agencies involved in delivering information, advice and guidance services and skills provision in the new skills body to build improvements around the needs of individuals.

Remove any barriers that stand in the way of all individuals participating in learning, skills development and realising their potential in the workforce. This will include actions to:

  • make a clear commitment to young people about the routes to education, employment and training which are on offer and the support they can expect;
  • facilitate local design and delivery of learning for those furthest away from the labour market;
  • reduce financial barriers to people across Scotland accessing higher education, legislating to abolish the Graduate Endowment fee and progressing wider plans to tackle student and graduate debt; and
  • promote the provision of high quality, accessible, affordable, flexible childcare, in order to enable parents to access training and employment opportunities.

An approach to health and well-being to ensure everyone enjoys the level of physical and mental health that gives all Scots the opportunity to maximise their potential. Working in harmony with this Government Economic Strategy, our Action Plan for Health and Well-being will:

  • help people back to work, with more effective joint working between employment and health services;
  • increase the focus on addressing health inequalities, with greater targeting of resources on services and environments that support disadvantaged people and communities; and
  • improve the life chances of those at risk by investing in early intervention and prevention to give children the best possible start, building on the current school meals pilot.

Create the conditions for talented people to live, work and remain in Scotland. This will include actions to:

  • ensure a joined-up approach to promoting Scotland, bringing together economic opportunities with key quality of life issues such as housing, transport and childcare and the importance of culture and sport, to increase our ability to retain and attract skilled workers;
  • pursue population growth that matches the European average; and
  • ensure Scottish circumstances are actively considered in UK decision making on migration policy, including determination of shortage occupations. In the longer term, we will seek greater responsibility over migration policy, allowing the introduction of a Scottish green card.

C.2 SUPPORTIVE BUSINESS ENVIRONMENT

HOW WILL IT CONTRIBUTE TO DELIVERING THE GOVERNMENT'S PURPOSE?

Scotland's businesses are the primary driver of sustainable economic growth. Our national competitiveness depends critically on the competitiveness of our individual businesses. Scotland benefits from being home to a range of highly successful businesses across a number of economic sectors. As well as providing employment and earnings, they form the key element of Scotland's competitive business environment - as demanding customers, effective suppliers and competitive rivals. It is this competitive business environment, for many at an international level, that can boost productivity by stimulating investment, innovation and the greater development and utilization of skills. Increasing the size, competitive strength, productivity and ambition of Scotland's business base is a major challenge - and opportunity - which will underpin the demand for high quality skills, infrastructure and services. The challenge for government is to create the best possible environment for competitive businesses, entrepreneurship and innovation to flourish.

This priority will be delivered through all Strategic Objectives, particularly Wealthier and Fairer, Smarter and Greener.

As a key priority for growth, a supportive business environment, through responsive and focused support and a competitive tax regime, will be central to a wealthier and fairer Scotland. Scotland should be seen as a place to do business, both at home and abroad, with key companies and sectors seen as market leaders. Through a smarter Scotland, we can fully utilise our world class universities and promote knowledge transfer and innovation. This is a critical source of future comparative advantage for Scotland. Effective and modern legal and criminal justice systems, underpinning a safer and stronger Scotland, provide an essential sound basis for conducting business and securing growth.

Many of Scotland's sectoral opportunities and its wider business competitiveness rest on the delivery of a greener Scotland. Scotland has significant potential in renewable energy and can build on current good practice to take an international lead in building sustainable food and tourism industries. A greener Scotland will also open up opportunities for businesses to extract value from what would otherwise be thrown away.

BUSINESS SUPPORT, INNOVATION AND R&D

Enhancing the quality and focus of support for business and innovation will have a direct impact on business competitiveness and growth. Responsive, accessible business support services will allow all areas of Scotland to contribute to and benefit from a shared approach to economic growth. This support needs to stimulate demand for investment, innovation and skills in pursuit of higher productivity and increased competitiveness.

Innovation - developing new processes, products and markets, often through incremental change - is vital across all sectors. Increasing the level of research & development ( R&D) activity and knowledge transfer between the research community and industry are key drivers of innovative activity, particularly in science and technology related sectors, helping to boost productivity and sustainable growth 36.

The enterprise networks will now be focused on supporting investment and innovation by companies and sectors which have growth potential and are of national or regional significance. They will therefore have a key role to play in delivering this objective, along with local authorities which will assume responsibility for supporting local businesses serving local markets.

KEY SECTORS

Securing faster, more sustainable growth will require increased performance across the economy. Some sectors and firms offer the opportunity to strengthen Scotland's areas of international comparative advantage, through achieving critical mass and boosting productivity. Sectors have the potential to make a significant contribution to increasing Scotland's growth where:

  • Scotland has distinctive capabilities and businesses with the potential to be internationally successful in areas of global demand;
  • they currently account for a significant part of the Scottish economy and reflect the contribution of all areas of Scotland; and
  • government intervention can make a significant difference to future success by facilitating or accelerating development in areas where the market alone cannot deliver the best outcome.

This will allow us to build on and expand established areas of comparative advantage such as financial services and energy. Scotland's oil and gas industry demonstrates how we can continue to prosper, with a cluster of supply-chain companies developed at peak periods of production now evolving into a critical mass of high-value, internationally-orientated activities. Our approach will vary between industries according to their strength on each of the criteria and we will continue to support enterprises from across Scotland in other sectors where our actions can overcome well-defined weaknesses in markets, and where businesses can make a significant impact on the Scottish economy. The strategy should not be to pick individual companies as winners - the market does that. Rather, the job of government should be to facilitate and accelerate the growth sectors and to provide the necessary environment to make sure that it happens in Scotland 37.

Again, support for Scotland's priority industries will be an important focus of activity for both Scottish Enterprise and Highlands & Islands Enterprise. They will also work closely with VisitScotland to support the tourism sector.

TAXATION

Evidence from other countries demonstrates the importance of taxation on the business environment 38. The experience of Ireland and Finland demonstrates that in the right circumstances lower business taxation can deliver economic growth alongside increased tax revenue 39. We currently have limited ability to affect national taxation, with much greater scope to adjust local taxation to support our objectives.

Box C2 sets out the key strategic approaches and policies which we will pursue in addressing this priority.

BOX C2: SUPPORTIVE BUSINESS ENVIRONMENT -KEY STRATEGIC APPROACHES AND POLICIES

Business Support

Responsive and focused enterprise support, working in partnership with others in the public, private and third sectors to increase the number of highly successful, competitive businesses, and their access to skills, finance and business infrastructure. This will include actions to:

  • ensure responsive, accessible and joined-up business development services, through the de-cluttering and refocusing of public sector business support in Scotland, allowing the enterprise agencies to focus more strategically on maximising their impact on Scotland's sustainable growth, while local government focuses on local business support and regeneration;
  • address gaps in access to capital that are constraining Scottish businesses from reaching their full potential, while helping to build capacity in the investment community to remove barriers to investment;
  • provide a continued supply of the skilled people and ideas that business needs from our colleges and universities; and
  • work with businesses to stimulate improvement in work practices and productivity, ensuring Scotland's skills are fully utilised.

Targeted support to business in the pursuit of opportunities outside of Scotland and the development of internationally competitive firms. This will include actions to:

  • work in partnership with businesses with potential to be significant international players to identify development requirements;
  • support a range of product and tradable service exports and international partnership opportunities; and
  • support foreign direct investment, where it has a positive impact on the Scottish economy.

Innovation and R&D

A broader approach to business innovation in Scotland that moves beyond viewing innovation as the domain of science and technology alone and recognises the importance of working with customers, suppliers and competitors to stimulate innovation. This will include actions to:

  • influence the creation of the most appropriate fiscal and taxation regime to stimulate innovation and R&D; and
  • remove barriers to innovation and incentivise activity, including the promotion of best practice.

A clear focus on strengthening the link between Scotland's research base and business innovation and addressing low levels of business R&D. This will include actions to:

  • recognise, reflect and promote the key role of Scotland's universities and colleges as world-class assets in further developing our science base, other key sectors and the wider economy;
  • provide clear incentives through the Scottish Funding Council and other agencies to encourage colleges, universities and business to engage collaboratively in the exchange of knowledge and expertise to drive greater innovation in the economy;
  • develop a new science strategy for Scotland, outlining how science will underpin Scotland's success as a nation through developing knowledge exchange between academia and business, increasing the flow of overseas investment into Scotland's R&D base and developing the science base;
  • utilise the potential of mechanisms such as Intermediary Technology Institutes to increase the connections between Scotland's scientific strengths and global market opportunities, while ensuring the involvement of Scottish-based firms; and
  • create an annual Saltire Prize, promoting, incentivising and providing funding to the leading areas of innovation in Scotland. The first award will focus on renewable energy.

Key Sectors

A particular policy focus on a number of key sectors with high-growth potential and the capacity to boost productivity, through enhanced support across the Strategic Priorities, including the regulatory and fiscal environment:

To expand Scotland's areas of international comparative advantage, we will give particular attention to building a critical mass of activity in the following key sectors, with government helping to create the right environment for their competitiveness and growth:

  • Creative Industries (including digital content and technologies);
  • Energy (with a particular focus on renewables);
  • Financial and Business Services;
  • Food and Drink (including agriculture & fisheries);
  • Life Sciences (including biotechnology and translational medicine); and
  • Tourism

along with the technologies that contribute to the development of these key sectors.

We will also seek to take advantage of the opportunities presented by Scotland's strengths and opportunities in public sector dominated industries, including:

  • Education and Healthcare.

Taxation

A competitive tax regime which incentivises business growth and attracts mobile factors of production. This will include actions to:

  • introduce a Small Business Bonus Scheme, removing many small businesses from the business rate burden, while reducing it for others;
  • ensure that the business poundage rate in Scotland will not rise above the English rate during the lifetime of the Parliament; and
  • make the case for Scotland to have fuller, and eventually full, responsibility for tax raising and public spending, utilising this to make Scotland the lowest taxed part of the UK, dropping corporation tax significantly below the UK level.

C.3 INFRASTRUCTURE DEVELOPMENT AND PLACE

HOW WILL IT CONTRIBUTE TO DELIVERING THE GOVERNMENT'S PURPOSE?

The strength and quality of our cities, towns and rural areas is a huge asset. Harnessing the opportunities that our geography provides, through investment in our physical and electronic infrastructure and Scotland's planning, development and funding framework, is a critical role for government. We aim to make these factors enablers - rather than inhibitors - of sustainable growth.

This strategic priority will be critical to the delivery of all Strategic Objectives, particularly Wealthier and Fairer, Safer and Stronger and Greener.

Enhancing Scotland's transport services and infrastructure are key to supporting business and employment opportunities in pursuit of a wealthier and fairer Scotland. Achieving change in travel patterns and mode is one of the greatest challenges in securing sustainable economic growth and is integral to securing a greener Scotland. Connectivity also plays a key role in building safer and stronger communities. Safer and stronger communities are fundamental to the attractiveness of Scotland as a place to live and work. An effective justice system contributes to reduced anti-social behaviour and fear of crime, and our efforts to tackle discrimination and intolerance help to make life safer and to increase Scotland's attractiveness.

Our new approach to planning needs to balance the aspirations for a wealthier, fairer and greener Scotland. Above all, vibrant, connected communities and businesses with good access to markets and services are key elements of a successful and dynamic economy. In a greener Scotland our natural, historic and built environment are a source of a great deal of Scotland's wealth. Successful development of Scotland's places and connectivity depends on the quality and accessibility of the facilities and environments that deliver a healthier and smarter Scotland. In a healthier Scotland, healthier environments can enable healthier lifestyles, contributing to the productivity of the labour force.

TRANSPORT

An efficient transport system is one of the key enablers for enhancing productivity and delivering faster, more sustainable growth 40. Enhancing transport infrastructure and services can open up new markets, increase access to employment and help to build a critical mass of businesses that drive up competitiveness and deliver growth 41.

PLANNING AND PLACE

Achieving our Purpose in government requires a planning framework that both protects the quality of Scotland's natural and built environment as an asset for sustainable economic growth and enables the development of growth-enhancing activities across Scotland, including rural areas.

Scotland's cities are particularly important as centres of growth and prosperity. In addition to having more economic activity (see Figure C.1), cities are also generally more productive, sharing access to business services, skilled labour pools and knowledge networks 42. For Scotland's cities to realise their full potential, they need to better reach out to, and benefit from, the workforce and other assets in urban and rural areas in and around them. This includes improving connections between Scotland's cities to offer an attractive combined proposition for mobile investment and skilled labour. Delivering connectivity that allows businesses to benefit from the increased choice and opportunities has a real impact on reducing their costs and increasing their competitiveness 43.

To this end, an effective housing market, including a good supply of affordable housing is key. By ensuring that the housing and planning systems are responsive to demand, we will improve affordability, particularly for first-time buyers, and increase effective labour supply in growing areas.

Effective regeneration, by linking opportunities with need, will increase participation and help realise the potential of our places. Scottish Enterprise will continue to deliver economic development projects of regional or national significance while local regeneration activity will be the responsibility of local authorities in lowland Scotland. Highlands and Islands Enterprise will, however, continue to have responsibility for local regeneration as it is a necessary element of its remits to strengthen communities.

Box C3 sets out key strategic approaches and policies which we will pursue in addressing this priority.

Figure C1: Gross Value Added by area, 2004

Figure C1: Gross Value Added by area, 2004

Source: Scottish Government, Office for National Statistics

BOX C3: INFRASTRUCTURE DEVELOPMENT AND PLACE - KEY STRATEGIC APPROACHES AND POLICIES

Transport

To focus investment on making connections across and with Scotland better, improving reliability and journey times, seeking to maximise the opportunities for employment, business, leisure and tourism. This includes actions to:

  • clearly identify projects of economic significance and enhance the alignment of decisions to Strategic Objectives; and
  • complete and implement the strategic review of investment in Scotland's transport infrastructure and services, geared to delivering real benefits to businesses and communities while ensuring value for money.

To provide sustainable, integrated and cost effective public transport alternatives to the private car, connecting people, places and work, across Scotland.

Planning and Place

A planning and development regime which is joined up, and combines greater certainty and speed of decision making within a framework geared towards achieving good quality sustainable places and sustainable economic growth. This will include actions to:

  • publish a second National Planning Framework, focused on sustainable growth, setting out how improvements in national infrastructure will support that growth, more effectively aligning planning and development priorities across the public sector to lever greater private sector investment, including the critical importance of National Developments;
  • implement a more streamlined approach to planning across urban and rural Scotland, including Strategic Development Plans to help create well-planned critical mass around and across Scotland's major city regions, and Development Plans in other areas, both of which will provide greater certainty and speed of decision-making;
  • facilitate greater collaboration between Edinburgh and Glasgow and their surrounding areas to develop a city region with the scale and quality of assets (including quality of built and natural environment) that can compete with leading cities globally for mobile people, business and investment, with delivery bodies working across conventional boundaries;
  • through the Housing Supply Task Force, bring key delivery agents together in order to deliver a more responsive housing system and more affordable, well designed, energy efficient housing to meet the growing demands of increasing numbers of households in both urban and rural Scotland; and
  • seek to deliver better value arrangements for the financing of public infrastructure investment, through the Scottish Futures Trust.

C.4 EFFECTIVE GOVERNMENT

HOW WILL IT CONTRIBUTE TO DELIVERING THE GOVERNMENT'S PURPOSE?

The public sector itself accounts for over 20 per cent of Scotland's economic output 44. Recent research indicates that there are only two EU15 economies where government expenditure accounts for a higher percentage of GDP than in Scotland 45. The public sector is Scotland's largest consumer and dominates two of Scotland's largest industries - education and healthcare. The efficiency and effectiveness of the public sector, therefore, has a major direct impact on the performance of the Scottish economy. The success of this Strategy depends on effective implementation by a customer-focused and responsive public sector across all five Strategic Objectives. Each of the Strategic Objectives has a significant contribution to make to delivering more effective government.

A key part of delivering a wealthier Scotland is to ensure the Government supports, while not displacing, business. We can do this through more effective use of public sector procurement and through creating a regulatory climate that balances the costs of regulation with the need to ensure a safer, fairer, healthier and greener Scotland 46.

Creation of a healthier and smarter Scotland largely depends on direct public sector provision, emphasising the importance of more effective organisation and delivery in the NHS and across education. Elsewhere, there remain significant opportunities for efficiencies through organisational de-cluttering, including, for example: a single environment and rural service for businesses in pursuit of a greener and wealthier Scotland; and reform of performance management in criminal justice and policing in pursuit of a safer Scotland.

As a small country, Scotland's public sector can utilise more effectively its potential advantages of speed in decision-making, nimbleness and co-ordination. In short, become a more enterprising Government. We have moved to streamline our activities and focus efforts on achievement of the five Strategic Objectives. Learning from the experience of Virginia - considered among the best managed states in the US - we are developing new management and monitoring arrangements to improve accountability, create incentives and drive progress, in parallel with simplifying the public-sector delivery landscape and joining up activities.

Virginia's Performance and Benchmarking System

The 'Virginia Model' ensures the strategic goals of government drive prioritisation and delivery. Seven long-term strategic goals, and related indicators, which were agreed in an intensive process involving stakeholders, are at the core of strategic planning and communications tool designed to drive significant change in leadership behaviours and service delivery culture.

The framework has been used to link the agencies contributing to the state's performance into delivery of the strategic goals. Relationships previously focused on funding and management processes are now driven by results and outcomes.

Box C4 sets out key strategic approaches and policies which we will pursue in addressing this priority.

BOX C4: EFFECTIVE GOVERNMENT - KEY STRATEGIC APPROACHES AND POLICIES

More effective government with a clear focus on achieving higher levels of sustainable economic growth through the delivery of the Purpose and five Strategic Objectives. This will include actions to:

  • build on the new more focused structure of the Scottish Government by reducing duplication, bureaucracy and overlap across the public sector in pursuit of greater efficiency, effectiveness and, importantly, speed of delivery. We will deliver annual efficiency savings which will release significant resources for key priorities to support economic growth;
  • ensure that government intervention does not crowd out private sector activity or reduce incentives for growth in the private sector;
  • ensure that the public sector provision of key services is responsive to the needs of business;
  • utilise the expertise of the Council of Economic Advisers and the National Economic Forum to guide the Government's effective pursuit of faster, more sustainable economic growth; and
  • ensure Scotland's interests are heard in London and Brussels.

Streamlining the Scottish Government's direct dealings with business, including better regulation and more efficient procurement practices. This will include actions to:

  • re-invigorate the Regulatory Review Group to address the streamlining of regulation, reducing unnecessary burdens on business, while ensuring appropriate regulations impact effectively on fairness, safety and sustainability. An early step will be to create a single environment and rural service for businesses;
  • use public procurement to maximum effect so that the public sector makes better use of its purchasing power to help deliver sustainable economic growth;
  • accelerate take-up of e-Procurement Scotland to make selling to the public sector easier and to increase access to government contracts for businesses of all sizes; and
  • involve business more effectively across the work, and in the direction, of government activities to build consensus on our economic future.

C.5 EQUITY

HOW WILL IT CONTRIBUTE TO DELIVERING THE GOVERNMENT'S PURPOSE?

Delivering sustainable growth with opportunities for all is at the heart of the Government's Purpose. Our three "golden rules" of growth - solidarity, cohesion and sustainability - reflect the intrinsic importance of social equity, regional balance and respect for the environment among Scotland's diverse people. However, as well as being a desirable outcome and characteristic of growth, addressing social, regional and inter-generational equity is also a key driver of economic growth.

This Strategic Priority will be critical to the delivery of all Strategic Objectives. Creating the conditions for growth and cohesion, together with enhancing our environment are critical to our growth and prosperity.

Delivering safer and stronger communities and equality of opportunity for all groups underpins the creation of a wealthier and fairer Scotland. Changes to local taxation will promote a fairer Scotland.

In a smarter and healthier Scotland, improving the life chances for children, young people and families at risk and sustaining and improving the health of people in disadvantaged communities will allow them to realise their economic potential. In a safer and stronger Scotland, reducing crime and re-offending will improve life chances of offenders, their families and communities, increasing their capacity to participate fully in the economy. Education and training of offenders, along with drug and alcohol treatment and mental health interventions, will enhance their employability. In a greener Scotland, creating economic opportunities associated with Scotland's environment will help rural households to achieve greater wealth while enhancing and protecting the environment for future generations.

In pursuit of a fairer Scotland, the drive towards becoming a Fair Trade Nation supports the solidarity, cohesion and sustainability targets, and extends our responsibility beyond Scotland, to play an active role in supporting trade justice across the globe.

Effective alignment of services and investment from across the Strategic Objectives - e.g. transport, healthcare, education, justice, economic development - will be crucial in delivering greater regional cohesion across urban and rural Scotland. Harnessing the pursuit of a wealthier Scotland in areas such as transport, planning, business resource efficiency and renewable energy is at the core of delivering a greener Scotland.

SOLIDARITY: SOCIAL EQUITY

The experience of Scotland's neighbours in the Arc of Prosperity demonstrates the successful combination of low levels of income inequality and high levels of economic growth. Nearly a million people in Scotland remain in relative low-income households. Increasing social equity in Scotland has the potential to reconnect large numbers of people in disadvantaged groups and communities to the mainstream economy, fulfilling their potential, increasing participation and growth and building stronger and safer communities.

COHESION: REGIONAL EQUITY

Sustainable growth and prosperity need to be shared across Scotland. At present, differences in income, participation and growth across Scotland act as a drag on our economic performance and potential. Increased participation and enhanced quality of employment across our cities, towns and rural areas will enhance our performance and deliver a more inclusive Scotland so that, no matter where people live, opportunities are open to them.

SUSTAINABILITY: INTER-GENERATIONAL EQUITY

The quality of Scotland's environment and natural heritage is a key asset and a source of comparative advantage. Protecting and enhancing Scotland's biodiversity and landscape for future generations is central to both our current and future competitiveness.

Pursuing an environmentally sustainable model of economic growth is not one which need constrain economic growth; rather, it offers opportunities for growth enhancement, particularly in Scotland. Innovating to address resource efficiency and waste reduction across the business base increases both competitiveness and sustainability. Across both private and public sector, further development of our research strengths in environmental science and technologies will contribute to a greener Scotland and increase our impact on environmental sustainability globally.

Our research base also points to sectoral opportunities to boost both growth and sustainability. Support to ensure our renewable energy sector's development as a world leader will be key to driving a more environmentally sustainable Scotland. Pressure to reduce 'food miles' opens up significant opportunities for Scotland's food production, processing and distribution industry, while Scotland is building its profile in the eco-tourism market.

Box C5 sets out key strategic approaches and policies which we will pursue in addressing this priority.

BOX C5: EQUITY - KEY STRATEGIC APPROACHES AND POLICIES

Solidarity: Social Equity

To provide the opportunities - and incentives - for all to contribute to Scotland's sustainable economic growth. This will include actions to:

  • ensure access to public services, including business support and transport, is enhanced across Scotland and that equity of provision is a central consideration in decision making;
  • freeze Council Tax in preparation for replacing it with a fairer Local Income Tax, which will mean the vast majority of households will pay less;
  • focus the Government's policy across our Strategic Objectives on reducing inequality in Scotland and influence the UK Government to ensure welfare reform addresses Scotland's social equity issues;
  • legislate to abolish the Graduate Endowment fee and progress wider plans to ensure that access to higher education is based on the ability to succeed rather than the ability to pay;
  • support social enterprise, as part of investment in an enterprising third sector, ensuring the provision of start-up assistance and encouraging efforts to provide supported employment as an early step for those furthest from the labour market;
  • ensure that support is provided to improve the life chances of those most at risk;
  • ensure that young people who need more choices and more chances have access to these;
  • provide high quality, reliable childcare that can give those furthest from employment confidence to take initial steps towards employability; and
  • make the case for Scotland to have fuller, and eventually full, responsibility for personal taxation and benefits, to allow the development of an approach to equity and boosting economic activity that fits with Scottish circumstances.

Cohesion: Regional Equity

To accord greater priority to achieving more balanced growth across Scotland, to give all across Scotland the chance to succeed. This will include actions to:

  • implement single outcome agreements to target the transformation of areas of lowest economic activity, with a focus on Scotland's urban regeneration priorities;
  • ensure a more strategic approach to the growth of Scotland's, cities, towns and rural areas across transport, planning, housing and economic development;
  • build on the fuller utilisation of electronic connectivity;
  • ensure the most remote areas of Scotland can contribute to, and benefit from, economic growth; and
  • implement the Scotland Rural Development Programme (currently under consideration by the European Commission) to develop the rural business base, communities and environment.

Sustainability: Inter-generational Equity

To promote economic growth and environmental quality and responsibility as mutually advancing. This will include actions to:

  • ensure Scotland's planning framework and strategic transport investment drive an approach to economic growth that allows Scotland to improve the quality of the environment and to meet our ambitious emission reduction targets;
  • mainstream resource efficiency and waste management as part of our business support activities;
  • build on the launch of the Saltire Prize and addressing connection charges for renewable energy, by prioritising the development of the renewable energy sector alongside addressing the opportunities emanating from the global environmental challenge in other industries such as food and tourism; and
  • ensure the regulatory environment supports the growth of Scotland's renewable energy sector and lead the development of the North Sea grid to allow Scotland's renewable resources to supply markets across Europe.

Each part of the Strategy covers a range of target groups of individuals, businesses and other organisations. To ensure that the equalities implications of each policy area on its relevant audience are fully considered, an equality impact assessment will be undertaken. This will be conducted across six strands (race, disability, gender, sexual orientation, age and religion/faith) and monitored thereafter to make sure that they are appropriate, to mitigate against any potential negative impact and to ensure that our policies are as robust and effective as they can be for as many people as possible.

Page updated: Monday, November 12, 2007