Better Regulation: supporting economic growth and investment

1. Executive summary

As part of the 2025-2026 Programme for Government, the Scottish Government committed to review existing regulation across three key sectors in Scotland’s economy to ensure that regulation supports investment and growth and makes it easier to do business.

Starting with the priority sectors of housing, public infrastructure, and green industries, we engaged with businesses, investors, and representative organisations to understand where regulation – in its content or delivery – may be unintentionally constraining economic growth.

In the course of our discussions, we asked stakeholders to identify any specific devolved regulations that they considered were no longer fit for purpose, and which should be repealed or modified to better support investment and ease of business in Scotland.

This is not an exercise in de-regulation, but in regulating better. We also therefore asked stakeholders to identify specific regulatory practices for review, where the manner of implementation of regulation in Scotland has the unintended effect of making business more costly or uncertain.

Business and investors have praised the overall stability, robustness, and governance of Scotland’s regulatory system. Stakeholders routinely shared positive examples of regulators taking forward pragmatic, innovative, and forward-looking approaches. We highlight some examples of good practice in this report. We have a strong foundation upon which to build.

However, we also received feedback on the complexity and inconsistency of regulatory delivery, the need for more responsive regulation that isn’t overly precautionary in its approach, the cumulative burden and cost of regulatory requirements, inconvenient digital systems, and the need for greater integration and alignment across government and regulators.

This action and implementation plan sets out our response to that feedback and the work we are undertaking or planning to address the issues and themes identified during our engagement.

Businesses operating and investing in Scotland engage with a range of government functions. We therefore also welcomed broader feedback on government and regulatory processes impacting business decisions. This included commentary on planning, procurement systems, and challenges in navigating local, Scottish, UK and international regulatory requirements. This publication outlines where we are streamlining and improving systems and requirements.

In addition, this action plan sets out that we:

• Have established a Scottish Regulators Forum to strengthen collaboration, share best practice and facilitate discussions on how regulators assess risk and balance regulatory controls against our investment and economic growth aims and economic growth duties that apply to them.
• Will review and refresh the Scottish Regulators’ Strategic Code of Practice to promote proportionality, transparency, and our Better Regulation principles.
• Will continue using the Regulatory Review Group^[1] and Business and Regulatory Impact Assessments to scrutinise new regulation.
• Will continue our work to ensure Scottish businesses benefit from UK Government regulatory workstreams, recognising that while this review was concerned with devolved regulation, businesses often operate across regulatory regimes.
• Will remain receptive to suggestions for targeted regulatory interventions to support business in Scotland.
• Have begun work with partners to reform regulatory barriers in the housing sector associated with the road bonds system.

We also detail relevant ongoing workstreams improving the regulatory and compliance environment, including Energy Performance Certification, Heat in Buildings and Public Service Reform. A summary of actions can be found in Annex D.

We want to ensure an effective balance between regulation to protect the things that we value, and minimise unnecessary or overly burdensome costs on businesses and citizens. Beyond this work, we remain committed to engaging with stakeholders to create a regulatory environment that supports investment, innovation, and economic growth.