Scotland's creative economy
Scotland's arts, culture and creative economy is an important source of employment and makes a valuable contribution to our wider economic and social wellbeing. This includes significant interlinkages with other key sectors such as tourism and hospitality. These sectors will play a valuable role in a thriving independent Scotland.
As outlined in the third paper in the Building a New Scotland series, 'A Stronger Economy with Independence', Scotland's creative sectors are strong, dynamic, and innovative, and are important enabling sectors for other parts of the economy.
The government of an independent Scotland would have the powers to prioritise areas that matter to Scotland, including long-term support for our creative economy. Independence will give the Scottish Government and Parliament the powers to make important fiscal decisions about the cultural sector which are currently reserved to the UK government.
This section first sets out the strengths and economic contributions of Scotland's creative economy, and its importance as an asset to an independent Scotland. It then discusses some of the ways in which this important economic sector could benefit from the additional powers available with independence.
Flourishing creative industries
The arts, culture and creative sector, which also covers screen, software publishing and computer game design, is an important economic sector for Scotland. Latest data for the sector show that it employed 155,000 people in 2022, and contributed £4.4 billion gross value added (GVA) to Scotland's Economy in 2020.
In March 2022, there were 13,285 registered enterprises operating in the 'Creative Industries growth sector', representing 7.6% of all registered business in Scotland.
Scotland's music sector, for example, has a global reach, with Scottish artists showcasing throughout the world. Already, there is a global market for a wide range of genres from traditional to post-rock, and from indie to classical. The prominence of Scotland's artists at festivals around the world such as South by Southwest, Rudolstadt Festival, and the Festival Interceltique de Lorient is testament to this, as is the interest and participation from artists around the world in Scotland's international cultural festivals such as Celtic Connections and Sonica.
And there is still untapped potential, with new artists emerging all the time with the talent and energy to bring their work to wider audiences. Scotland's diverse and renowned music sector will be an asset to the culture, economy and international reputation of an independent Scotland, and with independence, the Scottish Government will have further opportunities to support it to reach wider audiences and develop opportunities for those working in the sector.
Moreover, with major growth in recent years, the success of Scotland's video games sector is an exemplar of how the Scottish creative industries can be world leaders and influence the international market. Already, its rapidly increasing value to Scotland's economy is notable, with a GVA of £139 million in 2021 – an increase of £111 million in the decade since 2011. It has also seen rapid growth in employment, with the numbers employed by the sector almost doubling between 2015 and 2022.
It is a sector at the cutting edge that is dynamic, vibrant and thriving, and has given gamers worldwide some of the most beloved and influential titles ever created, from classics like Lemmings to the huge range of games, people, and companies that make up the sector today. Events such as Scottish Games Week have played an important role in bringing the sector together in Scotland, sharing knowledge and showcasing its talent.
Dundee in particular has been at the forefront of worldwide computer games development and innovation, with a wide range of hugely successful start-ups and a leading university. Having launched the world's first computer games degrees in 1997, Abertay University is now ranked number one in Europe for video games education. Six more universities in Scotland offer games-related degrees, including the Glasgow School of Art qualification in games and virtual reality.
Scotland on screen
The screen sector, too, is an important creative industry for Scotland. In recent years, the film, TV and broadcasting sector in Scotland has grown substantially, making a significant contribution to the economy, promoting tourism to Scotland, and boosting Scotland's profile on the world stage.
Screen Scotland have published a report which showed that the screen sector in Scotland contributed £567.6 million GVA to Scotland's economy in 2019, providing 10,280 full time equivalent jobs. It also demonstrates the value of the screen sector to other parts of Scotland's economy, including hospitality and tourism. Scotland's studio infrastructure has grown significantly in recent years, with new and refurbished facilities across the central belt and beyond, increasing Scotland's ability to play host to domestic and international productions of all types and sizes.
Scotland's screen sector not only provides fulfilling employment and opportunities to people in the creative industries and more broadly, it also has unique value in promoting Scotland's profile internationally, helping to forge new cultural links, opening up new international markets, and attracting inward investment.
Already, the sector attracts producers from around the world. In 2019, producers based outside of Scotland spent an estimated £165.3 million on the inward production of films and high-end TV programmes filmed on location or in studio facilities in Scotland, demonstrating Scotland's international attractiveness.
Re-joining the EU, and gaining control over visa and immigration pathways, would allow the brightest talents to choose Scotland to bring their stories to life, allow Scottish talent to stay in Scotland, and attract the best of talent globally. As this paper has set out, barriers created by Brexit have restricted this development in the creative sectors.
The Scottish Government has demonstrated its commitment to the screen sector in recent years by establishing the specialist agency, Screen Scotland, and providing funding to support domestic production, inward investment and the sustainable future of the sector. This has led to increased talent and business development, and production of a huge range of films and television programmes – everything from shorts by budding local creators, to big-budget, globally successful franchises.
In an independent Scotland, the Scottish Government would continue to support the thriving screen sector, building on successes to date and ensuring that our nation continues to attract productions and companies that make a real and lasting contribution, including through development of Scottish talent and skills. Following a vote for independence, this Scottish Government would be committed to matching UK tax relief for qualifying film and high-end TV production.
Other incentive schemes for the screen sector have found success in countries such as the Republic of Ireland and Iceland. A study commissioned by Screen Ireland found that 89% of incoming production expenditure to the Republic of Ireland can be attributed to the film and television tax credit incentive that exists.
Measures such as these could enable growth in the number of companies and filmmakers doing business in Scotland and encourage continued growth in our screen and broadcasting sectors, and wider creative industries. Introducing similar measures could be an option open to future governments of an independent Scotland, depending on the overarching fiscal environment.
Independence would provide further opportunities to broaden and enhance our growing production infrastructure, including our increasing range of studios which already attract film and television productions to Scotland from some of the biggest global production companies.
Scotland's cultural heritage is a major driver of tourism, which in turn contributes to Scotland's economy. In 2015 and 2016, a third of overall visitors and around half of international visitors were attracted to visiting Scotland due to its rich history and culture.
In 2021, the Sustainable Tourism Growth Sector contributed around £3.3 billion of GVA to Scotland's economy, around 2% of the total. The most recent employment figures estimate that the sector employed 209,000 people in 2021, which represented 8% of Scotland's workforce. In 2022, there were 3.2 million international overnight visitors to Scotland, spending around £3.2 billion.
The heritage sector played an important part in local economic development and in tourism recovery following the COVID-19 pandemic. In 2022, the top 5 most visited attractions in Scotland were all heritage related, comprising the National Museum of Scotland with 2 million visits, Greyfriars Kirkyard (2 million), Edinburgh Castle (1.3 million), Scottish National Gallery and Museum (1.38 million) and Riverside Museum (1.2 million). The historic environment generated an estimated £2.7 billion for Scotland's national and regional economies in 2020 (£4.4 billion in 2019, £4.2 billion in 2018, £3.6 billion in 2015). Scotland's cultural heritage, and the tourism sector it supports, would be further boosted by an independent Scotland re-joining the EU and further powers to promote the sector internationally.
Following independence, this Scottish Government would propose that the National Lottery continues to operate in Scotland. Currently, the licence to run the National Lottery is held by Camelot Group plc. but following the award of a new licence from February 2024, it will be run by Allwyn for the subsequent ten years. Creative Scotland distributes National Lottery funding to cultural organisations across Scotland. This includes through their Open Fund for individuals and organisations.
Following a vote for independence, the Scottish Government would work with the licence holder to give residents of an independent Scotland continued access to the National Lottery for the remainder of the licence term. This would mean people in Scotland would continue to be able to play National Lottery games, and the infrastructure enabling them to do so would remain in place.
While an independent Scotland remains part of a UK-wide lottery, the Scottish Government would negotiate to form a new regulatory relationship with the lottery operator in line with the terms of the licence, with terms which ensure an equitable apportionment of good cause money across Scotland. Responsibility for appropriate oversight of the operation of the lottery in Scotland would also be the responsibility of an independent Scottish Government.
Following the expiry of the relevant licence, future Scottish Governments would be able to decide whether to continue with the existing arrangement or to establish a distinct Scottish National Lottery.
Support for creative industries
Independence would provide Scotland with the full range of policy levers to influence the wider economy in which creative businesses operate, and creative people live and work, to effectively safeguard and support the sector.
Further to the sectoral proposals set out above, the rest of this section outlines options open to the governments of an independent Scotland to support the creative industries.
Box 6 gives an overview of some of the key additional powers which would come with independence.
Box 6: Supporting Scotland's creative industries with independence
Independence would give the Scottish Government the powers to support our creative industries in a wide range of different ways, including:
Migration policy: an independent Scotland would design a visa and immigration system that serves the needs of all parts of the economy, including our creative industries, with routes to allow access to skills and talent from around the world without onerous barriers
International promotion: the establishment of a global network of embassies with integrated culture sections would help to develop international networks to support Scottish cultural exports, and would provide a platform to showcase Scotland's creative industries internationally
EU membership: with EU membership, Scotland's creative industries would have unrestricted access to the EU market, and access to EU programmes which would provide an important source of funding and facilitate cross-border projects and collaboration. Fundamentally, freedom of movement would allow those working in our creative industries to access this vital market with minimal barriers
Economic measures: with independence, the Scottish Government would have the full autonomy to take decisions over tax, spending and borrowing, supported by key fiscal institutions and the necessary governance frameworks. This would mean a range of policy options would be available to provide tailored support to sectors of the Scottish economy, such as creative industries
Migration and EU membership
As a member of the EU, creative industries would benefit from free movement, welcoming creative professionals in the EU to join the sector in Scotland more easily once again. Re-joining the EU would also support touring artists and allow creative professionals to move freely without barriers like visa and customs requirements when working in other EU countries.
An independent Scotland could also design visa and immigration routes that meet the needs of our culture, events and creative sectors more effectively, and help to foster cross-border cultural exchange.
This approach could support the sector to attract the skills it needs from around the world and help to foster cultural collaboration, learning and partnerships between creative professionals in Scotland and elsewhere in the world. This would help to make the sector more resilient, diverse and vibrant.
Further details on how EU membership and migration could support culture in Scotland are set out above in the section 'Scotland on the world stage'.
The support provided by government and public bodies can be vital in helping our culture and creative sectors to develop and thrive, particularly as the sector recovers from the impact of the COVID-19 pandemic. Future governments of an independent Scotland could support these sectors further.
With independence, the Scottish Government would have the autonomy to take decisions over tax, spending and borrowing to meet Scotland's needs. This would be supported by key fiscal institutions and the necessary governance framework.
The government of an independent Scotland would also have the power to issue its own sovereign debt and have the full range of powers necessary to set fiscal limits, undertake investment, and support all sectors of the Scottish economy, including our creative economy.
Tax support has been an important tool in supporting our vital cultural institutions in times of crisis. Additional support for orchestras and theatres, along with museums and galleries, has been a lifeline throughout the COVID-19 pandemic and the cost of living crisis. It has been important in supporting vital institutions such as our National Performing Companies and Scotland's wider cultural ecosystem.
As part of the UK, however, these measures have acted only as a form of emergency support in times of crisis. Independence would give the Scottish Government and Parliament the powers to make important fiscal decisions about the cultural sector which are currently reserved to the UK Government.
To help put the sector on a firmer financial footing, including supporting the recovery of the sector from the effects of the pandemic, following a vote for independence, this Scottish Government would be committed to matching UK tax relief for film and tv production, theatres, orchestras and museums and galleries through support and incentives. Future Scottish Governments could also explore the opportunities for further competitive international tax advantages with the sector.
The Scottish Government will also learn from the impact of tax measures that have been put in place in other countries, such as Ireland, which relate to income earned by writers, composers, visual artists, sculptors and others from the sale of their work. Such measures could play a role in helping to ensure that Scotland's creative professionals have the support and stability that they need.
Collaboration and innovation
Membership of international programmes such as Creative Europe or institutions like UNESCO, as set out earlier in the paper, could support the protection of culture in Scotland and around the world.
An independent Scotland would have the opportunity to further support creativeindustries through maximising opportunities for collaboration, research and knowledge exchange across countries and governments, culture sectors and academia, amplifying the economic potential of the creative industries.
Since Brexit, UK participation in Horizon Europe, including its funding cluster on Culture, Creativity and Inclusive society, has been on hold. While the UK Government has recently re-joined the programme as an associate member, institutions have lost out on nearly three years' worth of valuable funding.
Rather than the UK Government's associate member status, independence would give Scotland the opportunity to be directly represented in the European Council and European Parliament meetings which decide the overarching rules for Horizon Europe. Scotland would also have a formal vote in the Horizon Europe programme committees which decide the priorities for call for proposals.
As technology and innovation advances in the sector, it is vital that creatives in Scotland can harness this and bring their work to a global audience. In an independent Scotland, the Scottish Government could support creatives to have access to the benefits of emerging technologies such as Artificial Intelligence (AI), while having control over necessary safeguards regarding the proliferation of AI technology and AI generated content.
International promotion and support for exporters
As outlined in the section 'Scotland on the world stage', an independent Scottish Government would be able to establish its own network of embassies around the world with integrated cultural sections, giving tailored support to the Scottish sector internationally.
Building on the 'Scotland House' model, this would support international promotion of the culture sector with key international partners and help to build new markets for cultural exports in strategic locations.
The powers over international trade that independence would bring could also help realise the potential of Scotland's culture and creative sectors internationally. As 'Building a New Scotland: A stronger economy with independence' sets out:
Becoming an independent country and re-joining the European Union inside the world's biggest single market, are of paramount importance if Scotland's international trade potential is to be achieved.
That paper explains that an independent Scotland would have for the first time:
- a new government ministry with specific trade related responsibilities, including the promotion of Scottish exports, and
- a dedicated network of overseas missions in EU capitals and beyond which, for the very first time, would mean Scotland having a network of international offices with full diplomatic status and a core purpose to promote Scotland as a hub for innovation, trade and investment
Alongside any economic benefits, supporting the culture sector abroad could also help to further promote Scotland's profile on the world stage and attract inward investment.
A fairer creative economy
As an independent country, Scotland could do more to ensure that our creative economy is a fairer one. 'Building a New Scotland: A stronger economy with independence' set out that powers areas like employment, such as setting a national minimum wage, could allow the Scottish Government to embed Fair Work principles throughout our economy, including in the culture and creative sectors. This could help to support the incomes of those working in the sector and enable the government of an independent Scotland to put in place schemes to support emerging artists and others to realise their potential, particularly at the start of their careers.
Fair Work is a key driver for achieving sustainable and inclusive economic growth and a wellbeing economy. Scotland's culture and creative sectors can play a key role in moving towards a wellbeing economy that values and promotes things like cultural identity and civic engagement.
In 2022, Creative Scotland published a review of Fair Work in the creative and cultural sectors in Scotland to consider Fair Work, leadership, workforce and skills development in the sector. The Scottish Government's Culture Strategy Action Plan Refresh will also set out further tangible actions to continue to support the cultural workforce and embed principles of Fair Work in the sector.
With independence, future Scottish Governments would also be free to explore new and innovative ways of supporting our creative workforce and support creative professionals to be fairly and sustainably renumerated for their work.
'Building a New Scotland: Social security in an independent Scotland' sets out options for a new social security system with independence that could be relevant to those working in the culture sector. These include the possibility of working towards a long-term ambition of delivering both a Minimum Income Guarantee (MIG) and a Universal Basic Income. The Scottish Government is already exploring, with an expert group, the practical implications of a introducing a MIG, and the paper sets out key principles for a MIG, including the following:
A Minimum Income Guarantee is an ambition that would enable all households to live with financial security.The guarantee could be delivered through employment and employment support, social security, the tax system, and by reducing or removing essential costs that can be met through fair and equal access to wider collective services, such as social care and childcare. This would also include a targeted payment for anyone that falls beneath the Minimum Income Guarantee level.
Ultimately, with independence, future Scottish Governments would have full powers over both fiscal policy and economic policies which could play a key role in boosting tax revenues. This would allow them to take decisions which ensure that Scotland is fiscally sustainable, while prioritising support for public services and investment, and rejecting the 'austerity' approaches imposed on Scotland by UK Governments in the recent past. Under independence, Scottish Governments would have the full range of policy options needed to provide appropriate support and investment to our creative economy.
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