Scottish draft Budget 2018-2019: equality statement

Chapter 8
Economy, Jobs
and Fair Work

Introduction

The Economy, Jobs and Fair Work portfolio plays a crucial part in fulfilling the Scottish Government’s purpose of supporting Scotland becoming a more successful country, with opportunities for all to flourish through increasing sustainable economic growth. It covers a range of areas, from employability, enterprise, skills and fair work to City Region Deals, enterprise and energy.

Scotland is a wealthy country, but economic inequalities continue to exist. There is considerable variation in economic performance across Scotland. ^[1] Women, disabled people and ethnic minorities are less likely to be in employment ^[2] and those who are in work earn less on average or are more likely to live in poor households than men, ^[3] non-disabled people ^[4] and white people. ^[5]

The Scottish Government also recognises that inequalities experienced are often multi-dimensional. This portfolio has an important role in not only improving access to work for disadvantaged groups but also ensuring those in work have a positive experience of fair work, and to promote equality in the opportunities and outcomes offered by this budget.

Key Strategic Priorities

This portfolio plays a central role in supporting and delivering Scotland’s Economic Strategy. This is based on the twin pillars of increasing competitiveness and tackling inequality. The two mutually supportive pillars are reinforced by the four ‘Is’, the strategic priority areas for action identified in the Strategy: investment, innovation, internationalisation and inclusive growth.

Inclusive growth is of ever-increasing importance on the national and international stage. Following Scotland’s international inclusive growth conference in October 2017, there is increasing international recognition of the work that the Scottish Government and partners have achieved so far and continue to commit to going forward.

Equality Implications Of The Draft Budget 2018-19

Employability

Employability and Training programme budgets play an essential role in delivering the Scottish Government’s aims of tackling poverty, promoting inclusion and social justice, and creating a fair and prosperous Scotland, and will benefit from a net increase of
£9.9 million in 2018-19. This will ensure that this government delivers on its Programme for Government commitment to invest an additional £20 million each year for employability services, over and above funding transferred from Westminster. The investment made in employment and training support provides an important contribution to inclusive growth and the innovation element of Scotland’s economic strategy, encouraging service providers to seek new ways to help people into sustained work.

Fair Start Scotland, an employability support service which helps people find and retain work, will benefit from £13.3 million in 2018-19. The service will target disabled people, people with a health condition as defined in the Equality Act 2010, people with convictions, care leavers, lone parents, refugees, ethnic minorities, people in the 15 per cent most deprived Scottish Index of Multiple Deprivation ( SIMD) areas, people with health issues which present a barrier to employment, and people who have been unemployed for two years or more. The programme was designed with equality considerations from the outset and will have a significant impact on addressing inequality in Scotland. For instance, it will play an important role in the Scottish Government’s ambition of halving the disability employment gap.

Enterprise and Innovation

Our investment through our enterprise agencies contributes to the delivery of Scotland’s economic strategy, supports innovation and internationalisation, and ensures inclusive growth is at the heart of all they do.

The budget for Scottish Enterprise ( SE) is being increased by £50.7 million. At this stage, it is not possible to know how SE will use this or to assess what the equality impacts will be. It will, however, allow the agency to continue to meet its legal requirements, and to continue current activity which promotes equality. This includes commitments to build the number of account-managed companies led by women, ethnic minorities, young people and disabled people, and improve equal pay occupational segregation profiles for gender, ethnicity and disability. Any additional activity associated with the increase will require equality impact assessment by SE.

There will also be new spend of £10 million to support the activities of the South of Scotland Economic Partnership ( SOSEP), the interim arrangements established in advance of the new statutory South of Scotland Enterprise Agency ( SOSEA). This new agency will help to address challenges in a part of Scotland that had traditionally lagged behind in economic and social terms. Specific challenges include an ageing population, a loss of young people, and local economies dominated by low-skilled, low-paid jobs.

Interim arrangements for the area include a new economic partnership; and its prioritised work programme will set out what the partnership will do to tackle economic disadvantage and barriers to inclusive growth, addressing issues such as low levels of skills and opportunities for young people, older workers and women. The new spend is therefore expected to have positive impact for gender and age. A full equality impact assessment will be undertaken in due course to consider the full range of protected characteristics.

There is also new spend of £18 million planned for the National Manufacturing Institute of Scotland ( NMIS). Through bringing research, industry and the public sector together to transform skills, productivity and innovation, this industry-focused international centre of manufacturing expertise will attract investment and boost the international competitiveness of manufacturing companies in Scotland. The equality impacts of NMIS will be fully considered through the programme’s detailed design and delivery stages. Although still in early stages of development, two areas have been identified which particularly promote equality:

1. The capital investment stage: construction activity, including through the supply chains, will offer employment opportunities for disadvantaged groups, including women, disabled people, ethnic minorities and young people.

2. The operational stage: the training offer, both for upskilling older employees and attracting future manufacturing talent, will play a key role in delivering inclusive growth outcomes, including on improving the gender balance of the manufacturing workforce.

It is intended that NMIS will be accessible to all companies across Scotland and internationally. Outreach activity will ensure the Institute delivers truly national benefits, with existing businesses and inward investors able to draw on the expertise NMIS offers to help them prosper in an increasingly digital industrial age.

Research and development (R&D) activity is crucial to unlocking innovation in Scotland. An additional £15 million will be made available for the large R&D grants scheme and the SMART programme to fund more projects. These grants are open and accessible to all businesses, and are marketed to a wide range of businesses by Scottish Enterprise alongside other SE opportunities. SE ensures that all of their products are delivered in a manner that is consistent with the equality duties outlined in their ‘Equality Mainstreaming Report’ published in April 2017. ^[6]

A £4 million commitment has been made to the Unlocking Ambition Challenge, and £3 million of this will be made available in 2018-19. This will support up to 40 early-stage entrepreneurs to base their business growth in Scotland. Successful individuals will receive wraparound business support and mentoring from high-profile successful entrepreneurs. We will try to achieve a gender balance across mentors in order to help reduce specific barriers for women and address the gender gap in enterprise.

A Focus on Place: City Region Deals

City Region Deals ( CRDs) are central to our delivery of inclusive growth across all parts of Scotland. Their emergence has presented an opportunity for using investment to address the geographic imbalance of growth across Scotland. An additional £65.3 million will be made available for new and continuing CRDs. Resource will provide for agreed deals for Glasgow City Region, Aberdeen City Region, and Inverness and Highland City Region. Heads of Terms have been agreed for Edinburgh and South East Scotland City Region, and discussions are ongoing to secure CRDs for the Tay Cities Region and the Stirling and Clackmannanshire City Region. We are working to deliver a regional deal for the Ayrshires and a Borderlands deal.

The impact on equality groups from CRDs has the potential to be significant, however, impact assessments have only been conducted for Aberdeen and Inverness deals. This is in part due to the fact that data on protected characteristics is limited at regional level. To combat this, efforts are being made to collaborate with local authorities as deals are delivered to ensure maximum impact for equality communities is achieved and inclusive growth delivered. Grant offer letters explicitly state that councils will work with the Equality and Human Rights Commission and others ‘to explore opportunities to maximise the impact of the deal to deliver inclusive growth’. This focus on protected characteristics during the operationalising of CRDs has the potential to address inequalities both within and between regions in Scotland.

Energy

This budget will deliver secure, affordable and clean energy, and contribute to the strategic priority areas of investment, innovation and inclusive growth. The spend on energy is being maintained for the year ahead, reflecting the continued support for a flourishing, competitive energy sector. There is limited anticipated impact for protected groups in this context.

Accountant in Bankruptcy

Accountant in Bankruptcy is responsible for administering and supervising the process of personal bankruptcy and recording corporate insolvencies in Scotland. Most of the costs of the agency are met by statutory fees, including the recovery of operational costs incurred in administering bankruptcy cases.

Given a forecast fall in revenue, increased government support of £2.4 million is necessary to maintain current service standards, but will not impact on equality groups.

Conclusion

An increase in spending on Fair Start Scotland, the NMIS, SE, SOSEP and CRDs should have benefits for people with protected characteristics across all of Scotland, especially women, younger and older people. In areas where spending levels have been maintained or decreased, there is no anticipated equality impact. There is also scope for new policy areas to consider equality implications from the start of the policy cycle, ensuring inequality is reduced and inclusive growth is supported.