New Deal for Business Group: final progress report

Conclusions and Next Steps

The New Deal for Business Group was created in 2023 to ‘reset the relationship with business” after some challenging years for Scotland’s economy. But understanding and managing the impact on business of policy decisions is not time limited. It will always be critical.

A strong government and business relationship will create a mutually beneficial environment that supports a growing economy and improves business confidence, allowing greater levels of private investment. In turn this will support sustainable finances to tackle poverty and support our public services and communities.

Significant improvements in process and understanding across government, and the culture change we need to ensure relations between government and business are mutually beneficial are well underway. The recent Understanding Business quarterly survey of 600 businesses, compiled by 56 degrees North and the Diffley Partnership^[12], has found 48% of businesses now say they believed the Scottish Government understand their concerns, which is an improvement and has been sustained over 3 waves of the survey. However, as should be clear, we know that more needs to be done. We are committed to building on the substantial progress achieved by the New Deal programme within a very tight timescale, over the longer term.

The importance attached by the Deputy First Minister, and her Ministerial colleagues to hearing from and speaking directly to businesses on the key overarching challenges we face as a country remains. We will be taking a strategic approach to engagement, looking to better align, build on and evolve as necessary existing channels of engagement to really focus on quality and substance of engagement.

The recently established Cabinet Sub-Committee on Investment and the Economy, also provides an excellent opportunity for a more strategic approach in identifying prospective policies, legislation and regulation which may have impacts – including cumulative - on Scotland’s businesses.

The ongoing work of the Regulatory Review Group to consider policies, legislation, and regulation in development across the Scottish Government, will dovetail with the work of CSC-IE, to ensure that potential business impacts are identified, considered, and presented to Ministers enabling fully informed decisions.

Across the world increasing attention is being paid to the role of Regulatory Reform as a driver for economic growth. Although some New Deal for Business recommendations related to the existing regulatory framework, a conscious decision was taken during the initial programme period to prioritise work on prospective policies and regulation, rather than on those that are already in place. Moving forward we will now look at Regulatory Reform in the round, working with our counterparts in the UK Government to understand their approach, and ensure that Scotland’s interests and devolved competencies are fully respected and heard. We also want to work with sectors to explore where regulatory simplification might be possible, whilst ensuring the public good intention of regulation is not undermined.

The work of the last 24 months, including establishing the Cabinet Sub-Committee on Investment and the Economy and the reestablished RRG, will ensure that engagement with business and consideration of potential impacts is of a consistently high standard. Policy teams across the SG will have guidance, training, support, and best practice examples, to ensure business impacts of policy making are understood, and subject to ongoing scrutiny. Our work here is not over, it’s only just begun.

“Throughout my time as a member of the New Deal for Business Group I have been inspired by the heartfelt desire of all involved to improve business-government relations, and I am thankful for the support of the officials who have helped the Group in navigating through to a position of delivering this final report. This report captures the concrete actions generated by our work, which is of course imperative.

Speaking personally, to me the Group has delivered more, perhaps less tangible, but equally important and positive outcomes. I have been struck by the real desire on the part of Government to commit to engagement with the business community, and vice-versa, and I believe that this cultural shift should not be overlooked when considering what the Group has achieved. This is an element of the Group’s work I would hope to see ongoing commitment to, as to me it is a critical aspect of the Group’s legacy.”

Iain Baxter, Chief Executive, Scotland Food and Drink