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Covid-19 (Economy)

– in the Scottish Parliament on 21st April 2020.

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Photo of Lewis Macdonald Lewis Macdonald Labour

Moran taing a h-uile duine. Many thanks to all concerned, both here and elsewhere, for your good wishes and your kind words.

The next item of business is a statement by Fiona Hyslop on the economy and Covid-19. The cabinet secretary will take questions at the end of her statement, so there should be no interventions or interruptions.

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

The Covid-19 public health crisis has led extremely quickly to an economic crisis that is global in nature but also local, impacting on many people and businesses in Scotland. To combat the spread of the virus, many businesses have already closed and we face an enormous challenge in helping other businesses to survive, to provide jobs and to service the economy.

I thank all businesses and their workers for following the social distancing guidance, the essential sectors and supply chains for continuing to keep the country running and those companies that have repurposed to manufacture supplies for the health sector.

We estimate that up to 70 per cent of the workforce is still working, with many people delivering health, care and welfare services, and many others working from home, often combining that with childcare and home schooling. By staying home, they are playing their part in tackling the virus. They are helping to protect the health service and to save lives.

As Covid-19 continues to have a significant impact across the world, there is major uncertainty in financial markets, supply chains and the functioning of the global economy as many countries, including Scotland, have had to reduce economic activity to stop the spread of the virus. The latest surveys for Scotland show a similar pattern to other countries, with falls in business activity in March that are even sharper than during the financial crisis. The chief economist’s “State of the Economy” report, which was published today, projects that Scotland’s gross domestic product will fall by a third during the period of social distancing.

It is important, however, to put the economic impacts in context. This is no normal downturn and we need to view economic data and projections in that light, recognising that productive and profitable businesses across Scotland have been required to pause activity to support the public health effort.

We have pursued three main aims for the economic response to date: to keep companies in business and with productive capacity so that they can recover; to keep staff in employment with appropriate income protection and support; and, most important, to provide support to staff so that they can self-isolate and care for loved ones.

It is in everyone’s interest to help companies through this turbulent period. The United Kingdom Government has the immediate fiscal and macroeconomic powers to respond to the economic crisis and it has made substantial and welcome commitments to support businesses and employees. However, those commitments do not fully meet the needs of Scottish businesses. There are still significant gaps in both the job retention scheme and the support for the self-employed. Last week, along with the Cabinet Secretary for Finance, I wrote to the chancellor, outlining the changes that need to be made. I am also pressing the UK Government to urgently share data on the implementation of support schemes so that we are better able to tailor our support to businesses.

To address Scotland’s specific needs, we announced additional funding to fill some gaps in the UK Government’s schemes. There is no doubt that we will be dealing with the uncertainty of the impacts and duration of the virus for some time. I engage regularly with businesses, business organisations and the unions and I have been building consensus in recent weeks in support of our four-step economic plan: response, reset, restart and recover.

Initially, we have focused the majority of our efforts on the response stage. Our package of business support is now worth more than £2.2 billion: it is delivering almost £900 million-worth of rates relief and we continue to work with local authorities to progress our £1.3 billion business grants scheme. Support for the fishing industry of up to £22.5 million was announced by the Cabinet Secretary for Rural Economy and Tourism, and the Cabinet Secretary for Transport, Infrastructure and Connectivity has agreed further measures of support for the bus industry of £92 million, for ferry operators of £45.7 million and for rail franchisees of £254 million. We continue to work closely with the UK Government and Oil & Gas UK to assess what more can be done to support the oil and gas sector during its immediate and longer-term challenges.

The Minister for Trade, Investment and Innovation has been working on procuring international and domestic supplies for the health service. On Saturday, 10 million masks arrived at Prestwick airport, and during this week 100,000 litres of sanitiser will arrive at the national health service’s central distribution warehouse. Our enterprise organisations have provided advice and support to over 178,000 companies.

The additional £100 million that we allocated last week will be a vital lifeline for Scottish individuals and businesses to relieve hardship and protect the newly self-employed, who are ineligible for other support, and viable micro, small and medium-sized enterprises that are in distress and might be ineligible for UK Government sources of funding or not yet in receipt of the funds that they need to survive. The grant funding will be channelled through local authorities and enterprise agencies. The scheme will open for applications by the end of April and recipients will receive funds in early May. The provisional allocation will see £34 million for the newly self-employed, £20 million for creative, tourism and hospitality companies that are not in receipt of business rates relief and £45 million for firms that are vulnerable but vital to Scotland’s local and national economic foundations.

The recently self-employed, who are excluded from the UK’s scheme but still suffering hardship, will be able to receive £2,000 grants. For creative, tourism and hospitality companies that have up to 50 employees, there will be easy access to £3,000 hardship grants or larger grants of up to £25,000 where it can be demonstrated that that amount is needed. Support and grants for pivotal SME enterprises will depend on the specific need of each enterprise, and will be developed by the relevant enterprise agency with wraparound support.

I also recognise the challenges that are faced by the cultural sector, which is so reliant on social interaction in theatres, music venues, galleries and festivals. For artists who are facing hardship, I was pleased to announce, yesterday, that an additional £1 million will be given to Creative Scotland’s bridging bursary fund.

Because of our decisions, thousands more businesses, including some that are in vital sectors of the economy, will benefit from support that is not available elsewhere in the UK. However, there will still be gaps, so we continue to engage with businesses on a regular basis to understand their needs and press the UK Government to deliver for them.

The reset phase that we are now entering involves preparation to know what a safe restart will look like sector-by-sector across the economy and what needs to be done to help businesses deliver that. Together with industry sector leads and trade unions, we are developing sector-by-sector guidance to give assurance and confidence as closed businesses—at some point—reopen and restart economic activity. However, that will happen only when scientific and health advice supports it. As an example of the work that is being done, the Minister for Local Government, Housing and Planning and the construction leadership forum have formed a cross-industry group to address the wider issues that are needed to get the industry started again following lockdown. During the coming months, our plan for economic restart and recovery will need to be managed in a safe and orderly way.

Public sector spending on infrastructure accounts for around 50 per cent of all construction activity across Scotland. Therefore, our infrastructure investment will play a vital role in how we reset, restart and recover the economy. So far, only essential construction activity continues in the sectors that are delivering critical national infrastructure—such as primary healthcare, energy, telecommunications, transport and water. Those networks and systems are vital to our ability to keep our country moving and sustain as much economic activity as possible in the current crisis. As we all know, our digital infrastructure has proved to be an essential lifeline for people, businesses and services across Scotland.

The restart might be phased. A slower but more effective restart will reduce the danger of a second wave of the virus, and will avoid a false restart for the economy, which would require further closures. Recovery will not be quick and the post-crisis world will be very different, with different business practices, markets and behaviours.

Last week, I announced the establishment of an advisory group on economic recovery. I am sure that members will agree that independent expert advice is more important than ever. The group will be steered by Benny Higgins and will include Professor Sir Anton Muscatelli. The challenge that I have set for the group is to engage, analyse and listen to those who are affected by the crisis, and to bring forward solutions to enable our economy to recover quicker and better.

Mr Higgins will lead engagement with the business community alongside the enterprise organisations. I am pleased that Lord Smith of Kelvin, who is the chair of Scottish Enterprise, has agreed to be part of the process of gathering the views on the business aspects of the economic response.

We will go wider, with active engagement with trades unions, local government, third sector and environmental representatives, because how the economy recovers is relevant to everyone.

I am setting a demanding timetable: proposals to Government are due by the end of June. The proposals will be taken forward alongside a range of other sources of expert policy advice as we implement the Government’s agenda to build a wellbeing economy and ensure a green recovery. The advisory group will also draw on input from the Council of Economic Advisers.

I can announce further members of the advisory group: Dame Sue Bruce, Professor Anna Vignoles, Professor Dieter Helm, Grahame Smith and Professor John Kay.

The Scottish Government recognises the significant impact that the response to Covid-19 is having on Scotland’s economy, businesses and people. We are doing everything that we can to mitigate that impact, respond to the crisis and reset as much economic activity as we can. At the same time, we are planning ahead to restart the economy and, in due course, to support economic recovery.

The Deputy Presiding Officer:

The cabinet secretary will now take questions on the issues that were raised in her statement. I intend to allow around 20 minutes for questions before we move on to the next item of business. I call Donald Cameron.

Photo of Donald Cameron Donald Cameron Conservative

I believe that Maurice Golden will be asking this question, Presiding Officer.

The Deputy Presiding Officer:

That is the first substitution of the afternoon. I call Maurice Golden.

Photo of Maurice Golden Maurice Golden Conservative

I thank the cabinet secretary for providing advance sight of her statement.

We all recognise that this is an incredibly challenging time for the economy. However, now is the time to plan how we rebuild it for the long term. I welcome the fact that planning has begun and I look forward to seeing the details thereof.

Of course, businesses must be able to survive to get to that stage. Despite last week’s partial U-turn, it is disappointing that business support in Scotland still falls short of that in England. For example, a Scottish retail, leisure or hospitality business requires a rateable value of £18,000 to qualify for a £25,000 grant, versus a figure of just £15,000 in England. Also, Scottish businesses do not receive a full grant for each additional property, as English firms do. A snapshot of four Scottish businesses that contacted me shows that they are disadvantaged by more than £300,000—the figure across Scotland must be in the millions. Will the cabinet secretary rectify that disparity?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

In good faith, we are working hard to ensure that we complement and supplement the UK scheme and that we fill the existing gaps between the Scottish scheme and the UK one to reflect Scotland’s economy. That is why we have more support for fishing, agriculture and SMEs while ensuring that our strong business base can be supported in the ways that I have outlined.

Our small business bonus scheme is far more generous than that in the rest of the UK, and has been for some time, which means that people and businesses with a rateable value of up to £18,000 can benefit. Companies in England with a value of between £15,000 and £18,000 do not currently benefit from the UK scheme. I say in good spirit that many companies will now be able to receive multiple properties grants of not just £25,000 but—distinctly in Scotland—£10,000 for smaller businesses. The latter is not available in England.

Finally, an example was brought to my attention of a firm that will receive £425,000 with the current Scottish Government scheme, before it gets 80 per cent of wages covered through the job retention scheme. Some companies are getting nothing just now. Please bear with us as we reflect the needs of Scotland and ensure that we are responsive to the economy in every single part of the country as we do so.

Photo of Richard Leonard Richard Leonard Labour

I congratulate you, Presiding Officer, on your elevation.

I thank the cabinet secretary for providing advance sight of her statement, which confirmed what was in the Government’s press release this morning. In that, the cabinet secretary explained that, in the face of skyrocketing unemployment and a 33 per cent collapse in Scotland’s economic output, the Scottish Government’s response to the economic recovery phase is to set up yet another independent advisory group.

The cabinet secretary already has an Infrastructure Commission for Scotland, a Poverty and Inequality Commission, a just transition commission, a climate change plan working group, a Strategic Board for Enterprise and Skills, a Fair Work Convention and a Council of Economic Advisers, so does she accept the scepticism of the Fraser of Allander institute and others who say that we do not need yet another Government advisory committee made up of advisers who are already on existing advisory committees and that instead we need a plan for action and jobs along with the resources to back it up? Will the cabinet secretary make it her business to deliver that?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

This morning, the chief economist set out and laid bare the major impact that Covid-19 is having on Scotland’s economy and on the wider economy, which is an immediate reduction of 30 per cent in gross domestic product. That did not happen as a result of the financial crisis or as a result of any other significant crisis that we have faced. Indeed, international experts recognise that this will be the biggest decline since the great depression.

Does that need action? Absolutely. However, it will also need short, sharp, effective co-ordination to bring together the recovery plan that I have demanded to see before the end of June and to ensure that we can mobilise all of Scotland. This is the time to mobilise. Now that we have mobilised all of Scotland in a public health response, it is time to mobilise all of Scotland in relation to our economic response as well. That is needed to ensure that we mobilise all the aspects that are already working in different areas.

This crisis is unlike anything else and needs a response that is unlike anything else. That is why the four-step plan that I have created, which has been accepted and understood right across the business sector and which I have discussed with the trade unions, is the right way forward. It is about saving jobs and ensuring that, when we save lives, we also protect livelihoods.

Photo of Andy Wightman Andy Wightman Green

I thank the cabinet secretary for providing advance sight of her statement and for this morning’s welcome report from the chief economist. In her statement, the cabinet secretary said that she was

“pressing the UK Government to urgently share data on implementation of support schemes”.

Given that request, will she confirm that Scottish ministers will be equally transparent and will publish on a regular basis the allocation of Covid-19 business support funding, as well as publishing it in an open data format, as requested by the Economy, Energy and Fair Work Committee in its letter to her last week?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

It is important to share what data we can. Today, we have shared information in relation to the business support that has already been provided. That has been approved over the past week, since we had the first information. I am happy to ensure that it is circulated to members as soon as possible.

It is important to understand the detail. For example, we need to know what percentage of companies are accessing the coronavirus business interruption loan scheme in Scotland. In relation to saving jobs, we also need to know about those companies with a turnover of more than £45 million, of which there are a significant number in Scotland that are of strategic importance to our country. Previously, the CBIL scheme would not allow such companies to access funding. In our regular discussions with UK ministers, my colleagues in Wales and I encouraged them to open up a scheme for companies with a turnover of £45 million plus and to ensure that borrowing is sufficient to help those companies to survive.

I agree that the transparent allocation of funding, the progress of such funding and the reporting of that is important. I will look closely at the request in the committee’s letter and I expect to be able to respond positively to it.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

I congratulate you, Presiding Officer, on your new role.

I have a letter from the trade union Prospect, which represents 900 freelancers in Scotland’s television and film industry. Those freelancers were encouraged by Government to move from self-employment and to become employees, paying their taxes through pay as you earn. However, they all had multiple employers and are therefore specifically excluded from furloughing. They have lost all their income. HM Revenue and Customs has all their tax records, as it does for self-employed people, but the freelancers have been left out of the aid package for the self-employed, which uses tax records.

Unlike some members, I welcome the Scottish Government’s stepping into some of the gaps to help freelancers, in particular through the one-off bridging bursary, for which I think that the cabinet secretary is responsible. However, Prospect’s national secretary asks in his letter what else can be done for freelancers in Scotland’s creative sector. Some of them might have got the one-off payment, which is welcome, but that is not what is being offered to others.

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

I absolutely agree with the member. That issue is one of our key concerns about the UK scheme for the self-employed. We continue to press the UK Government on the matter, because freelancers are an important part of the creative industries sector, which, prior to Covid-19, was one of the fastest growing sectors not just in Scotland but throughout the UK.

In the meantime, there are two schemes to help freelancers in the creative sector. The member referred to the Creative Scotland bridging bursary, funding for which has been increased by £2 million. The bursary has been welcomed by the people who are in receipt of it, and represents a move that took place quickly and simply to address an issue. There is also a scheme that Screen Scotland is deploying for broadcasters.

Mr Rumbles has raised an area in which there might be strategic companies that need help. He might look at the £20 million fund for companies that are not in receipt of non-domestic rates relief, which I mentioned, given that a number of the people to whom he referred might be in that category.

Photo of Annabelle Ewing Annabelle Ewing Scottish National Party

Congratulations, Presiding Officer, on your appointment.

It is clear that local authority officials have been working tirelessly to process grant applications, and I am conscious that a significant volume of applications are being submitted. Will the cabinet secretary engage further with local authorities to ensure that they take every possible step to enable applications to be processed as quickly as possible, thereby ensuring that small businesses in my Cowdenbeath constituency and throughout the country can receive lifeline Scottish Government grants into their bank accounts as soon as possible?

The Deputy Presiding Officer:

The

Cabinet Secretary for Economy, Fair Work and Culture has indicated that the Cabinet Secretary for Finance will answer that question.

Photo of Kate Forbes Kate Forbes Scottish National Party

I agree with Annabelle Ewing that local authorities are working tirelessly just now to distribute business grants. As at 14 April, Scottish local authorities had approved more than 18,000 grants, at a value of £215 million, and the number is increasing daily.

I recognise that the grants are a lifeline. We have built into the guidance that we share with local authorities an element of discretion, and we continue to work closely with local authorities to monitor progress on the scheme and to identify where we can offer additional assistance.

On the process, I say first that local authorities regularly identify issues, which they and Scottish Government officials then consider more carefully in order to determine the right answers for businesses. Secondly, I expect every local authority to have a review or appeals process for situations in which the outcome has not been in favour of the business that applied.

We will keep monitoring the issues to ensure that as many businesses as possible get the support that they need.

Photo of Donald Cameron Donald Cameron Conservative

In her statement, the cabinet secretary mentioned the construction sector—an area in which the current guidance in Scotland on staying open differs from the approach in the rest of the UK. When the time comes, will the cabinet secretary consider restarting the sector as quickly—and as safely—as possible, given its importance to the national economy and to local economies throughout Scotland, especially in rural areas such as in the Highlands and Islands, where construction projects tend to be smaller and where it is, arguably, easier to implement social distancing and other health protection measures?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

Donald Cameron has made an important point. Construction is an important sector, which is why activity in Scotland on developing guidance is moving at pace.

I refer to the work of my colleague Kevin Stewart, the Minister for Local Government, Housing and Planning, who is co-chairing the construction forum, which is working with subgroups to identify all the areas that need to be worked on to give people confidence about return to work.

As we have seen from other parts of the world, construction might be a sector that can move before others. However, I am not saying what its phased recovery and restart would look like or, indeed, in what order or on what dates that would take place. However, Donald Cameron has raised a very important point, which is why that work is continuing at pace. For the reset period, guidance has been produced with businesses and trade unions in every sector. Guidance is well developed in relation to construction work.

Photo of Kenneth Gibson Kenneth Gibson Scottish National Party

I am sure that the cabinet secretary will agree that newspapers are vital to maintaining community cohesion and morale at this time, by reflecting their readers’ activities while recognising their achievements and keeping them informed.

However, the survival of some newspapers is in doubt, because many readers cannot get out to buy print copies and advertising revenue plummets. Much of the assistance that is required to support newspapers is reserved to the UK Government. What will the Scottish Government do to assist local, regional and Scottish newspapers? For example, will ministers consider 100 per cent rates relief for news publishers for the current financial year?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

I will consider the request that Kenneth Gibson has made. We are already in active dialogue with the newspaper industry. The situation is that it is vital that people understand what is going on in relation to the Covid-19 crisis.

However, although some have done so, newspapers are not necessarily in a position to furlough staff, because they want to stay active. In addition, some newspapers were vulnerable prior to Covid-19. We will therefore have to look at all such areas in respect of consideration of support for the newspaper industry. I thank Kenneth Gibson for raising the issue; we are in active discussions, and every suggestion and idea in relation to support will be considered. He mentioned that a number of issues are reserved to the UK Government: I commit to raising them as part of the quadrilateral meeting that I take part in with the Welsh and Northern Irish Governments and the relevant UK minister.

Photo of Colin Smyth Colin Smyth Labour

I welcome the new Deputy Presiding Officer to his role.

While the vast majority of businesses have acted responsibly and have stayed closed unless they carry out essential work, not all have done so, including Prestwick Aircraft Maintenance, whose landlord is the Scottish Government.

Not only did that company refuse to furlough its workforce, which would have allowed it to continue to pay at least 80 per cent of wages, but it is trying to impose a 50 per cent pay cut on its workers and is sacking those who refuse to agree to that.

Does the cabinet secretary understand that the company gets away with that because the Government guidance on what is essential business is not backed up in law? In the absence of a legal underpinning for closing such businesses, what is the cabinet secretary doing to fully enforce her own guidance, not least on companies such as Prestwick Airport that are based on Government-owned land?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

Colin Smyth will be aware that Prestwick Airport operates commercially, at arm’s length and independent of the Scottish Government. I have personally expressed my concern about the actions and activities that are taking place in the company. Although I know that Scottish Enterprise has brought the guidance to the company’s attention, I am not sure whether it is necessarily appropriate for that to be its role, which leads me to the point about what we might have to do going forward.

Clearly, even on return to some commercial activity, social distancing will be maintained. Therefore, how we improve enforcement will be very important as part of our rebuilding of our capacity and infrastructure, and to organisations that are not precluded by law from operating. Parliament agreed what companies should close by law, but we also appealed to other companies that are not part of essential sectors to close. However, as Colin Smyth is undoubtedly aware, the argument that is being made by Prestwick Airport is that it is part of an essential sector, which is where the dispute currently lies.

Photo of Gillian Martin Gillian Martin Scottish National Party

I welcome you to your new role, Presiding Officer.

What is being done to help workers who have been made redundant, whether officially or notionally, by companies that have refused to apply for furlough for them during the crisis? That seems to be a pattern particularly in the north-east, where the low oil price is compounding the situation. I am also hearing from many younger part-time workers who have lost income due to companies closing, which has excluded them from furlough applications.

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

Gillian Martin has raised a very serious situation. We have encouraged companies to furlough rather than to make people redundant. There was some scepticism and concern about how effective the job retention scheme would be before it was in action. As of yesterday, job retention funding for wages has been coming through, and now that employers can see that, it might make them pause and think again about making people redundant.

I think that a number of companies do not want to get into debt for a variety of reasons, and are not accessing the coronavirus business interruption loan

scheme.

The point about support is very relevant to our responsibilities. As Gillian Martin will be aware, the partnership action for continuing employment—PACE—scheme is making adaptations to ensure that, despite the restrictions on face-to-face contact, it can still deliver the marketing campaign to promote its service to individuals, such as those whom Gillian Martin referred to, who might need support. There is also a helpline and other funding support in order to ensure that those who are facing redundancy get the support that they need.

Companies do not necessarily have to make people redundant at this time. Furloughing is possible, so I encourage companies to think again if they have made, or are making, decisions to make their staff redundant rather than entering the furlough system.

Photo of Michelle Ballantyne Michelle Ballantyne Conservative

Congratulations on your appointment, Presiding Officer

The cabinet secretary will be aware that many companies, particularly some of our SMEs, will struggle if the inability to go back to work extends beyond May and into June. The grants that they get are extremely welcome, but they will not subsidise them going forward over months. Can the cabinet secretary offer SMEs reassurance that they will be able to open during the summer?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

It is not for me to decide on what date we move forward. That is something that we will need to understand collectively, based on scientific and health advice.

It is not just about grants; there are other things that small businesses can rely on, such as deferring capital debt, which a good number of companies have done, rather than use the CBIL scheme. There are other ways to try to reduce fixed costs. I note and welcome the extension of the job retention scheme into June, which will assist with wages.

We do not know what the future will hold in terms of timing and phasing of restart and recovery. The most important thing now is to think about how we can do that safely. It is incumbent on every business to do that, so I encourage SMEs and other businesses to plan ahead.

Photo of John Mason John Mason Scottish National Party

I think that there has been some mischief making by Opposition members about the business support scheme. Will the cabinet secretary say whether the Scottish Government is providing more or less than the Barnett consequentials?

Photo of Kate Forbes Kate Forbes Scottish National Party

I can answer unequivocally that we are providing more than Barnett consequentials to support business and ensure that our support is tailored to the particular challenges that are being faced in the Scottish economy. Last week’s announcement of a further £220 million-worth of measures to help companies that are affected by the pandemic has seen our support now start to fill the gaps—gaps in previously announced schemes as well as the UK Government scheme. I am unaware, for example, of any other scheme in the UK that supports the newly self-employed. I am also unaware of other schemes that will see multiple properties funded in the £10,000 grant scheme.

That additional support ensures that businesses that are struggling with the business impact of the coronavirus pandemic will be able to survive the next few weeks.

Photo of Jackie Baillie Jackie Baillie Labour

Paul Sheerin, the chief executive of Scottish Engineering, highlighted in

The Herald the confusion between the law and guidance. In essence, there is a divergence between the legal position in Scotland for businesses that can continue to operate, provided that they take safety precautions, and the Scottish Government guidance, which is stronger and suggests closure. Although I understand that public health is the priority, there is genuine concern as manufacturing capacity is lost. Will the cabinet secretary confirm that the guidance does not supersede the law?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

The law is the law but, as the member will appreciate, we are moving at a very fast pace. Guidance is required and it has been requested, and the improved guidance on social distancing for businesses has been welcomed by both the business sector and trade unions.

Photo of David Torrance David Torrance Scottish National Party

Presiding Officer, I, too, offer my congratulations on your new role.

Concern has been raised that many people who started jobs in March will not be eligible for the UK Government’s job retention scheme, because they will not have been on their employers’ payrolls until the end of the month. That will have a significant impact on seasonal and temporary workers, many of whom are being left out of wage support measures altogether. What engagement has the Scottish Government had with the UK Government about closing the gap on the support scheme?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

Just last week, I personally raised that precise issue with the chancellor in one of the regular calls that the Scottish Government has with the UK Government.

I welcome the extension of the cut-off date to 19 March. I encourage the UK Government to think further about the scheme, and particularly about the needs of businesses in Scotland, where we have so many seasonal workers who usually go on to employers’ books on 1 April in any year. In our call, the chancellor explained that the UK Government did not want to encourage companies that employed people after the announcement of the date for the job retention scheme to take advantage of it. However, given the nature of such seasonal work, and the fact that the extension to 1 April offers quite limited scope for exploitation but captures a large number of our seasonal workers, I will continue to offer such encouragement, because I think that such an approach still has merit.

Photo of Rhoda Grant Rhoda Grant Labour

Presiding Officer, I, too, welcome you to your new post.

Businesses tell me that they are struggling due to the length of time that is taking to get the promised support to them. The Fraser of Allander institute’s Scottish business monitor survey tells us that 54 per cent of businesses said that they could not survive for longer than three months under the current conditions. Will the Scottish Government examine how it might get payments to businesses much more quickly—and certainly within this month? Will it also investigate whether the funding for the Scottish national investment bank could be used to support such businesses?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

Speed is of the essence. The current situation has presented a cash-flow issue for many companies, so getting grants out to them quickly has been imperative. In the grants scheme that we have established, most councils started paying out from 6 April to ensure that they were operating in the current tax year, which will have been of greater benefit to companies. However, that was also done to ensure that the speed of payment was such that they could be responsive.

From the Scottish Government’s point of view, the speed of getting grants out is imperative—and we have heard that from members, too. The new schemes that I have just announced will also work at speed. Applications should be made at the end of April for payment in May.

The fact that the job retention scheme is paying out this week should be of some assistance to the companies to which Ms Grant referred, which will have made those remarks before they started to receive payments through that scheme. The scheme went live on Monday of this week and, within six working days, is expected to meet the end of April target.

However, there are still real problems, which is why we need to see the data on the loans scheme, which we think does not fully meet the needs of Scottish businesses. We hear that it is important for small businesses to achieve those grants, but the loans scheme should have worked with them as a bridging mechanism to the grants and the job retention scheme. For too many companies, that is not happening. That is why—particularly for key, anchor and pivotal enterprises across Scotland—we are trying to supplement what we are doing, to ensure that they can survive. Otherwise, as Ms Grant said, many will not. Although the current crisis is absolutely a public health one, we are also now having to tackle an economic crisis.

Photo of Patrick Harvie Patrick Harvie Green

Welcome to the big chair, Presiding Officer.

Will the cabinet secretary join me in congratulating the Government of Denmark on establishing the principle that firms that are based in tax havens will not be eligible for publicly funded bail-outs? Would she like to apply the same principle here, to whatever extent that might be within the power of the Scottish Government?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

That principle is an important one.

We will certainly reflect on whether it could be applied in any way in Scotland, although I am not convinced that we would necessarily have the powers to do so.

However, I add a note of caution on one point, which is important. The majority of such funding will come through the UK Government’s job retention scheme, over which we have no power—although, as I have said, we will try to use our influence to make it better. It is important to note that, because the issue is one of wage support going to individuals. It is imperative that any company that receives funding from the job retention scheme passes it on and that it goes towards supporting the wages of workers in those companies. I would not want to see anything that deprived workers of wages and support, but the principle of what has been done in Denmark is definitely worthy of investigation.

The Deputy Presiding Officer:

Thank you. That concludes questions on the statement on the economy. My apologies to Neil Findlay and Claire Baker, as we now simply need to move on to the next item of business.