2. To ask the Scottish Government whether it will provide an update on future funding for South of Scotland Enterprise. (S6O-02959)

South of Scotland Enterprise has made a significant impact since its launch in 2020. Last year, the agency provided tailored advice and support to more than 1,100 enterprises. It invested £10.5 million into businesses and communities and a further £5.4 million into strategic projects.

We have prioritised funding for SOSE to the extent that is possible, given the extremely challenging funding settlement. The 2024-25 budget allocates almost £27.4 million to the agency to support economic and community development across the region. SOSE is committed to boosting investment, accelerating opportunities and helping businesses and communities to grow and achieve their potential. We will keep working with it to support those shared ambitions.

South of Scotland Enterprise was launched four years ago. Since it started, its funding has been cut year on year. This year, it was cut to £34.5 million, which was down nearly £3 million. Next year, as the Cabinet secretary has said, its funding will be slashed to £24.7 million. The promise—which is in the financial memorandum that I am holding— has been broken of a fair share per capita of population equivalent to the funding of Highlands and Islands Enterprise. Businesses have been betrayed.

Will SOSE be expected to cut its operating and labour costs to ensure that it can deliver its five-year action plan on that budget?

The funding that was provided in the autumn statement fell well short of what we need. Scotland needed more money for infrastructure, public services and pay deals; instead, the autumn statement delivered a real-terms reduction in the block grant. [

Interruption

.] It is a bit rich for Conservatives who are pro-austerity to complain about its impact.

You are breaking your financial memorandum promise.

The Presiding Officer:

Throughout this session, since it began, I have heard almost constant commentary as members have put or responded to questions. I ask all members to cease that.

As I said, it is a bit rich for Conservatives who are pro-austerity—a decade and a half of austerity—to come here and complain about the impact that austerity has on services.

In that context, we have prioritised funding for the enterprise agencies to the extent that we possibly can. The budget allocates more than £307 million to enterprise agencies. If the Conservatives wish to see a change, they are more than welcome to suggest cuts for elsewhere in the budget—or, even better, to persuade their colleagues at Westminster to stop the cuts at source.

Will the Cabinet secretary provide further detail on how Scottish Enterprise’s blueprint for economic growth, which was launched on Monday, will help to deliver a more successful, fairer and greener economy?

I was pleased to be at the launch of Scottish Enterprise’s new strategic focus, which has three key missions at its heart. It is about ensuring that we support the energy just transition, that we have innovation at the heart of our economy and that we attract capital investment that improves productivity. We will keep working with Scottish Enterprise, SOSE and Highlands and Islands Enterprise to ensure that those key areas of investment are supported.

The budget cut to South of Scotland Enterprise represents some 20 per cent. That is coupled with a 12.8 per cent cut to Highlands and Islands Enterprise and a 15.2 per cent cut to Scottish Enterprise. What assessment has been made of the impact that that will have on headcount and, critically, the number of businesses that, collectively, those agencies will be able to support?

We continue to work with all our agency partners to ensure that the budget that they have available, which we have been able to prioritise, goes as far as possible towards ensuring that the service that they provide is well tailored to the areas that they serve and the sectors that we must continue to support.

If Labour has a proposition to change the allocation that goes to enterprise agencies, the Deputy First Minister and I would, of course, welcome that. However, to have any credibility, Labour will need to suggest what areas need to be cut back from elsewhere in the budget.