Business Confidence and Promotion of Entrepreneurship

Part of the debate – in the Scottish Parliament at on 7 February 2024.

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Photo of Richard Lochhead Richard Lochhead Scottish National Party

I thank Fergus Ewing for highlighting the challenges that many hospitality businesses in Scotland face at the moment. It is a mixed picture. I have spoken to many hospitality businesses that are expanding and are investing significant amounts of resource for the future. I have just returned from a tourism summit in Islay, where I spoke to many local businesses. There are many challenges on Islay, and throughout the whole country, in the hospitality sector. However, under Scottish Government policy, we estimate that 63 per cent of hospitality businesses will not pay any rates whatsoever. Of course, as part of the current arrangements, the budget extends to relief for island hospitality businesses, to help to address the particular challenges that many of our islands are facing.

We continue to look at all those issues, but we face a very difficult budget settlement from the UK Government, so we cannot achieve everything that we would like to achieve in the draft budget. Many of the factors that the hospitality sector has expressed to me relate to increased raw material costs due to inflation, increased interest rates and increased energy bills, so the source of the problem is very much at the UK level. We continue to bring those matters to the UK Government’s attention, as well.