Executive Must Act To Boost Scottish Financial Services

21 May 2004

EXECUTIVE MUST ACT TO BOOST SCOTTISH FINANCIAL SERVICES

The First Minister must take charge of the enterprise brief to develop policy on the economy and financial services, says a new report by the Policy Institute, a Scottish think tank.

Only he has the clout to co-ordinate policy across the departments – and get Scottish representatives at Westminster and Europe to stand up for Scottish industry.

The paper, by Ross Leckie, says that Scotland’s finance industry has been the fastest growing part of the economy in the last five years. It now employs 106,000 people and contributes Ł7bn to Scottish GDP.

But new competitive pressures from overseas, combined with heavy domestic regulation, has threatened the success of the sector. “The context is alarming, and the need is for action is now”, says Leckie.

As well as an enhanced role for the First Minister, the paper suggests an income tax cut to attract highly skilled but highly mobile financial sector workers.

It also recommends fast-track development rules to allow new office space in the Central Belt, and for private companies to develop high-speed rail and road links between Edinburgh and Glasgow.

In addition, Leckie suggests that Scottish Financial Enterprise play a bigger role in promoting the sector overseas, and educating policy makers at home. It should also investigate ways of changing Scots Law to allow new financial products and corporate structures.