FSB’s McRae: “Blueprint must loosen vice on economy”

The Scottish Parliament will this afternoon scrutinise the Scottish Government’s proposed strategic framework for managing the coronavirus crisis. Ahead of the debate, the Federation of Small Businesses (FSB) in Scotland has outlined five areas where Ministers should deliver improvements.

Andrew McRae, FSB’s Scotland policy chair, said: “The virus, and our governments’ response to it, has our economy in a vice. It is our hope that this new strategy from Ministers is the key to seeing more of our members being allowed to open their doors and get trading.

“It cannot become a blueprint for shut-downs. That’s why we’ve outlined five priority areas where policymakers need to focus their efforts to ensure we do the minimum amount of damage to local businesses, communities and job markets in our efforts to get on top of this crisis.”

Proposals from FSB suggest that Ministers should:

  1. Improve grant support – Ministers should extend the application date for the current round of funding; look to promote the support to groups who may be underutilising the help (e.g. minority ethnic entrepreneurs); investigate whether the help is on offer is sufficient; look to ensure that grant help is open to more businesses indirectly impacted by current and future restrictions; and improve the administration of the grant system.
  2. Resist travel bans – Legally enforced local authority travel bans would cause significant problems for many operators by, for example, making it difficult for firms to take supplies. Such moves would also make have a knock-on impact on tourism across Scotland. Ministers should not implement travel bans unless unavoidable.
  3. Move away from blanket sectoral restrictions – FSB would like Ministers to explore whether at least some businesses currently closed – e.g. softplays and hospitality firms – could open if they pass some variety of quality-assurance scheme. This move could see more operators open their doors if they’ve taken appropriate precautions.
  4. Clarify business guidance – Much current official guidance does not recognise the diversity in Scotland’s business community. Ministers and officials should systematically update current information for business to ensure that it provides clear, practical advice for firms. Specifically, FSB would like the Scottish Government to provide clear information for tradespeople and other businesses that conduct work inside people’s home.
  5. Introduce an early warning system for firms – Businesses and communities in areas that are moving between tiers should be alerted as soon as possible to allow them prepare. Local forums should be established in every local authority to mitigate the impact on businesses and citizens.

During the lockdown in spring of this year about half of FSB’s members in Scotland had to close their business temporarily. At that time, about a third of those that had to shut their doors feared they wouldn’t be able to re-open.

Andrew McRae said: “Up and down Scotland, businesses have exhausted their cash reserves funding their operations throughout this exceptionally difficult year. That’s why firms fear new measures, because most of them don’t have the money in the bank to see them through.

“Imposing tight restrictions on an area will now likely result in business failures. That’s why MSPs must scrutinise the decisions of the Scottish Government, and bring understanding of the impact on the wider economy to the Scottish parliamentary chamber.”