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SNP faces 'anti-business jibe'

Scotland suffers loss of 8,800 companies in a year

Murdo Fraser

Murdo Fraser: ‘SNP policies are hostile to business’ (pic:Terry Murden)


The Scottish government’s record on business support has come under scrutiny after new figures show thousands of firms have been wound up over the past year in Scotland.

Official data reveals there were 8,830 fewer businesses, a drop of 2.5%, operating in Scotland in March 2018 compared to a year earlier.

The Conservatives said the figures were evidence of the SNP’s “anti-business attitude” while the Liberal Democrats attacked both the SNP in Holyrood and the Conservatives in Westminster because of their Brexit policy.

The statistics show there are now 345,915 private sector businesses north of the border. That compares to 354,745 the year before, a drop of 8,830. 

The number of unregistered firms – which have a turnover below the VAT threshold of £85,000 a year – fell by almost 5%, with 8,720 fewer businesses operating in 2018.

However, the number of businesses that are registered for both VAT and PAYE also decreased in the last 12 months, dropping by 105 to stand at 176,295.

That marked the first reduction in the number of private registered businesses since 2011, Scottish Government figures showed.

The rate of private businesses per head of population is also worse in Scotland than the rest of the UK. 

Total business turnover is at its lowest level since 2015, while only a handful of local authority areas have seen an increase in business activity.

FSB Scotland policy chair Andrew MacRae warned: “A decline in the number of Scottish businesses spells trouble for our ambitions for our economy and our local communities.”

He added: “To tackle this problem, we need to see more people in Scotland choose to start up in business and develop a business environment which helps local firms thrive.

“In the short term, we need to see a Brexit deal which works for smaller firms, not just key sectoral interests, and a Scottish budget which puts enterprise at its heart.

“In the long term, we need a stronger start-up culture, as well as tax and regulatory systems which recognise the difference between multinationals and family firms.”

Shadow finance secretary Murdo Fraser said a range of SNP policies were contributing to a more hostile environment, not least Scotland becoming the highest-taxed part of the UK.

He added that, after more than 11 years in government, the nationalists should have done more to encourage entrepreneurship. 

“Over the years we’ve heard plenty of warm words from the SNP about encouraging entrepreneurship and supporting those who set up their own businesses. But those words have come to nothing, and these figures today show the situation is now going backwards.

This is all the consequence of an SNP government with an anti-business attitude.

“Instead of helping people who want to take risks and go it alone with their business, the nationalists focus on hiking tax and punishing hard work. It’s no wonder the number of private business has fallen as a result.”

Scottish Liberal Democrat leader Willie Rennie commented: “We know Scottish growth has been marginal and this is being reflected in the falling numbers of businesses operating here.

“Businesses can only grow and flourish if they can find the right talent. The Scottish Government needs to build a high-skill high-wage economy by investing in people, transforming our education and skills system and making a stepchange in mental health.

“The Conservatives’ undue reputation for business savvy is also in tatters. That’s why we need an exit from Brexit because it makes no sense to put more barriers in the way of business.”

Scottish Labour’s Finance spokesperson James Kelly said: “The SNP is presiding over an exodus of small businesses from Scotland.

“As the Federation of Small Business points out, this sharp decline spells bad news for our economy and local communities.

“Meanwhile, firms are also crying out for certainty amid the Tory government’s calamitous handling of Brexit.”

Retail jobs down

The Scottish Government’s ‘Businesses in Scotland 2018’ report reveals that the total number of jobs in the retail industry has fallen by 3,820 over the past eight years, down to 248,360.

Retail industry turnover in Scotland has meanwhile risen from £28 billion to £31.5 billion over the period.

Commenting on the data, David Lonsdale, director of the Scottish Retail Consortium, said: “These figures should serve as a wake-up call to policy makers to properly focus on reducing the costs of doing business.”

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