Getting ‘economically inactive’ people off NHS waiting lists could help 40,000 Scots get back into the workforce, the Scottish Secretary claims today.

Ian Murray says almost 300,000 people in Scotland are not in work or looking for work because they are long term or temporary sick.

The economic inactivity rate at 23.4% is higher than the UK wide rate of 21.6 %, meaning 133,200 people in Scotland want a job but are not looking.

Scotland matching the UK rate could mean over 40,000 Scots back into work and generate millions more for the economy, says Mr Murray.

He says Scotland’s higher rate is “almost entirely” down to higher rates of people not seeking work because they are short term or long-term sick, which is 5% higher than the UK average.

“As it stands, NHS waiting times are one of the biggest blocks on growing our economy,” he says in a speech today.

Mr Murray says Scotland’s two governments can work together to deliver the economic growth to unlock jobs and opportunities for people in Scotland.

However, his claim that Labour introduced an “austerity-ending budget for public services” will be challenged by opponents, given expectations that the UK government will announce billions of pounds of cuts later this month.

Employment experts say economic inactivity is partly a result of a lack of flexible options from employers that suits the needs of parents, carers and others who want part-time or home-based work which is not available to them.

CBI’s Soames says employment reforms will be ‘damaging’

The UK government’s employment reforms must change to avoid damaging companies’ willingness to invest and hire, said the president of the CBI.

Former Aggreko and Serco CEO Rupert Soames, said that despite government amendments this week, the Employment Rights Bill would deter both domestic and foreign businesses from employing more people in the UK.

He said the views of the CBI, one of Britain’s big five business lobby groups, had been “largely ignored” and that the government’s own estimates suggested the reforms will add £5 billion to companies’ costs.

On Tuesday the government tabled amendments to the bill following consultation with business groups and unions, including changes to statutory sick pay and applying zero hours contracts measures to agency workers.

Angela Rayner, the deputy prime minister who is steering the bill through parliament, insisted that strengthening workers’ rights will contribute to higher growth.

A number of trade groups and think tanks, including the Recruitment & Employment Confederation and the Institute of Economic Affairs have challenged that view.

See: Interview with Neil Carberry, chief executive, Recruitment & Employment Confederation