Finance Secretary Kate Forbes admits “serious challenges” over financial support for Scottish businesses
Kate Forbes said her “stark” comment underscored that people who might have considered coming to work in the country are no longer doing so.
She said without immigration controls the Scottish government was limited in what it could do to tackle the problem.
Speaking to Holyrood’s economy and fair labor committee on Wednesday, she also warned that the government’s budget was “severely challenged” when it came to providing additional aid to businesses.
Official figures released earlier this week showed that onshore gross domestic product (GDP) fell 0.2 percent in July from the previous month, although in the three months to July, GDP was said to have grown. by 3.4 percent, compared with February to April.
Asked by MSPs about Scotland’s economic stimulus plans, Ms Forbes noted that online vacancies are 33% higher than in February last year.
She said it was essential to ensure that young people, in particular, had the skills necessary for employment.
But Ms Forbes stressed: “Even if everyone who is currently looking for work were to work, there would still be shortages. The bottom line is – and you see the UK government finally able to accept this – that as an economy we have greatly appreciated the people who have come to this country to work.
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“What we’re finding is that people who might have considered coming here to work are no longer doing so. Maybe it’s because of the high visa costs, maybe it’s because they don’t feel welcome anymore. There are all kinds of reasons.
“At the end of the day, while the Scottish government can come out and say it’s welcome and we really need them, emigration has been the biggest problem in Scotland, not immigration.
“We do not control immigration policy and a number of companies have come to me for help and support on things like the removal of visa fees, which are not under the control of the Scottish government.”
Asked by Colin Beattie of the SNP about the policy levers the government has to alleviate supply chain problems and labor and skill shortages, Ms Forbes said these were “some of the most pressing issues ”facing businesses and potentially“ hindering ”the country’s economic recovery if not addressed.
She said: “When businesses need financial support or need to invest in supply chains, there are things we can consider, but our budget is seriously challenged and, very clearly , solving problems in one area requires that the budget be taken from another area. .
“The financial effort, I think, is quite limited when it comes to solving supply chain or labor market shortages.”
The meeting also heard criticism from Colin Smyth of Scottish Labor of the “crowded” landscape of business support.
Colin Cook, the government’s director of economic development, admitted problems remained.
“We fully recognize the accusation that the landscape for business support remains crowded,” he said.
“I think the agencies themselves accept this and while they have made very good progress in terms of working together, they all recognize that there is more to be done.”