Leading the future: our vision for Scotland’s economy

We live in a time of economic transformation – presenting challenges as well as opportunities.

We’re seeing that transformation across the Western world.

Technological change, particularly automation, is driving a new industrial revolution.

The threat posed to our environment by man-made climate change demands attention.

And we’re living longer, healthier, lives – meaning our population is getting older.

But our economy faces other challenges, caused by policy made at Westminster.

A chaotic Brexit threatens jobs and living standards and almost a decade of austerity has caused rising inequality and poverty.

For Scotland, it is clear that we must either lead the future or be overcome by its challenges.

As Cabinet Secretary for Finance, Economy and Fair Work, this is my focus.

Of course, we’ve already delivered a great deal of progress for Scotland.


More people are in work than when the recession hit and youth unemployment is now amongst the lowest in Europe.

Our economy is growing faster than the UK as a whole, exports are up 44.7 per cent since 2007 and our higher education R&D spend is the fifth highest in the developed world.

But if we are to to lead the future, we have to go much further.

So to boost innovation we’ve increased business R&D funding by 70 per cent and we’re establishing a £65 million National Manufacturing Institute for Scotland.

To provide businesses with the long-term investment they need to grow, we are setting up the Scottish National Investment Bank.

To secure a transition to a low carbon economy and meet our world-leading climate change targets, a £60 million Innovation Fund will support the development of green infrastructure.


We’re stepping up action to support people into work too. We’re boosting apprenticeship places; we’ve created the £96 million Fair Start Scotland employability scheme; and a new £500,000 fund seeks to break down barriers to work for women, disabled people, older people and ethnic minorities.

By making Income Tax fairer, we’re pushing back on Westminster austerity and investing more in schools and hospitals. And we’re supporting people who deliver vital public services by lifting the public sector pay cap.

Yet migration policy made at Westminster is turning away talented people that want to work in Scotland’s public services. We’ve seen teachers refused visas and a drop in nurses from the rest of the EU applying to work here.

Migration supports our public services, contributes to a strong economy and helps tackle the challenges of an aging population. But all of the powers to take a unique approach – one that works for Scotland’s economy – lie at Westminster.

Migration isn’t the only economic issue that lies beyond our control. Business taxation; trade policy; employment law; and our relationship with Europe – all decided at Westminster.

So while we know Scotland is a wealthy country, some of the most important levers we need to grow as a nation are outwith our control.

And it’s not hard to find examples of how we could build a better future with full control of our resources.

We see all around us small independent European nations that are amongst the happiest, healthiest and most prosperous in the world.

An independent Scotland would be well placed to join them.

But, as we work to achieve that goal, we remain resolutely focussed on building a better Scotland today.

In the coming months I will deliver my budget plans for the year ahead – against a backdrop of continued Westminster-driven austerity and a damaging Brexit, it will be a budget for the future.

It will be a budget that steps up our efforts to tackle climate change; to support innovation; and make Scotland fairer.

Most importantly, it will be a budget that ensures Scotland can lead the future.

Derek Mackay is Cabinet Secretary for Finance, Economy and Fair Work.