Last year, we asked businesses about their current opinion on their relationship with the Scottish Government, against the backdrop of the ‘New Deal for Business’.
In our latest Scottish Business Monitor (SBM), we revisited these same questions to track progress and understand what has changed, aiming to help understand the Scottish Government’s performance over the past year – as we committed to do in our previous report.
The survey sampled over 350 firms in August and September from across the Scottish economy.
We asked Scottish firms the following three questions, identical to those asked last year –
- To what extent do you agree or disagree with the following statements?
- The Scottish Government understands the business environment in Scotland.
- The Scottish Government engages effectively with my sector if it is considering policies.
- If I wish, I know an effective route to influence Scottish Government policy if new announcements are likely to affect my business.
For the second consecutive year, only 9% of surveyed firms agreed or strongly agreed that the Scottish Government understands the business environment in Scotland, while 62% disagreed.
The net balance for this question improved by 1 percentage point compared to last year.
There was a slight decrease in the percentage of firms that believe the Scottish Government engages effectively with their sector, dropping from 8% in 2023 to 6% in 2024. This resulted in a net balance of -62.
While a stable 19% of firms agreed that they know an effective route to influence policy, disagreement on this issue rose from 39% in 2023 to 46% in 2024. Consequently, the net balance for this question worsened from -21 to -28, indicating increased dissatisfaction among responding firms.
We also find that Construction and Finance firms were more likely to disagree with the first two statements, whereas firms in the Professional and Administrative sectors were most likely to agree.
Overall, these results indicate that the business community remains unconvinced that the ‘New Deal for Business’ has improved their relationship with the Scottish Government. Across all three areas—understanding, engagement, and routes to influence—there has been little to no meaningful progress. Instead, the findings indicate that this relationship has either stagnated or deteriorated further.
The Fraser of Allander Institute will continue to ask businesses these three questions once a year, providing the Scottish Government and business community with an annual update.
Authors
João is Deputy Director and Senior Knowledge Exchange Fellow at the Fraser of Allander Institute. Previously, he was a Senior Fiscal Analyst at the Office for Budget Responsibility, where he led on analysis of long-term sustainability of the UK's public finances and on the effect of economic developments and fiscal policy on the UK's medium-term outlook.
Brodie is a Knowledge Exchange Assistant at the Fraser of AllanderInstitute.She has recently completed an MSc in Applied Economics at the University of Strathclyde and has a first-class Honour’s degree in Economics and Politics from the University of Glasgow