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Forbes to support investors as tech startups backed – Daily Business

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Kate Forbes in conversation with robot Ameca at the National Robotarium (pic: Terry Murden)

Deputy First Minister and Economy Secretary Kate Forbes has announced a £5 million package of support measures for start-up tech businesses and said she will create conditions to encourage more investment into Scotland.

The new measures will include an expansion of the business funding competition Scottish EDGE, the development of pre-start support, more encouragement for university research and spin-outs, and investing in initiatives that will attract the world’s top talent.

This new programme builds on the recommendations of chief entrepreneurial adviser Mark Logan’s report into developing a world-class technology sector, and the Pathways report which is focused on expanding the number of women starting and scaling-up businesses.

Tech incubator Codebase, delivery partner of the Scottish Government’s £42 million Techscaler programme, will partner with Scottish EDGE to develop the latest initiatives.

Ms Forbes unveiled the new measures during a visit to the National Robotarium, the UK’s centre for Robotics and Artificial Intelligence at Heriot Watt University.

She said the package of measures “forms the next step in providing one of the most comprehensive government-backed support networks in Europe.

“My message to Scotland’s innovators, entrepreneurs and disruptors is simple but clear: this Government believes in you and we will back you.”

Speaking to Daily Business at the Heriot Watt robotics facility, she rejected a suggestion that in his speech last week when he spoke of “removing obstacles to growth” First Minister John Swinney had accepted it was the Scottish government’s policies, rather than Westminster that had held back Scotland’s economy.

“No. Speaking to businesses here today, every single one of them has chosen to locate here and many of them have an international outlook,” said Ms Forbes.

“They have moved specifically to Edinburgh and they have done that because they obviously believe that Scotland has the right policies and the right talent pool and the right relationships with, for example, the universities.

“I refer you to the hundreds of millions of pounds invested in Scotland last week [in renewables]. You know they could go anywhere in the world so why have they come to Scotland? Because they wanted to do business here. We should reflect on what made those business decisions and try to replicate that.”

Noting the latest figures showing Scotland was again the top location outside London for foreign direct investment into the financial services sector, she said: “My aim is to ensure every investor has the same positive experience and if you do that you are talking about substantially increasing our growth forecasts.”

Kate Forbes, Mark Logan and Ana Stewart at the National Robotarium (pic: Terry Murden)

Founder of the Hunter Foundation Sir Tom Hunter said: “When business and Government come together as they do in financing Scottish EDGE it can drive real economic growth by building the pipeline of entrepreneurial businesses, employment and the taxes that pay for public services.”

Entrepreneur and Investor Ana Stewart, author of the Pathways report on under-representation of women in entrepreneurship, said: “This  is a meaningful step forward in tackling the extreme gender imbalance which currently exists in entrepreneurship.”

Ms Forbes’ comments came as new research sponsored by KPMG shows tech companies confident about growth over the next five years and the latest EY survey on overseas money backing the financial services sector reveals that Scotland continues to attract the most foreign direct investment in the UK outside London.

However, Labour’s Economy spokesman Daniel Johnson claims Ms Forbes has a “mountain to climb’ if she is to turn around the SNP’s record of “failure and decline”.

He has written to Ms Forbes highlighting data showing pay increases and employment continue to lag behind the UK average.

“For 17 years the SNP has squandered Scotland’s economic potential and left us all poorer,” says Mr Johnson.

“The Tories have caused economic turmoil across the UK, but here in Scotland the SNP has made a bad picture worse.

Mark Logan and EIEMark Logan and EIE
Mark Logan: recommended the Techscaler programe (pic: Terry Murden)

“Kate Forbes has a mountain to climb if she is to turn around this record of failure and decline.

“From modernising skills to promoting regional economic development to reforming planning, there is action we can and must take right now.”

He says recent forecasts by EY show that the Scottish economy is predicted to grow more slowly than every other nation and region across the UK makes action all the more pressing.

He calls for Ms Forbes to deliver a comprehensive response to the Withers review on skills, a timetable for reform if this is your intention, and steps for how she plans to combat skills shortages in key sectors across the economy.

Daniel JohnsonDaniel Johnson
Daniel Johnson: action must be taken now

On regional economic development he says Scotland’s regions are “underpowered and under delivering” and notes that Scotland’s performance “now lags many metro authorities which have fewer economic powers”, echoing recent analysis by Daily Business.

“We need a new approach to regional economic development which empowers Scottish regions to take quicker, more focused and more strategic decisions.”

He adds: “Our councils are not incentivised to pursue economic growth through business rates or council tax.’

He says Scotland “slow planning system is holding back much needed housing development and impeding our transition to renewables.”

Mr Johnson says capacity must be increased to ensure the planning system is an enabler of growth not a barrier to it.  

On Friday Ms Forbes told a business audience that the government’s “priority and opportunity” is to unlock the potential of Scotland natural resources and produce.

She was speaking alongside First Minister John Swinney who announced that he wanted more action than strategy documents in order to speed up decision making in areas such as planning.

He said government must have a “can-do attitude” towards removing obstacles and that planning and consultation “must be focused on making things happen.”

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