Programme for Government must close the skills gap to support sustainable economic growth - CBI Scotland

CBI Scotland is calling on the Scottish Government to make closing the skills gap a priority in the Programme for Government to boost productivity and long-term sustainable growth.

In a letter to the First Minister, CBI Scotland argues that a coordinated national skills strategy and action plan with clear targets, metrics and bringing together business, education, and government is needed to future-proof the workforce.

Publishing its Programme for Government submission, Scotland's leading business group says skills funding needs to be more closely aligned with industry skills and training needs. This will capitalise on the country's strengths which includes a highly educated population, reputation as an energy powerhouse, world-renowned natural resources and two green free ports.

Alongside the focus on addressing the skills gap, CBI Scotland's Programme for Government submission puts forward a bold, ambitious suite of policies for kickstarting growth by focusing on maximising the green growth opportunities available to Scotland, taking concrete steps to improve infrastructure and connectivity, and building a competitive business environment to unlock investment.

Michelle Ferguson, Director, CBI Scotland, said:

"The First Minister must seize the opportunity in this accelerated programme to outline how the government plans to play its part in tackling the skills shortages that are holding back growth.

"We need to enable businesses to access and develop skilled workers who are ready to meet the challenges and opportunities ahead. Achieving a better balance between classroom and work-based training and short, sharp provision to help upskill and reskill workers for the clean energy transition would support these ambitious goals.

"The government should also be working closely with businesses and the further and higher education sectors, which are the jewel in the crown of Scotland and its capabilities, to build opportunities to equip people with digital proficiency and the skills to match advances in technology as we build Scotland's workforce of the future.

"Removing barriers to electricity infrastructure, publishing the Climate Change Plan, building thousands of new homes and reviewing tax divergence between Scotland and the rest of the UK will attract more highly skilled staff to Scotland, shoring up public finances and boosting productivity and growth."

CBI Scotland has identified four key areas for the Programme for Government on 6 May that will put Scotland on the path to achieving its economic ambitions.

This goal can be achieved by:

1. Futureproofing the labour market and boosting productivity

• Announcing a consolidated skills strategy and action plan setting out the role of businesses, schools, colleges, further/higher education, and government in future-proofing the labour market and boosting productivity.
• Closer alignment of skills funding with industry needs, a better mix of undergraduate and work-based learning. Short, sharp provision for upskilling and rapid retraining is also needed.
• Demand-led expansion of apprenticeships to create wider opportunities and support Scotland's net zero transition.

1. Green growth opportunities

• Setting out concrete actions, detailed implementation times and clear funding to build on the current Programme for Government and Green Industrial Strategy.
• Publishing the delayed Climate Change Plan to give investors certainty and boost business confidence.
• Using the government's full range of policy levers to address long-standing barriers to growth, including speeding up the construction of electricity transmission infrastructure and streamlining grid connection processes.
• Announcing a campaign to make people aware of the importance of new energy infrastructure to safeguard energy supplies and achieve net zero.
• Providing a route-map and fast-tracked funding for electric vehicle infrastructure.

1. Improving infrastructure and connectivity

• Publishing a strategy for retrofitting and repurposing existing infrastructure, outlining key projects and timelines for development.
• Ringfencing funding to improve critical road routes and setting a strategy to reduce travel time between key Scottish economic hubs, and other UK cities.
• By the government announcing plans to build 25,000 new, high quality, energy efficient homes, supporting employment in the construction sector.

1. A competitive business environment

• Ensuring the economic strategy puts long-term economic growth ahead of short-term revenue raising plans giving certainty to business and supporting international competitiveness.
• Avoiding further income tax divergence between Scotland and the rest of the UK.
• Launching an independent review of tax divergence to examine how this affects Scotland's overall competitiveness.
• A longer-term review of the non-domestic rates system.