The debate has been interesting, and there has been much agreement on what we should do to support entrepreneurship and innovation in the Scottish economy. I confess that I did not expect to hear discussion about Napoleon, “Star Trek”, unicorns, colostomy bags and umbrellas for whirligigs. That is testament to the innovation and creativity of members of the Scottish Parliament.
In all seriousness, John Swinney is right: we should be ambitious for our country and our economy. At the heart of the debate is the importance of education—encouraging our young people to know that they can do and achieve anything, not to limit their thinking and to understand that working for oneself, being bold and innovative and creating wealth are all positive things to do.
I well remember the young enterprise group at Dumbarton academy, which managed to separate me from £40 for a game. The game was fantastic, but what was more valuable was the lessons that the group learned in the process about the creativity that is needed to generate ideas; the ability to transform a good idea into something that people want to buy; the marketing of a product; and ultimately persuading people to part with their hard-earned cash. I know some of those young people, who have taken those lessons and applied them in college, university and life. I am hopeful for their future and for ours.
Like other members, I will reflect on the past and setting our sights high. I echo what Roderick Campbell and Anne McTaggart said. A quick look at our history gives us a taste of the breadth and importance of our enterprise and innovation.
We are proud of the achievements of innovators, from Alexander Graham Bell’s creation of the telephone to Helensburgh citizen John Logie Baird’s creation of the television; from James Watt’s steam engine to current-day Pelamis wave energy converters; and from Alexander Fleming’s discovery of penicillin to modern genetics, with Dolly the sheep at the Roslin institute of Edinburgh university. Who knew that Scotland invented stamps, postmarks and postcards too? We have a proud history, but it is to the future that we should turn.
If we ask members of the business community what they would like to encourage enterprise and innovation, many of them simply say that they would like a supply chain of well-educated, ambitious and confident young people to emerge from our education system—both as skilled people who they can hire and as entrepreneurs of the future who can create the business and opportunities that we all seek. More than anything, they would say that that is about confidence, drive and—as the Government would observe—a can do attitude.
In that context, I do not want to strain the consensus, but I gently point out that the challenges that are faced in Scottish education are not conducive to creating a confident and skilled workforce. The fact that our levels of reading, writing and maths are declining rather than improving must be a concern to us all. I am pleased that the First Minister recognises that, because we know that the level of inequality hampers our economy, enterprise and innovation, and the progress of our young people, too.
Organisation for Economic Co-operation and Development research suggests that inequality has cost Scotland an estimated 8.5 per cent of gross domestic product over the past 25 years. We want economic growth, we want a strong and prosperous economy and we want enterprise and innovation. Education cannot be just a social policy; it must be part of the Government’s long-term economic strategy.
I recognise and applaud much of the work that universities have undertaken to encourage innovation and to work in partnership with entrepreneurs and business. Taking theoretical ideas and concepts to the market and doing so in collaboration is key.
We know that universities punch above their weight in the quality and amount of research that they do. We know that they work with about 20,000 businesses in Scotland each year. They are more effective at producing spin-outs than universities in the rest of the United Kingdom are. However, they tell us that research funding has been cut by £12.9 million and that the global excellence fund has been abolished. It would help to understand that and whether the Government will consider reversing that.
I turn to other issues that were raised. John Swinney outlined the Scottish EDGE fund’s purpose of providing a boost for companies to realise their goals. It operates very much as a private-public sector partnership. There is much to be welcomed there, and the initiative has been well received by the business community, as it has made a difference to its potential and actual growth.
Murdo Fraser talked about public agencies and asked whether we have too much institutional clutter. I will leave that to the Economy, Energy and Tourism Committee to mull over, but I echo some of his comments, because I have heard positive feedback about Scottish Enterprise and Highlands and Islands Enterprise, particularly from the account-managed businesses. Many, if not all, of the account managers now have expertise in the businesses that they are supporting and partnered with, which has made a huge difference.
At the local end, business gateway provides excellent advice and support in some areas, but the offering is not met with such positivity in others. I hope that the cabinet secretary will take the time to ensure better consistency and at least minimum standards that businesses can expect, whatever part of Scotland they are in.
Graeme Pearson talked about better measuring the things that we do. I whole-heartedly agree with him. We need rigorous monitoring to establish whether the commendable actions in the can do framework produce the results that we want. We cannot afford to be complacent. As others have pointed out, our business start-up figures appear not to be as good as those in other parts of the United Kingdom. Perhaps our businesses are more sustainable, but we do not know unless we measure outcomes, rather than simply inputs, better.
Scotland is a small country, which I regard as a positive thing. We are fleet of foot. If something does not work, we can ditch it and do something better that works, and we can do so quickly. I will illustrate that by touching on innovation centres. There are eight of them and they cover everything from oil and gas innovation to stratified medicine. With Scottish Government investment of £124 million over six years, and an expectation of creating 5,000 jobs, they are an important area of work.
However, we do not appear to be focused on the outcomes that have been or are likely to be achieved. The only jobs that have been created so far, rather than the 5,000 that were anticipated, appear to be in running the innovation centres. It is genuinely difficult to determine whether innovation centres are a good or a bad thing, because we do not measure the outcomes effectively. That is just one example; there are others. Nevertheless, I genuinely hope that the Scottish Government will consider the initiative further, because there is a shared and collective interest in making sure that we get it right.
Graeme Pearson talked about stability and dependability. It is interesting that, whatever businesses I speak to—whether large or small, new or more traditional—they all say the same thing: they want certainty. That is not always easy to guarantee, and they often express that wish in different ways, but they tend to say that they want the environment to be stable, supportive and predictable—those are the words that they use. In that context, they find the prospect of an EU referendum particularly distressing.
I wonder whether the cabinet secretary has done any analysis of the potential impact of an EU exit on jobs and exports. The EU matters to the Scottish economy and I am extremely supportive of it. We need to understand the facts, and I hope that the cabinet secretary will be alive to conducting some of that analysis. I will not mention other referenda, but we need to ensure—where we can, whenever we can—that we create a stable framework in which business can flourish and investment decisions are made in Scotland’s interests.
I will conclude by turning to the subject of women. Let us not forget their contribution, which Linda Fabiani and Siobhan McMahon touched on. Siobhan McMahon was right to talk about STEM subjects and the difficulty that women have in getting on to part-time courses at college. I pay tribute to Women’s Enterprise Scotland, whose purpose is to create an entrepreneurial environment in which women-led businesses can grow and flourish. It is important to our economy that we close the gender gap, as there are really low rates of participation in entrepreneurship among women.
The statistics tell us that only 21 per cent of Scotland’s 340,000—I think—SMEs are led by women and that men are still twice as likely as women are to start businesses. I recognise that as an international problem, but our rate of female business ownership is persistently low when compared with rates in similar high-income countries. There is much work to be done on that.
As John Swinney rightly pointed out, if women’s business ownership rate was equal to men’s, we would have something like 108,480 extra businesses, which would represent a 32 per cent increase in our business base and lead to an increase of £7.6 billion in GVA, to a staggering £13 billion. That would be 5.3 per cent growth in the Scottish economy, so we cannot afford to ignore it.
John Swinney talks about a renaissance in entrepreneurship. Let us make that happen for women, men, all our current entrepreneurs and, I hope, all our future ones, too.
16:48