Business

Scott Wright: Omicron has renewed tension between business and Scottish ministers, but does it have to be this way?

THE relationship between business and the Scottish Government has come under pressure at regular intervals since the pandemic began. But there is no doubt the emergence of the Omicron variant in recent weeks has brought particular strain to dealings between the two camps.

Measures recently introduced to combat the highly transmissible variant, which has continued to surge over the festive period, have stoked renewed tension between ministers and the night-time economy. Industry figures have become increasingly frustrated that businesses are bearing the brunt of public health rules once more, and fear the toll that a further spell of restrictions could have on the viability of many hundreds of firms.

That UK Prime Minister Boris Johnson continues to believe the scientific data do not support the tightening of restrictions in England (Wales and Northern Ireland have, like Scotland, acted to bring in mitigations) only appears to have inflamed matters, amid reports that some Scots are planning to venture south of the Border to celebrate Hogmanay because major parties will not be taking place here.

John Swinney, Scotland’s deputy first minister, has implored people not to make the trip, declaring that it would not be in “the spirit of the rules we are putting forward”.

Nightclubs in Scotland were closed for a three-week period that began at 5am on Monday (December 27) and major events such as Edinburgh’s Hogmanay street party have been cancelled. And there are now fears that the enforced hiatus could be longer, partly because of the experience of last year when an initial “circuit breaker” gave way to a prolonged period of lockdown.

READ MORE: Dismay voiced over delay to Scotland’s economic transformation plan

Moreover, until yesterday there had been a growing feeling that the general restrictions – which apply to a broad range of settings, including football matches – could be strengthened further still. National Clinical Director professor Jason Leitch warned on Tuesday that although a legal review of restrictions takes place every three weeks, “that doesn’t mean things can’t go up or down in the middle weeks”.

However, First Minister Nicola Sturgeon refrained from adding further restrictions yesterday. The next legal review is due to take place on January 11.

While the public health measures being implemented by the SNP administration are being driven by scientific advice and understandable concern over the impact on the health service, the tightening of restrictions has done nothing to soothe the relationship between ministers and businesses that has been under serious strain throughout the pandemic.

The difficulties in the relationship are not solely down to the way restrictions have affected sectors such as tourism, hospitality and the night-time economy since the pandemic began in March 2020. Concern has persistently been expressed across the wider business community that the Scottish Government simply does not “get” business.

Sir Tom Hunter, one of Scotland’s most successful business figures, gave his own thoughts on the matter last week. In an exclusive interview with The Herald, Sir Tom explained that early in the pandemic he had commissioned a series of papers from prominent business figures, including fund manager James Anderson and entrepreneur Lord Willie Haughey, to help inform Scotland’s recovery from the pandemic. The papers were submitted to the Scottish Government. Asked to comment on the response they received, Sir Tom said: “It’s fair to say, they make a point of saying they are listening, I’m not sure. I will judge them by their actions, not their words.”

READ MORE: Sir Tom Hunter: We should judge government by its actions, not words, on business

When asked if he shared concern expressed in some quarters that ministers do not understand the challenges facing business, Sir Tom replied: “It is a hard job and I appreciate it is a hard job. But what I am saying is… the authors of those pieces… are excellent people who care about Scotland, [and] are not in it for anything apart from helping Scotland. I think they deserve to be listened to, and their points acted upon. I think Scotland would be better if that happened. As I say, the jury is out.”

The feeling held by some that ministers are not fully behind business was further fuelled later last week, when it emerged that the Scottish Government had delayed the publication of its much-anticipated 10-year economic transformation strategy. The strategy, which is being shaped by an advisory council including business experts, economists and academics, had initially been expected to appear in the autumn.

However, Finance Secretary Kate Forbes declared last Wednesday that it was “not the right time” to publish the blueprint, citing the ongoing demands of dealing with the Omicron variant.

While the demands of the pandemic mean the decision is understandable – indeed, some business voices were sympathetic to the situation the Scottish Government finds itself in – some commentators were disappointed. For some, it was another sign that business falls some way down the pecking order in terms of the current priorities of the Sturgeon administration.

READ MORE: Scott Wright: Stagecoach sale is a further blow to Scottish prestige

Liz Cameron, chief executive of Scottish Chambers of Commerce, declared that “many will be disappointed with this further delay” to the publication of the strategy.

Ms Cameron, who has previously called for a “reset” of the business-ministerial relationship, said: “The return to economic growth remains in the balance and Scotland’s businesses and our employees are working incredibly hard to survive the latest round of restrictions and enhanced regulations. Businesses are suffering and their focus right now is on survival, but they need to see a long-term economic plan.”

Other critics included financial services veteran Guy Stenhouse, former managing director of Noble Grossart, who branded the delay a “bad mistake”. He said: “Covid should not be used as an excuse for delay.”

Some were more sympathetic. Colin Borland, director of devolved nations at the Federation of Small Businesses, said the “immediate issue for everyone is dealing with Omicron and the economic fall-out from the restrictions imposed to combat its spread.” But he also emphasised the importance of “not losing sight of the longer-term objective of building a fairer, more resilient and more sustainable economy”.

It seems clear from the current direction of travel with Omicron that things are going to get tougher for businesses as the wave of infection builds up to an expected peak towards the end of January. And it will never be an easy task for government ministers to balance the needs of health and the economy.

But it is hard to escape the impression that a little more understanding of business, and a willingness to act on its advice, would be a step in the right direction.

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