This item was published during the term of a previous administration that ended in April 2007
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New measures to support business
21/12/2006
New measures to increase business investment, employment growth and research and development in Scotland were announced today.
Following a wide-ranging review of business support carried out earlier this year, a simplified national grant structure will be introduced in 2007.
Included will be a new tier of Regional Selective Assistance (RSA) grant for small and medium sized enterprises (SMEs) across large part of south, east and west of Scotland, including all the areas which lose Assisted Area status as part of the EC's new regional aid map unveiled this week.
Key developments include:
- A revised RSA scheme will operate from January 2007, including a new tier of RSA-type assistance for Small and Medium Enterprises (SMEs)
- The existing SMART, SPUR and SPUR PLUS schemes will be consolidated into an R&D scheme for SMEs to operate from April 2007
- A new general R&D scheme (consolidating R&D PLUS, SCIS and SCORE) will operate from September/October 2007
Deputy First Minister Nicol Stephen said:
"The range of national grant schemes we offer businesses to support investment, growth and R&D are broadly recognised as successful, but with some scope for change and improvement.
"We have worked closely with business organisations to address the key issues of simplicity, transparency and consistency.
"As a result, the new measures I am announcing today deliver a simplified grant structure that is consistent right across the country - improving the effectiveness and efficiency of our grant delivery system.
"These national grants play a key role in helping deliver our top priority of growing the economy. Over the course of 2007, we will consolidate eight grant schemes into three new schemes - a single regional investment grant and two R&D grants, including a premium grant for SMEs only.
"The budget available for grants to business will be maintained at least at current levels."
On the specific issue of the new tier of RSA grant being offered to SMEs, Mr Stephen added:
"The Assisted Areas map confirmed this week by the EC presents a fair an equitable outcome for Scotland, and we should welcome the success of seeing large parts of Scotland move out of the poorer performing areas.
"The new AA map targets coverage at areas of greatest need and opportunity for large scale development.
"We recognise, however, that there are specific challenges facing smaller businesses in other areas of the country, including all areas that have just lost AA coverage.
"That is why we are introducing a new regional investment support package to sustain and grow SMEs in large areas of south, east and west Scotland outwith the new AA map."
Background:
The European Commission approved the Assisted Areas map for the UK for the period 2007-13 earlier this week. Scottish coverage has been reduced in line with the rest of the UK. The map for Scotland (with Highlands and Islands already guaranteed higher intensity cover until 2010) means population coverage of 37 percent, which reflects relative economic performance. The AA map details can be found at http://www.stateaidscotland.gov.uk/
Almost 500 CAS (Census Area Statistic) wards in 27 local authority areas (outwith Highlands and Islands and the new AA coverage areas) will now become areas where a new support scheme for SMEs offering and RSA-type grant will be available. These include all wards which will lose AA coverage from the 2000-2006 map. The SME RSA coverage map and detail of wards can be found at http://www.stateaidscotland.gov.uk/
These wards were selected using the following criteria:
- All Census Area Statistic (CAS) wards currently with AA status but not included on the new map. Ward boundary definitions undergo changes on a fairly frequent basis and to maximise the amount of reliable data available it was necessary to use the CAS 2003 wards, which relate to the 2001 census, as the basis of the map
- Wards within a local authority area adjacent to and including 87.3.a areas. 87.3.a areas are regions, due to their particular economic circumstances, directly allocated assisted area coverage by the EC at higher aid rates. In Scotland this is the NUTS 2 defined Highlands and Islands area
- CAS wards in areas which either qualify under the EC 'first filter' rule - determined by comparisons of GDP and unemployment of EU and UK averages - or are adjacent to 87.3.a assisted areas and which qualify on the economic indicators used for the AA map.
Under the EC SME Block Exemption, for SMEs in these areas maximum aid rates are 15 per cent for small companies and 7.5 per cent for medium sized companies.
Highlands and Islands Enterprise will continue, as at present, to operate its own business support with access, where necessary, to national schemes.
In light of the strong business backing, the SMART awards will continue within the premium R&D grant scheme.
The Scottish Executive Enterprise department is consolidating its grant management and delivery functions within a single new operational division. There will be an increased focus on joined-up delivery between the Enterprise Department and the Enterprise Agencies, with the new schemes subject to detailed evaluation, consultation and review.