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Increased support for small businesses
28/12/2008
A grant scheme for small and medium sized businesses is being extended across the whole of Scotland.
Firms in areas of Edinburgh, Aberdeen, Aberdeenshire and Perth and Kinross previously excluded from Tier 3 Regional Selective Assistance (RSA) can now apply for support to help stimulate job creation and economic development projects.
Enterprise Minister Jim Mather said the move will help firm 'weather the global downturn'.
"At a time when the global downturn is clearly affecting Scotland's economy, the Scottish Government is determined to act rather than wait for things to get better.
"We have an economic recovery programme to accelerate investment and stimulate economic development, while targeting support at households and businesses.
"And now we have now decided to extend eligibility for RSA, a tool which - in the absence of tax-varying powers - can be used by the Scottish Government to help small and medium sized firms create and safeguard vital jobs.
"The action we are taking demonstrates that we are on the side of businesses the length and breadth of Scotland. We will continue to use all the tools at our disposal to maximise jobs and investment and ensure Scotland's economy is well positioned for recovery."
RSA is the Scottish Government's main national scheme of financial assistance to industry. It is aimed at encouraging investment and job creation in the Assisted Areas (AAs) of Scotland. It also encompasses support to small and medium-sized enterprises in other areas through Tier 3 support.
Following a European Commission review, Tier 3 was introduced by the Scottish Government in 2007 to offset the implications of a new Assisted Areas map, which resulted in a significant reduction in areas eligible for RSA support. Tier 3 was designed to provide grant coverage for small and medium-sized enterprises in areas of need outwith the new AAs map, albeit at reduced levels of intensity. Earlier this year Ministers approved an increase in aid intensity levels - up to 10 per cent (from 7.5 per cent) for medium-sized companies and 20 per cent (from 15 per cent) for small companies.
Payments of RSA are made in instalments, typically over years, provided that job and project expenditure targets are met. Payment of the maximum amount available is dependant on the project being satisfactorily completed.