Listen
Economic Recovery Programme
15/06/2009
Scottish households and business are benefiting from a range of measures to help them through the recession, with an extra £31 million set to support new housing across Scotland, Finance Secretary John Swinney said today as the the Scottish Government published an update to its Economic Recovery Programme.
The new funding, consequentials from the UK budget, will be focused on accelerating and sustaining investment in new housing developments for affordable rent across the country.
It will also unblock and kick-start private developments to help deliver homes for mid-market rent and low cost ownership and will support around 500 jobs in the Scottish economy.
The update to the Economic Recovery Programme builds on the many actions already underway and focuses on three key areas: jobs and communities; education and skills and; innovation and industries of the future.
It comes on the same day as Scottish Development International publishes strong annual results and provides fresh impetus through measures such as:
- Working closely with local government to allow businesses to defer business rates, easing the pressure on companies as they deal with the effects of recession
- ScotAction, the Scottish Government's skills support package, which will help individuals training for work, training in work and training from work to work
- The Scottish Investment Bank which is being developed to enhance the range of financial support available to growth businesses.
Mr Swinney said:
"Businesses and households rightly demand swift, decisive and comprehensive action to help them through these tough times.
"The update of the Scottish Government's economic recovery programme and the new money for housing shows that across the Scottish public sector we are stepping up to that challenge and delivering what our economy needs.
"The housing funding announced today will be a crucial boost for our construction sector and will provide the kind of affordable housing people need.
"Our recovery programme is already supporting up to 15,000 jobs across Scotland. Going forward, our actions have the potential to support and create thousands more over the long term.
"Since we first published our programme we have added vital measures.
"We are supporting jobs and our communities through measures such as reducing the tax burdens on business and households. Just today we have published details of a scheme we will deliver in close partnership with local government to allow companies to spread 60 per cent of this year's annual increase in business rates over three years.
"Businesses will receive information on this scheme direct from local authorities soon.
"We are strengthening education and skills and will invest £16 million to support an additional 7,800 new apprentices this year and £2,000 as a wage subsidy to encourage employers to take on redundant apprentices.
"And looking to the future we are investing in innovation and industries of the future. That includes investing in areas like renewable energy and taking the first steps to setting up a Scottish Investment bank by identifying funds worth £150 million.
"The pace will not and cannot slacken. That is what the practical, wide ranging measures in our programme will guard against.
"While others may choose to prevaricate over a strictly limited exercise looking at Scotland's long term future, we have made our position crystal clear and instead are getting on with helping prepare this country for a strong recovery."
Mr Swinney will visit the Victoria Mill housing project in Dunfermline today to see work already underway thanks to this Government's decision to accelerate spending in partnership with local authorities.
He will be joined by Housing Minister Alex Neil, who said:
"The provision of affordable housing in the current economic downturn has been my number one ministerial priority.
"This additional funding will allow us to build even more houses, which is not only good news for communities throughout Scotland, but also our hard pressed construction industry."
The Government's funding for affordable housing is already at record levels in the current year, amounting to £644 million. The Scottish Government plans to approve grants for 8,100 affordable homes in 2009-10.
The business rates measures are designed to limit the impact of the annual increase in business rates and will ensure Scottish businesses continue to benefit from more generous rates relief than their counterparts in England. Businesses can choose, if they want, to spread part of the increase over a longer period. The breathing space that gives them will free up some much needed cash this year to help meet the pressures of the current economic downturn and be better placed to take advantage of the upturn when conditions begin to improve.
The small business bonus scheme already saves the average eligible small business around £1,400 on their rates this year. Many thousands of small businesses pay nothing at all.
In response to the current economic situation and the impact of the five per cent increase in business rates from April 1 2009, ratepayers will be allowed to defer up to 60 per cent of the annual increase in their 2009-10 bills until 2010-11 and 2011-12.
This means that all ratepayers will have the option of spreading part of their 2009-10 increase over three years. The new arrangements for deferring 2009-10 liability will not be compulsory for rate payers. Those who prefer to do so will be able to pay off all their 2009-10 liability within the current financial year if they wish.
Under Scottish legislation, the deferral arrangements will be introduced more quickly than in England where legislation is not expected to be brought forward until later this month. An information leaflet and application form will be issued to all ratepaying businesses in Scotland over the coming weeks.