Welcome to our regular monthly collection of news and announcements that impact Scottish accountants and their clients.
As we enter Autumn you’ll continue to be busy on their behalf – which is why we created our accountants hub in the first place so you’ll have access to the most important and accurate insolvency information whenever you need it.
But you can’t read everything and be everywhere at once, so we collect the most interesting and important business and insolvency news stories every month along with new blogs on a range of topics each and every week.
We’re always keen to hear what you think so email us at ask@businessrescueexpert.co.uk because we really want to write what you want to read!
Scottish financial sector can seize green opportunities
Kate Forbes, the Deputy First Minister, has said Scotland can become a “true global contender” in the race to capture new economic opportunities from growth in green financial services.
She stressed the sector has the potential to benefit from the “enormous investment that will flow into net zero projects and assets” and as one of the world’s oldest financial centres – Scotland would be ideally placed to benefit.
A taskforce report is due to be published imminently that will recommend actions including looking at new ways for the government to attract more financial institutions to “build their sustainable and green businesses in Scotland.”
It will recommend collaboration across sectors and academia to support the upskilling of Scotland’s workforce in sustainable finance.
In the Scottish Government’s response, Forbes says: “The recently published green industrial strategy has a clear overarching aim: to help Scotland realise the economic benefits of the global transition to net zero.
“There are few areas of greater competitive advantage and potential than green and sustainable financial services. Set in this context, it is with particular pleasure and optimism that I welcome the report of Scotland’s taskforce for green and sustainable financial services.”
The Scottish Government and the Global Ethical Finance Initiative launched the taskforce in 2022 to examine questions such as “How could Scotland’s financial services industry leverage the enormous investment that will flow into net-zero projects and assets, both here and abroad, to build up a green financial services cluster?”
Forbes said: “The world saw in Glasgow in 2021 that Scotland had both a progressive energy and climate-change policy at home and the convening power to deliver real advances on climate finance on the global stage.
“We knew that Scotland could be a natural home for green and sustainable finance because the foundations are strong – in Scotland, large financial institutions are clustered alongside professional services firms, energy and technical experts, and specialist businesses across a range of disciplines.”
The report will make 31 recommendations on how the public and private sectors can work together to encourage and fund green investments.
David Pitt-Watson, chair of the Scottish taskforce for green and sustainable financial services, said there is a huge opportunity for Scotland’s financial services industry to “serve the world.”
He said: “Climate may be the greatest challenge facing humankind. Addressing it will require a huge investment and the services of the finance industry.
“Finance is a jewel in Scotland’s industrial crown. So not only should there be many opportunities for green investment in Scotland, from wind to housing, there is also a huge opportunity for its financial services industry to serve the world.”
Scotland registers three quarters of growth
Scotland has recorded its ninth consecutive month of growth according to the latest Royal Bank Regional Growth Tracker.
While continuing a positive growth trajectory in 2024, the rate was slower than in the four weeks to September. The Headline Business Activity Index fell to 51.2 from 52.7 in August owing to cooling growth in the services sector.
However, the negative impact from manufacturing nearly disappeared as output fell fractionally. Modest growth in output was supported by a sustained, albeit mild increase in new business.
The labour market remains strong for the Scottish private sector and is currently outstripping the UK-wide average. The rate of job creation hit a 16-month high and signalled a sharp rise in staffing levels with growth being driven by service firms as manufacturing employment remained broadly stable.
Judith Cruickshank, chair of the Scotland Board at RBS said: “Scotland wrapped up the third quarter on a positive note. Sustained growth in new business inflows enabled firms to increase their activity levels although the pace of growth slowed.
“Job creation reached its highest level since May 2023 although the steeper decline in factory orders indicates more challenges for the Scottish manufacturing sector in the coming months.
“The uncertain political and economic landscape will also act as headwinds to growth leading the Scottish private sector to increasingly depend on its service firms to drive the economy forward in the coming year.
“However price pressures remained on an easing path, with cost burdens rising at the weakest pace in 43 months.”
Scottish business confidence down
Companies in Scotland reported lower confidence in their own business prospects month-on-month according to The Business Barometer survey which logs the views of 1,200 UK businesses monthly to provide early signals about UK economic trends regionally and nationwide.
Scottish business confidence fell to 49% last month compared to 64% in August. This remains slightly higher than overall UK business confidence which fell to 47% compared to 50% in August.
Looking ahead to the next six months, Scottish businesses identified their top target areas for growth as entering new markets (37%); investing in their team through training (35%) and introducing new technology such as AI, automation or digitalisation (30%).
Martyn Kendrick, Scotland director at Bank of Scotland Commercial Banking, said: “Despite this dip, which mirrors the broader UK trend, it’s great to see that Scotland remains one of the most optimistic regions in terms of its economic outlook.
“This optimism is well-deserved, given the array of events coming to Scotland this autumn, promising a boost for local SMEs. The news that Glasgow will host a version of the Commonwealth Games in 2026 will bring even more global attention to our shores, too.”
Scottish Skills shortages could prove problematic
A new report has revealed how significant challenges including skills shortages and an ageing population, pose a risk to Scotland’s economy.
A thought leadership report titled Skills for Today and Tomorrow conducted by the Fraser of Allander Institute (FAI) looked at the current skills landscape as well as demographic and technological challenges facing Scotland analysing key labour market trends.
It highlights a marked increase in job vacancies and a growing mismatch between the skills available and those demanded by employers. It references one in four Scottish employers reporting vacancies with nearly a third (31%) classified as skill-shortage vacancies.
Skilled trades, associate professionals and professionals claimed to be the most affected areas with shortages in technical, analytical and digital skills reported as most prominent.
The report also highlights a lack of alignment in education and training, specifically on skills taught and those required by rapidly evolving industries such as technology and renewable energy.
The report also highlights how an ageing workforce is presenting a significant economic challenge with the number of over-65s in Scotland expected to rise by a third over the next two decades.
Key sectors such as construction, health care and transport are under threat from workers retiring and raises concerns about the urgent need for workforce planning to mitigate impending staff shortages.
Professor Mairi Spowage, director of the Fraser of Allander Institute said: “As well as highlighting key economic challenges, this analytical report explores how Scotland can leverage its world-class education system, burgeoning tech hubs and leadership in renewable energy to ensure its workforce can meet the challenges of today and seize the opportunities of tomorrow.