Business: New Deal for Business Group minutes: March 2024

Attendees and apologies

• Cabinet Secretary for Wellbeing Economy, Net Zero and Energy (Co Chair)
• Dr. Poonam Malik, Head of Investment, Strathclyde University (Co Chair)
• Colin Borland, Federation of Small Businesses (FSB)
• Catherine McWilliam, Institute of Directors (IoD) Scotland
• Sara Thiam, Prosper
• Charandeep Singh, Scottish Chambers of Commerce (SCC)
• Sandy Begbie, Scottish Financial Enterprise (SFE)
• James Fowlie, Convention of Scottish Local Authorities (COSLA)
• Fiona Richardson, Convention of Scottish Local Authorities (COSLA)
• Nora Senior, Co-Chair ILG Chairs Roundtable
• James Sloan, Confederation of British Industry (CBI) Scotland
• Barry White, Chair NSET Board
• Nathalie Agnew, Muckle Media
• David Lonsdale, Scottish Retail Consortium (SRC)
• Georgia Watson, Business in the Community Scotland (BiTCS)
• Marc Crothall, Scottish Tourism Alliance (STA)
• Karen Meechan, Scotland IS
• Professor Russel Griggs

Apologies 

• Iain Baxter, Scotland Food and Drink (SFD)
• Mairi Spowage, Fraser of Allander Institute (FoA)

Items and actions

Key Points and Actions from Meeting

Cabinet Secretary’s Opening Remarks

The Cabinet Secretary welcomed everyone, noting this was her first meeting and the first meeting of the group in its new governance role. Cabinet Secretary stressed that she is committed to economic growth and supporting business in that growth and reaffirmed her commitment to the New Deal for Business (NDfB), recognising the importance of a strong line of communication between business and government to deliver an improved business environment to maximise growth.

She noted that processes being delivered by the New Deal for Business Group (the Group) should be iterative, accepted that there will be learning along the way, and she is keen that the Group keeps challenging each other and scrutinises outcomes, to ensure all parties are getting what they need from it. Cabinet Secretary noted the exceptionally busy policy platform and the importance of business, and the Group being involved in that process. 

To maximise everyone’s valuable time, bring sharper focus to the Group’s discussions and elevate the ambition, it was proposed that an outcomes approach be used for reporting and discussion at the meeting. This approach will inevitably be evolved over time, as actions and outcomes are delivered. The Group was assured of the commitment to 78 actions and that these would be measured, however, Cabinet Secretary stressed she is keen that the meeting focusses on real-world change.

In addition, the Cabinet Secretary indicated she was open to considering a merger of Subgroups 1 and 2 to maximise time and optimise synergies. The 6 outcomes proposed were:

• deliver an improved regulatory environment 
• establish a mechanism for Ministers to scrutinise policy and regulatory decisions and impact affecting business 
• change the culture toward business across Scottish Government, in order to increase understanding of how business interests intersect with policy 
• deliver NDR system that delivers the most competitive environment to do business whilst supporting our communities
• deliver a shared understanding of how government and business work together on achieving a Wellbeing Economy 
• deliver an agreed mechanism for gathering and sharing intelligence

 

Dr Malik’s Opening Remarks

Dr Malik welcomed those in the room and online, welcomed Nora Senior to this meeting and Karen Meechan to her first Group meeting as a replacement for Gopalan Rajgopalan. Dr Malik thanked Mr Rajgopalan for his contributions to the Group.  

Dr Malik noted the proposal for the 6 outcomes and looked forward to Group views. She recognised the letter that some members had written to the First Minister and that he had offered a meeting with the whole Group along with the Co-Chairs, in response. Dr Malik welcomed that invitation, acknowledging some challenges and discomfort amongst Group leaders and their own wider membership in response to Scottish Budget and that concerns remain. She suggested this demonstrates the importance of the Group, and good communication and trust, to making progress. 

Comments from the Group on the proposed streamlining, included:

• measurement of the outcomes and accountability for achievement

SG confirmed that the 78 actions to deliver the recommendations would continue but the intended focus would be on the overall outcome.

 

Progress Update

Dr Malik talked to the report that offered a progress update, focusing on the 10 key actions that were highlighted in the Implementation Plan as likely to have the most immediate impact. She noted the potential risks to achievement of systematic mapping of engagement due to early resource constraints.

Dr Malik suggested that the proposed merger of subgroups 1 and 2 (Regulation and Business Partnership) should offer resource efficiencies to enable that to be completed by October and noted that the Group could be confident that we are beginning to make some progress. Suggested keen not to create any further metrics, whilst reporting in a meaningful way. 

The Group’s main points on performance reporting, included:

• representation of RAG rating on the report, noting that Red, Amber (Yellow) and Green is better recognised and would highlight a more positive and realistic picture
• welcomed the work done so far and cited improvements such as working more closely with Public Health Policy, which has been helpful. Noted more to do on, for example, Finance policy
• red RAG rating for Key Actions 3 (policy cycle) and 4 (engagement mapping across SG policy areas). The Group considered these to be key and foundational to the work and concerned about the risk of missing this deadline. Priority focus is needed to resource this work appropriately with a level of urgency applied
• stressed the need for, and importance of, policy alignment across SG with business/ economy in delivering on the overall aim of economic and productivity growth. Discussion around the need for early engagement to ensure initial policy solution is the right one and to ensure any policy and business interdependencies are worked out at the outset, with real clarity on what Scottish Government is trying to achieve
• noted the dual aims of creating the behaviour change and engaging at the right points in the process and recognition that culture change is key and will take time
• noted the importance of language for reporting, such as "delivery of effective guidance” when delivery may happen but how is effectiveness measured thereafter
• recognition that Scottish Government will have policies to introduce that it is democratically elected to deliver, and the Group will need to work with that

Comments from Scottish Government in response:

• recognised that improvements to consistency of engagement are needed, along with policy alignment and removal of unintended consequences
• accepted some learning from the Budget Process and that can help with the Programme for Government development process. Noted the importance of adherence to principle of no surprises
• understood that policy cycle is a priority to the Group
• happy to progress suggested amendments to reporting and offer more granularity for information, however, keen that the conversation focuses on the outcomes

 

Regulatory Review Group (RRG) Presentation with Q&A and reflections from Group

Professor Russel Griggs, OBE and Scottish Government official Ross Stephen presented to the Group on the ongoing work of the newly reinstated and refreshed Regulatory Review Group (RRG). The presentation covered how the New Deal for Business Group is about business working in partnership with Government and the RRG’s focus is to ensure policy is implemented effectively, taking into account the views of those it will impact. It was noted that for the sake of accountability and transparency, all advice and minutes of the meetings are published on the RRG’s page of the Scottish Government’s website. 

It was noted that policy officials from other parts of SG were now actively seeking out an opportunity to present to the RRG in order to gain feedback and advice and seeing this as a valuable step in the process. Professor Griggs OBE highlighted how the RRG is an iterative process in which policy officials may return multiple times as a policy is developed. A recent example of the RRG consideration was the Heat in Buildings Bill advice giving valuable feedback and holding the Government to account.

The Group’s main points on RRG 

• return of the RRG welcomed, particularly given the volume of regulation being develop in Scotland (in addition to UK regulations). Suggested that Parliament legislation should be covered by RRG as well
• noted the importance of language and tone to ensure culture change, as well as communication in this process. Ensuring that the feedback loop is complete also important
• concerns raised around the number of regulations coming into force which will affect certain sectors more than others, with a discussion around the RRG’s workplan and how members of the NDBG can contribute
• noted that the RRG is not a substitute for stakeholder engagement and is not the primary mechanism for officials to engage with stakeholders
• stressed that business need to have an opportunity to be involved in policy development at an early stage, so that business contributes to thinking about how an issue is tacked, rather than being presented with a preformed solution to that issue, and then asked to comment on that
• suggested that work should be taking forward to investigate the effectiveness of regulations that may no longer be required with a view to removing these regulations. Noted that Scottish Chambers of Commerce previously sent to Scottish Government for review, a list of regulations that its members felt were no longer required. It was agreed that some regulations may still be necessary but not in their current form. Consideration should be given to included removal of regulation in the RRG Terms of Reference

The Cabinet Secretary recognised the value and expertise of the RRG to Ministers. She indicated that at her request, a formal mechanism is currently in development on how Ministers engage with the Group and a process designed to report and measure the outcomes of the RRG and their recommendations, which will offer the Cabinet Secretary oversight.

 

Communications to recognise 6-months mark of Implementation Plan

The Cabinet Secretary invited views from the Group on how to recognise the 6-month mark in April. 

Dr Malik suggested jointly produced and agreed communications would be welcome, noting it was important to address concerns around business not feeling important to Scottish Government or local authorities. It was noted that communications should be forward looking recognising that the Group may not have got everything right yet, however, this is what we’re doing and the direction of travel. Dr Malik suggested that business should be accountable, and when bringing a challenge to government should also look to bring and offer possible solutions and support them in public forums, if aggreable. 

 

AoB

Members welcomed the opportunity to co-produce the agenda and for papers to issue with sufficient time to consider content. 

Actions

• NDBG programme office to review RAG rating for reports, with focus on Red Amber Green and removal of blue with updated reporting available for the next quarterly meeting in June 2024 – completed 
• NDBG officials to further explore the outcomes approach to ensure current measurement is appropriate by 31 March 2024 – completed 
• NDBG members to share their suggestions for removal of regulations with NDBG officials 25 April 2024 - completed
• NDBG officials will work with stakeholders through the Regulation Subgroup and the Regulatory Improvement Advisory Group to identify the most appropriate route to capture and prioritise these for consideration by the New Deal for Business Group, no later than 31 May 2024 - ongoing 
• NDBG officials to further explore amalgamation of subgroups 1 (Regulation) and 2 (Business Partnership) to maximise synergies and remove duplication and time for members - completed 
• NDBG officials to further explore the options of an additional ministerial scrutiny level for all policies and regulations impacting business - ongoing