Scotland's National Strategy for Economic Transformation - Equality Impact Assessment (Record and Results)

Equality Impact Assessment - Results

Title of Policy

Scotland's National Strategy for Economic Transformation

Summary of aims and desired outcomes of Policy: The aim of NSET is for Scotland to be a wellbeing economy, thriving across economic, social and environmental dimensions.

NSET sets an ambition for Scotland to become:

• Fairer: Ensuring that work pays for everyone through better wages and fair work, reducing poverty and improving life chances.
• Wealthier: Driving an increase in productivity by building an internationally competitive economy founded on entrepreneurship and innovation.
• Greener: Demonstrating global leadership in delivering a just transition to a net zero, nature-positive economy and rebuilding natural capital.

Each of the six NSET Programmes of Action include their own aims and outcomes.

Directorate: Economic Strategy Directorate

Executive summary

The Equality Act 2010 places a duty (known as the Public Sector Equality Duty, or PSED) on public authorities to have due regard to the need to eliminate discrimination, advance equality of opportunity, and promote good relations between people who share a protected characteristic and those who do not. The Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012 (Regulation 5) require public authorities to assess and review policies and practices against the three needs of the PSED.

Therefore, the Scottish Government has undertaken an overarching NSET equality impact assessment (EQIAs) as part of the process of developing the strategy and the policies that it contains. It should also be noted that, as part of this process, EQIAs were undertaken to impact assess each of the transformational Programmes of Action. These EQIAs have been published separately alongside the NSET Delivery Plans.

This EQIA aims to consider how a policy may impact, either positively or negatively, different sectors of the population in different ways. Where any negative impacts have been identified, we have sought to mitigate/eliminate these. We are also mindful that the equality duty is not just about negating or mitigating negative impacts, as we have a positive duty to promote equality. The development of this EQIA has been underpinned by equality legislation and covers the protected characteristics of: age, disability, gender reassignment, sex, pregnancy and maternity, race, religion or belief, and sexual orientation.^[169]

The vision of Scotland's National Strategy for Economic Transformation (NSET)^[170], published on 1 March 2022, is for Scotland to be a wellbeing economy, thriving across economic, social and environmental dimensions. The strategy sets out an ambition that Scotland's economy will significantly outperform the last decade, both in terms of economic performance and tackling structural economic inequalities.

The task of transforming our economy requires an equally radical transformation in the way we deliver results through the transformational Programmes of Action set out in NSET. Effective delivery is crucial to delivering the strategy's aims, and this must embed and pay due regard to the three needs of the PSED if the strategy is to achieve economic prosperity for all Scotland's people and places and have the intended positive impacts on people with protected characteristics.

While NSET's six Programmes are each subject to individual EQIAs, this EQIA aims to look at NSET through a more holistic lens to explore how the overall economic policy direction of the Scottish Government over the course of the next 10 years, as set out in NSET, might impact on people with protected characteristics. It further also examines the principles of safeguarding the implementation of NSET over the course of the next decade with respect to equality and the three needs of the PSED.

A number of NSET commitments under the six Programmes of Action have already been taken forward and are currently being developed and implemented. However, some are at early stages of development and, as implementation is taken forward and specific actions are identified, their respective EQIAs will continue to be updated in light of further evidence and engagement with stakeholders. This EQIA therefore sets out preliminary and indicative impacts of known commitments of NSET and, alongside further stakeholder engagement, will help inform decisions that are taken in the further development and implementation of NSET.

Examples of some of the NSET commitments and approaches that have been influenced by the data and evidence gathered as part of this EQIA process are:

• NSET's vision of creating a Wellbeing Economy: NSET's overarching vision for Scotland is to create a wellbeing economy - an economic system, within safe environmental limits, which serves and prioritises the collective wellbeing of current and future generations.
• Developing NSET Programme-level, and Project-level and/or Action-level EQIAs where relevant: this overarching NSET EQIA highlighted the need to develop Programme-level EQIAs for each of the six Programmes of Action, and, where relevant, also at Project and/or Action level of the respective Programmes.
• NSET Governance: in light of the data and evidence gathered as part of this EQIA process, it was essential to ensure that membership of the NSET Delivery Board is fully representative of the people of Scotland and has access to information from people with lived experience of having protected characteristics, including a gender balanced approach to membership, representation from minority ethnic communities and the third sector, and a voice for those in rural communities.
• NSET Annual Progress Reports and NSET Monitoring: equality considerations have guided our approach towards NSET evaluation and data collection. Data collected as part of the evaluation and annual progress report will be broken down by equality groups where possible. Additionally, equality stakeholders, including the Equality and Human Rights Budget Advisory Group, will be consulted as part of the ongoing evaluation and monitoring of NSET.
• NSET commitment to establish the Centre of Expertise for Equality and Human Rights: established in May 2022, the Centre of Expertise in Equality and Human Rights will offer a training programme for economic policy officials, to cover themes including the use of equality evidence and intersectionality in economic policy making; and options will be explored for partnership working with academic experts, stakeholder groups and people with lived experience, both to build the knowledge and understanding of officials in their policy-making work and to help improve the evidence base.
• EQIA Review and Revision: we will review and revise this EQIA on an annual basis in line with annual progress reports and in light of any new data and developing circumstances as NSET is implemented over its 10-year lifespan. This also applies to the NSET Programme-level EQIAs and more detailed EQIAs that will be carried out on specific NSET Projects and/or Actions in future.
• NSET prioritisation and spend: economic conditions can change rapidly. As we respond and adapt to changing circumstances over the next 10 years, we may need to prioritise and/or focus our attention on developing certain NSET commitments that can best provide support or mitigate potential shocks. In doing so, we will be mindful of the impact of our decisions, including decisions on spending, embedding equality and human rights within all stages of the Scottish Government's Budget process to ensure our spend advances equality and human rights for all of Scotland's people.

Through undertaking this EQIA, we have identified areas where there are potential direct and/or indirect impacts on different groups and where work can be taken forward to promote equality. This process has demonstrated that NSET delivery will advance equality of opportunity across all protected characteristics, and in particular for the following groups: age, disability, sex, pregnancy and maternity, and race. It is also anticipated that the delivery of NSET might have a positive impact on fostering good relations among and between people who share one or multiple protected characteristics and those who do not. We have found no evidence of negative impacts for people with protected characteristics at this time.

A summary of NSET commitments that are expected to have a positive impact on people with protected characteristics is set out below:

• Stimulate entrepreneurship by embedding first rate entrepreneurial learning across the education and skills systems;
• Create a world class entrepreneurial infrastructure on institutions and programmes to provide a high intensity pathways for high growth companies;
• Adapting the education and skills system to make it more agile and responsive to our economic needs and ambitions;
• Support and incentivise people, and their employers, to invest in skills and training throughout their lives;
• Expand Scotland's available labour pool, at all skills levels;
• Tackle poverty through fairer pay and conditions;
• Eradicate structural barriers to participating in the labour market; and
• Realise the different economic and community assets and strengths of Scotland's regions.

This EQIA has also highlighted areas where there is limited evidence concerning certain groups, in particular for religion or belief and gender reassignment, and also in relation to intersectionality. This will help inform our ongoing work to develop and strengthen the evidence base regarding equality and the economy, as well as intersectionality. This might be further supported by the Scottish Government Equality Data Improvement Programme (EDIP) and stakeholder engagement. Given gaps in evidence in relation to intersectionality, combined with the impacts of the current cost crisis on people with protected characteristics and low income households, further work will be required to build our understanding of the potential positive and negative impacts of delivery of NSET.

We will continue to proactively consider equality impacts throughout implementation of NSET, creating a prioritised work plan to ensure the Projects and Actions we have laid out are taken forward, with a focus on advancing equality. This approach will support the achievement of the overarching NSET vision of a wellbeing economy and is expected to be reflected over time through the National Performance Framework and the Wellbeing Economy Monitor.

Further equality impact assessments will be conducted as appropriate on specific policies that are developed to implement NSET so that human rights and equality are embedded in delivery of the strategy and to uphold the Scottish Government's obligations under the PSED.

We will publish an annual progress report for the NSET Delivery Board in order to enhance accountability, which will include equalities monitoring. As part of this, we will continue to monitor and engage with the emerging equality evidence as we finalise the content of the report and the common accountability framework with delivery partners.

This EQIA will be subject to further review and revision, including in light of developing evidence and circumstances as NSET is implemented over its 10-year lifespan. This may result in the need to adapt our policies to ensure we mitigate any direct or indirect negative impacts and deliver positive impacts on people with protected characteristics. We will also seek to improve equality data collection, including through EDIP and Programme 6, so that our consideration of the potential impacts of economic policy on people with protected characteristics is informed by a strong and evolving evidence base.

Background

In 2021, the SNP Manifesto^[171] made a commitment to delivering Scotland's National Strategy for Economic Transformation. In July 2021, the Scottish Government established an Advisory Council for Economic Transformation made up of business leaders, trade unions, academics and economists to help shape the strategy, which was published in March earlier this year.

In recognition of the breadth of direct and indirect impacts that delivery of NSET will have across all parts of society in all areas of Scotland, an extensive engagement programme has been undertaken with a broad range of stakeholders, including with equality and human rights stakeholders and through a semi-formal 9-week consultation that received over 260 responses. Building on the pre-publication consultation and stakeholder engagement, since the launch of NSET Ministers have undertaken an extensive programme of engagements, including roundtables, events, and boardroom meetings. In total they have engaged with more than 150 stakeholders across business, public and third sectors in small settings, as well as addressing hundreds more at events including at the Scotland House Vision for Trade Event, Unlocking Ambition showcase event, and the National Economic Forum. The pre-publication and post-publication stakeholder engagement has helped shape and inform NSET's vision and ambition, as well as the six transformational Programmes of Action and their Delivery Plans.

In addition, the NSET Evidence Paper^[172] set out evidence on the structure and performance of Scotland's economy, and identified areas for action to deliver transformational improvements in Scotland's economic performance. Evidence concerning economic inequalities and the experiences of people with different protected characteristics in relation to Scotland's economy was brought together in the NSET Equality Position Statement^[173].

A full summary of official and ministerial stakeholder engagement and evidence and data gathering which has shaped the development of NSET and this EQIA can be found in the NSET EQIA Record section of this document.

Scope of the EQIA

The scope of this EQIA is to consider the impact of NSET delivery on people with protected characteristics. The economy impacts everybody, regardless of their age, ethnicity, sex and other characteristics. Therefore, the implementation of NSET is expected to impact on everybody. The commitments under NSET are intended to support and drive Scotland's overall economic prosperity to the benefit of all our people. However, just as every person is an individual with particular characteristics and circumstances, their experiences of economic activity and the impacts that Scotland's economy has on their lives are different. Taking a person-centred, intersectional approach to considering the implementation of policies and actions can help to address entrenched inequalities and cumulative impacts on people, and particularly those who experience disadvantage.

This EQIA has been informed by detailed analysis of existing evidence and data (both qualitative and quantitative) in order to draw out the potential impacts that the delivery of NSET might have on people with protected characteristics as set out in the Equality Act 2010.

Specifically, this EQIA assesses the impacts of applying a proposed new or revised policy or practice against the needs relevant to a public authority's obligations under the Public Sector Equality Duty. The needs are to:

• Eliminate discrimination, harassment and victimisation;
• Advance equality of opportunity; and
• Foster good relations.

As well as the stakeholder engagement noted above, evidence and data on groups of people with protected characteristics have been gathered and analysed from a range of published national and UK research papers, reports, studies and surveys relating to income and earnings, poverty and child poverty, labour market and employment, and the COVID-19 pandemic. Statistics and data have been gathered from Scotland's Annual Population Survey 2020/21, NSET's Evidence Paper (2022) and Scottish Government Labour Market briefings. Research papers and publications such as If Not Now, When? by the Social Renewal Advisory Board (2021), UK Poverty 2020/21 by the Joseph Rowntree Foundation, and Tackling Child Poverty Delivery Plan progress reports have also been used to provide evidence.

The evidence-gathering exercise has highlighted areas where there is limited evidence on certain groups, in particular for religion or belief and gender reassignment, and also in relation to intersectionality, which we will seek to address through Project 18, EDIP and stakeholder engagement.

Key Findings

Through undertaking this overarching NSET EQIA, we have identified areas where there are potential direct and/or indirect impacts on different groups and where work can be taken forward to promote equality. This process has demonstrated that, in line with its overarching vision of a wellbeing economy, NSET is anticipated to advance equality of opportunity across all protected characteristics, and in particular for the following groups: age, disability, sex, pregnancy and maternity, and race. This will be done through effective delivery of NSET Programmes, Projects and Actions aimed at removing barriers to participation in the labour market and supporting Fair Work practices. It is also anticipated that delivery of NSET might have a positive impact on fostering good relations among and between people who share one or multiple protected characteristics and those who do not.

We have found no evidence of negative impacts for people with protected characteristics at this time, however we will keep this under review as part of the monitoring of this overarching EQIA, and as the commitments within NSET are developed further over the course of the next decade and will be subject to their own EQIAs. For example, there might potentially be a negative impact on relations within and/or between groups from targeting certain NSET actions.

This EQIA process has also highlighted a number areas where the principles of safeguarding the implementation of NSET with respect to equality and the three needs of the PSED will be of particular importance. These include NSET governance, NSET reporting and monitoring, NSET prioritisation and spend, and EQIA review and revision over the strategy's 10-year lifespan.

In addition, through undertaking this EQIA, we have identified some limitations in evidence and data on groups with protected characteristics in relation to the economy. This, in particular, applies to religion or belief and gender reassignment, and also to intersectionality. This EQIA has highlighted the need for more comprehensive and higher-quality evidence, as well as insight, to enable us to assess how policy decisions in the delivery of NSET are fair and are advancing equality of opportunity.

A full summary of the evidence and data gathering on protected characteristics, which has shaped the development of NSET, its Delivery Plans and this EQIA can be found in the Record section of this document.

Recommendations and Conclusion

The EQIA process did not identify indirect or direct discrimination through the policy intentions of NSET. It has shown that despite limited evidence for some protected characteristics, evidence for the wider context shows that the impact of NSET delivery will be positive and will advance equality of opportunity across all protected characteristics. In particular, this applies to the following groups: age, disability, sex, pregnancy and maternity, and race. For religion or belief, gender reassignment and intersectionality we have particularly limited data. We have found no evidence of negative consequences at this time; however, in line with best practice we will keep this under review as part of the monitoring of this EQIA.

Where limitations in data and evidence have been found we will seek to strengthen the evidence base. Project 18, Measure Success, under NSET Programme 6, will continue to work to improve data collection on protected characteristics, and consider how such data could link with other relevant publications such as the Wellbeing Economy Monitor. This work may also be supported by the Scottish Government EDIP programme and through further stakeholder engagement, including with the Equality and Human Rights Budget Advisory Group.

For some of the NSET commitments, specific policy interventions are either at early stages or are yet to be developed. As these develop they will require their own EQIAs, which should also be subject to periodic updates throughout the duration of the strategy to ensure that barriers for each protected characteristic are fully considered.

It is recommended that particular regard is paid to the principles of safeguarding the implementation of NSET with respect to equality and the three needs of the PSED in the following areas: NSET governance, NSET reporting and monitoring, NSET prioritisation and spend, and EQIA review and revision over the strategy's 10-year lifespan.

This EQIA will be kept under regular review, with new data and evidence analysed as we improve data collection to monitor the impact delivery of NSET is having on people with protected characteristics. The Programmes, Projects and Actions within NSET include both new and existing policies and commitments. This EQIA reflects the current position and in addition we will:

• Review and revise this EQIA on an annual basis in line with annual progress reports and in light of any new data or evidence and developing circumstances as NSET is implemented over its 10-year lifespan. This also applies to the NSET Programme-level EQIAs and more detailed EQIAs that will be carried out on specific NSET Projects and/or Actions in future; and
• Undertake EQIAs at an appropriate point in time when a proposed new or revised policy occurs during the 10 year lifecycle of NSET.