Policy Profile: Willie Rennie, Scottish Liberal Democrats

With a General Election called for 4 July, Insider is rounding up economic spokespeople from all the major political parties to quiz them on the policies that will potentially impact Scottish businesses.

To keep things objective, we’ve asked everyone the same set of questions.

For this edition, it’s the Scottish Liberal Democrats’ MSP for North East Fife, Willie Rennie.

• What is your position, party experience and business background?

I grew up in my father’s business, he was a shopkeeper with three grocery stores in Fife. It really consumes your life, but there was a sense of excitement during a busy day, when the local highland games were on for instance. I worked there on and off during my adolescence and saw what it took to start a business and work all hours.

I went to college in Paisley and studied biology, before getting my first job working for the party in Cornwall. I came back up and was chief executive of the Scottish party, before taking a break and working in the private sector as a PR consultant supporting charities and companies. Then I got back into politics in Westminster, before eventually becoming an MSP.

• What’s your assessment of the current Scottish business landscape?

My reading is that we’re still facing the Brexit and pandemic aftermath, there’s still a bit of wash through to come from businesses that just clung on with government grants and personal savings, but now the energy spike and trading changes are hitting them – sectors like retail and hospitality are being particularly hard hit. People are being put off by higher prices and just aren’t going out as much, so there are still some casualties to come – I see it every week on my patch.

I also think there’s a broken relationship between government and the business community, founders and owners just don’t trust them on taxation and regulation and the pace of change. You can argue the merits of individual pieces of legislation, but the cumulative affect of things like short term lets, rent control, the bottle return scheme – has just been too much.

• What does your party – if elected – plan to do to support Scottish businesses?

The first thing should just be a bit of boring pragmatic government, businesses are crying out for predictability, with an administration that doesn’t have to be interfering in every single aspect of economic landscape. So it’s important to make sure businesses understand the outlook, as they currently don’t have the time to understand what government is doing.

Then the things we need to sort out are skills gaps, our relationship with trading partners in Europe, a long term plan for renewable energy, settling down various bits of taxation and regulation, finishing the plan for rural broadband.

There also needs to be urgent reform of the Apprenticeship Levy, which must be more flexible, as the current levy doesn’t fit with that. Allied to that, we need to sort out the immigration system, finding the right skills for the right parts of job market – filling in gaps for roles like fruit pikers and social care workers.

• Within this, are there any key priorities to tackle first?

What I’ve just mentioned, the Apprenticeship Levy and sorting out skills landscape. Making sure funds raised from levy are more flexibly used, as it really needs to be about tomorrow’s needs.

Then just fixing the relationship with the EU, breaking down barriers, so that Scots can work freely across Europe, with a mutual recognition approach to that. It’s crucial that we make it easier for people to trade, even in small volumes – as currently the cost of transporting makes it not worth it, so SMEs are missing out on future prospects.

• And how will any major changes be paid for or legislated for?

We have some specific tax proposals: a windfall tax on oil and gas profits, proposing a tax on global internet giants to then invest in mental health provision, a proposal on buybacks in the trading market that is similar to what was introduced in the US. Ours is a fully-costed manifesto, with any big ticket tax rises all hypothecated. It’s all been carefully calibrated to make sure the plans won’t undermine working people, but with specific goals targeting areas of need.

• What is your party’s approach to North Sea oil and gas, and its transition to renewable energy?

The primary aim has got to be to reduce demand for fossil fuel energy within transport and housing – some progress has been made, but its slow and rather volatile. Secondly, we’re going to have to move away from North Sea oil and gas at some point. There’s some potential still in the UK Continental Shelf, but this has to be done via climate compatibility tests on each new extraction proposition. We’ve got to be mindful that there’s a danger if you don’t have sufficient activity within an area, the whole of the North Sea industry could collapse, as the infrastructure is co-dependent, so we must still be able to get the existing oil and gas off the rigs.

We’re not ‘no never’, but also not ‘yes to everything’. We don’t take the extreme positions, there’s got tot be a pragmatic way. Ultimately it’s about retraining and re-skilling, as we don’t want a cliff edge. There have been some technical problems with the proposed Skills Passport, so again there must be investment through the Apprenticeship Levy.

We must also maintain sufficient confidence in the renewables sector, which isn’t helped by issues with throughput of consents to proceed. The ScotWind programme is so large that there’s a glut of applications and questions around whether the authorities can process them quick enough. We’ve got to make sure there’s sufficient confidence and capacity, as that in turn brings investment in infrastructure and people.

• And are there any plans to encourage entrepreneurship, inward investment or scale-up growth?

What worries me most is on the university side, as there’s been a marked decline in the performance of research capacity within Scotland – it used to be 15% of UK Research Council funding coming up here, but that has dropped to 12.5% – partly due to our funding situation, but also in terms of reliance on international students. We’re doing a pretty good job in moving towards a better spin-out approach, but that needs to feed through to a proper pipeline, with the right advice and support, as well as finance to help with scaling up.

We need to keep those spin-out and start-up companies to stay domestically based, capturing the IP [intellectual property] within Scotland. That means having an enterprise setup that looks at the whole pipeline. Mark Logan’s doing a pretty good job, but detailed work is required to ensure confidence, skills and funding at the right time. A lot of this is to do with being able to hire the right people and the availability of flexible premises, as well as advice in terms of where they can trade with.

It’s not just about tax, it’s about the wider support mechanism. But we do need to change business rates, valuing land rather than just buildings. Then there’s the tax differential issue between England and Scotland at certain levels, as well as a wider behavioural change too, meaning people are not wanting to move north.

I’m not a low tax Tory, I’m for finding a balance, but value for money is just not there right now. Again, there’s been a loss of trust on tax policy, the SNP have been inconsistent on messaging – on one hand there are some progressive proposals, but on the other hand they’re freezing council tax.

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