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SME POLICY FORUM SCOTLAND S EXPERIENCE Professor David Deakins Massey University – PowerPoint PPT presentation

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Title: SME%20POLICY%20FORUM


1
SME POLICY FORUM SCOTLANDS EXPERIENCE
Professor David Deakins Massey University
2
Contents
  • Key demographics
  • Policy issues
  • Enterprise policy in Scotland
  • Ethnic minority enterprise as a case example
  • Recent policy
  • Conclusions

3
Key Demographics
Population 5.06 m. 2001 Census, 5.41 m. 2009
Area 78,772 km2 Population density 64 per km2
Age Structure
4
Age Structure
5
Geographical Distribution
Population density by area (Persons per km2)
Source GROS 2006 locality estimates.
6
Ethnicity
All people White Indian Pakistani other S. Asian Chinese Other
5062011 4960334 15037 39970 16310 30360
100 97.99 0.30 0.79 0.32 0.60
Source Scottish Census GROS (www.scrol.gov.uk)
7
Key Economic Data

Birth rate 10.7 per 000
Death rate 11.0 per 000
Net migration rate 4.1 per 000
Population growth rate 0.4
Life expectancy M 74.2 F 79.3
GVA per head 19,152 (2007 est.)
Average gross weekly wage 461.8 (2008)
Top exports Food/drink/chemicals/wholesale/retail/tourism/bus services/manf.
Destination for exports EU/North America
No of businesses (2008) 154,840 registered 282,330 est. total
8
Size Distribution of Enterprises (2008)
Size Number Total Scottish Employment Turnover m
0-49 employees 276,325 780,510 63.1
50 to 249 employees 3,600 254, 930 27.9
250 or more employees 2,405 1,506,310 152,334
Source Scottish Government, ONS (IDBR)
9
Policy Issues Two Agencies
1. Scottish Enterprise (SE) regional
development agency covering Central Belt and
South of Scotland
2. Highlands and Islands Enterprise (HIE)
10
Scotlands Enterprise Support Agencies
Highlands and Islands Enterprise
Scottish Enterprise
11
Policy Issues
  • Low Business Birth Rate or entrepreneurial
    activity rates compared to rest of UK (c. 50 of
    rates in London, GEM 2008 TEA for Scotland 4.5,
    compared to 5.6 for UK)

12
Business Birth Rates UK Regions (2006)
Source Scottish Enterprise, BIS
13
Policy Issues
  • Low Business Birth Rate or entrepreneurial
    activity rates compared to rest of UK (c. 50 of
    rates in London, GEM 2008 TEA for Scotland 4.5,
    compared to 5.6 for UK)
  • Reliance on traditional, but declining
    manufacturing sectors, particularly in the
    Central Belt
  • Declining natural resources e.g., North Sea oil
    and gas
  • World class scientific research centres, but
    historically low rates of commercial spin-outs
  • Rural enterprise large rural areas in Highlands
    and Islands and in the South of Scotland

14
Scotlands Economic Performance
Low growth economy
For over 30 years, Scotland has suffered
because our economy has been locked into a low
growth economy Government Economic Strategy
(2009), Scottish Government
From 1975 to 2005, Scotlands annual average
growth in GDP was 1.8, compared to a UK average
of 2.3 over the same period. Innovation for
Scotland Report (2009), Scottish Government
15
Enterprise Policy in Scotland
The Business Birth Rate Strategy (SE) 1993-2003
Commercialisation Strategy (SE) 1995 ---
Business networks (SE and HIE)
Entrepreneurial Exchange LINC Scotland
Volume v targeted support (HIE v SE)
Enterprise Education programme Determined to
Succeed
Womens Enterprise (SE and HIE) National Unit
for Womens Enterprise 2005--
16
Ethnic Minority Enterprise as a Case Example
  • Scottish Government commissioned national
    scoping study 2005
  • Methodology
  • Demographics guided research
  • Map MEBs geographical and sectoral distribution
    in Scotland compared to a white control group

17
Self-Employment Rates for all Scotland (Per Cent)

Source 2001 Census Analysis General Register
Office for Scotland
18
Self-Employment Rates for Glasgow (Per Cent)
Source 2001 Census Analysis General Register
Office for Scotland
19
Self-Employment Rates for Edinburgh (Per Cent)
Source 2001 Census Analysis General Register
Office for Scotland
20
Self-Employment Rates for Highland Scotland
including Western Isles and Orkney Shetland
(Per Cent)
Source 2001 Census Analysis General Register
Office for Scotland
21
Selected Key Findings
  • Strength and diversity of ethnic minority
    enterprise in Scotland , 4,500 businesses
    contributed upwards 1 billion to GDP
  • Concentration by sector and location but key
    contribution outside cities in Central Belt and
    rural areas
  • Innovation and resourcefulness of MEB owners
  • Diversity a source of creativity and innovation

22
Selected Key Findings
  • Low access to formal sources of finance
  • Lack of trusted intermediaries between banks and
    MEB communities
  • Lack of engagement with formal mainstream
    sources of advice and support and a low take-up
    of training. This includes
  • -----------lack of awareness
  • -----------strategies to avoid engagement
  • Requires strategies to build trust

23
Policy Response
  • SE and HIE Strategy to engage with ethnic
    minority businesses
  • -----engage with communities
  • ------support for access to finance
  • ------ethnic media and communication
  • Scottish Institute for Minority Enterprise
    owned and driven by ethnic minority business
    owners

24
Recent Policy
  • Removing barriers
  • Scottish Co-investment Fund
  • Scottish Seed Fund
  • Scottish Venture Fund
  • Supporting Innovation (RD Grants, Innovation
    Vouchers)
  • Innovation Strategy, June 2009

25
Supporting Growth Firms
  • Standard business support through Business
    Gateway (now devolved from Scottish Enterprise to
    the local authorities/councils)
  • Targeted support for growth firms by SE (but
    less so by HIE due to rural environment)

SE criteria (2009) - 5m valuation by end of
year 3, - commitment to trade globally, -
passion to succeed
26
Conclusions
  • Frequent changes in policy lack of consistency
  • SMEs have raised awareness of enterprise
    agencies, but still dependent on support
    delivered now by local councils
  • Finance initiatives have been more successful,
    especially local micro-credit, LINC Scotland and
    Co-investment Fund
  • Gaps still exist KT in rural areas/ethnic
    minority support
  • Disparities in support, funding and investment
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