FSB calls for Scottish business Brexit fund

The Scottish Government should set aside £75 million to help firms adapt to the UK leaving the European Union, the Federation of Small Businesses (FSB) has urged Ministers.

Ahead of the draft Scottish Budget being unveiled on December 12, the FSB says it has urged Finance Secretary Derek Mackay to establish a new Brexit resilience fund. In a letter to Ministers, the small business campaign group also calls for further reforms of the business rates system, as well as action to boost town centres and high streets.

Andrew McRae, FSB’s Scotland policy chair, said: “Our research shows that only a minority of Scottish businesses have started to prepare for Brexit. While few would blame firms when they still don’t know exactly what they’re preparing for, we can’t see good businesses overwhelmed by a rapidly changing trading environment.

“Earlier this year, the Welsh Government announced a £50m EU Transition Fund. We’ve been impressed by Scotland’s economic agencies’ response so far, but after 29 March the work is really going to need to ramp up. At this budget the Finance Secretary needs to put aside funds to help businesses - across all sectors and geographies – adapt.”

FSB’s submission also details a request for the development of a new town centre diversification fund, which would be used to upgrade high street properties and infrastructure.

Andrew McRae said: “The high street is known as the home of independent retail. But if we’re to turn around some of our town centres, we need to make them attractive to the next-generation of businesses. We want the Scottish Government to build on the success of its town centre regeneration fund with a new high street diversification programme.”

The business membership group also lays out proposals for additional changes to the Scottish rates system – including a new taper on the Scottish Government’s small business rates relief scheme, to smooth out financial shocks to businesses who suddenly find themselves outside the scheme’s scope. The FSB also calls for cash to help with modernising the administration of the tax.

Andrew McRae said: “Following the Barclay review of business rates, the Scottish Government has developed a bold action plan to modernise this outmoded property tax. Ministers must assign appropriate funding to make this change happen.

“Further, we’re making the case to Ministers for a tweak to their landmark Small Business Bonus scheme, so that businesses outside the scope of full relief get extra help. This simple move could reduce the total volume of rates appeals, relieving pressure on the wider tax system.”

On the Brexit negotiations Andrew McRae said: “The top priority for Scottish businesses is securing a deal, avoiding a chaotic no-deal, no-transition Brexit. But the fact we need a deal doesn’t mean that Scottish firms welcome every dot and comma in the current proposals.