Post-COVID economic advisory group advocates accelerated investment in housing

Post-COVID economic advisory group advocates accelerated investment in housing

Benny Higgins

The Scottish Government should accelerate investment in housing, in particular through the Scottish National Investment Bank, and introduce a Scottish jobs guarantee in partnership with business as part of its recovery from the coronavirus pandemic.

Led by ex-Tesco Bank boss Benny Higgins, the Advisory Group on Economic Recovery was tasked with recommending solutions to ensure transition towards a greener, net-zero and wellbeing economy, and to advise on measures to address different challenges the economy will face.

In a new report published today, the advisory group wrote: “Housing is central to the Scottish economy and to our wellbeing. The construction sector is a major source of employment, and makes an important contribution to Scotland’s GDP. In normal times, investment in social housing alone by the public and private sector runs at over £3bn a year. But more important than its direct impact on jobs and finances, everyone in Scotland should have a home that is warm, affordable and accessible. And support for housing is vital to help our most disadvantaged communities and create sustainable, attractive places. 

“Scotland faces a number of structural challenges, including caring for our ageing population and tackling homelessness, which have only been exacerbated by the crisis. Investment in housing has an important part to play in supporting Scotland’s recovery, in supporting jobs, creating confidence and contributing to both social policy and climate change goals.

“The Scottish Government should develop mechanisms to accelerate investment in housing, and in particular affordable housing, in rural as well as urban areas, using its policy and funding interventions to leverage private finance wherever possible. The Scottish National Investment Bank should play an important role in this effort, under its mission-oriented approach.”

The group’s 25 recommendations, which will now be considered in detail by the Scottish Government and its partners, include:

  • An urgent need to access low-cost debt requires an accelerated review of the Fiscal Framework, and a significant increase in access to capital investment to support an investment-led recovery
  • A Scottish jobs guarantee, in partnership between business and government, should be introduced to address unemployment, with refocused skills strategies and decisive steps to align teaching and learning in universities and colleges to the needs of business
  • Prioritisation of sector plans to deliver a green recovery, where the coincidence of emissions reductions, the development of natural capital and job creation are the strongest
  • Critical investment in the country’s digital infrastructure to improve connectivity, reduce inequalities and build the country’s resilience
  • Urgent action to develop a stronger relationship between business and government on the strategy for Scotland’s economic recovery

Economy secretary Fiona Hyslop has welcomed the recommendations.

She said: “Scotland, as with other countries, faces enormous challenges, and we need to all work together as never before to ensure our country emerges through this pandemic with a green economic recovery that has inclusion and wellbeing at its heart. We wanted the report to be ambitious and far-reaching, and with this strong and comprehensive set of recommendations this has certainly been achieved.

“The report identifies the importance of employment, the environment, education and equality. I agree that each one of these will be vital as we seek to create a society that is resilient, fair, and one in which everyone has the opportunity to be successful. We will now develop a detailed response to the report which will be published before the end of July.

“This report represents a clear call to action that goes beyond the Scottish Government and the public sector. We will only be able to build the kind of post-COVID-19 recovery we want with the active involvement of the private, cultural and third sectors and, importantly, the public. It is therefore vital that everyone continues to work together in the crucial weeks and months to come to deliver the action Scotland needs to recover from the impact of COVID-19.”

Benny Higgins added: “The Advisory Group on Economic Recovery has worked at great speed over the past two months, engaging extensively with businesses and with wider civic society to understand the challenges that we face, but crucially to curate a set of recommendations that emphasise the immediate need to protect and create jobs, reduce inequalities by building a green and technology-led recovery, and make Scotland an attractive place to do business.

“To create a robust, resilient wellbeing economy, the public and private sector must now build a new partnership to prioritise and deliver bold action. And they must do so with purpose and urgency.”

  • Read all of our articles relating to COVID-19 here.

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