The First Minister unveiled his Programme for Government yesterday, as the Scottish Parliament returned from summer recess.
John Swinney sought to anchor his national policy and legislative programme to local needs across Scotland, saying that “we will always be alive to the realities of your day-to-day experience”, and arguing that “the people of Scotland have put their trust in this government, and we will deliver what we have promised”.
His most eye-catching pledges pledges, which will be partly implemented across nine bills, include:
- The replacement of 14 territorial health boards with two strategic health boards
- Measures to tackle violence against women and girls
- An enhanced response to tackle football-related disorder
- Breakfast clubs in all primary schools from August 2027
- Wider rollout of the £2 bus fare cap
There were also multiple sector-specific announcements, in the form of upcoming legislation, policy signals, or reassertion of manifesto commitments.
Housing
The housing sector was a big focus of the First Minister’s speech, with a commitment to deliver 110,000 affordable homes by 2032, with at least 70% available for social rent. The Year 1 legislative programme includes a bill to increase council tax bands on high-value residential properties, dubbed the ‘mansion tax’. Legislation will also seek to lower heating emissions and clean heating energy costs for 100,000 buildings and homes in Scotland, though it is not yet clear how aligned this bill will be to the draft previously published by the Government.
Legislative vehicles
- Council Tax (Scotland) Bill
- Buildings (Heating & Energy Performance) and Heat Networks (Scotland) Bill
What this means for the sector
The Cabinet Secretary for Housing and her team will now be prioritising preparatory work on these bills, including consultation and engagement. The council tax bill is a new commitment stemming from the SNP’s manifesto earlier this year, and, given its high public profile and link into Scotland’s broader tax environment, will be contentious. Stakeholders should seek to engage early, so as not to get lost in the noise that this proposal is likely to generate. The heat in buildings bill has been through the public and parliamentary mill already, having previously been shelved for imposing disproportionate costs on rural homeowners. Stakeholders should re-engage those parliamentarians that expressed interest in the earlier iteration of this legislation and prepare to educate new parliamentarians with rural constituencies on the policy landscape that new regulations must consider.
Consultation on planning and consenting reforms is committed to, while housing is named as a strategic sector for attracting private investment. Businesses should be primed to engage with Shirley-Ann Somerville, the Social Justice, Housing & Local Government Committee and relevant Directorates to position themselves as investors critical to the successful implementation of the Government’s housing strategy.
Energy
In his speech, the First Minister reiterated his party’s belief in the need for Scotland to have full control over energy powers, as he seeks to capitalise on Andy Burnham’s devolution agenda. He also repeated calls for the Energy Profits Levy to be scrapped, noting both the pressures and opportunities that the ‘just transition’ is placing on north-east Scotland.
Energy is also critical when it comes to data centre development this term. The Government has committed to publish a strategic approach to attracting and securing responsible green data centre investment in Scotland, with clear expectations around environmental sustainability, resource use, community benefit and the economic and strategic value these developments should deliver.
Linking all of this and more together will be a new Energy Strategy.
Legislative vehicles
- Budget Bill
- Buildings (Heating & Energy Performance) and Heat Networks (Scotland) Bill
What this means for the sector
With the UK Government expected to decide on whether to greenlight further drilling at Rosebank and Jackdaw imminently, Scotland’s energy sector will attract a lot of political attention in the coming weeks.
The SNP is trying to balance its climate-conscious left-leaning flank on the one hand, and the realities of attracting investment and energy security amidst geopolitical tension on the other. We recently partnered with YouGov to poll Scottish adults on their views on the SNP’s stance on oil and gas drilling, finding that a strong majority favoured either fast-tracked licensing or case-by-case licensing, as opposed to a blanket ban. The SNP’s presumption against new fossil fuel development softened earlier this year, but its more nuanced strategy will be put to the test shortly. Renewable energy firms should monitor the UK Government decision and the Scottish Government response very closely, as they will set the tone for the wider policy debate going forwards. The Government’s approach to the heat in buildings bill will be affected by this.
Our polling with YouGov also reinforced the importance of local community benefit, particularly the impact on local energy supply, when considering further data centre development. Investors must ensure their arguments and pitches are framed through this lens.
Like housing, energy is explicitly mentioned in the Programme as a strategic sector for attracting private investment. Businesses should be primed to engage with Stephen Flynn, the Economy, Tourism & Energy Committee and relevant Directorates to ensure they are seen by policymakers as critical players in supporting the Government to achieve its ambitious energy goals.
Public service reform
The Government will seek to give statutory backing to reform of the public service delivery landscape in support of the aims of the Public Service Reform Strategy. It wants to enable the restructuring of public bodies, including their possible merging and abolition, as well as the transfer of functions between core government and public bodies. Accompanying announcements around the merger of fourteen health boards into two, consolidation of various environmental bodies and changes to local councils and Transport Scotland indicate the direction of travel here.
The Government is committed to launching the ScotGov App in Autumn to enable citizens to engage with multiple services without having to use multiple logins and websites, as well as a ‘tell us once’ approach to digital services more broadly.
Legislative vehicles
- The Public Service Renewal (Scotland) Bill
What this means for the sector
With the appointment of Ivan McKee to the new post of Cabinet Secretary for Public Service Reform, the signal was clear. The Scottish Government will prioritise efficiencies in the public sector and service delivery to cut waste and duplication, demonstrate fiscal discipline and close the deficit. Some public sector stakeholders will change, so businesses should be alive to the need to establish new relationships. All businesses, regardless of their sector, should wherever possible emphasise how their policy proposals enhance efficiency and value for money when engaging political stakeholders.
Hospitality, tourism and FMCG
The First Minister committed £100 million annually for culture by 2028-29, as well as the expansion of opportunities for cultural participation, such as a youth culture pass. A last-provider fund to support the sustainability of the last-remaining shops and pubs in rural and island communities will be established. The Government is also committed to pursuing bespoke migration arrangements for Scotland, which the hospitality industry has long called for in response to Scotland’s unique demographic challenges.
Perhaps the most controversial proposal in the entire statement was that the Government will pursue the establishment of legal price ceilings on some essential food items in large supermarkets. The draft legislation does not confirm what the price cap will be, as Ministers will set it at a future date. A consultation has now been launched. The First Minister argues this policy will improve affordability for households facing cost of living pressures. However, it faces stiff opposition. Earlier this week, twenty-three organisations signed a joint letter to the First Minister arguing that a statutory cap simply displaces costs elsewhere in the supply chain, and there are also concerns that the bill will conflict directly with the UK Internal Market Act, which sought to prevent regulatory divergence across the UK following Brexit.
Legislative vehicle
- Food Prices (Scotland) Bill
What this means for the sector
The sector will welcome the SNP’s focus on further funding for culture, but further detail on where this money will be allocated is required. Hospitality businesses may also welcome support in rural areas, but they will be most interested in the Government’s commitment to consider the recommendations of an independent review on the valuation methodology applied to non-domestic property in the hospitality sector, including how rates reform could stimulate regeneration of high streets across Scotland. Arguments around business rates reform need to keep being made in the political arena, as this exploration work progresses. The industry has created a strong and impactful media narrative against the food price cap and should engage fully with the consultation that has now been launched. There is opportunity in the fact that a cap has still not been set, as well as in relation to its conflict with the UK Internal Market Act, given that many large supermarkets and their supply chains operate across the UK.
Political reaction
The Opposition parties were united in claiming that the First Minister had run out of new and impactful ideas. Reform leader Malcolm Offord said the Government was offering “the same old empty promises, just rebranded”, Scottish Labour’s Jackie Baillie said Holyrood had “heard many of these promises before” and even the Scottish Greens, who have previously been coalition partners to the SNP, said there was “a huge number of disappointments” in the Programme for Government.
With further debate taking place in the Chamber throughout the week, and the SNP set to host its Business Day in Edinburgh on Friday, much policy detail is still to be announced. Combined with ongoing change in Westminster, the next few months offers much opportunity as well as some risk to those seeking to influence public policy. That’s where we come in to help.
If you’d like to discuss what these developments mean for your organisation, please contact us here.