Follow us

Scotland’s fortnightly political & current affairs magazine

Subscribe

Subscribe to Holyrood
Comment: Economic recovery needs voice of entrepreneurial community to be heard at top level of government

Image credit: Creative Commons

Comment: Economic recovery needs voice of entrepreneurial community to be heard at top level of government

By Colin Mason, professor of entrepreneurship in the Adam Smith Business School at the University of Glasgow

The voices of the medical and public health communities have dominated the advice to both the Westminster and devolved governments on how to respond to the coronavirus crisis. The voice of the entrepreneurial community, in contrast, has been marginalised. This has had two consequences.

First, the trade-offs that governments have made in their decisions have been driven by the need to protect public health, which has been prioritised over the costs of shutting down much of the economy (and also social, educational and other health risks).  As Sweden shows, a different trade-off involving a lighter-touch approach to managing coronavirus has resulted in less damaging economic consequences and excess mortality levels that are lower than other European countries that have locked down.

Second, many of the initiatives to support businesses during the coronavirus crisis have been poorly designed and executed, arising from the lack of understanding within government of how business operates. In particular, a ‘one size fits all’ approach dominated with the result that many businesses were not eligible for support.

But the failure of the voice of the entrepreneurial community to be heard at the highest level of government is a long-term feature. 

The recent Higgins report on Scotland’s economic recovery has highlighted the concern of the private business sector that the Scottish Government “doesn’t care enough about them” and is not sufficiently supportive.

More generally, there is criticism that the Scottish Government has not been as supportive of small businesses, as is the case in England.

However, the Higgins report itself can be criticised for ignoring the role that entrepreneurial activity needs to play in economic recovery and how to support it. This can be attributed, at least in part, to the composition of its seven-member working group which did not include any entrepreneurs.

It is widely accepted that post-coronavirus economic recovery will be driven by entrepreneurs who start, grow and scale-up companies. There are numerous examples of great companies that were started in previous recessions. But this will be put at-risk if the policy environment is unsupportive. It is therefore essential that the voice of the entrepreneurial community is both heard and understood at the top level of government.

This is particularly the case in Scotland and the other devolved nations, which have exhibited a weaker entrepreneurial performance over a long period of time that is reflected in low business start-up rates and low proportions of high growth firms.

Both Scotland and the other devolved nations should therefore give serious consideration to following the example of the Australian states of Queensland and South Australia by establishing an Office of the Chief Entrepreneur (OCE).

Analogous the office of the Chief Scientific Officer, the OCE is headed by a successful entrepreneur (who receives no financial remuneration) and supported by an independent advisory board and its own staff. It has two key roles.

First, it is an advocate within government for the importance and contribution of entrepreneurship and provides strategic advice to shape supportive policies and remove impediments to business start-up and growth. As many governments and agencies impact on entrepreneurship, the ability of the OCE to work across the government policy process is critical.

Second, it drives the creation of an environment that is supportive of current and aspiring entrepreneurs to achieve their ideas and ambitions, recognising that the support needs to be diverse in terms of the types of assistance available and the organisations that deliver this support.

Critically, the objective is to create a business environment in which all competitive businesses can succeed: the OCE is agnostic in terms of sector, type of business and location.

Well-designed, supportive policies, based on a deep understanding of business, are required to enable entrepreneurs to drive economic recovery. This requires that the voice of the entrepreneurial community is heard at the top level of government and that this is turned into action. Creating an Office of the Chief Entrepreneur will ensure that this happens.

Stay in the know with our fortnightly magazine

Stay in the know with our fortnightly magazine

Subscribe

Popular reads
Back to top