Scotland “Has All The Ingredients But Lacks A Recipe” For Growth: Report

Study launched ahead of major economy conference hosted by Gordon Brown next week

Scotland has all the ingredients needed to become one of the great European engines of innovation – but it needs governments to come up with “a recipe for action,” a new report published today by Our Scottish Future concludes.

The report – “Engine of the North: Making Scotland a European Innovation Leader” – finds that Scotland has all the building blocks to once again become one of the most innovative nations in Europe.

But the paper argues the while Scotland has all the ingredients required for innovation, “it lacks a recipe.”

In a call to help ‘left behind’ parts of Scotland, it says that boosting innovation in the poorest performing areas of Scotland to the same level as our best could add £4billion to the Scottish economy overnight.

Boosting innovation in the poorest performing areas of Scotland to the same level as our best could add £4billion to the Scottish economy overnight.

The report comes ahead of a conference on the Glasgow economy next Friday, February 10th.

Speakers including Gordon Brown, CBI director-general Tony Danker and Centre for Cities founder Lord Sainsbury will set out ideas on how to boost growth in Scotland’s largest city region.

Scotland has enviable resources to produce an highly innovative economy, including a strong University sector, more STEM graduates per head of population than anywhere else in the UK, and high levels of state R+D funding, today’s report says.

However, despite this, it finds that our outputs are disappointing: Scotland has the third lowest GDP growth in the UK behind Northern Ireland and the North East of England, fewer new businesses being created each year per head of population than every region in England expect the North East, and has only 1.5 high growth firms per 10,000 head of population– half the number in London.

Among its recommendations, it argues that Scotland should connect up more closely with the rest of the UK to leverage the financial muscle of London and the “golden triangle” of London, Oxford and Cambridge.

The paper is written by engineers Chris Bond and Will Sutton, who have spent a lifetime working on innovation in Scotland’s offshore industries, and OSF research director Jamie Gollings. 

They conclude: “Scotland has one of the strongest sets of innovation enablers in the UK. Scotland would be expected to be a real leader in driving innovation in the UK. What’s going wrong? The ingredients are there, but the meal is disappointing. The answer is the lack of a good recipe.”

The report points to Denmark – where government has drawn up a focussed R+D funding plan, and created innovation networks – as an exemplar.

“Scotland can be that country too. But to get there, it needs a state which is specific about what it wants to achieve, and unafraid to be bold,” the report says.

The report sets out a series of ‘top down’ and ‘bottom up’ recommendations which, if implemented, would drive innovation into every part of Scottish life.

‘Top-down’, it says government must focus its funding on a smaller group of high growth sectors, connect up better with UK bodies, and devolve power down to city and regional bodies.

‘Bottom-up’, it urges Ministers to say every town and region in the country should have new Innovation Forums to bring innovators, academics and local businesses together to come up with ideas to drive up productivity.

In Scotland, we’ve got no shortage of intellect or creativity, and no lack of opportunities and problems to apply this to. By making clear choices, directing the state’s help effectively, and creating the forums for these meetings to take place, Scotland can live up to its potential as an innovation nation once more.

The report shows that productivity is highly uneven – Edinburgh is one of the most productive areas in the UK, while southern Scotland lags way behind.

The report therefore backs a network of specialist Innovation Forums to support rural areas and small firms to find incremental gains in their way of working. To drive “bottom up” innovation, it says these should be run locally and not centralised in Edinburgh.

At a national level, it says the Scottish Government is “lacking a plan that dares to make choices.”

It urges Ministers to “take bets on a small subset of industries and then give them the backing they need.” It identifies those sectors as renewables, the energy sector, life sciences, business services, and food and drink and says the Scottish National Investment Bank should be more focussed in its support for these sectors.

The report also supports of the creation of Innovation Modules in every university degree – so students can learn how to identify problems and turn ideas into profitable concerns. Fostering a new culture of entrepreneurialism in Scotland is vital, it says.

It concludes: “In Scotland, we’ve got no shortage of intellect or creativity, and no lack of opportunities and problems to apply this to. By making clear choices, directing the state’s help effectively, and creating the forums for these meetings to take place, Scotland can live up to its potential as an innovation nation once more.”

To sign up to attend next week’s Glasgow economy conference, register here.