The first duty of any government is to protect its citizens. In the weeks since lockdown, the Scottish Government’s energies have rightly been focussed on supressing the coronavirus infection, treating those in need of medical care and protecting vulnerable people. As a result, Scotland is now seeing a sustained decline in infectious cases.
However, there’s been an economic price to pay – and very likely we will continue to pay this until there is a proven vaccine or treatment for COVID-19 since, until then, at least some measure of social distancing will need to remain in place. So there will be no quick return to pre-lockdown ‘normal’ for society or the economy. Three months on from the start of lockdown in the UK and the damage is already becoming clear, with job losses announced in a number of sectors which look likely to be followed by more.
We don’t know what the economic outlook looks like. Will the recovery be V-shaped, U-shaped or a Nike swoosh? How long will any recession last, and how deep will it run? What will it mean for key sectors of Scotland’s economy – for everything from higher education to oil & gas, whisky to tourism? What will this mean for Scotland’s micro-firms, for SMEs and for large businesses? What does recovery look like and can we ‘build back better’?
These are the toughest questions, to which there are no easy answers or instant solutions. Scotland had economic strengths and weaknesses going into the crisis. It’s likely that the weaknesses will be exacerbated by the crisis and that inequalities – health, income, education, gender, ethnicity and opportunity – will rise. We’ll need to retain and boost our strengths alongside the right policy and practical interventions to protect those hit by economic hardship. We’ll need to look to the future, understand where our economy is headed, and take decisions and make choices which shape or alter this direction to ensure we emerge with as strong an economy as possible that creates opportunities for everyone.
Grappling with this will be hard. We’ll need to learn from the past, develop ideas fit for today, and see them through all the way to effective delivery. In my sector, hospitality and tourism particularly concerns us. Pubs, bars, restaurants, hotels and visitor attractions provide jobs and careers in particular for many young people and for those who need flexible employment – and these are the people who show the world what a great place Scotland is, to live in, work in, study in and visit. What will happen if these businesses cannot survive what could well be three consecutive ‘economic’ winters? We need a strategy for the sector and for those who work in it, to see it re-emerge with vibrancy and ambition.
The extraordinary challenges we are being presented with across the board will require extraordinary solutions – no region, town or sector is unaffected. Unemployment is going to go up; GDP is going to go down; international commerce has fallen to its lowest levels in four years and is likely to continue to drop. I believe that, across Scotland, this calls for a new relationship between business, government and the not-for-profit sector. These challenges are bigger than any of us and none of us has the ability to find lasting solutions alone; but if we can harness our collective strengths we may actually be able to mitigate the impacts of the coronavirus, and by collaborating we may actually be able to ‘build back better’.
Even done well, this won’t be easy. It will take time and effort. It will require government to reach into the business community and encourage those who do not normally engage with government to do so. It will require business people to come forward and offer their skills and experience, even when they are flat-out keeping their heads above water and protecting employment. It will require the not-for-profit sector to reach out to new contacts in different ways, rethinking what they can do and inculcating a better, broader understanding of the critical role that they play. There will be different ways of cutting it, but government should act first and fast to create the space for this new kind of interaction; which could be sector by sector and/or issue by issue (and, on issues, skills tops the list). I believe that an open call for all hands on deck would be well-received, with a focus on what everyone can bring to the table and what can be delivered in the short and medium term.
If this pandemic is going to teach us something, the importance of the public, private and not-for-profit sectors genuinely working together in partnership would be a good place to start.
Karen Betts is Chief Executive of the Scotch Whisky Association