Walter Baxter / Galashiels Town Centre Redevelopment Works

As legislation is currently making its way through Parliament to establish a new South of Scotland Enterprise Agency, the STUC and the Jimmy Reid Foundation have published research on the South of Scotland economy. Francis Stuart introduces the research and highlights the key issues the agency must address.

Regional inequality in the UK is a well-recognised issue, with London and the South East hugely outperforming the rest of the UK. Many have emphasised that regional inequality was a driver of Brexit.

However, regional inequality is also a significant issue in Scotland. Areas such as the Borders and Dumfries and Galloway significantly underperform other parts of Scotland. That is part of the reason why the STUC commissioned the Jimmy Reid Foundation to undertake research into the South of Scotland economy.

Their research finds that the South of Scotland faces depopulation and falls in the working population, especially in rural and peripheral communities. Poverty and in-work poverty are high across the South of Scotland and higher costs of living exacerbate low incomes. There is a dependence on low paid employment, and continuing long-term decline in the previous dominant sectors of manufacturing, agriculture and public administration are forecast to continue for the next decade.

These challenges are why the STUC support the creation of a South of Scotland Enterprise Agency, as proposed in the new South of Scotland Enterprise Bill. However, for that agency to effectively address the challenges it must have Fair Work offering effective voice, opportunity, security, fulfilment and respect, at the core of the Agency’s aims and operations.

The Jimmy Reid Foundation research highlights that the most successful European Development Agencies are based on the inclusion of all social partners in development agencies and other governance structures, with workers recognised as essential partners in setting agendas and creating a better economy and society for all.

Ultimately, workers need to be at the heart of decisions taken about our economy. For too long, workers have been excluded from economic development strategies, plans and policies and the result has been a declining share of wages, increased inequality and the rise of in-work poverty.

If the new agency is serious about fair work and inclusive growth, it must have a trade union seat on the Board.

The new Agency has the opportunity to improve the South of Scotland economy and address regional imbalances within the Scottish economy. If it is to do so inclusively, it must put workers and trade unions at the heart of its approach.

To read the research in full, please click here.