Construction key to budget: Swinney

Sep 10 2012

Growing the construction industry will be a key theme of the next Scottish budget, according to the Finance Secretary.

The pledge by John Swinney comes on the day an economic progress report highlights concerns in the sector.

Mr Swinney is expected to set out his annual budget plan to MSPs at Holyrood next week.

He said: "The priorities and actions set out last September remain relevant and, as I prepare our budget for growth, I am actively exploring what more this Government can do to boost jobs and growth in the construction industry.

"Next week's budget will build on the foundations for long-term economic prosperity that we set out in 2007 and focuses our actions on six strategic priorities which will accelerate recovery, drive sustainable growth and develop a more resilient and adaptable economy."

The report noted "fragile" recovery in Scotland since 2009, with output falling in two successive quarters, effectively returning the country to recession. Decline was driven by continued contraction in the construction sector, where output is almost 17% below its pre-recession peak, says the Scottish Government report.

The economic stagnation comes as ministers grapple with shrinking public finances. Adjusted for inflation, the Scottish budget from Westminster is expected to fall by about 11% between 2010-11 and 2014-15, according to the report. Capital budgets, used for larger public infrastructure, will be reduced by 33% over the same period.

Looking ahead to next week's statement, Mr Swinney said he hopes to build on positive developments but added that independence would allow government to do more for the economy.

"Retaining Scotland's position as the most supportive environment for business in the UK is essential in ensuring that our ambitious, innovative companies can thrive and capitalise on opportunities in new international growth markets," he said.

"It is also important in retaining our strong track record for foreign direct investment. For the second consecutive year, Scotland was the top-performing location in the UK with almost 6,000 jobs created in 2011."