Ministers told to look to policy as Scots firms lag behind UK

(FSB), who compiled the figures, calling on Holyrood ministers to “carefully consider” how its policies are impacting on local economies.

Economy secretary Derek Mackay said Scottish Government support for small business had seen Scotland recognised as the fifth most supportive business environment in the world, ahead of all other parts of the UK.

The FSB said between 2000 and 2018, Scotland’s population increased by 7.4 per cent and the UK’S population increased by 12.8 per cent, which could partially account for the disparity in business growth rates.

The group said this gap “underlined the case” for a future immigration system that meets Scotland’s needs.

The figures come just a week after it was revealed Scotland faced a near £1 billion black hole in its tax revenues in the first year after Holyrood took control of sweeping new financial powers.

The country had lower economic growth than the rest of the UK, which resulted in a £940 million shortfall in the expected tax take in 2017/18.

Andrew Mcrae, FSB’S policy chairman in Scotland, said: “There are 100,000 more Scottish businesses now than when the new Scottish Parliament first met in May 1999.

“These operators have started up in an environment where a decision made at Holyrood can have as much of an influence on a firm’s success as an announcement during the UK Budget.

“This means decision makers in Holyrood have to combine their ambitions for the country with an understanding of how their proposals will work in the real economy.

“While Uk-wide business growth figures are disproportionately influenced by London and the south-east, Scotland should aspire to drive up both start-up and business survival rates.

“Building the vibrant and successful Scotland we all want to see requires a flourishing private sector.

“But to grow our business community, we need a steady stream of people prepared to set up on their own.”