Press & Policy

These priorities were first published in Scotland on Sunday, 25 October 2026 

Ahead of the UK Budget, Scottish Chambers of Commerce has written to the Chancellor of the Exchequer, setting out a 10-point plan to restore business confidence, unlock private investment and support economic growth. Our proposals reflect the growing pressures facing employers, from rising labour costs and taxation to barriers to investment and skills shortages. While recognising the challenges facing the public finances, we call on the UK Government to take bold action to reduce the cost of doing business and create the conditions for Scotland’s businesses to invest, recruit and grow.

Scottish Chambers of Commerce Chief Executive Charandeep Singh BEM wrote:

Dear Chancellor,

Budget 2026: Restoring the Conditions for Growth

On behalf of the Scottish Chambers of Commerce Network, representing more than 12,000 businesses across every sector and region of Scotland, I am writing ahead of your first Budget to urge you to back Scotland’s businesses and give them the tools needed to restore private sector confidence and deliver on your Government’s central ambition: to restore hope across the UK.

Scotland has no shortage of opportunities. Sectors like energy, technology, tourism, and food and drink underpin our economy and have the potential to drive transformational economic growth. But without the right conditions in place for businesses to make the most of them, they will remain just that: opportunities.

Our member research gives wider context to this point. Four in ten Scottish businesses reported falling confidence in the second quarter of 2026, while 75% continue to feel pressure from labour costs and 57% are concerned by taxation. We are clear-eyed on the pressure the fiscal backdrop poses to your decisions this Autumn, but would encourage you to be bold. Measures that unlock private investment and growth will, in turn strengthen the tax base that supports those finances.

As you finalise your Budget, we offer you the following 10-point plan to allow Scotland’s economy to reach its full potential.

1. Reduce Employer National Insurance Contributions
Increased Employer National Insurance Contributions have stifled businesses across the country since their introduction in 2024. Our members report the increase to the cost of employment has reduced the headroom available for recruitment, pay, training and investment. Earlier this year, a third of businesses told us the cost of doing business had forced them to introduce a hiring freeze, while almost half said they had delayed or cancelled investment in the face of increased cost pressures. We urge you to ease this burden and unlock jobs and investment across the country.

2. Energise the energy industry
Similarly, Scotland’s energy sector also requires greater certainty. In the face of a damaging Energy Profits Levy, oil and gas firms continue to support tens of thousands of skilled jobs, domestic supply chains and UK energy security. The same industrial base servicing the oil and gas industry will be essential to delivering the next generation of offshore wind, carbon capture, hydrogen, and low-carbon infrastructure.

Allowing Scotland’s hard-won engineering, fabrication, logistics and offshore expertise to weaken will make the energy transition harder, not easier. Your Budget must abolish the Energy Profits Levy (EPL) and replace it with a stable, proportionate and predictable fiscal regime that encourages investment while delivering a fair return for the Exchequer. Our position on the EPL is echoed across the Chamber Network, including by the British Chambers of Commerce and Aberdeen and Grampian Chamber of Commerce.

Government must also show urgency on the approval of Rosebank and Jackdaw. More than £3 billion has already been invested in the two projects, which are expected to support £28 billion of economic activity over their producing lifespan, alongside 3,500 jobs at peak construction and 125 apprenticeships. Their economic footprint stretches well beyond the North Sea itself, supporting ports, manufacturers, engineers and supply-chain businesses across Scotland.

3. Strengthen the competitiveness of hospitality and tourism
More broadly, we ask for your Budget to go further in reducing the cost of doing business for hospitality and tourism, including through a reduction in VAT for the sector. Interest in Scotland as a tourist destination is heightened currently following exposure this summer during the likes of the World Cup and the Commonwealth Games in Glasgow, however many operators in these sectors are struggling to take advantage of this opportunity. A targeted VAT reduction would support demand, improve competitiveness and create greater space for investment.

The UK must also ensure its tax treatment of international visitors and travel remains competitive with other major destinations. Restoring tax free shopping for overseas visitors would help Scotland and the wider UK compete more effectively with European and international destinations for visitors and spending.

4. Raise the spirits of the Scotch whisky sector
The tax system should support industries in which Scotland and the UK have a genuine global advantage. Scotch whisky is one of Britain’s most successful exports, supporting jobs and extensive supply chains while generating billions of pounds in overseas sales. Yet the sector continues to face a disproportionately high domestic tax burden. We would urge you to cut spirits duty and provide a more stable long term alcohol duty framework, giving producers greater confidence to invest and compete internationally.

5. Invest in expanding driving test capacity
Pressure on household incomes, housing costs and access to transport all make it harder for young people to take their first step into work. Government should focus on the practical barriers and giving more young people a credible route into employment, training and careers with prospects for progression. For many young people, especially in rural and less well-connected communities, transport is one of those barriers. We welcome initiatives that support youth mobility, including free bus travel, but this must be matched by action to improve access to a driving licence.

Recent figures show learners in Forfar, Callander and Arbroath facing waits of around six to seven months for a practical driving test. We urge the UK Government to increase driving-test capacity and reduce waiting times, alongside wider investment in the transport and digital connectivity that allows young people to access jobs wherever they live. This should form part of a more ambitious effort to reduce the number of young people not in education, employment or training and provide clearer pathways from education into the workplace.

6. Give regions a stronger role in driving growth
Economic growth will not be delivered through a one-size-fits-all approach. Scotland’s regions have different economic strengths, labour markets, infrastructure needs, and opportunities for investment. Policy must reflect that diversity. The UK Government should work with the Scottish Government, local government, the Chamber Network and other regional partners to ensure decisions on investment, infrastructure, skills and economic development are informed by the places they affect.
Business must have a meaningful role in shaping regional growth priorities, with stronger coordination between national policy and local delivery. Giving regions greater influence over the economic decisions that affect them will help ensure investment is better targeted and opportunities are not held back by a centralised approach.

7. Incentivise careers in key sectors
The UK must take a more innovative approach to tackling the brain drain, not just from remote and rural areas but increasingly from our cities and towns. Projections from National Records of Scotland show that the number of young adults aged 16 – 29 is expected to fall by more than 157,000 over the next 25 years.

Your Government should work with the Scottish Government to explore and pilot a tailored tax incentive for young people entering sectors experiencing acute skills shortages after completing education or training in Scotland. Doing so would give young people greater breathing room to build a career and get a foot on the property ladder, while helping ensure that skills nurtured in Scotland’s world-leading colleges
and universities remain here and contribute to our economy.

8. Introduce a Digital Skills Guarantee
Artificial Intelligence presents one of the clearest opportunities to raise productivity across the economy. Scotland already has significant strengths in technology and innovation, but the real economic prize will come from enabling businesses in every
sector to adopt and benefit from these technologies. For many SMEs, the barriers are practical rather than technological: a lack of time,
skills and confidence about where investment will make the biggest difference. Your Budget should introduce a Digital Skills Guarantee, giving businesses access to flexible, employer-led training in AI and other productivity-enhancing technologies, alongside practical support that helps SMEs adopt them.

As AI accelerates, Government must also strengthen cyber resilience. Businesses will only embrace new technology at scale if they have confidence that the systems, skills and digital infrastructure underpinning that investment are secure.

9. Support exporting SMEs
Government should do more to showcase the best of British business on the world stage, helping firms turn new trade agreements into commercial opportunities and ensuring export-ready businesses have access to the advice, networks and finance
they need to compete.

We welcome the expansion of UK Export Finance, but increased capacity must translate into support that SMEs can access quickly and practically, including working-capital finance and guarantees that allow businesses to fulfil international orders and scale into new markets.

10. Back Heathrow Airport expansion
We support the expansion of Heathrow and urge your Government to move at pace, while safeguarding and strengthening Scotland’s connections to the UK’s principal international hub. Backing British SMEs at home and helping them win overseas
should be two sides of the same growth strategy.

Chancellor, businesses understand the difficult choices facing government. But fiscal stability and economic growth cannot be treated as competing objectives. A stronger private sector – investing more, employing more people and selling more to the world – is ultimately what will generate the revenues required to sustain our public finances.

Scotland has the businesses, skills and assets to make a greater contribution to that growth. Your first Budget is an opportunity to give them the confidence and tools to do so.

We urge you to take it.

Yours sincerely,
Charandeep Singh BEM
Chief Executive
Scottish Chambers of Commerce