ASSESSMENT OF THE EFFECTIVENESS OF INTERACTIONS
As previously discussed the vast majority of the public sector interactions with this key sector are in relation to financial services rather than business services. However, SG, SE, SDI and HIE key sector teams have now begun to consider how best to identify appropriate interventions in the Business Services Sector and SDS has appointed a Financial and Business Services Sector Manager. These Key Sector Teams will work to identify which sub sectors within the Business Services sector have the potential for growth or improvement in productivity with public sector intervention or where we can better leverage the existing linkages with financial services to the benefit of both industries and Scotland's economy.
- There is an effective partnership in place between the public sector and the industry in delivering the Strategy for the Financial Services Industry in Scotland over the last four years.
- This collaborative effort was initiated in the original group which developed and then published the Strategy in 2005. One of the recommendations of the Strategy Group was to set up FiSAB to ensure continued collaboration between the industry and the public sector.
- The work of FiSAB and FiSIG which is reported upon annually is not only extremely important in terms of delivering the aims of the strategy, but is itself used as part of the Scottish proposition used by e.g. SDI when attracting FDI from financial services organisations.
- In late 2008 the relationship between the SG and the financial services industry formed part of the presentation made to Lloyds TSB by the Scottish Government in making its case for retaining key corporate and decision making functions and jobs in Scotland following the proposed merger with HBOS.
- FiSAB produces a report of progress annually. The Annual Report 9 outlines a comprehensive list of achievements across the three strategic pillars; People, Profile, and Infrastructure.
- It also discusses progress on a number of indicators, such as employment, qualifications, contribution to GDP, and earnings, which provides a system of measurable outcomes to gauge the success of the industry. Achievement of these outcomes should also have a positive impact on helping the SG achieve the overall Purpose of increasing sustainable growth.
- On a day to day basis, having sector-specific teams within SG, SE, SDI and SDS has meant that close liaison and partnership working within the public sector has been easy to maintain.
- With close ties established between all four teams, a cohesive response to industry needs has been achieved. Representatives from all four teams are also now members of FiSIG which means that actions appropriate to individual teams are managed with joint working - providing industry colleagues with simplified (one-stop) access to the public sector. Examples which provide an indication of the effectiveness of interactions in the year ended April 2009 are:
Regional Selective Assistance
- RSA has proved a valuable asset in attracting new companies to Scotland and helping established companies remain in Scotland to develop and grow. For example, Esure Holdings Ltd announced in February 2009 that it would be expanding its operation in Glasgow. The project is being supported with an RSA grant of up to £1.1m and is expected to create 250 new jobs, although the company believes that up to 500 jobs could eventually be created. Also, Barclays Wealth Management's operation in Glasgow is being supported with a RSA grant of £4.2 million, a project that is expected to create some 500 new jobs and safeguarding at least 800 existing jobs.
· It is safe to say that SMART: Scotland has, to date, had less of an impact on financial services companies than RSA. Although no grant has been made direct to any of the big financial institutions, grant has been awarded to a number of companies involved in the development of new technologies designed specifically for businesses in the financial services sector. These include Scalar Technologies Ltd who are developing an anti-counterfeit optical monitoring system and Level E Ltd who are developing artificial intelligence-based technologies for multi asset portfolio management.
- SE's financial services key sector team and SDI's financial services team both actively support the work of FiSAB and the Strategy. They have very close links with both indigenous and inward investor organisations and have been working recently to improve opportunities for the supplier network.
- Until the recent re-focus of SE and the creation of SDS, SE officials took the lead on actions in relation to workforce development and attracting talent to the industry. SE officials now lead on working with SDS in taking this work forward and ensuring a focus on the needs of the financial services industry.
- SE and SDI activity to promote Scotland as a hugely successful financial services centre with a strong legacy and a significant competitive advantage has seen major investment by international companies directly and indirectly involved in financial services. Since February 2009 alone, esure announced the creation of 500 new jobs in Glasgow, Tesco Bank announced 200 new jobs at its new HQ in Edinburgh in March; in June Virgin Money announced plans to create 100 Jobs in Edinburgh; and in August Tesco Bank announced the creation of over 800 new jobs in Glasgow while Capita announced 300 jobs at its insurance contact centre in Stirling - consolidating Scotland's position as the best performing region in the UK and a leading region in Europe for attracting FDI for financial services.
Highlands and Islands Enterprise
- HIE's focus is business services and has close links with key companies in the region, in particular long-standing relationships with inward investors who play a critical role in the Highlands and Islands economy. Work with these companies recently has included supporting pilot homeworking activity with BT and Vertex, as well as team leader development work with the Call and Contact Association ( CCA) and the contact centre sector.
- HIE has an important partnership role with SE and SDI in promoting Scotland, drawing on related strengths in the outsourcing sector, and demonstrating real evidence of rural Scotland providing companies such as BT, Capgemini, Vertex, and their blue chip clients, with the benefits of access to a loyal and highly skilled workforce, excellent performance levels, and cost efficiencies from lower average rentals and equivalent salaries.
- Although the regulation of the financial services industry is reserved to the UK Government, FiSAB has continued to discuss regulatory matters. Most recently, and in direct reaction to the global financial services crisis, FiSAB has agreed that Scotland required direct linkages with the UK tripartite authorities ( HM Treasury, the Bank of England and the Financial Services Authority). Following various discussions, FiSAB has agreed to invite the Bank of England and the FSA to attend relevant FiSAB meetings. HM Treasury continues to provide an observer to FiSAB.
Email: Central Enquiries Unit, firstname.lastname@example.org
The Scottish Government
St Andrew’s House