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Publication - Report

Scottish National Investment Bank: consultation report

Published: 28 Feb 2018
Chief Economist Directorate
Part of:

Analysis of the Scottish National Investment Bank consultation.

43 page PDF

481.6 kB

43 page PDF

481.6 kB

Scottish National Investment Bank: consultation report
7. The Bank and regional mandates (Question 4)

43 page PDF

481.6 kB

7. The Bank and regional mandates (Question 4)

This section analyses respondents' views regarding whether they believe that the Bank should have clear regional mandates throughout Scotland. Respondents were asked to consider, "Do you think that the Bank should have explicit regional mandates within Scotland, to address specific regional issues and/or to contribute towards greater regional economic cohesion?"

Respondents were asked to answer Yes/No and were also given the opportunity to provide the rationale for their chosen answer.

There were 367 responses to this question, 92% of the total, with 320 respondents opting to provide further narrative in the commentary box. Of those responses for which additional narrative was given, 278 (87%) were considered valid.

Should the Bank have explicit regional mandates?

Respondents were strongly in favour of regional mandates for the Bank.

Figure 3: Question 4 Responses
Figure 3: Question 4 Responses

Source: Consultation Hub

Support for regional mandates

82% of respondents noted that the Bank should have explicit regional mandates. This is for a variety of reasons. The primary reason cited by respondents was that a one size fits all approach is not appropriate for the diverse economic performance of Scotland's regions. Several respondents who expressed support for this also expressed the opinion that economic development is highly skewed to the Central Belt and Aberdeen, while rural areas struggle with multiple economic challenges, including deprivation, outward migration, availability of affordable housing, connectivity issues and lack of well-paid employment opportunities.

Many respondents therefore feel the Bank should offer support tailored to the needs of different regions. Specifically, many respondents including the South of Scotland Alliance, Zero Waste Scotland, Business for Scotland, Women's Enterprise Scotland and North Ayrshire Council, as well as a number of individuals noted that rural areas suffer from a chronic underinvestment and reduced levels of economic activity in comparison to urban areas. They believe it therefore makes sense to prioritise these low-growth regions and take into account the various differential rates of regional development across Scotland.

Some respondents suggested that if the Bank is able to provide long-term and low cost capital, then local authorities could act as intermediaries to public sector entities and private sector enterprises, who could in turn request loans for specific projects in their region. It was also proposed that the Bank should ultimately support a network of smaller banks that offer localised, bespoke support for businesses, social enterprises and community groups in specific areas. A network of smaller banks would ensure that outcomes are oriented towards the needs of people within a particular area.

Opposing views

18% of respondents did not support explicit regional mandates. Some respondents remarked that the Bank would be more successful in the early stages through having a national focus and that spreading its efforts too widely may lead to dilution of effectiveness. These advocates expressed the opinion that regional mandates should be established at a later stage once area-specific problems and solutions have been identified and experience of more successful areas can be used to inform the process and make it more efficient.

Additionally, some noted that regional mandates should never be put in place, primarily because investments should be based on a successful business case irrespective of region. Additionally, it was suggested that there are too many variables and uncertainties to earmark for specific regional initiatives, as well as there already being policies in place to address specific regional issues.


Respondents reported that the Bank should have a regional Scottish focus and seek to address economic imbalances witnessed across Scotland. Specifically, the Bank should embrace the rural economy and have the capacity to be able to direct support beyond cities and the 'central belt'.