Professor Benny Higgins and First Minister Nicola Sturgeon.

Special report by Bill Heaney

Professor Benny Higgins is a big guy with a heart to match. No one can ask “how would he know?” when it comes to the Scottish economy.

Higgins is a banker who has been around the block. He knows the score in regard to how people live in every sector of society – from the Barras to Balmoral.

It was good at last to see someone with his pedigree at the briefing room podium with First Minister Nicola Sturgeon as chairman of the advisory group on plans for Scotland’s economic recovery when the virus pandemic is over.

When journalists asked him to speculate about the new Armageddon, which would inevitably have led to dark, lurid headlines in tomorrow’s newspapers, football fan Benny booted the questions into Row Z in the St Andrew’s House stand.

And with some silky financial, media savvy footwork told reporters: “I don’t want to waste time talking about how bad it could be, I’d rather talk about how much we can recover and how quickly we can do it in a resilient fashion.”

Benny did the sums in his head in a flash, calculating what the Covid-19 crisis had cost Germany and worked out the percentages.

He pointed out that “at least £6bn is needed, but the current limit through the fiscal framework is £460m so there’s a long way to go from where we are to where we need to be.”

Now, at last the public know the financial consequences of the corona catastrophe without the confusion they have experienced so far. No obfuscation, no attempts to mislead or cover-up.

The information came straight from the horse’s mouth in the manner we have come to expect over the years from the son of a bookie with a betting shop down the Gallowgate.

As a banker, Benny has seen it all, including working with Fred ‘the Shred’ Goodwin at the Royal Bank of Scotland during the 2008 banking crisis.

He came out of that debacle with more than enough credit and credibility to be head-hunted by the new and emerging banks that sprung up afterwards, including Tesco Bank.

The First Minister looked content with Higgins at her side. It would be a good news day twice over for her since she had earlier reported that there had been no deaths linked to coronavirus in the previous 24 hours.

Content enough to hint that Scotland will not be far behind when it comes to England relaxing the 2m rule, which is expected to happen tomorrow or later in the week.

She emphasised – “I can’t emphasise enough though that we have to stick to the FACTS, the set of five new safety guidelines to get us where we want to be”.

These are:

Face coverings in enclosed spaces

Avoid crowded places

Clean hands and surfaces regularly

Two metre distancing; and

Self-isolate and book a test if you have symptoms.

Benny Higgins outlined that almost 700,000 jobs may be under threat in Scotland.

He added that “we have a duty of care” to the public and the steps outlined in the report he has drafted gave Scotland “the best chance of getting back to work”.

Mr Higgins explained that apprenticeships would be key to recovery as training often suffers in an economic downturn.

He encouraged the Scottish government to engage with and support businesses to take on apprentices.

A Scottish Jobs Guarantee Scheme, led by businesses, would create secure employment for two years for 16-25-year-olds and provide them with access to training.

He urged the Scottish government to respond to the report by the end of July, saying it will take “courage” to put in place the scale of interventions required.

“Young people aged between 16 and 25 are at risk of long-term scarring from the imminent recession.”

He argued that the “spine of the recovery must be green” and urges the government to quicken its pace in this regard, such as removing regulatory obstacles without lowering standards.

Digital learning programmes should be created and accelerated, including the R100 broadband rollout. He recommended investing in sub-sea cabling as Ireland had done and called for the creation of a data centre industry powered by renewable energy.

The former Tesco Bank CEO highlighted some of the 25 recommendations within his report.

He argued that Scotland must be able to stimulate its economy, but warned the current devolution arrangements limit what it can do directly.

Mr Higgins suggested that the £6bn tranche of money required to be borrowed should be deployed as part of a fiscal stimulus package and the lowering of VAT to 15% would make a difference.

He explained his report focused on three key themes: inequality, education and unemployment.

The virus crisis had highlighted the scale of inequality in Scotland and had even exacerbated it, while the “learning loss” for children must also be recognised.

The economic adviser warned of the “tsunami of unemployment” coming own the road, which would impact particularly heavily on young people.

He suggested it would be important for the Scottish government to work with the private sector and to identify those areas where Scotland can “reasonably aspire to be outstanding”.

Renewables, tourism and hospitality, food and drink, universities and colleges, life sciences, digital and the creative sectors would be a good starting point.

The economy should be ready for the next crisis, not the last one.

His report was a “call to action” for everyone, but especially those in positions of leadership in government and business.

The economy already faced a range of challenges before Covid-19, such as Brexit. The report suggested the economic recovery should be education led and Education Secretary John Swinney would talk about this in parliament tomorrow.

BBC Scotland’s Business and Economy Editor Douglas Fraser asked if the government would consider taking stakes in companies at risk but deemed of strategic importance.

The first minister replied that she was not ruling out intervention but would not be drawn on any specific companies at the moment.

She then gave examples of her government’s previous interventionist approach, saying the economic recovery would require inventive and creative thinking, but she added that all steps will be carried out “within the constraints of value for taxpayers’ money”.

The next question focused on how well the public complied with the beginning of phase 2 of the easing of lockdown.

It came from PA’s Tom Eden who also asked about stronger legal underpinning to the advice, bringing the police into it.

The first minister said she has not yet seen the figures from the weekend, and refused to commit that guidance needs to be put into law.

However, she added: “We will always keep that under review.”

Ms Sturgeon said her overall sense of the matter was that the vast majority of people are abiding by the rules, but she also sensed a frustration just to get over this.

Peter McMahon, of ITV Border, wanted to know if failure to heed the mandatory wearing of face coverings on public transport will be a police matter.

The FM said: “We will consider what compliance looks like. I would rather start from the position of people understanding the benefits of face coverings rather than focusing on potential penalties for not doing so.

“A decision will soon be made on whether or not face coverings will be necessary for all in shops as well.”

She warned that if we want to continue to go in the right direction and keep the virus level down “we’ve got to stick to the rules in place now”.

Tom Martin from the Daily Express asked if Mr Higgins agreed with communications guru former SNP MSP Andrew Wilson’s assessment in a specially commissioned report that Scotland’s recovery could be “the worst in the developed world”.

He also asked what greater flexibility in the fiscal framework is needed and what money or borrowing powers are required now.

Michael Blackley from the Daily Mail asked if the economic impact of Covid-19 would be reduced if the social distancing of 2m was reduced or scrapped altogether.

He also asked if UK PM if Boris Johnson went ahead tomorrow in moving away from the 2m distancing, would the Scottish government speed up its review.

Mr Higgins replied that there was a frustration in the way that question is asked, as there is a sense of a false binary outcome that 1m is right or 2m is right. Instead it’s much more complex than that.

However, he accepted that “we need to get kids back to school and people back to work. The economy will cause carnage in future if we don’t get that”.

Nicola Sturgeon told reporters that Scotland’s scientific advisory group is reviewing the physical distancing issue and will report on it by 2 July at the latest.

She stressed the need to be careful, but added: “We’re not going to be very far behind what happens, whatever the decision might be in the UK tomorrow.”

The Scottish Parliament will discuss Higgins Report on the economy tomorrow, Tuesday

The report argues that the spine of economic recovery must be green, but Alan Smith from Radio Clyde said the Green Party have already described proposals as not being “urgent enough”.

Mr Higgins said he is in favour of ‘targeted extension’ of furlough, and Ms Sturgeon conceded that the government would need “to ‘reset its relationship with business’.”

Her administration already had a good relationship with the private sector, but “there will always be tensions”.

She would “warmly embrace” advice from businesses on the best way forward, stating that any leader would be failing in their duty if they did not.

Asked if he would like to see the UK government extend its Job Retention Scheme, Benny Higgins said the emphasis should be on protecting jobs rather than paying benefits.

He added that there are areas of the Scottish economy that simply have to survive and that he would favour a “targeted extension of furlough”.

Nicola Sturgeon pointed out that the Higgins Report was published less than two hours previously, and asked for people to take time consider it properly.

It was suggested at one point that West Dunbartonshire Council was “getting ahead of itself” by publishing details of what would happen when the schools return.

After all, public health advice might look very different when pupils are due to return in August.

The FM said: “I don’t think they are. Planning for blended learning is a sensible position given the uncertainties over the pandemic

“We have to have contingencies if we have to move to a model that does not allow full-time schooling, but we have to get back to normal schooling as quickly as possible.”

FM Nicola Sturgeon said she hopes to provide more dates for easing out of lockdown later in the week, but she highlighted spikes in China and Germany and urges people to stick to the current rules.

The first minister pointed out that as we get out and about more it is even more important than ever that we follow the rules and guidelines – “That’s why the decisions all of us are taking now as individuals, more than ever, directly affect the health, the well-being and indeed the economic prosperity for all of us.”

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