Meeting of the Parliament 20 November 2014
It is a great pleasure to speak in the debate. As we have heard, the food and drink industry is a huge part of Scotland’s economy, which generated £13.9 billion in 2012 and accounted for 13.2 per cent of Scotland’s total exports. The sector directly employs almost 118,000 people. With 2015 being Scotland’s year of food and drink there has never been a better time to work to promote Scotland’s quality and unique products around the world.
The industry is still growing and we must nurture and support it to capitalise on its opportunities. My speech will look at two aspects of the food and drink industry: the local benefit that it brings to Ayrshire and Arran and a few of the problems that SMEs face in growing their businesses in the sector.
From its farmers markets to its distilleries, Ayrshire and Arran is an excellent example of the food and drink choices on offer in Scotland. Food and drink constitutes around 16 per cent of total visitor spending and in 2013 tourists spent more than £133 million in the local area.
One example of good practice in the Ayrshire area is the collaboration between producers. For example, the Ayrshire food network helps businesses to work together on issues such as distribution, marketing and export for their mutual benefit.
Taste of Arran is a partnership that brings together 11 food and drink producers on the island, including makers of specialist cheese, crunchy Arran oaties and delicious dairy ice creams, and provides its members with a single point of contact for sales, marketing and distribution.
It can be prohibitively expensive for a small business to export on its own because of the costs of pallets and containers. Taste of Arran works collaboratively with its members by sharing containers and other costs, which keeps costs down and enables members’ goods to reach wider markets that they could not otherwise tap into.
When I spoke to Alistair Dobson from taste of Arran at the VisitScotland event last night, he said that for years he had been exporting from Arran to the mainland and that it made business sense to extend the principle behind taste of Arran to the rest of the UK and further afield. He also believed that its collaboration should be replicated across Scotland. In fact, a pilot is running now with around 20 SMEs, and early figures are encouraging.
I welcome the initiatives that the cabinet secretary mentioned today, but I am sure that many other small business could benefit from schemes like the Ayrshire food network and taste of Arran. However, companies have said to me that they would not know how to go about joining such schemes or who to contact to start the process. It would be beneficial if the Scottish Government could look into whether the Ayrshire and taste of Arran examples could be replicated across Scotland. If they were, we would enable many more small businesses to export their products and so help the Government reach its target of a 50 per cent increase in exports by 2017.
Another issue that came to my attention when the Economy, Energy and Tourism Committee held workshops in Perth recently was that there is a lack of collaboration between Government departments. That led to one company missing a massive opportunity to export its potatoes to Russia because the governmental process was too slow. We need to get better at supporting businesses by having more cohesiveness between the many Government departments that are involved in ensuring that our food and drink industry is able to produce its goods and transport them to a global market.
Although that example involved just one company, it begs the question, how many more missed opportunities have there been due to a lack of collaboration between Government departments? In that respect, I welcome John Swinney’s comments at the Economy, Energy and Tourism Committee during draft budget scrutiny last week, when he said that new initiatives will be launched to assist and support companies to export. I hope that the Government plans to streamline the process and make it quicker and easier for businesses to compete with competitors globally.
There is a logistics issue with exports, not only in terms of global connectivity but in terms of ensuring that, within Scotland, businesses can move their goods quickly and easily and that all the modes of transport link up effectively. That is a noticeable problem the further north we go in Scotland. I welcome the fact that Maureen Watt’s committee is carrying out an inquiry into freight and logistics.
When dealing with perishable foodstuffs, it is crucial that the food can be transported quickly and in bulk and that the haulage and freight industry has the proper infrastructure to deal with capacity. According to the Freight Transport Association, poor rail lines mean
“weight limits and speed limits that put them beyond economic use”,
and there are
“areas outwith the central belt which are lacking in capacity”.
Collaboration and connectivity are key to expanding our food and drink sector. If we wish to be world players in this industry, we need to focus on investing in our infrastructure and helping smaller businesses to expand into local and global markets. Finally, we need to work to make sure that the processes are clear cut, streamlined and joined up to stop any unnecessary delays to the trading process.