Policy Research Media Morhamburn

When the SNP Government took office in 2007, the three pillars of its Economic Strategy could safely be summed up as (in no particular order) Financial Services, Life Sciences and Renewable Technology.

Whether it’s because the first of these legs has become a bit shoogley, it has been clear that government has chosen to add some more sectors to the mix for Scotland’s economic future.

One of these additions has been Scotland’s “creative industries”. Sadly for Scottish Opera, Scottish Ballet and their ilk, this is not really a sudden change of heart amongst politicians that somehow investment in theatre, music and dance will offer Scotland a quick route out of recession – though I am sure you could make the case if you wanted to. The “creative industries” that ministers have in mind are much more the people working in Scotland who have turned geekdom into millions with Grand Theft Auto who are sure to follow this global phenomenon with other computer games.

So the news in the Sunday Herald newspaper that Sir Gerry Robinson, the entrepreneur who was recently seen on TV handing out his own millions for stakes in breweries and furniture makers, is advising the Dublin government to target Scotland’s games industry will be sending shivers through the collective spines of the Scottish Government and Scottish Enterprise.

The problem is that Scotland’s games companies have generally managed to get where they are without much outside help. Not very many will feel any great commitment or loyalty to Scotland, while Scotland in its own right cannot offer a single tax break to match Dublin’s likely enticements. While Scotland’s enterprise people can offer a lot of practical help, you still have to pay your corporation tax on every penny of profit if you base your games company in Scotland – but not, it would seem, if you move it to Eire.

Scotland, and Dundee in particular which is at the heart of this sector, will have to fight hard to find ways to match the overtures of our Celtic cousins. We have seen it with other sectors including, ironically, Life Sciences, where the Republic of Ireland has made an offer that global companies have found hard to resist. Scotland’s record at competing with the Irish when they set their hearts on something isn’t great but, to use an analogy from outdoor sports – the playing field isn’t very level.

The question now is whether the UK Government, with the fiscal levers not accorded to Holyrood, will consider offering the sort of tax breaks to preserve what is in effect an indigenous Scottish industry- something  it has singularly failed to do in the past.