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New fund for digital skills training and other Scottish budget news

Last week, Cabinet Secretary Derek Mackay presented the Scottish Government’s budget for 2019-20 with news about taxes and public spending. We would like to give you a quick overview of the key announcements that are relevant for Scotland’s digital technologies industry and what they could mean for your business.

Digital Start Fund

A new £1 million fund to help those on low incomes benefit from digital skills training has been announced. This is a new instrument to address the skills shortage in our sector and open up opportunities in the digital economy to a wider range of people. Scottish Government plans to spend £1m per year to provide up to 150 people on very low or no income with grants to retrain and find a job in the digital economy. This is a welcome response to ScotlandIS’ calls for a greater emphasis on re-skilling and up-skilling of our existing workforce to address the digital skills gap as provision through traditional education routes isn’t sufficient.

If you would like to improve the digital skills of any current staff, the Digital Development Loan from Scottish Government is worth considering. It offers between £5,000 and £50,000 to SMEs (at 0% interest to be repaid over a maximum of 5 years) to improve digital capabilities and processes in areas such as cyber security, data analytics and software engineering. Details are available here:

Export and internationalisation support

During the budget year 2019-20, Scottish Government will spend £5m on directly supporting businesses to start exporting or increase their international sales. This is part of a £20m exports plan announced in the last Programme for Government. A detailed action plan will be published by spring 2019 and the ScotlandIS team has already met with Scottish Government officials to provide input from the digital technologies sector for the development of this plan.

Scottish National Investment Bank

An additional £120m in 2019-20 will be invested into pre-cursors to the Scottish National Investment Bank (SNIB) which is supposed to launch in 2020. This is supposed to ensure that the SNIB can become effective from the outset. The bank will focus on providing long-term patient capital which help power innovation and accelerate the transition to the low carbon, high-tech, connected, globally competitive and inclusive economy Scottish Government is aiming for. Given the considerable need in our industry for long-term investment, ScotlandIS will update you on future developments regarding the SNIB and ways to benefit from their investments, once this information will be available.  

Business rates

Scottish Government announced that they plan to cap the increase in the business rates poundage at below inflation level of 49 pence which limits the increase to 2.1%.  They also intent to introduce an extended relief of 100 per cent on all broadband fibre lit on or after 1 April 2019 for a ten-year period (until 31 March 2029).

Growth deals

The budget also included a commitment to progress discussions with the UK Government on growth deals for the Ayrshires, Borderlands (Dumfries and Galloway, the Borders and neighbouring English counties), Moray, Argyll and Bute, Falkirk and the Islands. These deals usually include various actions and investments to support business growth which your company could benefit from if located in those areas.

What next?

As the SNP lost its majority with the last elections, the government needs the support of at least one opposition party to get this draft budget adopted. The Scottish Parliament is currently scrutinising the proposed budget and the vote on it is expected in February. We will keep you posted on developments and details on how to take advantage of the funds and initiatives announced.

The full budget document is available here: .

Please get in touch with our Research and Policy Manager Svea Miesch at if you have any questions or comments on this.

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