As an economist, the 2026 Holyrood election campaign was even more frustrating to watch than the 2024 UK election. As in the 2024 UK election Scotland went into this campaign with some well-founded warnings from various economists, think tanks, and from the RSE, Scotland’s National Academy. Even before the campaign began the economic and fiscal picture facing the next Parliament was clear: the most recent Scottish Government Medium Term Financial Strategy estimated that by 2029-30 the incoming administration will face a fiscal gap of around £4.8billion. This draws on forecasts from the independent Scottish Fiscal Commission (SFC). The next Scottish Parliament will inherit the tightest public finances since devolution.
The curious issue is that all the political parties recognise that Scotland’s relatively poor growth performance is a major factor behind that fiscal constraint. The University of Glasgow’s Centre for Public Policy’s grid of the 2026 election manifestos shows this clearly. The manifestos focus on different political approaches to economic growth but, except for the Scottish Greens, all regard growth as a central element of their approach to the economy. Ultimately all the parties see growth as central to improving public services and addressing other socioeconomic problems in Scotland.
It is also striking that that there is considerable agreement on the causes of slow growth since the Great Financial Crisis in the UK and Scotland. The UK has underperformed many OECD economies in terms of growth since 2007-08, and Scotland has performed more poorly than the UK as a whole (albeit with some variability over time).
Our productivity challenge has been well documented in research by the Productivity Institute. It highlights persistent weaknesses in investment, business performance including diffusion of R&D, skills gaps and regional disparities. Last year I was asked by one of Scotland’s political parties to write an independent report on how Scotland’s regional economies can improve their performance relative to some of the UK’s best performing regions, drawing on existing economics research.
Across party lines, there is now broad acceptance of this problem. Even where parties differ on policy solutions, most acknowledge on the diagnosis of what causes slow growth. Given that the SNP will not have a majority in the new Parliament, can it build cross-party co-operation to tackle the issue? For an incoming SNP administration, this creates an opportunity: growth can be framed as a shared constraint, rather than a partisan agenda.
The SNP’s manifesto already moves in this direction. It emphasises a “growing economy” alongside measures to support business scaling and workforce development, including a High Growth Unit and more apprenticeships.
But crucially, it also builds on an existing architecture of regional economic partnerships, sectoral clusters and community wealth-building initiatives. These points resonate across Holyrood beyond the SNP’s winning manifesto. Labour, the Liberal Democrats and even the Conservatives all support, in different ways, regional approaches to development and stronger local economies. This creates a key political opening. By framing economic strategy around regional opportunity and local strengths, an SNP government can position growth policy as practical and inclusive – rather than ideological. That increases the scope for cross-party consensus.
One of the most important points in my report on regional economic development is the need to focus on delivery. The complexity of the problems involved requires co-ordination in policy delivery across government departments, combined with greater empowerment and strengthening of regional economic partnerships. In terms of the machinery of government, I suggested a more effective co-ordination at Cabinet level ideally co-ordinated by the First Minister. This reflects similar approaches on driving productivity in other OECD countries.
One of the clearest areas of overlap across parties – and between the SNP manifesto and independent analysis – is the need to better align skills, infrastructure and investment. The SNP’s commitment to deliver 150,000 apprenticeships during this Parliament and closer links between education and industry reflects this priority.
Similarly, infrastructure and planning have emerged as major constraints on productivity. Evidence shows that Scotland’s planning system continues to face delays, with major applications often taking significantly longer than statutory targets and housing developments particularly affected. Infrastructure delivery has also been slowed by cost pressures, labour shortages and supply chain difficulties.
One of the areas with the greatest potential is the need for different city regions/regional economic partnerships in Scotland to collaborate more, in order to compete more effectively. In this regard, the proposal in the SNP manifesto that one can develop a “Glasgow Edinburgh Arc” and an “East Coast Arc” to cluster innovation and investment reflect the recommendations in my report. Effective multi-level governance in industrial and regional policy will also require closer collaboration in public investment between governments in the UK and Scotland.
Place-based economic policy offers one of the best opportunities to tackle the economic growth challenge in Scotland. But by its very nature that will require co-operation across parties at a time of greatest political fragmentation, which is difficult. However, if this does not happen, the dog that didn’t bark at the 2026 election could come back to bite the new administration.
