First Minister John Swinney has been told to cut regulations, speed up Scotland's planning system and work effectively with Sir Keir Starmer to allow businesses to "reach their potential" as he sets out how he proposes to boost economic growth as he unveils his programme for government tomorrow. 

The demand is among those being made ahead of his statement to Holyrood where he will explain in detail the policies he will pursue in the run up to the next Scottish Parliament election in May 2026.

Economic growth was listed by Mr Swinney as one of his four priorities for his period in office when he set out his vision to MSPs in May just after he became First Minister with the three others being eradicating child poverty, tackling the climate emergency and improving public services.

His programme for government will be announced a day after finance secretary Shona Robison sets out major cuts to public spending, reportedly worth £600 million.

Her reduction in spending will mean more efforts will be made to generate revenue to pay for frontline services by growing the economy which will in turn require a boost to business activity.

Colin Borland, Federation of Small Business director of devolved nations, told The Herald: “To kickstart economic growth, the Scottish Government needs to work with the business base we actually have here in Scotland.  

"That’s the 335,000 small and micro firms who make up 98% of enterprises north of the border, employing 900,000 people and turning over £82 billion annually. Our latest research shows almost half (47%) of those firms are aiming to grow their business in the next 12 months. That said, their overall confidence has slipped since the start of the year, amid concern about rising costs, potential tax increases and the cumulative impact of regulation.

“Taking meaningful steps to tackle the build-up of regulation would free Scotland’s small firms to realise their full potential. More than one in ten small business owners tell us they already spend over eight hours a week on regulatory compliance, time they could otherwise spend running and developing their business."

Reducing regulations on businesses - and not introducing any new curbs - were among the key asks among sectors.

David Melhuish, director of the Scottish Property Federation urged Mr Swinney to amend the Scottish Government plan to bring in rent controls in its Housing Bill. His organisation has claimed has put as much as £3.2 billion of investment is at risk because of uncertainty around the plans. 

"Investors need to see signs of improvement in the Housing Bill. The uncertainty the bill has caused is directly causing investment in build to rent housing to be redirected to England, or sites formerly earmarked for new rental homes now designated for other uses," he told The Herald.

"Recent Scottish construction activity for this new sector has also fallen by 54% in the past year while the bill has been debated.

"The scale of this loss of investment over summer alone is estimated by us to be in excess of half a billion – a devastating blow to the Scottish economy at a time that is effectively flatlining, while a further £290m at least was posted for sale leading to at least significant delay before those sites seek new investors. We need an early signal that the government needs to commit to amending the Bill to ensure that if we are to have a system of long-term rent controls, that these will be investible rent controls."

Mr Melhuish also urged Mr Swinney to speed up planning processes - a key ambition of the new Labour Government at Westminster.

"It is clear the new government in London means business in relation to planning reform. We need to see planning reform similarly prioritised and help to be a platform for investment in new homes, jobs and commercial developments in Scotland," he told The Herald.

"Our industry has always said it would be prepared to pay higher fees for a tangible improvement in performance. We have paid higher fees but the planning system continues to be a concern for the development industry. We need to see investment in planning resources not just in local authorities, but we must also align the agencies of government to support economic development if we are to see a genuine transformation in the planning services in Scotland."

Meanwhile, tourism bosses also called on Mr Swinney to "hold off on introducing any new regulations or burdens on business" including shelving plans for alcohol advertising restrictions.

"As the Scottish Government looks to developing its future economy, we would urge it not to overlook tourism and hospitality as a trusted economic driver and ensure that it receives greater positioning as we look to grow the economy," Marc Crothall, chief executive of the Scottish Tourism Alliance told The Herald.

"Concerning any new legislation, we would be looking to the Scottish Government to work early on with the UK Government to ensure a more joined-up approach to avoid any unintended consequences like those we experienced with the deposit return scheme. There appears to be a thawing in the relationship between both governments across the border, but we are looking for evidence of this in practice."

In his conference speech on Sunday, Mr Swinney gave a taste of policies that would be announced on Wednesday to tackle child poverty, grow the economy, attract investment and improve public services.

He set out plans for a new benefit to give "whole family support" to help low income households, told delegates, in a section of his speech on renewable energy, he wanted his ministers "out there getting investment, investment, investment in the future of Scotland" and said his government would "bring forward reforms to shift the balance of care to preventive and community-based support" in the NHS.