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'Support group needed for failures'

 

Failed entrepreneurs should be helped back onto their feet through a support group, a Holyrood committee has heard.

The suggestion was among a range of ideas from academics and economists geared towards boosting the economy in Scotland.

MSPs on the Finance Committee heard that there should be adequate help at the end of a failed business to match the encouragement and incentives at the start.

Colin Mason, professor of entrepreneurship at Glasgow University's Adam Smith Business School, said that one of his students is investigating the impact of failure, saying: "It's a traumatic experience if your company has failed. It has a knock-on effect on your social life. I just wonder, as a society, if we encourage people to start businesses, we don't have some responsibility for some sort of after-care service for entrepreneurs who have actually failed."

The panel of experts also included representatives from Aberdeen University, the David Hume Institute, RBS, Lloyds banking group and the Royal Society of Edinburgh.

Between them they called for an increase in the capital budget, which would have to come from Westminster, more tailored financial help for entrepreneurs and a better focus on school-age pupils seeking career direction.

Mr Mason made his support group comment while calling for a change of attitude towards more risky, high-growth projects. Despite successes in getting started, Scottish firms are often bought out and shifted abroad, he said. The effect is a loss of head offices in Scotland, which can damage the supply chain and hold back the economy.

Ian Ritchie, vice-president of the Royal Society of Edinburgh, said there is a perception that people in Scotland are not naturally entrepreneurial: "We need to do something about the attitude about the Scots to starting businesses. On our soap operas on TV or radio it's always the businessman who's the crook. We have these attitudes issues we could maybe tackle."

Donald MacRae, chief economist of Lloyds Banking Group Scotland, called for more capital spending in the Scottish budget to increase economic growth.

"Capital spending in Scotland is low compared to what it has been," he said. "I realise that the Scottish Government is constrained by its total budget but I would argue we should be looking to increase those totals in capital spending in each of the next three or four years."

 
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