




The outlook for the Scottish and UK economies has weakened, with growth now expected to remain sluggish through the rest of 2025.
In its latest quarterly Economic Commentary, the Institute has downgraded its forecasts for Scottish economic growth to 0.8% in 2025 and 1% in 2026.
This comes despite more upbeat projections from both the Scottish Fiscal Commission (SFC) and the Office for Budget Responsibility (OBR), which have recently upgraded their expectations for 2026 whilst similarly revising down their GDP forecasts for 2025.
Economic growth is now slowing compared to the start of the year and inflation has also edged up to 3.4%, after staying below 3% throughout 2024.
The business environment is also showing signs of strain, with companies reporting cutting back on activities in the first quarter compared to last year, plagued by rises in National Insurance Contributions, which took effect in April, alongside uncertainty surrounding President Trump’s trade tariffs. Indeed, pay growth and employee numbers are down, signalling potential weaknesses in the labour market.
The current state of the economy was not unexpected: Institute Director Professor Mairi Spowage warned of turbulent and uncertain conditions which could last throughout the year in the previous commentary.

Professor Spowage said: “After a strong start to the year, the Scottish economy has faltered in March and April and is essentially the same size in real terms as it was six months ago.
“Unfortunately, the wider business environment and global events are still taking a toll on businesses and consumers, which is having a dampening effect on spending and business investment.”
In addition to the latest economic analysis, the commentary provides an overview of Universal Credit and Legacy Benefits in Scotland, a key element of the nation’s social security system, and summarises key takeaways from June’s spending review and medium-term financial strategy.
Dr Joao Sousa, Deputy Director of the Institute, said: “The fiscal announcements by both governments suggest that there are significant economic challenges in the years and months to come for the UK and Scottish Governments.
“Particularly from 2027-28 onwards, the choices of Government look to become more difficult. Of course, this is the role of the Government in power: but the difficulties of the UK Government this week show that events can quickly derail its plans.”
Read more here.
The Scottish Conservatives reckon they know where the problem lies …

The Fraser of Allander Institute has downgraded Scotland’s growth forecast.
The SNP’s anti-business policies and high-tax agenda are having a detrimental impact on the economy.

A new inquiry will explore the provision of children’s TV and video content in the UK and what can be done to ensure future generations continue to have access to high-quality British-made programming.
Research from Ofcom shows a structural shift in the viewing habits of young people, with television viewing by children dropping and YouTube now the most used app or site by children of all ages, with 88% of 3 to 17-year-olds using it last year.
The changing ways in which audience consume TV and video, has made it more challenging for public service broadcasters to make original TV content for children and for it to be found. This has a knock-on effect for those in our creative industries who want to make quality UK TV and video for children.
The Culture, Media and Sport Committee inquiry will therefore examine how to ensure those making original high-quality content can continue and how it can be made easier to find it online.
It will also explore issues relating to parental control of online content, the potential positive and negative effects of how children watch TV and video content on their health and development, and wider issues relating to the sector’s contribution to the economy and its importance to the UK’s cultural identity.

Chair of the CMS Committee, Dame Caroline Dinenage MP, said: “Children’s viewing habits have come a long way, but whether they watch through a smart TV or a tablet, there is still demand for good quality TV and video for children.
“We all want young people to have access to a range of programming, so in addition to cartoons, they also see drama and factual programmes. We want them to be able to be educated and inspired, as well as entertained.
“Changes to the media landscape, particularly the shift in viewing to YouTube, pose huge challenges for the future of children’s programming and the continued production of original content by our public service broadcasters.
“We want to know what prominence means for programmes made for children in the future world of smart TVs, streaming, video sharing platforms and endless choice.
“We have a proud history of high-quality children’s television in the UK. Our inquiry will be showcasing the contribution the sector makes to both our culture and economy and how we can best ensure that content designed for children in all its forms continues to both educate and entertain.”

Terms of reference
The Committee is inviting written submissions in response to the following questions:
Children’s TV and video content in the UK
Finding children’s TV and video content online
Health and child development
Wider benefits of children’s TV

Earlier in June, we marked the 40th anniversary of Volunteers’ Week 2025, a moment to celebrate the extraordinary impact of volunteers across Scotland. From 2 to 8 June, organisations, communities and individuals came together to recognise the essential role volunteers play in shaping a more compassionate and connected society (writes FOYSOL CHOUDHURY MSP).
Behind every community hub, crisis helpline and mentoring programme in Scotland, there is a volunteer quietly making a difference.
This year’s campaign came at a critical time. Volunteering rates, particularly in Edinburgh and across Lothian, have seen a worrying decline. They are down around 8 per cent since 2019, as a result of pandemic disruptions, the rising cost of living and reduced funding for volunteer support programmes. Yet across food banks, youth services and elderly care, the calls for help continue to rise. The need for volunteers has never been greater.
In response, Inspiring Scotland commissioned Catalysts for Change, a new report exploring what motivates people to volunteer, the barriers they face, and how Scotland’s volunteering landscape can evolve. The report was launched during Volunteers’ Week and shared with the Scottish Parliament’s Cross-Party Group on Volunteering, offering practical and timely recommendations to strengthen recruitment, engagement and retention.
Two of Inspiring Scotland’s initiatives bring this work to life. The Specialist Volunteer Network brings together professionals who offer their time and expertise to support charities and community organisations.
Meanwhile, Intandem, a mentoring programme for care-experienced young people, is entirely powered by volunteer mentors. Last year alone, more than 280 volunteers provided consistent weekly support to young people navigating life in or on the edge of the care system.
During the most recent Cross-Party Group meeting, several organisations spoke about the far-reaching benefits of volunteering for both communities and individual wellbeing. Vintage Vibes, a project combatting loneliness among Edinburgh’s older population, matches isolated individuals with committed volunteers. One pairing, Natalia and Maja, shared the joy, connection and sense of purpose their weekly visits bring to both their lives.
Similarly, the RNLI, where volunteers fill 97 per cent of frontline roles, emphasised how life-saving work in schools and coastal communities depends on public goodwill and civic action.
One volunteer, Rachel, described how volunteering gave her confidence, a sense of community, and a renewed sense of direction, something that positively influenced her career. It is proof that volunteering may begin as an act of giving, but it often gives you so much more in return.
While Volunteers’ Week is a national moment of recognition, the value of volunteering is felt year-round. Whether by offering time, skills or simply a listening ear, volunteers form the backbone of Scotland’s social infrastructure. From mentoring teens to delivering meals to vulnerable neighbours, their quiet work touches every corner of our society.

As Co-Convener of the Cross-Party Group on Volunteering, I would like to extend my heartfelt thanks to everyone who dedicates their time to supporting others.
But appreciation alone is not enough. We must make it easier for people to get involved by offering more flexible opportunities, investing in local initiatives, and creating pathways that remove barriers to participation.
By working together, we can rebuild a thriving culture of volunteering and ensure that no community is left behind.
The Scottish Government must match recognition with meaningful investment, stronger coordination, and long-term policy support to help volunteering thrive across the country.
To explore local volunteering opportunities, visit https://volunteer.scot
You can also read the full Inspiring Scotland report: Catalysts for Change: Understanding the motivations of volunteers in Scotland (new report published)

First Minister John Swinney has paid tribute to the eight Scottish recipients of The Elizabeth Emblem.
The emblem is awarded posthumously to family members of those who died in public service. It is the civilian equivalent of the Elizabeth Cross, which recognises members of the UK Armed Forces who died in action or a terrorist attack.
The First Minister said: “I warmly welcome the awarding of The Elizabeth Emblem to these individuals and their families.
“This recognition enables us to remember their sacrifice and their lives dedicated to public service. They made Scotland a better place for us all and we continue to honour their memory.”
The Secretary of State for Scotland, Ian Murray said: “I pay tribute to all of those Scots who have been recognised today. Every one of these brave public servants gave their life to protect others. They are people who stepped forward when most of us would step back, and they paid the ultimate price.
“I am particularly pleased that Dunblane teacher Gwen Mayor has been recognised. No-one will ever forget the horror of the shooting at Dunblane Primary School in 1996, when Mrs Mayor was killed trying to protect her pupils.
“I hope that the families of all those recognised will take some comfort in knowing that their loved ones, and their service, has not been forgotten.”

The family of Dunblane Primary School teacher Gwen Mayor including her husband Rodney Mayor said: “As a family we are extremely proud and honoured to be receiving this award on behalf of Gwen. We always believed her actions that day deserved more recognition.
“You would have to have known Gwen to know that she would have done whatever trying to protect the children in her care. She paid the ultimate price for that commitment. Finally we now feel that she has been honoured for what happened that day.”
The full list of Scottish recipients of The Elizabeth Emblem are:

More work is needed if the Dog Theft (Scotland) Bill proceeds to the next stage of the legislative process. This is the recommendation in a new report issued by Holyrood’s Rural Affairs & Islands Committee.
Publishing its Stage 1 report, the Committee says that it supports the general principles of the Bill. However, should the Bill progress to the next stage, the Committee sets out areas for reconsideration and development.
The Committee says that, although the creation of a specific statutory offence of dog theft would recognise that dogs are sentient beings and reflect the impact on animal welfare, there is no clear evidence to suggest that a statutory offence would be used more in practice than the existing common law.
In addition, without a dedicated budget for raising awareness of the statutory offence, and with similar penalties as are currently available for the existing offence, the Committee say it is unlikely to act as a strong deterrent.
The report also says that making the theft of an assistance dog an aggravated crime does not seem a ‘proportionate provision’. To date, no instances of dog theft have been reported, and the court system can already consider the impact of any theft, if a case does come to court.
The Committee recommends however that, if the proposed aggravation proceeds to Stage 2, a broader definition for dogs providing support and assistance, for example working farm dogs, should be included.
The Committee says that it does not support allowing victims of dog theft to make victim statements to the court.
During scrutiny, stakeholders said that courts already consider the impact of crimes on victims and that providing this opportunity to victims of dog theft, would create an anomaly with other crimes which do not allow victim support statements.
Instead, the Committee asks the Scottish Government to include dog theft within its broader commitment to expand the range of offences where victim statements are allowed.

Committee Convener, Finlay Carson MSP, said; “This is a well-intentioned Bill which merits our support at this stage in the legislative process. We agree that dog theft is a terrible crime, and that appropriate legislation should be in place to reflect this.
“However, evidence provided to us during our scrutiny suggests that many of the Bill provisions are already available within the current court system and procedures. It’s important to ensure legislation and enforcement procedures do not create untended consequences or further bureaucratic burdens.
“It’s now for the Scottish Parliament to consider the reservations we have set out in our report and to decide the best route forward.”
REBELS FORCE FURTHER CONCESSIONS

MPs voted by 335 votes to 260 to give the Universal Credit and Personal Independence Payment Bill their initial backing last night after rebel Labour MPs forced further concessions from the government.
The Government, gearing a humiliating defeat, said it would pause changes to PIP until a review has been carried out.

Despite the concessions, 49 Labour MPs, including local North and Leith MP Tracy Gilbert, voted against their government.
Ms Gilbert was one of only three Scottish Labour MPs to oppose the Bill.
45 MPs – 18 of these Labour – abstained or did not vote.
Labour Campaign for Socialism issued a statement after the vote:

Conservative leader Kemi Badenoch said: “This is an utter capitulation. Labour’s welfare bill is now a TOTAL waste of time. It effectively saves £0, helps no one into work, and does NOT control spending. It’s pointless.”
Ms Badenoch said that the Starmer government should ‘ditch the bill, do their homework, and come back with something serious’.
Scotland’s First Minister John Swinney said: “Labour’s behaviour towards people with disabilities is appalling.
“The chaos that Keir Starmer and Rachel Reeves have presided over has shown total contempt for the vulnerable. And Anas Sarwar has supported them all the way. Westminster is failing. Scotland deserves better.”
Anti-poverty campaign group Trussell said: ‘The government’s bill to cut disabled people’s social security is still proceeding, but with all cuts to PIP now set to be REMOVED. We applaud the power of disabled people, MPs, and community organisations like food banks who have tirelessly raised their voices and stood up for future of disabled people
‘The improvements to the bill agreed in recent days are the right thing to do and will protect hundreds of thousands of disabled people from being forced into severe hardship.
‘This bill should never have come before MPs. This was a chaotic and upsetting process that could have been avoided had this government stuck to its commitments to disabled people.
‘Deep cuts to Universal Credit still stand, and when MPs look at the amended Bill, they must ensure disabled people are protected from severe hardship ahead of their final vote next week. More than three quarters of people claiming Universal Credit and disability benefits have gone without essentials in the last six months.
‘We now have an opportunity to work together to build a more compassionate, effective, and fair system of social security for disabled people, and move towards a future without the need for food banks.’

New rules to be laid in Parliament see skills and salary thresholds rise, overseas recruitment for care workers end and more than 100 occupations no longer granted access to the immigration system.
These changes, the first to be rolled out from the Immigration White Paper, represent a fundamental shift in the UK’s approach to immigration and restore order to the points-based system, focusing on higher skills, lower numbers and tighter controls. They are an important step in ending the UK’s reliance on overseas, lower skilled recruitment.
The introduction of an interim, time-limited and conditional temporary shortage list will make sure the immigration system works better for the UK, with international recruitment only providing support where occupations are key to the industrial strategy or building crucial infrastructure.
Each sector must have a workforce strategy in place to train UK workers, or it will lose access to the immigration system.
Home Secretary Yvette Cooper said: “We are delivering a complete reset of our immigration system to restore proper control and order, after the previous government allowed net migration to quadruple in four years.
“These new rules mean stronger controls to bring migration down, to restore order to the immigration system and to ensure we focus on investing in skills and training here in the UK.
“As part of the Plan for Change, we can build an immigration system that serves the needs of the British economy and people – one that values skills, tackles exploitation, and ensures those who come to the UK make a genuine contribution.”
The package of measures includes:

Workers in occupations on the temporary shortage list will no longer be able to bring dependants and will not be permitted salary and visa fee discounts. The occupations included on the List are time-limited until the end of 2026 and will only remain beyond that date if the independent Migration Advisory Committee recommend it.
In the interim, the government will not hesitate to restrict immigration access further, should there be clear signs of abuse and exploitation in sectors. In time, we will also abolish the previous government’s immigration salary list.
Subject to parliamentary approval, the changes will come into effect from 22 July, and transitional arrangements have also today been set out for overseas care workers already in the UK.
Next steps
Further changes to be implemented by the end of this year also include:
The Immigration White Paper forms part of a broader programme of immigration and border security reforms, with further measures on asylum and border security to be announced later this year.

The Association of Scotland’s Self-Caterers (ASSC) has launched a Scotland-wide campaign which strongly criticised the ongoing claims from certain sectors of national and local government that Scotland’s housing emergency has been caused by legitimate owners of self-catering properties.
The campaign, which highlights the issue of elected representatives and officials scapegoating the sector while, at the same time, a far greater number of available properties lie empty across Scotland, launched in Edinburgh this morning, with stops outside Edinburgh City Chambers, as well as Holyrood.
The campaign will continue this week with stops encompassing Glasgow, Helensburgh, Inverness, Perth and Glenrothes, as well as the two previous stops in Edinburgh.
Self-caterers have become an easy target for lazy attempts to scapegoat the sector, rather than deal with the real issues at hand; utilising empty properties and building more affordable housing. The Association of Scotland’s Self Caterers would rather deal in facts, which are:
It’s time to set the record straight. Let’s talk facts – not fiction.
It is clear that housing needs will not be met by penalising tourism microbusinesses. Instead, they will be met by building homes, tackling second homes, and taking an evidence-led approach.

Fiona Campbell MBE, CEO of the Association of Scotland’s Self-Caterers, said: “Hard-pressed self-catering operators will be experiencing more than a little sense of déjà vu as their sector is once again scapegoated for a shortage of homes.
“Recycling the same tired calls for even stricter controls on short-term lets, despite no evidence it will ease housing pressures, is regulatory overkill. They risk hammering a £864m self-catering sector that underpins Scottish tourism.

“Our message is clear: you won’t solve a housing crisis by initiating a crisis in Scottish tourism by decimating local businesses underpinning local economies. Attention must shift to the real causes of the housing crisis and stop scapegoating self-catering.”

Food retailers and manufacturers will “make the healthy choice the easy choice” in a world-first partnership between government and industry to tackle the obesity epidemic and ease pressure on the NHS as part of the Plan for Change.
As part of the forthcoming 10 Year Health Plan, large retailers including supermarkets will be set a new standard to make the average shopping basket of goods sold slightly healthier.
Businesses will be given the freedom to meet the standard however works best for them, whether that’s reformulating products and tweaking recipes, changing shop layouts, offering discounts on healthy foods, or changing loyalty schemes to promote healthier options.
Public health experts believe cutting the calorie count of a daily diet by just 50 calories would lift 340,000 children and 2 million adults out of obesity. If everyone who is overweight reduced their calorie intake by just 216 calories a day, equivalent to a single bottle of fizzy drink, obesity would be halved.
Obesity is one of the root causes of diabetes, heart disease and cancer. With the UK now having the third highest rate of adult obesity in Europe, it remains a critical public health challenge, costing the NHS £11.4 billion a year, three times the NHS budget for ambulance services.
Obesity rates have doubled since the 1990s, including among children. A forthcoming report by the Chief Medical Officer will show that more than 1 in 5 children are living with obesity by the time they leave primary school, rising to almost 1 in 3 in areas with higher levels of poverty and deprivation.
It follows the government setting out in recent days a number of measures to tackle rapidly growing health inequalities, including investing more in working class communities where health disparities are greatest, and rapid action on the maternal mortality gaps in Black, Asian and working class communities.
Through our Plan for Change, the government is shifting the focus from treatment to prevention and creating a more active state – that works with partners to make the healthy choice the easy choice – and a transition of the NHS from a sickness service to a prevention service.

Health and Social Care Secretary, Wes Streeting, said: “Obesity has doubled since the 1990s and costs our NHS £11 billion a year, triple the budget for ambulance services. Unless we curb the rising tide of cost and demand, the NHS risks becoming unsustainable.
“The good news is that it only takes a small change to make a big difference. If everyone who is overweight reduced their calorie intake by around 200 calories a day – the equivalent of a bottle of fizzy drink – obesity would be halved.
“This government’s ambition for kids today is for them to be part of the healthiest generation of children ever. That is within our grasp. With the smart steps we’re taking today, we can give every child a healthy start to life.
“Our brilliant supermarkets already do so much work for our communities and are trying to make their stores heathier, and we want to work with them and other businesses to create a level playing field.
“Through our new healthy food standard, we will make the healthy choice the easy choice, because prevention is better than cure.
“By shifting from sickness to prevention through our Plan for Change, we will make sure the NHS can be there for us when we need it.”

Environment Secretary Steve Reed said: “Britain has some of the best farmers, growers, food manufacturers and retailers in the world, which means we have more choice than ever before on our shelves.
“It is vital for the nation that the food industry delivers healthy food, that is available, affordable and appealing.
“Our food strategy will bring together the health plan, food producers and retailers to make sure we can feed the nation more healthily while growing the economic success of our food sector.”
The policy will see all big food businesses report on healthy food sales. This will set full transparency and accountability around the food that businesses are selling and encourage healthier products.
The government will then set targets to increase the healthiness of sales in communities across the UK and work with the Food Strategy Advisory Board on the sequencing of this policy.

Sarah Price, NHS England Director for Public Health, said: “A healthy diet, which includes a variety of nutritious food can help people stay well and provide long-term health benefits, which is good for them and good for the NHS.
“That is why this move to make it easier for people to shop for healthy and nutritious food options is so important – it will help people reduce the risk of developing a range of life-altering physical conditions, such as obesity and Type 2 diabetes – both of which are on the increase in England.”
Major investment firms have already signalled that they would be keen to invest more in healthier products, if they were given due prominence and promotion by food retailers.
Many supermarkets want to do more to make the average shopping basket healthier, but they risk changes hitting their bottom lines if their competitors don’t act at the same time. The new standard will introduce a level playing field, so there isn’t a first mover disadvantage.
The changes are part of the UK government’s 10 Year Health Plan, due to be published shortly. The plan will radically reform the health service and improve the health of the nation, to make the NHS sustainable and fit for the future.
Ken Murphy, Tesco Group CEO, said: “All food businesses have a critical part to play in providing good quality, affordable and healthy food. At Tesco, we have measured and published our own healthier food sales for a number of years now – we believe it is key to more evidence-led policy and better-targeted health interventions.
“That’s why we have called for mandatory reporting for all supermarkets and major food businesses and why we welcome the Government’s announcement on this.
“We look forward to working with them on the detail of the Healthy Food Standard and its implementation by all relevant food businesses.”
Simon Roberts, CEO of Sainsbury’s commented: “We’re passionate about making good food joyful, accessible and affordable for everyone and have been championing the need for mandatory health reporting, across the food industry for many years.
“Today’s announcement from Government is an important and positive step forward in helping the nation to eat well. We need a level playing field across the entirety of our food sector for these actions to have a real and lasting impact.
“We look forward to working across Government and our wider industry on the further development of these policies and in helping to drive improved health outcomes across our nation.”
Ravi Gurumurthy, CEO of Nesta, said: “Most of us want to lose weight and make healthier choices but the food that surrounds us makes that too hard. That’s why obesity has doubled since the 90s.
“This new standard focuses on lots of small changes that make it easier to buy food that’s a little bit healthier. Nationally, it could send obesity rates down by a fifth – through business and government working together to improve our health.”
Sue Davies, Which? Head of Food Policy, said: “Which? research has shown that people want retailers to do more to support them in making healthier choices. Six in 10 (60%) consumers said they support the government introducing health targets for supermarkets.
“Mandatory food targets will help to incentivise retailers to use the range of tactics available to them to make small but significant changes – making it easier for people to eat a balanced diet and lead healthier lives.”
John Maingay, Director of Policy at the British Heart Foundation (BHF) said: “A new standard to make meals across the UK healthier is a huge step towards creating a food environment that supports better heart health. This move recognises the vital role that businesses can play in supporting everyone to have a healthier diet.
“Obesity puts people at greater risk of developing cardiovascular disease, which remains one of the UK’s biggest killers. We hope to see real momentum behind this new standard to make the healthier choice the easiest choice once and for all.”
Michelle Mitchell, Cancer Research UK’s chief executive, said: “Businesses can play a major role in supporting people to make healthy choices, and this important step could help to reduce rising obesity rates.
“Being overweight or obese is the second biggest cause of cancer in the UK, and is linked with 13 different types of the disease.
“The UK government must introduce further bold preventative policies in both the upcoming 10-year health plan and National Cancer Plan, so that more lives can be saved from cancer.”
Katharine Jenner, Director, Obesity Health Alliance, said: “This is a fair and evidence-based prescription for better health; big businesses urgently need the government to level the playing field to help them focus on selling products that help people live well.
“The government has rightly identified the root cause of obesity-related ill health: a food system that makes healthy eating difficult. Crucially, it puts the spotlight on the food industry and commits to holding it accountable for providing healthier options – rather than placing the burden on individuals who are already struggling to get by.”
Henry Dimbleby, Author of the National Food Strategy and Independent Review for Government said: “What gets measured gets done.
“Mandatory reporting is a crucial first step in improving the food environment – it creates a level playing field, rewards the businesses already acting, and gives us a clear picture of what’s really being sold.
“It’s fantastic to see food retailers themselves calling for this. With proper data, we can start to reshape the food system and make healthier choices easier for everyone”