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Survey Results: The Impact of Scottish Government Regulations on Business

Summary of evidence in the form of a survey circulated between 11th and 16th April 2024 on short-term let regulations is a stark reflection on the impact of short-term let regulations on the self-catering sector.

This survey formed part of the New Deal for Business activity and supports the delivery of the recommendation within the New Deal for Business Group Report: “The Scottish Government should develop a process for identifying, considering and removing regulations no longer required, driven by active engagement with business.”

The aim of the survey was to identify regulations that are considered to no longer serve their intended purpose and no longer required within the regulatory environment and regulations that businesses consider could be improved or simplified are also sought.

The results demonstrate that both licensing and planning regulations are having profoundly negative consequences for self-catering operators. The survey also contains some compelling case studies which illustrate the real-world impact of these regulations on small business owners across Scotland.

  • 531 respondents
  • 70% of which are ASSC Members
  • 50% are in a rural location or on an island, while 50% represent just 1 property (70% between 1-2 properties)
  • This survey represents 7,045 bed spaces and over 2000 properties (units).

Key Results

  • 77% of businesses report a negative or extremely negative impact on business operations as a consequence of the Scottish Government’s STL regulations, with 86% noting it had stifled innovation and 72% saying it had reduced competitiveness.
  • Worryingly, nearly two-thirds (64%) said the regulations had adversely impacted how their business was perceived by the public.
  • 82% said the regulations had severely damaged business certainty and confidence.
  • Most businesses do not believe that STL licensing and planning laws accord with the Scottish Government’s own Better Regulation principles of being proportionate, consistent, accountable, transparent and targeted.
  • Respondents highlight the large inconsistencies in fees paid for STL licences across the country, with some paying £2500 for a licence for one property, which necessitates the need for potential adjustments to ensure fairness and cost recovery in fee structures.
  • For the total cost of compliance for licensing applications, some businesses are forking out as much as £9000. On planning permission or certificate of lawfulness applications, costs have ranged from over £1000 to £4500.
  • With such costs, it is unsurprising that 82% describe the financial burden on their business as ‘detrimental’ or ‘significantly detrimental’, with a further 12% saying it was ‘devastating’.
  • 92% highlight a significant administrative burden on their business, with 82% believing there was also an impact on relevant authorities.
  • Nearly half (46%) do not consider that the underlying policy objective of licensing – to improve health and safety – has been met, with 70% saying the policy has failed on addressing anti-social behaviour and residential amenity.
  • 88% do not believe that the regulations have transferred more housing stock to residential use.
  • With the current regulatory framework failing businesses and not meeting its policy objectives, 92% believe a simple, cost-effective self-certification registration scheme with mandatory health and safety compliance would be a better alternative.

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