Engineering industry gets on with business.

The first Quarterly Review of the engineering industry for 2017 shows a further improvement in most areas.  There is healthy growth in export orders, in particular where a net 30% of businesses are reporting above normal activity.

The QR survey also records a 27% positive return for total orders.

Bryan Buchan, Chief Executive of Scottish Engineering, attributes the dramatic gains in export orders in part to the relative weakness of Sterling.

Similar success is being reported by machine shops: +38%, and mechanical equipment: +10% in their UK orders, and by metal manufacturing: +33% and transport: +50% in their export orders.

Output volume throughout the engineering sector shows a net +14%, and optimism at a net +17% is also showing improvement on the previous improvement reported in the final quarter of 2016.

Looking forward, forecasts for the next three months in UK orders remain positive, with metal manufacturing +11%, and machine shops +13%, maintaining a strong trading position.  Output volume in the next quarter is also predicted to be +38% for transport and +10% for metal manufacturing.

Commenting on the sector generally, Bryan said: “After the initial shock of last year’s Brexit vote, engineering companies in Scotland have adopted the usual pragmatic approach and buckled down to getting on with business.

“Major areas of concern for all Scottish operations include the revisions in business rates, the relatively unfavourable mid-range personal taxation regiment and the long-awaited set ails of the disbursement of the Apprenticeship Levy takings.”

The Guest Writer in this edition of the Review is Will Dowson, the Bank of England’s Agent for Scotland, who sees a positive future for the engineering industry in Scotland.  He comments: “There is some uncertainty about the post-Brexit landscape, particularly for those companies that rely heavily on international trade, and some investment plans have been affected, which could drag on broth over the coming years.

“It is clear that the UK’s new relationship with the EU – and the reforms that it brings about, both at UK levels and here in Scotland – will determine our long-term prosperity.”



Scottish Engineering Annual Awards Dinner 2017.

This year’s Annual Awards Dinner will be held on Thursday 18th May at the Marriott Hotel, Argyle Street, Glasgow.

Our Principal Speaker will be John Baxter, CBE, FRSE, FREng, who is currently Chairman of the ANRC (Advance Nuclear Research Centre) and Visiting Professor of the University of Strathclyde.  Mr Baxter was formerly Head of Engineering at BP.  He trained as a Royal Navy Submarine Engineer Office, including postgraduate nuclear studies at the Royal Naval College, Greenwich, and also served as a nuclear submariner.  John’s subsequent career with the United Kingdom Atomic Energy Authority covered all aspects of the nuclear programme.  Most recently, he served on the Defence Nuclear Strategy Committee.

The after dinner entertainer will be Willie Allan, who lives in Dunfermline and is well-known on the after dinner circuit.

The booking form can be found here: 2017 Annual Dinner info

If you require further information, please contact:



Made In Scotland Awards 2017.

The Made In Scotland Awards champions all aspects of transformational discoveries and developments made in Scotland.  From innovation in business services to innovative companies that have found success, both domestically and internationally.  Past winners have ranged from companies making products that work in harsh environments, through innovative domestic gadgets designed in Scotland, to a leading craft brewer.

More information can be found via the following link:

Nomination forms can be completed via:

Nominations will close on Friday 3rd March, with the judging taking place on Tuesday 14th March.

The Awards ceremony will take place on Wednesday 19th April at the Glasgow Science Centre.

If you require further information, please contact Julie Ritchie, Events Assistant, Trinity Mirror plc.  Tel: 0141 309 3052 or email:

Bryan Buchan, Chief Executive of Scottish Engineering, has been invited to join the judging panel.

Published on behalf of Scottish Business Insider.



Government Review of Employment Tribunal Fees.

The Government’s response to the review on the impact of tribunal fees has eventually been released.  The responses concluded that the introduction of tribunal fees has broadly met the financial objectives and has encouraged potential Claimants and Respondents to use alternative dispute resolution services.  However, the report also acknowledges that the fall in claims was greater than expected and that fees may have discouraged some people from bringing proceedings, although it was stated that there was no evidence that they were prevented from doing so.

The Government has now issued a further consultation (now called ‘Help with Fees’) to assist people on lower incomes, and the Ministry of Justice has decided that with immediate effect fees will not be charged for certain types of proceedings which relate to payments from the National Insurance Fund, such as claims for a redundancy payment under Section 170 of the Employment Rights Act 1996.


National Minimum Wage Regulations 2017.

The National Minimum Wage Regulations have been published.  Rises for the national minimum wage and the national living wage have been aligned and are intended to come into force on 1 April 2017.  The amended rates are as follows:

National Living Wage

Age 25+ from £7.20 per hour to £7.50 per hour

Age 21+ from £6.95 per hour to £7.05 per hour

Age 18-20 from £5.55 per hour to £5.60 per hour

Age 16-17 from £4.00 per hour to £4.05 per hour

Apprentices from £3.40 per hour to £3.50 per hour

Final Draft of Gender Pay Gap Regulations published

The final draft of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 has been published and the Regulations are due to come into force on 6th April 2017 subject to Parliamentary approval. There have been a number of important changes made to the previous draft regulations which were published earlier this year as follows:-

1. Relevant Employers – This is a private or voluntary sector employer with 250 or more employees on the relevant date which is 5th April in the relevant year. This is based on employees of a particular entity rather than being group based. Public sector employers are now expressly outwith the scope but the Government plans to introduce similar reporting obligations for public sector employers shortly.

2. Relevant Employees – This has now been altered to “a person who is employed by the employer on the relevant snapshot date (5th April)”. It has now been clarified that the wider definition of employment applies and therefore will include workers and self-employed contractors who are under a contract personally to do work. Partners (including LLP members) are now expressly excluded. There is an exception in the reporting duty in relation to anyone in respect of whom the employer does not have the relevant data and it is not reasonably practicable for it to obtain that data eg. where the contractor is paid a fixed price and no records are made of hours worked. Employees are also now excluded from the pay reporting obligation if they receive less than full pay as a result of leave, eg employees on sick leave, maternity leave or shared parental leave.

3. Snapshot Date – This is the date on which employers must record pay data for reporting purposes and has been altered from 30th April to 5th April.

4. Ordinary Pay – This includes basic pay, allowances (but not out of pocket expenses) pay for piece work, pay for fully paid leave and shift premium pay.

5. Bonus Pay – This is now defined as any remuneration that is in the form of money, vouchers, securities, securities options or interests in securities and relates to profit sharing, productivity, performance, incentive or commission. It does not include overtime pay or remuneration referable to redundancy or termination of employment. The relevant period for bonus pay reporting is the 12 month period ending on the snapshot date ie. for the first gender pay gap report between 6th April 2016 and 5th April 2017 and will include all relevant employees ie. those on unpaid leave are included in this reporting requirement. Gender pay gap reporting is based on the hourly rate of pay which includes both ordinary pay and bonus pay paid during the relevant pay period. Where bonus pay is referable to a period longer than the relevant pay period eg. an annual bonus, then only a pro-rata amount is taken into account when calculating the hourly pay in the pay reference period.

6. Quartiles – This reporting requirement only applies to full pay relevant employees. It has been clarified that each of the 4 pay bands of quartiles must include an equal number of employees and they are to be reclassified as lower, lower middle, upper middle and upper quartile pay band. The proportion of female full pay relevant employee in each quartile pay band must be expressed as a percentage of the full pay relevant employees within that band.

What Must Be Published?

1. Median and mean gender pay gap figures for pay based on the hourly pay of full pay relevant employees during the relevant pay period. This will include a pro-rata proportion of any bonuses paid during the relevant pay period.

2. Median and mean gender pay gap figure for bonuses paid in the year ending with the snapshot date.

3. The percentage of men and women who receive a bonus.

4. The number of men and the number of women in each pay quartile expressed as a percentage of the total number of full pay relevant employees in each quartile. The information must be published on the employer’s website for at least 3 years in a way that is accessible to all employees and to the public and also on a central website which is to be set up by the Government for that purpose. The figures must be accompanied by a written statement of accuracy signed by a Director or equivalent.


Apprenticeship Levy

Starting in April 2017, employers will require to pay the Apprenticeship Levy at 0.5% of their annual wage bill.  Each employer will receive an allowance of £15,000 per year to offset against the levy, meaning that in practice only employers with a wage bill of over £3million will pay the levy.

In Scotland, the system for distribution will differ from that to be established in England and Wales.  The Scottish Government has announced that a Workforce Development Fund is to be established in the autumn of 2017, to which employers will be able to apply for funding to upskill or reskill their employees.  The Workforce Development Fund is to be designed with employers’ input via the Scottish Apprenticeship Advisory Board and a working group is to be set up.

Therefore, it appears that the fund will not be restricted to funding for apprenticeships, although it remains a stated aim of the Scottish Government to deliver 30,000 Modern Apprenticeship starts per year by 2020.  In England and Wales, a system of digital vouchers is to be utilised, and at present is to be restricted for use to fund apprenticeships only.


Commenting on the Prime Minister’s Brexit speech, Bryan Buchan, our Chief Executive, said:

“The issues covered by the Prime Minister were very broadly expressed.  Two areas we really see as being crucial, are that legislation as it applies to business will now be our own preserve and won’t be controlled from Europe.

“In terms of trading with Europe, the fact that we are a vitally important market for both France and Germany should mean that we will not be subject to punitive tariffs.

“After the initial shock of the EU referendum result, engineering businesses in Scotland took up the challenge and are now widening our export trade, and expect to benefit from entering the growing market opportunities.

“Mrs May suggested that our industries were stagnating within the EU.  Let’s hope that we are sufficiently motivated to take advantage of the broader horizons opening up in the currently expanding markets of China, India, Malaysia and Brazil, while taking advantage of our special relationship with the USA.”


Commenting on the First Minister’s Brexit proposals for Scotland today, Bryan Buchan, our Chief Executive, said:

“The First Minister’s “second strand” proposal to devolve business and trade regulations from the UK norm would be totally impractical.  In the unlikely event that Scotland was allowed to be part of an EU while the rest of the UK had left, our manufacturing sector would literally have to adopt two regulatory systems if they were to continue trading with the UK which is recognised as our largest market.

“It would potentially make the tendering process so complicated that customers in the rest of the UK would probably opt for a more local supplier rather than try to accommodate the established Scottish supply chain”

Proposed increases to Statutory Maternity, Paternity, Adoption, Shared Parental and Sick Pay announced

These increases are proposed to take effect in April 2017.

  1. Statutory Sick Pay (SSP) – £89.35 (up from £88.45)
  2. Statutory Maternity Pay (SMP) – £140.98 (up from £139.58)
  3. Statutory Paternity Pay (SPP) – £140.98 (up from £139.58)
  4. Statutory Shared Parental Pay (ShPP) – £140.98 (up from £139.58)
  5. Statutory Adoption Pay (SAP) – £140.98 (up from £139.58)

It is currently unclear on what date the changes will come into effect as the statement released by the Department for Work and Pensions suggests 10th April 2017.  However, historically these increases have normally occurred on the first Sunday in April, which would be 2nd April 2017.

Members will be kept up-to-date via Members’ Briefings.