Scots election candidates clash at business and economy hustings

The constitutional issue reared its head at an election hustings dedicated to the future of Scottish business and the economy, where candidates also set out their visions for revitalising town and city centres from the damage arising from the pandemic.

Daniel Johnson, finance spokesperson for Scottish Labour, called for a “root-and-branch” review of business rates, which followed a manifesto pledge made by his party earlier in the day for the introduction of an “Amazon tax” to reflect the rapid growth of online retailing in the last year.

Business taxation, the climate emergency, austerity and how candidates would prioritise their relationship with business if elected were among the numerous other issues debated at the virtual event, hosted by the Confederation of British Industry (CBI) Scotland and ScottishPower.

Scottish independence has been at the centre of campaigning for the Scottish Election on May 6, amid the expectation that First Minister Nicola Sturgeon will seek a mandate from Boris Johnson to hold a referendum if her party wins an outright majority at the polls.

Kate Forbes, Cabinet Secretary for Finance in the Scottish Government, told the hustings that Scotland would have a democratic right to demand a referendum in those circumstances, and was backed by Patrick Harvie, co-leader and economy spokesperson of the Scottish Greens. However, their view was countered by Katy Gordon of the Scottish Liberal Democrats, Maurice Golden of the Scottish Conservatives, and Mr Johnson of Labour, who argued the main focus for the next Scottish Government should be on the economic recovery from the pandemic.

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Asked how the political parties could ensure the uncertainty over Scotland’s constitutional future will not deter investors and hamper the economic recovery, Ms Forbes suggested change is inevitable in the aftermath of the pandemic.

“Either way, whatever we believe about Scotland’s constitutional future, we are going to have to do things differently. The question is, how do we ensure Scotland’s economy is best-placed to deliver the potential of those opportunities?

“I think Scotland can do much better, closely linked to the rest of world, building stronger links with our closest friends and allies, by doing things differently with all the powers that we need here in Scotland.”

Pressed by event host Bernard Ponsonby on whether investors would be deterred in the event of a “constitutional crisis” after the election, which would occur if the SNP wins a majority of seats but is denied a referendum by the Westminster Government, Ms Forbes said: “There is a duty to ensure we all honour the democratic mandate that will have been delivered by the people of this country. We recognise democracy.”

But Mr Golden countered Ms Forbes’ position, stating: “I fully agree that the SNP’s approach on the constitution is deterring business, is not good for our economy and indeed is not good for our communities. Hatred and division need to be left in the past.”

Ms Gordon noted that “there is a reason our slogan for the Liberal Democrats in this election is “put the economy first”, because it is fundamentally not about putting independence first.”

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She said: “Of course businesses are going to be affected in terms of whether they want to invest or not when there is such massive uncertainty. We only have to look at how business investment was reduced or held back in the run-up to the EU referendum, then in the run-up to Brexit actually happening. Businesses are struggling to cope with that as it is.”

But Mr Harvie hit back, stating: “I don’t see any evidence that there was any great negative impact on the economy from 2014. I do see that in relation to 2016, both in the anxiety before it and in the reality of what has happened after the Brexit referendum.” Mr Johnson, meanwhile, responding to a question from The Herald on what plans parties have for rejuvenating Scotland’s battered high streets, said: “There are certain types of business who are not going to bounce back, and I think [for] many on the high street that may be the case, but I think we need to give them every opportunity to do so.”

He noted that Labour was proposing a high street voucher for everyone to stimulate spending and called for comprehensive review of business rates, amid a broad consensus that the current system was out of date.

“We do need to look at non-domestic rates,” Mr Johnson said. “The balance is out of kilter, and we do need to look at ways that we can tax more fairly online sales.”

Asked how business rates should be changed, Mr Johnson said the system “needs a root-and-branch review,” adding that the issue should be “put out to an expert group”.

Mr Golden agreed with calls for a review, stating the system was “no longer fit for purpose”, and suggested planning changes, for example to allow businesses to expand into outdoor areas, as well as the removal of some car parking charges in town centres.

Mr Harvie called for smaller, independent businesses to be given a chance to thrive, and for the dominance of a handful of major players to be lessened.

“They are suffering unfair competition from the big giants, whether it is the massive retailers [or] whether it is the big big box companies that very often use tax havens to extract their profits and minimise their contribution to the public purse,” Mr Harvie said.

Ms Gordon suggested decentralising enterprise advice and support, giving local authorities “more power to reshape their city and town centres” alongside local businesses groups.

She added: “It is crucial we look at the burden on high street retailers compared to online.”

Mr Harvie and Mr Johnson said their parties could not guarantee businesses would not have to pay more in tax during the life of the next Scottish Parliament.