YOU may have missed it with everything else going on, but Scotland last week acquired a new Board to accompany a new Strategy, two commodities with which any reasonable person might think we are already awash.
However, in a land where nothing much changes, you can never have too many Boards or Strategies. And so it is that the National Strategy for Economic Transformation will be accompanied by its very own Delivery Board, co-chaired by Ms Kate Forbes and a chap who “has held senior leadership roles in the private and public sectors”. But this time, definitely not Jim McColl.
As if this news was not enough to set pulses racing, the Executive Summary of the National Strategy for Economic Transformation assures us: “Our ambition for 2032 is for Scotland to be successful”. (Pause, as SNP MSPs clap like well-trained seals).
“Success means a strong economy where good, secure and well-paid jobs and growing businesses have driven a significant reduction in poverty and, in particular, child poverty. It means a nation of entrepreneurs and innovators, with resilient supply chains and competitive advantages … It means a society in which everyone can participate in economic success, in every community and in every region”.
Who can disagree with any of that? In addition, every day will be the first day of spring. The only problem is that this mish-mash of cliches and platitudes is about as far removed from reality as is possible.
It’s delivery that Scotland needs, rather than another Delivery Board.
Could our existing economic development agencies and local authorities not deliver a lot more if they were once again decently funded and given the autonomy to get on with it? How can a Government which has just abandoned even a nominal commitment to closing the shameful gap in literacy and numeracy talk so glibly about “a society in which everyone can participate in economic success”? It is hokum.
The Scottish Fiscal Commission is expected to predict today a £3.5 billion shortfall in the Scottish Government’s revenues, due in large part to a stagnant economy which lags behind other parts of the UK. This suggests it’s not a new Board that’s needed but, after 15 years, a new government which accepts as starting point how far we have fallen behind.
The £3.5 billion deficit is, of course, on top of the gap between what Scotland pays in tax and receives via the UK Treasury which, in pre-Covid times, was running at about £16 billion. One might have thought balancing the books should be possible within these parameters. The fact it isn’t raises profound questions about how on earth so much money is spent, to make so little difference.
“Raise taxes” is the response of those who don’t think they will be paying them. It is one which I would cheerfully endorse if the actual outcome was to reduce child poverty and advance all the other worthy aims. But it isn’t. Indeed, Ms Forbes and her colleagues have managed to turn even tax increases into a deficit for her own budget.
David Phillips of the IFS tweeted: “Despite income tax rises equivalent to £500 million … weak growth in the tax base means revenues will be nearly £200 million lower this year than if income tax hadn’t been devolved.” Get your heads round that one.
The IFS predicts: “The Scottish Government will therefore have to either take the axe to certain areas of spending, signal higher levels of taxation – or ignore the issue for now, hoping for extra funding or borrowing powers from the UK government”. I’ll place my bets on the last of these three options being the preferred one, followed by the usual demands to send more money.
Kicking the can down the road may be understandable at a time when so many households are struggling and need support from all levels of government. But until there is far greater accountability about the “how” rather than the “how much” of public spending, the basic prognosis will only intensify. Vast sums of Scotland’s money are failing to achieve their stated aims, whether it is in education, NHS or economic development.
Ms Forbes is due to set out a Spending Review which will cover the next four years. However, the first purpose of a genuine review should be to look rigorously at how savings could be made in order to use existing money more effectively. Since there hasn’t been a spending review in Edinburgh for ten years, that analysis is long overdue.
The mentality has developed of simply adding to existing expenditure and attacking anyone who dares challenge that mantra. A classic example is the approach to universal “free things” which is held up as progressive politics in which Scotland leads the rest of the UK. However, if “free things” for those of us who can afford to pay for them is at the expense of, let’s say, relieving the shameful attainment gap in education, then there is nothing progressive about it. That is the kind of trade-off a spending review should challenge, but won’t.
There are huge swathes of Scottish Government spending which never come under any serious scrutiny because the silos which surround them are assumed to be untouchable. For example, I was genuinely shocked to learn that £250 million has been allocated to funding peat bog restoration without any regulation to ensure that communities share in the benefits. Ms Forbes could usefully stop that tomorrow and spend the money better.
While local government has seen both revenue and capital budgets cut on a grand scale, there are innumerable “funds” for them to bid into. Why not get rid of the funds and the bureaucracy that surrounds them and allow councils the certainty and resources to serve their communities?
In a genuine spending review, no such question would be avoided and no current assumptions would go untested. That should apply no matter the political complexion of government. The difference with this one is that it always has an alternative option to facing up to its own responsibilities and accepting politics as the language of priorities. It is, quite simply: “Send more money”.
Brian Wilson is a former Labour Energy Minister. Our columns are a platform for writers to express their opinions. They do not necessarily represent the views of The Herald.
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