Archive: fiscal-autonomy

Last week the SNP set out its legislative plan. The headline grabber was the long-promised independence referendum bill. Today I saw Caron’s post asking, “why bother with a referendum?” She has a good point. It is widely recognised that the result of any referendum would almost certainly reject the SNP’s favoured proposals.

“Ah, but!”, say proponents of a referendum. Opinion polls consistently suggest that around three quarters of people would like there to be a referendum on independence. This is supposedly a good enough reason to actually hold a referendum.

It strikes me as a bit daft though. Imagine the scene. You’re sitting on a park bench eating your lunch. A chap with a clipboard approaches you. He’s from a polling organisation. “The Monster Raving Loony Party,” he begins, “plans on giving everyone a slap on the face.” Your eyebrows raise. The prospect of the Monster Raving Loony Party being in a position to give everyone a slap in the face feels a bit distant. But the pollster continues: “Would you like a referendum on face-slapping to be held before this policy is pursued?” Yes, of course, you reply.

Of course people say they’d like there to be a referendum. If you asked people if they wanted a referendum on legislation about chewing gum wrappers, they would most likely say yes. In fact, I wonder what is going through the minds of the quarter of people who say they would not like a referendum. They probably can’t be bothered with the campaigning. Perhaps they dread the prospect of politicians hogging the box, or maybe they think their vote isn’t worth anything.

Nevertheless, in general, ask people if they would like a right, they will take it with both hands. The right to vote on Scotland’s constitutional future is appealing. But it is just one appealing thing out of an infinite number of appealing things that may be offered by a government. We have unlimited wants, but the government has limited means.

That is the essence of the argument put forward by those who would rather there wasn’t a referendum on independence. Opponents such as Alistair Darling say there are more important issues facing the voters, not least the economy. It would be wise to tackle them first before concerning ourselves with “distractions” like the independence debate.

I don’t quite agree with that perspective either. It is perfectly valid (though, in my view, incorrect) to say that economic and other woes may be fixed by Scotland becoming independent. In fact, I think it is quite dangerous to dismiss any analysis of the constitutional position as a “distraction”.

I am in favour of constitutional reform. I do not agree with the sort of extreme reforms that the SNP would like to make. But certainly I would favour some degree of fiscal autonomy. I would like the UK to adopt a federal structure. And I think there is a pressing need for reform of the voting system.

I do not support such reforms because I think it would be a bit of distracting fun. There is nothing particularly satisfying to me about the calculations the single transferable vote system would entail (though it might be another matter for some political geeks). No, the real reason I favour constitutional reform is because I believe it will fundamentally improve the governance of the country. To dismiss constitutional debates as “distracting” is a bit of an insult. The constitutional structure is fundamental.

The reason to oppose a referendum on independence is not because people don’t want a referendum. And it is certainly not because it is a distraction. The reason is simply that there is no appetite for independence.

Some people have a peculiar obsession with referenda. But it’s worth remembering that they are actually quite a recent addition to British democracy, and have only been used a handful of times. The UK’s first referendum was held in 1973. Since then, a further eight have been held. Only one of them was held across the UK. Only another two have been Scotland-wide.

The idea behind holding a referendum is to make bloody well sure that the major constitutional change which is proposed is actually favoured by the people of the country. So rather than having a mere parliamentary majority, you make sure there is a majority favour among the people too. If you like, a referendum seeks a second mandate to go ahead with the change.

You see where I’m going with this? There hasn’t even been a first mandate yet. Although the SNP forms the Scottish Government, it is a minority administration. A majority of MSPs oppose independence.

You cannot even convincingly argue that the 2007 election result demonstrated momentum towards MSPs that favour independence. Although the SNP made large gains, this was mostly at the expense of other parties that favour independence. The Greens had their representation cut by two thirds. The SSP were totally wiped off the map. These two parties saw their share of the vote cut more than any other parties. Meanwhile, the three main opposition parties saw stagnant levels of support — they dropped, but not by that much.

That is why I oppose the idea of holding a referendum on independence. There simply isn’t anything going for it. There is no groundswell of support for independence among the voters. And there certainly isn’t enough appetite for it within the Scottish Parliament.

Those in favour of a referendum cling on to the fact that most people would like there to be a referendum. But that in itself is pretty meaningless because, as I have said, people will always prefer to have a referendum on anything, even if it’s on getting a slap on the face.

Common ground on Scotland's future

A series of posts

  1. Finding the common ground
  2. My view on Scotland’s constitutional future

In the wake of Kezia Dugdale’s retirement from blogging, and having noted the often poisonous atmosphere that pervades some of the darkest corners of the Scottish blogosphere, I think now is a good time for me to come out with an idea that has been floating around in my head for the past few months.

This is an attempt to find the common ground in the constitutional viewpoints of SNP supporters and those of other persuasions. It recently struck me that we all have much more in common than we perhaps imagine.

The eureka moment came after I had a discussion in the pub with a card-carrying SNP member and full-on nationalist. We both sought to gain a good understanding of each other’s views and as the conversation went on we found that we had a lot more in common than we felt at first glance.

I set out my federalist position, using the opportunity to point out that the SNP, too, shares my view that having different powers at different levels of government can be a desirable thing. For instance, it is well-known that the SNP would wish for an independent Scotland to be a member of the European Union.

Furthermore, under current SNP policy, a very important policy instrument would never be controlled by Scotland. The SNP recognises that Scotland is not an optimal currency area, thanks to the large amount of trade Scotland does with the rest of the UK and the rest of the EU. Most likely, an SNP-designed independent Scotland would continue to use sterling in the short-to-medium term while adopting the euro in the longer term future. This means that monetary policy would be set either in London or in Frankfurt, not Edinburgh.

Already we see that the independence issue is not so black-and-white as some of the debates might lead you to believe. The SNP do not support full independence. I am sure that there are some people on the fringes who do, but they are thin on the ground and are certainly not represented in mainstream politics.

That means that there is not actually a great deal that separates the SNP from the ‘unionist’ parties. All of the major parties believe a similar thing. Admittedly they do so to varying degrees. At one end we have the Labour and Conservative position of maybe considering a greater degree of fiscal federalism. At the other, we have the likes of the Greens who want more powers for local government in addition to the Scottish Parliament. And the Lib Dems have long supported federalist solutions.

From my perspective, this is actually pretty damn close to being a consensus in Scottish politics. The introduction of a Scottish Parliament was almost seen as a given in 1997, but even then the Conservatives had a good bash at running a ‘no’ campaign. Were there to be a referendum on having increased fiscal powers for the Scottish Parliament a few years down the line, surely any ‘no’ campaign would be a pathetic laughing stock. Certainly, anyone calling for the abolition of the Scottish Parliament would be totally ignored.

It seems to me that most people now have very similar viewpoints on Scotland’s near-future constitutional direction. The differences are almost a matter of semantics, or at least of niggly details.

That was the conclusion I came to in the pub during this discussion. My nationalist sparring partner, if I understood him correctly, was more or less saying that once Scotland had fiscal powers it was more-or-less independent enough anyway. He was telling me, as a Lib Dem sympathiser, that given this huge amount of common ground the Lib Dems ought to be working with the SNP to try and advance these ideas.

In May 2007 I understood and supported the Lib Dems’ decision not to go into coalition with the SNP. There was a damaging perception that the Lib Dems would just get into bed with anyone so it was a good idea to try and put the lid on that. The flip-side, though, is that the Lib Dems are beginning to like an appendage of the Labour Party — and this isn’t the time to be that.

Worse still, particularly given the large amounts of common ground between the SNP and the Lib Dems on a variety of different issues, the Lib Dems are beginning to look like the sulky party. I am starting to think it would be much more constructive for the Lib Dems to start working with the SNP. Of course, given the relative success of the SNP minority administration so far, it wouldn’t be surprising if the SNP just thumbed their nose at any Lib Dem approach.

All-round, it is beginning to look like a huge missed opportunity. That underlines why I think we need to start focusing on the common ground rather than the minor differences and the petty squabbles.

Scotland sorely needs a proper national conversation right now. Unfortunately, the way things have worked out, we are having two conversations in tandem and the risk is that everyone is just preaching to the converted without actually taking in what ‘the others’ are saying. It’s not very constructive.

I think if everyone ditched the political posturing and the party rhetoric, the politicians and the people would probably find a lot to agree with. Am I right, or do you think I’m being a bit wide-eyed and naive? I want to try and find out.

Here is what I propose. As a starting point, I am going to ask if everyone believes that different powers should be held at different levels. This could be Scotland as part of the EU, Scotland as part of the UK and the EU, or whatever other permutations you care to come up with. I have already noted that I think almost everyone agrees with the principle of this. Am I wrong?

Once we get past the first hurdle, I want to understand why people believe that certain powers should be held by certain institutions. What powers should the Scottish Parliament have? In which areas would it be acceptable for Westminster to retain control? What would be the ideal role of the EU? If you think Westminster should be taken out of the equation completely, what is the reasoning behind that? I don’t necessarily want this to be a game of ‘fantasy constitution’. I’m only interested in realistic ideas.

I’ll post what I think the answers to these questions are within the next day. I hope some other bloggers join in so that we can see where we all agree and get a proper handle on where the disagreements come from.

Reflections on Glasgow East

A series of posts

  1. The Labour and Liberal Democrat dimensions
  2. The SNP dimension
  3. The Conservative dimension

To the extent that the SNP’s current electoral popularity is due to pro-SNP (rather than anti-Labour) effects, it must be remembered that there is much more than independence at play. Does an SNP success in an election mean that Scotland has suddenly converted to the cause of independence? Of course not.

Firstly, support for independence is pretty low at the moment. According to the 2007 Scottish Social Attitudes Survey (which I believe asks a question about independence every year), support for independence (PDF link) was lower than it had been since May 1997. Asked to choose between independence, devolution or getting rid of the Scottish Parliament altogether, just 23% plumped for independence.

The peak of support for independence was actually in September 1997 — ironically, also roughly when Labour were also at the height of their powers. Then, independence was favoured over devolution for, as far as I can tell, the only time in history. Over the preceding decade support for independence has flitted up and down but has been in a pronounced decline since 2005.

Another point to note is that this, the SNP’s most successful period ever, has come at a time when the SNP has played down its support for independence. Take the slogan it has used since last year’s election campaign. Instead of things like “Michty me, we’ll soon be free” and all that sort of thing, their slogan was: “It’s time.” Time for what? Time for bed? The SNP don’t say.

You have to admit, it is a fiendishly clever slogan. Classic dog whistle stuff. So SNP activists and hardened advocates for independence think it’s time for independence. Anti-Labour voters see it and think it’s time for a change, time to kick Labour out. In fact, it can mean whatever you want it to mean.

Crucially, the independence issue was not rammed down people’s throats by the SNP. Given the closeness of last year’s election, that could well have been what swung it for them.

You should also bear in mind that the SNP are very far away from being a single-issue party. A vote for the SNP is not necessarily a vote for independence, and often an SNP activist will be the first person to tell you this. For instance, Richard Leyton got this line from no less a person than Nicola Sturgeon.

Don’t want an independent Scotland? It doesn’t matter. The SNP have made it very clear that independence will only come after a referendum victory. In the meantime, there is a “national conversation” about independence where you can express your views if you so wish. In effect, the SNP have tried as hard as possible to divorce the independence issue from Scottish Parliament and Westminster elections. The debate over independence now runs separately.

So what explains the SNP’s success? It’s the policies stupid. It is conceivable that Fifers who voted for the SNP did so because they were enticed by their promise to abolish the bridge tolls. Students may have been attracted to their promise to “dump student debt”. And of course, the people who felt that there should be a change in government were always likely to vote SNP because they are the second largest party in Scotland, and the only party in a position to stand up to Labour.

It must also be said that Alex Salmond’s leadership has a lot to do with the SNP’s current success. Yes, he splits opinion. But like him or loathe him, you have to admit that he is a great politician. He is good orator and has the charisma and leadership qualities necessary. The only other Scottish leader that can compare to him in my book is Annabel Goldie, and even she is pretty colourless compared to Alex Salmond.

Particularly when you compare him to the likes of Nicol Stephen and Jack McConnell, who both look permanently nervous, Alex Salmond towers above everyone else in the Scottish Parliament. Wendy Alexander was no match for him either, particularly given the state of disarray Labour are in at the moment. With Alex Salmond at the helm, the SNP should expect an upswing in fortunes, especially since their leader at the 2003 Scottish Parliamentary election was the dull and ineffective John Swinney.

Back in Glasgow East, from what I gather, the issue of independence was not completely ignored, but it certainly did not form a major part of the campaign. Instead, it was presented as a contest where the electorate would pass judgement on the records of the Labour Government in Westminster and the SNP Government in Holyrood.

The SNP were also hugely advantaged by the fact that they were already in 2nd place in the constituency. If my theory about whichever party being in a position to beat Labour will win is correct, then it is no wonder the SNP did well while the Lib Dems tanked.

Most votes are wasted anyway, especially under the FPTP system. But a sure-fire way to waste your vote in Glasgow East was to vote for the Conservatives or the Lib Dems. Only hardened Tories and Lib Dems who despise Labour and the SNP equally will have voted for them (or, indeed, any of the other smaller parties).

In summary, I think that the SNP’s victory in Glasgow East means almost nothing for the union.

That is not to say that I think that the status quo will prevail. I think I am right when I say that all of the parties currently represented in the Scottish Parliament, and the largest parties that are not represented in the Scottish Parliament, all support some kind of increased devolution to varying degrees. That includes the Conservatives, who appear pretty open to the idea of the Scottish Parliament having some leverage over fiscal policy.

Even Labour, painted into a unionist corner by their opposition to the SNP, have toyed with the idea of fiscal autonomy. Mind you, that was under the leadership of Wendy Alexander, who seemed to be a bit of a loose cannon when it came to trying to tackle the issue of the constitution. Who knows what direction Labour will take under their new leader, but I suspect that they will find it difficult to maintain support unless the take the majority view that the Scottish Parliament should have a greater degree of fiscal autonomy.

All of this, though, is almost incidental to the success or otherwise of the SNP. Increased powers for the Scottish Parliament will not come about as a result of SNP success. It can come about as a result of the success of any party.

This is the post about independence that I have been threatening to write for months.

I am seriously considering voting SNP at this year’s Scottish Parliament elections. But I will probably stand in the voting booth thinking long and hard about it, with my hand quivering. And it will definitely be only for the constituency vote — purely as an anti-Labour tactical vote. The SNP are in the second place in my constituency. I’ll see how the local campaign pans out, but for the time being, voting SNP is the only (slim) hope of booting Labour out of Kirkcaldy.

However, I normally wouldn’t vote SNP. Yes, they are probably in my eyes the second least-worst party, but that says more about the shoddy state of political parties than anything else.

There has been an awful lot of talk about independence in the past few months and I wouldn’t blame SNP supporters for getting carried away. I said a few weeks ago, though, that I thought there wasn’t really a proper debate on independence. For most people it has just been an issue that’s been there for decades. As such, it doesn’t get tackled properly by anybody on any side.

Take, for instance, the SNP’s astonishing reliance on oil. Unbelievably, this still sits at the heart of SNP ideology. It is an argument that might have been convincing in the 1970s. But it should have stayed in the 1970s.

Economic report after economic report rubbishes the SNP claims that oil would keep Scotland’s economy afloat. Surely even the most blinkered nationalist has to realise that the oil argument is in trouble when the SNP’s rebuttal to Professor Arthur Midwinter’s report is to cite the GERS report which said much the same thing!

I don’t know about you, but usually when two studies come to broadly similar conclusions — and conclusions that are supported by the majority of fiscal policy experts — I take that to usually mean that there might be something in those conclusions.

The joke normally goes that if you have two economists you get three different opinions. Here we have economist after economist lining up to give the same opinion — that the oil argument is a complete red herring.

The fact that the SNP are left pointing out differences in the size of estimated deficits is telling. The fact is that these estimates are both deficits. Whether it’s £11 billion or £4 billion, it’s a lot of money to be chucking down the chute.

Meanwhile, the reaction from the nationalist commenters on the Scotsman.com website speaks volumes about how much the average independence supporter actually cares about economic arguments, with such incisive gems as:

I got as far as paragraph three….zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

Putting aside arguments over balancing the books, for an independent Scotland’s economy to rely almost solely on oil would be incredibly dangerous. I say “almost solely”, although I’m sure most nationalists would soon be able to pull all sorts of other things out of the air that provide “evidence” of how much Scotland’s economy is superior to the UK’s. But why do we never hear as much about these?

The SNP acts as though oil is a panacea to all of Scotland’s economic ills. But you have to be burying your entire body in the sand to believe that it actually would be. An economy that relies upon one single industry — one single natural resource, indeed — is a very unhealthy economy indeed. It’s called putting all your eggs in one basket.

So what happens when the oil runs out, which is bound to happen within a matter of decades? North Sea oil production has already halved in just the past eight years. Since Scotland will have lost its biggest argument in favour of independence within a matter of a few decades, I suppose it will be time to sign a second Act of Union in 2050?

You want more? Let’s leave the economy completely out of the equation. How about the environmental effects? The SNP touts itself as a green party. Yet at the very core of its ideology sits a love of consuming oil. Exactly how environmentally friendly is that? Ryanair would have a more convincing claim to be an environmental group.

Below I have written two lists. The first list is of things we know about oil for a fact. The second list is of things that we just don’t know about oil.

List 1:

  • Oil is a finite resource and is bound to run out sooner or later — we know this for a fact
  • Oil markets are highly unstable and prices fluctuate wildly — we know this for a fact
  • Oil extraction causes pollution and oil consumption is a major contributor to CO2 emissions — we know this for a fact

List 2:

  • Will North Sea oil be enough to plug an independent Scottish government’s budget deficit? — we just don’t know, although the evidence strongly suggests that it wouldn’t

I really don’t understand why the SNP isn’t picked up on this more often. This is a raging, gaping hole that sits at the very core of the SNP’s plans. Moreover, the fetishistic love of oil is at odds with the SNP’s desperation to present itself as environmentally-friendly. And here we sit considering the possibility that they might be in charge come May.

But oil is not my only beef with independence. The main reason why I don’t support nationalist movements of any form is that I just don’t believe that it matters where you are governed from. What matters is how you are governed.

I once read an SNP supporter say that a unionist criticising nationalism is a hypocrite because while a supporter of Scottish independence is a Scottish nationalist, unionists are British nationalists. But this is nonsense. I am not a nationalist of any sort. I don’t have to be “proud” of Britain to recognise that the Union works by and large.

I find it difficult to be proud of Scotland. Being proud of the country in which you are born is as bizarre to me as being proud of this week’s lottery numbers. I certainly have a love of and affinity with Scotland. But I recognise that this is only because I was born here and all of my memories are from here. If I was born in any other country I would love that country also. That is why I can’t be proud of my nationality.

Moreover, while there are many parts of my culture that are derived from Scotland, it is not difficult to find the influence of Britain. It is no inconsistency to say that I feel equal parts Scottish and British, and even European. I find the idea that I cannot be both, or that I somehow have to choose between them, offensive.

And I should make clear here that I am not in favour of London having all of the power. I am a federalist. I was in favour of devolution. To me, it makes common sense for national issues such as defence to be controlled at one level and for issues such as education and health to be controlled by a more local level, just as most people believe that the council is the right body to arrange rubbish collection.

I am also in favour of greater fiscal autonomy. Perhaps the biggest problem with the Scottish Parliament as things stand is that it does not have the responsibility to raise the tax money that it spends. I was struck by an article in The Economist which said:

Holyrood’s politicians… do not, however, suffer the discipline of having to raise their revenue themselves: they are like teenagers on an allowance. And they have no incentive to promote economic growth through taxation.

The Scottish Parliament has only a piddly power to vary tax levels by ±3%, and it is too scared to even use that. The Scottish Parliament needs to mature. Greater fiscal autonomy would allow this to happen.

But that does not mean that we should leave the United Kingdom. It is crazy that in an increasingly globalised world that we should consider building a barrier. And let’s face it, if drawing a boundary isn’t designed to build a barrier, what is the point?

By now some nationalists will be shrieking, saying things like, “Look at Ireland!”, or, “Imagine if Norway wasn’t independent!” Norway is a favourite example of everybody who wants to advocate a certain policy. I remember a few years back David Farrer praised the prosperity of Norway, suggesting that it might be because it was outside the EU. Though I doubt Farrer would be too quick to praise Norway’s generous welfare system.

Whatever the causes, Norway apparently does well for itself. Nationalists believe that this is because it is independent. The thing is though, we already live in an independent country. It’s called the UK. This brings me on to a point that I have never heard a supporter of independence adequately respond to:

The relevant question isn’t, “Why should Scotland be independent?” The relevant question is, “Why should Scotland be independent?”

What is so magical about Scotland that it should deserve to be independent? Scottish nationalists know full well that if Scotland were to become independent, that wouldn’t be the end of the debate. It would probably just mean that the Orcadian nationalist movement would stamp its feet more loudly.

Maybe Aberdonians would start an independence movement on the basis that “It’s Aberdeen’s oil”. And who would blame them? After all, surely even Newcastle has a stronger claim to North Sea oil than, say, Stranraer.

Latching on to words like independence and freedom tugs on people’s heartstrings and gets people heated. But it ignores one vital thing: we are not oppressed. And if we are oppressed, it isn’t because we are ruled from London.

And this brings be on to yet another bugbear of mine about the independence movement. Nationalists often make the claim that Westminster politics is corrupt and that the only solution to it is for Scotland to become independent. But we are talking about politicians here. It is every bit as conceivable that an Edinburgh-based administration would be just as bad (or good) as a London-based one. As I said before, what matters is not from where you are governed, but how well you are governed.

Just moving Scotland’s politicians from one building to another won’t make politics any rosier. And in case you need reminding, the shitbags that currently run Westminster enjoy their greatest concentration of support in Scotland. As we Scottish bloggers have been noting recently, that support is too unquestioningly loyal.

And while I believe that the claims that there is a “Scottish Raj” are overstated, it is difficult to ignore the fact that the Prime Minister and the Chancellor of the Exchequer were both born in Scotland, and there are more Scottish cabinet ministers. It hardly fills me with a great amount of confidence that an independent Scotland would have inherently better politics.

I could actually go on, but for the good of my readership and my page load times I’m going to call it a day there. But to think that this is the party that I’m actually thinking of voting for. At the risk of sounding like Polly Toynbee (please, no!) I’ll have to get the nosepegs out.