Scotland has just entered a new era: a world of public spending cuts and job losses after a decade of devolution largesse. In this Scotland is just like everywhere else in the UK; some English and even some Scots people will say ‘and about bloody time too’: it was high time to put a stop to ‘the land of milk and honey’ and ‘subsidy junkie Scots’.
But something much more significant is going on north of the border, which such gut, instinctual views miss. Something that has ramifications for the whole of the UK: the end of devolution as we know it. Devolution was centred on maintaining the internal status quo in Scotland – the Labour extended state - and introducing a little but not too much democracy. Now, without the monies, the whole enterprise is beginning to unwind. However slowly, ‘the Scottish social contract’, as SNP Finance Minister John Swinney calls it, has begun to unravel and lots of the policy decisions which Scots used to pride themselves on, as saying something positive about the kind of society we enjoy, face instead a very uncertain prospect.
John Swinney, Scotland’s Secretary for Finance, has just set out the country’s budget. I’ll come to some of the details in a moment but what the figures add up to is a major challenge as to how Scotland sees itself, what the purpose of the Scottish Parliament, Government and whole devolution enterprise is about, and what kind of future, society and nation we aspire to be.
The prevailing accounts on offer in mainstream Scotland – from the political classes, media and academics – show the same disconnect and partialness as in the rest of the UK and Western world. One in its way devastating example of the decomposition of competence and simply alertness concerns the Scottish Parliament’s tax raising powers. These are small but were the subject of the famed second question in the 1997 referendum and the Scottish people voted for them. But instead of being renewed, really a formality, the SNP-led Scottish Government forgot about doing this. No one publicly knew until now. This kind of system failure points to a culture of decay not renewal.
A brief survey of the main figures: John Swinney’s budget announced cuts of £1.2 billion for 2011-12 in a budget of £28.007 billion. Prisons and housing have been significantly reduced with 22% and 19% cuts respectively; the council tax frozen to offer a more generous local government settlement; health ring-fenced; a public sector pay freeze for everyone earning above £21,000.
This is the first Scottish Government budget in difficult times. It was a cautious, safety-first one: a product and continuation of the Scottish consensus. Speaking on BBC Radio Scotland the morning after with John Swinney was Graeme Smith, General Secretary of the STUC, and Peter MacMahon, of ‘The Scotsman’. The tensions and difficulties of the tightrope that modern politicians have to walk became more than evident. Swinney’s cautious approach irked lots of listeners. Numerous callers were irate about council tax levels and the size, culture and attitudes of the public sector. All the callers were male, most elderly, reflecting the generational issue of people on fixed incomes and the sore point of the council tax: a part of the electorate growing more vocal and who turnout more than anyone else.
The Three Stories of Scotland *
The recent Scottish political discussions leading up to the UK Comprehensive Spending Review and anticipation of the Scottish Budget has seen three views:
This is the view put forward in such documents as Crawford Beveridge’s Independent Budget Review commissioned by the Scottish Government, and lots of experts, academics and consultants – from the David Hume Institute to PwC and KPMG. Namely that Scotland has to revisit its universal benefits, several of the big-ticket items of devolution Scotland, and even sell off some of our public assets.
This is the nationalist perspective – which emphasises that this crisis has not only a global dimension – but a particular British dimension – and is not made in Scotland. The constant mantra of ‘London cuts’ emphasises that all the unionist parties are London focused or controlled. Underneath this is the view that all of these parties are complicit in the crisis in a way the SNP are not: Labour with the Blair-Brown bubble, and the Con-Lib Dem coalition implementing its public spending cuts.
This perspective comes from an older, irate unionist worldview which has always been explicitly anti-Nationalist – and for the idea of Labour – if not always for the party. It rages against the audacity of the Nationalist clarion call of ‘London cuts’ – claiming this is an avoidance of responsibility which attempts to ignore Alex Salmond’s numerous calls for light touch regulation of banks and the financial sector.
None of these are adequate responses for the following reasons:
This refuses to acknowledge that once you give people entitlements – free care for the elderly, abolition of tuition fees, free bus passes – people then start to see them as something that is a right. Taking them away from people once they have got used to them is very different, controversial and potentially unpopular – from giving them. There is also a too powerful one way facing consensus from experts that Scotland has to revisit lots of its universal benefits, engage in selectivity, and sell off public assets such as Scottish Water.
While there is quite a bit of accuracy in this perspective – it is a product of the limits of the devolution settlement and the fact – long predicted that the SNP have been captured and controlled by devolution. Talking all the time of ‘London cuts’ tends to pose a politics of the Scottish consensus, conservatism and received wisdom north of the border – a set of opinions – the SNP has long attempted to court as part of its long-term strategy to woo establishment Scotland rather than threaten it. One problem amongst many with this, apart from its lack of radicalism, is that elements of institutional Scotland are moving firmly into the ‘Firesale Scotland’ camp.
This is as irritating a perspective – which is maybe less directly damaging to Scotland – but which cannot contain its scorn and glee at having such an open flank to attack the Nationalists. They blithely ignore that the banker’s crisis was one of UK regulation, of the British state and British (and indeed Anglo-American) capitalism. Yes it is true that the SNP were blind-sided by the bankers – but they weren’t actually major agents and actors in bringing about this crisis.
Where this takes us is to acknowledge the unsustainable nature of the devolution settlement not just on tax and spend, but across a whole range of powers and responsibilities from regulation to corporate governance.
Who were the authors of this flawed devolution settlement we need to ask? One which while adequate in the good times and sunlit uplands is disastrous and inadequate in the bad times. Why no other than Scottish Labour, led by Wendy Alexander and others, the same people promoting the equally flawed (perhaps more fatally flawed) Calman Commission proposals of partial fiscal autonomy.
The current and forthcoming crisis shows that we don’t have a fully responsible Scottish Parliament and Government: instead have an aspiration and ambition for a real Parliament and Government, but still a high degree of reservation and hesitancy about how to drive them forward and what the consequences might be.
This all amounts to the end of devolution. We can snuggle down to an ever more limited politics of apathy, inertia and status – one represented by institutional capture and conservatism – a politics which can be expressed either in the benign, but unattractive vision of grumpy-old-men-unionist-Scotland or the dogma and zealotry of the outsourced state, in which Scotland plc belatedly joins what the new forces of knowledge, expertise and power like to call the modern world; this would entail joining the Anglo-American order as an outhouse of the British state, just as the whole rotten edifice is collapsing around our heads.
Or we can attempt to navigate a different path and dare to dream of a Scotland which has a fully empowered Parliament and Government along with a wider notion of political and societal power and change that isn’t just focused on politicians.
This will require a second Scottish transformation – even more far-reaching than the one which took us from the stalemate and hesitancy that lost the 1979 referendum to the emphatic support of the referendum of 1997 which now seems so long ago.
* With apologies to Tom Nairn and his ‘Three Dreams of Scottish Nationalism’ in Karl Miller (ed), Memories of Modern Scotland, Faber and Faber 1970.
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