Monday, April 03, 2006

The lessons of Scottish devolution

Scotland seems a nice place to live, says Tony Ferguson on his blog Ballots, Balls and Bikes.

Indeed it does, but I am interested in some of the examples Tony gives:

Tuition fees were abolished in Scotland.

Free personal care was introduced for the elderly...

Now they are intoducing (sic.) free eye tests and have a plan to introduce free dental checks next year.

And even more interested in his explanation of why Scotland enjoys those benefits:
Yes I know the answer about devolved power and the Lib Dems being part of the administration and the sort of policies we have been pushing but I guess I just wish we could get some common sense into English politics and start delivering some improvements in the quality of life for people down south.
I wonder how much any of these benefits has to do with devolution, common sense or even Lib Dem influence. I suspect they owe more to the fact that the British government treats Scottish voters far more generously than it treats English voters.

A report in The Scotsman last December revealed the extent of the generosity:

In its annual survey of the Scottish economy, the Executive said the government spent £45.3 billion in 2003-4, putting Scotland in a rare club of countries where state spending is more than half of the entire economy.

But only £34 billion was generated in tax. This leaves an £11.3 billion gap, which has to be filled by tax collected in England, as Wales and Northern Ireland are also heavily subsidised.

So that is why Scotland enjoys all those benefits. It is not down to devolution, common sense or the Lib Dems. It is down to hard cash.

Labour brought in devolution because it feared the rise of the SNP, not because of any romantic attachment to Scottish nationalism. (Socialists are instinctively on the sides of the big battalions and small nations are generally in the way of history.)

The tactic seems to have worked, but we should not forget that the Scottish assembly was designed as a way of maintaining the Union. And Scotland relies heavily upon the Union for its prosperity, as the figures from The Scotsman remind us. It is a tribute to generations of Scottish politicians that their country has enjoyed such generous treatment for so long, but you have to ask whether this settlement will be sustainable for much longer.

What all this means is that there is no simple way of transferring the Scottish experience to the English regions. The money would not be there to fund Scottish levels of spending. Local control is a good idea for all sorts of reasons, but it cannot produce new funds out of thin air.

The Scottish Liberal Democrats have done wonderfully well. They have become part of the Executive at Holyrood, yet they are also the major beneficiaries of dissatisfaction at Labour's record there. I wonder if they entirely know how they have done it themselves.

If there something to worry about in all this, it is that the Scottish experience has encouraged the Liberal Democrats to see themselves as the party of public services. We are the party that offers more services than Labour - even if we are rather vague about how they are to be paid for.

At the same time, we have gone rather quiet about our support for liberty. You might expect that a government with Liberal Democrat participation at Holyrood would be cooler about the more Nannyish elements of the New Labour project that the Westminster government it. Yet, if anything, Holyrood is keener on them.


Anonymous said...

The transfer of funds from south to north of the border is, in many Scots' eyes, not too much and not too early. Recent revelations about the difference in economic viability of an independent Scotland with access to oil revenues thirty years ago could have put us in the delicious position of assisting the other partners in this united kingdom with money as well as political leaders.
Sure, this is a complex debate, but having recently moved from England to Scotland, one of the reasons I chose to make the move was that I wanted to live in a country less constrained by the Whitehall mentality than an England without its own parliament. Wales and Northern Ireland have both achieved many new and creative works with devolved administrations and Scotland is in the position to make choices for itself in most fields of public life.
If you are concerned about costs, just think how much we will save the public purse in years to come from the reduction in smoking-related illness and early death.

Tristan said...

This is my concern.

I am very nervous about being the party of 'public services'. It sits uneasily with political and personal liberalism.
The goal should not be to provide services, but to enable service provision.

I also worry as its me and my generation paying for all this whilst being told we must save for our own future as this is unsustainable.

Again, I agree there does seem to be some movement away from promotion of liberty and movement towards a more nannyish outlook (a danger which is always present in liberal parties...)

cymrumark said...

The original article spouts the same old nonsense about tax etc. This is because the Tax revenue from North Sea Oil is counted as coming from "London" as opposed to Edinburgh.

The same mythology is used about Wales. At the time of the Assembly referendum the westminster government calculated there was £15 billion public expenditure in Wales and only £11 billion tax income. However this excluded the "Welsh" share of corporation tax, Vat and Excise duties. I suspect the scottish figures do the same ....another dodgy unionist trick....

Anonymous said...

Leaving aside the can of worms that is Scottish North Sea Oil revenue - there is something going on that is distinctively fishy going on that is not entirely correct - the Scotman states that

"In its annual survey of the Scottish economy, the Executive said the government spent £45.3 billion in 2003-4, putting Scotland in a rare club of countries where state spending is more than half of the entire economy."

Not so. Buried away in the financial legislation that dictates the spending of the Scottish Parliament is a small piece of political dynamite. The Budget (Scotland) Act 2006

states that the resources of the Scottish administration are £25,463,337,000, plus one or two further (minor) expenditures on bureaucracy. Oh dear, not quite the £43bn that is touted - either that or Scotland has just had a major spending cut.