Comment: Scotland’s Welfare State of mind

Children on a fairground ride at Glasgow Green in the 1950s. Picture: Contributed
Children on a fairground ride at Glasgow Green in the 1950s. Picture: Contributed
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SCOTS treasure healthcare and benefits, but the independence debate asks us to examine that ‘birthright’, and ask questions, write Iain McLean, Jim Gallagher and Guy Lodge.

Britain is often described as a welfare state, and so it is. State provision for many aspects of life is indeed available “from the cradle to the grave”. Scotland has been an integral part of the UK welfare state since it was founded. Scots have paid into the National Insurance fund, and into general taxation, and taken pensions and benefits as they became entitled to them.

An independent Scotland would no longer be part of the British welfare state, and would make no contribution to it through taxation and, after any transitional arrangements had been made, Scots would receive no benefits from it. Benefits for people living in Scotland would be the responsibility of the new Scottish state. Whether they were more or less generous would depend on the decisions of an independent Scotland, and on what it could afford.

A more complex question is whether there is scope for devolving further aspects of welfare within a continuing UK.

Would it matter in the UK if pensioners in Scotland were paid more generous pensions than those in England? Or if unemployment benefits were higher in London than in Dundee? The answer is: it might, but that depends on the wider set of beliefs about community and solidarity that people might have – what is the role of the Union and the extent of devolution? Should there be limits to variations in policy outcomes by territory, so that the commonality gives meaning to an overarching sense of British community? Or should welfare policy vary from one part of the UK to the next in line with the differences in preferences that Scottish, Welsh or Northern Irish communities have, as expressed through devolved democratic processes?

In our book, published yesterday we look at these two accounts of the Union, which we refer to as “welfare unionism” and “welfare nationalism”, exploring both their strengths and weaknesses, before considering what UK citizens think of these debates.

The Calman Commission, set up by Labour, the Tories and the Liberal Democrats in Scotland and which published its final report in June 2009, provides the clearest exposition of the welfare unionist position. Not only did Calman put forward some important options for strengthening the powers of the Scottish Parliament, it also emphasised the need to protect a number of shared UK-wide entitlements as part of what it called a “social union”.

This term is really a new name for an old idea. The old idea is that the people and nations that comprise the United Kingdom benefit from being able to pool resources and risks across a larger and more resilient political and economic community. This can be seen, operating in both directions, in Scotland’s history. Scotland has in recent decades benefited from relatively high levels of welfare spending from the UK pool. But, similarly, oil revenues from what would be Scottish waters contributed very substantially to that UK pool during the 1980s.

For welfare unionists the essence of the Union is a belief in maintaining the UK as the principal sharing community with UK benefits paid for out of UK taxes and allocated according to some measure of need. Such a position is perfectly compatible with enhanced devolution (as evidenced by Calman) but there are limits: it has no truck with those who advocate devolving the redistributive aspects of the welfare state. To do so would, in the words of Calman, “break the bonds of common social citizenship”.

Welfare nationalists believe that the Scottish nation should be the main sharing community. Many believe that devolution has allowed Scots to pursue a more distinctly Scottish welfare approach with greater emphasis on universalism than that in England. On this reading, nations within the state are perceived as a better place for guaranteeing social rights than the state as a whole. Some would argue that Scottish support for devolution in 1997 was based on a desire of Scots to insulate themselves from UK governments which did not share Scottish traditions of social solidarity.

So welfare nationalists challenge the idea that social rights have to be the same across the state, instead they should differ where values differ. This is to assume that there exists a distinctive welfare model that reflects traditional Scottish – and by implication not British – values. However, the differences between political elites north and south of the Border are not so obvious at the popular level. Public opinion research suggests that the Scots and the English are not very different at all when it comes to support for means-testing, equality and redistribution. At a practical level, it is also to assume that welfare benefits would be paid for out of Scottish taxes, importing risks which could raise some tough choices for a devolved Scottish Government confronted with a rising welfare bill. How are these polarising perspectives on social citizenship reflected in the views of the public? The data gives some support to both welfare unionists and welfare nationalists: there is evidence to suggest that Scots increasingly see Scotland as their “sharing community”: the community to which they are most attached and which they believe should exercise responsibility for policies that shape that community, including social security. This challenges the welfare unionist but, while Scots might want powers devolved to the Scottish Parliament, they do not support the idea of policies and benefits varying across the UK. This has been labelled the “devolution paradox” by some academics. It suggests that the challenge for policy makers and political leaders is both to interpret and inform public opinion, rather than blindly follow contradictory poll findings.

International comparisons offer some guidance. In most federal states, even those in which considerable powers are devolved to the sub-state level, social security is typically the responsibility of the central government. In most federations welfare is primarily a national, federal function, and in none is it solely operated at the sub-national level. Even in the most decentralised countries, welfare is at most a shared responsibility. In this sense, the present UK arrangements are therefore typical: social welfare is largely a national responsibility, though sometimes shared with states or provinces.

Internationally, what we see is that states provide welfare for their own citizens, and jealously guard this privilege, for example in the European Union context. This is partly because providing social welfare is not just a function of the state, but a way of binding it together. In Britain after the Second World War, the creation of universal welfare was very much a national project. So deciding on welfare is not just a practical, utilitarian calculation about risk pooling or resource sharing. It has an emotional dimension, too. Belonging and sharing march together. We are more willing to pool resources with those with whom we have a common bond of identity or citizenship: but sharing risks and resources is one of the ways of creating that common bond.

Nationalists, understandably from this perspective, will press for sharing resources and a community of solidarity at a purely Scottish level. For those who want to emphasise a continuing British identity, a pooled welfare system will be a powerful tool to demonstrate that this identity is real.

Scottish identity has increased in salience in recent years, and more Scottish residents are likely to see themselves as more Scottish than British than in the past. It may be that the UK is becoming a less homogenous society, and this could be reflected in greater sharing of power for welfare. But any such scheme would have to be carefully constructed to be financially and operationally stable. It will be of little comfort to Scots, if welfare provision fails, to be told that it nevertheless reflects their Scottish identity. This suggests any changes are likely to be incremental rather than radical. Those who seek radical change in this area will no doubt argue for independence.

• This is an extract from Scotland’s Choices: The Referendum And What Happens Afterwards, written by Iain McLean, Jim Gallagher and Guy Lodge is published by Edinburgh University Press, price £12.99. Copies can be ordered direct by phoning 0131-650 4218. Iain McLean was a member of the independent expert advisory group to the Calman Commission. Jim Gallagher was secretary to the Calman Commission.