There’s been a lot of 1997 nostalgia around this week and I felt my own little fit coming on when I noticed the venue for Nicola Sturgeon’s latest exhortations on the Scottish economy – Spirit AeroSystems (Europe) at Prestwick.
Back in ’97, I had just become Scottish Industry Minister and the first bit of bad news was that British Aerospace planned to end production of Jetstream planes at Prestwick. The civil service advice was to stand well back and say this was a matter for the company.
I sent back a memo asking if they had not noticed a change of government and advising that this “line to take” was impossible. To cut a long story short, I called Dick Evans – then chief executive of British Aerospace – and we cut a deal. Government would put its weight behind Prestwick and he would find another role for the site.
We set up the Prestwick Task Force which taught me what an effective instrument government can be, when it puts its mind to it. Locate in Scotland scoured the world for companies to strengthen the aerospace hub. New business was brought into the airport. Critically, BAE stayed put – subsequently it was confirmed that prior to that call, the intention had been to pull out completely.
Instead, they are still there employing a couple of hundred people while in 2006 they sold the production business to Spirit, who continue to make Airbus components. It is pleasing to reflect that without some good old-fashioned Labour interventionism by one of these awful governments that did nothing for Scotland (etc etc, ad nauseam), Nicola might have been speaking in an empty shed.
The bottom line of industrial policy is about protecting jobs and contributing to conditions in which they can be created. Often, the role of government in the latter sphere is exaggerated. Most businesses just get on with it. On the whole, governments are more likely to create impediments (think constitutional uncertainty) than facilitate enterprise, while business wants practical support, not fancy rhetoric.
Occasionally, there are huge policy initiatives which make a massive difference, at least on a temporary basis. Labour used to direct major industries into places like Bathgate and Linwood – great while it lasted, but unsustainable. Both Labour and the Tories offered huge incentives for inward investment but then the incentives ran out and most (but by no means all) of the companies fled.
In the 1990s, the carrots were low taxation and “a flexible workforce” – ie you could get rid of them more easily than in other EU countries. When I went off on trips to Japan, Taiwan and other sources of investment in our fair land, I was acutely aware that the factors which had brought them here were not exactly what the new government stood for. We must live with such contradictions but nobody should pretend that having the highest taxes in the UK is going to bring job-creators flocking.
It is difficult to discern what the current big idea is, apart from trumpet-blowing. For any serious student of how Scotland is run, the most relevant announcement I would have pointed to this week is not contained in the Programme for Government or the accompanying flurry of activity. The one that really tells us something was in a press release dated 8 September… 2016.
On that day, Sturgeon announced a “£500 million growth scheme” for Scottish businesses. It was to run for three years and was essential to meet “an exceptional economic challenge” in the face of Brexit. According to Sturgeon, this “brand new fund” was “a half billion pound vote of confidence in Scottish business, Scottish workers and the Scottish economy”.
Well hallelujah. The only problem is that nothing has happened. The Fund does not exist. Not a penny has been paid out. If you follow the Scottish Government website link, it comes up as “The page you requested could not be found”. Yet if you look back, the coverage obtained at the time was the dream of every spin doctor. A triumph – then nothing.
Doubtless there is some convoluted explanation of why the fund has been rolled into this, that or the other and should really be considered part of initiative x, y or z. But it no longer washes. Time and again, big announcements are made – and half a billion is pretty huge – only to disappear into obscurity. It’s headlines they care about while accountability is minimal.
That must change. Every Scottish newsdesk needs to apply a golden rule – check what happened to last year’s announcements before giving a shred of credibility to the next lot!
This week saw more of the same. How often can a Scottish Investment Bank be presented as a shiny new idea? The Scottish Government is awash with money and it would be impossible not to put some of it to good use. But can we please be spared the hyperbolic announcements, not to mention complete cons, and see a more humble commitment to working for practical, attainable outcomes.
Earlier this year we had great self-congratulation when a report was cherry-picked to claim Scotland was second to London in attracting Foreign Direct Investment. Actually reading it shows that the average number of jobs per company is 24, giving a grand total of under 3000. Let’s hope half of these survive, which would be pretty good, but also acknowledge the limitations of this triumph. It does not add up to an economic strategy.
Bizarrely, yet another new quango has been created. In spite of resistance which stopped them subsuming half a dozen agencies into a super-quango, ministers have pressed ahead with their “overarching board” – the Scottish Strategic Board for Enterprise and Skills. What’s more, it has a chairwoman, though publicity for her appointment scarcely matched the scale of the supposed task.
Step forward Nora Senior, who has spent her entire professional career in that economic engine of utter uselessness, public relations. You can imagine Nicola and her team sitting around the table and deciding what the Scottish economy really needs is another dose of PR leadership. I’m sure Ms Senior will oblige at the appointed moments while otherwise doing … what, exactly, nobody has a clue.