Alex Massie: Money matters in referendum battle

WHILE their views on what’s best for Scots’ personal finances differ wildly, it’s clear both side of the debate agree on the issue’s importance

The welfare debate has been a key issue in the referendum campaign. Picture: TSPL

For a small country, Scotland contains multitudes. It is only a short distance by road from the splendour of Glasgow’s west end or the genteel luxury of its wealthy suburbs to impoverished housing estates still scarred by the consequences of post-industrial decline. The low road and the high road take you to very different Scotlands that are defined as much by their differences as by anything they have in common. Neither Scotland can be ignored in this referendum campaign; neither is large enough on its own to deliver victory to either campaign.

Despite this, it is generally agreed that votes cast in the former industrial heartlands of Glasgow City, Renfrewshire and Lanarkshire will have a disproportionate influence upon the eventual outcome. Labour voters in Castlemilk or Hamilton; Easterhouse or Gourock are considered the most important potential “swing” constituency upon which the result will hinge.

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As a consequence, the campaign experience here is very different to the one found in Morningside or Aberdeen. It is less a struggle about identity or tax than one about social protection and poverty. This is the campaign that seeks to persuade voters who long ago abandoned faith in politics-as-usual to return to the polls and cast their ballots for a different, better, future. A campaign that, as Yes supporters would put it, still believes in a place called Hope.

Jim Sillars, returning to high-profile politics after years in the background, is adamant the referendum will be won – or lost – in housing estates that were once rock-solid Labour voting areas but that now, too often, have become areas detached from political life. Schemes in which grinding poverty produces a kind of despair, apathy and hopelessness that wreaks enormous damage. Unemployment, disability, poor health and low levels of educational attainment have left too many communities behind. A rising tide has not lifted all boats. This, Yes campaigners argue, is a Scotland that literally cannot afford to vote No. What, in any case, do the poorest communities in Scotland have to lose from independence? Where is their so-called “Union dividend”?

Polling evidence suggests that income is the best single predictor of support for the Union. In general, though with exceptions, the wealthiest parts of Scotland are also those most likely to endorse the constitutional status quo. Which explains why the Yes campaign has made inequality a centrepiece of its campaign to persuade Scots a different future, a different kind of society, is not only achievable but fundamentally necessary. Scotland’s wealth means the country can afford to be independent; poverty and inequality mean it must be independent.

So the argument is twin-pronged. As SNP ministers endlessly repeat, as measured by OECD figures, an independent Scotland would be the 14th wealthiest country on earth. In other words, this is a wealthy nation that can afford to do better than it does at present. Alex Salmond, in his first debate with Alistair Darling, reiterated his belief in an entrepreneurial Scotland that was also a “just society”. Supported by campaign groups such as the Common Weal movement and the Radical Independence Campaign, the battle for independence is, in large part and by their own admission, less a matter of national liberation than a fight for “social justice”.

The SNP’s vision for Scotland is, in many respects, a hybrid beast: Anglo-Saxon capitalist vigour coupled with Nordic social democracy and a generous welfare state. It is an ambitious blend, if also one that contains a certain number of contradictions. Can Nordic levels of social protection really be reconciled with or delivered by neoliberal, Anglo-Saxon levels of taxation? Can every circle be squared so Scotland can be a low-tax, high-welfare country?

Nevertheless, a large part of the case for independence has centred on the need to secure current levels of welfare spending so as to protect Scotland from the presumed ravages of UK Government policy. In this, as in other areas of the debate, the Scottish Government assumes the role of a kind of national protector or guardian, defending the status quo from the predations of the coalition Government in London. In this way independence is reimagined as a vote for continuity, not reform.

Nowhere has this been more abundantly obvious than in the argument over the so-called “bedroom tax”. SNP ministers and Yes campaigners have done their best to suggest this unpopular measure should be viewed as a kind of 21st century poll tax foisted upon the Scottish people against their will. The bedroom tax – now mitigated though not reversed by the Scottish Government – demonstrates devolution’s shortcomings. A policy made in London, foisted upon a reluctant, even hostile, Scotland. Perhaps so, though it remains the case that polling suggests 50 per cent of Scots think unemployment benefits too generous and more than 70 per cent express approval, at least in general terms, of welfare reform.

Be that as it may, according to the Yes campaign, as many as 100,000 Scottish children risk being “plunged” into (relative) poverty by the current Westminster Government’s welfare reforms. Meanwhile, the prevalence of food banks – the use of which has increased sharply in recent years – is a mark of shame that disfigures a wealthy country such as this. If this is a mark of the Union’s success, Mr Salmond asks, what horrors would failure reveal?

Scotland, in this dystopian view, will become a less, not more, equal country if the Union is retained. There are moments, in this long campaign, when it is not clear which campaign better deserves the sobriquet “Project Fear”.

Nevertheless, uncertainty about the future provision of matters such as pensions is an unavoidable part of the independence debate. As Better Together insists this, like uncertainty on the issue of an independent Scotland’s currency, is an unnecessary uncertainty and one introduced by the SNP itself. Whatever one might think of the constitutional argument in its abstract or theoretical terms, pensions, like wages and the broader economic outlook, is a question that voters are entitled to consider in highly personal terms.

Which is why the Scottish Government has gone to great lengths to reassure voters that whatever risks independence might entail, the fate of your pension is secure. Doubtless the technical details of establishing a new pensions system would be complex but, rest assured, they would be far from impossible. State pensions would continue to be paid as they are now, insist the nationalists; nor would occupational pensions be threatened by the transition to a new constitutional arrangement, despite an onerous EU requirement that cross-border pension funds need to be fully funded. The state pension, moreover, would be “guaranteed” by a “triple lock” rising by a minimum of 2.5 per cent a year or in line with inflation or wages.

Here again, the dominant motif expressed by the Yes campaign is that Scots have little to fear save fear itself. A different Scotland is not simply something to be imagined, it lies just around the corner. That, at any rate, is the promise in which Mr Salmond wishes you to believe.