Brian Monteith: Mad not to use existing powers

MSPs are gravely concerned about the crisis-hit housing association. Picture: Kenny Smith

Arthur Conan Doyle famously wrote a Sherlock Holmes story that included the curious incident of the dog in the night-time, more commonly known as the case of the dog that did not bark. Like that tale, we are, in these pre-referendum times, in a curious situation where politicians who are expected to use all the powers at their disposal have refused to do so, they have failed to bark, and yet they ask for more powers. Why is this?

The Scottish Parliament has always had more powers to act than its politicians have been willing to employ. In the early period of devolution, the power to vary income tax existed – but it was never used. Eventually Jack McConnell set in train the process that effectively removed that power by ending the funding of the cost of maintaining the administrative set-up – a decision that curiously John Swinney endorsed when he became finance secretary. Despite Swinney wanting greater powers, it suited him that he did not have the ability to raise or cut income tax but could instead condemn British economic policy.

While there has been a great deal of huffing and puffing about the cruelty of Westminster and its current austerity plans (although we should remember the SNP’s claims of victimhood because Westminster was not spending enough on Scotland before the crash of 2008) the SNP has never sought to vary other taxes or reform them when it has had the powers available. To do so would conflict with its narrative that a Scottish Government needs greater authority that can only come from sovereign independence. More problematically, using powers even for reforms or tax cuts invariably risks unpopularity or leaves opportunities for opponents to demonise the politicians brave enough to take a decision – and the tougher that decision the less likely it must be that action will happen.

And although tough decisions can be the right ones, the public perception of them being wrong can become the received wisdom, and cast public figures as infamous for the rest of time. We just need to look at the case of stemming the losses of Britain’s rail network to see how such mythology can deter politicians nowadays from taking tough decisions.

Some 50 years ago last week, Dr Beeching published his report, “The reshaping of Britain’s railways”, which was then applied by the Conservative and subsequent Labour transport ministers. It is now commonly believed that Beeching’s proposals for axing thousands of miles of branch lines and the closure of many stations was economically calamitous, if not socially criminal, and yet Beeching was faced with a network where 30 per cent of British Rail’s lines carried only 1 per cent of passenger traffic.

While it is arguable that some lines and stations closed that could later show a stout case for remaining open, the general thrust of pruning the rail network was the right one, for it allowed the subsequent investment to introduce faster trains that could make British Rail compete more effectively against the growing use of the motor car. Beeching’s philosophy of moving “bulk at speed” with 70 per cent of trains travelling at over 50mph and expresses at over 70mph is now the accepted norm. Without Beeching, high-speed rail travel would not have become possible.

Today’s politicians do not wish to become latter-day Beechings, nor do they wish to see their greater goals – such as independence – being put at risk by introducing reforms that, in the run-up to a referendum or election, will risk the outcome.

The current changes to Incapacity Benefit are another example of how a much-needed welfare reform has had a bad press, despite producing beneficial outcomes for the public finances and the British taxpayer.

Following a medical review of those receiving the benefit, 837,000 were judged fit to work immediately; 367,300 were considered able to do some level of work and only 232,000 were too ill to work (only one in eight of those tested). Staggeringly, another 878,000 elected to withdraw their claim without submitting to a medical examination at all. And yet which politician would wish to be in Iain Duncan Smith’s shoes?

Hands up those SNP ministers who would attempt any welfare reform in Scotland if it had more powers or became independent. Are we honestly to believe that every institution inherited from the UK is beyond reform if it means reducing spending or restricting benefits? By playing the negative card by exhuming the ghosts of Tory governments past and present, does Nicola Sturgeon seriously expect us to return to some sort of social democrat nirvana of the pre-Thatcher 1970s?

There are economic powers available to the current Scottish Government. There is also some real hardship, there are injustices and there are opportunities – all of which could be addressed to some extent by using the existing powers at the government’s disposal.

If the SNP has abandoned all hope of introducing a local income tax, then it should press ahead with the reform of council tax now rather than wait until independence. If the SNP accepts the recommendation of its economic adviser Sir James Mirrlees that property valuations should be updated to be contemporary rather than set in the aspic of 1991, then why wait until independence? Further reform might include the introduction of additional bands or moving where the various bands apply. All these aspects could be explored, debated and introduced. The laws to do so exist.

Likewise, while powers to reduce corporation tax do not exist under devolution, and may never do so, there is much that can be done to make Scotland an attractive economy for business rather than wait for the power to set a tax rate similar to the Irish level of 12.5 per cent. Thus John Swinney could draw up plans now to cut year-on-year the poundage for Scotland’s business rates so that a genuine competitive advantage is created over England.

Then there are the additional powers that will become available through the new Scotland Act – and only Tory leader Ruth Davidson has said she would use the powers to cut income tax by at least 1p. If she can say it, why not John Swinney? Is the SNP that breed of dog that never barks – or is it just feart?