Comment: Now the tricky bit - realpolitik

IT IS in the SNP’s interest to respect Westminster and use its new MPs in a positive way, which will be a relief to business, says Alastair Ross

Mhairi Black is one of the many new SNP MPs who will have to learn the ropes of Westminster life from experienced fellow SNP MPs. Picture: Getty Images

Voters probably came to terms with the General Election result within hours of David Cameron returning to Downing Street. Businesses, however, are still poring over what the UK’s first Conservative Government in 18 years will do.

In contrast to coalition, we have the clarity of a Conservative manifesto to be implemented in full by 2020. So what should we expect?

The last administration’s economic policy will continue, with the anticipation that economic recovery and growth will maintain recent upward trends, but the Institute of Fiscal Studies’ concerns on Conservative pledges on taxation, borrowing and public spending remain.

We can also expect a change in the UK’s relationship with Europe. If Prime Minister David Cameron succeeds in his renegotiations with the EU, then we will remain a partner in our most valuable export market. If he fails, then we face a referendum and the possibility of a “Brexit” with no clear alternative trade network to fall back on.

Firms which resented the disruption of last year’s independence referendum face another two years of uncertainty surrounding the UK’s membership of the European Union. Most business people were cautious about getting involved in the politics of Scottish independence but there is already much more appetite to make a case for the UK to remain in the EU.

In domestic terms, there will be further devolution for Scotland, including elements of taxation and welfare, with another Scotland Bill anticipated in the Queen’s Speech on Wednesday. What we don’t know is how far this process will go, especially with a record number of SNP MPs in Westminster adding their weight to the Scottish Government’s call to go beyond the draft legislation published in January and the recommendations of last November’s Smith Commission. The overriding question remains: how will the powers devolved from Westminster to Holyrood help to improve Scotland’s economic growth rate and productivity levels?

A second independence referendum did not feature in the SNP manifesto and leader Nicola Sturgeon carefully avoided committing to one during the campaign, not least because her party cannot afford to lose another one. The SNP would prefer to delay another referendum until there are optimal conditions for a Yes vote – a clear majority of public support, sustained economic growth, and a few more years of Conservative rule to rail against – but will the huge surge in MPs and votes create a demand the First Minister cannot ignore?

Nicola Sturgeon said the election result changes nothing but claimed “the tectonic plates in Scottish politics have shifted”. SNP opposition to the Conservatives and Labour’s collapse closes down much of the ‘progressive alliance’ she had hoped to leverage to Scotland’s benefit.

However, there’s an onus on the new UK Government and the Scottish Government to show they can co-operate constructively – as the previous UK Government did on most matters outside the constitution. Westminster and Holyrood are more diametrically opposed than ever, but as many regulatory and policy issues straddle the Border then neither government can afford to be dragged into continual dispute – they need to demonstrate that the UK remains a viable and attractive marketplace for investment regardless of the political result.

The new caucus of 56 SNP MPs contains experienced business people like former Deutsche Bank executive Ian Blackford and Standard Lifer Michelle Thomson, lawyers Joanna Cherry, QC, and Tasmina Ahmed Sheikh, and of course former First Minister Alex Salmond.

I don’t see the SNP group as a destructive force at Westminster – they may not believe in the institution they’ve been elected to, but under Nicola Sturgeon, Stewart Hosie, Angus Robertson and Alex Salmond, they respect Parliament as an institution and will seek to play a positive, constructive part in it, albeit as an opposition party.

SNP MPs will have places on Select Committees including Business and Energy, and may get more representation on the powerful Treasury one to hold the UK government to account. “Team 56” will have the capacity and responsibility to get more involved in policy areas including tax, financial services, international trade, R&D, and energy even more than before. New MPs will need support in mastering those briefs and that’s an opportunity for businesses to tell them what’s required.

In all but three constituencies, your local MP will be an SNP one, but the party’s track record in Holyrood shows it’s keen to work with business in order to build its own economic credentials and so doors should be open both ways – we’ll find out over the coming years how useful these channels will be.

• Alastair Ross is Director of Public Policy at Pinsent Masons. www.pinsentmasons.com