Ewan Crawford: Real welfare disaster comes if we stay in Union

Picture: TSPL
Picture: TSPL
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WHEN the leading No campaigners against independence met to brainstorm their plan to outline the various catastrophic events that would confront Scotland in the event of a Yes vote, you have to assume some things were rejected as being just too ludicrous.

Who knows, someone may even have suggested running a campaign on the basis that an independent Scotland would plunge nearly 90,000 children into poverty just six years after the vote.

“Look, let’s stick to stories about border posts and losing EastEnders,” may have been the reply. “Fanciful I know, but let’s give it a go.”

Last week, however, a report from the Child Poverty Action Group said the Westminster government’s policies would result in a staggering one million more children being dragged below the poverty line by 2020. On a simple population share basis that means around 85,000 Scottish children are set to be pushed into poverty by a government we didn’t vote for, and which is pursuing policies four-fifths of Scottish MPs rejected.

This fact, based on the coalition’s own information and analysis by the Institute for Fiscal Studies, should put all the scare stories about a Yes vote into perspective. Unless something dramatic changes, this increase in child poverty is going to happen.

It is against this backdrop that a new proposal is going to be unveiled later this week for a transfer of income tax powers by a left-leaning think-tank. The Institute for Public Policy Research says it is important to frame a “greater devolution” option before the referendum in 2014.

Although we will have to wait until Friday for the detail, the authors of the report, writing in The Scotsman’s sister paper, Scotland on Sunday, suggest powers over policy areas such as social security, VAT and corporation taxation, are best left to Westminster.

Their suggestion, they say, is “in contrast to devo-max or “full fiscal autonomy” as “there would continue to be a grant from the UK government to underpin cohesion and fairness across the UK.”

That then will be the cohesion and fairness that has delivered one of the most unequal countries in the developed world and is set to condemn one million more children to poverty.

Despite the limitations of the plan, the contribution of the IPPR is one that I welcome. It is a recognition that the current settlement is failing.

Indeed before the Edinburgh Agreement signed by David Cameron and Alex Salmond, which confirmed the referendum would have just one question, I would have been happy for a devo-max question to be on the ballot paper.

Given that so many people in Scotland seemed to support a system approximating to devo-max it seemed fair to put it to the test.

But let’s be clear, the Westminster government and all the main Westminster parties were totally opposed to this option. The prospect of legal action if the Scottish Government was to insist on a second question was routinely raised.

The fixation with making this a personal battle with the First Minister, meant that in the Westminster terminology there should be “no consolation prize” for Mr Salmond in the event of a No vote to independence.

This was not a decision based on what was best for Scotland, but a tactical judgment based on what they thought was worse for the SNP. I don’t complain about this. Parties are entitled to seek advantage in a competitive parliamentary system but let’s be clear about why this came about.

However, even though a second question would in many ways have been welcome, recent events have highlighted the urgent need for a full transfer of the economic, welfare and tax powers that can only come with independence.

Transferring income tax powers from Westminster to Holyrood would undoubtedly make MSPs more accountable to voters. Giving the Scottish Parliament the power to spend money but not to raise it has always seemed unsustainable.

But although this issue of accountability is important, any limited proposal of this nature would do little to address the major challenges facing Scotland.

Cuts in public sector employment have revealed that the UK economy is hopelessly unbalanced and that Westminster policy-makers see London and the south-east of England as the engine of private sector growth. There is nothing on offer to voters in Scotland short of independence that is going to alter this trend.

What makes all this so galling and unnecessary is that there are few countries in the world entitled to have more confidence in their economic future than Scotland.

It is not just the forty years of oil revenues or the renewable energy potential or the fact that Scotland’s public finances are consistently healthier than the UK’s as a whole.

With the quality of our university sector, an international reputation for producing quality goods, and the strength of key sectors such as food and drink and other attributes we are well-placed.

And yet we are told we cannot be trusted with the powers needed to realise all that potential.

The No campaign’s response even to the unambitious IPPR proposals was revealing. The think-tank’s ideas were described as no more than “interesting”.

It would be healthy and a welcome change if the Tories and Labour did indeed set out their concrete proposals for further devolution so that we can start a serious debate over the merits of each proposal.

In this respect a video was posted on the internet a few days ago setting out why supporters of independence were voting Yes. One person said: “I want to live in a country where we take care of each other.”

Independence offers the opportunity of creating that caring country, of acting, as the First Minister once said as a “progressive beacon” to others. Surely we should grasp it.