Lesley Riddoch: Bold, practical leadership needed

Thomas Johnston served Scotland well as Scottish Secretary in World War II. Picture: Complimentary
Thomas Johnston served Scotland well as Scottish Secretary in World War II. Picture: Complimentary
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Would that we had a man of wartime Scottish Secretary Tom Johnston’s calibre now, writes Lesley Riddoch

Energy is now the most distrusted industry sector in Britain. In a new survey Which? found 59 per cent of respondents consider energy companies untrustworthy, compared with banks (33 per cent), car salesmen (55 per cent) and train companies (27 per cent).

It’s not as if bankers have raised their trust ratings lately. Last week Barclays and RBS suspended traders amid suggestions currency markets have been rigged. Any proof of misconduct could result in fines exceeding the £290 million and £390m imposed on Barclays and RBS after the Libor-fixing scandal. All this while RBS was owned by “us”.

Meanwhile the Independent Parliamentary Standards Authority reports that MPs claimed £200,000 to offset energy bills last year. Tory MP Nadhim Zahawi topped the league with a claim of £5,822.27 – four times the average annual bill – to heat a mansion which sits in a 31-acre country estate. Who’s “all in it together” now?

Estate agents Savills report that Scottish sporting estate sales in 2013 were up 45 per cent on last year. It seems international demand for “trophy” properties has boosted the value of Scotland’s large estates by 40 per cent since 2000. Indeed since Scotland imposes absolutely no restrictions on land sales, we have long been the world’s most popular destination for wealthy foreign visitors.

Energy, money and land. Every week, headlines bear further witness to the continuing failure of politicians to regulate these key markets or for the markets to regulate themselves. Voters shrug and quietly despair. But I suspect Scotland’s finest Scottish Secretary, Tom Johnston, is turning in his grave. If his municipal outlook had become mainstream within the Labour Party last century, Britain might be a different place today.

This weekend, residents of his native Kirkintilloch gathered to celebrate the anniversary of Johnston’s birth in 1881. The turnout on a wet Saturday night was testimony to the man’s enduring local reputation. The Labour MP’s portrait in Bute House – the only painting personally requested by Alex Salmond – is testament to his enduring cross-party political appeal. So why are Johnston’s achievements not being dusted down now that Scotland desperately needs proven schemes which place cooperation and social solidarity above the profit motive?

Johnston is principally remembered as an outstanding Secretary of State for Scotland in the wartime coalition under Churchill. During four short years with “the powers of a benign dictator” – according to historian Tom Devine – – Johnston brought electricity to the Highlands, “encouraging” reluctant landowners to provide land for a network of hydro dams. When the Hydro Board was set up 70 years ago it was a very different beast to SSE, the private member of the “Big Six” which eventually inherited its mantle.

Johnston’s Hydro Board had a social remit, an exclusively Highland focus and a far-reaching impact on Scottish energy policy – the predictable nature of base-load hydro-electricity was to provide an essential complement to newer intermittent resources like wind energy.

During the war Johnston deployed fear of a possible nationalist backlash along with the key role of Scots in the defence of England to negotiate higher than average Scottish public spending. Council house-building, for example, continued during the war years in Scotland but nowhere else in the UK. This presumption of higher Scottish public spending eventually crystallised into the Barnett Formula.

Opposed to the concentration of new industry in the English Midlands, Johnston attracted an estimated 700 businesses and 90,000 new jobs to Scotland through his new Scottish Council of Industry. He regulated rents, set up 32 committees dealing with social and economic problems from juvenile delinquency to sheep farming and set up general hospitals in the expectation of casualties from wartime bombing – a forerunner of the NHS.

Johnston was an arch-persuader and a very practical man. Reluctant to accept Scotland’s top job at the age of 60, he drove a very hard bargain with Churchill and the Scottish establishment. Johnston accepted the post of Scottish Secretary on the proviso that all living former secretaries of state for Scotland advise him in a “council of state”. This minimised the danger of any establishment reaction against his radical market interventions and provided a template for the SNP’s Andrew Wilson, who suggested earlier this year that Scotland should draw on Johnston’s wartime example in the event of a Yes vote in 2014.

But détente with landowning Tories and Liberals damaged the Scottish Secretary’s radical credentials. As a youthful radical and land reformer, he had established a socialist weekly, Forward, in 1906, had written the classic History of the Working Classes in Scotland and the controversial bestselling exposé of Scottish aristocracy Our Scots Noble Families.

According to local historian Don Martin, this saddled Johnston with the undeserved reputation of a “turncoat”. Instead, he believes: “Johnston was a practical man who believed small was beautiful and people working together for practical purposes were creating the very foundations of society.”

Unlike modern Scottish Labour and the SNP, Johnston was a believer in truly local organisation and powerful municipal councils. In 1912 Johnston started a lifetime connection with the Glasgow Friendly Society, providing a “safe and sound means of investment for the working classes”. This inspired the Kirkintilloch Municipal Bank. Johnston persuaded town council members to form a limited liability company offering 3 per cent interest on savings to townspeople (half a per cent better than the usual rate) which was then loaned to the town council for public works (at 3 per cent lower than the prevailing rate).

Everyone but the conventional banks benefited and other burghs followed suit. This could have installed cooperative forms of finance and housing as mainstream and standard in Scotland. But Labour took a different, centralist, paternalist direction and the rest, as they say, is history.

So here we are today. Cosla members are currently arguing over their share of central government cash, not creating municipal banks, credit unions or local energy companies – all policy areas where modern Scotland still founders and our wartime Scottish Secretary was a successful trailblazer.

So happy belated birthday, Tom Johnston. At a time when bold, practical leadership is desperately needed, when will we see your like again?