Market forces in the public realm have made money for the rich, while services have got worse, writes Scottish Labour leader Richard Leonard.
For the last four decades we have been living through an experiment. The sell-off and out-sourcing of our public services, under the guise of so-called modernisation, lower taxation, and the injection of competitive market forces into the public realm, have been accompanied by the tired mantra that “what matters is what works”.
This is odd for two reasons: firstly, the favoured model rarely favours the people who actually use the service and invariably bends towards the profit motive; secondly, that model has been shown to have failed time and again when outcomes rather than inputs are measured.
It is an attempt to neutralise political discussion, to dress up a heist of our national assets as “serious thinking”, and to dismiss as ideology, or dry dogma, our vision of a more democratic way of running the economy and our public services.
I do not think we can be neutral on the question of ownership. It certainly goes to the very heart of the kind of society I want to see and the kind of society Scottish Labour, under my leadership, wants to build. So, of course, it does matter what works, but it also matters whether we use public institutions or private firms.
Labour does not back the public ownership of our public services out of some dry attachment to an old way of doing things. We back it for a purpose.
So that is why in my speech at Scottish Labour’s annual conference at the weekend, I asked people to consider what has happened to Scotland’s bus services. The most recent figures show that, across the country, routes, staff numbers and journeys have all gone down. The only thing that is on the increase is the price we pay to use this worsening service.
Many of our communities, particularly in more rural and remote areas, have been left stranded – abandoned by a failed model that, perversely, will only provide a service if there are enough people using it to make it profitable. But not profitable in order that money can be ploughed back in to improve services for everyone; rather, profitable so that already wealthy individuals – who almost certainly neither need nor use the service – can make money from it. What a system that is. What a racket.
Well Scottish Labour has a solution. Using legislation that will be going through the Scottish Parliament later this year, we will be pressing for our bus services to be put back into public hands, so that we can run them not to line the pockets of a few shareholders, but to provide a public service that we will all benefit from.
Free bus travel for the over-60s has been one of Scottish Labour’s finest achievements in the Scottish Parliament. It has tackled isolation, created opportunities, and given people a better quality of life. That’s why, working closely with pensioners organisations, we have resisted SNP moves to change the rules of eligibility.
Now our next step will be to press for an extension of the free bus pass to all under-25s within the lifetime of this parliament. If the current SNP Government won’t do it, the next Scottish Labour Government will do it on day one.
But more than this. We will build a proper bus network that connects Scotland’s communities, from town to town, village to village. A universal service, free at the point of use. A truly public service, shifting the balance from shareholders and profits to public investment.
Our opponents will say we can’t afford to do it. But we can’t afford not to. For one thing, every £1 spent on concessionary bus travel generates almost £3 in benefits to those bus users and to the wider economy.
So, this is a challenge to our opponents: back our plans or explain to the public why they’re paying more for a worse service, while their taxes are subsidising private companies to make a profit on the back of it.
And here is another challenge: back our plans for an annual wealth tax. We know that Scotland is a rich and prosperous nation, but that wealth and prosperity is held in the hands of a few, while the services used by the rest of us are sold off and run into the ground.
We should not tolerate such gross injustice and inequality. The debate on investment in public services is all too often couched in a ‘robbing Peter to pay Paul’ narrative. Why should our schools be invested in while our libraries close? Or our NHS gain at the expense of growing poverty and inequality? In truth we need to tackle all of these things. Life expectancy in Scotland is going down, NHS waiting times are going up and so is homelessness. Shelter has declared that Scotland has a housing emergency. None of this is accidental, it is structural. So we are demanding not a horizontal redistribution of income and expenditure, but a vertical redistribution, so that the wealthy pay more.
After all, wealth in Scotland has now reached £1 trillion. I have said before that a wealth tax is an idea whose time has come and have previously called for this to be a one-off windfall. But this wealth is accumulating annually, at the same time as people’s incomes are shrinking and our public services are crumbling. We must redress this imbalance. That is why I am now saying that Scotland needs an annual wealth tax.
So Labour has a serious plan for the economy, which goes beyond the market, beyond the failed system that doesn’t work for the people who matter most. We will back our plan with a properly resourced Scottish Investment Bank, worthy of the name, and we will modernise and expand our manufacturing base so that factories once idle will hum with production again. Sustainable industrial development will be good for our prosperity and will help to resource our public services and public infrastructure.
And I want every part of Scotland to identify local need and a plan for local action, including plans for local production to meet local and national need, backed with national resources to bring about transformative change.
The need for change is demonstrated by the very fact of its possibility. The compelling case for it builds day by day.