Welcome to my Blog

It mostly covers my work as UNISON Scotland's Head of Policy and Public Affairs although views are my own. For full coverage of UNISON Scotland's policy and campaigns please visit our web site. You can also follow me on Twitter. I hope you find this blog interesting and I would welcome your comments.

Wednesday, 27 May 2015

A Queen's speech that divides the nation

Today's Queen's speech is motley collection of proposed bills that fails to address the big issues facing the UK. Far from being a plan for 'working people', it further concentrates power in the hands of the rich and powerful.

As usual many of the Bills have limited relevance to Scotland because of devolution and for that we should be grateful! Those that do can still do plenty of damage. Here is my summary of those that do impact on Scotland.

European Union Referendum Bill. This will pave the way for an in/out referendum on Britain’s EU membership that will have to be held by the end of 2017. The franchise will broadly be the same as for the general election.

 

Investigatory Powers Bill. This brings back the ‘snooper’s charter’ legislation on tracking individual web and social media use, plus the security services’ powers of bulk interception of the content of communications.

 

Extremism Bill. Designed to "stop extremists promoting views and behaviour that undermine British values". It will cover communications, bans on extremist speakers on university campuses and employment checks. There are some devolved issues here that will require the support of the Scottish Parliament.

 

Immigration Bill. Creates a new enforcement agency to tackle the worst cases of exploitation as well as creating an offence of illegal working and enabling wages to be seized as the proceeds of crime.

 

Proposal for a bill of rights. This highly controversial manifesto pledge is kicked into longer grass with a consultation promised. A complex interaction with the Scotland Act is just one of many hurdles.

 

Full Employment and Welfare Benefits Bill. Despite the title this is mainly aimed at cutting the value of benefits including reducing the household benefit cap from £26,000 to £23,000 and a two-year freeze on the majority of working age benefits. This wont deliver the promised £12bn welfare cuts that are likely to fall on benefits for those in work, including many low paid UNISON members.

 

Trade Unions Bill. Aims to make strikes, particularly the public sector, difficult to call. First, more than 50% of a union’s members must vote in order for the ballot to be valid, and second, at least 40% of those entitled to vote must be in favour of the strike. There is also to be a new time limit on the ballot for industrial action. The bill would also force trade union members to opt in if they want to pay a political levy.

Here are a few Tory cabinet ministers who wouldn't even be in parliament if the same thresholds applied to being an MP.

Scotland Bill. Implements the Smith Commission agreement, or arguably somewhat short of that. There will be attempts to extend these provisions, some of which UNISON will support in line with our submission to the Smith Commission. The promise of English votes for English laws (known as EVEL) will be implemented through changes to the standing orders of the House of Commons rather than a new bill. There will also be a revised Memorandum of Understanding between the UK and devolved governments.

 

Enterprise Bill. Reducing regulation on small businesses although could be used to damage employment rights even further. This bill will also cap redundancy pay to higher paid public sector workers. Some of the provisions are devolved so wont apply to Scotland.

 

National insurance contributions bill/finance Bill. Prevents the UK government increasing income tax rates, VAT or national insurance for five years. This limits the scope to address the deficit and is likely to mean even greater spending cuts in the planned summer budget.

 

Personal tax allowance. Designed to "ensure that future increases to the income tax personal allowance reflect changes to the national minimum wage".

 

Energy Bill. The veto on new onshore windfarms won’t apply to Scotland, but changing the way the North Sea is regulated will.

 

STUC General Secretary Grahame Smith summed up the Queen's speech well: "Despite the ‘one nation’ rhetoric, this is clearly a programme for government which would further divide the UK on the basis of class and nation. This is anything but a ‘Queen’s Speech for working people’, it fails to offer real protection from zero-hours and low pay whilst attacking their democratic rights."

 

 

Tuesday, 26 May 2015

Pre-payment meters masking fuel poverty

Pre-payment energy meters are being used to mask the real levels of fuel poverty in the UK.

An investigation by BBC 5 Live has highlighted that more than half a million pre-payment energy meters have been forcibly installed in people's homes over the last six years. Energy suppliers can gain a court order to install a pre-pay meter when customers run up debt.

Citizens Advice said pre-pay customers got a "raw deal", paying £80 a year more on average than direct debit customers. Audrey Gallacher of Citizens Advice, described the figures as "concerning", but "not a big surprise", and said that an increasing number of people had contacted the organisation complaining of problems with the devices. "Pre-payment meter customers can't take advantage of the competitive energy market," she added. "Many people become trapped on them and can't get a better deal."

Energy watchdog Ofgem said it would be "looking into reasons behind the increase in the number of PPMs installed for non-payment of debt on a warrant visit. Suppliers can only install a pre-payment meter where it is safe and reasonably practical for the consumer to use". However, we won't be holding our breath on this. Ofgem investigations often last for years and rarely deliver a significant outcome.

This evidence adds to recent research by the Debt Advisory Centre, that found 4.7 million people are regularly cut-off from pre-paid electricity, and one in 10 have arrears on their water, gas or electricity accounts. A quarter of British people say they rely on expensive pre-pay meters, due to previous struggles with bills, or because they need help to manage their energy spend.

More than four million people in the UK say that they often cannot afford to top up their gas meters. Of these, 18% say they are cut-off from their gas meter every few months, while as many as 7% lose their gas supply at least once a week because they can’t afford to top-up the energy key.

Earlier this year an analysis from the House of Commons library showed that the average household’s annual energy bill is now £260 more than it was in 2010. Electricity and gas bills for the poorest households rose by 40 per cent and 53 per cent in cash terms between 2010 and 2013.

Sadly, action on fuel poverty is unlikely to feature in tomorrow's Queen's speech. A manifesto survey by Energy Action Scotland, supported by UNISON Scotland, showed a limited range of actions being proposed by the political parties. Considerably short of the radical steps required to eradicate fuel poverty. The Housing (Scotland) Act 2001 created a statutory duty to ensure, so far as is reasonably practicable, that people are not living in fuel poverty in Scotland by November 2016.

One of the reasons fuel poverty is a low priority is because cold houses are being masked by expensive pre-payment meters. At the very least pre-payment should be the lowest, not the highest tariff.

 

 

Tuesday, 19 May 2015

How responsible is responsible investment?

Responsible investment is a nice title and a growing industry, but how much difference does it really make to the way our pension funds are invested?

Courtesy of the excellent Nordic Horizons programme I was in Edinburgh City Chambers last night to listen to Zaiga Strautmane who heads up responsible investment for the Danish pension fund Unipension. They joined three corporate pension funds together covering a range of professions to create a stronger fund with 100k members an assets of £10.5bn.

It is important to emphasise that 'responsible investment' is not the same as 'ethical investment'.

After a particular investment row they developed a responsible investment code. There are no statutes in Denmark on this issue other than a requirement on large firms to produce social responsibility reports and some guidelines on responsible investments, which usually followed.

They started with a member survey, repeated every three years. Interestingly, the first question was 'How much money are you prepared to give up?'. The answer was £50 to £100 per month. I would be sceptical about the premise of the question, but the commitment of these Danish workers is impressive.

After identifying the views of members they scanned the sort of world issues that concerned them e.g. Bangladesh clothing factories, child labour, corruption etc. They also looked at good socially responsible companies in Denmark as a benchmark, but discovered not all were as good as they thought.

They started with the UN Principles for Responsible Investment (PRI). Then developed an active owner, vote and engage strategy. They cooperate with other investors to give scale and clout and are transparent about their approach with regular reports on their web site.

Their list of issues comes from the UN Global Compact including human rights, labour rights, environment and anti corruption. Then they added controversial weapons, sanctions, and good company governance. They have a legalistic, not political approach, following international conventions on these issues. For example, they have not excluded firms involved in Israeli settlements because they regard UN resolutions declaring them illegal, political not legal decisions.

The plan covers all asset classes - equities, properties and bonds. They focus on engagement before exclusion, although some 30 companies have been excluded. This doesn't include fossil fuel divestment despite members wanting them to exclude. She argued that there are no financial reasons to exclude and even if they did, other shareholders would take up the slack. They don't have to follow AGM decisions and have a similar concept to our fiduciary duty.

To give a Scottish contrast, Marianne Harper Gow from Baillie Gifford set out their approach to responsible investment. They focus on company culture and governance. She illustrated this by describing the BP Gulf of Mexico oil spill as an environmental disaster, but the cause was governance failure. Pension funds are long term investors and BP's cost cutting and outsourcing should have been a warning sign.

They do responsible investment through research, proxy voting, engagement and reporting. Building long term relationships with companies rather than exclusion.

I am usually inspired by the different approaches taken by the speakers in the Nordic Horizons programme. Sadly, not this time. The Danish approach taken by this pension fund does have some improvements over practice in Scotland. A long term investment approach, greater transparency and in practice they appear to have carried out responsible investment, including avoiding hedge funds.

The Baillie Gifford approach was even less impressive. On their long term (10 yrs) list of companies was Amazon. That company's aggressive tax avoidance and poor employment standards, clearly passed them by!

My concern is that change is at best incremental in this approach. They don't appear to be listening to members and hide behind legal and political classifications. it seems largely cosmetic. Phrases like it will 'stay on the agenda', doesn't inspire confidence that action is on the cards. The track record isn't very good either. For example, for all the engagement over board remuneration, pay ratios continue to rise.

I'm afraid I was left with the impression that responsible investment approaches both here and in Denmark leave much to be desired. It will need pension fund members and civil society to take a more aggressive stance on this issue. We certainly can't rely on the fund managers.

Friday, 15 May 2015

What's coming our way with a new Tory government

As the Tories form a government at Westminster what are the issues likely to face Scotland and trade unions in particular? There are many, but the key issues are likely to be public spending, welfare, employment rights and the constitution

The key issue for any devolved administration is funding. We know from the budget that the Chancellor’s plans involve slashing £30bn from UK public spending with the deepest cuts in 2016/17 and 2017/18, as this chart shows.

What does this mean for spending in Scotland? As always it's difficult to be precise because we don't know exactly where the cuts will be made in England and therefore the Barnett consequentials. The Budget stated that £13bn will come from departmental budgets, £12bn from welfare cuts and the £5bn balance from tax avoidance savings.

It's the department budgets that have the direct Barnett consequentials and that might be mitigated a bit if they deliver on the promised cash input into the English NHS. We still don't know where the welfare cuts are coming from and I suspect the tax avoidance savings are very unlikely to be delivered. Particularly as they are cutting HMRC staff! There is therefore a real risk that departmental budgets will have to take a greater share of the cuts with negative Barnett consequentials.

Cuts at this level will require more than the salami slicing approach of recent years. Will the Scottish Government continue to dump most of austerity on local government and if so where does that leave policies like the Council Tax freeze. While I have no doubt the Scottish Government will do what it can to mitigate, we all need to start thinking outside the box for some creative solutions. The Smith Commission borrowing powers, while not all we would want, may be one opportunity to look at issues like refinancing expensive debt and PPP schemes.

Closely linked to spending is pay policy. Pay restraint is likely to continue and next April there will be National Insurance contribution increases that will take a further 1.4% out of the pay packets of workers in contracted out pension schemes. That's most of the public sector. It will also hit public sector budgets as employer contributions will rise by a massive 3.4%. None of this will do much for spending power in the economy - continuing the low wage, low productivity problem that underpins much of our economic woes.

While the Tories refused to spell out where they would cut benefits to achieve their spending cuts, it is clear that they will largely come from the working poor. This will be a further attack on incomes, particularly for low paid workers with families. Some 250,000 in-work families who currently receive Child Tax Credits (CTC) and Working Tax Credits (WTC) face a potential threat of £40 per week on average being cut from their weekly incomes.

There will be a further attack on employment rights that are already some of the weakest in Europe. Industrial action thresholds are designed to undermine the right to strike and employers will be allowed to bring agency staff to scab. I fear there will unforeseen consequences of this with many more small scale disputes where the threshold is usually met, coupled with new forms of unregulated protest. Talk of deregulation from the new Business Secretary is code for further attacks on workers rights and undermining basic protections such as health and safety. On a more positive note there will be an opportunity to address the pernicious impact of Employment Tribunal fees when this is devolved under the Smith Commission proposals.

This is another reason why the Human Rights Act is under attack. The Tories don't want their legislation to be challenged. There is an interesting and developing debate on how this sits with the Scotland Act requirements and what we might be able to do to resist this. It's complex and probably the subject of a separate post, but that Tory champion of human rights, Winston Churchill, will be turning in his grave.

While there is a commitment to implement the Smith Commission proposals, that won't be the end of the constitutional story. As a Scottish Parliament committee highlighted this week, the legislative proposals fall somewhat short of the recommendations and others need more clarity. There will be additional pressure to improve on Smith as reflected in the STUC Memorandum of Understanding with the Scottish Government this week.

There will be a temptation for the UK government to call the Scottish Government's bluff on Full Fiscal Responsibility, although I suspect Treasury orthodoxy will triumph over political opportunity. We must hope so, not just because of the negative public spending consequences, but because creating a UK version of the Eurozone's fiscal and monetary policy mismatch won't help the economy.

The above demonstrates that the next few years will be pretty grim for everyone in Scotland and the rest of the UK, with the obvious exception of the rich, who will be pampered as usual. Devolution brings some opportunities to mitigate the damage in Scotland and so we all need to work together constructively to exploit that potential.

 

 

Sunday, 10 May 2015

Some post-election thoughts

Well, that wasn’t pretty. As someone who has participated in elections since the age of 12, that one rates alongside 1979 and 1992 in terms of outcome, and possibly worse in terms of the campaign itself.

It was very tempting to jump to instant analysis and solutions, but I have resisted the temptation. I think some analysis is justified, but I believe some careful consideration is needed on solutions, both for Labour and the other political parties as well as those outside the party structures who have to deal with the consequences.

So where are we? Will Hutton, in today’s Observer, summed up in a paragraph the likely failure of a Tory win to address the UK’s major problems; "David Cameron’s Tory party will not reform the structures that make business building so hard. The productivity crisis will continue. R&D will stagnate. The trade deficit will widen. Inequality will grow. Low wages and insecure jobs will proliferate. The housing crisis will deepen. Public services will become more threadbare. Foreign companies will plunder our national jewels. Public service broadcasting will shrink. Human rights and civil liberties will be weakened. Britain will continue to become more marginal in the world."

The impact on Scotland could be just as serious. Austerity continues with two years of major cuts that the salami slicing of recent years will be unable to paper over. Relationships between Holyrood and Westminster are likely to be a combination of austerity max and grievance max, which again will distract from the need to take long-term decisions. While most nationalists I know would prioritise ending austerity over independence, a right-wing Tory government has long-term benefits for the fundamentalists.

The added factor in this election was the ugly short-termism of the Tories in playing an overtly English nationalist card. The polls in the marginal seats and my discussions with colleagues running campaigns in areas like the Midland’s, makes it clear that the Tories didn’t waste the millions they invested in this aspect of the campaign. As a consequence we have a further batch of Tory MPs who are not unionists at all. They can see that forty fewer Labour MPs and the damage it did to the Labour vote in England was a good thing for their short-term political prospects. This is likely to add fuel to the flames in the coming years

So what about Labour?

At a UK level there is the predictable Blairite call for a return to the ‘centre ground’, whatever that is. They have spent years undermining Ed Miliband and now they can go public. Retro style may be fashionable, but back to the 90’s isn’t a coherent political strategy for any political party. The UK Labour strategy in this election did offer differentiation, but always fell short of convincing many of those who should have voted for Labour. For example, the employment rights offer was broadly positive, but an ‘inquiry into blacklisting’ was hardly likely to get those who care about fairness in the workplace, queuing up to vote.

Scottish Labour's problems didn't start with Jim Murphy's leadership or the fall out from the referendum. It goes back to the Blair years when even the positives were played down because they didn't match the New Labour narrative. This played out in Scotland with Labour led administrations that got no credit for taking radically different approaches. For example, it was Labour that abolished the market in NHS Scotland, but was asked to keep it quiet and as a result the SNP now claims to be the party that 'reversed privatisation'.

The same problem played out after 2010. The narrative that Labour's overspending had caused the crash was allowed to gain credence, because ‘fiscal prudence’ was the narrative that Ed Balls championed.

Then there is the Westminster problem. Too many Scottish Labour MPs gave the impression that they were semi-detached from Scotland. Hostility to the Scottish Parliament and media briefings reinforced that view. The anti-politics driven by the expenses scandal had a more credible outlet in Scotland. Organisation on the ground was weak in seats that have never really been challenged, although in fairness, the same can be said of all parties in 'safe' seats. As Rob John's analysis rightly identified back in February, "The shift to the SNP is the expression not of a mass post-referendum conversion to independence, but of longstanding preferences for self-government within the union". Most Scottish Labour MPs have been on the wrong side of this trend for years and some even oblivious to it – not helped by an MP becoming a career choice. Student politics then parliamentary researcher may equip you for the Westminster bubble, but not for the real world back in the constituency. Labour simply hasn’t been selecting enough authentic voices with the skills and life stories to be credible. The tragedy of this election is that the good MPs are swept up with the bad

Aspects of the U.K. campaign didn't help. Rachael Reeves "we're not, the party to represent those who are out of work", was to put it mildly badly thought through. Ed Ball's reluctance to trumpet the difference in spending plans negated, from a trade union perspective, the best pro-Labour line. This allowed the SNP to claim to be the party to end austerity, even when their numbers didn’t add up. Even when Jim Murphy rightly recognised the importance of a different narrative in Scotland on this, Chuka Umunna went out of his way to undermine the narrative in a shocking campaign interview.

Ed Miliband may never have won over most Scots, but he had a good campaign that went a long way to improve his standing in Scotland. All to often, particularly during the referendum, he came to Scotland badly briefed and it showed. Sadly, that isn’t just down to his poor advisors, certain MPs also gave him poor advice. Whatever my political differences with Tony Blair, his private office would always check the ground out before a visit to Scotland. The only really bright moment was Ed’s speech to this year’s STUC. The failed auto cue seemed to liberate him and we got a speech of passion and content that we needed much, much earlier.

On the short campaign, we should firstly give Jim Murphy some credit. Scottish Labour's campaign needed an injection of energy and he provided it. The problem was it lacked focus. If you are going to use the New Labour textbook, follow it through. If there was a big idea, a narrative in the jargon, it was lost on me. This is well illustrated by the alcohol at football matches issue. A focus group identified this as an issue for the very 'Glasgow Man' that apparently needed to be won over. The problem was that it was never that high in 'Glasgow Man's' agenda and it turned off lots of other groups, particularly women, who were Labour's strongest demographic. The Democrat’s in the USA learned long ago that collecting issues rarely adds up to a majority.

At the special conference in Edinburgh we were shown a frenetic video that jumped all over the place, but had no focus. It was a metaphor for the campaign. As one activist described it, "The problem is Jim is all over the place. He's gone from putting a kilt on everything to now talking about socialism. It lacks credibility". STV Stephen Daisley's tongue in cheek piece on the manifesto launch caught the mood when he thought it was Neil Findlay not Jim Murphy launching the manifesto.

Iain Macwhirter summed up what a lot of Labour activists were saying privately in his Herald column during the campaign; "But the good that Mr Murphy is doing for Labour is being undermined by the air of contrived frenzy and by an unavoidable scepticism about his sincerity. Maybe Labour is now - as the party claims - more left wing and socialist than the SNP, willing to contemplate renationalisation of rail. But it is hard to see Mr Murphy as Scotland's answer to Alexis Tsipras - it just doesn't add up."

I did a number of meetings and focus groups during the campaign. The participants didn't have a problem with the kilt or socialism. They just didn't trust the messenger. Those with some political knowledge referred to his political baggage and questioned the sudden conversion - the others just didn't trust him. They didn't like his presentational affectations (he did eventually drop the patronising whisper) and openly said he didn't sound sincere. Actually many were less polite, but you get the drift.

When you have as much political baggage as Jim Murphy, it is difficult to persuade people of a Damascene conversion. The Iraq War, Trident, tuition fees, Henry Jackson Society etc were all trooped out. Hiring John McTernan was a further gift. His 'Thatcher's economic reforms were a good thing' and similar was a gift to the SNP - even if Alex Salmond once said something very similar.

So what about some solutions. It isn't easy because the beauty of nationalism is that there is always someone else to blame for your own shortcomings. Labour also needs to have a calm rethink and I don’t claim to have the answers, but here are a few discussion points.

Party structure. Some activists have argued for an independent Scottish Labour Party. I remain unconvinced that this would be viewed as anything other than a rebranding exercise and doesn't have enough support amongst activists, who value being party of a UK party. However, a more federal structure is possible enabling Scottish Labour to take control of its own organisation and take different policy positions, not just on devolved issues. This will be all the more important if Labour in England wrongly believes it has to tack to the right.

 

Constitution. Neutrality or support for independence won't work because most centre-left, pro-independence voters already think there is a party for them. However, Labour should still offer a home for those who support independence, but recognise that the SNP isn’t a socialist party and accept that the constitution wont always be the first priority. Labour managed these apparent contradictions in the past over issues like Europe and could do so again. Scottish Labour should also emphasise that it has consistently delivered on devolution and will be more radical, which after all is the majority position in Scotland.

 

Values and policy. Trident replacement is a big millstone around Scottish Labour. Why would you join a party and try to defend the indefensible cost of a useless weapons system. It may not be Scottish voters biggest issue but looks like one policy where changing it could win a lot of people over.

Even more important is values – the ‘what is Scottish Labour for’ question? Lord Ashcroft asked different voters what the main motivation behind their choice was, with 75% of voters saying that trust in the motives and values of their chosen party drove their decision. In the case of the SNP, the number rises to 91%. Among Labour voters, trust in the party’s motives and values drove 75% of their voters, while among Tories it was lower, at 71%. If Labour becomes the ‘whatever works’ party – it’s doomed electorally and why would you want to join it?

 

Election strategy for 2016 and 17. It was noticeable in the leaders debates that Nicola Sturgeon was much less comfortable defending her own government's record. It's easy to say what you would do when you don't have to deliver in a UK election. In 2016 the SNP will have to defend its record in government over two terms. Labour may benefit both from being the challenger, but it will have to be more radical and have some clear red water on key issues.

Scottish Labour has already started chipping away at the SNP claim to be Scotland’s progressive party. The SNP are very good at rhetoric and process, they are less good at delivery. Issues like fracking, colleges, police, transport and housing, particularly in the private rented sector are all issues on which the broad ideological SNP coalition can be stretched.

These issues also point to a different approach for Scottish Labour. The SNP, both as a party and as a government are instinctive centralists. Differentiation for Labour could be based on greater localism. Not the Tory ‘choice’ localism, but one rooted in new approaches to local democracy. However, this also requires all Labour councillors to recognise that they are part of a political party, not semi-detached local administrators.

 

Tribalism. I have an instinctive dislike of tribal politics. I can disagree with the SNP on policy issues, particularly their grasp of economics, while acknowledging common ground. I can do the same with the LibDem’s, even occasionally with the Scottish Conservatives, if not their UK counterparts. Labour politicians can be quick to condemn tribal nationalism, but allow their own, sometimes virulent, dislike of the SNP to influence better judgement. It becomes almost a Pavlovian reaction, rather than an objective response based on Labour values.

 

Leadership. While I didn’t vote for Jim Murphy, I at least understood the views of those who believed he would deliver a sharper campaign. Sadly, it reflected a view of politics that all you need is a sharp marketing strategy, rather than addressing the basics. As it turned out, for the reasons I set out above, the campaign didn’t even have that. A marketing friend of mine, experienced in testing celebrity endorsements, said to me after a focus group session - if this is Labour’s message, then I’m afraid Jim Murphy isn’t the right messenger. Jim was always going to be associated with campaigning alongside the Tories for the No vote - to deliver the new narrative of Scotland’s champion. As for socialism, well his political baggage makes that a very difficult sell.

The question now is arguably less what happened in the campaign, but what is the strategy going forward. Once you have a clearer view of that, you then ask the question – what leader can take that strategy forward? Some members and affiliates have already answered the leadership question; others will have to if Jim Murphy becomes possibly the first leader not to take responsibility for his own campaign.

 

While long-term trends for Labour are not positive, don’t forget that events outwith your control can also be damaging for any political party. For the Tories, Europe will be a huge challenge, but also an opportunity for distraction from the economy. For the SNP, I wouldn’t rule out the chances of the new Tory English nationalists saying, if Scotland voted for Full Fiscal Responsibility, let them have it – as Boris Johnson is already doing. That really would be Armageddon for public services and must be resisted, but it would highlight to voters how the SNP plays fast and loose with economics. Chinese levels of economic growth wont save the day. However, I suspect Treasury orthodoxy will win through, and for once we should be grateful for that.

For trade unions and more importantly their members, patience with Scottish Labour is running very thin. On the few occasions when advice is asked for, it is often ignored. Unions warned about the second referendum question and Better Together, not to mention many policy issues. Trade unions don’t always get it right, but they are far more rooted in the workplace than anyone in the political bubble. The real risk for Scottish Labour is not just institutional separation, but something far worse - indifference.

 

Wednesday, 6 May 2015

Why I am voting Scottish Labour

Of all the elections I have been involved with this has to be one of the worst. The big issues that should have been debated have been swamped by the process of coalitions, deals and the banality of shoes, kitchens and bacon sandwiches. Dumbing down doesn't even begin to describe the coverage of this election.

But if you can ignore the drivel for a few minutes, let me explain why I am voting Scottish Labour.

Let me start with what I accept is an emotional reaction that I have heard many times - Labour has lost its way, the SNP now represents the traditional values that Labour used to stand for.

Now if you glance back in this blog and elsewhere you will see that I can be highly critical of Labour on many issues. I do recognise that there are good reasons for people to be angry with Labour because, on occasion, I have shared that despair. I am also not a tribal politico and I concede that there is plenty in the SNP programme that I agree with - not just the bits they cut and pasted from the Labour manifesto.

However, traditional Labour values are in short supply in their manifesto. The acid test of a socialist is a recognition that redistribution of wealth is required to tackle inequality. When Nicola Sturgeon was asked at her manifesto launch to name a redistributive policy enacted by the SNP in Holyrood, she was unable to cite a single example. We have had plenty of middle class welfarism, but relatively few effective measures to reduce inequality or poverty. We are told that Scandinavian levels of public services are possible without any increase in taxation and that simply isn't true.

The Blair and Brown government's did some great things. Devolution, minimum wage, cutting child poverty, tax credits, rebuilding our public services to name but a few. But it was often done by stealth because these good things didn't fit the New Labour narrative, and yes, they made some mistakes as well. The irony of this election is that we have a Tory leader lurching to the right and a Labour leader in Ed Miliband who is articulating genuine radical policies. They are not 'all the same' in this election by a long way.

For devolved Scotland there really is only one issue that matters in this election. Who will end Tory austerity and save our public services. The return of the Tories will result in at least another £2bn slashed from Scotland's budget and that's a further 30,000 public sector job cuts. Followed by employment law changes aimed at undermining workplace resistance to the cuts.

Labour's plan is not all I would want it to be and the new narrative of fiscal prudence risks precisely the same confused message as in the Blair years. But the numbers, as this chart shows, demonstrate Labour will deliver the best spending outcome and improve employment rights.

My biggest problem with the SNP programme is the economic illiteracy. I don't doubt that they also want to end Tory austerity, but their policies will have the opposite effect. Full Fiscal Autonomy will slash £7.6bn from the Scottish budget, rising to £9.7bn by the end of the decade and that's more than 140,000 Scottish jobs. And I'm sorry, but the idea that this can be wished away through eye watering levels of growth is frankly absurd.

Slogans like 'Stronger for Scotland' do have an emotional appeal and I appreciate that they can trump complex economics. But as my old Gran used to say 'they butter no parsnips". Only a Labour government can end Tory austerity, you can't vote for deals or coalitions, they aren't on the ballot paper. And this will be a Labour government that has real dividing lines with the Tories, who are now simply the party of the rich, for the rich.

This election matters in Scotland primarily for the impact on public services and those who deliver them. I am voting Scottish Labour because I am not prepared to gamble those services and jobs away for a slogan.

 

 

Monday, 4 May 2015

Why this election matters - energy policy

 

One issue that has received very little attention in this election is energy policy. While there are some devolved aspects, the generation, transmission, distribution and supply of electricity and gas is reserved along with nuclear and coal policy.

Energy matters to consumers. The average household spends 6% of household income on energy. That’s £1657 per household, from an average wage of £26,500.

At least 40% of Scottish households are living in fuel poverty. The latest figures show that in 2013 in Scotland there were 940,000 households in fuel poverty, compared with 647,000 households in 2012. Given that energy prices have largely gone up since then, and household incomes have stagnated, then it is likely that over a million Scottish households are in fuel poverty, with more at risk.

Millions of people have been ripped off by the big energy firms who never seem to pass on savings to customers. In the last year, wholesale energy costs have fallen by between 9% and 20%, but only now are suppliers reducing the price of their standard tariff.

The Carbon Brief’s election tracker provides an ‘at a glance’ look at the main party manifesto pledges.

So what are the dividing lines? All the main parties have given a strong commitment to continued emissions reductions, even if they are sometimes less than clear on specifics. Cameron’s green credentials have looked less credible as this government has gone along. If the Conservatives win, they are likely to place less priority on funding for some low carbon technologies. If Labour wins, this would mean a big regulatory upheaval and a more interventionist policy.

There is little doubt that the prospects of a Labour government makes the industry most nervous. The Tories and LibDems favour a market based approach – everything can be cured by switching supplier. Labour’s interventionist approach, while still market based, includes an energy price freeze along with new powers for the energy regulator to force firms to cut gas and electricity bills. This is just the first step towards making the energy market work better for consumers rather than producers.

We should also not forget the the influence of the Big Six energy companies in Whitehall. As Sir Jonathon Porritt has highlighted, it is so strong that they are dictating policy and preventing the electricity system from getting the radical overhaul it desperately needs. One of Ed Miliband's greatest strengths is his willingness to take on powerful interests like Rupert Murdoch or the power companies, even when the easy option would be to fudge.

On generation policy in Scotland, the biggest difference is an over reliance on renewables, mostly onshore wind from the SNP, while Scottish Labour favours a more balance energy policy. This election is unlikely to make much difference to that dividing line, although Energy Market Reform mechanisms could be used to incentivise different approaches.

Of course the cheapest unit of energy is one you don’t use. Cutting energy waste should be the first move in any programme to reduce emissions – not least because it also reduces bills and improves energy security. Scottish Labour's plan is to work with local authorities, housing associations and installers to support local area based energy efficiency schemes, retrofit existing properties as well as building more than 20,000 energy efficient new homes per year by 2020. They will regulate to drive up energy efficiency in the private rented sector and further develop micro-generation schemes, so that alternative energy supplies are more accessible. The SNP’s idea of funding the ECO scheme, which helps some of the poorest households, from taxation rather than energy bills, has public spending consequentials, but probably isn't a big political dividing line.

Energy Action Scotland supported by UNISON Scotland have asked all the parties a series of questions about fuel poverty. While there is a degree of fudge in some of the answers, there is also a welcome consensus on some strategies.

There is a certain irony in Tory energy policy during the coalition years. Energy Market Reform has been highly interventionist and will be for many years to come. Even the Tories recognise that the market simply hasn't delivered the power generation we need. Labour recognises market failure and is planning to intervene through direct measures like the price cap and indirectly through a stronger regulator. It's still too reliant on the market in my view, but an important step in the right direction.