Sunday 19 October 2008

Things getting difficult for the SNP

There is little cheer for the nationalists in this Sunday's newspapers. In reporting the comments of Professor John Kay, "Scotland on Sunday" sort of sums up the general theme :

'An independent Scottish economy would be "awful" in the present financial climate, one of Alex Salmond's key economic advisers said last night. ... Kay, a member of the First Minister's Council of Economic Advisers, criticised the SNP's vision of an independent nation, saying he was not interested in "flag-waving, embassies and armies".'

And Iain Macwhirter in the "Sunday Herald" (not exactly the SNP's greatest critic) says :

'Certainly, the Nationalist government is no longer a novelty, and is getting into the kind of difficulties all governments get into in mid-term - acquiring daft policies like trying to make it illegal for young married couples to buy a bottle of wine at an off-licence. The magic is fading, and policies like free school meals and local income tax are in difficulties.'

Absolutely true. Leaving aside the rather obvious point that Scottish separation from the rest of the UK makes no economic sense, the biggest problem I feel the SNP government faces is that it lives for tomorrow's newspaper headline and does not plan for the medium and long term.

The SNP Scottish Government is getting itself into a bit of a guddle - a few examples :

* It opposes Public Private Partnership capital funding, ends it, resulting in a premature end to much needed further infrastructure improvements to schools and hospitals, but has nothing but a myth to replace it. The Scottish Futures Trust is unreal, it doesn't really exist, and far from matching the building programme achieved under the former LibDem/Labour Executive, the "brick for brick" promises of the SNP have proved to be empty rhetoric. Actually, no bricks at all from Mr Salmond.

* Makes a total guddle of its proposals for a replacement for Council Tax - erroneously claimed to be 'Local Income Tax' but actually a Scottish National Income Tax (or should that not be "Scottish National Party Income Tax"!) And, in true tabloid fashion, in the face of universal criticism of its decision to tax students, the SNP rushes out some media spin to suggest they may be exempted, making a policy already £742 million short of being affordable (CIPFA's figures, not mine) even less affordable. The SNP decision to charge students local income tax in the first place was plain daft, but you'll note that John Swinney hasn't quite worked out how he'll pay for now exempting them.

* Creating a lot of media spin about assisting affordable housing in Scotland, that, behind the spin, has seen little delivery on the ground. Housing Association capital funding in Dundee was cut by 46% by the SNP government for 2008-9. SNP politicians in the city have failed to campaign to reverse this cut showing that either they have little influence with their own government or they haven't bothered to speak up for Dundee.

* The Concordat between Scottish Government and local government is beginning to fall apart as John Swinney washes his hands of any responsibility to help local government meet the financial pressures caused by the local government pay dispute and also to pay for SNP government policies, such as the free school meals for P1-P3, which local government is finding hugely difficult to finance in the current challenging budgetary situation all 32 councils face. Other SNP policies - the class sizes reduction is a prime example - are another media myth - great spin for a press release, but unfunded and therefore undeliverable.

One bit of better news from the SNP in today's papers - to quote the "Sunday Herald" - 'Salmond supports call to rethink HBOS deal' - about time that the First Minister is finally coming round to this realisation, but didn't Tavish Scott call on him to do so back on 9th October? Here's the exchange at First Minister's Questions earlier this month :

Tavish Scott: Yesterday's enormous financial package will be judged on what it does in the real economy: its impact on personal lending, individual deposits, bank credit to business, and jobs around the country. HBOS will now be a taxpayer-supported institution. When the First Minister said three weeks ago that the Lloyds TBS merger with HBOS was "the only game in town", he was right, but that is no longer the case, is it?

The First Minister: I have made it clear that my preferred position for HBOS would be for it to remain as an independent bank. We can speculate that, if the measures that were announced yesterday had been in place some weeks ago, perhaps different decisions would have been made. However, the reality is that there is an offer to shareholders, which the Government supports. The offer will therefore be decided on by the shareholders of both banks.

Where some lead, others follow ...