Why Scottish independence is crucial for the future of local government

For all that Scotland has led the way on issues from the smoking ban to equal marriage to the Scottish Child Payment, it is hard to point to unalloyed economic successes. Yes, Scotland has done a great job of shifting from coal to renewables, but the jobs bonanza that should have accompanied it has only just started to arrive.

Anas Sarwar’s observation about the Scottish ­Parliament’s focus on social policy invites discussion. And it is a discussion we need to have. Of course, we need to be clear that when Labour claim to be the party of devolution, they also take responsibility for the lack of economic powers to do anything other than be a social policy parliament.

It could have been so different.

As we commemorate the 40th anniversary of the miners’ strike, it is worth looking at how ­devolution came about. And that has at its heart a demand by Mick McGahey from the Scottish area of the ­National Union of Miners (NUM). 

McGahey was a towering figure of the labour movement in the ­second half of the 20th Century. His 1968 speech to the Scottish Trade Union Congress (STUC) General Assembly was the first step toward moving the labour ­movement towards accepting devolution.

McGahey argued that a Scottish Assembly would be able to protect Scottish industry from the attacks of Conservative governments elected in England. His foresight was impeccable.

The Labour Party were very sceptical about ­devolution in the post-war period. Labour were so sceptical that their MPs amended the act that should have delivered us a devolved assembly in 1979 to ­require a qualified majority – a move which both scuppered the Scottish Assembly and brought down James Callaghan, the then Labour prime minister.

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And without a Scottish Assembly to protect it in the long, brutal years of Conservative rule, Scottish industry was deliberately undermined. From the closure of shipyards, coal mines and steel plants to the utter failure to maximise the public benefits of oil and gas in the North Sea, things could not have been worse.

That the surplus from Scottish oil and gas was used to fund deindustrialisation added insult to injury.

But at the same time as Scottish industry was ­being obliterated by Margaret Thatcher, the case for ­Scottish ­devolution stayed alive and, eventually, thrived. Through the 1980s and 1990s, groups were busy working on building a movement for devolution.

The number of representatives, the electoral ­system, the committee structure, the powers of ­devolution, early drafts of the standing orders for what became the parliament – all of these were developed by committed groups of campaigners. As was a clever approach to deciding on powers, which helped the process.

The parliament would have power over everything that was not on a “reserved list”. This reduced the wrangling over which issues were to be handled by which parliament. Tax raising was contentious and resulted in a second question on the 1997 ­referendum. But quietly, without much discussion, “macroeconomic powers” were placed on the reserved list.

That meant that power over Scotland’s industry was retained in London. So is it really a surprise that the parliament focused on social policy?

We need more power over our ­economy. And that is a greater burden for our parliament. But we could also give more power away. Power to ­communities, and power that can be democratically controlled much more locally.

The Scottish Government has done great work on piloting participatory ­budgeting, where people get to determine how money is spent by local councils. But this needs to go much further. The point of participatory budgeting is to build ­public trust in public spending. We need to take this approach and use it much more widely. It should underpin most of our decisions.

The climate crisis will require much more resilience and much more collective spending on local energy and measures to protect us from extreme weather events.

There is a very good case for changing the financial arrangements where the highest level of government taxes us most and then that money trickles down (­maybe), along with a range of political impositions from the government. Council tax accounts for less than 20% of local government expenditure, much of the rest comes in a grant from the government. We should find ways to reverse that ­relationship.

Most locally spent money should be raised locally, with adjustments for ­geography and deprivation.

The UK Government is currently pursuing a vendetta against the four-day working week. South Cambridgeshire District Council has implemented the policy – to enormous success. It more than pays for itself as the number of sick days decreases, productivity goes up (often more than the 25% required to make up the extra day) and the cost of employing agency staff goes down.

It is as close to a perfect policy as it is possible to have. But because central government in Westminster controls the purse strings, it can make life very difficult for the council.

This is to the detriment of everyone, except perhaps the wealthy owners of the recruitment agencies that provide ­temporary staff at enormous cost to local government.

There is an alluring, but wrong ­assumption that centralisation is the same as solidarity. Anyone who ­attended a ­debate during the ­independence ­referendum heard that we should stand with people in Liverpool, ­Newcastle, or any other left-leaning English city, and that meant being governed from London.

Of course, Scotland has a long ­history of standing with people beyond its own borders in South Africa, in Chile, in ­Palestine. We are an internationalist country. We did not need to be in the same country as Nelson Mandela to give him the Freedom of the City of Glasgow, to impound fighter jet parts being used to terrorise the people of Chile, or to twin Dundee with Nablus.

This is at the core of the argument for devolution. The question we need to ­address is whether the powers we have are the right ones. And whether the ­existing powers of the Scottish Parliament could be better devolved to communities.

Scotland has some of the least local ­local democracy in Europe, and it shows. Denmark – the film by Lesley Riddoch (above) – sets out just how different it could be. And while some have suggested the ­answer is to make local democracy even less ­local, we disagree. But the answer is not to ­diminish the Scottish Parliament. It is to make our parliament more strategic – to give it more powers to do the things that should sit at a national level. And first and foremost that means economic powers.

We face a number of massive ­challenges over the coming decades, and we need to have a serious conversation about ­whether the powers of our parliament are up to dealing with those. The biggest, of course, is the challenge posed by climate change and the energy transition.

Scotland is fantastically placed to ­benefit from an energy transition, with ample wind and water resources and the ability to harness them. We have done brilliantly at getting renewables installed – and very often our grid is running at or near 100% clean electricity. ­Electricity is a little more than a fifth of the energy we use, though, so we need much more ­installed capacity.

Delivering a transformation of our energy system requires local ­government to site the new facilities, and it means a national government that can ensure that as many of the jobs ­building wind turbines are sited in Scotland as possible.

We need a national ­government that can supply the capital, as well as design the training courses for engineers and site strategic manufacturing for the decarbonisation of heat. And we need local ­government that can take people with them on local heat networks, ­insulation, heat-pump ­installation and all the other things we need to do to provide ­zero-carbon heat – which makes up a little more than half of our ­current energy use.

Rather than more local democracy ­being an obstacle, it will be a catalyst.

Another example of where we could do things better with more democracy is in the provision of ferries. Where once the Clyde was the global centre of ship ­manufacturing, the current ­embarrassing failure to provide ferries to CalMac points to the need to improve industrial strategy.

If McGahey gave us the blueprint for a Scottish Parliament focused on ­Scottish industry, Jimmy Reid gives us a blueprint for what to do here. Reid, the other great Scottish trade unionist of the last ­quarter of the 20th century, led a work-in at ­Upper Clyde Shipbuilders in the 1970s. The workers took over the management of the shipyards in the face of a management plan to close them. The work-in not only protected the shipyards but also increased productivity.

Where the current mess is a result of the government leaning heavily on billionaires and then accountants, the workers have been excluded. But it’s not only workers that are excluded. The communities that use the ferries have no way to select the board of CalMac.

A successful industrial strategy would build on the experience of workers, ­giving them a much greater role in the ­management of businesses. It would also reflect the needs of the ­communities that use the ferries – or indeed any other ­services. The replacement of ferries for the Clyde islands, the Hebrides and the Northern Isles should create work in ­perpetuity for a Scottish shipyard.

We know that the UK is approaching its third decade of stagnant ­productivity. The economic model that was created by Thatcher and refined by Tony Blair and Gordon Brown has proved ­impervious to the various post-crash resuscitation plans.

Since then, we have had David ­Cameron (above) and George Osborne’s ­austerity, Boris Johnson’s Brexit Britain and whatever Rishi Sunak is up to. All have the same outcome – more stagnation. It is time to do something different.

This would give life to the ­aspirations that most Scottish people and most ­Scottish parties would want. It will ­deliver a wellbeing economy, it will go a long way to achieving fair work, it will increase productivity and ensure that we reverse some of the problems of rural ­depopulation. And if done right, we can still secure economies of scale when they deliver.

It all seems so obvious. Yet it has proved very hard to deliver. Why is that?

The last round of local government ­reorganisation in the 1990s was difficult. The move from regions and districts to our current 32 unitary authorities ­resulted in confusion, the disruption of grants for the voluntary sector and left an aversion to reorganisation.

The widespread scepticism about ­politicians also makes this a hard sell. But our aim is not to create more ­politicians, it is to get more people involved in the ­governance of our lives. Be that through empowering workers to lead their ­workplaces, or giving people more say in the running of their communities.

The alternative is not fewer politicians, it is more distant, unelected people making decisions that pay insufficient attention to the impact of those decisions.

That’s why Lesley Riddoch and I – and a number of others – are organising an event later this year.

We are going to take a ­deliberative approach, putting these ­issues in front of people so they can ­examine these ideas, shape them and ­create a set of ideas that can help us to move from the very successful “social policy parliament” to governance based on a twin devolution of economic powers to Scotland and local powers to new local government.