SNP's Record in Government Means They Can't Be Trusted With Full Fiscal Autonomy


One of the hot topics for the SNP these days is whether or not to demand Full Fiscal Autonomy from the UK government. Politically they have to. If they do not ask for Full Fiscal Autonomy, if that is not the highest thing on their agenda in this post-referendum environment, then it rather calls into question the whole project of an independent Scotland -- still the SNP's long term goal. It certainly undermines the argument they made in the run-up to the referendum last year that Scotland can prosper independently as a high-public-spending social democracy. And on this notion, the notion that Scotland is in fact being held back by "Westminster," rather than helped to the tune of approximately £8bn a year through the Barnett formula, that the entire edifice of SNP successes recently has been built.

But of course, things are not that simple. Nicola Sturgeon has indeed been happily touring US TV stations telling the American public that she is all in favor of FFA, as she must, but at home, even some of her newly elected Westminster roster, notably Tommy Sheppard, freely admit that suspending funding under the Barnett formula would be a "disaster" for Scotland. That funding arrangement enables higher public spending per capita for Scotland to the tune of 20% -- or in other words, take away the Barnett formula and grant Scotland Full Fiscal Autonomy, and suddenly it can no longer afford one sixth of the public spending it currently enjoys. If you thought that the Tories' austerity is bad, wait until you see the fiscal crunch a fiscally autonomous Scottish government would have to contend with.

The SNP's usual reply to these concerns is that of course losing the Barnett subsidy will hurt, but with the right kind of management of the economy and its natural assets, with the right kind of policies to take advantage of newly gained fiscal freedoms, Scotland can mitigate these negatives quite easily. Or in other words, "trust us, we'll overhaul the entire economy and taxation system, we'll have high growth, booming productivity rates and booming oil prices and everything will be just fine". And sure enough, that scenario is, technically, possible. But how likely is it really?

One has to say that recent figures on the SNP's track record in government in Scotland means that the SNP vision of a land of milk and honey is even less likely than you might have thought -- especially if it will be the SNP who tries to deliver it.

Recent figures on the crucial devolved areas of Education and Health, areas over which the SNP has governed for the last 8 years, make for grim reading. On the NHS, an analysis by the IFS has shown that the SNP have cut spending in real terms over the period of the last 6 years by about 1%, even as the "austerity-mad" Conservatives-led coalition has increased spending in real terms by 4%. The upshot is that Scotland has one of the worst health outcomes of the developed world and the SNP is rightly, at last, being taken to task by the opposition in Holyrood over its failures to meet their own NHS goals for years.

The picture is very similar in Education. Only last month, Angela Constance, the Scottish Education Minister, was forced to admit that literacy and numeracy standards in Scotland are falling, while attainment inequality between children from wealthy and poor backgrounds in state schools remains persistently high after the SNP's eight years in charge. And this again coincides with spending cuts that were not imposed in the rest of the UK. It is hardly surprising that we are doing so badly at social mobility. Also, not very encouraging for plans to raise productivity and economic growth. How exactly are we going to do either of those things when educational standards are slipping behind the rest of the UK?

But who knows, maybe the SNP will manage to massage the official figures on growth and productivity, in the same way they did the figures on Crime, another area of devolved responsibility where Scotland is underperforming. And if we're lucky, our international creditors will not look under the hood while we borrow to fund the fiscal shortfall that will come from Fiscal Autonomy.

The trouble is this. Somehow, the SNP has built a reputation for seriousness and competence in government, and this is the collateral on which they want us to mortgage our country. And sure enough, you do have to give the SNP credit, where credit is due -- they have been extremely competent at waging the rhetorical and political war in the run up to the referendum, and since. They have won the hearts of a huge section of Scotland's people. But when it comes to their competence in government, that is another matter altogether. And the cold, hard statistics make dire reading to sober heads -- and make having faith in their promise of a utopian social democracy impossible.