Craig Dalzell: Gathering thoughts on the Growth Commission

Ben Wray

Common Weal head of policy & research Dr Craig Dalzell looks at the grassroots indy consultation on the Growth Commission which began at the Gathering on Saturday, and finds there is more to take issue with in the report than just the currency plans

THIS weekend over a hundred independence activists arrived in Stirling to take part in the second annual Gathering conference led by the National Yes Registry. This event was billed as the starting point for grassroots consultation on a range of topics to do with the independence debate. Some of these discussions will revolve around subjects raised Sustainable Growth Commission’s report earlier this year and at the SNP National Assemblies, but unlike those prior events the Gathering was open to more than just SNP members and therefore was able to represent the opinions of the wider Yes Movement on the Growth Commission’s proposals for independence. 

Keith Brown opened the event with a short speech on ongoing efforts to make the case for independence and on the Growth Commission report. Notable was his statement that he had heard very significant critique of the Growth Commission’s plans to Sterlingise Scotland’s economy for an extended period of time post-independence. He also mentioned that as the National Assemblies had progressed, the opinion in the rooms had softened somewhat, suggesting that whilst a decade long transition would still be opposed, a shorter one might be more acceptable. This does not seem to accord with the opinions of almost any of the Assembly delegates I have spoken to since those meetings but it piqued my curiosity as to how the Gathering would approach this question.

Common Weal was not invited to officially represent our opposing view of the Sterlingisation plan – the event was never designed to be that kind of debate – but it appears that our presence was hardly required, as when the currency group reported back the conclusion of their discussion was a complete and unequivocal rejection of the Growth Commission on the grounds that not taking control of our own currency and by binding Scotland to the Growth Commission’s fiscal rules would “undermine the prosperity [of Scotland]” and that therefore: “At the earliest opportunity we have to build a robust financial framework to allow us control over our currency.”

READ MORE: Grassroots Yes consultation finds Growth Commission currency plans would ‘undermine” indy prosperity

Keith Brown also mentioned in his speech that he regretted that currency had become such a high profile and controversial topic (I wonder if he would have held that opinion had the argument not gone so harshly against the GC report) and that he’d also like to talk about the other proposals in the Growth Commission report such as the tax system of an independent Scotland.

I’m happy to do so. Common Weal has already published our principles on which an independent Scottish tax system should be based. One thing that is perfectly clear is that we cannot take a “soft independence” approach to tax any more than we can afford to take one over currency. It would be easy to assume an approach of copying the UK tax code into an independent Scotland and then tweaking and reforming it from there. That would allow a “fast transition” to independence but it is a flawed approach that would cast a shadow for decades afterwards.

The fact is that many aspects of the UK tax code might well work for the UK but simply would not work for a smaller country with a different economy and outlook. And it goes without saying that some very important aspects of the UK tax code do not work even for the UK. The recent UN investigation into poverty in the UK specifically said that the country was more than capable of eliminating poverty within itself but had made the political choice to give tax cuts to rich companies and individuals instead.

READ MORE – Richard Murphy: Tax in the Scottish Growth Commission report

Copying this approach – even with the intent to reform – would be a missed opportunity for Scotland. We cannot forget that the political capacity to reform a tax code once written is extremely limited. Witness, for instance, the huge political stramash resulting from the Scottish Government’s attempts to adjust income tax by very nearly the smallest amount possible. Imagine trying to overcome that hurdle for everything else and you’re looking at a project that could dominate Scottish politics for decades or, rather more likely, simply fall by the wayside and never happen. If we want independence, we should not start from there.

This “soft” approach extends to other areas of the Growth Commission such as their take on financial regulations. We’ve seen the failures of UK financial regulation – especially in areas such as their inability to prevent banks from deliberately bankrupting their customers and seizing their assets – and therefore it is utterly unacceptable that an independent Scotland should not just start life by copying the UK’s regulations but that it should, in the words of the Growth Commission, “mirror” rUK’s and continue to develop them “in line with changing rest of UK…requirements”.

Of course, companies will want certainty over how regulations and frameworks should be handled in an independent Scotland but certainty need not imply an independence built on static helplessness. We should grasp the thistle of our independence and build the frameworks that work for our country but do so in a way that is well planned and laid out ahead of time to allow companies to adapt to the new changes.

Keith Brown’s speech on Saturday mentioned that the results from the Gathering events and the National Assemblies would be taken back and considered and that the SNP members would likely have a vote on the Growth Commission at the party’s spring conference. We don’t yet know how this debate will take place, whether the report will be adopted or rejected in its entirety, whether it may be amended and adapted by members or whether portions of it can be considered in isolation. I would hope to see some clarity on these plans ahead of the conference, but however that final debate is structured, I hope that members will engage as they have done up till now in an informed a manner as possible.

Common Weal will continue to endeavour to play a part in these positive discussions so that the case for Scottish independence can be made as strongly as it possibly can be.

Picture courtest of Robbie McDonald/IScot