Robin McAlpine: There is a giant corruption at the heart of Scottish life and we need to fight it


Common Weal director Robin McAlpine argues that Scotland is being eaten from the inside by the legalised misappropriation of public money

THERE is an enormous, all-pervasive and all-encompassing corruption at the heart of public life in Scotland and this corruption is so deep, so wide, so entangled that no-one has the courage to face up to it.

This isn’t the petty corruption of back-handers and jobs-for-the-boys; it’s much worse. It’s not about using the system corruptly, it’s the system itself having been corrupted. Like corrupted computer coding, once the corruption is embedded it will produce a corrupt outcome no matter what the input.

That corrupted outcome is that almost every time the public sector in Scotland tries to spend money an undue proportion of that money is funnelled into the bank accounts of a group of very rich people.

“It’s not corrupt, it’s legal”, some will protest. Yes, it’s legalised corruption. The public has been forced (by law) to pay sums for work done it is simply impossible to justify, all based on promises that the recipients of the money had no intention of fulfilling (like claiming they’d shoulder all the risk of big public projects). It’s extortion.

Unfortunately, this is not the kind of ‘missing £5k’ that gets people arrested in Scotland; it’s the kind of ‘missing £30 billion’ that gets absolutely no-one arrested in Scotland ever.

I’m of course referring to the scandal of PFI and its many pseudonyms. For 20 years now I’ve been one of many people who have written repeatedly about the outrage of this system. Every prediction of failure we made has been proved absolutely correct, and the forensic analysis of how money was filtered out of the public realm for no reason is extensive (I think about half a dozen Common Weal papers on the subject alone).

This week I chaired the launch of a book by the respected academic Dexter Whitfield which documents the sheer global scale of this outrage in 500 pages of painstaking detail (there are 83 pages of densely-spaced references alone…).

That this is a scandal isn’t a debate but a fact. It’s not and never has been just the Left which is appalled by this whole affair – the most recent body to highlight the full scale of the scandal is Audit Scotland. ‘Damning’ is insufficient to describe the contents. This is tens of billions of pounds of your money handed to financiers for no real reason other than that the government rolled over.

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If this doesn’t constitute theft it really, really should. But the cost is only the start. Over and over again the quality of the work is shown to be substandard and contracts are shown to be defaulted on.

Of course, the scale of broken contracts is hard to measure because they are completely secret (and are generally written in conjunction with the contractors anyway). This system is so dirty, so distorted that all lines of accountability are actively written out of legislation. Both sides ‘agree’ not to sign off the work properly or to pursue contract defaults.

(It’s worth remembering that one side of this is you, the public, represented through the employees of public bodies who are supposed to act as agents on our behalf, not as ‘corporate partners’.)

No-one is ever taken to court no matter what happens. No-one is ever named and shamed, because you don’t name-and-shame leading financiers or construction corporations. It’s like the medieval church. I mean, anyone seen the result of the inquiry into the Edinburgh schools falling down? That was nearly four years ago now and it feels like they’re hoping you’ll forget it happened.

Dozens upon dozens of outright scandals have taken place, but on every occasion it is as if a CIA clean-up squad has been sent in – the bodies disappear, the fingerprints are wiped clear, the physical evidence is burned… Public servants and big business work together to disguise any evidence that might show wrongdoing.

Why? It’s easy – the dirty, corrupt system has spread its tentacles into absolutely every single part of Scottish public life and has made everyone complicit. It is everywhere, omnipresent. It really is like a shadow state, lying just underneath the visible state, sucking the life out of the public realm, weakening it and making the host more and more dependent.

The civil service has its policy capacity shrunk and then outsources it to KPMG or PWC which then propose outsourcing or PFI or privatisation or reorganisation. This is then passed to the network of private finance companies which work hand-in-glove with procurement officers to design and sign off contracts.

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It has been made absolutely clear by 20 years of consistent practice that there will be no consequences for failure or malpractice, so boundaries are pushed and pushed until they don’t exist any more.

Then this corruption spreads and spreads. The public sector can’t buy a pencil in Scotland without being pulled into this shadow system where at times it is difficult to tell where the public sector ends and the private sector begins.

Because once the profiteers won on public infrastructure the precedent was set; the public realm is a series of financial assets to be ‘sweated’ by the financial sector.

Procurement is a cartel opportunity, public space is a rental opportunity, universities are a property development opportunity, hospitals are an outsourcing opportunity, asylum seekers and ferries and school meals and prisoner transfers are just money in disguise. You get your hands on them and you squeeze and squeeze until the money is all gone and then you discard the broken husk for the public purse to deal with.

We’re reaching a kind of endgame in which it seems to have been decided that Edinburgh as a whole is no longer a city for residents but an asset to be stripped.

Everything is run for profit extraction. It is routine now for government officials to talk unselfconciously of ‘Scotland PLC’, the nation as a whole managed as a single enterprise with the public and private functions no longer separate.

As so often in Britain, they tested this corruption out on Scotland first with the Skye Bridge under Michael Forsyth. But without a shadow of a doubt the real culprit here is Gordon Brown and I still look forward to the day he is properly held to account for what he did.

In the late 1990s, Brown took this financier’s wet dream of unrestricted, unsupervised access to massive amounts of public money and made it so it was the only legal option for Scotland. Henry McLeish’s administration fought back and I believe to this day that Brown effectively had him removed as a result.

From there on it became just a fact of life. Jack McConnell’s administration reluctantly went along with it since it had no option. The SNP came in promising reform but bottled it. Facing the machine (much of it made up of their own officials), they made a tiny reform and then were assimilated.

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If you don’t know, that slightly-reformed NPD model was scrapped last spring and replaced with an even more insidious system (Mutual Investment Model or MIM). Naturally this was done with almost no serious democratic oversight and was barely announced. It’s your money but it’s treated as a private matter you have no need or right to know about.

This history shows the problem; the system isn’t political, its extra-political. It’s a network of financiers, lobbyists, accountants, lawyers, corporations, service vehicles (like Serco), shell companies, property developers, events companies and all the rest which exists untouched as politicians come and go.

The sheer number of people who are now complicit is petrifying. If you have had a 20-year career in public sector procurement, infrastructure development, facilities management, IT delivery, planning, policy development, welfare service delivery, health service management, cultural services and much else, you have never experienced anything other than this way of working.

I’ve explained aspects of this corruption to public officials who have looked at me blankly. They say things like “you’re not seriously saying that the terms of a PFI contract should be public, are you?”. When I say “obviously they should”, they look at me like I’m from the moon. That’s what corruption does.

From some junior planning officer to the top civil servant, they live deeply integrated into this whole dirty system. Asking them to consider it is like asking a fish to consider water – there’s nothing to consider, it just is.

I’ve had about enough. Rational argument doesn’t work when so much wealth is there to be pocketed. The public needs to fight back because the politicians seem utterly feart and I’m afraid civic Scotland is up to its neck in outsourced contracts too.

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This could all be brought to an end very quickly. Common Weal’s domestic policies are woefully under-exposed. We’ve published a full set of carefully designed policies which would not only end this whole scandal but replace it rapidly with an alternative system which works in the public interest.

The Scottish National Investment Bank is on its way and it must be given the powers of a full bank so it can unlock serious money; that should be where the finance comes from. The process of advising must be taken out of the hands of the Scottish Futures Trust and given to a National Infrastructure Company which is driven not by enriching financiers but by quality of building.

There’s too much to link to here, but for example a national Statistics Agency should provide proper transparency data, a National Energy Company and Energy Development Agency lead a public-good energy system, a programme of land reform and planning reform should take the profiteering out of development.

Procurement must be reformed to favour medium-sized domestic businesses. The civil service must end the practice of giving contracts for policy development to the private sector (especially the big accountancy firms which are up to their necks in every square inch of this scandal) and the money should be used to recruit in-house policy teams working in the public interest.

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And above all Scotland must wake up to the fact that democracy is being rolled back, commercial lobbying is becoming more powerful, the media is dead on its feet and is barely holding any of this accountable and transparency is constantly being rolled back – and then do something better.

Common Weal has produced policy on all of this and more. We have worked assiduously with the grass roots of the SNP and most of the above policies have been passed as official party policy. SNIB is on its way and I have high hopes that SNIC will follow when the Infrastructure Commission is finished its work.

There is only one thing that scares me more for poor Scotland than the prospect of another ten years of London Tory rule – and that’s Scotland being eaten from inside by this insidious beast. We can defend attack from outside but not a parasite we can’t even see. It will destroy the very foundations of Scotland as a nation. It really is that serious, that much of a crisis.

I repeat: I’ve had enough. There has been lots and lots of talk about reform and protest, but there is only one organisation in Scotland which has produced and campaigned for a serious, consistent and workable alternative to this whole mess and it is Common Weal.

Please, if you’ve had enough as well, will you donate to us so that there is at least one organisation equipped with the resources, vision and courage to fight?

Because this corruption is about even more than the misappropriation of massive sums of public money. It is about Scotland’s viability as a nation state fit to deliver a public realm for its citizens. It is that fundamental.

Fight with us or you will live to regret it.

Picture: CommonSpace

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