Source Direct: For the Love of Money

Forbes styles the Scottish budget as continuing a “progressive and restorative approach”. Conversely, Larry Flanagan, head of Scotland’s main teaching union, spoke of “an effective pay freeze”. And critics led by the STUC say key workers have been “left out in the cold”.

SOURCE WILL FEATURE ANALYSIS of the Scottish budget throughout the day, as public spending dominates the headlines. I am thus focusing on just one controversy arising from the budget: public sector pay. Prior to the pandemic, then finance secretary Derek MacKay admitted that public sector wages had experienced (in real terms) a decade of decline. Austerity, to nobody’s real surprise, had left much of the country poorer. But he promised that the Scottish Government was on a “journey of restoration of public sector pay”.

Since then, three things have shifted political calculations. First, MacKay lost his job after a sordid scandal, with Kate Forbes assuming his duties. Second, we experienced the pandemic and perhaps the most extraordinary economic collapse in capitalist history. Third, during the pandemic, decades of anti-public sector propaganda fell away amid a national outpouring of respect for “essential workers”. Even the red-top tabloids, having spent generations screaming about fat cat teachers and nurses, sang hosannas to the brave soldiers in our schools while drumming everyone into a frenzy of clapping for carers.

Yet for all this outpouring of love, those workers were just getting back on their feet after a decade of brutal punishment beatings. TUC figures (caveat: not covering Scotland) show that many groups of key workers are over £1,000 worse off than a decade ago. In real terms, firefighter salaries fell by over £2,500; refuse collectors by over £1,500; care workers by just shy of £1,500.

Conversely, the private sector is collapsing. Taxi drivers, retail workers and a whole host of others have their own distressing tales to tell. Scottish economic activity is down 7 percent on pre-pandemic levels. Recovery will take years.

Forbes thus had a tricky task. And while she was praised, relative to her predecessor, for her refreshingly jargon-free delivery, the result was a mixed bag. Supporters point to a minimum 3 percent increase for those earning under £25,000, the lowest paid tranche of the public sector, capped at £750. Conversely, those on higher rates will get a 1 percent rise.

Forbes styles this as continuing the “progressive and restorative approach” after that decade of falling pay. The National, with its chummy optimism, calls it a “pay hike”. Conversely, Larry Flanagan, head of Scotland’s main teaching union, spoke of “an effective pay freeze”. And critics led by the STUC say key workers have been “left out in the cold”.

That upper branch of the public sector, receiving the 1 percent increase, includes most teaching staff, firefighters and civil servants. These are pillars of communities experiencing the brunt of the pandemic, rather than gold-plated elites watching the coronavirus on laptops from the comfort of their lawns. And even the poorest layer of public sector workers are arguably being squeezed: their 3 percent should be compared to a 4 percent real terms increase in the Scottish Budget.

So it’s something of a raw deal, after an extravaganza of national hype about loving our public servants. The only defence would be, everyone has it tough (excepting the billionaire tech bros at the top). Hopefully the unions will respond effectively with collective action on behalf of both public and private sector workers.

The alternative scenario may be too grim for many to contemplate. But it is increasingly hard to avoid. Perhaps our ageing economic system simply can’t afford social justice anymore. Perhaps it’s too haggard and sluggish to face new challenges with vigour. And perhaps it will take another decade of falling incomes before we are really forced to confront those realities.