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Parties’ promises are cheap when there is no pressure to pay for them

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The results are in. Nicola Sturgeon and the SNP will be running things in Scotland for a while yet. While they may not have quite secured an absolute majority, all the talk about Scotland south of the border is still about the prospects for a second independence referendum.

Indeed, if you are living in England or Wales you could be forgiven for knowing nothing more about the choices that faced the Scots at last week’s election. It’s worth taking the time to understand a little about them. A look at the manifestos not just of the SNP, but of Scottish Labour and Scottish Conservatives too, reveals just how far the consensus in Scottish politics has diverged from that in England.

Things have been different for a long time. No university tuition fees for the Scots. The personal care elements of social care are free for all, not heavily means-tested. Overall spending per person is about 30 per cent higher than it is in England. That remarkable difference is almost entirely a reflection of additional funding flowing north of the border from the UK exchequer as a result of the Barnett formula. Funds also flow to poorer English regions, and to Wales and Northern Ireland. But those flows compensate for low levels of income. Scotland is not poor. A Barnett formula based on “needs” would transfer much less to the Scots.

The SNP has increased income tax a bit and made it more progressive. Extra tax revenue, though, has played almost no role in paying for higher spending. Most of the modest extra revenue from the higher tax rates has been offset by lower growth in Scotland resulting in less additional revenue than hoped for.

Extra funding allows for higher spending across a whole range of services. Some of the welfare cuts experienced in England and Wales have been ameliorated by Scottish government decisions. Spending per school pupil is about £1,000 more. Spending per person on transport, environmental protection, culture and housing is between 40 per cent and 90 per cent higher than in England. That doesn’t always translate into better outcomes. Despite being free, participation in higher education has increased less quickly than in England. Despite the extra spending, international comparisons suggest Scottish pupils have fallen behind their English counterparts.

So the Scots went into last week’s election with a bigger, more generous and more universal welfare state than in the rest of the UK. The three main parties were united in promising to extend it further, with big promises on social care, childcare, education and employment. Just to give you a flavour. Scottish Labour was promising to head towards 50 hours a week of free childcare for all pre-school children, free bus travel for the under-25s, with an aim to be free for all at some later date, and a £15 an hour minimum wage for care workers. On the SNP’s list of promises were free dental care and free breakfasts and lunches all year round for all primary school-age children. Labour also promised the latter and the SNP matched Labour promises to abolish all charges for all social care services received at home. The Scottish Conservatives’ spending pledges were more modest, in part because they were promising tax cuts. Even so they also promised to make breakfasts and lunches free for all primary school children and to provide more free childcare.

The parties were also united in promising more generous social security benefits. They all pledged to increase the Scottish child payment. You may not have heard of it. It is a new benefit introduced this February which gives an extra £10 per week per child aged under six to families on universal credit. It is due to be extended to all children under the age of 16 by 2022. All parties promised to increase it from £10 to £20. Perhaps an even better sense of the extent to which Scotland is a different country is the fact that all the main party manifestos talked in positive terms about a universal basic income — something which, for very good reasons, exists nowhere in the world.

That of course was the point of devolution — to allow Scotland to make different choices. But where were all the parties intending to get the money from to pay for all these goodies? Not a question which Scottish Labour or Conservatives will have to answer. The SNP will need to, though. Here I’m afraid Scottish politics is not so different from the English variety. Actually, it’s worse. We have come to expect some, admittedly often feeble, effort by the main parties to cost their manifestos at UK-wide general elections. In seeking election to Holyrood, the Scottish parties clearly don’t feel the need to make even that much effort. You will search in vain for the costings of many of the key policies in the SNP manifesto or for anything beyond the first year of a five-year parliament in Labour’s. No hint of tax rises to pay for spending increases.

Big increases in English spending resulting in big increases in “Barnett consequentials” — ie, more money flowing from the rest of the UK to Scotland — could do the trick. It looks highly unlikely though that the UK government will increase spending anywhere near as much as would be required to fund Scottish promises.

Scotland can have an even more comprehensive, generous and universal welfare state than it does at present. That’s what the Scottish people voted for. It has the power to raise the tax to pay for it. If the ambitions and promises are real then that is what the Scottish government should do. It will perhaps prove easier, though, to ignore that possibility and blame others when funding proves inadequate. The power is there, but so is the opportunity to abrogate responsibility.

This article was originally published in The Times and is reproduced here with kind permission.

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MPCs were directly elicited from a representative sample of UK adults in July 2020 using receipt of a hypothetical unanticipated, one-time income payment. Reported MPCs are modest, around 11% on average.