To this end, this week Miriam Brett and I published a new paper outlining a series of policies that could be introduced under the present devolved settlement as the first step towards building a new economic consensus.
At the core of this must be a public-directed programme of rapid decarbonisation that builds the foundations for a zero carbon future. This means supporting a managed phase out of oil and gas as part of a jobs-led just transition; scaling up Scotland’s renewable energy potential; rapidly decarbonising the housing stock; and moving towards low carbon ways of producing value, such as investing in the caring economy.
It also means breaking with the model of privatisation and outsourcing that has been such a crucial component of the UK’s economic model in recent decades. While the Scottish Government has taken ownership stakes in firms on an ad-hoc basis, as in the case of Ferguson shipyard and Bifab, there is a need to move away from a patchwork of individual interventions and towards a broader strategy to integrate democratic public ownership at the heart of a comprehensive, planned transition to a new economy. In addition to taking sectors such as rail and social care into public ownership, this should also include establishing a new public-led model of development to build a new generation of affordable, zero carbon housing.
There are also synergies that can be exploited from pursuing a more joined-up approach to state intervention. One example is transport. Scotland’s largest bus manufacturer, Alexander Dennis, recently announced that it will be cutting up to 650 jobs due to the economic impact of the coronavirus pandemic. With transport now the highest-emitting sector in Scotland, a key priority is to accelerate the decarbonisation of existing transport networks, and invest in the roll out of low carbon alternatives.
An obvious solution is for the public sector to place a large order of green electric buses, which would provide a lifeline to Alexander Dennis. At the same time, the Scottish National Investment Bank could be called upon to provide the company with debt and equity to ramp up production to meet this new demand. Scaling up the roll out of low carbon buses across Scotland in this way would have the dual benefit of aiding the economic recovery, creating jobs and reducing carbon emissions.
Similarly, the Scottish Government should take proactive steps to prevent struggling but otherwise viable Scottish SMEs from becoming insolvent or falling into the hands of multinational incumbents and predatory capital. Failing to do this could result in greater concentration of Scotland’s business landscape, and further decline of Scotland’s towns and high streets. Here a range of solutions are possible, including establishing a state holding arm of the new Scottish National Investment Bank to take equity stakes in struggling but viable firms; creating Public Commons Partnerships to bring underutilised assets into productive use; and repurposing properties made vacant by COVID-19 into part of the social housing stock.
Devolved budget constraints mean that there are limits on the ability to introduce all of these policies at once. But that’s not an excuse for inaction: Rome wasn’t built in a day, and Scotland’s economy won’t be transformed overnight. But it must start now.
There are also a range of policies that would not require any upfront spending, and could even raise revenue. This includes passing a Community Wealth Building Act to scale up the economic strategy being pioneered in North Ayrshire across the country; introducing an immediate rent freeze and subsequent rent controls to tackle spiralling rents; and overhauling local taxation to replace business rates and council tax with more progressive alternatives.
It should also include taking Scotland’s land reform agenda further, which is key to meeting Scotland’s ambitious climate commitments. Much of the land that would be suitable for nature restoration in Scotland is currently managed as part of private estates for grouse shooting or deer stalking. Measures that can be taken to tackle Scotland’s concentrated pattern of landownership and bring land into sustainable use include introducing an upper limit on the total amount of land in Scotland that can be held by a single private landowner; strengthening the existing Community Right to Buy powers to enable communities to acquire land at below market values; and granting local authorities the legal power to issue Compulsory Sale Orders.
Scotland does not have the full array of powers it needs to fully transform its economy. But it is clear that the suite of devolved powers it already has could be used far more strategically to turbocharge a green recovery. Instead of squabbling over irrelevant statistics, it’s time for the Scottish Parliament to unite behind a bold programme of economic transformation.
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Laurie Macfarlane | Radio Free (2020-08-27T11:46:00+00:00) Scotland must use its devolved powers to turbocharge a green recovery. Retrieved from https://www.radiofree.org/2020/08/27/scotland-must-use-its-devolved-powers-to-turbocharge-a-green-recovery/
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