Scottish cabinet members: experience required

Commentators were underwhelmed by the announcement of the new Scottish Cabinet, there were few new faces and few changes of portfolio. Even Angela Constance, who has borne the brunt of criticism over the failures in education, keeps a place at the top table.

But a look at the tasks ahead throws some light on the reason First Minister Nicola Sturgeon went for experience over novelty. There are big problems facing the new Scottish Government and some of them will come to a head very quickly.

The most pressing is to sort out the fiasco over farm payments. A new IT system to deliver EU grants to farmers is seriously behind schedule, over budget and unlikely to meet expectations. The Government has been severely criticised by Audit Scotland for “a number of problems with the programme’s management, including significant tensions between teams, confused governance and accountability arrangements, and a failure to deal effectively with a significant conflict of interest held by a contractor on the programme.”

More seriously, if the system cannot meet EU standards by the deadline next month, it is possible the European Commission will impose penalties of between £40-£125 million.

Had former Rural Affairs Secretary Richard Lochhead not stepped down citing his wife’s illness, it is likely he would have lost his job anyway. Farmers hold him responsible and there is a suggestion that their anger cost the SNP its majority. Former Energy Minister Fergus Ewing now has the unenviable task of rescuing the situation, but it was Deputy First Minister John Swinney, the archetypal ‘safe pair of hands,’ who had to answer the auditor’s criticisms on Radio Scotland.

Mr Swinney has been moved from his former economy/finance role to try to deliver on the First Minister’s pledge to make education the centrepoint of her administration. It is also a huge task.

Although far from damning, a recent OECD assessment of the state of Scottish school education raised serious questions. In some cases achievements in reading and mathematics have been declining rather than improving and the attainment gap between children from rich and poor homes remains persistently wide.

The OECD is generally supportive of the Curriculum for Excellence, which the SNP inherited from the previous Labour-LibDem administration, but highlights problems with its implementation and (splitting no infinitives) calls for the government “boldly to enter a new phase.” That new phase involves a dozen recommendations.

Some suggest that the problems of Scottish school education have been caused not by too little government attention, but by too much. Teachers having to deal with a constant flow of new initiatives have been distracted from the job in the classroom. The balancing act Mr Swinney has to perform is to allow them enough freedom to get on with the job, while ensuring that they do so.

The OECD report pointed up the need for more accurate and timely assessment information and this is the purpose of the standardised testing regime announced by the Scottish Government. But EIS, the teachers’ union, is already balloting its members on industrial action over “excessive assessment demands.” Any new initiative will have to be introduced in a way which convinces teachers that it is a tool they can use, not another rod for their backs.

The split economy

John Swinney’s old job has been divided in two. Keith Brown takes on the Economy, Jobs and Fair Work at a time when the Scottish economy is under-performing that of the UK as a whole, unemployment is rising (against the UK trend) and the outlook is clouded by a pessimistic assessment of the prospects for the oil industry.

The SNP manifesto promised to boost productivity to the levels of the most successful economies in Europe, but was short on the detail of how this might be done. This aim has eluded successive governments of all parties. With capital spending under pressure it will be hard for Mr Brown to show any improvement at all during the term of the new government.

The finance role falls to Derek Mackay, but he inherits a much harder job than his predecessor ever had. John Swinney was responsible for spending money, but hardly at all for raising any. His budgets mostly allocated the cash passed on from Westminster. Mr Mackay will have to decide not only where the money is to go, but also where a large proportion of it will come from.

At a time of economic concern, forecasts of how much will be raised by income tax in Scotland will be very difficult to make with any accuracy – and the record so far of predicting the yield on the few minor taxes the Scottish Government does control does not inspire confidence.

On top of this, he can expect political uncertainties. He may secretly welcome the fact that because it has to rely on the Greens for support in the Scottish Parliament it is possible that the SNP will have to abandon its pledge to cut Air Passenger Duty. But has he yet realised that the manifesto proposal to raise the threshold on higher rate tax by only the rate of inflation will hit the largest taxpayers at a time when they will also suffer from a hike in National Insurance Payments?

The SNP declined to raise the top rate of tax on the grounds that it would encourage high earners to move themselves or their money out of Scotland. Inadvertently they may yet win the honour of making Scotland the most highly taxed part of the UK.

This blog first appeared at the David Hume Institute site and is reproduced with permission

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