Beware the SNP’s false promise of social democracy, argues Gordon Brown
Progressives looking to an independent Scotland as the standard-bearer in the global fight against inequality will be sorely disappointed upon a closer inspection of the facts.
One of the propaganda devices of the Scottish National party has been to persuade left-of-centre opinion that breaking free from London rule would create a ‘northern light’ for social justice – a Scotland that is more just, more humane and more socially democratic. However, a Scotland which followed the policies outlined in the SNP’s white paper for independence and ended the system of pooling and sharing resources across the United Kingdom would quickly find that income and wealth would be more unequally distributed than in the country they abandoned.
It may seem paradoxical but the Scottish people’s much-vaunted egalitarian instincts are not reflected in the SNP’s prospectus for a separate state. Myth or reality, Scotland has always prided itself on both its democratic intellect – equalising opportunities in education – and its role as a pioneer of a civic society built on the idea that if the strong help the weak, we all become stronger. And although recent surveys have found Scottish and English opinion similar in their support for the NHS and for help for the unemployed – the difference lying only in a greater Scottish dislike of privatisation and private education – the idea of a socially concerned Scotland is a powerful one that influences how we act.
But the SNP’s plans for an independent state do not reflect that social egalitarianism. Its tax policies will astonish all those used to hearing its claim that, from the day after independence, it would recreate the social democratic state that London has left behind. The SNP has refused to commit an independent Scotland to Labour’s proposal for a 50p top rate of tax. It has also refused to support a new top band of council tax. And while it has announced reforms of stamp duty, it has not as yet included in them a ‘mansion tax’ for the most expensive house sales. It does not even support Ed Balls’ tax on bankers’ bonuses from which Labour proposes to raise £2bn – £200m for Scotland – despite the same concentration of wealth at the top of Scotland’s finance and banking industries as there is in the rest of the UK. With no measures at all to reduce income or wealth inequality, and with no corresponding transfer of income or wealth proposed for poorer Scots, inequality would not fall in the SNP’s independent state.
Nor does its social policy regime match the lofty claims for a new egalitarianism, with the SNP favouring a crude universalism as opposed to a progressive universalism which starts from a floor of basic social rights but gives more to those most in need.
In an ideal world we would want higher universal benefits and better needs-based support. But the SNP’s policy is to emphasise giving virtually the same to everyone regardless of their level of need or the poverty they start from – and almost £1bn of the Scottish parliament’s budget is spent on an extension of universal benefits (including free prescriptions, concessionary travel and free tuition) with less available for the poorest. In the case of tuition fees, the SNP has replaced some of the grants given to the poorest students with extra loans at higher interest rates, meaning that low-income students will graduate with higher debts whereas students from more affluent backgrounds – who receive free tuition and do not need to borrow – are likely to graduate with little debt, if any at all.
What is more, the SNP’s long-term freeze on council tax gives most help to those on upper incomes. But perhaps the biggest signal of where the SNP really stands on progressive taxation is its planned three per cent corporation tax cut with no countervailing measure to replace the funds lost from public services. The gist is clear: the main beneficiaries of the corporation tax cut would be the already-enriched utility companies, for whom independence would offer a triple bonus: a multimillion pound tax cut; an easy escape from Ed Miliband’s planned price freeze; and the end of the obligation on utilities to fund measures to reduce fuel poverty and to increase energy efficiency.
To criticise SNP plans is not to overlook the flaws of coalition policy. No one can defend the ‘bedroom tax’ and the below-inflation rises in social security benefits that are pushing children and already-poor families towards foodbanks, payday loans and loan sharks. As a result the union will not be a caring union for millions of pensioners and families as long as the Conservative-led coalition is in power. Nonetheless, in five years the Conservatives have been unable to smash the basis of the sharing union which has been built up across the UK over 100 years.
Yet the first casualties of independence would be this UK-wide system of pooling and sharing risks and resources to help those most in need and the UK-wide system of national insurance and taxation that funds an NHS for all citizens of the UK irrespective of nationality. People often forget that the citizens of our four nations are guaranteed not just equal civil and political rights but also equal social and economic rights: the same rights to pensions, unemployment benefit and help if they are sick, disabled or poor. No other group of nations has such a sophisticated system of guaranteeing rights to people across national boundaries based on need rather than on nationality. The benefits are clear: whereas 25 per cent of America’s poor are taken out of poverty by their welfare system – and around 25 per cent in Canada and Australia, too – between 55 per cent and 60 per cent of the poor of each nation of the UK are released from poverty.
Between 1997 and 2011 the level of pensioner poverty in Scotland fell from 33 per cent to 11 per cent, a reduction that took 200,000 Scots (and two million British) older people out of poverty. This would not have been possible without a transfer of income across the UK to those in greatest need.
Other multinational associations such as the European Union have found that the citizens of one nation, such as Germany, are not willing to transfer resources on a similar scale to the citizens of another nation, such as Greece. In the United States, common welfare and health provision is so inadequate that the typical citizen of the poorest state, Mississippi, has just 50 per cent of the income of their counterpart in the richest state, Delaware. Yet the average income per head in Scotland and England is roughly the same. That is why, while continuing to advocate improvements, progressives should think twice about breaking a system which, for all its faults and for all its current inadequacies, has redistributed substantial amounts of income and wealth across the UK.
More can be done in the years to come to build on the decision to pool and share our risks and resources – and Ed Miliband has recently made new proposals for reform – but to end the current system of sharing and to start afresh on a dubious SNP prospectus for separation would be a historic and irreversible step backwards for progressives everywhere.
The pooling and sharing which gives progressive purpose to the UK shows where the real issue of the referendum lies. The difference between the two visions of Scotland’s future on offer on 18 September is not about whether Scotland is a nation: Scotland always has been a nation and will remain so whatever the vote. The issue is not whether Scotland has its own institutions: for three centuries since the union Scotland has retained its distinctive church, law and education system. The issue is whether we wish to break all political links with our friends and neighbours in the rest of the UK.
Our vision is of a Scotland proud of its identity with a powerful Scottish parliament that remains part of the progressive system of pooling and sharing risks, rewards and resources across the UK. The nationalist vision is for a Scottish parliament that breaks forever all constitutional links with the rest of the UK. It would make Scotland not more equal but less so.
Gordon Brown MP is a former prime minister. He is author of My Scotland, Our Britain: A Future Worth Sharing
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