When an independent, London-based, Anglo-centric, establishment-endorsed, centrist think tank concludes the UK state is failing, those in Scotland not yet convinced about ending the Union should take heed!

By stewartb – a long read

Views I came across recently, expressed in two quite different places, triggered the writing of what follows. The first was an article by Martin Wolf in the FT (10 June) headlined ‘UK election draws a veil of silence over bitter economic truths – Neither major political party wants the debate that the country needs about taxes, spending and structural reform’.

Wolf writes (with my emphasis): ‘Things must not go on as they have been. The test of the UK’s democracy is whether that reality is recognised and options for improvement discussed. That, one might have thought, is what a general election is for. But political commentators mostly seem to agree that this is hopelessly naive: the electorate does not want to be told the truth and could not understand it if they were. They should be kept in the dark and fed on manure, like the mushrooms they are. This is what the sophisticated political gurus advise. What has been the result? Disenchantment. Any political system, especially a democracy, has to deliver results.’

The second prompt came from following up BBC Radio 4’s Start the Week programme (also on 10 June). One of the guests was Sir Paul Collier, Professor of Economics and Public Policy at the Blavatnik School of Government, Oxford University.  Collier was Director of the Research Development Department of the World Bank and is currently a Professeur invité at Sciences Po and a Director of the International Growth Centre at the London School of Economics. The Radio 4 programme referenced Collier’s new book entitled ‘Left Behind: A New Economics for Neglected Places’.

In the blurb for the book we find this: ’World-renowned development economist Paul Collier has spent his life working in neglected communities. In this book he offers his candid diagnosis of why some regions and countries are failing, and a new vision for how they can catch up. Collier lays the blame for widening inequality on stale economic orthodoxies that prioritize market forces to revive left behind regions, and on the arrogant, hands-off and one-size fits all approach of centralized bureaucracies like the UK Treasury.’

And then adds: ‘As a result, Collier argues, the UK has become the most unequal and unfair society in the western world.’

State of the UK state

Voters in Scotland have long been the target of overt negative political campaigning – of scaremongering. It’s a moot point whether these tactics favoured by Unionists to oppose Scotland’s self-determination should be turned to expose the UK state in order to gain support for independence, equally forcefully and persistently.

What is notable now is that ‘scary stuff’ about the UK is being articulated by a London-based, establishment-endorsed, centrist think tank. What follows is a summary of recent assessments of the state of the UK state from the Institute for Government (IfG), the same UK that still is promoted by Labour, Tories and Lib Dems as the ‘better together’ Union.

The IfG’s findings are given below in verbatim extracts from a number of its recent reports in order to communicate directly its views rather than my interpretation of them.

Source 1: Sargeant et al; (19 Sept 2023) Review of the UK Constitution: Final report – The UK constitution needs urgent reform to fix crisis of trust in UK politics. Institute for Government.

This IfG report highlights ‘acute problems’ with the UK’s constitutional model that ‘urgently’ need to be addressed:

‘Weaknesses in the system of checks and balances have been exposed – the UK system is in theory self-regulating. It relies on those within it being willing to exercise restraint, adhering to largely unwritten rules of behaviour, and, when they fail to do so, facing political consequences. In recent years, various political actors have shown an increased willingness to test constitutional boundaries – seen most brazenly in proposals to break international law and by the executive repeatedly passing legislation on devolved matters without consent from their respective legislatures – with such political checks providing little impediment to them doing so.’

‘The lack of clarity in the UK constitution is problematic – being drawn from a range of sources including law, treaties, guidance and norms and convention, the UK constitution relies on actors to interpret constitutional norms, existing precedent and broad principles.’

‘Increasingly there are also legitimately held but differing views of the constitution, between political parties, parliament and government, the UK government and devolved governments. In the absence of an authoritative and independent voice on constitutional affairs, there is no mechanism for resolving disagreements that arise from these. Under such circumstances, the will of the executive will usually prevail.’ And given the electoral arithmetic in the UK, how much influence does Scotland’s electorate have on ‘the will of the executive’  – when did Scotland last give a majority in a General Election to the Tories? Mid-1950’s as I recall!

The IfG report sets out this ‘case for action’: ‘The UK is facing a crisis in trust in politics and political institutions. Recent political instability has undermined the UK’s reputation as a stable democracy, damaging its international reputation and, as a consequence, its economic prospects. Action is urgently needed to reassert the UK’s fundamental constitutional principles, establish them as a stable basis for the operation of government and reassure the public that they will be enforced.’ Is it any wonder that many in Scotland consider we could do so much better?  Unsurprisingly, the IfG seems blind to any such argument!

……..

Source 2: Davies et al (30 Oct 2023) Performance Tracker 2023: Cross-service analysis – Public services are under considerable strain, with years of tight funding, staffing problems and underinvestment in capital all taking their toll. Institute for Government.

The IfG concludes: ’Compared to other rich nations the UK is a low-investment nation. According to analysis by the Resolution Foundation, UK government investment has averaged around 2.5% of GDP since the year 2000, just two thirds of the OECD average of 3.7%. Indeed, the UK has consistently invested less than the average since at least 1960.’

‘Since at least 1960’! Where did the wealth from Scotland’s oil bonanza go?

……….

Source 3: Anon (7 June 2024) The precarious state of the state: Summary – The true scale and severity of the problems facing the next government. Institute for Government.

Even the use of the term ‘precarious’ by this think tank embedded in the Anglo-British establishment (look at its board membership) is remarkable and telling!

The report notes: ’Most public services are performing worse than before the 2019 election – and far worse than in 2010’

‘Stagnating economic growth and historically high levels of both tax and spending leaves little room for manoeuvre.’  And despite the latter, the UK is in a ‘precarious state’!

‘The UK has invested less than other wealthy nations on capital over several decades. There have, for example, only been two years since 1970 when the UK has spent more than the OECD average of health capital.  But even relative to this low base, the 2010s saw deep cuts to the capital budgets of the departments responsible for critical public services.’

‘Due to historic underinvestment in capital, public services are often short of critical equipment like CT scanners or forced to rely on outdated technology. Maintenance backlogs across schools, hospitals, prisons, criminal courts and the road network have also grown substantially and now total £37bn.  All of this makes it harder for staff to do their jobs, reducing the productivity and performance of public services.’ 

‘Brexit deepened tensions between the governments and these deteriorated further with the UK Internal Market Act – The UK government excluded the devolved administrations from any meaningful say in the (Brexit) negotiations, and the 2020 European Union Withdrawal Agreement Bill passed despite all devolved governments withholding consent.’

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Source 4: Institute for Government (10 March 2024) Power with Purpose. Final report of the Commission on the Centre of Government (https://www.instituteforgovernment.org.uk/sites/default/files/2024-03/Centre-Commission-final-report.pdf )

The following damning critique of UK governance from Westminster and Whitehall derives from a year-long study by the IfG’s Commission on the Centre of Government. Its findings are based on interviews with former prime ministers, leading scientists, senior civil servants in the UK and overseas, and leading figures in local government, the private sector and charities. It merits a lengthy commentary.

In summary, this is what the IfG is concluding in 2024:

‘This is a vital moment for the governance of the UK.’

‘… whichever government is formed after the forthcoming election will face an acute set of policy challenges: stagnant economic growth, intractable regional inequalities, the generational task of building energy security and tackling climate change, optimising AI, chronic problems in public services, an ageing population and decaying infrastructure.’

That’s quite a legacy, attributable to successive, all powerful UK governments. But notably and crucially, the IfG’s commission observes:

‘No.10 Downing Street, the Cabinet Office and the Treasury are not institutions capable of meeting the challenges facing the UK in the 2020s and beyond.’

This is a 199 pages long report so what follows is highly selective, although still a long read. As a by-product of making its case for change in UK governance structures, the IfG sheds light on the nature of institutions that we in Scotland have long had to rely upon, the ones with which we are supposedly ‘better together’!

Problems with the centre:

Here is something of the IfG’s diagnosis:

• ‘in recent decades, cracks have emerged. The UK has become a highly centralised country with a closed, and weak, centre.’  – the reference to the lengthy timeframe  – viz. ‘decades’ – is notable here!  Failings in the governance of the UK nation-state are long standing: they pre-date the recent long period of Tory rule.

• ‘Governments do not do enough to translate their manifesto and other policy ambitions into priorities for government linked to the outcomes they want to achieve.’ – so not only does Scotland’s electorate often get a government a majority has rejected but even the rejected manifesto doesn’t get translated well into deliverable outcomes. – but perhaps that’s been a blessing in disguise at times!

• ‘Cabinet – at one point the UK government’s chief decision making body – has ceased to be effective. It retains an important constitutional and political role, but the big decisions are taken elsewhere’ – yet another sign of the irrelevance of having a Secretary of State for Scotland from any party in Cabinet?

• ‘The UK is an over-centralised country and, while powers have been increasingly if erratically devolved, the centre of government has not kept pace. Decision makers instinctively control and centralise. The centre has not adapted to the consequences of devolution for its own role’ –  in short, the argument being put is that the UK nation-state’s power base in Westminster and Whitehall has been inadequate in its governance of NI, Scotland and Wales. Who knew?

• ‘The centre is not strategic. It does not adequately set top-level priorities, and is consequently unfocused. It is buffeted by events rather than being able to retain a focus on the things that matter. And it struggles to coordinate the big, cross-cutting and long-term priorities that most governments are focused on delivering.’ 

• ‘No.10 is too weak to set direction; the Cabinet Office is too large and has a confused remit. The Treasury fills the vacuum left by the two, which results in whole-government strategy being set according to its own priorities, rather than the collective conclusions of the whole centre. … Combined, these problems are a big part of why UK government is struggling to meet the moment, and will continue to do so until changes are made.’

The time is now!:

Given this critical appraisal – and given the acknowledged scale and importance of the challenges that need to be faced – NOW would seem to be the ideal time for voters in Scotland to exert agency in the design of solutions to governance best suited to Scotland! Basic electoral arithmetic ensures this cannot be achieved whilst within this Union.

And the IfG is also arguing for the significance of NOW! – ‘Moments come when change becomes necessary. …., the logic for change simply becomes overwhelming. 2024 is such a moment.’Of course, the IfG will be blind to the compelling logic at this moment for Scotland’s independence! The only truly radical, beneficial change available to us! It must be crystal clear now to the clever people at the IfG that the fundamental  ‘change’ they argue that the UK state urgently needs is not on offer from the Labour Party – ‘Labour in Name Only’ (LINO),  ‘Change’ as a soundbite only!

A long-standing problem:

We’re told that the IfG wrote over a decade ago of the “conspicuous lack of a single coherent strategy for government as a whole”. Now it is stating: ‘At no point in the 10 years since has this gap been filled. And the gap existed for many more years prior. As long ago as 1970, a white paper published by Ted Heath’s government identified the risk of governments “losing sight of the need to consider the totality of their current policies in relation to their longer-term objectives”.’

The IfG report makes reference to a recent assessment by the Resolution Foundation and the Centre for Economic Performance in their ‘Economy 2030’ Inquiry. This noted that the impact of such flaws of UK governance have been particularly acute on the economy, with ‘Britain lacking a coherent and consistent economic strategy for decades’. And yet despite all this, there is the repeated refrain from Unionist politicians and Union sympathisers that any weaknesses in the performance of Scotland’s economy is the result of shortcomings of devolved government!

This damning assessment gives credence to the view that the opportunity cost to Scotland of being in this Union during the boom times of North Sea oil & gas was huge. It also provides a warning that the opportunity cost to Scotland of a boom in renewable energy based on Scotland’s indigenous resource potential will again be huge if once more we allow ourselves to spectate whilst Westminster decides.

(See also: https://talkingupscotlandtwo.com/2024/03/08/the-real-and-the-opportunity-costs-of-union-how-much-more-will-scotlands-electorate-accept/ )

The all powerful Treasury:

In its description of the roles and practices of HM Treasury, the IfG provides an insight into how budgets for Whitehall departments are allocated. Given these departments include ones with devolved responsibilities, the IfG’s account – perhaps unintentionally – provides an insight into how the scale of the so-called ‘block grant’ based on the Barnett Formula is determined.

The IfG concludes: ‘The Treasury’s control over the allocation of public funds makes it far more powerful than most finance ministries worldwide. But combining this role with the Treasury’s responsibilities as the UK’s economic ministry sees the department’s power manifest in other ways too. As well as – in effect – setting whole-government strategy, the chancellor develops and ‘owns’ the government’s growth strategy, macroeconomic policy and fiscal rules, which frame the context for all budgets and so ultimately, all policy. Chancellors, deploying the power of the Treasury, have a tendency to ‘bounce’ departments into policy – something described by No.10 adviser Bernard Donoughue as long ago as the 1970s and demonstrated repeatedly since.’

It’s worth dwelling on more of the IfG’s description: ‘The Treasury also has sole and closely guarded control of tax policy, which undermines attempts at long-term planning for the tax system and gives the chancellor free rein to pull too many rabbits from too many hats. Responsibility for economic policy – ostensibly shared between the Treasury and various incarnations of the Department for Business and Trade (DBT) – is hoarded by a powerful Treasury when the relationship with DBT becomes dysfunctional, as it frequently does, often reflecting conflicts between their respective political leaders.’

The IfG argues that in addition to being ‘uniquely powerful in Whitehall’, the Treasury is also the most ‘political’ department as it is ‘especially responsive to the priorities of its chancellor.’ And as a consequence: ‘This means the chancellor’s priorities, however they interact with the government’s overall priorities and change over time, dominate the strategic processes overseen by the department.’

Government from Holyrood is simply hugely under-powered in the face of the UK government’s Treasury. Reflect on this: in a nation-state characterised by the IfG as overly centralised, with a weak centre yet dominated by an all powerful Treasury and chancellor, who is in turn highly political and has ‘free rein to pull too many rabbits from too many hats’, how on earth can strategic medium to longer term policies to meet the needs and wants of Scotland be effectively pursued? It is unrealistic to expect a Scottish Government to be able to buck the economic, tax and spend trends of the UK government’s Treasury and its chancellor in anything other than marginal ways.

Departmental resource allocation:

Staying with the implications for the determination of the ‘block grant’, the IfG delves into the processes associated with UK government spending reviews. It notes: ’Spending reviews are largely conducted through bilateral negotiations between the Treasury and individual line departments (though with variable oversight by No.10), incentivising secretaries of state to focus their submissions solely on priorities directly within their control. This frustrates efforts to encourage cross-cutting planning.’  So where does the needs of NI, Scotland and Wales figure in this budget setting process – anywhere?

An opaque centre of government is hard to scrutinise:

The IfG contends that the way the centre of government is set up makes it difficult for the Westminster parliament to scrutinise how decisions are made: ‘The structure of government and absence of whole-government strategy makes it near-impossible for parliament to properly hold government to account for its performance on strategic questions. The structure of select committees is, for the most part, designed to ensure proper scrutiny of the work of each department, but this means they are ill-equipped to study cross-cutting matters (with the exception of a few thematic committees and the recent, but rare, use of ‘guesting’ and joint committee inquiries).’  Are you beginning to sense how far removed Scotland’s interests and Scotland’s influence are from all of this, how diluted the agency of Scotland’s electorate and our Scottish government and parliament actually is?

Of course, we know from history over many decades that it is near-impossible for Scotland’s electorate to properly hold Westminster governments to account at the ballot box given the UK’s electoral arithmetic!

End note

Talking up Scotland does what it says ‘on the tin’. However, it also acknowledges another relevant vector in the provision of context and perspective when attempting to change more hearts and minds in favour of Scotland’s self-determination. This involves exposing the actual state of the nation-state that is the UK.

Such an exposé of the UK’s failings is all the more compelling when the source of evidence and informed opinion comes from those close to the Westminster- and Whitehall-centric establishment!