By stewartb

The Scottish Fiscal Commission published April 8 a report entitled ‘Fiscal Sustainability Report – April 2025’. An article in the Scotland section of the BBC News website covered this under the headline: ‘Significant challenges’ for health funding, warns report.’ (See: https://www.bbc.co.uk/news/articles/ckgxyegeelyo )

As will become apparent, two things about the BBC article are significant:

• there is no mention of the UK or Westminster government anywhere in the BBC’s article;
• the BBC makes substantial reference to the views of the ‘head of devolved and local government finance’ at the Institute of Fiscal Studies (IFS). As best as I can judge, the IFS input is lifted from an article on the think-tank’s website – ’Scottish Fiscal Sustainability Report – immediate response’ – rather than from an interview.

(See https://ifs.org.uk/articles/scottish-fiscal-sustainability-report-immediate-response)

By avoiding any mention of the UK or of Westminster, the BBC misses important context- and perspective-giving references prominent in the IFS’ commentary. The IFS response states right up front: ‘Today’s Scottish Fiscal Commission (SFC) report highlights the fiscal challenges facing the Scottish and UK governments over coming decades as populations age and public service costs rise’.  (My emphasis)

The BBC piece also omits to mention this from the IFS’ commentary: ‘‘Under current constitutional arrangements, Westminster’s tax and spending choices will remain a key driver of the Scottish Government’s budget.’

The BBC article does have this: ‘David Phillips, head of devolved and local government finance at the Institute for Fiscal Studies think tank, said households are likely to face a choice between higher taxes or a state investing less in public services.’

Inspection of the IFS article reveals this is what Mr Phillips actually wrote: ’The SFC’s analysis therefore makes clear that households either side of the Scottish border will likely face substantially higher taxes or a state that does relatively less in the decades ahead.’ The BBC editing is obvious and significant.

The BBC omitted something else the IFS expert wrote viz. ’Encouragingly for Scotland, health spending – an area of spending likely to see particularly big pressures in coming decades – constitutes a smaller fraction of overall spending than in England and Wales. This means the so-called ‘Barnett squeeze’, whereby funding per person in Scotland grows less quickly than in England, will bite less hard than it otherwise would, with more scope to reallocate funding from other services to healthcare.’

Might the phrase ‘encouragingly for Scotland’ have been the crucial factor in the BBC’s decision to leave this bit out? (By the way, there is no attribution to a named BBC journalist.)

Comment on the IFS response

Recall the following IFS insight: ‘Under current constitutional arrangements, Westminster’s tax and spending choices will remain a key driver of the Scottish Government’s budget.‘ 

Might one venture to suggest a modification to the above sentence from the ‘authoritative’ IFS, in order to make the matter in hand clearer? How about this: ‘Under current constitutional arrangements, Westminster’s tax and spending choices, and its monetary policy choices, and itsenergy policy choices, and its trade policy choices, and its policy towards the European Union, and its migration policy choices, and its labour market policy choices, and itsindustrial policy choices, and its social security/welfare policy choices (have I missed any?) will remain key drivers not only of the Scottish Government’s budget but also of Scotland’s economic, social and environmental future!

And more from the IFS: ‘An independent Scotland would face trade-offs at least as difficult, unless it could significantly boost economic growth. And growing international tensions – on trade and defence – will only add to the fiscal pressures facing Scotland, the UK and countries across the world.’

At least as difficult as the UK and other countries? I’ve never considered that an independent Scotland would be unique in the world in being immune to difficult trade-offs – have you? And what is the evidence from recent history that Scotland’s economic growth is significantly boosted from being within the Union?

The blind spots in the IFS author’s assessment are rather obvious. Economic growth in the UK has been weak for some time, dating back before recent ‘international tensions on trade and defence’. Moreover, all countries – all those with the status of nation states – are always facing trade-offs, and from time to time ones that cause considerable difficulty: that’s not exceptional, that’s life!  But all countries – according to the IFS, ’the UK and countries across the world’ all facing fiscal pressures – that have the status of a normal nation state have governments with very much more agency than devolved governments in the UK. The agency of a normal nation state together with its plentiful, indigenous (and ‘sticky’) economic assets offer Scotland opportunity, hope and greater potential for progress!

End note

We may consider the number of voters in Scotland reading an article on the BBC News website is quite limited but it is likely to be a great deal higher than those reading something on the IFS website! (I have no idea how this topic was covered in other BBC Scotland news outlets, if at all.) However, the BBC more generally seems to. rate the views of the IFS as the ‘gold standard’ in economic commentary on the UK. This only makes the highly selective, skewed reporting of the IFS viewpoint potentially influential.

Is this selective reporting by the BBC designed to make voters in Scotland fearful again about independence? Is the BBC deliberately avoiding the IFS’ explicit acknowledgement of Scotland’s dependency – on ‘Westminster’s tax and spending choices’ – within the Union?  And is it working to avoid the IFS’ contention that citizens across the UK are likely to ‘face substantially higher taxes or a state that does relatively less in the decades ahead’?

The way the BBC opted to leave out key parts of the IFS response that relate to UK matters facilitated Tory and Labour MSPs making statements condemning the Scottish Government within the BBC article. A more honest account of what the IFS had actually stated would have diminished the opposition MSPs’ opportunity and resulted in a more fully informed BBC readership.