Independent Scotland would usher in ‘cohesive’ approach to public finances

15 Mar 13
An independent Scotland would use public finances creatively to meet long-term policy goals, Finance Secretary John Swinney told CIPFA Scotland’s annual conference in Dundee today.

By Keith Aitken in Dundee | 15 March 2013

An independent Scotland would use public finances creatively to meet long-term policy goals, Finance Secretary John Swinney told CIPFA Scotland’s annual conference in Dundee today.

In his address, Swinney sought to rise above the partisanship of the Scottish referendum debate by stressing the social issues on which there was broad political agreement. He cited the progress made since devolution on problems such as heart disease, alcoholism, smoking and illiteracy. He added that since the Scottish National Party government had come into power in 2007, it had been happy to build on work begun under the previous Labour-Liberal Democrat administrations without changing the general approach.

‘To be honest, there’s a heck of a lot of stuff we agree on, about how to tackle those particular sorts of deeply-set health outcomes, those deeply-set challenges about literacy and other social problems,’ he said.

Swinney also pointed to recent evidence-based and unanimous reports from Holyrood committees on problems such as demographic change and employability. ‘That’s the kind of mature thinking that helps the policy process,’ he said. ‘It just creates a better frame for decision-making and policy-making that is cohesive over a period of time which transcends the three-year budget process.’

He contrasted this with the UK coalition’s benefit reforms, which, he claimed, coerced people into seeking employment but failed to create job opportunities for them to take up. Independence, he said, would empower Scotland to craft more integrated and consensual approaches by giving it command of more policy levers. ‘What it will do is allow us to operate our public finances in a cohesive and rounded fashion,’ he told delegates.

Swinney drew parallels with the collaboration achieved through Community Planning Partnerships, which had opened up new sources of funding for infrastructure projects by promoting stability and continuity, and by shifting decision-making closer to the people it served.

He promised to accelerate public service reforms, focusing on increased partnership and collaboration, more preventative spending, and spreading best practice through performance comparison. ‘It needs to be more comprehensive and it needs to be at a faster pace,’ he said.

Swinney said good progress had been made through change funds in respect of care of the elderly, early years provision and reoffending. But the funds, he said, were worth just £500m over three years, whereas local government and health care together spent £60bn in the same timescale. ‘My challenge is how to make that £60bn work much more effectively and in a different fashion.’

The finance minister urged CIPFA members not to fear the comparative performance data being developed through the Society of Local Authority Chief Executives & Senior Managers, and said he wanted them to be ‘immersed’ in the reform process.

‘We won’t be looking at that information to construct the kind of crude league tables that have characterised discussion of this over a number of years,’ Swinney promised. ‘We shouldn’t be fearful of engaging in that process, or anxious over what it says about us. We shouldn’t be frightened to address that in terms of serving the people we need to serve.’

Swinney also promised that the Scottish Government would take a tough stance against avoidance when it assumes new tax powers under the Scotland Act.  The first taxes to transfer will be land and landfill duties. Swinney said that existing stamp duty reliefs ‘look to me as though they are avoidance, so we’re not going to have those in the arrangements in Scotland.

‘In my opinion, you cannot take too hard a line on tax avoidance.’

Commenting afterwards on the speech, CIPFA Scotland policy manager Don Peebles said: ‘This was a powerful message from Mr Swinney about collaboration and finding cohesive solutions to long-term problems.’


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