Friday, 14 September 2012

Scottish Public Expenditure Explained

I am co-authoring a 2nd edition of Scottish Politics with Neil McGarvey (2013).  It includes a revised chapter on "Money and Power: Public Expenditure in Scotland".  It still argues that nothing much has changed regarding the system used to determine the Scottish Government's budget.  Of course, what has changed is that there is less money now than before - but, come on now, let's be careful with this sort of statement.  As the chapter remarks:

"Overall, the real rise in spending in Scotland from 2000-11 has been 53% – a figure that gives some important context to current discussions of economic austerity below (but note that the cash rise, close to 100%, is a very (and increasingly) misleading figure often used by elected politicians to reinforce the importance of the Union dividend).  The first drop in real spending (2010-11) follows a series of very large real rises in annual budgets since devolution". 

Now, if you don't plan to read the whole thing, note that this is a discussion of all identifiable spending in Scotland, not the Scottish Government budget. 

I will copy and paste the introduction below and you can find the rest here - .  If you have any polite comments on my numerical skills, please make them politely.  Thanks to Richard Ashcroft (the academic, not the singer) for helping with the equations necessary to work out future spending using the GDP deflator in table 11.2 (although I don't show my working in the chapter). 

"In this chapter we discuss what may be the most important area of Scottish politics. Public finance is a key aspect of the political process, and the issues raised in this chapter inform most of the themes discussed in this book. Yet, despite the importance of finance to Scottish politics, and long running debates producing calls for reform, the system of raising and distributing money has not changed since devolution. Post-devolution Scotland contin¬ues to receive almost all of its funding for public expenditure from the UK Treasury in the form of a block grant. The arrangements for the transfer of this money are almost identical to those which existed pre-1999 and reflect the continued use of the Barnett formula to alter the block grant at the margins.

[Barnett formula: A mechanism used by the Treasury to determine the adjustment in devolved public expenditure (Scotland, Wales, Northern Ireland) following changes to expenditure in England (in certain policy areas).]

This formula, and its history, is the main focus of the chap¬ter since it is central to an understanding of power relations between Scotland and the UK. These relations are often linked to the idea of Scotland’s ‘financial advantage’ compared to the rest of the UK and the ability of the Scottish Government to spend, but not raise, its money (the issue of finance also informs our discussion of power within Scotland, but the Scottish Government relationship with the Scottish Parliament and local authorities is discussed in chapters 5 and 10).

There are perhaps two main threats to the current settlement. First, the debate on constitutional change has produced renewed calls for some form of fiscal autonomy even if Scotland does not vote for independence. Chapter 12 examines such future proposals in more depth. All we note just now is that, despite this new agenda, the Barnett formula remains. Second, the global economic crisis has contributed to the UK’s new ‘age of austerity’ and a reduction in UK and Scottish public expenditure. Consequently, devolution has been marked by significant rises in Scottish funding settlements approximately for the first eight years, followed by minimal rises and then reductions in the Scottish Government budget. This chapter:

• discusses the issues of fairness, advantage and power in relation to Scottish public finance;

• outlines in detail what the Barnett formula is and why it was adopted;

• considers why the Barnett formula has endured to this day and what this tells us about power and IGR;

• highlights the role of the Treasury, examining Scotland’s unusual inability to determine its budget but discretion on how it is spent;

• highlights trends in Scottish Government spending.

• examines the consequences of the global economic crisis and the UK’s new ‘age of austerity’."

Tuesday, 11 September 2012

Pressure Politics and the 'Scottish Policy Style' Explained

Well, what better way to celebrate Andy Murray's US Open win than to read about group-government relations in Scotland after devolution?  I am co-authoring a second edition of 'Scottish Politics' with Neil McGarvey. It will appear in 2013. It includes a significantly revised chapter on 'pressure politcs', updated to include the post-2007 SNP era.  The main argument is that, while we can identify a 'Scottish Policy Style', we should not assume that Scottish and UK policymaking processes necessarily differ.  Or, if they do, it may be more to do with Scotland's size and the Scottish Government's capacity than a new culture of openness or Scotland's 'consensus democracy' institutions.   It focuses on Scotland, but has some things to say about the often-mistaken assumptions we make about UK policymaking (a point expanded on, for example, here - me if you are struggling for access to the article). 

I have copy and pasted the introduction below and you can find the rest here:

"Chapter 5 suggests that the Scottish Parliament did not foster new and effective forms of deliberative and participatory democracy. It highlights the similarities between the Westminster and Holyrood systems and argues that, in both, most policy is formulated outside the legislative arena following regular consultation between govern¬ments and pressure participants such as interest groups. This chapter examines the extent to which that process of policymaking is distinctive in Scotland following devolution. In other words, is there a ‘Scottish Policy Style’? Policy style refers simply to the ways in which governments make and implement policy (Richardson, 1982). It has two dimensions: the way that governments make policy, in consultation with pressure participants; and, the way that they implement policy in partnership with organizations such as local authorities (discussed at more length in chapter 10).

We can identify some hopes for ‘new politics’ in this area, linked to the idea that Scotland is a ‘consensus’ rather than a ‘majoritarian’ democracy (box 7.2). The SCC proposed, albeit in a rather vague way, a new type of pluralist democracy in which consultation with affected interests would be as wide as possible, not only with established interest groups but also previously excluded groups with a limited voice and ability to organise. This push for broader consultation is associated with a monitoring role performed by Scottish Parliament committees who may oblige the Scottish Government to consult far and wide until they are satisfied that all groups have ‘had their say’. This would perhaps help produce a new and improved consultation process between the Scottish Government, Scottish Parliament and a wide range of representative organizations in the community, voluntary sector, professions and business. This inclusion of hitherto excluded sections of society would come at some expense to the ‘usual suspects’, or the larger and better resourced groups which tend to dominate consultation time with government.

The tone of much of these recommendations is based on the idea that new forms of consultation would take Scotland further away from UK policymaking which is relatively ‘top-down’ and based either on a lack of proper consultation or consultation restricted to a small number of powerful groups that squeeze out the competition. Yet, much of the policymaking literature suggests that this image of the UK is a caricature based on minimal evidence. Scotland may have its own policy style, but this is often related to factors unrelated to ‘new politics’ (such as Scotland’s size and the scale of its responsibilities). The recommendations are also perhaps based on the assumption that there can be a Scottish-specific arena in which pressure participants can engage. Rather, organised groups must consider how best to influence policy in an era of ‘multi-level governance’ in which many levels and types of government are involved, from the European Union to local authorities (chapter 9). Further, the role of local authorities has changed since 2007 (chapter 10), prompting many groups to reassess their lobbying strategies.

This chapter discusses:

• The meaning of ‘pluralist democracy’ and the SCC hopes for a new Scottish Policy Style.

• The nature of pressure politics in Scotland.

• The evidence of a difference between Scottish and UK policy styles.

• The strategies of interest groups in Scotland who are faced with uncertainty in the era of multi-level governance.

• The impact of SNP Government since 2007."

Monday, 10 September 2012

Scottish Intergovernmental Relations (IGR) Explained

I am co-authoring a second edition of 'Scottish Politics' with Neil McGarvey. It will appear in 2013. It includes a reasonably revised chapter on IGR, updated to include the post-2007 SNP era and developments since 2010 (Conservative-led UK Government).  The argument is still very much that IGR is generally informal and that there are perhaps far fewer major public disputes than we might expect (perhaps with the usual exception of the independence debate).  The chapter can be found here - .