Welcome to my Blog

I was the Head of Policy and Public Affairs at UNISON Scotland until my retirement in September 2018. I now work on several policy development projects, so all views are very definitely my own. You can also follow me on Twitter. I hope you find this blog interesting and I would welcome your comments.

Friday, 15 January 2021

Helping small businesses to build back better

I have been doing some work with a couple of smaller businesses, mostly legal and HR issues. This isn't a sector I am very familiar with having spent most of my career working in the public sector and with large companies. So, it has been interesting and provided new insights.

One owner joked that he didn't expect to be getting help from a former trade union official. It did remind me of an evidence session in Parliament when I was seated between the Federation of Small Businesses (FSB) and the CBI. The guy from the CBI asked, light-heartedly if I would be more comfortable swapping places. I pointed out that the biggest threat to small business is big business, not unions!

One of the firms had to close, and furlough staff during the first lockdown, but they recovered well as a hobby business demand was brisk. We sorted out some of their staffing issues, but they are now struggling with Brexit. I was, of course, familiar with the queues of lorries at Dover. Still, I hadn't fully appreciated the problems involved in just sending orders to EU companies that didn't exist before Brexit. Assurances from UK Government ministers don't match up for a firm exporting around a quarter of their products to the EU. As the owner put it, orders from the USA have always been a bit of a pain, but it was an occasional pain, not a constant backache!

The other firm has suffered pretty severely during the lockdown. It has had some help from the UK and Scottish Government schemes. I had heard that these were not always easy to access, and there were delays. However, I hadn't appreciated just how difficult it could be. Particularly for small businesses who don't have the in-house administrative expertise. I also discovered that ministerial announcements don't necessarily mean that the scheme is even up and running, let alone paying out.

With this experience, I paid a bit more attention to an article by competition lawyer Michelle Meagher in the RSA Journal's latest edition. She argues that as large global companies accumulate more power, competition laws are no longer fit for purpose. She uses the analogy of a combine harvester, in which big business sucks in the land, capital and people and churns up the world as it goes. This is reinforced by limited liability, short term shareholder value maximisation and executive remuneration. All of this has led to a concentration of markets, channelling power to a few companies in each industry. Instead of protecting the public interest, competition law is aligned to the needs of the combine harvesters. She proposes three solutions around dispersing, democratising and dissolving power. It reminded me of the, admittedly more radical, arguments in Andy Cumber's book The Case for Economic Democracy.

Wearing a different hat, I discussed the FSB's manifesto for the Scottish Parliament elections this week. I can remember when I might have struggled to find much that I agreed with in a small business manifesto. However, there are plenty of decent progressive ideas in this paper, which is well worth reading. Not least the call for a bigger share of public procurement


The discussion has reinforced my view that Community Wealth Building is a critical economic initiative, and that more can be done to support smaller businesses that keep wealth local. My recent experience has also taught me that the vast number of schemes aimed at helping small business, often confuse and complicate access. In my last Reid Foundation paper, the public service hubs idea could also be developed to provide a one-stop-shop for business support.

Scotland's economy is built mainly on small businesses with more than a million jobs dependent on the sector. Like so many other areas, the pandemic has highlighted long-standing problems and created new ones. If we are to build back better, we have to support small businesses to be part of the solutions.

Wednesday, 16 December 2020

Moving pension funds past the greenwash

The investment industry is responding to the demands of pension funds for investment strategies that address climate change. However, we should seek to distinguish between meaningful action and greenwash.

I have completed a couple of projects with pension funds in recent months looking at Environment, Social and Governance (ESG) strategies. These are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. Advisors have been developing ESG ratings, which should make it easier for pension fund managers and trustees who don’t have an in-house capacity to assess investment funds. However, these are very broad and, in my experience, often overly generous.

There are also a growing number of initiatives that seek to align investments with the Paris agreement. This committed most of the world to limit global heating to 1.5C above pre-industrial levels, even if progress has been decidedly mixed. The latest includes Legal and General Investment Management, Fidelity International, Schroders, Wellington Management, Axa Investment Managers and M&G. They have signed up to a pledge that they will aim for all companies in their portfolios to be decarbonised by 2050 or earlier. They have also set interim 2030 targets to decarbonise their portfolios.

Some are rightly sceptical about these initiatives. As the Reclaim Finance campaign group, said: “We seem to have a lot of platforms and not enough trains. Without question, what we do need is a truckload more ambition from investors. Will this group deliver that? It seems unlikely, given that there is no collective commitment to exclude coal or to halt the expansion of oil and gas, both seriously at odds with the stated goal of this coalition.”

Scepticism is also a feature of an excellent report by the Association of Member Nominated Trustees (AMNT), which says that pension funds are often blocked by fund managers, who not only ignore the wishes of their clients but often take contrary positions. The report sets out practical solutions that allow pension schemes to meet their stewardship obligations. 


The report’s author is Professor Iain Clacher, who also wrote a ground-breaking paper on reforming Scottish local government pension funds. His main conclusions are:

· The barriers presented to split voting in pooled funds are not insurmountable, especially as some fund managers have already been doing this for some clients. 

· There needs to be a simplification of the voting chain and investment in technology to enable the effective stewardship of pension fund investments for the long run.

· Asset owners need to be more proactive in their stewardship approach, but they cannot do so without the support of their fund managers and investment consultants. So far, this has been sadly lacking.

· In the short term, asset owners should develop their own voting policies on ESG issues they deem to be financially material, as well as benchmark their fund managers’ voting policies against their own, and hold them to account for it accordingly. If their investment consultants do not support them in this endeavour, they should consider changing advisors. 

· Fund managers should at a minimum report against client voting policies on a comply or explain basis so that asset owners can make more informed decisions.

In my experience, this paper is spot on. Too many reports to trustees are either too complicated or oversimplified greenwash. These recommendations are an important step in the right direction.

Tuesday, 24 November 2020

Procurement failures

The UK Government is mired in a series of procurement scandals that go way beyond poor practice. While not on the nearly on the same scale, all is not well in Scotland either. In recent months I have completed a couple of projects that examine specific procurement programmes. Similar issues cropped up in both projects, which reflect some long-standing lessons that organisations have failed to learn.

 

Barely a day goes by without UK Government procurement stories being reported in the media. Some examples include:

 

·      Sourcing PPE from factories in China where hundreds of North Korean women have been secretly working in conditions of modern slavery. They have no days off and the North Korean state seizes 70% of their wages. It also breaches UN sanctions.

·      PPE contracts involved a £253m deal with Ayanda Capital, a London-based investment firm whose senior adviser was Andrew Mills. At the time, Mills was also an adviser to the Board of Trade. The government paid Ayanda £155m for face masks with ear loops, which could not be used by the NHS.

·      A Spanish businessman was paid more than £21m in taxpayers’ money to act as a middleman in the sale of personal protective equipment to the UK government by a Florida-based jewellery designer.

·      A contract, without a tender, paid £550,000 to the policy consultancy firm Public First for polling and focus groups. No formal contract was put in place until 5 June. The NAO found, “no documentation on the consideration of conflicts of interest, no recorded process for choosing the supplier, and no specific justification for using emergency procurement.”

·      The Ministry of Housing, Communities and Local Government (MHCLG) awarded a £600,000 research grant to a consortium whose members include a fire testing specialist whose research has been funded by Kingspan, the company that made some of the combustible foam used in Grenfell. As well as a fire engineer who has publicly opposed outright bans on combustible materials.

 

A National Audit Office (NAO) investigation into pandemic procurement concluded that normal standards of transparency were waived as departments awarded 8,600 contracts worth £18bn to tackle COVID-19. Deals worth £10.5bn were granted without competitive tender and companies recommended by MPs, peers and advisers were given priority. As the chart below shows, 58% of contracts value was awarded directly to a supplier. Even allowing for the urgency, this is well below the standards taxpayers have a right to expect from public procurement. An issue which is now the subject of a legal challenge from the Good Law Project.



In a recent report for Prospect, I highlighted a number of poor procurement practices in the plan to centralise Highlands and Islands Air Traffic Control. In that report, I listed a range of IT procurement failures in Scotland. One of those failures was Disclosure Scotland, which is continuing to spend millions of pounds to manually deal with disclosure applications more than a year after an IT system £44 million over budget went live. The Scottish Government has also had issues with PPE procurement. The alteration of use-by dates on vital PPE equipment has raised concerns that the Scottish Government is short-changing key workers by providing out-of-date equipment. 


Procurement is important because the spend generates around £10bn of economic activity for Scotland. However, too little of this spending is linked to creating jobs in Scotland, with only 100,000 jobs supported. SME’s have also long complained that they get a disproportionate amount of this spending, and the latest procurement report shows that SME’s get around 1% of total procurement spending. As Richard Leonard MSP recently said, “The SNP Government have handed billions of pounds of public money over to contracts, with little job creation and SME support in return".  

 

I was closely involved in the development of the Procurement Reform (S) Act 2014, which attempted to use procurement as an important lever to deliver broader government objectives, including employment standards and sustainability. Progress has been made in delivering the real Living Wage in contracts, ironically one of the most contested features of the legislation. Outwith this improvement, the latest annual report is full of process and ambition, but limited hard evidence that real progress has been made.


Public procurement properly managed is an essential lever for devolved administrations to deliver their policy priorities. UK Government's pandemic procurement has been a shambles, and in Scotland, the scorecard remains at ‘could do better’. 

Tuesday, 17 November 2020

New thinking on constitutional options for Scotland

With immaculate timing, Boris Johnson blunders into the devolution debate on the eve of the Scottish Conservative conference describing devolution as a "disaster north of the border". Fortunately, we have several more considered contributions to the debate in recent weeks.

 

The Prime Minister’s comments are, even by his own standards, bizarre. Even the UK Government's own website says, "devolution has made a real difference to the lives of people in Scotland - and recognises the wishes of the people to have more say over matters that affect them". As one veteran Scottish Tory told the BBC: "This is dire - it's totally out of touch and reflects a Westminster-centric view of 1992, not 2020”. Another said: "The anger tonight is palpable and the worst I've ever seen towards a Tory PM."

 

For a considered view of the constitutional question, I would recommend a paper the Jimmy Reid Foundation commissioned from Professor James Mitchell to outline and assess the constitutional options for society in Scotland from a left perspective. He argues that Scotland’s constitutional question has become stuck in a rut and the primary focus should be on the impact of proposed changes on citizens’ wellbeing. His broad international analysis points out that states and nations are artificial concepts which change and evolve; just as the UK has with its series of unions.  



The UK’s diversity has still resulted in a highly centralised state, despite Johnson’s, and in fairness some previous prime ministers’ frustrations, at not being able to direct everything from London. James Mitchell goes on to set out the need for rules on any future referendums and the need for a new constitutional convention on how they are triggered. He argues that having more options would empower voters by increasing possibilities, encourage constructive voting allowing people to vote for first preference option rather than a least disliked option; signal views across a wider range of options; and potentially identify an underlying, and otherwise hidden consensus.

 

This is not the same as John Major’s recent suggestion that Westminster could agree to another referendum based on two linked votes, the first to vote on the principle of negotiations, and the second on the outcome of them. Although it does indicate some moderate Tory thinking in the light of the Brexit referendum.

 

As someone who is neither a unionist nor a nationalist, I am naturally attracted to James Mitchell’s argument, ever hopeful (God loves an optimist!) that a consensus could be achieved. While nationalists may be buoyed by recent opinion polls, I would argue that reflects the political case for independence. An actual referendum would also highlight the economic case, which as Laurie Macfarlane has recently argued is much weaker.

 

Another interesting contribution to the debate comes from Ben Thomson in his book ‘Scottish Home Rule’. He defines Home Rule as “a bilateral arrangement between one area within a nation state and the rest of that nation state. This is distinct from federalism, which represents an equal relationship between all constituent parts of a country”. This makes Home Rule a more practical option for the asymmetric UK, although he argues that it could provide a template for the UK to move towards federalism. The difference between Home Rule and devolution is that people in Scotland would know control over domestic matters is decided solely by them, and that this cannot be unilaterally overruled by Westminster and its Prime Minister.



As the secretary of the Keir Hardie Society, I have to regularly explain that Hardie’s support for Home Rule is not the same as independence. He came from the Liberal tradition of Home Rule, largely focused on Ireland during his lifetime. So, I welcome a modern exposition of the concept in Thomson’s book. 

 

Finally, Neil Findlay MSP reminds us in the media last weekend that constitutional powers have to be for a purpose – a society with social justice at its core. He makes a case for Devo-Max, the devolution of powers to the lowest possible level unless there is an overwhelming reason not to. This means that powers do not stop at Holyrood – we need to devolve power to councils, workplaces and communities.

 

Getting past the entrenched positions that many people take in Scotland over these issues is not easy. However, at least there is some constructive thinking on what the alternatives are. 

Wednesday, 11 November 2020

Contrasting approaches to the crisis of care

The COVID-19 pandemic has inspired several new books, which seek to analyse the impact on our healthcare systems and broader society and propose reform. I have read a number of these as background to a paper for a European wide study of the impact of the pandemic on older persons and other work. In this blog, I will share two contrasting examples of these.

 

The Care Manifesto (Verso Books) has been written by a group calling themselves the Care Collective. It analyses the impact of the marketisation of care, which has resulted in those most at risk from COVID-19 receiving too little support. This has allowed multinational corporations to make huge profits out of financialising and overleveraging care homes while work in the care sector was subsumed into the corporate gig economy, mostly at the expense of women as workers and carers. This has been achieved because “ideas of social welfare and community had been pushed aside for individualised notions of resilience, wellness and self-improvement, promoted through a ballooning ‘selfcare’ industry which relegates care to something we are supposed to buy for ourselves on a personal basis.”



They argue for a model of ‘universal care’, which puts care at the heart of our society from our kinship groups and communities to our states and planet. Chapters explain how this would apply to our politics, family, communities, the state and the world. It addresses care in its broadest context, rather than looking specifically at systems or structures. I thought the communities chapter was strong, chiming with a number of the themes I set out in my recent Reid Foundation paper. They propose four core features to the creation of caring communities: mutual support, public space, shared resources and local democracy.

 

While it is hard to disagree with most of the content, even if it is prone to assertion rather than evidence, the language is likely to jar with the general reader. As they say, “The Care Manifesto offers a queer–feminist–anti-racist– eco-socialist political vision of ‘universal care’”. Fine, but this is not likely to find its way into a political programme. Overall, it’s a concise and broad picture of what a different society could look like, but too few practical steps to really call it a manifesto.

 

In contrast, Madeline Bunting’s, Labours of Love: The Crisis of Care (Granta Books), is a more personal argument about the invisibility of care, and its historic under-valuing – based on extensive interviews with people caring for others. The purpose of the book is to make visible the nature of the vast web of care – its importance, extent, subtlety and complexity.  She too hopes the pandemic will see a new politics of care emerging which recognises our interdependence as families, friends, communities, nations and as a human species. 

 

The chapters take the reader through various aspects of care with a final section in each chapter on what we mean by key words, kindness, compassion etc. I enjoyed her story of the manager who, “advised staff to ‘populate the document’ with the ‘likes and dislikes’ of the ‘service user’ as a form of person-centred care: it amounted to getting to know someone with the help of tick boxes”. To be fair, I have seen much worse management speak in the sector.



The hospital chapter includes a story about a snap session with a consultant, which had to be followed by the nurse spending time finding out and sorting the patient’s problem; “Once he (the consultant) has gone, the work of nursing starts. Sam (the nurse) sits down, and places a hand on Derek’s arm to try and calm his anxiety. Finally, he can start to explain”. This is something every nurse can relate to. Time to care is a key issue as the pressure to free up beds is intense and becomes one of the main preoccupations of nurse managers. Hospitals are clocking up record, and potentially dangerous occupancy levels as the number of hospital beds have declined - by a quarter in Scotland since 2009. The chapter on GP services shows similar time constraints.

 

When it comes to time to care, the chapter on home care highlights much that is wrong with social care. Even in what looks like one of the better care organisations in the private sector, “More than half the clients left every year, and the turnover of staff was just as high. The instability necessitated continuous marketing and recruitment, requiring full-time dedicated staff, a substantial cost for this small business”. In another company, home-care visits were fifteen minutes. A new care worker was shocked, ‘I was very green and willing; they trusted me with very vulnerable people after only three hours of basic health-and-safety training. I had no training in moving and lifting, and it’s left me with historic back pain. I wasn’t paid for travel time”. Another care worker highlighted a common response that I used to see in UNISON surveys, “A lot of people literally pleaded with me to stay for a moment, just to have a cup of tea”.

 

This is a beautifully written book that balances traditional evidence with the stories of care workers and communities, all in language we can readily understand. She spoke to individual care workers who are expected to reconcile market principles with their own understanding of people’s needs and their responsibility, and it is those at the bottom of institutional hierarchies who felt the contradiction most keenly. It is also an overwhelmingly gendered role, which in itself says much about our society.

 

Bunting concludes that the marginalisation of relationships may be most graphic and disturbing in low-paid parts of the care economy, but it has infiltrated virtually every dimension of care. Paperwork has become the way to avoid blame and manage risk and marketisation, bureaucracy and technology, is diminishing the primacy of people and the care relationship. 

 

Two contrasting studies reach similar conclusions through different routes. Well worth a read.

Tuesday, 27 October 2020

The case for hydrogen

When it comes to renewable energy, there is a large degree of consensus on the technologies that should feature in our energy strategies. The differences are most apparent around nuclear power, but also carbon capture and storage (CCS) and hydrogen - both of which are important elements in the Scottish Government’s energy strategy.

 

I recently completed an ESG project for a pension fund, which raised specific questions around investments in hydrogen.

 

The history of renewable technology development in Scotland and the UK is riddled with missed opportunities. We have often had a technology lead, before squandering it to others, who then gain the commercial and jobs advantage. CCS, wind power and batteries are just some examples. Many believe that we could make the same mistake with hydrogen.

 

Hydrogen can be produced from a variety of domestic resources, such as natural gas, nuclear power, biomass, and renewable power like solar and wind. The most common methods of producing hydrogen are natural gas reforming (a thermal process), and electrolysis. It is the former, often called ‘Blue’ hydrogen, which is opposed by some environmental groups because it is not totally carbon-free and typically uses CCS technology. The latter, ‘Green’ hydrogen, is made from renewable sources, although it is more expensive to produce.



The EU has a strategy that plans to produce 10 million tons of H2 by 2030, and Germany is adopting a hydrogen strategy that aims to make them a world leader. The UK enjoys a big advantage with this technology given our wind resources, and the intermittent nature of these renewables can be turned into hydrogen, doing away with expensive constraint payments. ScottishPower is building a plant to do this close to their Whitelee wind farm near Glasgow, which could supply hydrogen to Glasgow buses and trains. The first trains are being trialled and manufactured in the UK as part of the Breeze hydrogen plan.



Using CCS, we can turn the emissions from our heavy industries into hydrogen as they transition into cleaner technologies. The
Wood Group is preparing a roadmap for how Scotland’s gas network system will need to be adapted if the country is to make the most of the potential of technologies such as hydrogen fuel and carbon capture and storage. Hubs could include the North-East and Grangemouth, making a real contribution to a Just Transition.

 

We also have several smaller companies operating in this field, which need help to grow. Some of the bigger players, like BP, are also seeking early positions in hydrogen and CCS, although there is some way to go before they can demonstrate that this is more than a publicity stunt. A study for RenewableUK, says the renewables sector is confident that it can repeat the success of the offshore wind industry by driving down the cost of green hydrogen over the next decade. However, this will only be a ‘success’ if this time we retain supply chain jobs in the UK.

 

Experience shows that growth won’t happen without government intervention, which brings together the supply and demand-side players and provides investment. The Westminster All Party Parliamentary Group on Hydrogen has called on the UK Government to urgently set out a UK hydrogen strategy or risk, yet again, falling behind. The Committee for Climate Change has estimated that a developed hydrogen system could eventually contribute a similar amount of energy to the UK economy as the electricity industry does today. National Grid says that cutting the UK’s emissions to net-zero will ‘require’ hydrogen, as it could be used to decarbonise parts of the economy that other options cannot reach.

 

Scottish based Logan Energy has secured UK Government funding to supply hydrogen refuelling stations in Teesside, and hopes to extend these across the UK, with worldwide export potential. They have built the first public hydrogen refuelling station in the central belt and are planning more. Green hydrogen production company Ryse has acquired Northern Ireland-based manufacturer Wrightbus and envisages around 3,000 hydrogen buses with a production facility outside Glasgow. First Aberdeen is to run 15 hydrogen-powered double-deckers supplied by Wrightbus as part of an £8.3 million project been funded by Aberdeen City Council, the Scottish Government, and the EU. We also have the prospect of the first hydrogen-powered ferries in the world operating in Orkney.

 

Hydrogen has the potential to be an important game-changer in delivering net-zero emissions. Powering transport and replacing gas as a source of heating, two areas where we need to make faster progress. We mustn’t let the excellent work being done in Scotland and the UK go to waste as we have done in the past.

Wednesday, 30 September 2020

Air Traffic Control in the Highlands and Islands.

The public procurement of cutting edge technology is risky at the best of times. For a small public sector airport company to embark on such a programme during a pandemic, which is devastating the airline industry, is very risky.

Highlands and Islands Airports Limited (HIAL) are planning to radically change their Air Traffic Management System (ATMS), removing Air Traffic Control operations from several airports in the Highlands and Islands and centralising them in Inverness. Instead of having air traffic controllers on-site, they will be based in Inverness relying on communications technology to manage aeroplane movements.

I was commissioned by the trade union Prospect to undertake a procurement analysis of the proposal, which they have recently published


In this report, I draw attention to the many technology procurement failures in Scotland and the lessons that should be learned. These include sufficient capacity and capability, early stakeholder engagement, over-reliance on suppliers, avoiding optimism bias and cost creep. These are all identifiable concerns in the ATMS programme. 

While there is significant interest worldwide in the use of Remote Towers to deliver air traffic control services, there is limited practical experience using multiple Remote Towers in the way proposed here. A range of concerns have been identified with the operation of Remote Towers including, the breakdown of data transmission systems, cyber-security, weather assessment, impact on human performance and managing the need for ratings for more than one tower in a single shift.

While the proposal will cost more, it will shift employment from fragile island communities, something that was supposed to be addressed by the Islands (S) Act. The programme will take at least £18m of economic benefit from island economies – a proportionate loss to the Glasgow economy would equate to the loss of some 800 jobs. HIAL has only recently appointed consultants to draft an islands assessment, a process which should be undertaken before decisions are made.

All the island local authorities oppose the ATMS programme. As they put it, “HIAL are putting their own priorities and dogma way above the needs of their customers and partners. Taxpayers money is being spent on a needless vanity project. It is utterly unacceptable in this day and age for a publicly funded body to behave in this high handed way’.

The ATMS programme was developed before the COVID-19 pandemic, which has had a massive impact on air travel with a 97% reduction in flights and an estimated £20 billion in lost revenue. Industry analysts all agree that a global recovery in air travel will take many years, if at all given behaviour changes. At the very least, such a significant difference in the operating environment needs to be the subject of a full, transparent, programme review. The Scottish Government should be rethinking their support for the project.