Burnhamism and Manchesterism

 As it looks inevitable that Andy Burnham will be the next Prime Minister, we should consider what this might mean in policy terms.

But first, Sir Keir Starmer. He could not continue after the Mandelson saga, electoral wipeout, and the worst personal approval ratings in history. I voted for him in the leadership contest after Jeremy Corbyn resigned. I recognised he might not be a charismatic leader, but after Johnson and Truss, boring looked good. However, I didn’t reckon on him being such a poor politician as his early decisions in government highlighted. He also got sucked into internal factional infighting, which contributed to the loss of members and activists. Labour has to be a broad church.

The usual suspects claim we don’t know what Andy Burnham stands for. He may not have published a manifesto, but he hasn’t been shy at setting out his political philosophy – Burnhamism if you must label it. You might summarise it as devolution, preventative action and tackling social inequality. Matthew Flinders has a good go at articulating this today. And from a Scottish perspective, Marissa MacWhirter makes similar points based on her interview with him last year.

As someone who has argued that Scotland is too centralised, his support for local government is very welcome. As Matthew puts it “Burnhamism represents a complete rejection of the traditionally centralised, elitist, two-party, Whitehall-knows-best Westminster model. It seeks to shift towards a power-sharing model that can accommodate long-term strategic policy-making.” This must be more than devolution to regions and nations. It has to filter down to real communities of place.

The emphasis on preventative action reflects what we said in the Christie Commission many years ago. The government doesn’t need to keep spending more if it invests in tackling the root causes of inequality. There is a broad consensus that this is the right approach, although delivery has been patchy. It will be interesting to see if a true believer in this approach can achieve what governments in Scotland and the UK have failed to deliver.

He is also a supporter of proportional representation, although I regret that it may not be an immediate priority.

If you want a manifesto, then the Burnham supporting Mainstream has published ‘The Productive State: A Framework for Manchester’ – or in short ‘Manchesterism’. Matthew Lawrence and Alex Williams make the case against privatisation, another Burnham theme, arguing that “The retrenchment of public control has created an economy that extracts where it should invest, fragments where it should coordinate, and prices for profit where it should provide for use.” While the UK Government has made some modest changes in the right direction, the authors rightly argue that they have failed to make the necessary structural changes. 

In contrast, the Productive State does this with a toolkit that reasserts national economic sovereignty by directly engaging in public investment, provision, ownership, and coordination of and between essential sectors. This doesn’t ignore the strengths of markets in rewarding innovation and competition, but targets the specific domains where markets have demonstrably failed: where productivity is exhausted and profit is rent extraction; where prices are systemically significant and threaten macroeconomic stability; and where private capital chronically underinvests. Structurally, they argue we should use the public corporation model, operationally independent, commercially mandated, borrowing in its own name, and prioritising resilience over financial return. 

Andy Burnham has done some of this in Manchester with the Bee Network, expanded council housing, and the Good Growth Fund. This helps highlight what public control produces in practice. The challenge will be in scaling this up across the UK. While some of this can be achieved without a massive increase in public spending, more investment will be needed. 

This leads to potential issues with the bond markets. When the interest charged on UK bonds rises, for example, British banks face higher funding costs themselves. This in turn feeds into higher mortgage rates, more expensive business loans and tighter financial conditions. In the UK, total government debt now stands at about £2.9 trillion, with interest rates (yields) currently higher than those paid by the US, Italy, France, Canada, Germany and Japan. Burnham has indicated that he feels we are too much in hock to the bond markets and there are those, like Yanis Varoufakis, who go much further. Others argue for Modern Monetary Theory, but this is certainly a step too far for a new PM. Burnham is likely to bring in some economists with new ideas, such Andy Haldane, with his ideas on war bonds to finance defence investment.

Overall, even an old cynic like me is excited about what an Andy Burnham premiership could bring to our politics. Public sector delivery, preventative spending, tackling social inequality, and above all, localism, are all aligned with my policy perspective. Of course, he will have to face the carping from the usual suspects, the billionaire owned media and the difficult economic position. However, he understands that managerial tinkering around the edges just won't solve the UK's huge structural problems. A decisive change is needed, and we should give him the time and space to go for it.

Defending Democracy

 I was speaking at an EIS conference last Saturday on the challenges facing our democracy. It prompted me to examine the evidence more closely.

Democracy

Let’s start with the state of our democracy. Polling by NCSR highlights the scale of the challenge. They conclude, ‘All in all, it appears that people’s trust in governments and politicians, and confidence in their systems of government is as low now as it has ever been over the last fifty years, if not lower.’

Similar polling by ERS found that a massive three-quarters (76%) of the public feel that politics needs to improve significantly. Lower for Tory voters, higher for Reform voters, and the average for Labour, Lib Dems, and SNP. Politicians command lower levels of public confidence than members of any other profession, even estate agents! This is particularly unfair. I have dealt with hundreds of politicians over the years, and very few meet the ‘in it for themselves’ stereotype. They may get it wrong, but their motives are generally positive. Having said that, I do think the professionalisation of politics is a problem. It shouldn’t be a career in the traditional sense, and politicians should gain broader experience before seeking elected office.

One consequence of declining trust is an increase in support for electoral reform. Sixty per cent now favour changing the UK electoral system to proportional representation, with only 36% opposed. This represents a notable shift over the past few years. Here's a worrying statistic: Reform could secure a majority in Westminster with just 30% of the vote. 

Another shift in my lifetime has been the decline of voting differences by social class. Age is now the biggest dividing line. However, those who believe young people will save us may be indulging in wishful thinking. A University of Glasgow survey found 63% of young people believe democracy is ‘in trouble’ while 27% say they’d rather live in a dictatorship. In Spain, 40% of men aged 18 to 34 report planning to vote for Vox, a far-right party.

There is also little comfort to be had in Scottish exceptionalism. There are slight differences in polling on progressive policies, but it isn’t huge. At least on economic issues, Scotland remains socially conservative.  Even on immigration, 56% of Scottish voters think it is too high. And that’s even though the Scottish economy and public services would suffer significantly without immigration. There is some comfort in the fact that actual voting is more progressive so far.

This isn't just a Scottish or British issue. Oppressive and often violent authoritarian forces have successfully tipped the international order in their favour in many countries, exploiting both the advantages of non-democratic systems and the weaknesses in ailing democracies.

Disinformation

So, what’s behind this shift in attitudes towards liberal democracy? There are economic reasons, including a fall in real wages and a drop in the standard of living. However, you only need to listen to the irritating vox pop interviews on the TV to realise that disinformation is widespread. 

It begins with basic misinformation, such as questions about which services are devolved. I wasn’t brave enough to blame teachers at an EIS conference, and my wife was a modern studies teacher. Like the attainment gap, these issues are societal in nature, and schools cannot address them alone. When even mainstream (supposedly neutral) broadcasters like the BBC uncritically promote Reform, it’s unfair to place the blame solely on schools.

Disinformation is nothing new, but social media has made it easier to spread inaccurate information widely. Research shows that people may be more likely to believe disinformation if it aligns with their existing beliefs, triggers an emotional response, originates from a trusted source, or if they encounter it repeatedly. Believing in conspiracy theories is not a harmless eccentricity. It signals a fundamental failure of judgment. People who embrace such beliefs show they cannot evaluate sources, weigh evidence, or think critically about the world around them.

Disinformation is actually encouraged by the ’reward systems’ on social media. A Yale University study found that the issue was systemic, not just individual. Fact-checking has been largely abandoned by technology companies, citing freedom of speech, even when it involves dangerous disinformation on topics like vaccines. As President Macron says, "We have been incredibly naive in entrusting our democratic space to social networks that are controlled either by large American entrepreneurs or large Chinese companies, whose interests are not at all the survival or proper functioning of our democracies."

Countries are adopting different strategies, including regulation (Digital Service Legislation), countering bots (in California), robust public information schemes (UN Verify), and fact-checking (BBC Verify or The Ferret in Scotland). A free and diverse media is also vital, as is fostering digital literacy in schools. A University of Birmingham study found that 9- to 11-year-olds can be taught to help identify fake news.

Political Parties

Political parties have adopted one of three strategies: ignore, adversarial, or co-option. A European study showed a tendency towards what they called ‘responsiveness’ while remaining aligned with the party’s policy goals. The UK Labour Party has been adopting this approach, despite polls indicating that its voters are shifting to left-wing parties, rather than Reform Ltd. However, for social democratic centre-left parties, academic research is clear: do not move towards the populist radical right on policy.

What is clear is that strong policy arguments alone are insufficient. This can be somewhat discouraging for think tank directors like me! Policy effectiveness is not the same as democratic legitimacy, ‘voice of the people’, or the strategies adopted by the far-right. Politicians like Trump and Farage see blatant lies as a legitimate strategy. 

I have drafted two political party manifestos and contributed to many more. There is an inherent conservatism in their approach, believing that people vote against policies, not for them. The problem is that they sound bland and say nothing that connects with the real-world experiences of voters. Today, I attended the Tax Justice Scotland conference, and the responses from the political panel were generally predictable. The traditional economic analysis by the IFS, OBR, and Fiscal Commission tends to reinforce this groupthink. I disagree with Richard Murphy that all parties are the same, but there are some common themes.

Conclusion

In conclusion, a problem exists, and democracy is in danger. Disinformation is a key issue that must be addressed alongside new strategies to tackle the challenges faced by Western democracies. Political parties have yet to develop an adequate response, and civil society more broadly must step up and be part of the solution.

Political change has to be more than a slogan

The elections in England ought to be a wake-up call to political parties, particularly about the disillusionment many voters feel about our politics. The warning signs were present in the opinion polls and surveys from ERS; others have highlighted the need to rebuild trust in politics. The More In Common think tank reported that their focus groups were brimming with a level of “anger, despondency or misery about the state of Britain that doesn’t feel sustainable”. It is not an accident that in the local elections, 61% of the most deprived wards were previously held by Labour. Now, roughly 85% are held by Reform.

Some take a more relaxed position, arguing that many voters treat politics like buying a new soap powder. Reform is just the latest shiny brand; after all, we have been here before with UKIP. The ‘red wall’ seats are often viewed as a barometer of opinion, but as academic interviews have shown, the dissatisfaction in these areas goes much deeper. People interviewed generally loathed politics, “They don’t [do] what they say, they don’t keep to what they say they’re going to do. They tell lies.” Roughly one-third of the residents interviewed understood politics largely or predominantly through the frame of corruption. From the expenses scandal, Boris Johnson partying during the pandemic, to the current government ministers accepting donations and Taylor Swift concert tickets. This is one of the reasons that action on political donations is so necessary.

I don’t believe the soap powder analysis works because broader attitudes are in play, and Reform is doing much better than UKIP ever managed. I was in Romania two weeks ago, meeting researchers I had worked with for a European think tank. They were understandably focused on their elections and the growing strength of the far-right Alliance for the Union of Romanians, which subsequently took 40% of the vote in the presidential elections. They pointed to surrounding states, with leaders like Orban and Vučić, taking similar populist positions. These leaders are also starting to make territorial claims. You don’t need to be a historian of the Balkans like me to know where this leads. The hope that Germany would be a stabilising influence is gone, while Chancellor Merz attempts to ape the far-right Alternative für Deutschland (AfD) party.

You might argue that Mark Carney’s Canada win and Anthony Albanese's victory in Australia prove that there is an alternative narrative. However, these were wins based on a nationalistic response to Donald Trump, which won’t be available to all centralist politicians. Having said that, a new poll found that voters regard Donald Trump as a bigger threat to the UK than terrorists, so linking Farage’s blind obedience to Trump might be part of a strategy. Nothing beats the Trump administration when it comes to corruption. 62% of all Brits, including 60% of Labour-Leave voters and 53% of Labour-Reform Switchers, back joining forces with the EU over the US.

For UK Labour, the usual post-election honeymoon was very short. Keir Starmer is now the most unpopular PM in recent history after a series of policy decisions that, if not avoided, could have been mitigated. The many good things the new government has done, including employment rights, minimum wage, trade deals and funding for public services, are being drowned out by some poor and politically inept decisions. Many of us suggested thresholds for the Winter Fuel Payment at the time, along with different approaches to WASPI compensation. However, listening is not something this government does well, and No.10 has rejected changes, and internal debate has been closed down. The benefit cuts may not be as electorally unpopular, but the consequences will play out over years.

Aping Reform won’t work, as one of the ‘Red Wall’ voter interviews said, “Sometimes I just think, these people, they say what they think we want to hear. And I find that quite annoying. That, I find, that as if they think we’re thick.” In any case, Labour is probably more at risk from the left, with the Greens and Liberal Democrats doing well in the elections. If Labour seeks to ape Reform, voters will largely opt for the real deal and vote for Reform, while alienating supporters who despair at the party adopting Reform-like positioning. A study by Persuasion UK found that of potential Labour switchers, only 11% said they would consider voting for Reform. By contrast, 29% would consider the Greens, and 41% the Liberal Democrats. If all of the ‘Reform-curious’ abandoned Labour for Reform (many won't because they don’t support Reform polices), Labour would lose 123 seats, but they would keep a parliamentary majority. On the other hand, if the Liberal Democrats and Green Curious switched, Labour would lose 250 and the election.

So, what about Scotland? Some argue that we are different and Scottish voters won’t buy Farage and his snake oil. However, polling and actual votes tell a different story. Some ultra-nationalists are salivating at the thought of Prime Minister Farage, hoping that this will get independence over the line. In fairness, while rightly calculating that Reform will likely do more damage to the Tories and Labour, John Swinney still understands the broader risks to our politics.

Welsh Labour has long adopted a more detached strategy from UK Labour than the Scottish Labour Party and has achieved better results, although that may be waning. Eluned Morgan has said she will pursue a left-wing “red Welsh way” and draw a clear dividing line between Welsh Labour and the national party.

Scottish Labour is struggling to differentiate its message from the unpopularity of the UK government. With independence further down the voters' priorities, focusing on the SNP’s poor record on public service delivery is a fair attack line. Again, I think the Scottish Government has done many good things, but consistently prioritised process over delivery. However, good attack lines are not enough. If anyone in Scottish Labour thinks trading pledge cards on waiting lists and GP appointments is enough, they are seriously deluded. Scottish Labour also needs a positive message to differentiate itself from the SNP. My suggestion is to devolve real power to communities. This combines how to respond to the far-right while contrasting Scottish Labour’s support for localism with SNP centralism. Even UK Labour is likely to have second thoughts about their centralisation of local government in England, with huge Tory/Reform-leaning populations blocking government policy. Suddenly, directly elected mayors have all the downsides that many of us have highlighted for years.

Scotland has some of the largest councils in the world, with an average population of 170,000, against a European average of just 10,000. It’s time to give real powers to actual communities of place. Giving them the resources to fix their high streets, fill the potholes, reopen the libraries and sports centres, and clean up our public spaces. These are the issues that mattered to voters last week.

For Scottish Labour to shift the dial, three things have to happen. First, the UK government has to change its approach to some key voters' concerns. Second, there has to be outright confrontation against the far right, with no more appeasement. Third, Scottish Labour’s positive vision should be about empowering communities. When politics has become detached and alienated from people’s lives, we must return our politics to them. 

And a few more ideas in this new book.

Hope and Despair

 'Hope and Despair' is the appropriate title of Neil Findlay's new book covering the last few years of his time as an MSP. It was politically tumultuous from the aftermath of Brexit and Theresa May in 2017 to Boris Johnson in 2021. As a Scottish Labour MSP, the period began with socialist leaders in Scotland and the UK, fatally undermined internally and externally. But, of course, none of this avoids Neil's trenchant commentary! 

The book takes the form of a diary, which describes and comments on the events of the period he was involved in. I was closely involved with many of the same events, and the book contains incidents I had forgotten about or often wished I had! 

It starts with the successful campaign to get Richard Leonard elected. The book is full of where Neil feels Richard got it wrong and when he got it right. However, in the main, it details the appalling behaviour of some MSPs in this period, ‘the more private a meeting or report, the quicker it is leaked.’ So bad that many MSPs did all they could to avoid Parliamentary Group meetings. As Neil puts it, 'dominated by the most negative people you will ever come across.' Neil also wasn't a big fan of his local council leadership, like so many, dominated by council officers rather than taking political control of issues. Neil was often described as 'Jeremy Corbyn's man in Scotland'. He certainly did admire the Labour Leader but wasn't slow to tell him when he got it wrong. He also covers the many efforts from the Labour right wing to undermine him.

He covers many of the debates in the Scottish Parliament during this period, focusing on the causes he was most associated with. I say debates because Neil was among the few MSPs who could debate. I recall taking a group of UNISON Stewards to Parliament one day. They all commented that most MSPs just read out prepared speeches, and only Neil and Murdo Fraser actually debated. There is little I admire about Westminster, but I agree with Neil that the committee system and some backbenchers demonstrate a degree of independent thought that you rarely see at Holyrood.

Neil was clearly happiest as a backbencher championing the causes he pursued with a tenacity rarely seen in Parliament. The transvaginal mesh scandal, miners' justice, social care, and drug policy come up time and time again. Even though he was a list MSP, local concerns around jobs and services pour out of every page. This was a tough period for his family as well, not least his wife Fiona's health and his mother in a care home during the pandemic. Neil was understandably critical about the way older people were treated throughout COVID.

Neil Findlay is one of those rare elected politicians. He is a working-class guy from a community devasted by deindustrialisation who never planned to be a politician. That sense of community comes through every page of this book, as do his socialist principles. As he puts it, 'It is about what you feel, your outlook on life, your sense of community and the culture you are immersed in.' We could do with more Neil Findlays in Parliament. Sadly, we are likely to see less in the current political culture.

This isn’t a cheery book as the title suggests, although it has a certain black humour in places. However, it was time well spent reading. He ends, as all socialists should, with optimism, ‘live in hope and have a belief that tomorrow will always be better than today.’ 

Understanding opinion polls

 I was doing a session on public affairs at a company staff conference last week, and in the Q&A, I was asked about using opinion polls. The questioner referenced a Twitter exchange I had over a poll commissioned by Scotland in the Union and published in the Daily Record. 

In fairness to those responding, you would get a similar reaction from Unionists to a poll published in The National.

I have commissioned many polls over the years from different polling companies. The decision to publish a poll by a newspaper will be influenced by that newspaper's editorial line. So, it's no surprise that the Daily Record chose to run this story about a poll rather than The National. However, they didn't commission the poll, so they had no influence over its results.

So, what about those commissioning the poll. Well, they do have some control over the questions asked. The Scotsman reported on another question commissioned by the same organisation. The question read: “If there was a referendum tomorrow with the question 'should Scotland remain part of the United Kingdom or leave the United Kingdom?', how would you vote?”. 47% said to remain, 37% said leave. In effect, this is the reverse of the 2014 question giving the unionist camp a positive position. This very clearly illustrates the importance of how the question is worded. Asking the 2014 question generally delivers a 50:50 outcome, as John Curtice's analysis shows.

While both questions are legitimate, they are clearly not comparable, and I doubt John Curtice would include it in his poll of polls. Polling companies, in my experience, will allow some leeway over questions, not least because they will publish the question so people can make their own minds up. What they won't allow is an overly leading question, and what they certainly won't allow is any interference with the polling methods and analysis. 

For campaigning purposes polls can be very useful. They can demonstrate public support for your campaign, something always likely to catch the attention of the politicians you are attempting to persuade. It may be tempting to try on a leading question, but its unlikely to be credible. The best advice is to stick to a positive but reasonably balanced series of questions, which give you a range of options when publishing. 

I'll leave polling analysis to the experts. I was at a Fraser of Allander Institute event for University of Strathclyde Alumni as well last week, second rate though we may be according to Andrew Neil!  John Curtice was giving the lecture and emphasised that a single poll is only a snapshot in time. I'll leave you with his summary slide. 

More lessons from the pandemic - Scottish Care Service

Today, the Jimmy Reid Foundation has published the second in their series of papers on 'Reconstructing Scotland after COVID-19'. As with the first paper, they seek to put forward policies that are especially relevant to the impact of the pandemic and the way existing state and society have responded. This paper has five sections that examine public ownership, social care, education, employment relations law, and union membership.

Professor Andy Cumbers highlights how the pandemic has brought home the abject failures of the UK’s private, market-based economic model. This has been recognised in recent polling, which shows growing support for public ownership during the pandemic. He sets out five important principles for a better run system of publicly-owned and controlled services, building on the ideas in his recent book, 'Reclaiming Public ownership: Making Space for Economic Democracy', which I reviewed in May. 

The EIS general secretary, Larry Flanagan, argues that the impact of Covid 19 has laid bare the fault lines in our society around inequality and poverty, with those children already suffering from disadvantage having that divide deepened. If tackling the attainment gap is really a Scottish Government priority, he asks, "Why aren’t we employing every qualified teacher in the country so that we can cut class sizes to provide more individual support; why aren’t we enlisting an army of support staff to provide additional support; why aren’t we paying retired teachers to act as mentors and tutors to disadvantaged pupils?"

Stephen Deans from Unite makes the case for a new economy built on the promotion of collective bargaining and strong social safety nets so that nobody falls through the cracks and everyone is properly valued. While the Fair Work initiative has helped, this largely voluntary process lacks teeth and relies too much on employer goodwill. He argues that all aspects of employment law, including health and safety, should be devolved. 

Professor Gregor Gall highlights the significant growth in union membership before the pandemic and the growth in some sectors during the crisis. However, he recognises that unemployment in other sectors will act as a levelling point. He highlights the proposals in the IER 'Manifesto for Labour Law', which would assist union recruitment and strengthen collective bargaining.

My own contribution covers the crisis in social care and the growing support for a National or Scottish Care Service. This is not a social care version of the NHS. Instead, it should be a national framework approach that ends the current marketisation of social care. It could set consistent standards, contracts and charges for services not covered by free personal care. Most importantly, it would include a statutory workforce forum to set minimum terms and conditions, organise effective workforce planning and put a new focus on training and professionalism.

While there is a broad consensus on the concept there are still a number of issues that require more work. I outline these in the paper, including the governance model, local democratic accountability, staffing integration, common ownership, and of course funding. The creation of a Scottish Care Service is an idea which has come of age during the pandemic. Turning it from a concept into a practical solution requires more work and some difficult conversations. If we are to ‘Build Back Better', an integrated health and care service, with national standards and local delivery should be the highest priority. 

Build Back Better

In April I wrote about the longer-term lessons to be learned from the pandemic and the importance of thinking about these now, rather than allowing others to capture the narrative - as they did after 2008 with austerity economics. Under the broad 'Build Back Better' banner, there have been encouraging contributions to this debate in Scotland. 

This has not gone unnoticed. As the BBC Business Editor, Douglas Fraser noted recently, “The battle has begun for the post-Covid legacy, deciding what's going to change. The left and progressives are first to engage. Think tanks are on manoeuvres.”

First up there is the Jimmy Reid Foundation’s, ‘Reconstructing Scotland after the coronavirus (COVID-19) crisis: learning the lessons of the pandemic’. This is a series of contributions covering Universal Basic Income, public transport, climate change, education, Freedom of Information and valuing civil servants. I wrote the section on health and social care, in which I set out how the ‘new normal’ must effectively tackle health inequalities with radical action on income support, household debt, social security, housing, public services and the environment. In addition, the need to reform social care is now obvious to all, starting with valuing those who deliver our health and care services. 

The importance of tackling health inequalities is reinforced by Dr Gerry McCartney. Writing for the Poverty Alliance, he said, “As we discuss the policies to protect and improve the nations’ health post-pandemic, equity will be at the heart of it. We have the opportunity to build the economy back better for everyone, to ensure we all have the income we need to live to a decent standard and reduce inequalities for the future.”   

Common Weal is championing ‘Resilience Economics’ – arguing the answer is not more ‘greed and acquisition’, but rather ‘sufficiency and security’. I think there is much to welcome in this approach and said so in a post on their news analysis site. In particular, putting the climate emergency at the core of the recovery. This concept also stresses the importance of wellbeing and foundational economics, which should emphasise decentralisation and stronger communities.

The STUC has published provisional research from Transition Economics which shows how a £13bn stimulus package could deliver a green recovery. Their analysis shows that almost 150,000 good quality jobs could be created at the same time as making a real impact on emissions and strengthening Scotland’s renewables supply chain.

The importance of climate change has been highlighted by business leaders in a letter to the PM calling for a green recovery from the pandemic. Meryam Omi from Legal & General warned: “The government is understandably focusing on the present crisis, but they must heed the dangers of reacting too late to threats and remember one of the gravest in the world - the climate emergency.”

More broadly, a coalition of 80 organisations including charities, unions and churches has written to the First Minister calling for a radical economic recovery programme that prioritises people and planet over profit. They are asking for the Scottish Government to prioritise essential public services and claims national policies should promote more equal wealth distribution, with minimum income guarantees.

There isn’t one magic idea that underpins ‘Build Back Better’, but there are recognised approaches that can guide us. These approaches have to be relevant to lessons learned during the pandemic and be based on progressive values. The response to the last crisis was a disaster for Scotland. There are at least some positive signs that we have the ideas to ensure we don’t make the same mistakes again.

Lessons to be learned from the pandemic

The Covid-19 pandemic has immediate implications for its victims and those in health and care treating them. There are also medium and long-term implications to consider if we are to avoid the mistakes of the past.

The immediate implications are primarily for those working in the health and care sector. Testing has been inadequate, and the provision of Personal Protective Equipment (PPE) has been nothing short of scandalous. Both of these also apply to a much wider group of key workers in the public and private sector who have kept essential services going. This requires a much greater effort in both supply and distribution to protect those who are literally putting their life on the line for the rest of us.

For the economy introducing “suspended animation” policies will reduce the burden on governments because there are fewer bills that it needs to subsidise. This reduction of bills will give governments more breathing room to support the paused economy for a longer period of time. That’s why mortgage holidays, rent delays and similar policies are the right approach and stand the best chance of avoiding a standard recession spiral.

The crisis has also highlighted structural issues that we need to address. The Archbishop of Canterbury put it well in his Easter address: “The next wave coming is the economic one … We have a choice there as a nation and as a society and as a world. Do we take hold of our destiny and make sure the differences are mitigated, abolished where possible – or do we just let things happen, do we let the market rule, in which case there will be enormous suffering.”

Even some of the harder headed media recognise that change has to happen. A Financial Times editorial said; “Governments will have to accept a more active role in the economy; see public services as investments rather than liabilities; make labour markets less insecure. Redistribution will again be on the agenda.”

Here are some of the longer-term lessons being discussed:

·      Economy: As the Fraser of Allander survey and the OBR signals, the economic numbers are bad now, and likely to get much worse in future. It is absolutely right that governments do whatever it takes to support people and the economy through this pandemic and the job retention scheme was vital, even if other measures have many gaps in them. 

We also have to recognise that economy was in a poor shape before the pandemic hit. The reason the UK government has been pumping so much money into the health service, into wage subsidies, into support for the self-employed and for small businesses is that they were all only just managing before the crisis broke. The fundamentals of the economy are not as strong as some claim. Ultra-low interest rates have left no buffer and global supply chains exploiting marginal efficiencies have been found wanting.   

When it is over, there will be calls to tackle debt, and some will want to repeat the mistakes of the 2008 crash by instituting another round of austerity. In practice, most of the state debt we owe to each other, and we can meet obligations denominated in pound sterling. 

The conventional wisdom is that ‘monetising the debt’ is inflationary. However, there are no indications that inflation is a problem today. Lerner, an associate of Keynes, decried arbitrary government deficit and debt ratios as an inappropriate focus of economic policy. He also demonstrated that deficits do not need to be fully funded through bond sales. The UK’s experience after the second world war suggests that such high public deficit and debt levels do not in themselves prevent strong recovery or put an intolerable burden on the state. There is no rational case to inflict further damage to the economy through Austerity Mark 2.

A significant number of companies will do the right thing, and they should be supported. Consumers will remember those who have behaved badly. Nationally it has been the predictable names – Ashley, Green, Branson etc. But also, locally. Just look at community Facebook groups to see which local businesses have shown an amazing community spirit and those who haven’t.  

To ensure the economic effect of the pandemic is minimised, we must ensure there is money in the pockets of those on the lowest incomes. This will provide the greatest boost to demand. And public spending must not be targeted in any drive to reduce borrowing.

·      Private debt: Economic recovery could be undermined by household and business debt, which is vastly higher than after the second world war. Many people in Scotland and the UK are constantly a couple of weeks from going bust and have no savings cushion.  Economic growth before the banking crash was over-reliant on increasing household debt. Both have eased somewhat since the 2007-09 crisis (see chart below), but household debt, in particular, is rising again – driven this time by credit card and student debt rather than mortgages.

The UK Government recovery programme party addresses corporate debt by providing businesses with loans and generous payback conditions and other support. To achieve a sustained recovery, the government might need to have household debt partially cancelled, or at least frozen.

·      Tax avoidance: The sight of Richard Branson calling for state bailouts from his tax haven should be a defining image of this pandemic. Sadly, it is probably not as simple as saying no to the tax dodgers because jobs and supply chains who do pay taxes could also be victims. However, that doesn’t mean that taxpayer support comes without strings. It should be used to take an equity stake in these businesses and change the business greed culture. Global action would be good, but we must not wait for that to happen.

·      Employment: As the STUC and TUC have said as we clap key workers each week; ‘Public sector workers are for life, not just for a crisis’. The gratitude is also striking because it highlights just how much we under-value these same people in normal times. We now see that we can do without celebrities, but not shelf-stackers. Many of the people we rely on most – social care workers, cleaners, retail staff - are among the lowest paid and least secure workers in the country. They deserve better, and we need a different approach to wage inequality and employment security in future. The crisis has also shown that new ways of working are possible.

·      Preparedness: There can be little doubt that governments were poorly prepared for this crisis, despite past emergency planning exercises that highlighted many of the issues we face today. Clearly, we had an insufficient stock of the right types of PPE, but it has also been a failing of logistics. The NHS has centralised the buying and distribution of its core supplies on the grounds of efficiency. That may work well in normal times, but as soon as the pandemic hit that supply chain was overwhelmed. For those outside the NHS, particularly in the fragmented social care system, there was no system to support them.

The inability to follow the WHO’s instruction to “test, test, test”, points to the UK response as one of the severest failures of public administration in our history. This also points to the importance of supporting public research rather than relying solely on drug companies who will always prioritise research that delivers short-term profits. With Trump closing down public research facilities in the USA, Britain and Europe needs to step up to the plate. 

‘Unprecedented’ may be the word of the year but governments have struggled to communicate effectively. The public accepts that scientists and medics do not yet understand all aspects of this virus. But that is not an excuse for the lack of honesty and clarity around issues that politicians are responsible for. This includes basic information and some pretty appalling commentary – Priti Patel and Matt Hancock in particular. We are self-evidently not ‘all in this together’ as it is the poor and BAME citizens who are hit hardest. 

·      Health and social care: With the understandable focus on the NHS, it took some time before our already stressed social care ‘system’ came under the spotlight. It took a pandemic just to get a Scotland wide agreement to pay all social care staff straight away. As the CEO of Enable put it: “it requires commissioners to enter complex negotiations with multiple providers (with a total of around 1,000 different third sector and private sector social care providers operating in Scotland this must have been tough); and – most importantly of all – it has meant the frontline staff delivering care in our communities have had to wait many months for a backdated uplift to (hopefully) be secured and paid – all subject to the outcome of those negotiations.”

The case for a Scottish Care Service that sets a national framework while leaving delivery local is now overwhelming. Perhaps it is also time to think about some radical ways of funding social care, including Andy Burnham’s plan to tap the wealth of the older generation, so everyone contributes 15% of their assets on retirement, usually through equity release on their property.

·      Social security: Many more people from all walks of life have discovered what the poor have known for years – our social security safety net doesn’t work. Universal Credit, with its five-week waiting time for a payment isn’t fit for purpose. 

A poll for the Food Foundation showed that more than 1.5 million adults in Britain say they cannot obtain enough food. Half of the parents on low incomes with children eligible for free school meals said they had not yet received any substitute meals to keep their children fed. Around 830,000 children are therefore likely to be going without daily sustenance.

The need to protect incomes has led to a call to adopt Universal Basic Income. Personally, I have been a sceptic on structural and cost grounds, although I agree that it is worth trialling in a serious way. 

What is not in doubt is the need to build a stronger safety net. Total out-of-work payments received by UK employees are on average around 34% of their previous in-work income – the third lowest among 35 OECD advanced economies. At 15% of average earnings, the main adult unemployment payment is worth less than at any time since the creation of the welfare state in 1948.

NEF has proposed a Minimum Income Guarantee to sit alongside the other support schemes. This would be a comprehensive, sufficient, non-conditional, non-means tested at the point of access, minimum income floor to catch everyone who is currently missed out by the job retention scheme and the self-employed income support scheme.

·      Housing market: Governments moved quickly to remind mortgage holders of existing provisions for mortgage holidays. They were much slower to intervene in the weakly regulated private rented sector, which so many now rely on. The pandemic may well have long term impacts on the housing market, including house prices and construction. 

Instead of simply patching together a housing market that was already failing, we could take the opportunity to rethink our whole approach to housing. This could include restoring the historical link between house prices/rents and local incomes; a massive programme of social house building and renovation; effective regulation of the private rented sector; and building houses for people rather than investment.

·      Food: The weakness of global supply chains and the need to take climate change action will inevitably strengthen the case for local food sourcing. This is a two-edged sword as it may well have an impact on some Scottish exports, including whisky and salmon.

·      Industrial strategy: The crisis has highlighted the absence of an effective industrial strategy. The shift to a service-based economy and the reliance on ‘just in time’ global supply chains has to end. For example, China is the only immediate high-volume source of clinical gowns, and there are similar problems with other PPE. 

Relying on a cottage industry of 3D printers is no way to run a country. We need a new industrial strategy that supports Scottish and UK ownership, and that includes using the pandemic support measures to take strategic stakes in companies. Only ten out of the top fifty Scotland’s firms are owned by shareholders in Scotland, and of these only four are in manufacturing.  We have to break the short-termism of investment companies who prioritise dividend payments at the expense of investment.

·      Community: The pandemic has highlighted the importance of strong communities, supporting and looking out for each other. In the main, people and communities across Scotland stepped up to the plate. Even the Tory Prime Minister made a point of saying that there is such a thing as society, in a deliberate attempt to distance himself from the Thatcher doctrine.

This crisis will also have a long-term impact on the economy of local communities, and we must, therefore, put a renewed focus on initiatives like Community Wealth Building. It will be the foundational economy that takes us forward – not global supply chains. 

·      Global solidarity: A new sense of community is not an excuse for isolation and protectionism. We are not alone in this crisis.  People right across the globe feel the same uncertainty, fear, despair and isolation. Pandemics do not respect national boundaries and abandoning the global south is not only morally wrong, but it is also in all our interest. As the Pope put it: “Indifference, self-centredness, division and forgetfulness are not words we want to hear at this time. We want to ban these words for ever!”

·      Climate crisis: Global emissions have crashed during the crisis giving us a glimpse of what the world might look like without fossil fuels. But hopes that we will emerge into a healthier, cleaner world will depend on the long-term political decisions made about what follows. We must ensure that the postponement of the COP26 talks is used effectively. As Nicholas Stern has said; “There is an opportunity in the recovery from the Covid-19 crisis to create a new approach to [economic] growth that is a sustainable and resilient economy in closer harmony with the natural world.” 

We should not assume that these lessons will be learned. After all, not much changed after previous events, including the 2008 banking crash. As Kevin McKenna put it: “Each of these seemed to provide opportunities to step back and evaluate the choices and behaviours which led to them. But after a respectable period of moral introspection the bacchanal resumed.” 

Hedge funds have already proudly announced the billions they have made from disaster capitalism. The Tories, despite appearances, have not turned into Corbynites. These are temporary measures to preserve capitalism.

The problem will lists like the above is that they can become a shopping list of all the ‘good’ things progressives would like to see. This pandemic has exposed many social ills, and it is those that we should address first.  Yes, they must be radical, but they must also be relevant to recent learned experience if they are to attract wide public support.

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Overall, we must ensure that the lessons are learned. These include the importance of community, the impact of globalisation and the vital role of the state, local and national when nothing else stands between the people and penury or even death.