Iain Macwhirter: Never has the SNP’s complete lack of an industrial policy been so obvious

I’m not sure who was more dismissive last week of the prospects for an independence referendum, Boris Johnson or Jim Sillars. “It’s just not going to happen,” said the PM on his dash north to mark Nicola Sturgeon’s belated acceptance of freeports. “I hope not,” added the former deputy leader of the SNP, who said the party and Nicola Sturgeon aren’t remotely ready for a referendum campaign. Mr Sillars went on to accuse Nicola Sturgeon of economic incompetence.

Nothing very new about all that perhaps. The truth is that no-one outside government seems to think a referendum is remotely possible on the First Minister’s timetable. But in the vacuum left by Nicola’s neverendum, a fierce row has broken out in the independence movement, not about the timing of Indyref2 but about industrial policy. Or rather the lack of it.

The belated decision to adopt the UK Government’s freeport scheme, the ScotWind sell-off, the ferries fiasco, and the failure to deliver the promised “green” jobs bonanza have raised questions about this Government’s grasp of economics realities. It has also lifted the scales from the eyes of those who still believe the SNP is a socialist party. It isn’t and never has been.

That should have been clear from countless SNP policy pronouncements from “It’s Scotland’s Oil” to the “Sustainable Growth Commisson Report” of 2018. The nationalists adopted many policies dumped by New Labour in the 1990s, like prescriptions and free university tuition. Alex Salmond brilliantly reimagined Scottish nationalism as a progressive movement in his Hugo Young lecture in 2011. But he was no Hugo Chavez. The SNP First Minister also talked of Scotland becoming a “Celtic Tiger” like Ireland, by slashing business taxes and attracting inward investment. Ireland has undoubtedly been successful as an “Emerald Singapore”, selling itself to US tech behemoths and others attracted by low taxes. Ireland’s per capita GDP is now nearly twice that of the UK. The mystery is why anyone ever thought this was socialism in action.

Not so taxing

IT took Kate Forbes to bang heads together and accept the UK Government-funded greeports, sorry “green” freeports. Like the Irish, the Finance Secretary understands the logic of offering tax breaks to attract investment. She saw little point in taking a precious attitude towards this policy just because it was Tory.

Her Green Party coalition partners, however, were furious. The Green Development spokesman, Ross Greer MSP, called freeports “a Thatcherite gimmick …throwing money at tax-avoiding multinationals … criminals and money launderers”. At best, the Greens say, freeports just relocate jobs from other areas. Well, er, that’s kind of the point.

Teesside Freeport has been busy attracting industry and thousands of green jobs for the North Sea renewable energy boom. The local mayor, Ben Houchen, boasts openly about how his freeport “attracted investors who were originally looking at Scotland”.

Mr Greer’s moral outrage might have carried more weight had he not just enthusiastically endorsed what is potentially the greatest corporate giveaway since Scotland gave away its oil in the 1970s. He hailed the ScotWind leasing round as a “monumental” achievement. It looks to others like a monumental sell-off.

According to the independence-supporting think-tank Common Weal, the Scottish Government has signed away the rights for energy companies to make up to £5 billion in profits a year in exchange for a one-off gain of £700 million. Never has so much been given away by so few.

Twenty-five gigawatts to be precise, equivalent to five times Scotland’s peak electricity demand. It made the Louisiana Purchase look like a good deal.

Manufacture folly

AS Common Weal’s Robin McAlpine pointed out, promises of Scottish jobs in the offshore industry “supply chain” look distinctly optimistic. There is precious little offshore industry left in Scotland to do the supplying. Turbines, blades and jackets are generally manufactured abroad and dragged here by tug. BiFab, Scotland’s only significant offshore engineering company, fell into administration in 2020 after it failed to secure platform contracts which went to Chinese yards.

Never has the lack of an SNP industrial policy been so painfully obvious. The failure to set up that Scottish National Energy Company, modelled on the Norwegian giant Statoil, that Nicola Sturgeon promised five years ago is only part of the problem.

It looks more like an abdication of economic responsibility, incompetence even. And SNP members are no longer shy of speaking about it.

We’ve known about the wealth off Scotland’s shores for at least 20 years – 25% of Europe’s offshore wind potential. The Saudi Arabia of renewables, as Alex Salmond called it. Yet I can’t think of any significant or memorable speech about the economy from Nicola Sturgeon.

‘Necessary evil’

THE First Minister clearly loathes capitalism and wants nothing to do with it. Nor do her senior civil servants who seem to be selected for their interest in gender, diversity and the constitution. Business is regarded as a necessary evil, the means for meeting various social and environmental ends.

But you can’t have an energy transition in a capitalist economy without capitalism. The banks and the big energy companies, sometimes indistinguishable from each other, are the only organisations with the capital and the industrial expertise to make the net-zero project a reality. They have to be involved.

But that is no reason to hand it to them on a plate. The Scottish Government will, of course, have opportunities in the future to claw back wind revenues. The turbines have yet to be erected. But this looks a poor start to the new energy age.

Unlike oil, wind never runs out. It could be a greater source of wealth even than our hydrocarbons. But the evidence from this first round suggests the Scottish Government would rather just leave it all to BP and Shell.

The Scottish Government needs to be more capitalist, in a practical, materialist sense. Like Norway in the 1960s, it needs to get tough. It is hardly surprising that the tens of thousands of promised green jobs have not materialised. The numbers have actually declined in the last two years. The Scottish Government’s response, typically, was to look for a new definition of “green job”.

Ferries fiasco

IT is a similar story with the unfinished ferries fiasco – already four years late and 100% over budget. Nationalisation can work, for natural monopolies, but only if the people involved know what they are doing. The civil servants and Government ministers have no personal investment in the success or otherwise of Ferguson shipyard. So they pay football club money for managers to come in and sort out the mess for them, which just gets messier.

Last week, we learned that the wires in the Glen Sannox are too short. We can only hope when the Scottish Government takes over ScotRail they don’t discover that the rails are too short.

Ironically, with oil prices nudging $80 and offshore wind promising huge returns, the economics of independence should be looking healthier than ever right now. But not if Scotland’s oil and gas stays “in the ground”, and wind is given away. To the recent confusion over pensions, Nicola Sturgeon has added a narrative of economic incompetence that will be hard to dispel. It surely won’t make for a convincing independence campaign.

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