AS I SEE IT: Business has every reason to worry about the new SNP-Green deal, writes TERRY MURDEN
The confidence and supply agreement between the SNP and the Green Party prompted a response from business that in some media has been described as a “cautious welcome”. That’s not how it looks from here, with statements from a number of organisations indicating that there are serious grounds for concern.
CBI Scotland’s Tracy Black stated that the SNP and Scottish Greens should “not seek to shut business out of the discussion on economic recovery”, an unequivocal warning that the new quasi-coalition could fall far short of promoting what is best for business and could make it more difficult to engage with ministers in growing the economy.
Liz Cameron at the Scottish Chambers of Commerce, declared: “Businesses have been clear that what they are looking for from the Scottish Government, whatever its composition, is a commitment to implement stronger pro-business policies”, an affirmation that current policies are not strong enough.
In a reminder of the precarious position many firms still find themselves in, Andrew McRae at the Federation of Small Businesses Scotland, said: “We would therefore ask for a focus on building on the fragile optimism in the Scottish small business community, avoiding heaping new pressures on these operators.”
There was concern too from specific sectors of the economy, none more damning than comments from Sarah-Jane Laing, CEO of Scottish Land & Estates, who said: “There will be significant unease if the new coalition takes an ideological approach rather than one that seeks to bring people together.”
Cautious welcome? I don’t think so. This collection of blunt statements sounds more like a stark warning, tinged with serious alarm.
Renewal of the road system? Unlikely. Support for anything not linked to the green agenda? Scottish Enterprise is already distancing itself from non-green submissions applying for support.
Top of the list of targets is oil and gas, subject of a previous column, and the likelihood that the Greens will use their two new ministerial appointments to bully the SNP into prematurely winding down the sector.
Of course we need to wean ourselves off fossil fuels, but anyone who thinks this is a short term goal is not only kidding themselves, they are exposing the UK to greater imports of oil that would be required to keep the economy functioning.
Some comfort is offered in the agreement for a ten-year £500 million Just Transition Fund for the North East and Moray. This a positive start that signals at least a willingness to support the switch to cleaner fuels.
But it needs to recognise that the shift is not happening fast enough and that, as the GMB union says, the promise of 28,000 offshore wind manufacturing jobs and “a Saudi Arabia of renewables” in Scotland has never materialised.
Oil is fundamental to manufacturing just about all that we consume. Business should be demanding that instead of declaring war on the black stuff, the new ministerial team forms an alliance with the oil and gas sector to ensure the move to cleaner energy is properly managed. That means acknowledging its continued production and the vital contribution that the major companies will make to ensuring the transition is successful.
First Minister Nicola Sturgeon needed the Greens in order to get her legislative programme through parliament. That’s not to say the new partners will agree on all things – and there are exclusions in areas such as aviation – but the agreement will do more than show delegates attending the COP26 Summit that the Scottish Government is serious about climate change. It also signals a step towards Ms Sturgeon’s real ambition.
Announcing the agreement with her new Green friends at Bute House, she said: “It recognises that business as usual is not good enough – we need boldness, courage and a will to do things differently.”
However, she was referring to the constitution, rather than the climate or the economy. It was widely noted that a commitment to another independence referendum was top of the new partners’ “to do” list, described by Robert Kilgour, chairman of Scottish Business UK, as “depressing if predictable”.
While it may have prompted a collective sigh across the business community, at least it may encourage the SNP-Green partners to put more flesh on the bones of what is currently a thin case for independence.
The Growth Commission report has been kicked into touch, the deficit in public finances stands at an eye-watering 22.4% of GDP and without oil and gas revenue in the long term – and no clear idea how to replace it – there is little prospect of operating an independent state without sharply higher taxes and lower public spending. A Green imposed restriction on growth will only make matters worse.
Terry Murden held senior positions at The Sunday Times, The Scotsman, Scotland on Sunday and The Northern Echo and is now editor of Daily Business