Ministers need to stop gambling with the economy and apply more stringent boardroom level scrutiny to policy making, says STRUAN STEVENSON
Thousands of words have been written about the waste of public money in the ongoing ferries fiasco – £250 million and counting – as well as the vexed question of who bears responsibility for signing off the deal. Indeed, a war of words has erupted between the First Minister and former shipyard owner Jim McColl, with the former accusing Nicola Sturgeon of telling “a lie” over the number of jobs saved when the Scottish Government nationalised Ferguson Marine.
One of many problems for the First Minister in this instance is that unlike the government, Mr McColl seems to have kept his own careful paper trail, so he knows what was signed when and by whom. While the Scottish Government has been at pains to blame the fateful decision to purchase the ferries without a full refund guarantee on disgraced former junior transport minister Derek MacKay, an Audit Scotland investigation has criticised ministers for their record keeping on the matter.
We still don’t have a clear sense of why ministers ignored official advice on the matter, but there is an overwhelming sense that political posturing played far too prominent a role in decision-making.
I will come back to those political motivations in a moment but first I want to dwell on Audit Scotland’s inability to discover why the contract was signed off in the teeth of civil servants’ objections, and what this tells us about the SNP government’s attitude to such decisions.
It is not, I think, for want of desire to do its best to create opportunities in the economy that has led to the ferry fiasco. Indeed, I’m prepared to give ministers the benefit of the doubt and believe that they at least convinced themselves (if not their own civil servants) that the political capital achieved from the potentially ruinous taxpayer-funded Gupta smelter funding guarantee or the purchase of Prestwick Airport, would be as good for the economy as they would be for ministers’ reputations.
They were soon proved wrong, however. And that’s because, after 15 years in power, SNP ministers have become so weary and directionless in the exercise of it, so immune to scrutiny of performance and so used to doing what they want when the whim takes them, that they just don’t care for the rigours of due diligence in strategic decision making.
For those at the top of government, proper systems of accountability are mere distractions from the far more gratifying task of applying overly simple political solutions to complicated economic problems.
The ferries contract turned out to be a reckless gamble, announced as a crowd-pleaser for SNP conference to create the impression that the government was doing something positive to boost manufacturing. It turned out that “something” was a blind alley rather than a shortcut to success; no replacement for years of failure to deliver home-grown supply chains in heavy industry.
Likewise, recent staff strikes and the renewed prospect of service cutbacks on the newly nationalised ScotRail network, show once again the limitations of ministers’ capacity to do the hard thinking to make things better. Interventions on trains, like ferries and air travel have so far been for naught in terms of tangible results for the economy.
Underpinning all of this is the corrosive sticking plaster of the government’s perma-campaign to cancel devolution for good via an independence referendum that only a minority see as a sensible priority.
This fuels a lack of grip that undermines any wider sense of economic strategy. For too many years economic planning has been hamstrung by the evidence-free, copy and paste assertion that “the benefits of Plan X would be significantly enhanced with the powers of independence rather than devolution.” Who needs to apply detail and rigour in forward planning if the slate can be wiped clean by one giant gamble on ripping Scotland out of the Union and starting again?
It’s this flippant attitude to gambling with our economy that leads ministers to think it is okay to make bad bet after bad bet on industrial policy for PR purposes with little or no regard for the consequences if things go wrong when it turns out due diligence was lacking in decision making.
The same assertion that all would be better if only the UK didn’t exist, hangs like a fog over the potential success of the government’s new National Strategy for Economic Transformation: a ready-baked excuse for failure to meet targets and a constant distraction from the task of governing sensibly for an economy focused on growth and prosperity, not utopian dreams of separation.
That’s why business needs to be the adult in the room when it comes to engagement with the Scottish Government. It needs to hold ministers to a higher standard of decision-making that is found in board rooms the length and breadth of the country, and demand more from them in terms of outcomes like GDP and productivity growth. The challenges that businesses and workers are facing now, from rising inflation to more expensive borrowing costs, require the Scottish Government to do some hard thinking, in collaboration not conflict with Westminster.
The stakes are simply too high for trite solutions and reckless gambles. The Scottish Government needs to get a grip and business leaders must be on hand to hold them to account if they fail to do so.
Struan Stevenson is chief executive of Scottish Business UK
Scottish Business UK (SBUK) is an independent, non-party voice for business leaders who want to see Scotland thrive economically as part of the United Kingdom.