Sunday 7 September 2014

#IndyRef

Posted by Unknown at 9/07/2014 Labels: Independence, Politics, Referendums, Scotland

Well the debate is nearing its end here in Scotland over the upcoming referendum on independence. It is not just politco's that are engaged with the debate, almost everybody is talking about it. At the dinner table, in the shops, down the pub. We Scots are fired up, and a lot of us are divided. I have really resisted the temptation to get too involved with the debate, especially on social media. In my opinion the conversation that is on-going has really represented the worst of our politics, even if it has got the whole nation engaged.

As far as I can make out there are currently four camps.

Camp 1: the "no" voters,
Camp 2: the "yes" voters,
Camp 3 the "I'm-going-to-say-I'm-undecided-but-deep-down-I-know" voters, and
Camp 4 the real "undecided voters", very shortly there will be a fifth camp of "I-have-already-voted-with-a-postal-vote-so-please-stop-talking-to-me-about-it" voters.

There is no doubt that there is a bit of "referendum-fatigue" kicking-in. Many people are fed up with the spraf that is coming out of both sides, and don't get me started on some of the Facebook and Twitter posts. Sadly, the debate that is presented in the main media has turned into a political circus. No clear answers, and some really pathetic pandering on both sides.

Former US president Bill Clinton voiced concerns at the start of the debate urging both sides not to "tear the place apart" (http://www.bbc.co.uk/news/uk-scotland-23013571), unfortunately, this has not been the case, though there is still time in this last stage to turn it around.

For me there are a few fundamental questions that remain unclear, and these are not really about the detail, a lot of which I still feel is missing, or is so unclear it is difficult to decipher what is fact from fiction. So here is the high-level questions that can be answered.

Question 1: What does independence actually mean?

Although it seems like an obvious and rather dumb question, it is, in my opinion, the starting point for any debate on this independence referendum. I have been asking this question for a while, and my anecdotal evidence (I know, the weakest form of evidence) is that independence actually means different things to different people. So instead of trying to give answers, I am going to challenge you by asking yourself "what does independence actually mean for Scotland", maybe you will extend the question to ask what it means for "me" but try to keep your answers separate.

Question 2: What does independence look like?

The follow-on question I have been asking people is: "What does independence look like". This question as you can imagine generates a wide array of answers, most of which are even less comprehensible than Question 1., usually the response is a scatter-gun of topical issues like the NHS, and being £500 better off. So ask yourself - "What does independence actually look like?".

For many the issue of being "able to raise what we spend" is a core part of their answer. Currently, Scotland can generate income from certain taxes. For example, the Scottish government has the power to vary the UK rate of income tax up or down by 3p in the pound. It was part of the Scotland Act 1998, which established the Scottish Parliament, but has never been used.

The other side of this argument is "we can choose how much we spend and on what". For me this is the absolute core of being independent. A country that can spend how much it wants, on whatever it wants, without restriction, is a true independent country.

The difficult thing about this version of true independence is that political and currency unions get in the way. An example of a political union restricting another nation is the limitations the European Union (EU) puts on fisherman for its member countries, or how the United Kingdom (UK) imposes restrictions on how fast motorists can travel on public highways. An example of currency unions putting limitations on countries would be where the central bank of the currency limits how much public spending & borrowing a member country can do in order to keep the interest rates under control, which is the current case in the UK, with its member countries (Northern Ireland, Wales, Scotland and England).

Ultimately, true independence is actually quite difficult to achieve - especially if you want to be part of other unions. Such as the UK and the EU. "If you want to join the club, you have to agree to the rules".

This has lead me to believe that to be really independent, Scotland must be brave and at least have it's own currency. It is difficult for people to accept this, but ultimately how independent is a country when it has another country telling it how much it can borrow, which affects how much it can spend? In my eyes that is not very independent. We should then be very, very cautious about which unions we look to join.

Question 3: What is the current club membership costing us?

Politicians are full of ~~bullshit,~~ sorry I mean "facts". So many facts, that in fact many are not really facts at all. For me I had to start by looking at what it is currently costing me to be part of our current club - the UK. Here is the breakdown for public spending of the UK club in 2013 (source: Her Majesties Revenue and Customs - HMRC), for the average yearly income of a Scot (£20,862).

Gross Income: 20,862.00

Income Tax: 2,170.60

National Insurance: 1,548.72

Net Income: 17,142.68

Total cost to be part of the UK club (2,170.60 + 1,548.72) = 3,719.32

This means my average rate of tax is 18% (every £1.00 I earn, I pay £0.18 in total income/NI taxes). Here is how the club sent our membership fees in 2013 (with specific breakdowns where data was available). Note: the % spent does not change regardless of income:

Welfare & Benefits - 37.6% - £1398.46 (of my £3,719.32)

- State pension and other retirement support - £616.72
- Sickness and disability - £255.92
- Family and Children - £146.84
- Social exclusion - £165.02
- Housing - £146.84
- Unemployment - £32.16

Health - 18.5% - £688.07 (of my £3,719.32)

No breakdown but includes: medical products and equipment, inpatient services, outpatient services, dental services, R&D, public health services and associate administration and support services.

Education - 13.0% - £483.51 (of my £3,719.32)

- Preprimary & primary schools - £169.71
- Secondary education - £202.11
- Tertiary (mainly universities) - £75.09

National debt interest - 7.1% - £264.07 (of my £3,719.32)

Debt payments comprise central and local government payments to the private sector and overseas.

Defence - 5.4% - £200.84 (of my £3,719.32)

No breakdown but includes spending on: military services, civil defence activities, foreign military aid, R&D, and associated administrative and support services.

Criminal justice - 4.7% - £174.81 (of my £3,719.32)

- Police - £98.24
- Courts - £33.21
- Prisons - £23.95

Transport - 2.8% - £104.14 (of my £3,719.32)

No breakdown but includes public spending on: national roads, local roads, local public transport, railways, and other forms of transport and transport infrastructure (i.e. airports and harbours).

Business and Industry - 2.5% - £92.68 (of my £3,719.32)

No breakdown. Includes all public spending on supporting agriculture, forestry, fishing, fuel and energy supply, mining, manufacturing, communications, labour affairs, tourism and other parts of UK economy.

Government Administration - 2.1% - £78.11 (of my £3,719.32)

No breakdown but includes: running local authorities, central government departments, and the largest area of spend is on cost of tax and rates collection (HMRC).

Sports, museums and Libraries - 1.8% - £66.95 (of my £3,719.32)

No breakdown. Includes spending on providing sporting and recreational services (e.g. parks), cultural services (libraries, museums, art galleries), broadcasting and publishing services, support to community based organisations and religious groups and associated administrative and support costs

Environment - 1.6% - £59.51 (of my £3,719.32)

No breakdown. Includes public spending on: collecting, treating and disposing of waste, sewage operation, water waste treatment, dealing with pollution, R&D, and associated administrative and support services.

Housing and Utilities - 1.5% - £55.79 (of my £3,719.32)

No breakdown. Includes public spending on developing social and affordable housing, providing public utilities and community services, and associate administrative costs.

Overseas Aid - 0.9% - £33.47 (of my £3,719.32)

No breakdown. Includes public spending on: economic aid, to developing countries and countries in transition, and economic aid routed through international organisations. Does not include peacekeeping aid.

UK overall contribution to EU budget - 0.6% - £22.32 (of my £3,719.32)

This is net EU receipts. This does not include contributions that go directly to the EU, such as custom duties which are not included as part of UK government spending.

Surprising?

When I looked at the breakdown of the direct cost to me for membership of the UK club, I was quite surprised. I feel that it is generally getting the proportions right, in some cases I was really surprised at how low the figure actually was. For example, I would maybe like to see £100/year of my tax go to Overseas Aid, rather than just £33.47/year. The Sports Museums and Libraries is an absolute bargain at £66.95/year. Actually, I feel that my contribution of £78.11/year to take care of an entire county's government administration is value for money. Just over £20/year to be able to travel and work anywhere in Europe without much hassle? Pretty good.

Bringing this back to independence. What does independence bring me that I can't already get through the current democratic process? Is independence actually solving a problem, or does the problem lie else where? In an independent Scotland, which bits are going to be reduced that would make me £500/year better off?

Question 4: Have we tried all other available alternatives to fix our problems?

To really answer this question we need to ask ourselves: "what are Scotland's problems?". Anecdotally, health, and poverty are two major issues. On the poverty issue, it is generational poverty / unemployment that is really, really bad for us. For every generation that is in poverty or unemployed the social issues around this multiply exponentially. Sadly, this problem is astonishingly difficult to solve.

Personally, I am not convinced we have tried all available alternatives that could solve these problems and improve lives of Scottish people, despite already having the powers to do so.

For example, some Local Authorities have some serious questions to answer about the the efficiency and quality of delivery of a number of core services. It is Local Authorities politics ( and delivery) that most normal people come into contact with first. Have we considered a radical shake up of Local Authorities in Scotland. Do we need 32 of them? Do they all need to have their own Education departments? Do they even deserve to have the privilege to run some of the most important services for the community? With recent consolidations in the Police in Scotland, could some parts of Local Authorities follow? If not, why not?

What about using our income tax powers to raise some more money that can only be spent in Scotland to help tackle the health and poverty issues we have.

Question 5: What are your motivations?

Finally, we all need to understand and respect that we all have our own motivations for voting in a particular way. Guess what? That is perfectly okay, although more recently in the debate people are beginning to forget this. For some it is about identity and national pride, for others it is about business and economic security.

For me? Well one of my motivations for choosing which way to vote is entrepreneurial support. Ultimately, we need people to take risk and generate jobs and wealth for our country. I have been absolutely blown away by the huge level of support I have received from both UK and Scottish business support organisations and individuals over the last 8 years I have been running my own business. What has not been explained clearly to me is how this will be even better if we were independent. The reason for which is pretty clear. Scottish-only businesses would potentially lose the support of the hundreds business support organisations that are available to businesses that are within the UK.

Final thoughts...

Which ever way Scotland votes on September 18th we all are just going to have to accept it, get on with it and look to the future. We are all going to have to live with one another after, so pointless name-calling and other nasty tactics are really unnecessary and really quite damaging.

Hopefully the questions above are able to help you make up your own mind about which way to vote if you are one of the real undecided voters. Which ever way that is then that is absolutely fine with me, just as long as you are clear about these questions and your motivations, and respect others for their viewpoint too.

Got your answers to these questions, put them in the comments below. I am not keen on comment warfare so play nice.

Niall's Notes