The report read like a litany of taboo subjects that were not to be discussed during the first decade of plenty for the Scottish Parliament, including: removing Scottish Water from the public sector; introducing targeted rather than universal benefits; reducing rather than increasing staff numbers; removing the ring-fencing of health from any real-terms cuts.
But the biggest problem in achieving “lift off” on this debate still lies with the present generation of Scottish politicians.
The tone in which the report addresses them is practically a beseeching one -- “the Panel would strongly encourage the maximum degree of frankness and cross-party agreement about the scale of the problem, potential solutions and the necessity to act now”.
Will the politicians heed the call? The omens are not good. Past debate has merely proved divisive, so a new start is needed. But an election looms early in 2011. The conditions that could engender grown-up debate and cross-party co-operation could hardly look worse.
Indeed the initial reactions by political parties were a repeat of the usual name-calling and blame-shifting. A lot will have to change if the proposed cross-party talks asked for by John Swinney are to prove meaningful and worthwhile.
Beyond the attitudes of politicians, what else lies in the way of progress on the IBRP’s proposals?
The time constraint clearly does.
We only have eight months left until the start of the next financial year. Also, 2011-12 bears the heaviest burden of all in terms of cuts, down around 4% in cash terms.
The issue of timing starts to merge with a potential process and management problem in that it is far from clear that the Scottish Government is geared up to take forward the next steps in an efficient manner.
First of all there is the clear breach of proper demarcation, given that the Minister for Finance is also a large budget holder in a spending department. This potential conflict of interest is exactly the reason why almost every other government in the world has a stand alone Minister for Finance, with only a very small budget under their control.
Second, is Swinney’s Office for Finance and Sustainable Growth appropriately staffed to carry out such an exercise? In the past its civil servants have been used to nothing more onerous than deciding where any extra cash should be doled out to. Now it needs to have good, standardised information on where the cuts would cause least damage.
But we already know that the information base on which decisions could be made is extremely poor. We don’t even know where our higher spend on schools or health over other nations in the UK goes to in Scotland, let alone whether this higher spend produces extra outputs that are worth retaining.
Also, who will ensure that all Scottish spending bodies will be applying a consistent set of assumptions with regards to inflation, risk, etc?
Furthermore, who sets the priorities? The IBRP outlined six core principles that might apply to ranking services or programmes, plus five supplementary factors which also need to be taken into consideration. That’s 11 factors that impinge on decision making!
As if that wasn’t complicated enough, who makes the call on the inevitable trade-offs that will apply, for example between economic growth, inequality and climate change?
No post-devolution Scottish Government has needed to be very good at this sort of prioritisation exercise, as all they have experienced are real-terms increases, of over 5% a year on average, on their budgets.
Now they are looking at 5% a year real-terms cuts, so such prioritisation skills become crucial.
The Beveridge report launches a difficult process of transition, but who is going to drive it forward? Twice in his chairman’s message, Crawford Beveridge calls for strong leadership to be shown in order to take the debate forward sensibly and quickly. In other words, it is high time we stopped talking in terms of political rhetoric, of “perfect storms” and “black holes”, and to begin to engage with the difficult choices.
A good starting point might be if, after accepting Swinney’s invitation to talk, the big four political parties in Scotland each put forward their proposals, based on the Beveridge report ideas for cost cutting and on the £3.7 billion real-terms cut expected to be needed by 2014-15.
Where common ground exists, over the majority of points I suspect, this can be agreed and banked. The remainder, perhaps as little as 10-20%, can then be legitimately haggled over.
Only time (and limited time at that) will tell if such a statesman-like outcome will emerge. If the politicians disappoint, it will be up to other players -- in the media, academia, service providers and budget holders -- to force the pace and to demand clarity on why and how future funds are to be distributed.
John McLaren is a member of the Centre for Public Policy for Regions in Glasgow
