Archive for category Elections

Water – Scotland’s Liquid Gold?

plugholeI’ve not really had a chance to read the various manifestos that have been festooned upon the masses amid as much pomp, ceremony, media attention and balloons as the parties can muster. I gather Labour’s launch today was hit by a smoke alarm going off, rumours of someone’s ‘pants on fire’ are, as yet, unfounded.

The Lib Dems have pinned much of their election hopes on cash that could be raised from Scottish Water. Money may not grow on trees (as the SNP learned when considering selling off forests) but it might fall out of pipes.

Now, I’m going to try to give this idea the fairest crack of the whip possible, if only to avoid Douglas MacLellan tracking me down and, probably quite fairly, lamping me for being unduly harsh on the Scottish Lib Dems.

So, first of the positives is simply this: it is a relatively new idea. Labour has aped much of the SNP’s policies depriving the electorate of real choice. This suggestion from the Lib Dems provides real choice and is a juicy contribution to the campaign at large.

Second positive is that it is the type of dynamic, ‘outside the box’ solution that Scotland needs to get through this difficult financial period. We don’t have borrowing powers, we don’t have the tax-varying option (yet) and we don’t have an ever-increasing budget. The Tesco Tax has been rebuffed and the parties are circling around Council Tax, sniffing out its potential to close some funding gaps. What else do we have? Well, Scottish Water seems to be right up there as a cash cow so it’s asking to be explored.

Another positive is that companies do this all the time, selling debt on here, factoring debtors there. Who do you think holds your mortage debt? You might want to guess again. The practice has become part and parcel of running an efficient cashflow and if the benefits of early money can exceed the negatives of foregone inflows further into the future, then the approach is worthwhile.

This, to me, is where the Lib Dem plan starts to move into disagreeable PFI territory. Short term gain for long term pain, but I haven’t seen enough detail to make a fair comparison and the little that I can find is maddeningly light on what is actually being proposed. As far as I can make out, the sale of the Scottish Water debt would be covered by a bond issuance (private investors paying cash for guaranteed income over a set period of time) and the difference between the bonds and the debt is £1.5bn. How reliably this is arrived at seems to be anyone’s guess. Certainly my experience (from my current job, in Corporate Finance) is that refinancing is pushing the price of loans up, not down.

So this is neither positive nor negative but…. more detail is desperately required regarding what is being proposed here.

Now, the potential negatives. First up, the proposal states that Scottish Water would be a ‘public benefit corporation’. What does that mean? It sounds nice and fluffy but what sort of public benefit can be left once the debts have been flogged off? My initial suspicion is that there would be a private element to this venture.

Well, thanks to Wikipedia, the best example of an existing pbc are certain NHS Foundation Trusts and the BBC, in all but name at least. That sounds reasonable to me and not so far removed from its current status so a tentative crossing out goes against that worry.

My main concern is that the cost of water in Scotland would increase signifcantly over time in order to satisfy the cost of the private investment (bonds). Caveating the following given my only partial understanding of the proposal, but if you pull out £1.5bn from Scottish Water then you will inevitably have to put it back in at some later date, regardless of what the small print or technical detail says. That is just basic accounting and finance, surely. The Lib Dem proposal is to spend this £1.5bn of money on setting up regional banks (£500m), early intervention (£250m), energy saving (£250m), digital economy (£250m) and a “science nation fund” (£250m). All great ideas, (well, depending on what exactly the “science nation fund” is I suppose) but this cannot be ‘free money’ and it’s important to remember that. This is a cash advance, at a discount, from private investors, and the Effective Interest Rate has to be clear before we embark on this venture, or vote on it for that matter.

Another concern is the fact that the UK Treasury has not looked through the detail of this proposal and there is no guarantee that the amounts raised wouldn’t be simply creamed off the block grant, completely undermining the point of the whole venture.

In short, selling Scottish Water’s debt sounds like an idea that is worthy of further exploration and analysis as the gain may well exceed the pain but the conservative side of me naturally bristles against cashing in on long term considerations for short term benefit and it all just seems a bit too much too soon to be taken too seriously. If only the Lib Dems had checked it out with the Treasury first, it’d seem more plausible.

So, for me, the assumption has to be that this won’t work, certainly not at least until the Lib Dems are able to spell out the detail more clearly.

And they only have four weeks.

I don’t want to talk to you no more, you empty headed animal food trough wiper

This is a guest post from Aidan Skinner. He’s also not the Messiah.

As a Labour man, you’d expect me to say it’s all Alex Salmond’s fault. Well it is. The Holyrood 2011 campaign is a few weeks old and so far it’s been dominated by one man. Monty Python. The SNP started it with the “What have the Romans ever done for us” party political broadcast. Then Iain Gray joined in, doing his best Terry Jones impression at the Labour conference.

At which point it got silly. STV tried to make up for excluding Patrick Harvie from the debate and by showing him as the messiah in their iconography. The Liberal Democrats joined in by splitting into the Democratic Liberal Party (O’Donnell-Mcdaid) and John Farquhar Munro forming the Popular Front (Alex Salmond for First Minister).

It’s all very reminiscent of days spent setting fire to Space Raiders in student unions to see if pickled onion ones burn better than cheese (they do). As has, unfortunately, been the level of debate so far (reminded me of student days, although I’m sure some would like to set all of Holyrood a light with a Bic). With Labour and the SNP occupying much the same policy ground and dominating the share of the vote it’s all been a bit “I put it to him that he smells and should TAKE A SHOWER”. Policies are being stolen, positions are being triangulated,blusters are being.. blown? Anyway, I don’t think Sunder Katwala’s prediction of a red-yellow coalition is likely, but he does have a point about the virulence of the debate between the two being at least partly due to the broad similarity of the policies and the search for synthetic differences.

Ultimately, though, I think there is one big difference. And that’s the form the two administrations could take, as has been outlined in this blog previously. Another SNP minority government with Tory support is conceivable but I can’t really see Annabel Goldie leading her troops into a tacit agreement with Labour. John Reid’d blow a blood vessel for one thing, and who’d clear that up? The Lib Dems arealso pretty toxic to Labour at the moment, and might not even have enough seats to put together a majority Labour-LibDem government anyway. So perhaps the difference is less one of substance, more who’s going to come to whose painfully obscure indie night. Hopefully now we’re in manifesto week we’ll get some actual substance. They’re rather dry and dull things though, so here’s a handy precis of what you can expect to see from each party:

Tories – due to the mess we inherited from Labour all you can have is dry toast. As the former first secretary to the Treasury said “there is no jam left”.

Lib Dems – at the last election we promised jam for everyone. We didn’t win outright, and due to the mess we inherited from Labour all you can have is dry toast. We still hold to our Liberal Democrat policy of jam tomorrow.

SNP – the London government has imposed budget cuts so all you can have is dry toast. In an independent Scotland we’d be able to use oil revenue to purchase jam for everyone.

Labour – due to the savage and unnecesssary cuts imposed by the Tory-led government in Westminster everyone has to have dry toast. We have however secured a new jam-making apprenticeship scheme so the young people of Scotland can learn to make jam tomorrow.

Greens – our continued dependence on jam is unsustainable. Everyone should begin a transition to rape seed oil spread.

Getting ahead of ourselves…

This is a hypothetical situation… don’t worry about the numbers so much. We’ll know soon enough whether the predictions Jeff and I (and Kate, over at A Burdz Eye View) have been making will be on the money or nowhere near.  But I want to cast my eyes and our collective brains to possible outcomes.

It is now 6 May. The results are in. The campaign is (thankfully) over. We now have the following break-down of MSPs:

Labour (or SNP) – 52
SNP (or Labour) – 50
Conservatives – 16
Lib Dems – 7
Greens – 3
Independent – 1

For this analysis, it doesn’t really matter who wins the most seats, but we can run the potential outcomes with both Labour and the SNP as the largest party.

Suppose these numbers are accurate (give or take 2 or 3 seats, which I know could make all the difference, but bear with me). Also, considering that we’ll need a Presiding Officer from somewhere – likely from Labour, since we’ve had Lib Dem, Conservative and SNP MSPs fill the PO’s chair in the first three sessions, the numbers will need revised to account for that.

In this scenario, the only potential winning combination is between the winning or second place party and the third place party (52 + 16 = 68, 50 + 16 = 66). In reality, the third place party is the Conservatives, and formal coalition between them and either the SNP or Labour seems unlikely (verging on impossible). Indeed, any kind of Conservative agreement to sustain Labour in power (as a minority administration) seems unlikely. There is more likelihood that some kind of deal between the SNP and the Conservatives could be done – its unlikely to involve ministerial positions for the Conservatives, but could be a policy-for-power deal: maintaining the SNP in power and passing budgets for the pursuit of several Conservative policies (which we’ll find out more about after the manifesto is published).

But if that can’t happen, or if we’re in a situation whereby Labour win the most seats and the Conservatives feel that, tactical considerations aside, morally Labour have the first opportunity at being the government, what then? Two options, I suppose – Labour minority government (which, if they had the most seats, would be the logical way to go first) or SNP minority government, which has the potential to follow a failed Labour administration.

But here’s something to consider. The vote for First Minister. You only need 2 MSPs to nominate you for FM, and you can be in the contest.

In 2007, after a limited deal was worked out between the SNP and the Greens, well short of even “confidence and supply”, the Greens did not put forward a candidate for First Minister and cast their votes for Alex Salmond on both the first round (when there were four candidates) and in the run off between Salmond and Jack McConnell (incidentally – Margo abstained on both votes).

In 2003, however, there were SEVEN candidates for First Minsister:  Dennis Canavan (Ind), Robin Harper (Green), Margo MacDonald (Ind), Jack McConnell (Labour), David McLetchie (Conservative), Tommy Sheridan (SSP) and John Swinney (SNP), with Jack McConnell taking all Labour and Lib Dem MSP votes, totally 67 and being elected as FM.

I guess the point is this: how desperate will Labour or the SNP be to stop their rival taking office? Meaning – if neither can secure a formal coalition or agreement with any of the other parties to take them over the threshold, might either consider voting for another party to take office, to buy time? Specifically, if the Greens had 3 MSPs, or indeed Margo found an SNP MSP to nominate her, might either party consider voting for either Patrick Harvie or Margo MacDonald as First Minister?

It sounds far-fetched. In fact, it sounds downright loopy – a political party sacrificing itself and its own opportunity to put another party in office without an agreement in place. And, of course, many of you will think – this being a Green-leaning blog – that I’m “punting the party line” or making the Greens out to be in a more powerful position than they perhaps will be.  You’ll have to trust that isn’t what I’m up to.  Its just that, from some of the sheer loathing I’ve heard expressed from SNP and Labour activists in the early days of this campaign, I’m willing to believe that both parties would rather see any other party in power than their bitter rival, despite whatever policy and/or ideological positions they share.

Thus, if neither can make a formal agreement (either for full coalition or for support as a minority administration) with the Conservatives or the Greens, would they then vote for someone else as FM? This is where the numbers are important. If you are the larger party, there is no way you’d consider it.  But if you were the second party – and you have 50 MSP votes – you could direct them to vote for the Green candidate for FM which, with their 3 votes, would surpass the leading party’s 52.

In fact, this is perhaps more likely (if it is likely at all) to come from the SNP than Labour. Given the primacy of the constitutional issue (above all else) for them – to spin a Stephen Noon question around – would the SNP prefer a pro-union Labour party in government to a pro-independence Green First Minister?  If not, this is a course of action which might help them out in stopping a Labour First Minister after the election (if the numbers worked out).

No mistake – this is a desperation play.  And I doubt very much that any party would go for it.  But two things it has in its favour: it buys time beyond the 28-day period in which a First Minister has to be elected in order to conduct coalition discussions and it would stop a detested rival from taking power.  We can perhaps add to that a potential third advantage to those who would vote them in – the “temporary” First Minister would have all the responsibilities of governmental office, meaning that whoever put them there might be able to escape some of the political backlash for any unpopular governmental decisions made in the time period.

Unlikely – yes.  Something to consider?  It probably already has been…

Who loves ya, baby?

Relax, ParliamentThe Scotsman got YouGov to ask a lot of questions last weekend, and one on coalition partners went largely unnoticed. The results are on page 4 of this pdf – it’s the same poll which put the Greens ahead of the Lib Dems for the first time.

The respondents first got a forced choice between Labour and the SNP, which showed – SNP 44%, Labour 42%, Don’t know 13%. As those who watch the cybernats’ attempts to bait me on Twitter know, I’m firmly in the third group.

Anyway, the next question asked people if their preferred party did not win enough seats to govern on their own, which other party would be your preferred coalition partners, with these overall results:

Minority: 20%
Lib Dem: 16%
Green: 14%
Tory: 13%
Labour: 13%
SNP: 13%
Other: 3%
D/K: 8%

It seems likely that the relatively stable experience of the 2007-2011 session has made minority more popular, although the SNP having one party they could rely on throughout every Budget vote is not a luxury a Labour minority administration could expect.

Given that an outright majority is as likely as a Lib Dem surge, it’s pleasing from a Green perspective to see a seventh of punters prepared to see us in office, if a bit surprising to see the Lib Dems come out marginally ahead there. Only 5% of this sample were voting Lib Dem, but more than three times that have them as their preferred minority partner. They may be too toxic to vote for, but there’s presumably enough residual sympathy to give them the equivalent of a higher ranking under STV. Alternatively, if you’re a die-hard big-party supporter who doesn’t pay too much attention to politics, they perhaps just look like the least worst of the parties you’re familiar with.

Anyway, this is just idle speculation. The real, if slim, purpose of this post is the party-by-party preferences at the bottom of that page.

The symmetry is extraordinary. 11% of Scots are Labour voters who would prefer a SNP Deputy First Minister, and 11% vice versa. 7% each are Labour or SNP voters who would prefer Tavish as DFM, and 6% each are Labour and SNP voters who’d put Patrick into that position.

In one sense it makes sense: on recent form there is little by way of a left-right ideological dividing line between Labour and the SNP. There’s only one question which divides them here: those who want Salmond to stay on as FM are twice as likely as Gray’s supporters to want to see Annabel take a Ministerial Mondeo. Just a straw in the wind, and 8% to 4% is barely outside the margin of error, but still perhaps reflective of that close working relationship the SNP and the Tories have had throughout this session.

They came, they saw, did anyone conquer?

We were beginning to think you guys might be fed up of our boring election predictor chat, so we asked “The Burd” (aka Kate Higgins) if she’d like to contribute something.  We’re delighted she said yes – so here’s her take on the week’s election campaigning.

If you didnae know there was an election on, well you ken noo. Not content with chopping down forests to swamp us in leaflets, nor disturb our peace by daring to chap at our doors or phone while we’re at our tea, those pesky political types are now hogging the headlines, the airwaves and the ether. No platform is currently safe from folk in search of votes. It will all be over soon enough…

So how are they all doing at the end of the first full week of campaigning?

The SNP:
Ah yes, the shiny happy people. Who want you to vote on their record, and for their team and vision. Except when they’re putting Alex Salmond for First Minister on the regional vote ballot paper. The first leaders’ debate on STV was a cakewalk for the former First Minister who scarcely had to change gears to swat away the opposition. They have a strategy, they have money in the bank, they have a stellar endorsement, they have momentum in the polls, they have catchy themes like Fairness Friday (okay sort of catchy), they are winning the Twitter wars…

Yep, it’s all going swimmingly: what could possibly go wrong?

Well, they’ll have to do something to make that local income tax story go away – expect Labour to make more of the what have they got to hide line in the coming weeks if not. And they definitely have to do something about the Tories courying up to them and playing the funny woman to their straight man. The Scots don’t like the Tories remember?

Labour:
Who would have thunk that we’d be talking about Labour, with its indelible right to govern stamped through Scotland like a stick of rock, as the underdogs? They might be ahead in the polls but it’s now by the slimmest of margins; Iain Gray is struggling to get recognition never mind compete on equal terms with Salmond; their website is safe but dull; all their best policies have been pinched from the SNP, and they just haven’t got the money to compete in the shiny stakes.

But they have invested in their organisation and are doing what they said they would, fighting this election on the doorsteps. Prosaically, they are battling for every vote in every target seat, especially the Liberal Democrat ones. Their theme comes straight from Private Fraser, as portrayed in the just-launched higher taxes ball and chain poster.  And interestingly, for all that the content lacks a tangible, buzzy coherence, it does at least focus on people, unlike the issue-driven approach from the other parties.

They’re not setting the heather alight, but they’re getting on with getting on.

Scottish Conservatives:
This has been a good week for them, and in particular, their leader Annabel Goldie. After a god-awful start with the launch of their campaign overshadowed by candidate wars in Glasgow. While the other parties crowd around the centre ground, they have something distinctive to say, which at least gets them noticed, even if no one intends to vote for them. Or at least are not telling the pollsters they are. They might not have managed to get Annabel tweeting but there’s a slick media operation at work here. The Haguesque theme is clever, trumpeting a common sense approach to issues while emphasising how they have delivered for Scotland in the past.

No wonder their tails are up.

But scratch the surface and there lurks an unhappy party, with trouble in the ranks and leadership contenders circling like sharks. And while the Auntie Bella routine might go down well with the meeja, the Scots ain’t buying it. She may be having fun at Salmond’s expense but it’s a bit of a shortsighted tactic: don’t the Tories need the SNP to win if they want to go on delivering for Scotland?

Liberal Democrats:
Dearie, dearie me. This Scottish election might well mark a watershed in Liberal politics and for all the wrong reasons. Tavish Scott came across as earnest and instantly forgettable in the first debate; their policies are not distinctive enough from the big two to garner interest; the website is a mess. Mixing Westminster “achievements” with Scottish election missives doesn’t work and simply serves to remind the goodly voters why they are girding their loins to give the Lib Dems a kicking.

The Scots have been casting around for a scapegoat for the mess we are in and it looks like the Lib Dems are it. Can they go any lower in the polls? Well, there are still four weeks to go…

Scottish Greens:
This is where big really is beautiful: if two is a crowd, what hope for the fifth party in Scottish politics to make its distinctive voice heard?
Despite the strong message, articulate and punchy leader and effective pitch for the protest vote, the odds just seemed stacked against them in this election. Few of the reasons have anything to do with anything they are doing.

Leapfrogging the Lib Dems in the polls won’t do them any harm but they do need a bigger bang for their buck. They need media coverage and that means turning up the volume on a hot topic like nuclear power. Time too to stop playing at being a national party and go loco and regional – keep Patrick, replace Robin and anything else is a very good night.

My moment of the week?

Has to be Alan Cumming’s endorsement of the SNP – this is an A list celeb at the top of his game whose endorsement was thoughtful and articulate. Unlike others who have gone global, his graft for his achievements is something we still recognise and so, yet to snub him, his opinion will be respected. It made Labour’s wheeling out of Alex Ferguson look tired and formulaic.