Taxing issues: Holyrood Herald - w/b 10th March 2008

Summary

This week Will Patterson writes his first column for the Wardman Wire about events at the Scottish Parliament at Holyrood. This is a new one for both of us - a regular article on a Derbyshire-based blog about Scottish Politics, so comments are very welcome indeed about the “Holyrood Herald” weekly report.

This time:

  • The Lib Dems and the SNP go speed-dating.
  • The Edinburgh property market may ease after MPs Accommodation Allowances are reviewed.
  • The Labour/LibDem-controlled Stirling administration - the only Council in Scotland to cut it’s level of local taxation - is rewarded with a vote of no confidence.
  • Wendy Alexander’s Deep-Throat turns out to be Jackie Baillie, who gets roasted in return.
  • And the Convention of Scottish Local Authorities has a pow-wow after last year’s punch-up.

Burying the Claymore

Could this be the start of a beautiful relationship? After months of Scottish LibDem Leader Nicol Stephen refusing to speak to SNP First Minister Alex Salmond, the two have started to talk. After about a year of the Lab-LibDem Coalition being in effect continued into opposition, Stephen appears to have turned his guns around, criticising Labour and making nice with the SNP.

What’s prompted the change? Why, it could only be local taxation. The SNP managed to get 31 of Scotland’s 32 Councils to freeze their Council Tax rates. The 32nd Council - Stirling - actually cut it, though the Labour-LibDem administration there has been rewarded with a no-confidence vote, which they lost on Wednesday night.

Council Tax vs Local Incomes Tax

Anyway, the SNP and LibDems agree that the Council Tax is a bad thing, and they both agree that a Local Income Tax (LIT) should replace it. So with the SNP moving to implement a major part of their 2007 manifesto, it was only natural that the two parties would bury the hatchet and start talking. Problem is, they’ve stopped talking: the SNP want to set the LIT at 3% nationally, and the LibDems say that if it’s set nationally, it’s not a LOCAL income tax, and they want the rate to be set by Councillors. But they started talking at all, so progress has been made, and no legislation has actually been proposed yet: the Scottish Government is still consulting on the matter, so Finance Secretary John Swinney and LibDem Finance Spokesman Tavish Scott have four months to come up with something.

Yet if firm proposals do come to Holyrood, and the LibDems do support them, the vote will be tight, and there will be pressure on the Greens - who don’t support an LIT but aren’t too fond of the status quo either - to declare their hand, as the outcome could be in their hands.

Meanwhile, back at Holyrood

Meanwhile, Holyrood is allegedly the home of ‘new politics’, where MSPs don’t just simply ape Westminster practices. Which is why there have been three major expenses scandals since 1999, and why MSPs have panicked and agreed to a review of allowances.

Well, the review board have reported back, and if they have their way, membership of the Scottish Parliament will not be an easy way into property speculation, but MSPs will be able to hire more staff. Or at least, some will, and different parties will take different positions on the review depending on whether the bulk of their MSPs were elected in Constituencies or on the Regional Lists. In a way, it shows that Holyrood is different from Westminster, where in the aftermath of Derek Conway’s appointment practices, the parties fell over each other to look like they were the best at cleaning up their act and opening up their records. MSPs, on the other hand, will probably support whatever makes life harder for the other side.

Brothers, Sisters and Comrades - Apparently

And why need they bother, when Labour Leader Wendy Alexander has enough problems with her frontbenchers? Shadow Health Secretary Margaret has been caught briefing against her leader, and she wasn’t overly subtle about it, which makes her look both treacherous and rubbish at the same time.

She’s probably in line for an ugly punishment, but Convenership of the Equal Opportunties Committee is not in Wendy Alexander’s gift - a Tory is destined to exile in that end Scottish Parliamentary Siberia - and the LibDems have been lumbered with Convenership of the Subordinate Legislation Committee. So Curran will, I suspect, get sent to the Scottish Parliamentary Corporate Body, where she’ll find herself dealing with the Parliament’s procurement and expenses rules that have got people so wound up. If it does come true, it will be a cruel and unusual punishment, but it may be too tempting for Wendy Alexander to resist.

But what does Wendy Alexander do about Labour Councillor Pat Watters, President of the Convention of Scottish Local Authorities, who has been getting on rather better with the SNP Government than Councillors did with Labour Ministers before the election? Maybe she should set the Leader of North Lanarkshire Council, Jim McCabe, on him. Or she could see if he’ll step aside in favour of Corrie McChord, one of COSLA’s Vice-Presidents, and Leader of the aforementioned deposed administration in Stirling. He probably won’t be all that enamoured with the SNP - who suggested getting rid of him - right now.

Talking over tax

Until now, it’s fair to say that the LibDems and SNP have not been the best of pals, with Nicol Stephen’s party refusing to enter Coalition talks with Alex Salmond after the election, and LibDem MSPs still broadly aligned with Labour. However, things have started to turn: the two parties have been discussing replacing the Council Tax with a Local Income Tax. The negotiations have broken up without agreement for now, but it’s still an improvement in relations since May, when the two parties didn’t even speak.

The main sticking point is the rate: the SNP policy is for the tax to be set at 3% nationally. The LibDems counter that setting the rate nationally means that it isn’t a local income tax, and that Councillors should set their own rate. A compromise - that councillors would have some freedom to set the rate but that it would be capped at 3% hasn’t caught on. But it’s early days yet, and the Government’s consultation on the change has only just begun, so the LibDems have time to gain extra concessions.

Balancing the Seesaw

The problem is that even if the LibDems do get on side, the Government still don’t have a majority on this issue. The SNP and LibDems have a combined 63 seats, and Labour and the Tories - who are opposed - have 62. Margo MacDonald will probably vote in favour (if she turns up at all), so that’s 64-62, but there are two Green MSPs, and they support a Land Value Tax. So assuming that they don’t change their mind and support the LIT, then the Government have to convince them that the LIT would at least be an improvement on the status quo, and get the Greens to abstain. If they fail, the vote is tied at 64-64, so the Presiding Officer has to dust off his casting vote.

In these situations, the established way of doing things at Holyrood is not to vote with the Government, but to vote for the status quo. This basically means that the PO has to vote against everything. This means he would vote the Bill down, so the Greens will come under increasing pressure to make their position clear in the coming months.

We’re not like Westminster, oh no, not one bit!

Somehow, the story keeps coming back to expenses and allowances, proving that the Holyrood village is actually rather similar to its Westminster counterpart. MSPs argue that they’re quite hard done by: that they’re given less money than Westminster MPs or Welsh AMs to hire staff, but for all that, there have been a number of scandals involving parliamentary claims:

  • ‘Officegate’ was the first: although it involved Henry McLeish’s failure to notify authorities that he was subletting part of the office he was claiming rent expenses for while he was a Westminster MP, by the time details emerged, McLeish was First Minister and his poor handling of the story led to his downfall in November 2001.
  • ‘Taxigate’: McLeish’s Officegate main pursuer - Conservative Leader David McLetchie - was caught up in ‘Taxigate’, when it transpired that he was claiming back taxi expenses that had absolutely nothing to do with his work as an MSP, and resigned the Leadership in 2005.
  • ‘Flatgate’: The next big scandal came in the run-up to the May election, when it became apparent that East Lothian MSP John Home Robertson had, prior to his election in 1999, bought his son an expensive Edinburgh flat, then after the election, became his son’s tenant, and claimed the rent back from the Parliament.

Examining the Allowances

So it was in this context that the Parliament decided to establish an independent review of the Allowances available to MSPs, chaired by Sir Alan Langlands. He has now reported back, and it’s the Edinburgh Accommodation Allowance which is subject to his ire. The EAA allows for MSPs who live beyond a reasonable travelling distance of Holyrood to take out a mortgage to buy a property closer to the Parliament, which pays the interest charges on the loan taken out.

Property: Speculate no more. We hope.

However, one (hopefully unintended) consequence is that it helps MSPs turn into property speculators: the EAA makes it easier for them to buy a property, and doesn’t stopping them from selling it for a profit, which the MSPs themselves keep. Needless to say, Sir Alan thinks this is a bit off, and wants the EAA axed, though MSPs would still get help to rent a place, or pay for hotel costs.

Happy Families

Another feature of the report would see MSPs declaring on the Register of Interests when they employ a close relation, but an increase in staffing allowance, to £62,000 per annum for Constituency MSPs and £45,000 for Regional MSPs. This is still well short of the £85k that MPs get, but it opens up another can of worms: the old chestnut about there being two classes of MSP. Expect the SNP - most of whose MSPs (26 out of 47) were elected on the Regional lists - to cry foul; expect Labour MSPs - the vast majority of whom (37 out of 46) won Constituencies - to be in favour.

Holyrood vs Westminster

This is where politics at Westminster and Holyrood differ: at Westminster you have the parties falling over each other to look like the most transparent, and the one that wants to ‘clean things up’; at Holyrood, you have the different parties digging in to defend their position and give themselves the advantage. Which is more fun: naked populism or shameless tribalism? As Harry Hill would say, “There’s only one way to settle this… FIGHT!!!!”

Labour pains

The Pen is Sharper than the Sword

Labour’s Shadow Health Secretary Margaret Curran has been caught briefing against her Leader, Wendy Alexander. Following one Ms Alexander’s weaker performances at the end of last month, un-named Labour sources popped up in the press criticising her. No one would have batted an eyelid until Curran started chatting with other party members and her language bore an uncanny resemblance to that used by the ‘un-named sources’. Indeed, even Jackie Baillie - Labour’s Business Manager - noticed. And Baillie recently turned the air blue at a press conference when she failed to notice that her microphone was turned on, so she’s not the most observant of folks.

And Confession cleanses the Soul

Needless to say, Baillie hauled Curran over the coals, and I suspect that the air was even bluer in her office that day. It does seem that Curran eased her predicament by confessing, which raises another issue: while Alexander obviously has her critics, they aren’t all that good at the whole skullduggery thing. The problem is that Curran is on the front bench, and Alexander has to deal with the fact that not only is one of her senior spokespeople briefing against her, but she’s not doing it very well. As a result, I’m sticking a fiver on Curran being appointed Labour’s representative on the Scottish Parliamentary Corporate Body following the next Shadow Cabinet reshuffle, whereupon she will be bogged down in Holyrood’s procurement policy until she resigns in disgust.

Why can’t we all just get along?

The one thing of any interest to come out of the Convention of Scottish Local Authorities (COSLA) conference last week was that COSLA’s President - Labour Councillor Pat Watters - and the Scottish Government’s Finance Secretary John Swinney - a former SNP Leader - actually seem to be getting on. In the run-up to the Scottish Budget (which unlike the UK version focuses more on spending than taxation, which is understandable as most taxation powers are reserved), the Government agreed a ‘concordat’ with Councils, which emphasised ‘mutual respect and partnership’, and at the Conference last weekend, the two seemed to be sharing jokes.

Here’s why, perhaps?

At the Conference last year, Jim McCabe, the Leader of Labour-controlled North Lanarkshire Council said this of the then Finance Minister - and still Labour MSP - Tom McCabe:

“He said he’s my grandson. As you probably know, in every litter there’s a runt. We used to drown them, now we send them up to Holyrood.”

Ouch! Taking the contrast between the COSLA Conferences in 2007 and 2008, you’d think that Labour Councillors get on better with SNP Ministers than Labour ones. Can this be right?

To be fair, Councillor McCabe has served notice that he intends to break the consensus when he fancies it:

“If the need arises to apportion blame, I’ll do what I did with the past administration - I’ll apportion blame without hesitation.”

So maybe all this tells us is that North Lanarkshire’s Head Honcho is the Statler and/or Waldorf of Scottish Local Government. And that he’s not quite as funny as he was a year ago.

And finally

One addendum: one of COSLA’s vice-presidents is Corrie McChord, the Labour Leader of Stirling Council, or at least he was Council Leader until last night (Wednesday), when his Labour-LibDem administration was felled after the Tories supported an SNP motion of no confidence, and one of the Labour Councillors went AWOL, and the SNP now lead a minority administration. I guess the cosy SNP-Labour relationship doesn’t apply within Councils…

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About the Author

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Matt is an internet consultant, commentator, freelance writer and Project Manager based in the UK. He is available for hire. Matt edits the Wardman Wire, and writes at Poligeeks, Total Politics, and occasionally in several other places.

One Response to “ Taxing issues: Holyrood Herald - w/b 10th March 2008 ”

  1. [...] of what’s going on in the various parliaments that affect life in the UK. This week, the Holyrood Herald was inaugurated and is under the care of a smart, funny, dashing and drop-dead-sexy (not to mention [...]

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