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Saturday, April 24, 1999 Published at 10:19 GMT 11:19 UK

The battle of the Union, 1999

Brian Taylor: Labour-SNP fault line

BBC Scotland's Political Editor Brian Taylor reports:

This is history in the making. This is constitutional innovation. This is a subject of endless fascination to the academics, lawyers and pundits. But mostly this is blood-red politics of a gravity and, occasionally, ferocity rarely witnessed in these normally tepid times.

Welcome to the elections to the first Scottish Parliament for nearly 300 years. Not of course the first-ever Scottish Parliament. Until 1707 and the Treaty of Union with England, Scotland was an independent nation with an independent Parliament.

By that treaty, technically, both the Scottish and English Parliaments were abolished - although the combined entity continued to meet at Westminster, prompting many to regard the ostensible merger as an effective take-over.

Now there is to be a Parliament again in Edinburgh: but a devolved Parliament firmly, according to the Labour Government's devolution White Paper, within the United Kingdom. A wide range of Scottish domestic issues will in future be settled by the democratic mandate of that Edinburgh Parliament rather than processed through Westminster where the mandate may or may not coincide with the expressed wishes of the people of Scotland.

The UK Parliament, however, remains sovereign and will continue to govern the broad economy, defence, foreign policy, social security and other big issues. It is that division of powers - advanced by Labour, supported by the Liberal Democrats and now accepted by the Tories - which is itself under attack in these elections from a nationalist party in Scotland which wants to go further.

Independence argument

[ image: Yes vote: Celebrations greeted the referendum result]
Yes vote: Celebrations greeted the referendum result
Labour's plans may reasonably be regarded as reform of the Act of Union. They produce, according to some, the looser arrangement which many Scots would have preferred in 1707 had they been given the choice. The Scottish National Party, however, longs to table the repeal of the Act of Union itself.

In advance of these elections, there was much warm talk of a new consensual approach in Scotland. Certainly, Labour worked with the LibDems and the SNP in winning a double "yes" vote in the devolution referendum on 11 September 1997. Certainly, all four main parties worked together successfully in a steering group which drew up detailed plans for the practical operation of the Parliament.

They wanted, they said, a "family-friendly" body which would meet at sensible hours, follow the Scottish school holidays and open itself widely to public checks and balances.

All thoroughly admirable - but it led a few of the more rash analysts to urge that this spirit of consensus might extend to the political working of the Parliament. That was never a serious proposition for a simple reason. The parties have a fundamental disagreement over Scotland's future.

This is not simply a temporary squabble over economics or social policy. The SNP wants to end the union with England and establish Scotland as an independent member of the European Union. The other parties want Scotland to remain within the United Kingdom.

Bitter rivalry

[ image: Flying the flag: Scotland's nationhood is an election feature]
Flying the flag: Scotland's nationhood is an election feature
The new fault line in Scottish politics is between Labour and the SNP - with the Conservatives and Liberal Democrats apparently trailing but maintaining a clear presence and potentially seeking to play a significant role in the new Parliament should the voters deny an overall majority to any party.

The rivalry between the SNP and Labour is bitter in the extreme. The Tories may have been the party most rigorously opposed to Scottish self-government in the past - but the nationalists always knew they had to overturn Labour's power base in urban central Scotland to succeed.

From the other side, Labour may confront the Conservatives, its Westminster opponents. But the SNP is the detested enemy.

This is rough politics - with an edge added by the SNP's decision to take Labour on over the issues of tax and spending. In his Budget, the Chancellor Gordon Brown - himself, of course, a Scottish MP - announced that from next year the standard rate of income tax in the UK will fall from 23p to 22p.

The Scottish Parliament is relatively limited in its financial powers. It operates broadly within a block grant from the Treasury: continuing the system which funded the Scottish Office in its century-long task of supervising the administration of Scotland. It cannot touch corporation tax, VAT, National Insurance or the upper and lower bands of income tax.

Tax debate

[ image: Making news: Progress towards the election is being scrutinised daily]
Making news: Progress towards the election is being scrutinised daily
But the Scottish Parliament can vary the STANDARD rate of income tax up or down by a maximum of 3p. The SNP says it would make use of that power to thwart the Chancellor's proposed tax cut for Scotland alone. In other words, for Scotland it would freeze the rate at 23p while the rest of the UK drops to the new 22p standard tax band.

That announcement has prompted perhaps the defining argument of the entire campaign. The nationalists point out that the chancellor has also introduced a new 10p tax rate. They say that means that the average Scot will still be better off next year than they are now. Their standard rate will not go up - and they will benefit from the new 10p rate.

The nationalists say they are asking Scotland to forego the 1p cut announced by Gordon Brown which they characterise as a tax "bribe". The impact, they insist, amounts to asking average earners to do without a tax cut of roughly 2 a week.

That penny on tax in Scotland would raise an estimated 230m a year, starting next year. Over the remaining three years of the Scottish Parliament, the SNP says it would devote the money to health, education and housing.

By contrast, Labour says that the SNP plans will leave Scotland paying more in tax than the rest of the UK. That will disadvantage the Scottish economy, making the business sector less competitive and destroying jobs.

Labour warning

[ image: Class wars: Education is another battleground]
Class wars: Education is another battleground
Further, it says that the plan will hit more than two million Scots, including some pensioners, the relatively low paid and those small businesses who pay income rather than corporation tax. The SNP scheme, Labour warns, unpicks a careful construct from the Treasury - and makes a fair Budget unfair.

In addition, Labour says its new spending package will inject 4.1bn into the Scottish public sector over the next three years. Rivals say that money is welcome but only redresses the stringencies endured during the first two years of Labour Government.

The Liberal Democrats have derided Labour and SNP financial plans - stressing instead the need to make a full costing of present Scottish Office spending before deciding finally on taxation. The LibDems, however, are prepared to consider a 1p increase on income tax in Scotland to be devoted to education if it is not possible to find that cash in other ways.

The Scottish Conservatives make great play of the tax question. They have long condemned the Parliament's fiscal powers: what they memorably called the Tartan Tax. Not only would they not use the tax powers, they say they have detected a financial threat from other quarters which requires resistance.

The Scottish Parliament, they point out, will be in overall charge of local authority finance and must be prevented from forcing up council taxes through the manipulation of council grants or from levying other back-door charges.

With all those qualifications, caveats and variable party perspectives, this is obviously not an entirely clear-cut issue. But to some extent it is an elemental conflict between taxation and public expenditure: the sort of conflict seen only rarely in Britain since the drive by the Labour Party to ditch its tax-and-spend image.

There are other key issues of course.

  • The question of competence: who best can govern Scotland and manage the diverse range of issues to be controlled by the new Parliament from education to the health service, from the criminal law to transport?

  • The question of Scotland's future: will legislative devolution finally achieve the long-nurtured ambition of the British political structure to placate the Scots or will it lead to independence? (The SNP says it will hold a referendum to decide the latter point).

The 6 May elections in themselves, therefore, will not determine that question. The people of Scotland would have a further chance to say yes or no to independence - just as they did with devolution after the election of a Labour Government.

The SNP has made considerable play of its Scottish credentials at these elections. It styles itself "Scotland's Party" and argues that the other parties, to a greater or lesser degree, all have to look over their shoulders at Westminster or London party offices.

That approach appears to have borne fruit in that opinion polls suggest that Scots are more inclined to vote nationalist in elections to the Scottish Parliament than they are for Westminster, perhaps in search of an unquestionably Scottish voice to articulate Scotland's concerns.

But Labour, not unreasonably, points out that the nationalists would regard an election victory on 6 May as a mandate to open talks with Westminster about Scottish independence. Consequently, it argues that Scots who do not favour that ultimate destination should not take the first step on that road in devolved elections, even when independence is not immediately the issue.

Hitting that issue hard may have contributed to the apparent trend in polls this year which suggests Labour may have regained their lead over the SNP.

Then there are Macmillan's "events": the issues which arise in politics. Already there has been a substantial cross-party row over the SNP's declaration that it opposes the NATO bombing of Yugoslavia as "folly" and evidently unsuccessful. The party insisted its criticism was confined to the political decision-making - but rivals accused it of betraying the troops involved in the conflict.

Electoral dividend

But the core of this is the new Parliament itself - this powerful new body which will make the laws of Scotland, updating and reforming the canon of Scots Law which dates back before the union.

Labour says it is the party which has delivered on devolution after a century and more of sporadic campaigning from the people and parties of Scotland. Plainly, it expects an electoral dividend from that - while stressing also its practical credentials and policies.

The nationalists insist they will not wreck the new Parliament. Rather they will strive to make it work in the interests of the people of Scotland - while retaining the right to campaign for their ultimate objective of independence.

The Liberal Democrats say they are the true guarantors of devolution, the party of self-government for more than a century. The Conservatives say they are the bulwark of the union: expressed in their willingness, if it comes to a vote of confidence, to support Labour if necessary to prevent the SNP from taking power.

Truly, these are remarkable elections. New politics for a new Scotland.

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