Devolution is a process not an event

As local government in England is handed additional powers and responsibilities, Lynda Towers, former Solicitor to the Scottish Parliament, gives her perspective on devolution and the lessons to be learned.

"Devolution is a process not an event". Political mythology in Scotland regularly attributes this comment to Donald Dewar, the inaugural First Minister of Scotland. In fact, it was uttered by Ron Davies the then Secretary of State for Wales. However, that does not make it any less apposite for what has been happening in Scotland over the last 20 years since powers came north from Westminster and the Scottish Parliament opened its doors in July 1999. What is also clear is that devolution changed Scotland, for better or worse. We now had a grown-up Parliament, in control of our own destiny. Or so we thought, until the first crisis appeared in August 1999.

A Sheriff Court at Lanark was about to release a patient on appeal under the mental health legislation. The press were quick to ask: “What about the others in similar circumstances who may be even more dangerous?" The new Scottish Executive (as it was called then) rushed to use the new powers even though the number of patients was closer to six as opposed to the twenty quoted in the media. The first Bill was introduced into the Scottish Parliament to deal with this issue and became the first Act of the Scottish Parliament on 8 September 1999. Some would have preferred a more "worthy" Bill to be first rather than one allowing the continued detention of patients at the State Hospital, Carstairs, but that was what events dictated.

That was an early lesson in not being able to control events and having the courage to use the new powers Scotland had been given. It was also a hard lesson for the politicians. The public had realised that our elected representatives were a lot closer and easier to interact with in Edinburgh as opposed to London.

Devolution in Scotland was and is very different from the growing number of City Region Deals and the changing role of local government in England and Wales with greater powers and funding streams being mooted and delivered. However some of the Scottish devolution experiences may be transferable or at least provide things to think about.

Scotland pioneered modern coalition central government in the UK with Labour/Lib Dem forming the Executive from 1999 until 2007. This was made easier by similar political ideologies north and south of the border and both parties sticking to the concept of collective responsibility. What was not seen from the outside however was the degree of constructive challenge which went on between the coalition partners behind closed doors. Those were the years of free personal care for older people, providing for adults with incapacity, free bus passes for the over 60s, the smoking ban and more legislation than even the most enthusiastic Parliamentarian could deal with.

The early administrations had the benefit of the post millennium growth years. Central and local government seemed to have sufficient monies to maintain a comfortable level of funding and relations between the two were relatively cordial. In the west of Scotland, the boast was that Labour votes ‘were weighed not counted’.

This came to an end when the SNP took power in 2007. They ran Scotland with a minority government which many, with hindsight, said was very successful if you are looking for consensual and collaborative government. However, they had the misfortune to be in power when the banking crash and its aftermath hit in 2008. Scotland suffered the same financial constraints as the rest of the UK.

Into this heady mix was thrown the Independence Referendum campaign and vote. This effectively lasted from well before the signing of the Edinburgh Agreement on 15 Oct 2012, which allowed a referendum to proceed, until 8 September 2014, the day of the vote, and beyond.

Much of the focus in Scotland was directed to promoting or opposing Independence and there were questions as to whether the ‘day job’ of governing Scotland was suffering. Every routine decision or innocuous piece of legislation was seen against an Independence background. There was a lot of arguing on both sides around the potential impact of Independence and we read a considerable amount of what we might now call ‘fake news’.

Despite ultimately winning the vote by a relatively comfortable ten percent on a huge percentage vote, the unionist parties then split up into their individual parts, and the SNP and Greens, the main Independence supporting parties, grew in strength and membership numbers. In June 2015, this led to the SNP victory in the Westminster election leaving only two non SNP MPs, one Labour and one Conservative, out of a total of 59 Scottish MPs. The SNP still had a strong presence in the Councils.

On 23 June 2016 everything changed again in the UK and in Scotland, with the Brexit vote to leave the EU. In Scotland, 62% of those who voted, did so to remain. The First Minister of Scotland was first out of the block in the UK with a declaration that this was a change of circumstances which meant Independence was back on the table and a new vote was now likely. While the UK government was still thinking, the Scottish Government produced the first official position paper, "Scotland's Place in Europe" setting out how Scotland's position should be reflected after Brexit and that Scotland should be at the negotiating table. There was also a consultation on a draft Independence Bill.

Against this background council elections were held in May 2017, councils were perceived to be struggling financially to maintain services across the board, controversial changes were being proposed in relation to their management of schools and many voters felt too much time was being spent on constitutional issues and not enough on emptying bins, providing social care and filling in the potholes.

The resulting election found a large number of councils in coalition and although the SNP took control of Glasgow, their main target, they were not as dominant as they might have hoped. The hunch was that voters were not perhaps as enthused for another Independence vote as the Scottish Government was counting on, despite the Brexit result.

While we in Scotland were then poised for some kind of independence related announcement, an even more serious announcement was made by the PM calling a general election. The result was seen in Scotland as bad for the SNP. They had anticipated a fall in their record June 2015 Westminster seat position of two years earlier but not the reduction from 57 to 35. It was interpreted as Scottish voters saying they had had enough of votes and another Independence vote was a referendum too far in the midst of all the Brexit uncertainty.

The outcome seems to be that an immediate Independence vote is off the table. A fairly substantive legislative programme for the Scottish Parliament was announced in September 2017. Financial constraints remain on public spending. The most recent budget report by the Fraser of Allander Institute suggests, "the economic outlook for Scotland and the UK remains fragile".

A key element of devolution is increased financial control. Those in the English regions on the cusp of devolution would do well to look north to see how this actually translates. As a result of the Scotland Acts 2012 and 2016 and the related Fiscal Framework agreement Scotland now has greater tax raising, social security and other general powers. However, so far, the new land and property transactions tax, the landfill tax, which is designed to reduce tax take in the long term, and Scottish Income tax have all raised less monies than forecast. Longer term, air departure tax will produce revenue but the Scottish Government has committed to reducing it at some future date.

These devolved taxes will eventually make up around 50% of the Scottish budget. The rest will come from Westminster via block grant payments. However the block grant to Scotland from the UK will be reduced to reflect the anticipated tax take. Unless Scotland can bring in more in tax than the block grant reduction the budget picture may not improve. It looks like there will be an income tax rise in Scotland soon. However Scotland is to have its own Scottish Fiscal Commission acting with regard to devolved taxes as a Scottish OBR to help with future forecasting. It will have a very important role.

Another key aspect to any devolved region is capacity. There are questions as to whether the Scottish Government has the practical capacity to use these new powers fully. Revenue Scotland has started slowly with relatively small taxes and HMRC is doing the practical delivery of Scottish Income tax with policy being set in Holyrood. A new Social Security body is being set up in Scotland but it is not clear how quickly it will be able to practically and fully deliver its limited devolved benefits. The Scottish Government has been keen to acquire the powers but capacity and experience issues mean it may not be easy to apply them fully in the short term. It remains to be seen if this will be true of the 111 post Brexit EU powers many of which are being sought by the Scottish Government. Capacity and funding will be issues.

Another crucial element to the shifting power balance is the ability and desire to work collaboratively. Nowhere is this more apparent than in City Deals. A number of new City Deals in Scotland have seen councils working positively together to use their powers to support and access the UK and Scottish Government development funding. They are also using existing arrangements to set up arms-length bodies to meet their needs. Joint integration boards are dealing with the thorny question of delivering on health and social needs, although some of these still have some way to go. The message has been to use all the powers and levers available.

Scotland and Scottish devolution has come a long way since 1999. Councils are operating very differently from their predecessors. Central and local government are more accountable. Constitutional lawyers have had a lot to say over these twenty years. Different skills are needed. Events beyond your control may have a major impact on progress. The key elements to success are control over finances, the capacity to actually deliver devolved powers and a focus on working together effectively. Innovation is the buzz word and working together an underlying essential.

Ron Davies was not wrong all those years ago so far as Scotland is concerned; devolution has certainly been a process and not an event and there is no sign of that changing anytime soon.

Lynda Towers, is director of Public Law at Morton Fraser and was formerly Solicitor to the Scottish Parliament.