Post-pandemic economic recovery was on the agenda at Holyrood this week, with Scotland’s finance minister Kate Forbes in full JFK-style ‘ask not what your country can do for you’ visionary mode.
‘Wherever someone works, and in whatever capacity, if they think that they can serve our country as we face the prospect of rebuilding, this is their personal invitation. Our strength is in our united vision to work together — across party lines, sectors and regions — to rebuild,’ declaimed Forbes.
A cynic might wonder if ‘serve our country’ will turn out to mean serving the nationalist interest rather than the national one. It would be no surprise if trade organisations, business leaders and others discover that engagement quickly turns into an arm twisting to get them to add their names to a press release demanding more powers from Westminster. A cynic might also point to the SNP administration’s abysmal record on industrial policy and wonder if the best course of action might be for Forbes and her colleagues to stand well back and let individuals and businesses get on with the task of recovery without their guidance.
But intervention, or at least being seen to be interventionist, is the name of the game. And so in coming months the Scottish government will produce a ‘ten-year national strategy for economic transformation that will set out the steps to create the best conditions for entrepreneurship to flourish’. There will also be a new ‘council for economic transformation’.
The SNP regularly frames Toryism as an English phenomenon, alien and even hostile to Scotland
Could these and other efforts drive a sensible recovery? Pessimism about past endeavours aside, there are things the Scottish government could do to help boost Scotland’s economic rehabilitation.
One example is tapping into the trend of professionals moving away from big cities as flexible working becomes the norm. In its January UK Economic Outlook report, consultants PwC noted London’s population is set to decline for the first time this century. The report says: Covid-19 has fundamentally changed the way we view cities. City-dwellers are now rethinking their living situations in light of the pandemic, and re-evaluating the importance of larger homes, green spaces, and connections with the local community. We anticipate that in 2021, this shift away from city-living will mean that London’s population could decline for the first time in the 21st century.’
Relatively high-salaried and newly remote Londoners looking for a quality-of-life upgrade is a one-off opportunity Scotland can exploit. Look at the positives that would come from attracting such people.
It would expand Scotland’s tax base, which will be crucial to rejuvenating the economy. The management consultant moving from North Kensington to North Berwick brings with her a hefty stream of future income tax and spending into the Scottish economy. The shift away from the big cities of the south could also help reduce regional inequality and alleviate the demographic challenges of an ageing population. It might even boost productivity and help the environment as less commuting, more focused work time and less stress creates a happier, healthier workforce.
How then can the Scottish government encourage these moves? Tax incentives would be an obvious tool. The government could, for instance, reduce Land and Buildings Transactions Tax (Scotland’s equivalent of stamp duty) for people moving to Scotland, perhaps linked to employment status so as to ensure those taking advantage of the offer will genuinely bolster the income tax base.
On the targeted spending side, investment to improve infrastructure, especially broadband, would go a long way to nudging the Zoom worker to move to a rural location. Improved north-south rail connections would also help.
Will we see steps like this taken to incentivise relocation to Scotland?
The only barrier could be nationalist politics. The SNP talk a lot about being open and inclusive, but extending this attitude to well-to-do folk from the south of England who might be no stranger to putting an ‘x’ next to the Conservative party on a ballot paper could be a step too far. Indeed, implicit in much of the SNP’s attitude to immigration is a qualified welcoming: if you wish to come here and bolster the nationalist cause then you will be embraced warmly, but come here with notions of opposition to the SNP and what it stands for then be prepared to be treated as anti-Scottish.
After all, the SNP regularly frames Toryism as an English phenomenon, alien and even hostile to Scotland. And there have been several examples of alleged anti-English rhetoric over the past year. None of this will encourage people from the south to feel comfortable moving north.
That is unfortunate, because the migration of southern city workers north of the border would be a win-win for all concerned, and a definite boost to Scotland’s post-pandemic economy.
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