Being expected to have all the answers to our economic conundrum is a bit of a tough gig in the current climate. Thank goodness then that the Finance Committee in the Scottish Parliament can call upon the services of Professor David Bell. His report on the draft Scottish Budget 2011-12, produced in record quick time, provides detailed analysis on a range of measures announced by John Swinney. The one which garnered all the headlines was his assessment that the council tax freeze would contribute little to the government’s own priority of sustainable economic growth.
You could almost hear Scottish Labour rubbing its hands with glee. But the burd wonders if they will gain much political capital from trashing this SNP policy.
Treating the council tax freeze as an economic measure fundamentally misses the point. No matter how John Swinney dressed it up in his budget, this is politics pure and simple. It’s the perception of what this policy delivers that counts rather than the reality. And Professor Bell’s analysis actually serves to underline this.
The economic gain to households is marginal. At best families stand to save a whole 0.3% of their net income. It’ll not even begin to replace what folks are losing out of their pockets in increased VAT charges after January. But look again at the groups that do stand to gain something and do the electoral maths. The families who gain that 0.3% are Scotland’s squeezed middle. Moreover, a household with two pensioners will be best off, closely followed by families with children. In short, the ones that vote, and the ones that the SNP need to vote for them in the key marginal seats that will deliver a second term in government, are the net gainers here.
And because Scottish Labour also needs the votes of such individuals in many of the same seats, the party is hardly likely to be dissing the freeze on their doorsteps. Indeed, it would be a brave opposition that argued for taking more money out of people’s pockets in this election unless for a specific purpose. It doesn’t matter that the gain is miniscule; it’s the perception not the reality that counts. And what’s the alternative? That a Scottish Labour government would raise the council tax or allow it to be raised? Without reform? Hmm. Everyone knows it’s an unfair tax that disproportionately hurts – yep, pensioners and low to middle income households the most. Who would vote for that?
If Scottish Labour makes this a key electoral issue they might just open the door to the SNP. The most recent poll already suggests that this policy has real support from voters. Anything which draws attention to it serves neatly to draw attention to its architects, thereby helping to resolve the problem – see Lallands Peat Worrier’s superlative post on this – that the SNP does not appear to be garnering popular support from its most popular policies. This is dangerous territory for Scottish Labour to tread into.
Moreover, once the “real” election campaign starts, the SNP isn’t going to care that freezing the council tax doesn’t actually make people better off. It has a populist and popular policy to trumpet and that is what will give it traction and even better, momentum. The details are semantic and no one will care. Again, it is the perception of a party being on hard pressed families’ sides rather than the reality that will count. And even better, the SNP will be able to do this at the time the worst of the ConDem cuts and changes start to bite.