Why we need a Tartan Third Way

azzuri · Why we need a Tartan Third Way

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Why we need a Tartan Third Way

The Scottish public sector is too big. This has become the equivalent of the dawn chorus of the early years of Scottish devolution. Two senior researchers, David Bell and Donald MacKay, have added their names to the debate, producing a report for a Sunday newspaper looking at the waste in the Scottish Executive. Their report should be taken seriously on a number of levels, however, their findings seem a little threadbare and open to question.

To arrive at their headline £4.6bn savings – £3.1bn identified by them on top of £1.5bn already ear-marked by the executive – they engage in all kinds of back-of-envelope calculations. For a start, across the public sector – health boards, education, local government – they make savings by simply calculating what would happen if the best performances were spread across the whole country. Secondly, their savings are based on significant cuts. While it might make sense to cut the number of Scottish government ministers, cutting the number of list MSPs makes the Parliament less proportional and more Labour dominated. More seriously, Bell and MacKay's savings programme involves the closure of primary and secondary schools, hospitals, water privatisation, the selling off of the Forestry Commission and extending prison privatisation. This comes across like some schoolboy exercise in producing savings or some Downing Street junior John Birt's blueprint fantasy for Scotland!

All of this has a serious political impact. Since devolution the Scottish political debate has become obsessed with the mantra that the Scottish state is the problem, it is too big, and the real solution is to make it smaller, freeing up talent and enterprise.

There are undoubtedly lots of problems in the Scottish state – the culture of it in parts; the over-Labour dominance in places; the conservatism and lack of imagination of ministers and civil servants. Bell and MacKay's research is full of polemical asides and tired references to the Scottish state being closer in size to Romania rather than Ireland.

Across the modern world, it is not the size of your state that matters, but what you do with it. The Irish and American states, as a percentage of GDP, are much smaller than Scotland. Yet our Scandinavian neighbours have similar-sized states in GDP and manage to be at the top of the world competitiveness league.

One of the failures of Scottish devolution has been the lack of imagination shown in articulating a sense of the public realm. The public realm is not automatically the same thing as the public sector. The public realm is about relationships and values that are different from commercial values and the market. It understands the idea of "public goods" – that things such as health, education and water need to be available to all and that access to such goods is the mark of a civilised society.

The notion of the public realm needs to be constantly nurtured, articulated and given a sense of meaning because of the power and encroachment of the market into most areas of society. The public realm should not be undermined by commercialisation, choice or contestability, nor by PFI/PPP contracts or privatisation.

Across the public sector, senior personnel are pessimistic about the future. This is based on their experience of the command and control of the executive, the idiotic managerial and consultancy mantras that inhabit the senior levels of institutions such as the BBC and Scottish Enterprise, and the power of the "state is too big" argument, which has prevailed by default.

We need a more nuanced and radical debate. Where do the public and private sectors start and finish? Are Eurast agency cleaners in the Parliament canteen public or private? What are Sodexho cleaners on short-term contracts in an NHS hospital? What of BAE systems – that successful part of the British arms industry – which is mostly funded by British government orders?

A more nuanced debate would stop focusing on size and look at the inter-relationships between the public and private sectors, and how they can best support each other. What are the best ways of providing education and health services? How can we avoid the perils of "producer capture", trade union vested interests, "corporate capture" and the march of the private sector and the consultancy class?

We can surely aspire to a better debate than the simplicities of the past few years. Is it not possible that Scotland – with its traditions of public service and professionalism – can steer a path on the public realm that avoids the pitfalls of the over-protective state and the Blairite McKinsey state? We could even call it a Tartan Third Way.