manifesto for Scotland's public services
Sustained long term investment is essential if we are to revitalise
Scotland's public services. This must include the revenue to run
day-to-day services and the capital to rebuild the infrastructure.
The recent increase in public sector funding has begun to tackle
the problems caused by years of under investment. Adequate funding
is necessary to provide the infrastructure, proper staffing levels
and to fund fair employment standards and training. Modernising
public services effectively is not a one-off task but an ongoing
process. Adequate funding also encourages staff to develop innovative
solutions to service delivery rather than cope with service cuts.
Whilst recent funding increases have been welcome there remain
serious funding problems. In particular, local government has
received less favourable treatment than other public services
despite significant new responsibilities and funding challenges
including the cost of past pay discrimination.
Long term investment
Secure long-term funding is crucial if public services are to
plan for the future. As public services involve users in making
decisions about future services it is even more important that
information is available about the future level of resources.
This equally applies to the funding of community and voluntary
organisations in order to assist them in raising their standards
Level playing field between public &
The drive to rebuild Scotland's ageing infrastructure has involved
the extensive use of Public Private Partnerships and the Private
Finance Initiative (PPP/PFI). Billions of pounds of public money
have been wasted. The Executive claims that this is only one of
several procurement options for public bodies. It is not even
the preferred option. However, for many capital schemes it is
‘the only game in town' as the Executive subsidises PFI and not
conventional procurement. If we are to translate the Executive's
claim into practice, much more needs to be done on the alternatives
to PPP/PFI in Scotland.
Some of the alternatives require amendments to Treasury rules
including new definitions of public expenditure in line with European
models.‘Off balance sheet' incentives inherent in the current
block grant system and Departmental Expenditure Limits (DEL) also
need reform. Enron economics is no way to finance our public services.
Progress could be made within Scotland by providing capital grants
on a basis that gives public authorities a real choice between
funding sources: A ‘level playing field'. There needs to be a
substantial increase in capital funds and the freedom for all
public authorities to borrow to fund investment. The Executive
has made progress on this by giving local authorities prudential
borrowing powers. But these powers are limited if grants are only
available to those local authorities who use PFI.
Other claimed alternatives to PPP, such as ‘Not-for-profit trusts'
are still PPP schemes with a different form of company structure.
In the main this is simply window dressing.
Conventional borrowing remains the most cost effective and flexible
method of financing public services. It retains accountability
and enables public authorities to engage in genuine consultation
with service users without the smokescreen of commercial confidentiality.
Public spending and the economy
Recent debates in the Scottish media have been highly critical
of the scale of public spending in Scotland. Research commissioned
by UNISONScotland demonstrates that there is little or no evidence
over the long term, of a negative relationship between public
spending and private investment. In fact public investment is
crucial to the success of the Scottish economy. UNISON believes
that Scotland can afford to invest in its public sector to create
world class public services for all.
At an international level, there is no significant link between
countries with high economic growth rates over the 1990s and levels
of government spending and personal taxation.
Equally significant is the relationship between tax receipts
and income equality. Countries with higher state involvement generally
have lower levels of income inequality, suggesting that government
intervention remains important in ensuring wealth is fairly distributed.
Claims that Scotland's public sector has crowded out the private
sector in recent years are largely unsubstantiated. Other sectors
have shown more rapid rates of employment growth. Scotland's public
sector employment - at around one quarter of total employment
- is less than the third claimed by critics.
Scottish public sector institutions are critical to the success
of the Scottish economy through providing basic infrastructure
as well as key human and technological resources for emergent
sectors such as biotechnology. Public debate needs to move beyond
a simple dichotomy of public sector ‘bad', private sector ‘good',
to develop a more sophisticated understanding of how the two inter-relate
in successful and balanced economies.