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The location of New Ministries in an Independent Scotland

Read the full paper here

“The Scottish Government needs to prepare a detailed plan for the negotiations with the UK Government over the timescale of transfer of civil service and agency functions. It should also start now with plans for the establishment of new ministries such as External Affairs, Economic Management, Defence and Energy including service agencies such as a Scottish Central Bank. The priorities should be to fill any gaps left by departing UK agencies in determining locations, spreading the employment benefits and decentralising functions to local government.“

This was said by Roy MacIver formerly General Secretary of COSLA presenting a paper The Location of New Ministries in an Independent Scotland (attached or linked)

Gordon Wilson, Director of Options added:

“We have set out a set of principles which should govern Scottish decisions. Obviously, in preparation for a YES vote and the negotiations with the UK Government that will follow, it is essential that the details and programmes for transfer need to be hammered out. Given our call for decentralisation and a fair geographical spread of civil service employment, enterprising Councils should get ready to put in bids.”

Highlights of the Paper

Principles and Priorities

In seeking to make decisions on location, careful thought should be taken as to how many functions could be stripped from central government and decentralised to local government to perform the executive functions on behalf of the state. This will not just mean reversing the flow of power from locality to the centre as has happened for financial reasons in recent decades but a more radical one of looking at functions carried out by the Scottish Government and seeing if they could be implemented more effectively at local level. Such a review would also need to look at the current structure of local government itself to judge whether it would need to be reformed into larger units to achieve the capability of adopting further powers and duties. This would also allow the dispersal of civil service manpower with benefit to local economies and advantage to employment.

In essence, decisions taken should follow these principles:

1.              Scottish civil service jobs created with independence should compensate for those UK functions no longer needed.

2.              If the Capital is to benefit from the establishment of a new ministry such as External Affairs, then it should be axiomatic to avoid creating another London that there should be transfers of existing Scottish Government functions to other localities with Edinburgh based staff relocating to any new ministry created there or transferring to local government..

3.              The Scottish Government, if it is not already doing so, should prepare a course of action to be considered by the negotiators, and subsequently by the Government elected after independence.

4.              COSLA should commence preparatory work to determine what powers might appropriately and beneficially transferred to local government with a view to inputting their proposals for decentralisation.

5.              Individual local authorities should prepare their bids for Scottish civil service jobs likely to be relocated.

6.              It is accepted that there will be short to medium term benefit for both the Scottish and UK Governments to farm out services to each other to give time for restructuring. These are areas for negotiation and not the subject of this paper which looks primarily at principles and priorities in outlining possible options for a Scottish Government.

Decisions on Location

The range of tasks facing a newly independent Scottish state in the creation of the necessary machinery of government will include the creation of Departments of State in Scotland effectively from scratch.

The most substantial of these will be Economic Management and External Affairs, and the size and structure of these will depend on many political decisions which can only be taken in the post-referendum period.  In the field of Economic Management, such decisions include the currency to be adopted by an independent Scotland, and if that is to be the £Sterling, the nature of the relationship with the rest of the United Kingdom as the sole or dominant partner in the management of that currency, as well as the regulatory regime for banks and other financial institutions whose activities are  spread over both states (and beyond).

In external affairs, the nature and scale of our interrelationships with our nearest neighbour states, including the rest of the United Kingdom, will depend on the approach adopted by them to the terms of the new state’s membership of the European Union (and of NATO) and the number of civil servants required to undertake the diplomatic activity involved in negotiations will vary accordingly.

HM Treasury employs 1,070 staff, excluding various agencies, and the Foreign and Commonwealth office 4,990, excluding those located overseas.  It would not be realistic simply to assume the requirements to be in direct proportion to the population of Scotland within the United Kingdom, but taking a very broad brush approach, a total of at least 1,000 staff might be assumed between the two new departments.

Given the relative preponderance of civil service jobs already located in Edinburgh, it could be argued that newly created departments should be located elsewhere, and if at all possible within one of the areas with relatively low numbers of such jobs.  There are however powerful arguments that these of all the departments and agencies of government should be located at the centre of the machinery of government.  If that argument is to be accepted, it strengthens the presumption that  newly created posts in other departments whose proximity to the centre is less essential should be located in such areas.

In the case of the department to be responsible for welfare payments, there is no apparent requirement for its senior management functions to be located in Edinburgh, and given the likelihood of some reduction in the volume of work being undertaken at Northgate in Glasgow, there would be a case for that as the preferred location, along with the processing of Attendance Allowance claims for those resident in Scotland.

Similar considerations would apply in the case of the successor to HMRC, suggesting a location of East Kilbride.

The decision on the location of the successor to the Ministry of Defence will no doubt be affected by the future shape of a Scottish defence force, and the most substantial locations of its presence.  If those are to reflect a predominant role of protection of Scotland’s most valuable resources, in and around the North Sea, contenders might be Dunfermline and Perth, both with historic roles as centres for military governance.  As suggested earlier, there will be a case for location in or close to West Dumbartonshire to provide alternative employment there.

No reference has yet been made to the Scottish successor body to the Department for Energy and Climate Change. In the paper “A National Plan for Scotland’s Oil and Gas Industry” proposed the establishment of a Scottish Oil and Gas directorate in Aberdeen, and there seems no reason why Aberdeen should not be the location of the Ministry for Energy also, both given the importance of the oil and gas industry to Scotland for the foreseeable future, the presence of many of the major players in the industry there, as well as an opportunity to create civil service jobs in an area where the existing proportion is relatively low.

Options for change in Scotland

The creation of a new state, albeit one founded on a territory which existed as a state for several centuries, and for the last three as a discrete part of a larger state, provides opportunities for considering the nature of government, how much or how little of it there should be, the balance to be struck between the needs and wishes of the majority and the need to recognise and protect the claims of minorities, and how and at what level these conflicts should be resolved.

(i)  More or less government
For better or worse, the creation of a very different form of government, with a different ethos on issues of liberty, equality and fraternity, cannot be achieved overnight.  We are accustomed to a system of government which falls somewhere between the currently fashionable paradigms of the United States on the one hand and the Scandinavian countries on the other, and in the past decade we have been broadly content with a devolution settlement which has allowed decisions to be taken in favour of the retention, re-introduction and extension of universal benefits, and to seek to mitigate the impact of expenditure cuts within the limitations imposed by the overall financial constraints.  It therefore seems unlikely that the government of an independent Scotland will for the foreseeable adventure embark on a policy of significant reductions in public expenditure and services, with concomitant reductions in civil service numbers.

(ii)  Central government or local government
Within the overall level of provision of public services, consideration should be given to the level at which delivery of these services should be affected;  local government has been the main agent for the delivery of the vast majority of public services, and its role remains the dominant one, despite changes that have taken place in recent years which have resulted in centralisation of such services as maintenance of the major road infrastructure, further education and most recently police and fire services. Consideration should be given to whether this centralising approach should be continued or reversed.

One specific set of demands raise these issues clearly, namely the case made by Orkney, Shetland and Western Isles Councils for a greater of control over the delivery of public services in their areas.

(iii)  Do-it-ourselves or farm out
At the opposite end of the spectrum of options for the delivery of services is the continuation, with little or no modification, of the existing arrangements for delivery of services on a UK-wide basis.
The Expert Working Group on Welfare recommended that in the period immediately post-independence the existing arrangements for the delivery of Welfare should be retained on a transitional basis, and presumably the timescale for such a transition would be conditioned by the practical difficulties of establishing a free-standing system on the one hand, and on the other the impracticalities of one organisation operating regimes with different sets of rules.

This last consideration would apply to some extent to other services currently delivered on a UK basis; there are activities such as driver and vehicle licensing where the need for operating two different systems might not arise in the short term, and might still not be unduly problematic when it did arise.  Thus, while there would be a purely political wish to be “doing our own thing”, it might not be seen as a matter of urgency in the early years.

Ends

Roy MacIver was Secretary General of COSLA. Before that he was Chief Executive of Comhairle nan Eilean Siar (Western Isles Council)

Gordon Wilson is Director of Options for Scotland and former Chairman (leader) of the SNP.

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