Common Weal

May this be the last Oil War

/ Dr Craig Dalzell / Leave a comment

“I’m going to say [to George W Bush], ‘And you tell me, what the noble cause is that my son died for.’ And if he even starts to say ‘freedom and democracy,’ I’m going to say, ‘bullshit.’ You tell me the truth. You tell me that my son died for oil. You tell me that my son died to make your friends rich. You tell me my son died so you can spread the cancer of Pax America, imperialism, in the Middle East” – Cindy Sheehan, (2005, Voices of a People’s History of the US)

This blog post previously appeared in Common Weal’s weekly magazine. Sign up to our Daily Briefing and Weekly Magazine newsletters here.

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sunset

For decades now – almost since the first barrel of oil was pulled out of the ground – the oil companies have been paying people to tell environmentalists that the world couldn’t possibly shut down the fossil fuel sector, especially not overnight! Furthermore, rather than spending those decades slowly ramping down fossil fuel dependency in favour of alternatives, we were told that we should just “Drill, Baby, Drill” and pump more black stuff into our consumer goods and into our atmosphere for the great profit of the oil barons. There will be parties in the upcoming Scottish elections who will be openly campaigning on this stance.

Well, thanks to those efforts and the efforts of some powerful men with apparent grudges against the future, we now live in a world where the fossil fuel sector can be shut off overnight.

The closure of the Hormuz Strait as a result of the US and Israel’s illegal war against Iran is causing shocks throughout an energy sector still not made resilient against the shocks of Russia’s illegal war against Ukraine.

The closure of the Strait has spiked oil prices by around a factor of two, actual shortages are being felt in some countries that are reliant on the oil directly from the region (as opposed to places like the UK and US where oil supplies are less affected other than by the price shock and we merely need to compete on price in what is a globalised commodity market) which has caused countries to experience blackouts or to partially shut down their economies to reduce energy demand.

The world has been here before with a conflict between the US and Iran which led to the closure of the Strait of Hormuz! The world should not allow this to happen again.

One of the biggest differences between the present conflict and the previous oil shock of the 1970s is that we are far better placed to have avoided it should we have chosen to. Renewables technologies have come a long way since US President Jimmy Carter put some solar thermal panels on the roof of the White House as a symbolic show of his support for weaning America off of oil (the panels were removed by President Reagan in a symbolic move of his reversal of said policies though they eventually lived on till the end of their useful lifespans in other locations or have since been placed in museums).

The cost of wind energy has dropped by 90% since the 1970s and solar energy costs have dropped by closer to 99.9% since then. It’s now possible to buy rooftop-grade solar panel for less than £50 each and with the UK about to make it easier than ever to literally plug them into their home sockets we’re about to see a hard takeoff in adoption here in the same way that it is already rolling out in Germany and many other countries. Solar electricity is now the cheapest form of energy generation humans have ever created, and we probably haven’t hit the price floor yet.

Continue reading →

A regulated economy is one that works for all of us

/ Dr Craig Dalzell / Leave a comment

“They’ll re-regulate within ten years. There’ll be a string of crashes, and they’ll do it. the free marketeers will scream, but the fact is, free markets don’t provide safety. Only regulation does that. You want safe food, you better have inspectors. You want safe water, you better have an EPA. You want a safe stock market, you better have an SEC. And you want safe airlines, you better regulate them too. Believe me, they will.” – Michael Crichton

This blog post previously appeared in Common Weal’s weekly magazine. Sign up to our Daily Briefing and Weekly Magazine newsletters here.

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It was a sombre weekend for me last week. The fire at Union Street in Glasgow hit me hard. I know it was by far not the worst disaster happening even at that moment – as Trump and Netanyahu’s illegal war spread burning oil rains over Tehran in a manner that would surely be an example of a prosecutable offence under the proposed Scottish Ecocide Bill on top of war crimes and crimes against humanity.

But still, that corner of Union Street was Common Weal’s office for several years and I realised that I’m the only member of the team remaining who worked in it on a daily basis (Robin had always habitually worked from home even before the Covid pandemic pushed the rest of us to do it too) and so the pang of personal connection was particularly strong.

As one of our Daily Briefings said this week, there are a lot of questions to be asked about the cause of the fire and many that may never be answered. If early reports are accurate though, it may well be that the vape shop where it started was not properly following business regulations and, simultaneously, the regulations around shops that sell highly addictive and highly flammable substances like vapes is nowhere near strong enough given the risks that the devices pose.

(By the way, if you are subscribed to Common Weal’s weekly Magazine but not yet subscribed to our Daily Briefing newsletter then you’re missing out. Every weekday we’ll send you our take on a news story that caught our eye that morning – one that you may not have noticed or may not have clocked the particular significance of from a Common Weal focus. Subscribe to the Daily Briefings for free here. And if you like it, please consider sending us a wee donation to help us keep it going.)

There are going to be questions in the coming weeks, months and possibly as part of the upcoming Scottish Parliamentary elections about how to better regulate these shops specifically. Even the Reform Party is calling for a review of regulations and they have usually been a party ideologically wedded to the idea that “cutting red tape” is the way to boost the economy.

And this is perhaps the core of the issue. The call for more or fewer regulations in anything from businesses, through banking, to regulations over cross-border food imports and exports, or even the regulation of government itself, appears to run like a swinging pendulum. When things are going fine, people think that the regulations are holding them back and call for the red tape to be cut. We become complacent and perhaps forget that the problems the regulations prevent ever even existed – almost like living in a world where people call for cuts to the fire service because it’s been years since they saw a building burn down.

When things crash (as they so, so often do) people wonder why the regulations didn’t save them and want more to prevent the causes of the previous crash happening again. This works until a different crash blindsides everyone who wasn’t listening to the folk who were warning about it, or folk start to feel safe and start talking about cutting red tape again.

There’s another aspect of regulation that sits underneath that broad cycle of tying up and cutting the red tape and that’s our willingness to enforce the regulations that do exist. This, too, could run from vape shops not being checked to make sure they are registered out to ensuring that the food being imported into the country are actually being checked to make sure they are meeting agreed standards rather than just being ‘waved through’ because there just aren’t the resources there to properly secure the border.

A regulation that isn’t enforced is even worse than one that doesn’t exist because it’s often not never enforced but instead merely enforced selectively. Which means enforced for us, but not those with the money or the power or the “too big to fail” scale to avoid having to play by trivialities like “the rules”.

“We can no longer allow the failure to regulate to simply be priced into the cost of doing business.”

Common Weal has been working on a broad group of policies around the topic of governance – mostly focus at Government itself but this all applies everywhere too. One of the foundational principles is that “no-one should govern themselves”. This means that government isn’t allowed to vote against transparency measures under the excuse that the mandatory rules merely replicate voluntary rules that they’re not following.

It means that the boards that are supposed to govern our regulatory bodies can’t be solely conscripted from the ranks of the bodies they are supposed to be regulating. It means that conflicts of interest must be rooted out and it means that lobbyists who advocate for changes to or immunity from regulations must do so in plain site of our democracy – we now argue that the Lobbying Register is insufficient and that ALL lobbying meetings with the Government (even ours) should be recorded and posted for public scrutiny.

And when it comes to regulation of the private sector, we can no longer allow the failure to regulate to simply be priced into the cost of doing business. There needs to be adequate deterrent and punishment for those responsible for failure that doesn’t just take the form of a fine that is smaller than the cleanup costs. That way lies the principle of CATNAP – Cheapest Available Technology, Narrowly Avoiding Prosecution – where companies don’t even just barely meet what regulations there are but happily sell us illegal products from unsafe vapes to unsafe houses knowing that no-one is about to stop them from doing so.

It’s said that “every rule is written in blood” and this is very much true when it comes to regulatory practices and especially with health and safety. Those who break out the scissors must be able to articulate why those rules came about and what they were designed to protect us from before being allowed to start cutting or even to just stop enforcing what we have – especially in the name of profit.

Otherwise, when the pendulum swings again, the blood that the next set of rules will be written in might well be our own.

 

Process over policy was never a route to Indy

/ Dr Craig Dalzell / 1 Comment

“Il nous faut de l’audace, encore de l’audace, toujours de l’audace!” – Georges Jacques Danton

This blog post previously appeared in Common Weal’s weekly magazine. Sign up to our Daily Briefing and Weekly Magazine newsletters here.

If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

The Scottish Parliament’s Constitution Committee has recently concluded a short investigation into legal mechanisms for triggering a second independence referendum. The final report and the reports of the evidence sessions are worth reading, but the conclusions are fairly simple albeit in a direction that probably won’t please anyone who has an especially vested interest in the process for Scottish independence.

Essentially, the principle of becoming independent is itself legal (as opposed to many states which have constitutions that explicitly prohibit the secession of components of the state) but there is currently no legal mechanism in place that would allow for Scotland either to unilaterally declare independence nor to unilaterally hold a public referendum (even an “advisory” one) on the question of Scottish independence. This stands in contrast with various other states which explicitly legislate to allow components to secede either unilaterally or provide a mechanism to translate the democratic will of their residents into the legislative process of independence.

Instead, the processes which would allow for independence cannot be enacted unilaterally and may only be enacted via the UK Government or UK Parliament. This includes a mechanism similar to the one in place for Northern Ireland which would allow for a poll on leaving the UK and reunifying with Ireland if public sentiment makes it seem likely to the UK Secretary of State for Northern Ireland that such a poll would return a result for reunification. That’s a slightly technical wording but the crucial point is that public polls in favour of reunification are only a mandate for a referendum if the UK Government chooses to not be wilfully blind to them – the veto is still in their hands.

As is the legislative process of becoming independent – that can’t be done by the Scottish Parliament passing a ‘Divorce Act’, but instead by Westminster passing legislation to enact independence. The obvious route to my mind is that they would amend the Scotland Act to delete Schedule 5 and so remove the list of reserved powers – essentially devolving everything not already devolved.

Then it might add Scotland to the Statute of Westminster 1931 which essentially says that new UK laws won’t apply to Dominions and the Commonwealth nations unless they explicitly request or consent to it. Only then could this be followed by a Scottish Act or Constitution Article to make it unlawful to request or consent to such laws plus further laws to remove the role of the UK Supreme Court and other state apparatus that may remain plus something to clarify questions around Crown succession or to remove the Magic Hat entirely and become a Republic.

Another crucial conclusion is that there is no international law that can be applied to legislatively compel Westminster to act on public sentiment or on the calls for a referendum. The UN isn’t going to send in blue-helmeted peacekeepers to enforce some hypothetical ‘Decolonialisation Mandate’ or something like that.

Instead, the Committee concludes, that the question of independence was less a legislative question but more a diplomatic and democratic one. Essentially, that independence could be legislated for should it need to be, but this is only going to happen in practice when the UK Government decides that it needs to be.

Here’s the thing – This was also pretty much exactly the thought process that went in to us writing our books Direction in 2023 and our policy paper Within Our Grasp in 2019. It’s important to note that the latter paper was written before the Supreme Court ruled that a unilateral advisory referendum would be unlawful – a decision that at the time seemed likely but far from assured and therefore until that moment was ambiguous.

“Our goal should be to set up the situation where Westminster has absolutely no choice but to come to the negotiating table to enable independence because not doing so would be worse for them.”

We recognised long before this Committee was even conceived that the question of independence was going to be more about democracy and diplomacy than sheer legislation and we’ve taken quite some flak over the years from trying to push back against elements of the independence campaign who tried to magic independence into being by finding ‘one weird trick the lawyers won’t tell you about’ that would somehow invalidate the Act of Union and prove that Scotland had, in fact, been independent all along. I remember with wry fondness one person who reacted to my explainer of the legislative process above by calling me a “Colonialist Westminster Shill”.

Wishing independence into being isn’t going to make it happen, but the lack of a clear legislative process with goalposts and milestones isn’t a weakness either. Goodhart’s Law very much applies here in that some process that demands that, for example, public polls show 60%+ support for a sustained period of six months before a referendum can be considered could always be knocked into the long grass by a single 59% poll or – perhaps worse – could bounce us into campaign mode without a plan for the day after (like Brexit). Even the SNP’s foolish target of calling for a referendum if there’s an SNP majority in May grants the UK Government the ability to decline that offer even if every single MSP in Holyrood is openly pro-indy, but only 63 of them are SNP.

Instead we should recognise that the precise legislative formulation for independence is ultimately irrelevant. If Westminster has the ultimate veto over whether or not it goes ahead, then we must recognise that they will always enact that veto if doing so causes them fewer problems than not doing so. This is why Sturgeon’s 2017 demand for a referendum was dismissed with a curt “now is not the time” and every other attempt with even less.

This was the purpose of our book and policy paper. Our goal should be to set up the situation where Westminster has absolutely no choice but to come to the negotiating table to enable independence because not doing so would be worse for them. I’ll leave the details of that strategy behind the links to the book and paper (please go read them and buy the book) other than to say that only one component of it is building the public support for independence to undeniable levels.

We also need to consider building an escalating pressure campaign whereby Westminster essentially realises that governing a Scotland that no longer wants to be governed is more hassle than it’s worth (which, if the propaganda is true, is already not worth much because we’re such a money sink).

We weren’t invited to give evidence to the Committee, despite the detailed work we’ve done on the topic, but if we had been we may have questioned the reason for the inquiry being called. Its conclusion was obvious to us long before it was even started and so should have been obvious to the people who called it. I fear that the inquiry was never designed to be part of a coordinated ladder of escalating pressure but was instead another attempt at substituting process for policy.

There’s a simple test of whether I’m right or not. One that will separate a checkbox exercise designed to let the parties tell potential voters they’re doing something from one where they are actually doing something to bring about independence.

The Committee’s final conclusion calls for the Scottish Government and UK Government to negotiate a pathway to exercising Scotland’s right to determine its constitutional future as a matter of urgency.

The test is this: What will you, the politicians, do when (not if) Westminster once again says ‘No’?

It’s a lack of will, not consensus, that prevents Council Tax reform

/ Dr Craig Dalzell / Leave a comment

“We need an assembly, not for cleverness, but for setting things straight.” – William Golding

This blog post previously appeared in Common Weal’s weekly magazine. Sign up for our newsletters here.

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The Joseph Rowntree Foundation has published a significant intervention into the upcoming Scottish election, saying that the next Parliament must stop cringing away from reforming Council Tax.

The Scottish Government’s current position is that they can’t make that change because there’s no political consensus for what comes next. This is a disingenuous take, given the chances they’ve squandered or deliberately suppressed in order to manufacture that situation.

Everyone, even the Scottish Government, agrees that the Council Tax is fatally broken. No other tax is based on valuations that were set a third of a century ago (imagine suggesting that your income tax should be based on what your salary was in 1991). No other tax so badly misvalues so many houses (imagine there was a 50:50 chance that your income tax code wasn’t even based on the job your doing right now). Almost not other tax gives such a high tax break to so few at the expense of so many. It absolutely must change and should have changed 30 years ago.

There have been several alternatives to the Council Tax that have been mooted over the years. Some have been better than others. But to my mind at this point there really are only two possible positions in the debate.

On one side, there are those who advocate for a fair and proportionate Property Tax that applies the tax based on a percentage of the present value of a home. Our own proposal to this effect models – for the purposes of making the argument – a flat percentage rate across all homes but there’s absolutely no reason why that rate can’t be varied by Local Authorities, surcharges for multiple ownership or even, as our friends at Future Economy Scotland have mooted this week, why there couldn’t be a progressive element for very high value homes.

The key point to this though is that if your neighbour who differs from you only in that they own a house that costs ten times as much as yours does, then it is fair and just that they pay ten times as much Property Tax than you do.

On the other side of the argument there is everyone else – who, regardless of what they are putting forward in terms of a reform plan – fundamentally believe that the top 10% of property owners in Scotland should have their lifestyles subsidised by the rest of us – even those of us who are going increasingly into debt just trying to keep a roof over our heads.

That sounds harsh, but let me explain.

If you believe in a banded Council Tax similar to the current one or perhaps modified by the proposals in the recent Scottish Government consultation (or their plan for a mansion tax that came out of nowhere while that consultation was still live) then houses in the top band will always and by definition win a tax cut. Even under the “mansion tax” proposal, a £20 million house will pay the same Council Tax as a £2 million house. This is not fair.

Under our proportionate Property Tax and even under its nation-wide flat rate of 0.63% (or £630 per year on a £100,000 house) we found that despite bringing in the same amount of total revenue, almost everyone whose house cost less than £400,000 would get a tax cut. The same would also be true if any of the Government’s consultation options were adopted and then we decided to move to out Property Tax later. The banded system simply doesn’t work and ALWAYS leads to a subsidy for the rich.

The same is also true for replacing Council Tax with an income tax (a position the SNP had in 2007 and some other parties still have). Wealth inequality is far higher than income inequality and property speculation is itself a major driver of that wealth inequality. Failing to tax wealth would release the brakes even further on property speculation and allow those who bought houses when they were cheap to profit even more when they sell them (The myth of the aged widow with no income living alone in their mansion with no-where else to go is largely that and would be better solved with individual discounts or exemptions and providing more appropriate housing they could move to).

But if, after that, the political parties still can’t agree to reform Council Tax in the only way they should then they should have stopped being the problem. In the run up to the 2021 election, the SNP made a manifesto promise to hold a Citizens Assembly on local tax reform, including Council Tax reform. They failed to deliver on that promise. That Assembly could have created the consensus that Robison is using as a shield against inaction – which is probably why they failed to deliver.

As I point out when I wrote about this last time, the major weakness of the idea of a Citizens Assembly is that politicians fundamentally don’t want them to work. For them to work, the politician has to step out of the way. They have to accept that the Assembly is happening because they weren’t able to do their job. They have to give the power to make the decision to the citizens who form the assembly and then they have to agree – ahead of time and not just if the final answer suits them – to carry out the instructions given to them by the Assembly.

If Shona Robison or her successor wishes to claim that the reason they can’t reform Council Tax is because of a lack of consensus then it is incumbent on them to create that consensus. If they can’t do it themselves, then they need to accept that they are part of the cause of that lack of consensus and should step out of the way.

The debate on Council Tax reform has gone on far too long. Everyone agrees that things need to change. No-one, it appears, wants to be the one to take the responsibility of making that change happen. This isn’t good enough. I’ll be watching the party manifestos closely in the coming weeks. If any of my local candidates can’t tell me what their party is going to do about this failure of responsibility that leads to 90% of people in Scotland effectively subsidising the top 10%, then I’m going to have to ask them who I should vote for instead of them.

What is the point of a party manifesto these days?

/ Dr Craig Dalzell / Leave a comment

“To win the people, always cook them some savoury that pleases them.” – Aristophanes

This blog post previously appeared in Common Weal’s weekly magazine. Sign up for our newsletters here.

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human hand forming heart shape

Election time is almost upon us in Scotland and we’re already starting to see the various parties start to make their pitches to voters. Even though the official “campaign period” hasn’t yet started various parties – including the party of Government – have already started caveating their promises with “if we are elected”.

Some of this is certainly for the good, such as news that if the SNP are re-elected then they’ve promised to adopt Common Weal’s plan for a National Housing Agency. We’re already gearing up to hold their feet to the fire on that one and to try to ensure that they don’t water our plans down to homeopathic levels as they did with the Scottish National Investment Bank nor that they mess the thing up so badly that it ends up like the National Care Service.

Promises are just words though and we’re entering an electoral campaign where it feels like those words are going to mean less and less to fewer and fewer people. The electorate has fragmented into camps with very little crossover. Politicians are focusing more tightly on the little crossover that does occur. Advertising becomes ever more focused and targeted (to the point that I might be explicitly excluded by the online algorithms from seeing the advert that you have been targeted to see). And we have new threats rising in the form of AI that will mindlessly lie to you by design.

Amid all of that, it might be worth asking what is the point of a mainstay of election campaigning for decades now: the party election manifesto?

Every election, parties are expected to produce a document outlining their plans, priorities and policies should they get into office post-election or even should they merely get into Parliament and be in a position to influence government policy.

It’s important to note that these are not legally required documents nor are they binding contracts. The state of UK electoral law is that, barring very, very narrow circumstances, there is no requirement for a prospective politician to even tell you, the voter, the truth about their intentions in office. The only real legal requirement is that they do not misrepresent the character of themselves or another candidate for political gain (in 2015, Alistair Carmichael won a court case over his lying during an election campaign on the grounds that he never represented himself to voters as an honest person – perhaps this is a question to ask candidates in your next hustings).

And so in a similar vein, there’s no actual legal recourse if a party of Government starts throwing out the promises they made in order to win power – just look at the manifesto of Keir Starmer’s leadership campaign compared to what he’s actually done in office…

Party Manifestos can be tricky to track down sometimes. Over the last few elections, I’ve tried to collect them on this blog but as you’ll see if you try to download some of them on the most recent list, the parties often chuck them in the digital bin shortly after the election which means if you want to track down historical copies, it can mean having to trawl through digital archives like the Wayback Machine.

“Some manifestos have even been held back until after the first postal votes have been cast…This should be ethically unacceptable”

What they are though is a statement of intent, a business plan and a means of accountability. Just because we don’t have some kind of legal redress mechanism if politicians fail to live up to their policies, we do have a social means of redress. The largest is, of course, the election itself as parties can and should be judged not just on the manifesto they put forward to voters but the ones they put forward prior to this. They can and should be judged based on their previous performance on promises fulfilled and promises broken, especially if their excuses for the latter are lacking.

Another aspect of the importance of a manifesto is open transparency. It’s not enough for you, a party loyalist, to see what the party you’re loyal to is promising you. Everyone else has to be able to see it too. We live now in an area where political ideological bubbles can be digitally enforced.

You could well be on a list to be targeted by a political advert from some party or another. It might well be that I am on a list to not be targeted by that same advert. This means that if we meet and start discussing the politics that we’ve seen that week, we could be facing entirely different realities of what we think is important or not.

This problem is made even worse with the rise of AI and other forms of fake news and radicalising politics (see, for example, the trend of people putting out fake news about rising lawlessness in London specifically because they were being rewarded in advertising money for doing so).

By giving people some level of an equal baseline in terms of our political understanding then we can become more and better engaged with the politics and politicians courting our votes (especially when they are the ones lying to us). See Bill Johnston’s recent article on informed citizens here for more about how you can become a more deliberative democrat.

We don’t yet know when the party manifestos for the upcoming Scottish election will be published. There has been a somewhat disturbing trend in recent elections where the larger parties especially seem to be trying to be the last to publish their manifesto – possibly in an attempt to avoid scrutiny and accountability and possibly so that they can make last minute edits to outbid their rivals (or avoid a pitfall that their rivals have fallen into).

Some manifestos have even been held back until after the first postal votes have been cast which should be a major alarm sign for our democracy as this means that it’s possible that parties may not be solidifying their promises until after people have started casting their votes. This should be ethically unacceptable.

As the Scottish election campaign lands on us over the next 11 weeks, I’ll be once again collecting as many of the manifestos as I can so that they can be read in one place. I also plan to follow this article up specifically with a look at some of the major party manifestos to see what they actually managed to accomplish over this current Parliament compared to what they promised to do.

This isn’t just an exercise in helping you vote better (though it’ll certainly do that) but when politicians know that we can see right through them maybe they’ll stop acting like they have something to hide. And maybe then, we’ll start to see a few more of those promises actually turn into policy.

The new National Housing Agency must serve people, not profit

/ Dr Craig Dalzell / Leave a comment

“The Master said, “If your conduct is determined solely by considerations of profit you will arouse great resentment.” – Confucius

This blog post previously appeared in The National as part of Common Weal’s In Common newsletter.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

Common Weal has been campaigning for the best part of a decade on overhauling and improving the Scottish housing sector. While we haven’t been named in the announcements, the SNP’s new proposal to launch a National Housing Agency should they return to Government after the elections is a policy taken straight out of our strategic roadmap which called for what we termed a Scottish National Housing Company.

It is far too easy for Governments to talk big about housing but to do little. Even in previous election campaigns, it has been considered sufficient for a political party to just look at the raw number of houses being built in Scotland and to either say that they would build X thousand homes (where X is a larger number than their rival party is promising to build, or that the previous government actually built) without paying much attention to other vital factors such as where the houses are built, what standards they are built to, how much they’ll cost, what kind of tenure will be offered to residents or who will profit from the construction of the buildings (particularly if policies come with significant amounts of public money attached). This number goes up and down with the political winds but rarely is it based on anything other than that kind of political party promise. It’s almost certainly never based on whether or not that number of houses is ‘enough’ to satisfy immediate and long term demand.

In these respects, the Government has been taking some welcome steps particularly with policies around rent controls and energy efficiency standards (though we still have significant disagreements around how far those proposals should go – the current rent control plan all-but guarantees above inflation rent increases and the energy efficiency standards appear to be being significantly watered down from the “PassivHaus equivalent for all new homes” originally promised).

But a more strategic approach to housing is still needed beyond piecemeal interventions and broad frameworks so in this respect, that the Government has adopted our Housing Agency is something to be celebrated.

The devil is in the details however and Common Weal is now gearing up to develop our proposals and to try to ensure that the Government adopts them in full.

In our original plan, the Housing Agency would be a direct construction body – public owned and employing the people who actually build our houses.

Direct construction bypasses the biggest limitation of every housing policy that has come before. Private housing developers aren’t in the business of building ‘enough’ houses. A basic rule of economics is that price is determined by supply vs demand. Scarcity results in higher prices. This means that developers can charge higher prices by not building homes as quickly as they could or by “banking” land they own to prevent another developer from buying it and building (see my article in In Common last November which breaks down why this and other factors increases the price of an average UK home by around £67,000).

We also can’t keep building houses purely to chase the highest possible price when it comes to tenures. We’ve heard a lot about “affordable homes” in recent years despite no real definition of what that actually means beyond developers being forced to sell a few homes in each block of houses a little bit cheaper than they otherwise would (even when “a little bit cheaper” is still very much unaffordable for many).

A strategic plan led by a National Housing Agency would not be concerned about quick profits and so could build houses with a longer term view. Housing for social rent especially should be built to a standard that minimises ongoing costs like heating and maintenance thus makes living in the houses cheaper for social tenants. (See my 2020 policy paper Good Houses for All for more details on how that would work).

This would benefit Local Authorities in the long term as once the construction costs of the houses are paid off in 25 or even 50 years time, the ongoing rents will still provide a safe and steady income for decades to come. By contrast, the cheap and flimsy houses being built today are being put up by developers who don’t particularly care if the house outlives its mortgage – if it doesn’t, they’ll happily sell you another one.

This is the important point about the role of a National Housing Agency. It cannot be a mechanism for laundering public money into private developers. It absolutely must be a force that outcompetes or plays a different game from the private developers. It must disrupt the market to the point that people would actively seek out a high quality, efficient and cheap to live in Agency house rather than a private developer “Diddy Box”, especially one being offered at exorbitant private rents because the only people able to actually buy them are private equity funded landlords.

Houses should not be an inflatable capital asset designed to enrich the already wealthy and to suck wealth out of the pockets of everyone else. Houses should, first and foremost, be a home. This is the measure of the ambition that the National Housing Agency should be aiming to achieve. Common Weal is very happy to see this policy enter the politician discussion space. We stand ready to help whichever Government comes out of the elections this year to build the Agency we need so that it can build the homes that all of us deserve.

Approaching 2026 With Hope

/ Dr Craig Dalzell / Leave a comment

“Darkness cannot drive out darkness: only light can do that. Hate cannot drive out hate: only love can do that.” – Martin Luther King Jr.

This blog post previously appeared in Common Weal’s weekly magazine. Sign up for our newsletters here.

If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

My last Common Weal Magazine article was my sum up of Common Weal’s year in policy for 2025. If you haven’t read that, go and recharge your beverage of choice (it’s a long article) and give it a read. I’m sure there were a couple of our successes this year that you’ve missed.

Next year will be one that starts off running. The Scottish elections are scheduled for May and that means for think tanks like us, a lot has to get done – thought perhaps not quite in the way that you might think.

The first couple of months will be busy as the Parliament rapidly runs through its “wash up” period. A feature of our democracy is that if any legislation hasn’t been finished and fully voted on by the time that Parliament shuts down for the election in March then it doesn’t roll over into the next Parliament. It “falls” and has to be started again from scratch. This goes just the same for a relatively inconsequential Member’s Bill as it does for a flagship manifesto promise from the Government, so there’s a lot of pressure from a lot of parties to get things done.

We’ve already seen a couple of bits of legislation that we’re interested in fall by the wayside (the attempt from Mercedes Vilalba to impose a maximum cap on land ownership is still technically a Member’s Bill but when the Government voted down an amendment to the Land Reform Bill that would have incorporated it, that pretty much ended hope of them supporting it as standalone legislation). We’re also still waiting to find out if Katy Clark’s Bill to extend Freedom of Information rights in Scotland will get time to finish its process and we’ll be applying pressure to try to make that happen.

We also see Bills pass and fail in somewhat strange ways. The Bill to specifically criminalise the theft of dogs passed this week – despite existing legislation covering the theft of property more generally both already covering dogs and imposing potentially harsher punishments for doing so, meaning that you could interpret the new legislation as posturing at best and the part-decriminalisation of theft at worst. Even as a cat-lover myself, I can’t help but wonder if this was the best use of limited Parliamentary time.

Meanwhile other Bills with arguably much larger social impacts have been dropped such as plans to accelerate the decarbonisation of home heating (albeit not in the way we’d prefer to see) or plans to cut speed limits on roads which absolutely would have saved lives.

All this is to say that the first couple of months trying to sort out what we can help get done (or help to avoid happening) is going to take up a fair bit of time in the first part of the year.

During the election period itself though, think tanks like ours can be remarkably quiet. Sure, you might see some of us as talking heads and pundits on various commentary outlets or perhaps even on election night itself (not that I’ve been invited yet – though I have done the 10pm-5am stint in a previous election) but in terms of policy and lobbying, all of the manifestos have been written and we have no idea who will and will not have a seat until the count happens.

After that, depending on how shaken up Parliament is, we’ll have our work cut out of us to introduce ourselves to the various new (and returning) Ministers and party spokespeople and to start laying out what we can do given the balance of parties. Who knows. We might well get a progressive alliance of parties looking for fresh ideas. We might get a collection of conservative (small-c) “old guard” who need to be strongly nudged along the way. We might well get a Parliament that is openly hostile to our views and needs to be opposed to prevent them from doing damage to the fabric of Scotland. Whichever way, there’ll certainly be a role for Common Weal and I hope you’ll continue to follow and support us on that journey.

Beyond that we’re going to keep doing what we’ve been doing. Our policy pipeline remains a long one and we have some major work upcoming on inequality, on education, on healthcare reform and on digital security as well as ongoing work from folk like our Care Reform Group and Energy Working Group who have been making real strides in changing legislation and regulation in Scotland and in the UK (for just the latest example, see our mention in the Committee evidence report on the Children’s Care Bill published this week where we’ve been advocating for the Scottish Government to keep its promise to remove profit from such care).

“But that we’re seeing the world darkening as a result of the drawing away from those invisible hands shows how powerful they actually were.”

This year has been a dark one. I’m personally extremely worried about the rise of militarism and the pulling away from the only things that will ever actually prevent wars before they start – the world appears to be collectively abandoning climate action, foreign aid, help for displaced peoples and peaceful diplomacy.

But there’s hope too. It’s hard to see the work that went into preventing a war that was never fought. Or to prevent the famine in which no-one starved. But that we’re seeing the world darkening as a result of the drawing away from those invisible hands shows how powerful they actually were. There’s hope that what is happening can therefore be undone and reversed – perhaps with the appreciation now of what could be.

For the smallest glimmer of that, this week I finished work that I’ve spend the last two years working on alongside SCIAF and Friends of the Earth Scotland in which we drew together a dozen people from across four continents for a consultation on how Scotland can make its Circular Economy strategy more powerful.

We’ll be reporting on that next year too but it was an empowering thing to see Scotland actively reach out to others beyond our borders to ask them how our policies on trade, manufacturing and waste management was affecting them and how we could improve ourselves. One of the attendees openly said that this might be the first time that a Global North Government has done consultation on domestic policy in this way and they hoped that it might become the inspiration for others to follow. I’m thankful to the Scottish Government for taking to our pitch with the enthusiasm that they did and for their support in making it happen.

And I’m grateful to all of our readers and supporters who keep us doing what we’re doing. Common Weal is an unusual think tank. We’re not beholden to a particular political party, or to government funding (while the Scottish Government funded the project I’ve just mentioned, neither I nor Common Weal took a fee or compensation from that pot – not even expenses), and our policy programme isn’t dictated to us by the demands of advertisers or funding bodies.

We’re supported by you and people like you. While this means that our funding is a fraction of what it could be (seriously, the First Minister earns more in a year than Common Weal as a whole does), it gives us the freedom to live our principles. If you’re not already a donor or if you know someone who might like to sign up and start supporting us, then please visit our donate page.

Other than that, my final message of the year is my hope that you all have a peaceful and happy winter break – however you may mark it – and that I’ll be back in the New Year rested, full of cheese and raring to go. I’ll see you there.

How to profit from not-for-profit care

/ Dr Craig Dalzell / 2 Comments

“Just because brokerages disclose a convoluted web of profiteering doesn’t mean it’s appropriate. It just means they are hiding these questionable practices in plain sight with a mountain of compliance language that no one will ever read.” – Christopher Manske

This blog post previously appeared in Common Weal’s weekly magazine. Sign up for our newsletters here.

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I would like you to imagine the following scenario: You are a company owner or shareholder. Like every ‘good’ Capitalist, you want to leverage your assets to make as much money as you can. The issue is that you work in a sector where making a profit has been deemed by the Government to be unacceptable and they have banned you from making one. How do you extract as much as you can?

As a bit of background, this thought experiment stems from the conclusions of our latest policy paper, Why and how the Scottish Government must end private provision of children’s care, which has found that private companies, including ostensibly ‘not-for-profit’ companies, that deliver children’s care services are extracting an average of £28,000 per child per year from care services. This includes an average of £9,000 per child per year from foster care specifically where, in Scotland, it is explicitly illegal to make a profit..

These findings have come off the back of the Scottish Government making a pledge to eliminate profit from children’s care and they themselves have described our findings as “shocking”, though they are sticking by their current action plan to merely “limit” profit in such care. The problem as we see it though is that there are various mechanisms open to companies to allow them to extract money from the system in ways that wouldn’t be counted as ‘profit’.

This is because ‘profit’ has very narrow meaning in this context. It’s just what a company has left over after all of its expenses are subtracted from its income. In a for-profit company, this is often distributed to owners and shareholders as a dividend (see my recent article on the financialisation of housing and why that is costing you an average of £67,000 in extra mortgage payments for an example of this in action).

It would be perfectly possible for the Scottish Government to ban the sharing of such dividends for children’s care services and to legislate that only not-for-profit companies can bid for care contracts. However, this is not enough to prevent people from making money from children’s care. To that end, we’ve concluded in our paper that the only way to avoid profit extraction from children’s care is to bring the whole sector into public ownership.

If we don’t, then we’ll just end up with ‘profit’ being shifted into some of the following means of making money without making a profit.

1. Pay yourself as much as you need

The simplest and easiest way of extracting money now that your company has been banned from giving you a dividend, is to simply pay you more. Whatever the company’s surplus was last year, you can just pay to yourself as a salary. There will be tax implications for this – you’ll be paying income tax instead of Capital Gains tax so, especially in Scotland, the tax on your earnings will be substantially higher than if you were paying yourself a dividend, but that might still be worth it.

We found examples of children’s care companies in Scotland where the Director was being paid almost £350,000 per year – and we’ve found similar examples in other ‘not-for-profit’ care sectors like social work. This is more than twice the annual salary of the Scottish First Minister. Note that these high levels of pay often do not filter down to the front-line care staff who are, in fact, often paid less than their public sector counterparts as well as losing out on benefits and rights such as better conditions or union representation. While it is important to ensure that expenditure matches income to avoid ‘profit’, it’s clear that some expenditures are more worthy than others…

This is one area that might still be an issue if the sector is brought into public ownership – a prominent current example is the dispute over the pay rises granted to Scottish Water executives. However, this is still a better idea than the current system allows for. Partially because the Scottish Water scandal is a scandal precisely because it is public owned.

This means that such pay is democratically accountable and Ministers can be challenged for their oversight and the executive salaries are all public knowledge rather than being hidden or woven through opaque company accounts (in our report we couldn’t track down the executive pay of more than a couple of companies because some simply do not disclose it). Also though, Scottish Water has a near-monopoly on service provision in Scotland because it is public owned. In the care sector it’s not just the Director of one company whose salary is under question but multiple companies all working all across the care sector.

2. Lease yourself to yourself

If your care company is banned from making a profit then you can split that company into two. The ‘not-for-profit’ company that actually provides the care services might be banned from making a profit but the for-profit company that is also owned by you is the one who owns the building that the not-for-profit uses. This company charges a lease to the not-for-profit for the use of the building that just so happens to be high enough to eat their operating surplus.

‘Management Fees’ are another way of making these kinds of transfers from a subsidiary to a parent company and come with the added benefit of not being tied to a physical asset like a building and thus there’s no risk of someone noticing that you’re charging far higher rents than would be expected in the local market.

This is also a common tactic amongst multinational companies who want to shift money into tax havens or ‘tax friendly’ institutions. Coffee company Starbucks is well known for buying its coffee beans via a subsidiary company in Switzerland and charges its UK and other branches just enough for those beans to conveniently make sure that their UK outlets never make a ‘profit’ and thus pay little tax in the UK.

3. Give out a loan, and make them pay it back

One of the touted advantages of being owned by a larger company is that they can bring investment cash your way that wouldn’t otherwise be possible to get. Of course, investments always demand a return and the money your parent company loans to your subsidiary (remember, in this scheme you own both companies) should be paid back… with interest.

Even better, because this is an internal company loan rather than one via a regulated bank, you can charge whatever level of interest that you like and easily tailor the repayments to ensure that the not-for-profit company never makes a profit. If you ever wonder why profitable companies end up completely loaded with debt just a few years after being bought out by a global equity fund, this is very likely what has happened.

4. Receive a loan, and keep it.

It doesn’t need to be the parent company passing debt down, of course. This kind of financial transaction can happen the other way too. If the not-for-profit finds itself with a substantial surplus that it can’t get rid of before tax day, then it can loan that cash to the parent company or its Directors (e.g. you). The difference here is that you don’t charge above market rates for this upwards loan.

Maybe you don’t charge any interest at all. Maybe you don’t even expect the parent company to repay the loan ever. Sure, it’ll appear on the parent company’s books as a debt and that could be a problem in certain circumstances but there’s an easy way to deal with that. Simply wind up the not-for-profit company and the debt can be written off and the parent keeps the cash.

How to avoid profit in children’s care

The Scottish Government’s response to our paper was that the figures involved – £28k profit per child, per year – are “shocking” but also that they are not going to deviate from their paradoxical position that while any profit in children’s care is unacceptable, they are merely going to legislate to “limit” it.

As I hope we’ve seen here, that isn’t going to be enough. Even if the ‘limit’ on companies making a ‘profit’ from children’s care is set to zero, it won’t prevent those companies from extracting money from care or – by dint of paying workers as little as they can get away with – from carers. The only solution we can see is to bring the entire children’s care sector – both residential care and fostering – into public control.

This would, of course, be easier if we had a National Care Service to oversee the whole process but the failure of that Bill this year means we’ll need to take a more roundabout way of doing things. We still support an NCS and want to see it created in the next Parliament but children and carers can’t wait till then when we have opportunities now.

The next stage for our work on this will be to try to work out how much it will cost to bring that care into public ownership. We’re stymied by lack of data in this respect but early figures indicate that it might not be as huge of a problem as some fear – possibly on the scale of tens of millions of pounds rather than hundreds of millions. In this respect, it’s probably not dissimilar to our per capita estimates for nationalising all care in Scotland. After all, once we accept that it’s not acceptable to make a profit from caring for children, why should we treat adults any different?

Post-script – The Scottish Parliament’s report on the consultation on profit in children’s residential care can now be read here.

Covid lessons should have been learned in real time

/ Dr Craig Dalzell / Leave a comment

“A man may plant a tree for a number of reasons. Perhaps he likes trees. Perhaps he wants shelter. Or perhaps he knows that someday he may need the firewood.” – Joanne Harris

This blog post previously appeared in Common Weal’s Daily Briefing newsletter. Sign up for the newsletter here.

If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

A stock photo of vials of Covid-19 vaccines

Common Weal looks at the second report of the UK Covid Inquiry with some frustration. It’s not that we don’t agree with the findings, its that we were reporting on these issues in real time. There is no finding in this report that Common Weal did not raise at the time.

We believe there is a conclusion to be drawn from this; society needs more than a small political class talking to a small community of corporate and public sector leaders in private and a small media class in public. We need national debate to include many more voices and perspectives and for those to be taken seriously.

Let’s look at three of the key findings. First, that we were lax to begin the lockdown and poorly prepared for it when we did. This is something Common Weal identified early. We were warning that we should have moved to lock-down early in March 2020 and had already been raising fears the previous month.

By 16 March 2020 we were utterly bemused at the decision to allow 9,400 people to attend a Lewis Capaldi concert in Aberdeen less than a week before we were in full lockdown. We were issuing almost daily warnings in the week running up to lockdown. And then, when lockdown started, Common Weal warned that the UK Government was making a mess of it and that Scotland’s determination to stick to a ‘four nations’ approach was a mistake.

So when Scotland gradually started to diverge, we warned that it was too little too late. Again, as we approached the end of the first lockdown we warned that nothing like sufficient preparation had been made to suppress the virus once we were (partially) reopened.

But it is perhaps the second main conclusion that is most important here – the failure of testing. The difference between needing one lockdown and needing multiple lockdowns was the extent to which we could suppress the virus in the interim period via a testing regime. The entire first lockdown should have been focussed on developing a comprehensive approach. We warned this at the time.

Yet against all the global public health advice, the official Scottish Government position was that “testing is a distraction”. This was inexplicable and we were so concerned that Common Weal strayed out of our comfort zone to produce a public health policy paper in which we set out a testing regime we thought had the best chance of successfully suppressing Covid.

We published it as Ending Lockdown. The Scottish Government ignored it and so as the second lockdown approached we produced a more detailed version. Eventually a watered-down version of our proposals was belatedly put in place. We continue to believe that there remains a chance that the second lockdown could have been avoided altogether if a more rigorous approach was taken.

It is also worth noting that while Common Weal suggested that an elimination strategy was the only one that had actually worked (in New Zealand), it would take steps the Scottish Government would see as too radical to achieve that – closing roads outside airports, ports and the border and putting ‘testing borders’ in place.

For some reason the then First Minister thought it was possible to start talking about a strategy of elimination without taking any of these measures. That she did anyway certainly justifies the criticism of this stance in the report. It was vainglorious rather than credible.

And that leads to the third main conclusion – that there was a narrow and closed-off leadership approach which harmed policy creation, and that the First Minister spent too much time doing television briefings which should have been shared among other senior figures.

Again, this problem was quite clear at the time and something that we commented on a number of times but was not picked up in wider media debate. This resulted in a failure to scrutinise what was actually happening.

There are other issues we expect the Scottish inquiry to cover, including the cover-up of the first outbreak of Covid which took place in a large corporate hotel and policy of sending Covid-positive patients into care homes. Certainly there is no doubt that in Scotland we did not see the utter chaos and rampant corruption that we saw at Westminster, but this is a low bar.

While this report is welcome, we believe that there remains insufficient scrutiny of the extent to which civic Scotland stopped asking questions and stopped challenging decisions for months on end. Common Weal managed to derive policy positions which are now being vindicated from publicly available source material and we did it at the time. Nothing in the inquiry report published yesterday cannot be found from the content in the links above.

The problem is that the sense of national emergency, the political culture of the Sturgeon court, the legitimate universal fear and uncertainty that the lockdown induced and unhelpful and uninformed social media commentary combined to suspend politics and reduce scrutiny at a point where it was never more needed.

What is the lesson we should really learn from the pandemic? Don’t wait for lessons to be learned, pay attention at the time and ask difficult questions. It leads to better decisions. Then again, we did warn about this in the first week of lockdown…

Covid lessons should have been learned in real time

When banks own housebuilders, house prices go up

/ Dr Craig Dalzell / Leave a comment

“A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.” – Mark Twain

This blog post previously appeared in The National as part of Common Weal’s In Common newsletter.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

The way we build houses in the UK could be costing you an average of almost £67,000. This could be fixed by making housebuilding a public infrastructure project rather than a means for very rich shareholders to transfer your wealth to themselves.

Volume housebuilder Taylor Wimpy released its annual report for 2024 yesterday and the details in it, which look excellent from the viewpoint of a corporate shareholder, reveal much that is broken with the UK’s housing sector.

The first important number in their report is the number of houses completed. Taylor Wimpy is one of the UK’s largest volume housebuilders – likely to be in the top three this year in terms of completed projects – yet built only 10,593 houses in 2024 – a substantial reduction over the previous three years (though they claim to be on track for about 14,000 this year).

The second is their claimed operating pre-tax profit of £416 million. The word “profit” is a very fluid term in the world of corporate accountancy as it’s relatively easy for companies to move money around via “one time charges”, inflated director bonuses or “loans” to subsidiaries or parent companies, so a better number to judge a company like this is the money it granted to its shareholders as a dividend as this represents money extracted from the company and not reinvested in any way (not even in the form of the labour of those hypothetical overpaid directors). The dividend for shareholders in 2024 was £339 million.

This means that the houses built by Taylor Wimpy in 2024 generated a dividend to shareholders of an average of almost exactly £32,000 per house. This is how much lower house prices could have been had the company not been in the business of extracting profits via dividends. Had the company been a not-for-profit business entirely, then its houses could each have been almost £40,000 cheaper.

It gets worse for you, the house-buyer, because it’s very likely that you’d be taking out a mortgage to buy that house and you’ll be required to pay interest to the bank on that loan. £40,000 added to a 25 year mortgage at 4.5% interest will result in you paying back £66,700 over that time. To say again, this isn’t the cost to you for paying for anything to do with the construction of the house itself. This is the cost to you for paying interest on the additional loan you took out to pay for the profits of the company, most of which were paid out as dividends to the company’s shareholders.

And who are those shareholders? Our old friends, US based asset managers BlackRock and Vanguard Group are near the top of the heap, owning about 15% of the company between them. Several of the other owners are banks like HSBC and Barclays. This means that if you have a Barclays mortgage, then part of the interest you are paying on your mortgage is being used to service the loan you took out to pay the dividend they gave to themselves to inflate the price of your house.

If Scotland had a National Housebuilding Company as we’ve advocated for the best part of the last decade, then we could be building houses at as close to not-for-profit as possible and could reinvest any surpluses into other public infrastructure to make the places around our houses and the services we need in our community more resilient.

If we built the houses to the plan proposed in Good Houses for All, then they would be constructed at a far higher quality than the conventional timber frame “diddy boxes” (our Board Director and premier architect Malcolm Fraser’s not-so-affectionate name for them) favoured by the volume development sector and would force remaining private developers to drastically improve the quality of their constructions (doing so wouldn’t even reduce their profits because such buildings are now cost-competitive with the diddy-boxes and then create further savings in terms of energy costs).

“If the whole of the UK brought in a Land Tax equivalent to our suggested baseline value of 0.63%, then Taylor Wimpy would owe an additional £2.14 million per year on its banked land”

A final point to note in their report is the amount of landbanking they do. Landbanks are when a company buys up land but then does not build on it for an extended period of time (or sometimes never, or the land itself becomes a commodity to be traded between companies). The report states that the company currently owns £3.4 billion worth of land spread across 79,000 “short term plots” and 139,000 plots in their “strategic pipeline”. They also purchased more plots last year than their number of completions so the total size of their landbank has increased. Given their completion rate over the past few years, they could stop buying land for around 20 years without risking running out.

Decreasing the supply of land without putting it to the intended use of housebuilding is a major factor not just in inflating the price of land but also actively preventing land from being used for building either by other volume developers, by Local Authorities or even by enterprising self-builders. Scotland should consider bringing in a Land Tax to charge companies for the land they own and should consider an additional surcharge on the land tax to account for vacant or landbanked land (which would encourage developers to build so that they can get the land off their books). If the whole of the UK brought in a Land Tax equivalent to our suggested baseline value of 0.63%, then Taylor Wimpy would owe an additional £21.4 million per year on its banked land – still a small fraction of its overall profits.

The way we build houses in this country is badly broken and has resulted in volume developers constructing cheap, cold, damp houses that are not fit for the purpose of living because the purpose of the houses is to extract wealth and deliver it to shareholders. Until we move to fix that and to end the financialisation of housing, we’ll all keep paying a very real and very substantial price for the roof over our head.