Guy Stenhouse: Best beware of strutting politicians and their empires

Politicians have a bad habit of thinking they create jobs; they don’t, they destroy them.

Remember the gallus Derek Mackay, strutting around Ferguson Marine like a benevolent superhero who had saved all the jobs there and would ensure a successful nationalised business would create more?

In fact he was just splashing our cash. The ferry fiasco drags on and the long-term viability of Ferguson Marine remains entirely unclear.

More recently Nicola Sturgeon announced that Social Security Scotland will employ an additional 2,000 people over the next 12 months – on its way to a total of 3,500 – many more than we were originally advised would be needed. A cause for celebration we are told.

Leave aside the point that the new Scottish Benefit Agency jobs could have been created in Stornoway, Stranraer and Dunoon rather than Dundee.

Focus instead on why we are supposed to be pleased it will require more resources to do the job than was previously thought and on the money it will cost.

The Scottish Government doesn’t want to talk about cost – instead we are assured it will create a strangely precise financial benefit to Scotland of £208 million.

How this figure is calculated and over what timescale it will happen is unclear but once again the Scottish Government confuses spending taxpayers’ money with benefit to the nation.

In reality it is the private sector not the public which creates wealth and jobs, pays taxes and enables public services to be funded.

Every job the Government “creates” is paid for either by those nice English taxpayers or by taxpayers in Scotland.

Those secure jobs at the Scottish Benefits Agency with their Living Wage pay, generous annual leave (code for holiday) and good pensions represent a cost burden placed on the productive economy.

You can see the jobs the Scottish Government creates – not least because the government keeps pointing at them – but you don’t see the larger but less-visible adverse effect on the dynamism and job-creating ability of the wider economy which paying for them causes.

The Scottish Government should celebrate requiring fewer administrative jobs than it expected would be needed to deliver public services, not more.

Linked to this distortion is a tendency to build inefficient and bloated bureaucracies to do a job for the whole of Scotland rather than support nimble and effective local operations.

I am sure some consultant will have produced a report showing how much more efficient on paper it would be to create a single Scottish Police Force.

The reality has been very different. There are not more police on our streets, crimes you report are not more likely to be investigated, getting through on the phone to the police is harder not easier.

The social care sector is another which has come on to the Scottish Government’s empire – building radar.

Instead of recognising that local councils should be given more resources and allowed to enhance social care services in a way which best suits their local community, we must apparently build a national care service.

More scope for highly paid pen-pushers in big cities and a hollowing out of local capability is the likely result.

The Scottish Government likes gathering power to itself, not just from Westminster but increasingly also from local authorities and it seems to love creating bureaucracies in the central belt.

This sort of behaviour is a bad habit of most governments but the SNP Government is often starting from scratch and should do better.

Guy Stenhouse is a Scottish financial sector veteran who wrote formerly as Pinstripe

The Herald Scotland

The Herald Scotland

The Herald is a Scottish broadsheet newspaper founded in 1783. The Herald is the longest running national newspaper in the world and is the eighth oldest daily paper in the world. The title was simplified from The Glasgow Herald in 1992