Gary Elliot: Why Yes needs to get smarter about dealing with GERS

CommonSpace columnist Gary Elliot says the Yes side during an indyref 2 campaign must consider how best to build public trust in alternative economic arguments

I’M going to start off by saying that I have a large degree of sympathy with the view that GERS figures don’t fully represent what the fiscal position of an independent Scotland would be. 

Even a cursory reading of the report raises so many questions that you can’t help but be left thinking, "what is Scotland’s true fiscal position?".

However, this doesn’t mean that I think these questions create some get-out-of-jail-free card for the next Yes campaign. Whether or not you agree with GERS, disagree with GERS or want to just try and ignore it, the fact is – no matter how unpalatable it might be for Yes campaigners - that the next No campaign will use whatever GERS figures are produced over the next couple of years as a big stick to beat Yes with.

No matter how unpalatable it might be for Yes campaigners - that the next No campaign will use whatever GERS figures are produced over the next couple of years as a big stick to beat Yes with.

The next Yes campaign therefore has a choice. It can either point at the GERS figures and keep saying "don’t believe those, they don’t relate to the fiscal position of an independent Scotland", or it can produce a detailed deficit reduction report, outlining the changes to tax and spending that are planned in order to reduce Scotland’s deficit down to a level considered "sustainable" (e.g. the guide figure for Eurozone members is three per cent of GDP, although it needs to be stressed that not all Eurozone members achieve that every year).

Of those two choices, in my opinion, the only credible choice that can be made is to produce a robust and detailed deficit reduction plan that can outline to voters how the transition from a union state with fiscal transfers to sustainable fiscal independence can be achieved. 

In my opinion, if we campaign on the basis of 'GERS are rubbish, don’t beleieve them', this would be a major mistake and would repel voters. Quite frankly, Yes would be as well to pack George Square with 10,000 people holding placards saying, "We are not credible people, don’t vote for us".

I’m of the belief that creating such a plan is realistic and achieveable. I also believe that there are political and economic choices available in terms of what could be done that go far beyond 'raise taxes or cut services'. 

However, again in my opinion, producing a credible and robust deficit reduction plan is not, on it’s own, enough. One of the major things that we need to do if there is going to be an indyref 2 is learn from indyref 1 and this relates not only to both the strengths and weaknesses of the Yes campaign but also both the attitudes and behaviours of the No campaign and the points of learning that they have made public about their own campaign.

In my opinion, if we campaign on the basis of 'GERS are rubbish, don’t beleieve them', this would be a major mistake and would repel voters.

So, among others, there are two things that we know that Better Together staff have admitted publicly since 2014. Firstly, there has been an admission that one of the reasons that Better Together was so negative was becuse in focus groups they found that any admission that an independent Scotland was in any way financially viable swayed people towards Yes.

Secondly, we know that they had planned, since well before it was produced and released, to scathingly attack the White Paper and denounce it as a "work of fiction" no matter what it’s contents were.

Do we really expect that the next No campaign will be any less shrill and negative than the last one? If current mainstream and social media attitudes and output are anything to go by, if anything we can expect it to be even more negative to the point of shrieking hysteria.

So, a significant risk for Yes 2 is that no matter how credible or robust a plan is produced, and no matter whether it is produced by Yes mk2, Common Weal, the SNP’s Growth Commission or whoever, Better Together mk2 will repeat the same tactics and rubbish the plan from day one, safe in the knowledge that this will be happily amplified through a compliant pro-union press.

Quite frankly, Yes would be as well to pack George Square with 10,000 people holding placards saying, "We are not credible people, don’t vote for us".

In moving forward, then, as far as I am concerned, the rebuttal strategy to this needs to be built into the process from the very start. How should this be done? In my opinion, it’s not good enough that this type of fiscal plan is produced solely by independence-leaning organisations and/or campaigners. 

In order to both build in legitimacy of content and presentational credibility there needs to be some input from the type of third party institutions that the media love to call "well respected" and "renowned".

In practical terms, I would suspect that this would require either co-authorship or peer review. Not only would this help ensure that the detail and figures within the plan were as robust as possible, it would provide instant rebuttal to entirely predictable No campaign attacks.

For example:-

No: 'This is a work of fiction, don’t believe Nat stats!'

In moving forward, then, as far as I am concerned, the rebuttal strategy to this needs to be built into the process from the very start.

Yes: 'This was peer-reviewed by the Institute of Fiscal Studies, which described the plan as robust and credible.'

I’m not suggesting that this approach would be absolutely bullet proof, as any rebuttal (and required soundbite) would need incessantly hammered on an ongoing basis. It still needs to be done, though, or else any work authored could end up being buried under a flood of hysterical dismissal.

It’s also worth bearing in mind that the 2014 sterling union plan was authored by eminent economists but was still subject to high levels of attack. The difference here, though, was that there were two major weaknesses that really undermined that case. 

Firstly, the currency union required the agreement of the UK Government, and when it refused this it put major doubt upon the plan. Secondly, the emphasis by Better Together on a currency plan B – and the refusal by Yes to name which of the three it would be – led to further doubt. By that point, who had authored the plan was largely irrelevant.

The other thing that needs to be taken account of is how oil revenues are factored into the equation. As they are now minimal, my thought is that these should be excluded totally from any deficict reduction plan. 

In order to both build in legitimacy of content and presentational credibility there needs to be some input from the type of third party institutions that the media love to call "well respected" and "renowned".

This means that Yes wouldn’t be tempted to use any projections from future growth as part of public spending and it blunts any criticism that the fiscal position is being predicated on a 'volatile' resource. 

Take it out of the equation altogether and if revenues do increase then put them straight into the oil fund that we should have had all along.

Do this and it really would be a bonus.

If you’re interested in the economics of an independent Scotland, Yes Rutherglen is holding an event this evening, chaired by CommonSpace editor Angela Haggerty. All welcome.

Picture courtesy of Ken Teegardin

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