Scotland: SNP plan tax cuts for big business

If the Scottish National Party expected a "Salmond bounce" following the election of Alex Salmond to lead the SNP they have so-far been disappointed.

After a series of election disappointments under John Swinney, which had seen the SNP support consistently ebb away, many activists were hoping for a rapid change in fortunes for the party.

But despite the growing unpopularity of New Labour’s war on Iraq, and their war on the working class at home, the SNP have failed to make significant headway. Latest opinion polls show the nationalists on around 23% for the Westminster elections.

Salmond’s election as leader has, despite his radical populism on issues like Iraq, pensioner poverty and opposition to privatisation, been accompanied by a reinforcement of the pro-business agenda of the SNP.

Their new manifesto commitment is for a reduction in corporation tax from the current 30% to 20% in an independent Scotland. Business rates would also be cut to lower than that of England to encourage business to invest in the Scottish economy.

Salmond, a former economist with the Royal Bank of Scotland, aims to model an independent capitalist Scotland on other small European nations like Ireland, Norway and Denmark who have a higher growth rate.

On that basis he has claimed that Scotland’s growth rate would rise to 4% per annum rather than the 1.9% it has averaged over the last 25 years as part of the UK. Over that time the UK economy as a whole has grown at an annual rate of 3%. This, the SNP claims would create 200,000 jobs, increase the falling Scottish population by 150,000 and increase Scotland’s wealth by £20 billion by 2010.

The SNP have also called for the creation of an "oil fund" for Scotland based on the Norwegian model. The Norwegian government has invested a portion of oil revenues into a fund for "future generations." But on the basis of the free-market economy that the SNP leadership worship even these modest improvements will be a mirage.


Even in Norway the relatively better living standards of the working class are under attack. The "social-democratic" model has broken down to be increasingly replaced by neo-liberal policies leading to cuts in welfare spending and privatisation in Norway and across the Scandinavian countries.

In Ireland the "Celtic Tiger" has given way to falling growth rates compared to the 1990’s, a reversal of multinational investment into Ireland, and a crisis in healthcare and housing. It has also left a legacy of massive inequality in Irish society and a government determined to make the working class pay in the form of government spending cuts and job losses.

On the basis of capitalism, which has launched a neo-liberal offensive internationally against the working class, an independent Scotland could not offer a way out. The increasing adoption by the SNP to "free-market" orthodoxy has meant they have failed to offer a radical alternative to New Labour in Scotland.

At a time when growing sections of workers and young people are moving into conflict with New Labour and the employers the SNP’s move to the right have left them widely seen as another establishment party.

The falling away in support for Scottish independence in society generally over the last decade has meant that the SNP have been deprived their flagship policy to bolster their support.

A radical and fighting socialist alternative that puts the fight for decent pay, pensions and an end to war and inequality can make big advances in the election and beyond in Scotland.

This article first appeared in the April edition of International Socialist, newspaper of the cwi in Scotland

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April 2005