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Saturday, September 17, 2005


Letter in today's Glasgow Herald (Sat 17th). I have put in my full draft letter. Pieces marked << >> were removed by me to shorten it, marked < > by the Herald. It still ended up the longest letter being 2 lines longer than the one on cricket.
Congratulations to the Executive on their decision to reduce business
rates to the English level < (which since it is longer here since a rating
revaluation means, in practice, that we are now more competitive).>

This is the best, arguably the first, good news for the Scots economy since
devolution. it is particularly remarkable since it was Jack McConnell,
in his previous post, who was responsible for increasing rates in the
first place. While the doctrine of collective cabinet responsibility
prevents us knowing for sure, it seems likely that the accession of Nicol
Stephen, who, while running for Lib Dem leader, pledged support for
business tax cuts, may have played a part in this.

< The first step is always the most difficult & > there are other steps
which should be taken to change from a proportionately declining to a
growing economy. It is proposed that the rates reduction take place in
2007, though paradoxically there may be a partial reduction next year.
Surely, if it accepted that this will help grow the economy we would be
as well to start growing as quickly as possible.

The question of a reduction in corporation tax, the main plank in Ireland's
success should be faced. Per £ invested this should be more beneficial
because it particularly helps highly profitable companies which, by definition,
have most growth potential & encourages investment in mobile assets,
<< where we are in direct competition with other nations.>>

Corporation tax is currently a reserved matter, < a fact of
which the SNP have made play. However it is clear that it was reserved, not
as a matter of principle but > because it was thought, even by most Scots
that we were an intrinsically socialistic, << big-government,>> anti-business
nation who would increase taxes. This was always largely an illusion caused by the appalling Westminster FPTP electoral system but such feeling as there was (eg the initial decision to increase business rates) has been blown away by the
growth in political maturity Scotland is achieving by the act of running
our own affairs. This, despite all the disenchantment & the scandal of the
building, is ultimately the achievement of devolution. Thus I
do not believe Westminster would stand in the way of reducing corporation
tax or that even normally Unionist Scots, like myself, would let them.

<attitudes rather than writing a cheque, is for MSPs to learn to prove their
political virility, not by making regulations but by removing them. Holyrood
has been busy passing laws preventing altering a Victorian building, smoking,
hunting etc. Most of these have costs in jobs & all,
like all well meaning government actions, are subject to the law of unintended
consequences. Some loosening of the corsets of our nanny state would be
a relief.>> *

Thirdly MSPs should stop proving their political virility by producing more
laws. All new regulation requires more regulators, almost all destroy jobs &
all are subject to the Law of Unintended Consequences <(ie that everything has
unintended consequences)> .

<< 2 years ago it proved impossible to get Nicol Stephen's party to debate
Irish style growth policy. I year ago you** published a letter of mine expressing
surprise that, at a European hustings in Glasgow. only the SNP & Lib
Dem candidates had not opposed growth. Today we have a pro-growth concessus
that crosses party lines with only the Green's saying that this reform "focusses to much on growing the economy". >> There is now a real chance that Scots may again be able to build a future worthy of our past.

Neil Craig
* Fairly obviously this is a longer version of the next paragraph but I have kept in both drafts.
** Actually the letter was in the Scotsman.

I do believe that Westminster will be prepared to make Corporation Tax a devolved matter (or at the very least make the right to CUT this tax a devolved matter, which would actually be better since almost any limitation on the power of government to increase taxes is no bad thing).

The SNP think they would refuse. This actually means we can work together since ultimately it will be proven one way or another. People only fight over what cannot be proven. If Westminster refused I would be prepared to work for independence because I believe national wealth is that important & because I don't like being pushed.

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