Blog: The Great Risk Transfer - a view from the culture sector

by Kathryn Welch, Director, Culture Counts

Kathryn Welch, is Director of Culture Counts, a network supporting the arts, heritage, and creative industries in Scotland. Kathryn explores the relevance of the David Hume Institute’s Great Risk Transfer research to the culture sector and wider society.

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The Great Risk Transfer: employment and financial wellbeing report explores the changed relationship between employers and employees. For Culture Counts, a network supporting the arts, heritage and creative industries in Scotland, many of the concerns raised feel resonant to our sector.

A financially strained funding environment, combined with the long-term effects of Covid and the cost of living crisis, means many cultural organisations are struggling to create the conditions for fair work. Workers in the sector - particularly the high numbers of freelance workers and low-paid staff, bear the brunt of these conditions.

A freelance workforce

Freelancers are a hugely significant part of the creative workforce. Creative Scotland reports that 41% of creative workers in Scotland work on a freelance basis.

This is not a low-skilled or casual workforce but represents people of all levels of seniority, in vital-to-the-sector functions including technical, production and creative roles. Whilst a good number of these individuals relish the flexibility and variety of self-employment, the Cultural and Creative Freelancers’ study notes that many freelancers face a lack of opportunity to move into permanent or salaried jobs, which are simply unavailable in their job roles. Instead, freelance contracts are typically available on a project-by-project basis, shifting job precarity from employers onto the individuals they hire. 

Freelancers are not currently included in fair work legislation and 60% of freelancers are not members of a union, leaving them without much of the protection afforded to salaried staff. As a consequence, freelance artists are less likely to report feeling supported in their work than employed artists working in similar settings. And this support is much-needed; creative freelancers report extremely long hours, low pay, limited training opportunities and the necessity of undertaking unpaid work to maintain relationships and complete projects.

The Big Freelancer Survey 2024 carried out by Freelancers Make Theatre Work, presents “a workforce that is at breaking point due to unsustainably low pay and long hours”. Their research found that a third of freelancers reported average hourly earnings below the National Living Wage for that period; wages that would be illegal in the context of a PAYE job. Furthermore, almost a fifth of respondents reported working an average of 50 or more hours per week over the past year, which is over the legal limit defined in the Working Time Directive.

The Great Risk Transfer’s concerns about pensions are magnified amongst the freelance workforce: just 17% of self employed workers, and 13% of self employed women workers, participate in a pension scheme. Research found that the precarious nature of their work adversely affects the mental health of creative freelancers, exacerbated for many by a (financial) reluctance to take time off for sickness or holiday - bouncing unpredictably from full-on, intensive contracts followed by periods of stress and anxiety associated with lack of work. The Campaign for the Arts has raised concerns that the recent increases in many Employers’ National Insurance contributions following the UK budget may incentivise employers to move current employees into self-employment, placing workers against their will into these highly precarious working conditions.

Whilst creative freelancers face particular risks, all is not rosy for those in employed roles either.

The creative and heritage sectors have long been reliant on low-waged staff, especially in vital roles such as front of house and box office teams.

For creative roles, unpaid internships and very poorly-paid entry level roles have been an established route into certain career paths. There are social class distinctions here; unpaid internships have long been the privilege of those who can afford to work for free. Managing the challenges of chronically low-paid but creatively rewarding employment is, ironically, fast becoming available only to those with a financial cushion. Those who simply cannot afford to stay in very low-paying roles are increasingly leaving the sector altogether.

The Sutton Trust, for example, found that 43% of classical musicians have attended an independent school, compared to 7% of the general UK population.

The Heritage Alliance cite research from UK Heritage Pulse in their analysis of the impact of cost of living issues on staff working in the heritage sector, finding that stress levels within the sector are continuing to increase, with more than one in four heritage workers now reporting that they feel uncomfortably stressed on most days. They cite museum staff taking steps such as avoiding workplace social events, working from home to cut commuting costs, and taking less annual leave or time off in lieu in order to manage their heavy workloads.

The connection drawn by the Great Risk Transfer between financial precarity and organisational productivity feels particularly important.

For the creative sector, there is an existential risk created by its reliance on low paid staff. In an environment of increasing costs of living and entrenched low pay, even for experienced and skilled staff, it becomes increasingly difficult for employees to remain in the sector, or for workers from low income backgrounds to consider joining.

This is doubly problematic: organisations lose key people, skills and capacity, and the sector as a whole becomes less reflective of the diversity of Scotland’s people, backgrounds and experiences.

Concurrently, our creative institutions become less able to do what they do best - a recent Museums Galleries Scotland report finds that organisations faced with redundancy decisions are prioritising ‘keeping the doors open’ via front of house roles.

Instead, the report finds, museums and galleries are losing positions in curation, education, learning and participation roles - with long-term consequences for museums and galleries’ ability to preserve stories and support meaningful engagement with our past; what MGS calls “the ability to care for and share the stories of the collections we hold for the people of Scotland”.

For many creative and heritage organisations, volunteering is a mainstay of their operations, with volunteers contributing their time, passion and skills for the benefit of others. With narrowing economic margins, people may well have less capacity to contribute. The 2023 Scottish Household Survey found that the Scottish volunteering rate had dropped to 18%, a drop of four percent from 2022, and eight percent lower than pre-Covid. 

Scotland’s geographies bring additional financial issues for this low-paid creative workforce; concerns shared with other sectors such as hospitality. The heritage sector, in particular, is defined by sites across rural areas, where prospective employees face challenges associated with lack of affordable public transport, high costs of housing and the harder impacts of the cost of living crisis to rural areas.

#EvenHereEvenNow, a manifesto created by artists across Scotland’s islands, highlights higher energy costs, fuel poverty, digital connectivity and limited transport as challenges that disproportionately affect islands-based artists.

The risks of precarious and low-paid employment are not borne equally across Scotland’s creative sector.

The Equal Media and Culture Centre for Scotland found that 60% of part-time roles in the arts sector are held by women, and that almost three times the number of women to men cited care responsibilities as a major barrier to their work in the arts.

Reflecting on the impact of the pandemic to the sector in terms of reductions in job opportunities, Chi Onwurah MP, Chair of the All-Party Parliamentary Group for Creative Diversity, highlighted that “without action, we risk exacerbating inequalities further in the creative industries and an entire generation of talent – the future of the sector – could be lost”.

This is a matter of inclusion and equity. For the creative industries it also represents a loss of creative talent, a narrowing of our creative ambition and a reduction in the breadth and diversity of our creative output - a very particular rendering of what the Great Risk Transfer describes as “productivity”.

The narrowing of participation in culture and heritage, whether in paid work or in volunteering, could mean that these sectors - which are important forums in which society experiences and understands itself - in turn reduce in creativity, in inclusion, and ultimately in relevance. 

Organisational challenges

At Culture Counts, whilst we echo the overall concerns highlighted by the Great Risk Transfer, we recognise the challenges facing employers and organisations in the cultural and creative sector.

This picture is not a battle between exploitative employers and vulnerable workers.

Many creative organisations are tiny (a mapping exercise by Scottish Contemporary Art Network found that 84% of arts organisations report an annual income of less then £425k), and dependent to a very large extent on public funding.

Many employers actively champion aspirations to improve working conditions in the sector, and are acutely aware of the importance of widening access to creative careers, creating sustainable livelihoods in the arts, and supporting the wellbeing of staff.

Creative and cultural employers consulted for Culture Radar’s Review of Fair Work prioritised actions to help them resolve low pay and precarious work, support workers most impacted by Covid lockdowns, invest in workforce skills and improve employee wellbeing.

Initiatives to prioritise Fair Work are directly connected to a funding landscape that has been stagnant - and in some cases declining - over a period of years and decades. As wages - rightly - rise due to increases in the Minimum and Real Living wages, many organisations report a direct impact on their financial stability - leading to operational deficit and/or having to use reserves to meet the cost of increased wages.

For some organisations, adapting to provide increased wages has come at a cost of job security for employees, with employers unable to provide stability for workers due to being unable to commit to longer term contracts thanks to their own annual funding settlements. Whilst financial risk is being transferred from employers to employees, it’s also important to note that the chain continues upward, with three year funding settlements for Scottish Government core funded cultural organisations promised in the 2021 SNP Manifesto, but as yet unrealised. 

The experience of the arts, heritage and creative industries largely echoes that of the Great Risk Transfer more broadly, sharing concerns in terms of employee wellbeing, inadequate pensions, financial precarity and its impact on productivity and society in Scotland.

The sector-specific contexts for the creative sector, notably a low-paid and largely freelance workforce, the importance of a diverse workforce for a vibrant creative output, and the challenge of managing standstill and short-term funding commitments, add further food for thought to the findings.

At Culture Counts, we echo DHI’s recommendations for further steps to embed the principles of Fair Work and Living Pensions into the future of the creative workforce - whilst noting the particularities of the sector that add further nuance and challenge to the equitable and sustainable implementation of such initiatives.

Culture Counts looks forward to being part of these conversations going forward via our role on the Scottish Government’s Fair Work Taskforce. We call for a wide-ranging consideration about the whole picture of investment in culture, encompassing not just Creative Scotland and Scottish Government funding, but philanthropy, trusts and foundations, Local Authorities and earned income. Investment in culture fundamentally affects the current and future workforce, and the possibilities for Fair Work for all.

Culture and the arts cannot become solely by rich people for rich people - a broader, fairer and more sustainable sector enriches us all.

Ends

Sharing thumbnail image - Pianodrome (2018). Photo: Andrew Downie. Edinburgh Festival Fringe Society.

Blog: Scotland needs economic hope

27th November 2024

by David Gow, DHI Trustee

"Fings can only get worse," warned PM Keir Starmer in a negative take on the 1993 D:Ream anthem that ushered in the last Labour government and the Northern Ireland band has now banned the party from using. It's one message from the Prime Minister the public fully believes in five months after Labour's landslide win.

Our latest Understanding Scotland Economy Tracker, the 13th 'wave' in the series, highlights a deepening pessimism among Scots, young and old, about their own and the country's prospects. Almost two-thirds (63%, up 9% on the August survey) believe the economy has worsened in the past year and 65% (up 13 points) expect a further deterioration. At a personal level, the sense of doom is slightly less dark: at 48%/44%. But don't hold your breath.

It's pretty plain that Scots, like most Brits, know and feel that the UK is measurably poorer now than it was, say, pre-pandemic or pre-Brexit or pre-great financial crisis even over a decade ago. The last parliament (2019-24) saw the worst decline in earnings growth for over 60 years and the "boomers'" children are worse off than their parents. Too many of these are now attracted to the Far Right - across Europe and elsewhere.

Sebastian Burnside, NatWest chief economist, told me at the tracker's launch (25 November) that he didn't expect a new recession but with Donald Trump already slapping prospective tariff hikes on Canada, Mexico and China it must be nip and tuck. A generalised tit-for-tat trade war will almost certainly deepen any recessionary tendencies, notably in the eurozone, with the ghost of Smoot Hawley 2.0 worrying the hell out of policymakers and observers. (Or it should be!)

Skipped meals and depression

Almost a half (47%) of younger Scots, according to our survey, say economic anxieties and pressures are affecting their mental health - a finding true of a third (32%) of Scots as a whole. Three in ten of us are losing sleep over our finances. People are cutting back on buying fresh food products and skipping meals (as many as 19%) and this is more true of young people than other demographic groups.

For me and others the greatest worry is the impact upon young children. Danny Dorling, Professor of Geography at Oxford University and a surprise guest at the launch, commented the worst affected in terms of the rise in child poverty in the Europe is England, he shocked us. No English county outperforms Scotland in this regard. In terms of economic pessimism, suggested this was a global trend - with some notable exceptions in countries such as India... and Russia - for other reasons.

This, of course, is no consolation. Around a quarter of a million of Scottish children (26%) live in relative poverty and the Scottish Government is way off reaching its 10% target by 2030-31, even with the Child Payment. We all need hope but our young people, above all children, need an injection of this most of all if we are to begin to tackle the enduring UK/Scottish problem of low productivity growth which, as Burnside said, is the biggest source of declining living standards.

Investing in the future

Rachel Reeves, the UK chancellor, is struggling to inject hope and optimism into business and consumers for all her talk of investment and growth. Our tracker, equally, sets a high bar for Shona Robison, finance secretary, to cross when she presents the Scottish Budget on December 4. Even the unexpected boost to the Scottish Government's net fiscal position from the first Reeves budget - "transformed" according to the IFS - may not be enough.

Robison, cannot promise the earth but she could and should offer the prospects of a (eventually) more stable outlook and put the emphasis on investment in education and training as well as in the most promising economic sectors, including the (struggling) creative industry. Our tracker points to an urgent need, above all, to restore public confidence in the future.

"Get Scotland Working" is likely to be a theme (h/t the UK version unveiled on November 26) for her to adopt. Not in terms of unemployment but incentives to enter or re-enter the labour market, notably among the more than 300,000 Scots on adult disability payment and those economically inactive as a whole (22.6% of the 16-64 age group) of which there are a staggering 9m in the UK.

However, for many work is not a route out of poverty or cutting the welfare bill, with around four in ten of those on Universal Credit in Scotland, being in work. Low paid and precarious work traps many in a constant battle to make ends meet - this certainly won’t help boost productivity with so many people losing sleep over their finances.

Collectively, Scottish politicians and civil society need to turn around what is one of the most arresting tracker findings: a net 64% of our citizens believe the economy works in the interests of the wealthy while a net -56% think it does not work for them individually.

• The survey of 2,233 respondents was designed by the DHI and Diffley Partnership, carried out 1-5 November 2024

Image credit: sharing thumbnail image by Jon Tyson free licence from Unsplash on 27.11.2024

Press Release: Scots report increased financial pressure impacting their work and home life

48% of people living in Scotland believe their financial situation is worse than a year ago, our independent quarterly tracker has revealed.   

Since August 2024, there has been a six percentage point rise in people feeling that their own finances have worsened in the last year – with 3 in 10 people (29%) admitting they have lost sleep over money.

While 63% believe that the general economic conditions are worse, up nine percentage points, 65% of people said they believe that the general economic conditions will continue to decline, up 13 points on the last quarter.  

The latest results for the Understanding Scotland Economy Tracker, from the David Hume Institute and polling experts Diffley Partnership, suggest a growing lack of optimism over the last three months and pose big questions for Shona Robison ahead of the Scottish Budget.

The latest edition of the survey from November 2024 shows that:

• More than 1 in 6 people (17%) report strained relationships at home because of money

• 1 in 6 Scots (16%) report an impact on their physical health due to worries about money

• 1 in 3 people (32%) report an impact on their mental health due to worries about money

• Only 15%  say that concerns about money matters have not affected them

• 3 out of 4 people (75%) believe the economy works primarily in the interests of wealthy people

This shift towards a less positive outlook suggests that political messaging from Prime Minister Keir Starmer that “things will get worse before they get better” ahead of Labour’s first budget in October has been heard loud and clear by Scots.

However, there is not a complete lack of optimism with younger Scots more likely to believe that their financial fortunes will turn. Those aged between 16 and 34 appear more optimistic with 25% saying they believe their own economic situation will get better. This compares to just 6% of 45 to 54 year-olds, 8% aged 55 to 64, and 5% of over 65s.

When looking at the policy priorities for Scots, healthcare and the NHS remains the top priority of Scots with nearly half (47%) citing this as one of the top three issues facing Scotland.  A third (34%) cite cost of living and inflation, this has declined eight percentage points from November 2023. One in five (19%) put poverty/inequality among the top three issues facing Scotland.

Scott Edgar, Senior Research Manager, at the Diffley Partnership said:

“The latest findings from the Understanding Scotland Economy Tracker show that public confidence in the economy has taken a massive hit over the last three months.

People are reporting that concerns over money matters are impacting their work, home life, and health.

With two-thirds of Scots expecting the economy to worsen over the next twelve months, many will be looking to next week’s Scottish Budget as a chance to offer a signal of confidence in the nation’s economic future.”

Susan Murray from the David Hume Institute said

“With the Scottish Government’s budget just over a week away, there is an opportunity for Finance Secretary Shona Robison take on board the large number of people struggling financially.

“However, as the weather turns colder, it feels like there is a long hard winter ahead for many. I hope all political parties take on board the large number of people feeling so stretched as the political horse-trading starts to get the Scottish budget passed. 

“The economy will not turn a corner and productivity will not increase until more people are sleeping easily at night and not lying awake worrying about money.”

  Notes to editors: 

• Designed by the Diffley Partnership and the David Hume Institute, the survey received 2,233 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 1st-5th November. Results are weighted to the Scottish population (2021 estimates) by age and gender.  

Image credit: sharing thumbnail image by Claudia Wolff, free from Unsplash on 24.11.2024

Reflections: The Art of Asking Questions

15th November 2024

Graham Boyack reflects on our recent event with John Sturrock KC and shares information on how the Scottish Mediation Network is supporting young people to develop effective questioning and listening skills

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I was delighted to attend the David Hume Institute event in partnership with EICC Live on the important subject of asking effective questions. The Q&A led by Clare English brought John Sturrock’s presentation to real life. Clare in combination with the audience, asked John, a great series of questions about how to apply his work and discussed the difficulties they thought might be encountered.

One of the questions raised by the audience was how we equip the next generation with these skills.

I had an answer but as time was pressing on the event came to a close before I could let anyone know - so here is an update on what Scottish Mediation is doing to encourage the next generation to not only ask great questions but to have the skills to listen to the answers.

Young Talk in Schools

Since 2006 Scottish Mediation’s Young Talk programme has been training primary and secondary school students in how to be Peer Mediators.

To be a mediator, essential skills include the ability to listen effectively and have the ability to ask great questions.

Since 2021 through a collaboration with Our Minds Matter in Fife we have delivered this training to every primary school in fife and are currently completing training across all the secondary schools. The training we carry out however goes deeper, and specifically looks to equip young people in how to deal with the everyday conflicts that arise in their lives.

Within peer mediation training, there is a large focus on helping peer mediators to understand and articulate their own emotions and needs, and how they might be able to recognise the emotions and needs of the participants in conflict. While this increase in emotional intelligence is beneficial within peer mediation, it also enables peer mediators to better care for their own emotional wellbeing outside the peer mediation process.

Within peer mediation, the young people in conflict are asked to identify how certain things made them feel, and what they need in order to feel better about the situation. This allows them to increase their emotional intelligence, while also being able to acknowledge and empathise with the boundaries and needs of the person with whom they are in conflict.

Strengthening relationships

Peer mediation also improves mental and emotional wellbeing by providing a space for young people to re-engage in relationships when conflict has occurred.

Positive relationships are incredibly important for children and young people’s mental health. Research also shows that conflict, when not resolved well, can lead to relationship breakdown. However, when conflict is communicated well, and a resolution is found together, it can actually strengthen relationships.

Thus, by providing a space in which young people can work through conflict together, those in conflict are better able to maintain vital friendships, or cordial relationships, that respect each person’s needs.

This year we’ve taken this work to a number of schools in Scotland, including in Perth and Kinross with the support of the Gannochy Trust. If you’d like to find out more about it a report on our work in Fife is available here, you can also link to how this work relates to the latest Scottish Government work on how a public health approach to violence reduction here.

Further information

If you are interested to find out more about the Young Talk programme, we’d be delighted to speak to you. Call 0131 556 1221 or get in touch with us by emailing admin@scottishmediation.org.uk

Image credit: sharing thumbnail image by Taylor Flowe free from Unsplash 15.11.2024

Reflections: Transforming the housing system in Scotland

16th October 2024

Callum Chomczuk reflects* on the recent launch of our work with Professor Duncan Maclennan to Transform Scotland’s Housing System. Callum is the national director of Chartered Institute of Housing in Scotland. 

Photo Credit: Allan Lloyds, Live to Air

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The David Hume Institute has launched a new project with Professor Duncan Maclennan to consider the actions needed to transform the housing system in Scotland. 

Transforming the housing system is a fairly large statement of intent but given the challenges we face today with the declaration of local and national housing emergencies, rising homelessness, falling supply and increasing unaffordability, the ambition set out in Duncan's remit is both proportionate and necessary. Indeed, given that we have been in a housing crisis since at least the 1980s, the challenge facing this review is to thoughtfully look at the whole housing system and consider the question of what a fixed housing system would look like?

Now, it is easy to set out a menu of policy interventions that we believe are required to improve housing outcomes for a certain client group. We do it all the time, and we all have our biases. This could be a housing and infrastructure agency, market led approaches to affordable housing, rent caps, professionalisation, increased grant levels, or meeting the demand for owner occupation amongst many, many more.

However, the repeated failure of our housing policy over the decades has been looking at it as a tenure or sectoral issue rather than a systemic issue. We can’t ignore the fact that we are part of a wider UK housing sector with social security, monetary and fiscal policy all reserved to Westminster, and we can’t ignore the fact that changes to one part of the housing sector, have consequences across it all.

That is why, for example, so many housing representatives in Scotland are concerned about the proposed model for private rented sector rent controls in the Housing (Scotland) Bill being considered by parliament. It is not that rent controls by themselves are undesirable or unworkable, but without recognition of the impact it will have on landlord investment, homelessness presentations and mid-market rent supply and meaningful measures to address them, it will only exacerbate the existing housing emergency. Housing is systemic and interconnected so our policy prescriptions must be so too.

But regardless of the recommendations that Duncan’s report produces, and I know there will be things we instinctively agree and disagree with, the biggest challenge will be how much capacity, curiosity and resource is there in the sector and government for system change and risk taking? Will we engage with the process or just judge the recommendations at the end depending on how many of our priorities have made it into the final draft?

I think back to the publication of the Scottish government’s Housing to 2040 paper and how it set out a positive vision for our housing system, but it was just a vision. Like any vision, it needs a framework for delivery, it needs evidence, it needs new structures, more collaboration, more ownership and more humility. We need to look at the foundations of a better housing system and how we correct market failure.

So, this review is a chance to re-start the discussion on getting to that improved system but also being honest about the things we can’t do, or the things we need to wait to do.

Are we willing to be part of an open discussion? Can we all compromise on the things that we have fought so hard for to create a better housing system. Can we prioritise the outcome and not the input? It will be great to be part of the conversation. I hope we can.

*This blog is kindly reproduced with the permission of Callum Chomczuk, National Director of the Chartered Institute of Housing.

Blog: Are we singing a new song?

29th August 2024

by David Gow, DHI Trustee

"Fings can only get worse," Sir Keir Starmer intoned in the 10 Downing Street rose garden on August 27 in a reverse reprise of Labour's 1997 campaign song . "Before they get better." He added that the UK should "accept short-term pain for long-term gain." It's a tough ask but maybe Scots at least are up for it.

Perhaps, indeed. What emerges from our latest quarterly survey of voter sentiment towards the Scottish Economy, Understanding Scotland, is that Scots are increasingly torn between feeling (a shade) more upbeat and anxious, between modest optimism and continuing pessimism.

Certainly, more than half (56%) of the 2227 respondents to the survey conducted exactly a month after the July 4 General Election still think Scotland is heading in the wrong direction but that's six points down on the record 62% in May while those believing the opposite are up four points at 23%. 

What's more, fears about the cost of living/inflation at 58% are down close to levels last seen in January 2022 (56%), probably reflecting the upturn in earnings and even (some) lower prices. (The survey pre-dates Ofgem's announcement of a 10% hike in energy guide prices). Most tellingly, those thinking that general economic conditions are worse than 12 months ago have fallen to 52% (net) or the lowest level since the survey began in October 2021. Personal negativity is down to 42% from a high of 65% in November 2022 while optimism is up to 15% (net) - hardly a dizzying decline but worth monitoring to see if it upticks

As we and our colleagues at the Diffley Partnership say in the report's intro, "a growing proportion are unsure about the country’s direction, suggesting a populace still searching for clarity in uncertain times." As we point out, there remains a significant sense of precarity, notably among families with children.

Unhealthy options among the poor

More than one in five (22%) is still cutting back on fruit and veg to cut food bills, a bad signal for a nation fighting rampant obesity, while a similar number is reducing meal/portion sizes to save money - the same goal pursued by the 14% skipping meals. It's surely bad news that more than a half (52%) admits to shopping on price rather than health, while a quarter or more is eating processed food and/or cheap food requiring little or no cooking. And we know from here and elsewhere that it's poorer parents, particularly young mothers, who skimp on meals so they can feed their kids.

Financial resilience remains worryingly high among less well-off households. A third of households with children are not confident they could raise £100 in an emergency without borrowing, a level that rises to 58% when the required loan is £500. Inequality may not be a substantial policy issue (at just 8%) but poverty remains among the biggest priorities (27%).

Tax and spend alerts

Ahead of the October 30 Budget (UK) and the Scottish Government's renewed brake on spending, concern about manging public finances is on the up - at 29% compared with 24% a year ago. And a third remains convinced spending on public services is an important issue facing the Scottish economy. Rachel Reeves' "black hole" is clearly and understandably putting the wind up a lot of folk., including actual and/or potential pensioners (a concern for 12% or up three points on May.)

Will hospital consultation/treatment waiting lists come down? Obviously, it's too soon to tell but healthcare and the NHS remain by far the biggest concern (51%) - compared with the mere 8% thinking of the constitution, an issue that does not win elections. Nor, surprisingly, do green/climate change issues (just 11%, down one point on May).

Unsurprisingly, however, immigration and crime are rising up people's political agenda, with the former at a survey peak of 13% (up three points on May) and the latter at a new high of 11% (up two points). The two are often wrongly linked, notably in tabloid media, but both may well prove growing headaches for the new UK government. We shall closely monitor trends here.

Overall, it's clear from this survey that the new UK government and whichever administration emerges from the elections to Holyrood due in May 2026 have a lot to do to convince a sceptical population that those "sunlit uphills" can be glimpsed around the corner. Again, hardly surprising after this dreich summer...

End

Image credit: sharing thumbnail image by Austin Chan free from Unsplash 29.08.2024

Blog: Shaking off our misery?

Blog by David Gow, DHI Trustee

If the public mood in Scotland, as measured by the latest quarterly Understanding Scotland Economy Tracker, is pretty much as bad as it seems, we might as well call off the final five weeks of campaigning in the UK general election and put the politicians out of their misery by voting now. 

After all, there are critical and more exciting events coming up like the opener in the Euros 24: Germany v Scotland on June 14 in Edinburgh's twin city Munich.

The latest tracker certainly paints a sombre picture of how we Scots feel. Almost two in three (62% compared with 58% three months ago) believe Scotland is moving in the wrong direction - the highest level since the series began. And less than one in five (19% compared with 23% in February) think it's heading the right way. These are devastating findings for our political class as a whole (which should read the findings and wake up to reality). 

The reality is that Scots are worried above all by Healthcare/the NHS - 52% view this as the top issue - and the cost of living (40%) though this latter concern is easing though hardly to the point where "turned the corner" talk is credible. And almost one in five (18%) list trust in politics as the critical issue - a number that's rising.

This does not amount to a conducive environment for a bog-standard campaign centred around "tax and spend" policies (like the one we're having now). Scottish voters are more than disgruntled. Their mood may not (or perhaps even may) amount to despair or rage but they certainly need a dose of hope and optimism. And please don't talk about the constitution - only 7% think it the priority issue.

The overall findings gave plenty of food for thought - and lively discussion - at the latest tracker's presentation in the historic home of RBS on St Andrew Square. It was a lovely late spring morning with sun shining through the upstairs windows and birds carolling us but the discussants were reflective, pondering the state we're in - not the one the politicians are peddling elsewhere.

Introduced by Scott Edgar of the Diffley Partnership, the tracker's results were analysed by Sebastian Burnside, NatWest Chief Economist, and João Sousa, Deputy Director at the Fraser of Allander Institute, with a strong emphasis on cost of living issues, labour market developments and fiscal outcomes and outlooks.

This attendee was struck by several things, notably João's point that the rise in average earnings in Scotland, albeit outpacing inflation now, still remains below the increase in prices - i.e., people do not feel and indeed are not better off than last they were when they went to the polls in 2019. Indeed, this is the first time this has happened. The tracker shows Scottish sentiment in line with this: "...economic pessimism may prove hard to shake despite incremental improvements."

Women, especially those with children, are among the most pessimistic.  Even if some of the pessimism has lifted overall only 11% think things generally will improve (be much better or somewhat better) in 12 months' time and, when it comes to personal wellbeing, this rises to just 17%. Still, fewer folk are cutting down on leisure activities to make ends meet or losing sleep over their finances albeit the decline is quite marginal - and three in five Scots are still cutting back on non-essential purchases.

Sebastian intrigued the audience with the bank's internal evidence that its customers are dipping into their savings/deposit accounts when they're forced to make bigger outlays such as repairing the car. Overall, it seems, the struggle to remain on top of the monthly budget is as tough as it can get, notably for lots of younger folk. More than half of Scots (53%) remain dissatisfied with income covering the cost of living.

Campaign mantras such as "change" or "stability" in this context seem beside the point, especially when the fear lurks that the next government will be forced, willy nilly, to raise taxes in order to deal with a worsening UK fiscal position as the IMF and others have warned. It's a frequent message from a weary public when the TV crews conduct 'voxpops' in the pub or coffee shop.

Will the next tracker findings - due in late August or several weeks after the July 4 general election - reveal an uptick in optimism?

Don't hold your breath! It's more than likely that, whatever the outcome, voters will be suspending judgement (as many may do by abstaining and driving turnout down to historic lows) . What they most want is services delivery, not warm promises things can only get better. Are the candidates paying attention on the stump?

Watch the event recording:

Understanding Scotland Economy Tracker - May 2024 Insights

Image credit: sharing thumbnail image by Tadeusz Lakota free from Unsplash 03.06.2024

Press Release: Healthcare and Cost of Living Top Priorities for Scots ahead General Election

Latest in the Understanding Scotland Economy Tracker series shows that healthcare and the cost of living remain the top concerns as candidates get set to make their offer to voters for the 4th of July election.

As Scotland gears up for the General Election, the latest survey from the Understanding Scotland Economy Tracker series reveals that healthcare and the cost of living are at the forefront of Scottish voters' minds as they get ready to decide how to cast their votes in July. 

Latest findings from the series show the top two issues for voters in Scotland are:

• one in two Scots (52%) cite healthcare and the NHS

• two in five (40%) the cost of living and inflation is a key issue

Graph to show the top priorities and issues cited in the Understanding Scotland Economy Tracker over time.

A host of other issues remain important to Scots, including poverty/inequality, trust in politics, the economy, and housing, which are regularly selected as top issues facing Scotland by upwards of 15% or more of Scots. However, there are notable changes in prioritisation among these issues, with emphasis on trust in politics rising two percentage points to 18% and emphasis on the economy falling two percentage points to 17%.

The constitution and devolution is reported as a top issue by only 7% of Scots in the latest figures for May 2024.

As parties craft their platforms and campaign messages, these results indicate that healthcare and the cost of living will be key battlegrounds in the upcoming election. 

Scott Edgar, Senior Research Manager at Diffley Partnership, said: 

“With 52% of Scots prioritising healthcare and 40% focused on the cost of living, it's clear that these will be decisive factors in the upcoming election. Parties who can effectively present solutions to these concerns over the course of the campaign are likely to gain a significant advantage at the polls.”

Susan Murray, Director of the David Hume Institute said: 

“These findings underscore the critical importance of healthcare and the cost of living for Scots as we approach the general election in July. Political candidates will need to address these issues head-on if they want to resonate with voters and secure their support”

Ends

Notes to Editor:

Designed by the Diffley Partnership and the David Hume Institute, the survey received 2,275 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 2nd-7th May . Results are weighted to the Scottish population (2021 estimates) by age and gender.

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Press Release: Two-Thirds of Scots continue to reduce spending

Latest in the Understanding Scotland series continues to shed light on Scots’ survival tactics during challenging economic times

The Understanding Scotland Economy Tracker survey tracks economic attitudes and spending intentions from more than 2,000 members of the Scottish adult population every 3 months.  The fast turnaround time, this data was collected only two weeks ago, means early identification of changes in trends to support decision-makers.    

The latest insights show two in three Scots (67%) have resorted to reducing non-essential purchases, while significant proportions continue measures such as cutting back on energy use (64%) and leisure activities (62%). Additionally 45% report decreased savings contributions, and over a third are tapping into them for everyday expenses. These coping mechanisms are particularly prevalent among younger age groups, underscoring the disproportionate impact of the high cost of living on  working-age individuals.

The study reveals a cautious outlook among Scots regarding future spending. Both essential and non-essential spending expectations show little change, indicating ongoing caution amidst economic uncertainty.

Furthermore, the latest findings highlight generational divides in priorities.  Healthcare and the NHS are paramount among older age groups, whilst younger individuals are more focused on addressing rising living costs.

The study also reveals growing doubts among Scots about Scotland's trajectory, with the majority (58%) believing that the country is heading in the wrong direction. This marks a three-percentage-point increase from the previous wave and reflects an increasing sense of pessimism about the future.

Mark Diffley, Founder and Director of Diffley Partnership, said:

“The latest findings from our regular Understanding Scotland series continue to shed light on the economic landscape in Scotland today. The fact that seven in 10 Scots think that economic conditions are worse than 12 months ago and six in 10 think conditions will be worse in 12 months’ time, reveal ongoing and widespread pessimism. The data also again reveals the challenges posed by rising living costs and offers a glimpse into the daily struggles of many Scots, particularly those from disadvantaged backgrounds, highlighting that the cost-of-living crisis is far from over in terms of real life experiences.”

Susan Murray, Director of the David Hume Institute said:

“These findings reveal  a stark snapshot of the economic reality  of living in Scotland today. For anyone wanting to improve productivity or economic growth, focus on the number of Scots continuing to lose sleep over their finances, which creeps up another one percent this quarter to 30% and rises to 43% of 35 to 45 year olds. With so many of your workforce affected, we can only hope that things don’t get worse before they start to improve.”

The full report can be found here.

Notes to editors

Designed by the Diffley Partnership, the survey received 2,305 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 1st-5th February. Results are weighted to the Scottish population (2020 estimates) by age and gender.

Image credit: Sharing thumbnail image: photo by Paul Rysz free on Unsplash 28.02.2024

Press release: Is trust a must for a brighter economic future?

“Trust plays a crucial role in a successful economy.”  says Charlie Woods, the author of the latest David Hume Institute Discussion Paper launched today ahead of an on-line event on Thursday 23 May at 1.30pm. Is this being overlooked by business and political leaders who are seeking solutions to weaker than desired economic performance?

DHI Director, Susan Murray, will be joined in this webinar conversation from New York by Dr David M. Bersoff, from the Edelman Trust Institute, Charlie Woods, the paper’s author, and leading mediator John Sturrock , who works to build trust in negotiations.

David will share the global context on trust from the 2023 Annual Trust Barometer to help explore the relevance of trust to the economy and the labour market.

At a time when the majority of Scots are concerned about household finances, think Scotland is heading in the wrong direction economically and are pessimistic about our economic future, are we paying sufficient attention to the potential of increasing trust to boost economic performance?

David Hume Institute Director Susan Murray says:

“Research shows a strong relationship between levels of trust in society and economic performance with more trusting societies generating more income per person than others. Thinking differently about what helps boost economic performance might reveal we have been looking for too long in the wrong places to find the Holy Grail of a more productive Scottish workforce.”

The webinar is free to watch here.

ENDS

Notes to Editors

• For media enquiries contact Shelagh Young, David Hume Institute, shelaghyoung@davidhumeinstitute.org

• The Discussion Paper: Is Trust an undervalued ingredient for a thriving economy? Is available here

• The 2023 Annual Trust Barometer can be found here

• The David Hume Institute is an independent think tank based in Scotland. The charity was established in 1985 to increase diversity of thought on the economy and related public policy. Find out more on our website

Press release: Scots continue to cut spending

22nd November 2022

Image credit: Photo by Andrew Seaman free from Unsplash 22.11.2022

New research published today by the David Hume Institute and the Diffley Partnership on economic attitudes and behaviours has revealed widespread pessimism about Scotland’s economic outlook.

• 9 in 10 Scots (93%) believe general economic conditions are worse now than they were this

  time last year and 77% believe the situation will deteriorate further over the coming year. 

• 6 in 10 people (62%) are planning to spend less on restaurants and hotels and 58% are

  planning to cut down on leisure and culture spending over the next 12 months.

• Almost 1 in 2 (48%) plan to spend less on clothing and footwear.

• 7 in 10 (68%) already report not turning the heating on when they otherwise would have

  and nearly 1 in 5 (17%) of people have skipped meals to save money

• Intentions to cut spending have increased for every good and service listed in the survey

  since Understanding Scotland began, posing a big challenge for the Scottish economy and

  particularly the hospitality sector.

The new Understanding Scotland polling has found that 8 in 10 (79%) of people view the economy as it is currently organised as working primarily in the interests of the wealthy, while 65% of people feel their financial situation has worsened over the past year.

Wrong direction?

Just under half of people (49%) believe that things in Scotland are heading in the wrong direction, the highest percentage providing this answer since Understanding Scotland was launched last year. Dissatisfaction with income levels remains high, with almost 1 in 2 (46%) of people dissatisfied with their income level and a further 55% dissatisfied with their income’s ability to cover the cost of living.

People from the most deprived areas are also being increasingly pushed into financial precarity. One in five (20%) have had to borrow money from family or friends and 19% have used a buy-now-pay-later scheme when they otherwise wouldn’t have. This is despite 22% of this group having changed or looked at changing jobs to earn more and 15% trying, unsuccessfully, to take on more hours/paid work.  

During these tough times, 2 in 5 (40%) of people have reduced their donations to charity, while rising prices and inflation are pushing 1 in 5 (22%) of people to cut down on portion sizes to save money.

People from the most deprived areas plan to reduce spending on essentials further this next year: almost 2 in 5 (37%) plan to spend less on eating out and household goods and services (38%).

Parents feel the pinch

Parents, in particular, are feeling the pressure of current economic turmoil: almost 2 in 3 (64%) are dissatisfied with the ability of their income to cover the cost of living and nearly 3 in 10 (28%) reflect that their current financial situation is much worse than it was 12 months ago. This pressure has resulted in more than 1 in 3 (35%) of parents losing sleep due to stress or anxiety about personal finances and higher percentages of parents reporting borrowing money from family or friends and using credit cards or buy now pay later schemes than people without children.

Amidst predictions of further tough times to come following the Autumn Statement, these statistics raise questions of how much worse things can get and how current economic conditions will impact other issues of rising concern among survey respondents, such as poverty and inequality and healthcare and the NHS.

Reflecting on the findings, Mark Diffley, founder and director of Diffley Partnership who conducted the research, said:

“The public in Scotland continue to have widespread concerns about both the of the state of the economy and their ability to cope with the ongoing cost of living crisis.

Although concern and anxiety are widespread, we continue to see those in the most precarious situations feeling most vulnerable and ill prepared, particularly those who live in the most deprived parts of Scotland.

Despite a modest fall in pessimism about the economy over the next year, policymakers and business will be concerned with the finding that spending on non-essential items, like leisure, eating out and holidays, is likely to fall significantly over the coming year.”

Susan Murray, Director of the David Hume Institute, who helped to develop the survey, added:

“The cost-of-living is continuing to have prolonged effects in the ways in which people are choosing to spend their money. Hospitality and culture industries are being hit hardest as people cut back spending due to rising food and heating costs.

Although Scots are less pessimistic about the state of the economy next year, we are still witnessing significant financial stress among families with more than one third of parents losing sleep due to financial stress.”

ENDS

Notes to editors:

1. Designed by the Diffley Partnership, the survey received 2,191 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 3rd - 8th November. Results are weighted to the Scottish population (2020 estimates) by age and sex.

2. About Understanding Scotland: Understanding Scotland is a high-quality quarterly survey that delivers insights into Scottish behaviours and attitudes towards society, the economy and the environment. The survey fills a vital gap in research, providing the socioeconomic insights and indicators needed for effective decision-making, with regularity and timeliness.

Blog: A View from the Lab

by Shelagh Young, Engagement Lead, David Hume Institute

25th September 2022

Friday’s “fiscal event” has proved to be a powerful curtain raiser for new research we are launching later this week exploring how ordinary people are coping with growing risks to their financial wellbeing.

Image credit: Photo by Louis Reed free from Unsplash 25.09.2022

If you feel like a rat trapped in the Trussonomics laboratory unsure whether the trickle down drug will cure your financial ills, you are not alone. The markets have already announced their damning verdict on the risks being taken with the UK economy as the pound tumbled and money was sucked out of pension funds at a rate which will have a substantial number of people rapidly recalculating their retirement plans.

Even impartial commentators such as the Institute of Fiscal Studies, have referred to the UK Government’s decisions as a gamble. Chancellor Kwasi Kwarteng maintains that the tax cuts will benefit everyone while others have named it a “budget for the rich”. 

However it is described, the facts are clear. At the sharpest ends the tax cuts announced will give the average FTSE100 CEO a return of £162,500 a year while the Resolution Foundation has calculated the annual benefit to the poorest fifth of households at just £90. That staggering difference means the difference between paying your energy standing charges for just four months while the richest receive a tax cut worth more than 99% of the UK population are paid in a year.

The risks to the Government are obvious - electoral success in 2024 surely lies in ensuring that their hoped for economic growth meets the needs of our struggling NHS and social care systems as well as enabling people outside the top 1% to feel their living standards are protected. The risks to the rest of the population vary. Most obvious are reduced returns from pensions and other investments if markets slump further and the spectre of further austerity measures if the large scale public borrowing is not mitigated by growth.  

One tiny part of this unprecedented low tax, high spending, banker’s bonus bonanza of a budget provided a clue as to who is most at risk if the gamble doesn’t pay off. The decision to require low paid part-time workers who receive income top-ups through Universal Credit to seek more paid working hours. 

In August we surveyed how people in Scotland are responding to the cost of living challenge. 9% had already tried and failed to find more hours of work. The devil will be in the under-researched detail, but it is interesting to know why people cannot find more paid work when businesses are crying out for staff. Is it well-known barriers such as the fact that hospitality requires evening work which doesn’t fit with caring responsibilities or that wages are too low to cover the costs of additional child or elder care? This is the type of evidence that should be driving the Government’s policy. Instead, our poorest households are being forced into the vanguard of an unprecedented experiment.

The “fiscal loosening”  prescribed by Kwasi Kwarteng is based on the belief that low taxes and a small state are the treatment for fuelling growth.  Unlike the markets, business organisations have welcomed the approach but if the rest of the lab rats had been given a vote would they have chosen to test this risky drug?

Press release: nine in ten Scots anticipate a recession and worsening inflation

Press release from the David Hume Institute and the Diffley Partnership

30th August 2022

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Overwhelming majority say UK and Scottish governments have done too little to help with soaring prices, as nine in ten Scots anticipate a recession and worsening inflation.

New research produced in partnership between the David Hume Institute and the Diffley Partnership on economic attitudes and behaviours has revealed widespread anxiety and pessimism about Scotland’s economic outlook.

• 8 out of 10 people are cutting down on non-essential items and leisure, and over a quarter of people are skipping or cutting down on meals to save money

• 3 in 10 people in Scotland are now losing sleep over their finances

• The overwhelming majority think support from the UK (89%) and Scottish (73%) governments thus far has been insufficient

The Understanding Scotland survey found that 87% of people in Scotland expect the soaring cost of living to cause a recession, and more than nine in ten expect things to get worse before they get better.

Despite households’ best efforts to cut their outgoings, the support on offer from governments is widely seen as inadequate. 64% of people report feeling worse off now than over the past year, and 57% say their income does not satisfactorily cover their cost of living, rising to 73% and 71% respectively in the most deprived neighbourhoods.

Eighty per cent of people have cut down on leisure and/or non-essentials, and over a quarter of people are skipping or cutting down on meals to save money. Despite these efforts to economise, including by foregoing basic necessities, 89% and 73%, respectively, say that the UK and Scottish governments have done too little to help.

There is particular hostility towards energy companies: 95% of people think they have done too little to help people cope with rising prices, and a fifth of people think that the single biggest cause of soaring inflation is companies maximising their profits. This is only just behind the war in Ukraine at 21%, and ahead of pandemic-related supply chain issues at 12%.

Rising prices, in the absence of further support, have seen large numbers of people pushed into greater vulnerability and riskier behaviours. Two in five have depleted their savings, and over a third (35%) have taken on debt and/or borrowed money. The latter figure rises to 44% in the most deprived neighbourhoods, 20 percentage points higher than in the most affluent. 

The impacts of soaring prices are not being felt equally across society. Rather, they are hitting the already vulnerable hardest, with 73% of people in the most deprived fifth of neighbourhoods reporting that they feel worse off now than over the past year, compared to 60% in the most affluent areas.

While 80% of people believe that salaries and wages should rise in line with inflation, only a third say they would feel comfortable asking their employer for a pay rise and far fewer - less than 7% - have actually done so. Women, young people, and those in part-time work - already more likely to be in low-paid positions - are especially uncomfortable doing so. The ‘wage-price spiral’ counterargument - that higher wages only serve to drive up demand and inflation - does not appear to have much traction, with only 4% of people deeming this the primary cause of inflation. Only eight per cent of people believe that pay should not rise in line with inflation, a tenth of the proportion that said it should.

Reflecting on the findings, Mark Diffley, founder and director of Diffley Partnership who conducted the research, said:

“It is unusual to see the public mood being so unambiguously bleak. Financial pressures and anxiety at soaring prices are widespread across society, but particularly acute for those who are already most vulnerable. Across all demographic groups, and especially in more deprived communities, a clear majority are saying that the response to date from the UK and Scottish governments alike are simply not enough.”

Susan Murray, Director of the David Hume Institute, who collaborated on the survey, added:

“Since we started this survey, sadly most people have seen their financial situation deteriorate. With three in ten people now losing sleep due to financial stress, and over a quarter skipping or cutting meals, there are obvious consequences for the economy, labour market and people’s health. Eighty per cent of people have already cut down on non-essentials and leisure, and over a fifth have taken on or tried to take on more work, but it’s still not enough. Despite their best efforts, two-thirds of people say their money simply isn’t going far enough, and most expect things to get considerably worse before they get better. We need a concerted package of targeted support, and we need it now.”

ENDS

Notes to editors:

1. Designed by the Diffley Partnership, the survey received 2,227 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 4th - 8th August. Results are weighted to the Scottish population by age and sex.

2. About Understanding Scotland: Understanding Scotland is a quarterly survey tool measuring the most important facets of our lives and decision-making in Scotland: our society, economy, and environment developed by Diffley Partnership and Charlotte Street Partners. Understanding Scotland: economy is produced in partnership with the David Hume Institute.

Consultation response: public finances in 2023-24

Response from the David Hume Institute to the Scottish Parliament call for views on Scotland’s public finances in 2023-24 and the impact of the cost of living and public service reform.

About our submission

DHI welcomes the opportunity to respond to the Finance and Public Administration Committee’s call for views on Scotland’s public finances 2023-24 and the impact of the cost of living and public service reform.

Central to our work are the people of Scotland, including those who are seldom heard; from different ethnic and cultural backgrounds; different genders, ages and abilities. 

We apply the critical thinking which has long defined DHI to encourage action to address the contemporary issues of our time. 

Our response draws on a range of previous research including:

• The Action Project - the largest multi generational research project in Scotland in recent years heard from over 5,000 people about their thoughts on action to help Scotland build forward better.

• Our 2022 briefing paper on open data, which sets out the lack of progress on open data in Scotland and the cost to the economy and public services.

Summary

We call on the Committee to recommend that the Scottish Government:

• Maintain the essential focus on commitments to reducing child poverty and the transition to net zero is critical to the economy

• Fully implement the Scottish Government’s 2021 benefit take-up strategy

• Recognise that there is little evidence that tax cuts will help with the cost of living or inflation

• Work to reduce levels of ‘inactivity’ amongst those who want to work by reducing barriers to work in order to increase the tax base.

• Fully realise the benefits of their own Open Data commitments to improve public services and boost the economy.

• Better utilise the sustainable procurement duty to deliver national outcomes

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Blog: Another strategy launch, will it make a difference?

Blog by Susan Murray, Director, David Hume Institute

2 March 2022

Image credit: Photo by Ross Sneddon, free on Unsplash on 02/03/2022

It seems to be the time of year for governments to announce strategies.  However, as our hearts and minds are drawn to events in Ukraine, it can be hard to focus on domestic policy.

Cabinet Secretary Kate Forbes acknowledged world events at the start of the launch of the National Strategy for Economic Transformation (NSET) yesterday.  After months of meetings and consultations, there is a “laser focus on delivery” of Scotland’s new economic strategy.

This is good news but what will be different this time from previous economic strategies?  The biggest difference I observed is the focus on the interconnectedness of different policies and action, along with the role of women.

More women were involved in the development of the strategy and it's clear the government is keen to power up The Double X economy.  What does this mean?  It's not one action but lots of small ones to address structural inequality such as investor bias.

Linked to NSET is another Scottish Government strategy the David Hume Institute has been looking at in partnership with Open Data Scotland.  Our briefing paper on Open Data, released later this week, highlights a 2015 strategy with good intentions but a subsequent lack of delivery.

Lack of open data is a barrier we keep coming up against in our research and, from our conversations, we know that others are too.  Open data is a driver of economic activity estimated to be worth over £2bn to the Scottish economy.  It is fast becoming as much about data as mindset and culture in a country. It is an opportunity but one Scotland is failing to grasp and risks being left behind on.

Open data should be viewed as part of having a global outlook.  It is part of the UN Sustainable Development Goals which are the central operating principle underlying the National Performance Framework.

The UNSDGs are now a common operating language across the world for all sorts of organisations and the good news is the Welsh Assembly and the UK Government are signed up to them too. However, the UK Government Levelling Up strategy only had one mention of them - which seems like a missed opportunity for collaboration on shared goals across the UK.

A recent Westminster environmental audit committee evidence session looking at aligning the UK’s economic goals with environmental sustainability feels very relevant.  It is well worth watching both evidence sessions, including the hard hitting evidence from our partners, the Institute and Faculty of Actuaries.

The content of the evidence session was not new - what feels fresh is that the discussion is at the heart of Westminster at a time when business as usual is not an option. Whether it's the Levelling Up Strategy or National Strategy for Economic Transformation nothing works in isolation as we live in a deeply interconnected world.

So while the many policy brains wade through the reams of paper making up these new strategies, will they make a difference?

The answer to that lies with people – all of us make choices every day that impact on others both at work and in our personal lives.

What’s clear from reading Poles Apart by Ali Goldsworthy, is that everyone reading the strategies is doing so with a lens looking for confirmation of what they already believe. How many of us will change our actions and behaviours at a result of a new strategy - perhaps only time will tell?

DHI: The Movie

Thank you for being part of the Institute's journey in 2021.

This year we published research that brought people together from across Scotland to consider the actions required to move faster towards a more prosperous, sustainable, inclusive and fair country. Over 5,000 people from across Scotland told us their actions to help Scotland build forward better. You can read about these actions - and tell us yours - here.

From how to build A Scotland of Better Places, to delivering multi-year spending plans, and levelling up on Scotland's broadband, these conversations showed the appetite for change and transformation.

Throughout 2021 we have also been expanding our analysis of Team Scotland: diversity of thought is essential to improving productivity and resilience to risk - things that have proven to be essential in the 2020s. This year we turned our attention to actions for business and investment leaders, and Scottish Parliament.

This year DHI have brought you 11 insightful events on the economy, productivity and more. These are all available to watch now on catch up. We particularly recommend our most recent events on political philosophy and the pandemic, and our partnership event with Black Professionals Scotland and the Institute of Directors on how to unlock greater potential in Scotland's economy.

Scottish Government consultation response: tax policy and the budget

In autumn 2021 the Scottish Government sought views on the overarching approach to tax policy, through Scotland’s first framework for tax.

Our consultation draws on:

• The largest multi generational research project in Scotland in the last five years, The Action Project. In 2020-21 we brought together people from across Scotland to consider the actions needed to move faster towards a more prosperous, sustainable, inclusive and fair country.  Over 5,000 people from across Scotland told us their actions to help Scotland build forward better.

• We worked with partners to reach people of all ages and backgrounds across Scotland.  These included U3A, the Scottish Youth Parliament, the Children’s Parliament and local organisations like InspirAlba in Campbeltown and Resonate Together in Alloa. By listening to the many voices and then analysing themes and patterns, WhatsYourAction.scot presents the findings and encourages others to have their say.

• Our 2021 briefing paper on multi-year budgeting, explains how a new agreement on multi-year budgeting between the Scottish Government and Scottish Parliament will help long-term thinking and support a more open conversation about spending plans and investment choices.

• David Hume Institute events and discussions such as Talking Tax with Charlotte Barbour and Dr Arun Advani last year.

Summary

• DHI welcomes the framework.  The clear, accessible language is critical to create more understanding about the important role tax plays in society. Research conversations as part of the Action Project emphasised the lack of understanding of Scotland’s tax powers.

• Having a coherent narrative that joins up tax policy with the National Performance Framework and Climate Change Plan helps businesses and investors plan for the medium term direction of travel.

• Simplification and public understanding are rightly identified as important factors to underpin a fair tax system and are critical to accountability. The framework’s movement away from language like “tax burden” is important for a fresh conversation.

• DHI welcomes the proposed Citizen Assembly on council tax - this is an area that is widely recognised as needing reform but has become highly political. It came up consistently in Professor Duncan Maclennan’s work A Scotland of Better Places. Continuing the status quo indefinitely should not be an option and this work should be expedited.

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David Hume Institute gives evidence to Scottish Parliament committee

Susan Murray, Director of the David Hume Institute, gave evidence to the Scottish Parliament Finance and Public Administration committee following its response to the consultation on Public Finances in 2022-23.

The Institute is calling for Scottish Government to:

• Publish draft multi-year spending plans to help longer term planning for service improvement, investment and productivity, and increase transparency over forward planning.

• Publish how it has prioritised for a fair and equal recovery, and provide underlying evidence for those priorities, recognising trade offs between shorter and longer term choices.

• Link budget priorities to the National Performance Framework and the United Nations Sustainable Development Goals (UNSDGs), using them to analyse how the pandemic has affected some groups and communities worse than others.  Continued use of the UNSDGs assists collaboration with other organisations and governments around the world.

• Focus on climate action and a fair transition to net zero, faster delivery of digital infrastructure and measures to directly influence reductions in poverty and promote greater inclusivity.

• Work to improve Scotland’s places by devolving resources and putting more power in the hands of local communities.

• Ensure support for jobs where skills can be developed rather than skills development alone.

• Commit to a full review of the Fiscal Framework which considers external changes including the loss of European Funding and new direct spending in Scotland from Westminster as well as the interactions between both devolved and reserved taxes and social securities.

Scottish Parliament consultation response: Public Finances in 2022-23

Response from the David Hume Institute to the Scottish Parliament call for views on Scotland’s public finances in 2022-23 and the impact of COVID

About our submission

DHI welcomes the opportunity to respond to the Finance and Public Administration Committee’s call for views on Scotland’s public finances 2022-23 and the impact of Covid.

Our submission draws on evidence from:

• The largest multi generational research project in Scotland in the last five years, The Action Project. In 2020-21 we brought together people from across Scotland to consider the actions needed to move faster towards a more prosperous, sustainable, inclusive and fair country.  Through facilitated conversations with over 5,000 people, we identified actions which will help Scotland build forward better.
  

• Working with partners to reach people of all ages and backgrounds across Scotland.  These included U3A, the Scottish Youth Parliament, the Children’s Parliament and local organisations like InspirAlba in Campbeltown and Resonate Together in Alloa. By listening to the many voices and then analysing themes and patterns, WhatsYourAction.scot presents the findings and encourages others to have their say.
  

• Our 2021 briefing paper on multi-year budgeting, which sets out the enabling action needed for the Scottish Government to publish multi-year spending plans.

Summary

We call on the Committee to recommend that the Scottish Government:

• Publish draft multi-year spending plans to help longer term planning for service improvement, investment and productivity, and increase transparency over forward planning.

• Publish how it has prioritised for a fair and equal recovery, and provide underlying evidence for those priorities, recognising trade offs between shorter and longer term choices.

• Link budget priorities to the National Performance Framework and the United Nations Sustainable Development Goals (UNSDGs), using them to analyse how the pandemic has affected some groups and communities worse than others. Continued use of the UNSDGs assists collaboration with other organisations and governments around the world.

• Focus on climate action and a fair transition to net zero, faster delivery of digital infrastructure and measures to directly influence reductions in poverty and promote greater inclusivity.

• Work to improve Scotland’s places by devolving resources and putting more power in the hands of local communities.

• Ensure support for jobs where skills can be developed rather than skills development alone.

• Commit to a full review of the Fiscal Framework which considers external changes including the loss of European Funding and new direct spending in Scotland from Westminster as well as the interactions between both devolved and reserved taxes and social securities.

Image credit: sharing thumbnail image - photo by Chris Flexen free from Unsplash 22.08.2021.