My Orcadian Column 14/2/19

If the only things certain in life are death and taxes, for a political career mishandling of the latter can often lead to the former.

I have been reminded of such risks while watching Finance Secretary, Derek Mackay trying to defend plans for a workplace car park tax included in his recent budget.  Mr Mackay has been open about his serious misgivings regarding the car park ‘levy’, but insists it is the price he was forced to pay to gain Green Party support for his budget.

Interestingly, reports have emerged suggesting that Green MSP, Patrick Harvie had not mentioned the possibility of a tax on workplace car parking, before Mr Mackay brandished it as a ‘sweetener’ at the eleventh hour of negotiations. Certainly, unlike the tourist tax and Council Tax reform, it was not a demand Mr Harvie had previously been shouting from the rooftops.

And this is where the proposal for a car park tax starts to come unstuck.  Everyone accepts that, as a minority government, the SNP needs to reach agreement with other parties, although his approach to negotiations rather left Mr Mackay at the mercy of the Greens.  Similarly, most would agree that encouraging people out of their cars and onto public transport is an entirely legitimate aim of government in the interests of public health, the environment and even the economy.  Yet, plucking a plan out of thin air, without any due diligence or understanding of how the scheme might work, is not a recipe for achieving those laudable aims.

Over recent months, SNP Ministers and backbenchers have lined up to denounce the idea of workplace car parking charges. Some privately argued it would be a poll tax on wheels. All of which made the subsequent screeching handbrake turn more spectacular.

Mr Mackay admits to having done no impact assessment of the proposals, not even on the back of a fag packet. Over the next few weeks, however, he and his officials will need to produce options.

This approach, though, exposes Holyrood’s weaknesses.  With no revising chamber, it is vital that consultation takes place before bills are introduced to parliament and that Committees then have the chance to take evidence from experts on the detail.  Policy on the hoof is unwise, but legislation on the hoof is altogether more dangerous as it is more difficult to undo.

Ominously for the Finance Secretary, what little we do know about how the tax might work is already starting to unravel.  Mr Mackay announced that NHS workers will be exempt, but this has led to questions about why others are not eligible for similar treatment. Teachers, for example, or those in our police and fire services will wonder why they are different in the eyes of Scottish Ministers. What about other key public sector workers, who risk seeing any value from recent pay awards undermined? Likewise, lower paid workers in the voluntary and private sector will be nervous about how these measures might affect them. Meanwhile, in urban areas there is at least the prospect of public transport alternatives being available; in rural communities that may be less likely.

Last week, Deputy First Minister, John Swinney told parliament that the government was striking a blow for local authorities by giving them the power, but not an obligation, to introduce charging. This was ironic coming from someone who, in his time as Finance Secretary, presided over an eight-year Council Tax freeze that eroded the independence of local authorities and reduced their ability to respond to local needs.  Moreover, in announcing his budget, Mr Mackay added the potential revenue from car parking charges to the total he said was being made available to local authorities. At best, this was disingenuous.

With Councils under extreme financial pressure, however, many may opt to exercise this ‘freedom’. At that point, employers will have to decide whether or not to pass this on to staff or simply absorb the cost, making the whole thing a lottery.

Meanwhile, Mr Mackay faces the challenge of trying to persuade the public that a tax on workplace car parking is right and workable, having made no secret of the fact he believes it is neither. As they say, act in haste, repent at leisure. 

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