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Mr Scotland, chauvinism and the SNP’s big-tent nationalism

In Edinburgh, Alex Salmond walks with the swagger of a man who feels that these could be the last days of the Union.


Throughout my time in Scotland I was asked, again and again, the same question, rhetorically or otherwise: can anyone stop Alex Salmond? At present, the Scottish National Party leader and First Minister seems pretty much unstoppable. A cult of personality exists around him. He is the Big Man, without political equal or rival in his homeland. He moves with the buoyancy and swagger of one who feels that these could be the last days of the United Kingdom.

Many of his old adversaries - Donald Dewar, Robin Cook, Jim Wallace, Jack McConnell, Gordon Brown - are dead or in retreat. He is the leader of the new establishment in Scotland, a formidable machine politician with the stamina, tenacity and opportunism of a Latin American charismatic. He is a kind of pale-faced, northern European Lula da Silva and his pro-market social-democratic populism, as with Lula's in Brazil, is proving to be very appealing to a Scottish electorate that had grown weary of Labour's client state and its entrenched culture of cronyism, and which long ago gave up on the Conservatives.

“When a Scotchman sets out from this port for England," Dr Johnson once said to his biographer James Boswell of the Firth of Forth seen from Edinburgh Castle, "he forgets his native country." It was never so for Salmond: during his years of exile in London as an MP he did not stop believing that he could break the British state and create an independent Scotland. For Salmond, Scotland was a proud nation without a state, if not quite a colony of imperial England's then an inferior partner in an unhappy union: exploited, condescended to. This was the grievance that fired his restless ambition and gave definition to his complaints. In politics it always helps to have conviction, as Margaret Thatcher did, and to believe in something big; to have a project and a clear and defined enemy. For Salmond, the enemy is England and the British state.

The SNP leader has never been in a hurry. He is a gradualist. He knows where his journey ends and where he wishes to plant his flag of victory - through the heart of the last British prime minister. But he knows, too, that most Scots remain sceptical of full independence, which is why in these early skirmishes over the 2014 referendum he is being flexible and pragmatic, cravenly shifting his position on the EU and the euro and exploring the possibilities of a third way between the status quo and independence, between a straight yes and no.

He operates with the freedom of one who knows that there is no one commanding opponent to challenge him - at least not yet. David Cameron, so nimble in a crisis and so fluent, is the only politician in Britain who could be his match but he has larger problems: in spite of his Scottish surname, he knows that as an upper-middle-class English Conservative - Eton-educated and plummily poised - he would in all likelihood be received with derision in Scotland as and when the time came for him to go up against Salmond in the pulpit.

Then there is Gordon Brown, who keeps his silence at home in Fife. "He's lost confidence," I was told by one of his former aides. "He keeps asking himself - 'What was that all about?' He can't quite believe what has happened to him and to Labour." Brown holds Salmond in as much contempt as Cameron and George Osborne do. But they have power and he doesn't; they ultimately won and he lost.

The scale of the defeat in the Scottish Parliament election of May 2011 was a shock from which Labour has not recovered. The proportional voting system was set up in Scotland - or rigged, if you will - to prevent any one party from achieving the kind of majority won by the SNP, and with it a mandate to hold a referendum on independence.

“The SNP victory took me completely by surprise, which feeds into a more general lack of awareness of what was happening in Scotland," Johann Lamont, elected as leader of the Scottish Labour Party in December, told me when I visited her at Holyrood. "We did not recognise what was happening to the Labour vote nor the way in which the SNP were positioning themselves, being both left, right and centre. And actually, they were putting a triple block virtually on the question of independence. It is their only policy, but that wasn't their message . . . We did not recognise the scale of the challenge in taking on a party which had constructed a coalition that included Tommy Sheridan and Brian Souter [a businessman and Christian fundamentalist]. So there is no politics there actually. This is all about identity and who is Scottish. I don't think in all honesty the Labour Party ever managed to include someone from the ultra left [Sheridan] and someone who is a right-wing homophobe [Souter]. Yes, you can strike coalitions, but if they are based on principle and politics."

For Lamont, Salmond is not a social democrat: he's a single-issue opportunist. "Are they a social-democratic party? Some of them are. Alex Salmond isn't. I think he said: 'I don't have a problem with Thatcher's economics, it was the social consequences I have a problem with.' Why would you make a distinction between the two? How can you separate off a decision to destroy the mining industry and then be sad because the mining communities have been destroyed along with it? One of his key advisers, George Mathewson, is a Thatcherite.

“What is my problem with David Cameron? He is a Tory. What is Alex Salmond's problem with him? He's English. I don't mind people being nationalists. I worry when it trips over into chauvinism and I'm frustrated when it becomes a substitute for arguing about real politics."

On the issue of independence, Lamont says that Salmond "wants it to come down to a fight between himself and the Conservatives. Alex Salmond wants to say that those who disagree with him are talking down Scotland, that our vision of Scotland within the United Kingdom is a conservative one. He is making arguments for us that we are not making . . . Alex Salmond wants to be Mr Scotland. But he is not trying to separate us all from some kind of colonial empire. It is a partnership. There will be a Labour campaign that will be making the point about why you would want to stay strong within the United Kingdom." As for Salmond, "If he gets into a place where it looks as if he is trying to fix things, or be canny or clever, or whatever, that will damage him. And a lot of people in Scotland don't agree with him."

We will find out for sure soon enough.

Jason Cowley is editor of the New Statesman. He has been the editor of Granta, a senior editor at the Observer and a staff writer at the Times.

This article first appeared in the 30 January 2012 issue of the New Statesman, President Newt

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.