SIC LEADER Gary Robinson is calling for power to raise some taxes locally to be handed back to councils during negotiations over Scotland’s constitutional future following the independence referendum.
Speaking after a full council meeting on Friday morning to discuss Shetland’s next moves following last month’s No vote, Robinson said he wanted the local authority to have control over non-domestic business rates and be given greater freedom over council tax.
Non-domestic rates were taken over by Westminster in 1994 and then devolved to Holyrood when the Scottish Parliament was created. Shetland gets back less than two thirds of what it collects in business rates – in 2010/11, for example, it took in £14.1 million but only received £8.7 million.
“We think it’s absolutely right and proper that that comes back to local authority control,” Robinson said. “The whole premise is to cover the cost of the service that you provide locally for industry, be that roads or something more in line with economic development.”
On Thursday, Scottish finance minister John Swinney announced that the freeze on council tax would continue for an eighth year.
While councils are reimbursed “to a degree” for endorsing the freeze, Robinson said there was a growing feeling that “we’re not being fully compensated” – though he acknowledged that the small number of rate payers meant even a 10 per cent rise in council tax would only generate “very minimal” extra cash.
At Friday’s meeting, councillors appointed a member from each ward to a sounding board to guide negotiations with the UK and Scottish governments on pledges made to the Our Islands Our Future (OIOF) campaign before the referendum.
The seven chosen are Steven Coutts, Alastair Cooper, Frank Robertson, Mark Burgess, Billy Fox, Michael Stout and Jonathan Wills.
SIC convener Malcolm Bell has written to the political parties involved in the Smith Commission, the body set up to look at more devolution to Holyrood.
The letter urges them to pursue “localism” and “not artificially and narrowly limit matters solely to whether powers should be transferred to the Scottish Parliament or not at all”.
The sounding board’s first meeting takes place on Tuesday, with time of the essence: a submission to the Smith Commission needs to be made by the end of October.
Robinson said he was encouraged by the mood music from Edinburgh and London since 18 September.
He reckons roughly 100 of the 165 pledges in the SNP government’s prospectus for the islands are still attainable. Local government minister Derek Mackay “has said he is keen to deliver as much as can be delivered in spite of the No vote – I find that encouraging”.
Meanwhile Northern Isles MP and Scottish secretary Alistair Carmichael has given “very strong messages of support” on behalf of the UK government and “said quite publicly that he wanted to see support for more devolution to Scotland”.
Council chief executive Mark Boden said the OIOF campaign “achieved something quite remarkable” in getting commitments from both governments: “How many other councils have achieved that?”
Boden said the SIC was having “serious and meaningful” conversations with the SNP government about funding of inter-island ferries and the specification of the next North Boats contract – talks that “we just wouldn’t have been having [before], so that’s real progress”.
Councillor Drew Ratter sounded a note of caution that, in a context of potentially UK-wide constitutional change, Shetland must not be “too parochial” or it risks “falling under the radar”.
While OIOF was about a specific wish list, Ratter feels the council should now look at “what framework [for local government] would best deliver what Shetland wants”.
“We’ve done it before,” he said. “We’ve thought about the single cheque for Shetland and the whole business of a refreshed, renewed, completely changed structure.”
Councillor Frank Robertson said the SNP’s offer to devolve 100 per cent of net income from the Crown Estate would have been “an incredible advantage’.
But he feels the present constitutional flux remains “probably one of the best opportunities Shetland has had since 1973”, when an all-party UK delegation visited the islands.
Shortly afterwards the ZCC Act came along, giving Shetland considerable control over the waters around the islands as a harbour board.
“[If] we could achieve something similar, through some devolution of the Crown Estate, that would be tremendous,” Robertson said. “We should remain alert to that – it would be one of the major factors for Orkney, Shetland and the Western Isles if it could be achieved.”
Robinson noted that seabed income only forms a small part of Crown Estate revenue – “its core business is onshore” – and he hopes a deal with Westminster could be struck.
“The Scottish Government made clear they would give us 100 per cent of net income, but very little in the way of control, e.g. to set rates,” he said. “It’s for us to flesh out the case to the UK Government… and see if we can offer a solution that’s in the government’s interest but also our own.”
Other councillors said making Shetland’s case to Europe on matters including fishing and state aid were a priority.
Wills pointed out that if there is a UK referendum on EU membership, as pledged by the Tories, “our successful local economy could be undermined quite rapidly”. This council and its successor “is going to have to be really well connected in Europe”.
For many years the SIC has grappled with state aid rules restricting its intervention in local industry. Robinson said he felt the European Commission was “willing to have a discussion”.
“A good case can be made to display that… investing in Shetland businesses is not going to skew markets given the cost of operating within and outwith Shetland,” he said.
Ratter agreed, but said past negotiations suggest that achieving change will be a “Struggle” and “if any of you think it’s going to be easy to win that you’ve another thing coming”.