:00:00. > :00:00.remarks he makes from the factual context in which they're made. Thank
:00:00. > :00:14.you very much. Tonight on Newsnight Scotland, an
:00:15. > :00:19.independent Scotland would have to take radical measures to tackle
:00:20. > :00:23.income in equality. But is that the right target? And confused,
:00:24. > :00:27.apparently we are, we will hear results of a detailed poll on
:00:28. > :00:31.attitudes to independence. Good evening. The boffins at
:00:32. > :00:36.Stirling university have been looking at what an independent
:00:37. > :00:40.Scotland could do to lessen income inequality, the answer, it seems is
:00:41. > :00:43.not a great deal. Raising income tax or benefits would have a limited
:00:44. > :00:46.effect. In a moment we discuss whether Scandinavian levels of
:00:47. > :00:48.equality are achievable or even desirable.
:00:49. > :00:59.Stoic other part of the report. In an on
:01:00. > :01:19.The poor always with us, but who are the pure? Were these people pure? --
:01:20. > :01:23.poor. Is she pure? Debbie is working a short-term contract as a midwife.
:01:24. > :01:28.Husband is a scaffolder but even with two wages, it is a struggle.
:01:29. > :01:32.Obviously, the children are into various hobbies. We have to think,
:01:33. > :01:38.how many miles on my doing, and will likely able to get to work next
:01:39. > :01:41.week? It is very restrictive. Because you literally would not have
:01:42. > :01:48.been able to fill up the car until you get the next pay check?
:01:49. > :01:52.Absolutely. I the credit union set up a branch in Wesco bright eight
:01:53. > :02:03.years ago after the collapse of the fair tax savings scheme. You have
:02:04. > :02:06.elderly people making a choice as to whether or not to put the heating on
:02:07. > :02:16.or make a meal. Locally, we have a good programme, but even at
:02:17. > :02:19.Christmas, we had a local council opening schools to guarantee
:02:20. > :02:23.children got a hot meal. We live in a wealthy country and yet we have a
:02:24. > :02:28.divided between those that have and those that have not, and it is
:02:29. > :02:31.becoming increasingly wide. Today's report warns that tackling
:02:32. > :02:36.inequality in Scotland means more and tweaking tax and spend. Fiscal
:02:37. > :02:40.policy in itself is not a panacea for inequality. We need to think
:02:41. > :02:45.about having a strong labour market that pays decent wages, and offers
:02:46. > :02:49.decent training and progression opportunities for employees. And
:02:50. > :02:52.there are bound to be people that say that we will have more freedom
:02:53. > :02:57.to do that as an independent country. Undoubtedly, Scotland will
:02:58. > :03:05.have greater freedom to exercise policy levers and labour market
:03:06. > :03:09.levers and interventions as an independent country but it is not
:03:10. > :03:12.simple in the case of pulling a few fiscal switches after independence
:03:13. > :03:18.and suddenly having a Scandinavian style level of inequality.
:03:19. > :03:20.Politicians on both sides of the independence debate have,
:03:21. > :03:24.predictably enough, seized on the findings. It is an interesting
:03:25. > :03:30.report but it is concluding ultimately that reducing taxes or
:03:31. > :03:34.taking fiscal measures is not the way to deal with inequality. We are
:03:35. > :03:39.actually much better staying within the United Kingdom to do that.
:03:40. > :03:44.Having the ability to integrate tax and benefits to avoid the kind of
:03:45. > :03:48.property traps that people often fall into right now, making sure
:03:49. > :03:53.that we are focusing on preventative policies and reaping the benefits of
:03:54. > :03:56.those policies to reinvest in transforming society, these are the
:03:57. > :04:00.things that you do with the extra powers. But we have a yawning gap
:04:01. > :04:04.that we rich and pure that has been created under the Westminster
:04:05. > :04:10.system. The argument is that if we want to tackle that, it will not be
:04:11. > :04:14.automatic or easy, but we need the powers of tax and welfare to do
:04:15. > :04:18.that. But who says that we need to tackle inequality? What is wrong
:04:19. > :04:21.with having some people who are considerably richer than the rest of
:04:22. > :04:24.us? You need some level of inequality in the economy to give
:04:25. > :04:30.people the incentive they need to work and invest. But there is also a
:04:31. > :04:35.point where the level of inequality starts to have detrimental
:04:36. > :04:39.consequences on health and stress and levels of debt and so on. The
:04:40. > :04:45.point at which we reach that tipping point, there is a great deal of
:04:46. > :04:51.debate about. I've never known a food bank to open in Wesco bright.
:04:52. > :04:57.But there is. -- West job right. That is a situation that many people
:04:58. > :05:02.find themselves in. Struggling, trying to make ends meet. People not
:05:03. > :05:08.getting wage rises. The cost of living has dramatically increased.
:05:09. > :05:14.Fuel, rent, everything is going up. Nothing is coming down. One thing is
:05:15. > :05:18.coming down and that his wages. -- that is wages. You can demolish
:05:19. > :05:24.the slums and rebuild the cities, but perhaps reshaping society is a
:05:25. > :05:28.real challenge. I'm joined now from London by Duncan
:05:29. > :05:31.Exley, who is Chief Executive of campaigning think tank, The Equality
:05:32. > :05:38.Trust, and from Edinburgh by Ben Thomson, chairman of think tank
:05:39. > :05:45.Reform Scotland. There is a context to put this into. And it is a pretty
:05:46. > :05:52.big issue. The share of national income going to Labour rather than
:05:53. > :05:56.capital, which was rather stable, has been starting to shift since the
:05:57. > :06:01.1990s towards capital and away from labour income. In almost all the
:06:02. > :06:09.advanced countries of the world, and China, there is a huge international
:06:10. > :06:15.issue. There is, but the UK is one of the worst countries for income
:06:16. > :06:23.inequality. It is seven worse out of the OECD 34. -- seventh. We are
:06:24. > :06:29.reaping the problems of that. It is damaging our economy and damaging
:06:30. > :06:32.our society. It is damaging businesses and it means that
:06:33. > :06:37.ordinary people will have less of a chance to have the opportunity that
:06:38. > :06:41.richer people have. But economists are arguing over why there has been
:06:42. > :06:46.this change over the past 20 or 25 years. There are various
:06:47. > :06:50.explanations to do with the opening up of labour markets in China and
:06:51. > :06:54.the former communist countries, to do with advances in technology. To
:06:55. > :07:03.do with the weakening of trade unions. It is not obvious with these
:07:04. > :07:06.explanations are that there is a set of policies you could adopt that
:07:07. > :07:10.would affect them. There are some factors that are basically
:07:11. > :07:15.globalisation, but countries have a choice. Governments have a choice
:07:16. > :07:19.over what they put in place to respond to globalisation. If you
:07:20. > :07:21.look at Germany, they have put in place measures to concentrate on
:07:22. > :07:27.building up small firms, to encourage industries which bring in
:07:28. > :07:33.people who are skilled and where there are people who have decent
:07:34. > :07:37.pay, as opposed to what we have here which is one of the highest levels
:07:38. > :07:41.of people on low pay in the developed world. That is the sort of
:07:42. > :07:49.choice that governments can make when they are encouraging different
:07:50. > :07:53.countries. Perhaps one of the most interesting things about today's
:07:54. > :07:55.report was that usually all this discussion about inequality is to do
:07:56. > :07:59.with tax levels and the rest but they wanted to focus on, in the
:08:00. > :08:11.conclusion of the report, they said it is market incomes, in other
:08:12. > :08:14.words, before any income. Market incomes are more equal in
:08:15. > :08:17.Scandinavia than Britain. That raises a set of issues that are not
:08:18. > :08:23.being addressed. I'll agree with that. There are a lot of different
:08:24. > :08:29.factors that go to make up this. There were two interesting things
:08:30. > :08:33.from this report. If you take out the south-east and, the UK fares
:08:34. > :08:37.much better and is actually on the average of the OECD countries. It is
:08:38. > :08:41.not to say that we should not make it an aim to improve pay
:08:42. > :08:49.inequality, and also improve poverty. That is a separate thing.
:08:50. > :08:53.And not to say that we should not see growth in GDP as the be all and
:08:54. > :08:56.end all. When we look at the Nordic model, one of the things that people
:08:57. > :09:01.have to take into account is that it is not just economic factors. It is
:09:02. > :09:11.also a real different attitude and culture in Nordic countries, which
:09:12. > :09:16.are the best in the world. The measure of inequality is the lowest
:09:17. > :09:20.in the Nordic countries. Partly, that is to do with culture. And that
:09:21. > :09:26.takes a long time to change. I wonder, everyone quotes the
:09:27. > :09:29.Scandinavian countries, other is another fact about the Scandinavian
:09:30. > :09:33.countries, apart from them being equal, which is that they are among
:09:34. > :09:36.the richest countries in the world. When the UN looked at things like
:09:37. > :09:42.whether people were happy with their lives, the correlation with him
:09:43. > :09:44.rich, in a rich country, seemed much from her than the correlation with
:09:45. > :09:48.being in a country that was very equal. By and large, in rich
:09:49. > :09:57.countries, unequal like the United States, which is unequal, or whether
:09:58. > :10:02.it is Denmark, which came out as the most satisfied. There is an obvious
:10:03. > :10:05.benefit from being a rich country rather than a developing country.
:10:06. > :10:12.But if you compare rich countries with each other, the ones who are
:10:13. > :10:16.more equal the ones where they have fewer health and social problems,
:10:17. > :10:21.where the economies tend to be more stable, and where people tend to get
:10:22. > :10:26.along better with each other. Those societies are the ones that people
:10:27. > :10:30.say they prefer living in. These things are very difficult to measure
:10:31. > :10:35.in any adequate way. A lot of those things are quite easy to measure.
:10:36. > :10:39.You can measure life expect the sea and obesity and drug use. There are
:10:40. > :10:48.lots of measures you can have a look at. And when you look at those, and
:10:49. > :10:54.they are including us, and they come out better. The other aspect of this
:10:55. > :10:59.is that the debate in Scotland, and in Britain generally, about
:11:00. > :11:02.Scandinavia, is, oh my gosh, they are very equal and that is great and
:11:03. > :11:07.we want to be like that. But actually, of all of the OECD
:11:08. > :11:10.countries, the one with the fastest-growing inequality is
:11:11. > :11:14.Sweden, even though it is still a more equal society than ours. The
:11:15. > :11:18.debate in Sweden and Denmark is, well, we have got this society and
:11:19. > :11:25.it does not seem to be working. What can we hang onto? It is odd that
:11:26. > :11:31.three out of four of the Scandinavian countries are run by
:11:32. > :11:36.centre-right governments. There was about 70% of GDP in the public
:11:37. > :11:40.sector, now falling to 51%, broadly in line with the UK. One of the
:11:41. > :11:45.secrets they do have is that public sector power and the provision of
:11:46. > :11:48.the public sector is done at a much more local, community level, which
:11:49. > :11:52.is something that a lot of people miss. People are prepared to share
:11:53. > :11:57.more because they feel more part of their communities. All of education
:11:58. > :12:00.and health, by and large in Scandinavian countries, is not only
:12:01. > :12:06.done at a regional level, which would be similar to our regional
:12:07. > :12:11.councils, but pushed right the way down to municipalities. In Sweden
:12:12. > :12:14.there are about 300, which have real control. People feel more
:12:15. > :12:18.comfortable about being part of a real community which has power to do
:12:19. > :12:24.the things that they want to do. Briefly, one of the things the OECD
:12:25. > :12:28.identified was strong labour markets, countries with collective
:12:29. > :12:32.bargaining, strong trade unions to push wages at the end of the day,
:12:33. > :12:35.they say, to be more equal. Things like works councils and the way
:12:36. > :12:41.things are organised in places like Germany, do you think it's
:12:42. > :12:49.realistically within our capability in Britain to change what an effect
:12:50. > :12:53.of a culture of labour relations? A lot of those things have been things
:12:54. > :13:00.that, to be honest, some employers have got it into their heads that
:13:01. > :13:04.there are some big superstars, who deserve to be rewarded very richly
:13:05. > :13:09.and that the rest of us are basically costs to be reduced. They
:13:10. > :13:13.have sold that sort of idea to a lot of politicians and to a lot of
:13:14. > :13:16.investors and a lot of commentators. Actually, that's one of the most
:13:17. > :13:21.profoundly antibusiness things I can think of, because it means for most
:13:22. > :13:25.people, there is very little recognition or reward for hard work.
:13:26. > :13:29.There are means that can be put in place rather than just expecting
:13:30. > :13:34.people to change what they think, which is about working in a German
:13:35. > :13:37.model, where they have ordinary workers on the committee that's
:13:38. > :13:41.decide how much the top people get paid. So it brings some perspective
:13:42. > :13:45.to it. Those sorts of measures are ones that we could do here without
:13:46. > :13:49.any trouble. We have to leave it there. Thank you
:13:50. > :13:53.both very much. So, after what already seems like an
:13:54. > :13:57.eternity, discussing the finer points of Scottish independence, it
:13:58. > :14:03.seems little of it is having any impact on voters. Those are the
:14:04. > :14:06.findings from the latest Social Attitudes Survey. It suggests that
:14:07. > :14:13.what matters most is the money in our pockets.
:14:14. > :14:20.Being ?500 better off would convince more than half of voters to support
:14:21. > :14:24.independence with under a third against, conversely only a minority
:14:25. > :14:32.would say yes if they thought they'd be ?500 a year worse off. Here's the
:14:33. > :14:39.rub, less than one in ten agree with the 'Yes' campaign that they would
:14:40. > :14:45.be personally better off. A greater minority accept the argument that
:14:46. > :14:49.they'd be worse offer. Most feel it won't make any difference or they
:14:50. > :14:53.just won't know. Lack of knowledge appears to be a theme in this
:14:54. > :14:59.report. The campaigns have apparently left most people unsure
:15:00. > :15:04.what would happen in the event of independence, a six-point increase
:15:05. > :15:08.on the previous year. When you dig deep e, only -- deeper, only one in
:15:09. > :15:12.five say they know a great deal or quite a lot about independence, and
:15:13. > :15:19.a much larger number say they don't know very much or anything at all.
:15:20. > :15:22.It's difficult to predict which way the don't knows will turn, but a
:15:23. > :15:27.clear majority feel they should have the option of voting for a more
:15:28. > :15:37.powerful Scottish Parliament within the UK. The tricky matter for them
:15:38. > :15:41.is that this isn't an option. I'm joined by Professor John Curtice,
:15:42. > :15:45.who is research consultant at ScotCen Social Research, which
:15:46. > :15:50.carries out the Scottish social attitudes study. Very briefly, what
:15:51. > :15:54.we were talking about before, inequality, you've done research.
:15:55. > :15:58.Are there any noticeably different attitudes in Scotland about people
:15:59. > :16:02.being prepared to put up with higher taxes to get more equality than
:16:03. > :16:05.there are in England? Let me give you statistics from the survey out
:16:06. > :16:09.this evening, which casts doubt about the degree to which Scotland
:16:10. > :16:14.really wants more equality or thinks independence would bring more
:16:15. > :16:17.equality. Only 16% of people in our survey said that if Scotland as a
:16:18. > :16:22.result of independence the gap between rich and poor would narrow,
:16:23. > :16:28.we also now find that 52% of people in Scotland think that unemployment
:16:29. > :16:30.benefit is too high and puts off people from getting work, which is a
:16:31. > :16:36.record figure for Scotland. The truth is that Scotland has shared in
:16:37. > :16:42.what we know from UK social data, which is that people are tougher on
:16:43. > :16:49.welfare. Scotland is not immune from that change. OK. Now, your 500 quid
:16:50. > :16:53.question. I get the idea this is a proxy for the economy being
:16:54. > :16:59.important. You say to people, would you like more money, they generally
:17:00. > :17:03.say yes. Yeah, if that were all to the survey, you'd be right. But
:17:04. > :17:08.underneath those questions, which are yes, very hypothetical, is a
:17:09. > :17:13.crucial reality. That is that if people think that indeed Scotland's
:17:14. > :17:16.economy would be better under independence, which around a third
:17:17. > :17:22.of people in Scotland think would be the case, you're very likely, people
:17:23. > :17:26.say yes, we will vote yes. Conversely, if you think the economy
:17:27. > :17:33.is going to be worse under independence, then, 75%, 80% of this
:17:34. > :17:39.group say no, we will vote no. It's not just the hypothetical that
:17:40. > :17:42.reveals that the financial implications, economic implications
:17:43. > :17:47.as people perceive them make a difference, it's also they're clear
:17:48. > :17:50.in terms of the decisions that people have already made. There is
:17:51. > :17:55.no other issue which more clearly different hates those who have --
:17:56. > :18:01.differentiates those who are going to vote yes. I wonder if it's fair
:18:02. > :18:05.on the politicians, isn't it just the nature of the case, you can't
:18:06. > :18:08.imagine a case that the 'Yes' campaign could make for saying
:18:09. > :18:12.you're going to be ?500 better off that would be so cast iron that the
:18:13. > :18:16.'No' campaign would say, oh, my gosh, yes, you're absolutely right.
:18:17. > :18:20.Therefore people are going to be confused. If that's all we were
:18:21. > :18:23.arguing about, you might be correct. What we're arguing is that yes, the
:18:24. > :18:27.economy matters. It's crucial to voters. It's become more important.
:18:28. > :18:32.At the same time, there are lots of other things such as Europe, the
:18:33. > :18:37.currency, how you pay for child care, which politicians have been
:18:38. > :18:41.arguing about in detailed, abstract academic arguments. These seem to be
:18:42. > :18:45.passing voters by. Yes and no voters agree with Europe. Yes and no voters
:18:46. > :18:49.don't disagree about the currency. Yes and no voters don't disagree
:18:50. > :18:54.very much about the issue of welfare, including unemployment
:18:55. > :19:00.benefits. The point is the campaign is focussing on issues that are not
:19:01. > :19:04.central to voters' voters' interests. There more don't knows?
:19:05. > :19:08.There aren't more don't knows but plenty of people in the survey
:19:09. > :19:11.reveal that they have an idea of what they might want to do, but are
:19:12. > :19:18.not necessarily absolutely sure what they're going to do. Thanks very
:19:19. > :19:25.much. Tomorrow's front pages: The Scottish Daily Mail - first class
:19:26. > :19:31.monstering. Royal Mail chairman launches blistering attack on
:19:32. > :19:35.Salmond's divisive and sad independence plans.
:19:36. > :19:38.The Scotsman, Assad's mass killings are Syria's Holocaust. And the Daily
:19:39. > :19:41.Telegraph, Clegg's wife told him he let down women. That's all for
:19:42. > :19:43.tonight. I'm back tomorrow. Until then, from all of us on the
:19:44. > :19:56.programme, good night. Hello there. Last night fog was the
:19:57. > :19:59.issue. Don't it's rain. It will be a damp start across eastern parts of
:20:00. > :20:03.the UK. Gradually things improve. For most of us we'll settle into a
:20:04. > :20:06.reasonable day of sunshine and showers. There will be lengthy
:20:07. > :20:09.brighter spells across Northern Ireland. We will see a line of
:20:10. > :20:12.showers pushing into western Scotland, the last of the overnight
:20:13. > :20:14.rain clearing into the Northern Isles. In between we see brighter
:20:15. > :20:18.spells through the spine of Scotland and northern England. A few showers
:20:19. > :20:22.around, but they'll move through quite quickly. Brightness for the
:20:23. > :20:26.Midlands too. It might be a struggle for eastern most counties of
:20:27. > :20:29.England. The overnight rain only very gradually easing away. It stays
:20:30. > :20:32.chilly here. In the brighter spells, further west, temperatures will
:20:33. > :20:35.respond, up to eight or nine degrees. The breeze shouldn't be too
:20:36. > :20:39.strong. There will be showers around. They won't last that long
:20:40. > :20:40.and there's a good chance where you are, you'll avoid most