The Scottish Government continues selling off scottish assets
One of the major themes for Common Weal’s policy output this year has been our campaign for Scotland to bring our renewable energy resources into public ownership. It started this year with the Scottish Government denying that it was even possible - something that we thoroughly debunked. This entire campaign follows on the heels of us highlighting the problems being created by the high levels of foreign ownership in the Scottish economy which has led to some of the highest levels of outwards profit extraction in the world.
This week, the Scottish Government has apparently responded to these two campaigns by announcing a new tranche of selloffs of the Scottish energy sector to foreign investors under the guise of “InvestScotland”.
This is a “new portal” designed to showcase the best that Scotland has to flog off to anyone in the world (except within Scotland) and includes renewable energy projects like Coire Glas - a proposed pumped storage hydro power facility in the Great Glen.
Housing projects are also on the wish list for selling off Scottish assets. Just a couple of weeks ago, we revealed how the financialisation of the housing sector has led to you paying an average of £70,000 more for your house just to pay for the profits of the developers and the dividends to their shareholders as well as the interest you pay to the banks to finance the extra loan you need to pay for those dividends. Housing investment firms moving into Scotland may well include bodies like the Canadian public sector pension fund that already owns Glasgow Airport and has just settled a years-long dispute with tenants in houses it owns after complaints about high rents and poor service records.
Also up for sale is Kishorn Port in Strathcarron - one of Scotland’s largest dry docks, an important oil and gas hub that is currently being retooled into servicing offshore renewables and which is described by the Scottish Government as “one of Scotland’s most strategically important deep-water facilities”.
In a world of increasingly fraught and fragile geopolitical world, one might question the wisdom of selling off specifically strategic assets when the buyers may be tomorrow’s adversaries or even today’s unreliable allies.
The Scottish Government has gone all-in on “foreign direct investment” as a means of boosting Scotland’s GDP but our Profit Extraction paper has shown the other side of this folly - investments always demand a return. Either these investments will fail and the global investors will move on leaving Scotland to pick over the scraps or they will succeed and Scotland will see the profits of those investments flow overseas - further draining Scotland’s ability to reinvest those profits in the future and making us even more reliant on those unreliable allies.
As we’ve seen here though, this policy goes far beyond mere profit and loss. Selling off of strategic assets like ports and energy, or foundationally economic assets like housing, leaves Scotland with a far more fragile and more vulnerable economy and one that is far more dependent on economic forces that are not accountable to our democracy.
The Scottish Government must start valuing Scottish assets not merely based on making the GDP line go up or making Scotland ever more “attractive” to foreign investors but must start ensuring that the economy works for the people who make it what it is.