A truly independent Scotland would need a careful balance between public and private interests. While the private sector has a role to play, relying too heavily on it could undermine the goal of a wellbeing economy. A pragmatic approach is key to ensuring state control over essential infrastructure and services.
The Case for a Mixed Economy
Scotland’s economic future would depend on a blend of state and private-sector involvement. The government could use fiscal, monetary, and regulatory tools to guide resource allocation while ensuring that fundamental rights and social needs are met. Having a Scottish currency would be crucial to this process, providing the flexibility to manage economic policies without external constraints.
A mixed economy would allow for state investment in key sectors while leveraging private-sector expertise where necessary. This approach could be adapted based on industry needs, available resources, and long-term national interests. For example, if Scottish firms lack expertise in digital infrastructure, partnerships with foreign firms might be unavoidable initially. However, the priority would be to develop domestic capabilities over time.
Ending the Era of Private Finance Initiatives
One lesson Scotland could learn from the past is to avoid private finance initiatives (PFI). These deals, often involving large foreign-owned corporations, have led to costly and subpar infrastructure while generating excessive profits for private investors.
Public ownership of essential infrastructure should be the norm. Whether through direct state control or mutual ownership structures—including public-sector pension funds as co-investors—Scotland could ensure that public funds are used in the public interest. The state should not be dependent on private investors for the provision of essential services, particularly if it controls its own currency.
Prioritizing Local Business and Investment
The private sector in Scotland is diverse, including multinational subsidiaries, small and medium enterprises (SMEs), cooperatives, and partnerships. A smart procurement strategy could help keep economic benefits within the country while fostering local expertise.
- Large-scale infrastructure projects might require major firms, but contracts should include clauses favoring Scottish supply chains.
- Smaller projects could be awarded to local SMEs, ensuring that public investment supports community businesses.
- Contracts with foreign firms must avoid investor-state dispute settlement (ISDS) clauses, which allow companies to sue governments over profit losses.
Government procurement policies should focus on keeping profits in Scotland. By prioritizing contracts with Scottish firms, the government could reduce capital outflow to foreign-owned corporations and strengthen domestic industries.
Workforce and Skills Development
Scotland would need a highly skilled workforce to support its economic ambitions. While developing local expertise should be the priority, recruiting talent from abroad might be necessary in the short term. Offering Scottish citizenship or long-term residency incentives could help attract and retain skilled workers.
The education system would have to adapt to the country’s economic priorities, ensuring that graduates possess the skills required for critical industries. Government contracts could include provisions for apprenticeships and training, linking public investment to workforce development.
Regulating Private-Sector Involvement
If the private sector plays a role in delivering public services, there must be clear contractual obligations to uphold social and economic rights. This could include:
- Adherence to a living wage and recognition of trade unions
- Requirements for fair collective bargaining agreements
- Conditions to provide training and apprenticeships for workers
A national audit office could oversee contract execution and monitor public spending efficiency. A dedicated division for project management could ensure compliance, prevent cost overruns, and limit excessive profiteering by private firms.
Energy: A Key Sector for Public Ownership
Scotland’s energy industry is largely in private hands, but state control over critical aspects of the sector could be a game-changer. At the very least, the government should own energy networks and retain control over new energy infrastructure that it finances.
Private energy generation could continue, but the state should regulate the domestic energy market to prevent price manipulation. Shifting share ownership to public and mutual institutions could also help bring key energy assets under greater Scottish control.
A Long-Term Strategy for Economic Independence
Creating a wellbeing economy would be a gradual process. The state would need to take an active role in shaping Scotland’s economic landscape while ensuring that private-sector involvement aligns with national interests. Having its own currency would be essential, giving Scotland the flexibility to fund infrastructure projects, support local businesses, and maintain public ownership of key assets.
Scotland’s economic independence isn’t just about breaking away from the UK—it’s about building a system that prioritizes public good over private profit. That won’t happen overnight, but with careful planning, it’s possible.
