Tim Worstall

Moonbat Conspiracy Theory.

Our friend Monbiot notes a conspiracy today. And he’s quite right, there was one, just not the one that he manages to uncover. Talking about the Skye bridge:

The bridge, in other
words, appears to have cost the public £93.6m. If we accept the
consortium’s account of how much it cost to build – £25m – we have paid
for it 3.7 times. Even this could be an underestimate: independent
engineers suggest that it shouldn’t have cost more than £15m.

Our Georges’ calculations quite ignore the effect of interest. On all long term infrastructure projects this is the largest part of the cost, so ignoring it does mean that one’s numbers are, ummm, incomplete? I seem to recall that another bridge, one run by the State this time, the one over the Humber, does not even manage to collect it’s daily interest costs in tolls (although I seem to recall that this debt was written off at some point). Still, that’s not realy the point, for as I explain here, there really is a scandal at the heart of this story, one which Georges, either through ignorance or his love of State action manages to ignore.

The bridge is in the Westminster constituency of Charles Kennedy, leader of the Liberal Democratic Party. The Lib Dems have recently entered into a coalition with Labour in the Scottish Parliament. Part of the price for this coalition was that the bridge would be bought by the State and the tolls dropped. The bulk of this cost will be met by English taxpayers, not Scots. It is a pure piece of electoral pork. Charlie boy gets support in his constituency by holding the Scottish Executive to ransom over the coalition and everyone spends taxpayer’s money to do so. That is a scandal, the sort of thing we did not put up with in days gone by, but hey, welcome to the Brave New World of devolution, coalition politics and their attendant corruption.

In

3 responses

  1. David Farrer Avatar
    David Farrer

    Tim
    You are of course correct about Monbiot’s ignorance of economics.
    The Lib/Lab coalition in the Scottish parliament isn’t “recent” however. It goes back to 1999 and I wouldn’t have expected the Liberals to give up their ministerial Mondeos if Labour had shafted them on the bridge issue.
    The financial arrangements between London and Edinburgh aren’t affected by devolution. The Scottish parliament gets to decide how to allocate the money previously administered by the Scottish Office. The Barnet Formula continues to erode Scotland’s higher per-capita expenditure on “identifiable” expenditure but it is by no means clear that the overall financial balance with London is a subsidy to Scotland. See
    http://www.alba.org.uk/
    under “Scotching the Myth” for more details
    This is not surprising given that Scotland’s per capita GDP is almost the same as the UK level, and indeed that of the EU (when it still had 15 members.)

    Reply
  2. David H Avatar
    David H

    “Scotching the Myth” is simply a tabloid attempt to muddy the waters. There is no academic rigour in this article, only a lot of conjecture and anectdotal evidence. The siting of the BBC headquarters in London, for instance, is treated as a de facto subsidy.
    The leading UK expert on UK government spending is Professor Iain McLeod, a Scot, who in his paper: The Fiscal Crisis (http://www.nuff.ox.ac.uk/Users/McLean/fiscalcrisis3.pdf) demonstrates that the Scots receive 30% more from devolved services than the English.
    Scotland is most definitely subsidised by England. How else could it be explained that Scotland has a GDP of 97% of the UK average and yet has the most generous welfare provision in western Europe? And the Barnett Squeeze, which David Farrer alludes to, does not exist. In fact, the public accounts deficit in Scotland has increased by several billion since 1999: http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2003/12/11/nscot11.xml

    Reply
  3. dave heasman Avatar
    dave heasman

    I seem to remember that the actual construction of the Skye bridge was attended by controversy at the time. Something to do with a Conservative donor getting the contract, the toll at £5 + being incredibly onerous, and the compulsory shutting-down of the competing ferry. I was a little surprised by this, as it was a Conservative government compulsorily reducing competition, but strange things happen once a party has remained in power over 10 years.

    Reply

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