Derek Mackay: 'I can't stand personality politics'

Derek Mackay can’t escape comparisons to science-fiction characters, it seems. 

Last year, Holyrood compared Scotland’s finance secretary to Star Trek’s Mr Spock, conjuring improbable solutions for enterprise. Fast forward 12 months, and this year’s budget has all been about him playing Dr Who, regenerating the economy.

The comparison stemmed from a newspaper interview where, apparently, he compared himself to the time-travelling alien, but it is a claim Mackay disowns to Holyrood.

It was a response, he insists, to the interviewer comparing his style of speech delivery to “a constipated Dalek” a year ago.

If Mackay found the slur on his oratory hurtful, he isn’t letting it show.

“I found it… OK, funny, but it did give me some cause for reflection,” he grins. “I just said in response that I’m not a Dalek, I’m not here to destroy, I’d rather be the Doctor.”

One of the incarnations of Doctor Who, of course, David Tennant, was born in Paisley just like Mackay, and like Mackay, has somewhat of a cheeky chappy persona, but he refuses to get drawn into the comparison. 

“I’m sorry to disappoint, I’m more of a Star Wars fan,” he laughs. 

One of Mackay’s big pleasures is taking his two sons, 14 and 11, to all the films, he says. He also cheekily compares an unnamed civil servant to the comically-neurotic golden translator robot C3PO.

But if Derek Mackay is not Dr Who, nevertheless he has undergone a regeneration of a more personal nature in recent years. 

In 2013, he came out publicly as gay, after telling his wife of 12 years, something he has described as “the most difficult thing I’ve ever had to deal with”.

He has since been able to continue a strong relationship with his family, while rising up the ranks of government. 

His handling of the chaotic temporary closure of the Forth Road Bridge in 2015 as transport minister had impressed the leadership enough to see him promoted to the finance brief the following year, and in Nicola Sturgeon’s last reshuffle, the role was expanded to include business and the economy, making him Scotland’s most powerful finance secretary yet.

Now buying a house with his long-term partner, Mackay says he is “certainly more comfortable in my own skin”.

“Everyone is still learning and on a personal journey. I have enjoyed all the government portfolios I’ve had, but I do have something of a dream job at the moment,” he says.

Mackay insists that what has remained constant, from his turbulent childhood in Renfrew  to a political career which saw him elected Scotland’s youngest councillor at 21 in 1999, leading Renfrewshire Council through the financial crash then becoming an MSP in 2011, has been his resilience.

“I was a council leader post-financial crash in 2008, so I’ve dealt with being in public office in challenging times. Did it finish my career? No, it didn’t, I went on to other things. 

“The crisis over the Forth Road Bridge, in the face of that adversity, I got through it. That resilience, that attitude, that spirit, even in difficult times, has carried me through. 

“I am told it was the handling of such a crisis that may have been the reason others thought I was fit to be in the cabinet.”

However, last year’s expanded job meant that he had to step down as the SNP’s business convener, a job he had held for seven years.

“The First Minister was very clear with me at the reshuffle that she wanted me to focus on finance and the economy, and make sure we are doing everything we can. I think it is right I focus on that.”

As someone who describes himself as “SNP through and through”, clearly the role of party chair was relished by Mackay, though.

It was an eventful seven years too. The party grew fourfold after the 2014 independence referendum, making Mackay “terrified at the prospect” of planning party conferences in arenas rather than town halls.

by Jenni Davidson

Number of financial technology firms triples in first year of FinTech Scotland

“I have to say, it was the same people who were my nemesis, even with three thousand extra members there,” he says.

“It was a thoroughly enjoyable period of time. There’s a lot of pressure to make sure the party is well supported as business convener, and you’ve got a sense of loyalty to it and all the people within it, and the cause.”

The influx has led to a new party constitution and Mackay highlights other internal reforms, like those to ensure more women are elected to office, which he says he is “very proud of”.

“The party is a big family to me, so being chair of the party has been an honour and privilege, it really has.”

The last few months, though, have been more about “mixing with the titans of Scottish business”, he says, ahead of a budget Mackay claims will protect Scotland’s economy from UK Government austerity and the fiscal fallout from withdrawal from the European Union. 

If the UK crashes out without a deal then the spending plans will clearly have to be revisited.

In the meantime, though, it seems winning the necessary support for his minority government budget could be a more difficult task than in previous years, when the Scottish Greens could be counted on for support in exchange for some more cash for local government.

Last year, they were joined by the Liberal Democrat MSPs who represent Orkney and Shetland, Tavish Scott and Liam McArthur, after the Scottish Government pledged to fund the inter-island ferries.

This year, however, the Greens and Liberal Democrats have drawn more obstructive red lines. The Greens demand meaningful reform to local taxation, something which has been oft discussed at Holyrood but without agreeing an alternative to the council tax.

In 2005, a Scottish Socialist Party bill to introduce a local income tax failed to win the support of MSPs, but both the SNP and the Liberal Democrats went on to include a version in their 2007 manifestos.

Indeed, legislation by the first SNP minority government was planned, only for the UK Labour government to kibosh the idea by threatening to withhold council tax benefit cash.

In 2019, Mackay is keeping his cards close to his chest, but insists he has already had “constructive engagement” with the Greens.

“In the two years I’ve been finance secretary in a minority government, agreement has been reached just in advance of Stage 1 – that’s actually the end of January. 

“The fact I’ve engaged in discussions with the opposition parties earlier is just because I’m trying to give both stability and stimulus to the country. I embarked on the discussions earlier.”

The changing nature of the way the Scottish Government is funded, including more powers over taxation, has made such considerations more complex, he says.

“The public might not be too interested in the wiring board, but they want the right outcomes. That’s absolutely what I’m focused on. You’re well aware of what my position is on the budget – stability, stimulus, sustainability.

“What’s at risk here, though, is £2 billion of extra investment in services and infrastructure. That’s what is at risk if the budget doesn’t go through.”

Mackay rules out dealing with the “unrealistic demands” of Scottish Labour and the “tax cuts” of the Scottish Conservatives. 

“I’m not just going to photocopy the Chancellor’s budget. That’s his manifesto, not mine, and I’m certainly not going to follow their economic policy.”

But given the budget already contains many of the things the Liberal Democrats have been advocating – an uplift for colleges and mental health, more for the islands – surely there could be an opening there? 

Leader Willie Rennie’s red line is for the SNP to rule out a second independence referendum in two years, but how likely is that to happen? Couldn’t Mackay simply say that independence was going to be central to the party’s 2021 manifesto anyway and get an easy win for his budget, without having to tackle the thorny issue of local taxation?

Mackay says Rennie is trying to “out-unionist the ultra-unionists” with his demand.

“What the Liberals are asking us to do, and I suppose the Tories are as well, is to just drop independence temporarily,” he says. 

“How would Willie Rennie respond if I said, ‘how about you drop your campaign for a people’s vote, a second referendum on membership of the European Union’? 

“As it happens, I wouldn’t, because I want to remain a member of the European Union, but if I was to ask him to change his opinions just to get a budget through, it would be absurd. Surely the budget should be about the contents of the budget. That’s what he’ll be asked to vote for, and he shouldn’t get a party of principle, a movement with a cause, to drop that cause.”

He suggests the position will not help the Liberal Democrats gain public support.

“The question is, see when the opposition get what they’re asking for, surely there’s an onus on them to then vote for the budget? Don’t play games with a £40 billion budget. There’s enough games going on in Westminster right now. Can we not show the Scottish Parliament as a place of calm competence?”

Interestingly, it was the Liberal Democrats that Mackay shared power with when he led Renfrewshire Council. 

“I came from quite a tribal background in Renfrewshire. It was very tribal politics, it really was. I helped on the journey to make us [the SNP group] a team that others could work with; more pragmatic, more constructive and collegiate, to a point where we could work with the Liberals. Interestingly, it ended up that half the Liberals in the administration then defected to the SNP, such was the power of persuasion.”

But the new administration was quickly hit by the aftermath of the banking crisis, which saw the young Mackay having to manage a decline in funds.

“Dealing with inefficiencies and [the] public sector challenges we faced, with huge expectations on the public sector as well, I learned how to deal with all politicians. 

“I always try and look at an argument from someone else’s point of view. I absolutely can’t stand personality politics. I’m interested in ‘what are your issues and what are your asks?’

“And I hate it when there’s game playing, just get on with what you believe, what you want to do. The art of the possible.”

While Mackay sees his cross-party budget negotiations as the art of the possible, councils are telling him he asks the impossible.

Councils umbrella body COSLA said his settlement for local government could lead to job losses and “put the final nail” into communities and essential services.

Analysis by the Scottish Parliament Information Centre revealed that rises in the total spending on local government in the 2019-20 budget is mainly coming through ring-fenced funding for social care and the expansion of early learning and childcare, while councils’ revenue budgets are seeing a £319m real-terms cut.

Given his own experience when the current fad of austerity politics began, doesn’t he have some sympathy for the current crop of council leaders?

“I actually do have sympathy with local government, having come from local government. I mean, I had to do challenging things when I was a council leader to balance the books, but we were also prioritising. 

“There are many things I did as council leader that prioritised investment, in housing, roads, environment, social care. We built new schools and refurbished schools, but we did have to take tough decisions. It was a balance, but I had to prioritise, and right now, local government will have to prioritise.”

Mackay insists that he has not “passed on Tory cuts” and that the overall settlement is up, but Holyrood asks if, as a council leader, he would really be happy with a minister telling him how to spend his money.

Mackay insists the ring-fenced funding is for joint priorities, areas local government asked for help in, pointing to 15 SNP council leaders elected on manifestos built on “housing and early learning and childcare entitlement”.

Of course, when it comes to the art of the possible, the ultimate question for those in the SNP is Scottish independence, and although Mackay is reluctant to put a timescale on a second referendum, he suggests the party will call it “when we can win it”.

As a member of the Sustainable Growth Commission, Mackay had the opportunity to shift focus from Scotland’s real GDP and play about with the much-vaunted ‘levers’ over the economy the party only dreams of.

Looking at international comparators from Hong Kong to Ireland, the report concluded that whatever macro-economic model the country opted for it would be more ‘agile’ as a small independent nation.

“I think if we had that degree of control we would be in a better financial position,” says Mackay. 

“Why do I say that? Because right now, the economic forecasts for the UK are the most subdued in Europe and Scotland is subdued as part of that.”

This will be exacerbated by UK immigration plans which fail to recognise Scotland’s shrinking working-age population, he adds.

On recent GDP stats which show very slow growth in Scotland, Mackay is more upbeat, pointing to five consecutive quarters of economic growth. But given he has labelled his consecutive budgets “pro-growth”, there must be frustration that economic growth and business activity are slowing, Brexit or not.

Mackay says it is too early to measure the impact of the revised income-tax regime, but insists enterprise investment has made a difference. Changes to property taxation, too, will make Scotland attractive to small and medium-sized enterprises, he says.

His approach sounds more like old-fashioned British Keynesian economics of tweaking and regulating than the Nordic aspirations of the 2014 referendum or the tiger economies lauded in the Sustainable Growth Commission. Is Scotland really doing anything different than the UK economic model?

“Yes, it is. I was at an Edinburgh brewery this morning, discussing the GDP stats. It was a couple from England who moved here to Scotland. What they said to me was, ‘we’ve come to Scotland because we like the quality of life. We like the attitude. We like the product, you’ve got something unique here.’

“Enterprise and support for export, in their words, it just doesn’t exist like that south of the border. We’re willing to invest in that, to give extra support, a competitive edge. They appreciated that, the incentives that exist in Scotland.”

The divergence with the UK will continue, he predicts.

“I think where the UK appears to be, partly because of the Brexit debate and where they think they have to position themselves, is a race to the bottom on tax. I take a different view. I want Scotland to be competitive in terms of taxation but I want us in the race to the top in quality. Quality of life. Quality of place. Talent pool. Skills. Investments in innovations and infrastructure. I think those values appeal to a lot of people, business as well as the population at large.”

This ‘progressive agenda’ is also recognised on the world stage, Mackay suggests, with the UN set to re-establish a training base in Scotland because of its interest in the Scottish Government’s National Performance Framework. UNICEF will also open a data lab at Edinburgh University.

“I think Scotland is known for our progressive agenda. The most ambitious climate-change targets in the world. The sense from the Enlightenment of investing in education. We believe in investment in education. Free education. Protecting our public services. And actually, being internationalists, looking at the evidence in terms of the European dynamics, being pro-European, and socially liberal as well. Of course, we were a parliament that supported equal marriage with a huge majority so I actually think we are on the international radar.”

He adds: “If organisations such as the United Nations respect and know of Scotland’s social mission and progressive values then I would argue that we are charting a quite different course. 

“I mean, what did the United Nations say about the UK Government and their pernicious welfare policies? That they were cruel and driven by ideology not financial necessity, in terms of ongoing austerity. 

“So we are choosing investment in our people, a social contract and divergence, compared to the cruelty of the austere fiscal regime that the UK Government is wedded to. They throw into the bargain a dislike of immigrants as well. Yes, we are diverging. 

“I would say the force is strong with Scotland, yes, and the dark side is in Westminster.”