Scotland’s money trees are making us poorer

Robin McAlpine

Is there no aspect of Scotland which isn’t there mainly to make the very rich richer? Is there no limit to how much the Scottish Government will bust a gut to increase the pace at which Scotland is asset-stripped by the wealthy?

I ask because last week the Scottish Government announced that we were going to be force-fed ‘PFI For Trees’. I shall only give you a quick explanation of the scheme here – if you want more detail on how its meant to work and why it isn’t the right approach for nature this piece by Andy Wightman will help you out and if you want to know about the economics and the finance networks involved this piece by Nick Kemp will give you the basics.

Lorna Slater has signed off on a deal to run a private finance project to secure what she claims will be an investment of up to £20 billion for nature restoration. Please do not get the impression that this is selfless act of generosity. It is not philanthropy, it is just another opportunity for Big Finance profit-gouging based on Scotland’s natural assets.

The Memorandum of Understanding signed by Slater creates enhanced routes for big equity funds to funnel money to rich landowners so they can harvest the complex system of grants which are in place to ‘incentivise’ the transition to Net Zero. That grant system was designed by the private equity sector which is now profiting from it.

In reality this whole system isn’t anything much to do with the climate crisis. This is just what the incredibly powerful big-finance sector does – it looks at anything that is happening and tries to work out the best way to repurpose it for their primary purpose. That primary purpose is funnelling more wealth towards existing wealth. They are, after all, wealth managers.

The result of this has been depressingly predictable. If you want to ‘lever in’ private finance you need to convert the thing you’re seeking investment for into a financialised asset (step one). Then you need to incentivise private finance to invest by increasing the profitability of the asset (if it was currently suitably profitable private equity would already be investing). 

The fastest way to increase profitability is by giving government subsidy to the investor. All of this has a simple economic consequences which is to inflate the value of the asset concerned – if it generates more profit it is worth more to its owner. 

This is precisely the philosophical approach taken to public infrastructure which resulted in the abysmal Private Finance Initiative (PFI) whereby new schools and hospitals were privatised and rented back to the public sector at extortionate rates (there were examples of hospitals where paying the rent cost five times as much as just building the hospital in the public sector).

But because this is PFI For Trees we’re not renting them back, we’re just handing the money over to the landowners – and that’s the ‘Carbon Credits’. The asset isn’t the tree but the land, so it is the land value which rises as a result.

This happened almost straight away. What that did was to price communities out of land, consolidate both the power and wealth of massive landowners and increase inequality as even more public money went to the super-rich and not public services. 

Actually, this is not quite right because communities were already priced out of land – Lorna Slater is pricing their children and their children’s children out of land. These might as well be the new clearances given their long-term impact.

For the last eight years the Scottish Government has been talking about land reform, but to all intents and purposes it has done a sum-total of nothing. Which means that because land wasn’t reformed but the price of (and so the affordability and so access to) land has been inflated, the Scottish Government’s track record is almost total anti-land reform.

That the power and wealth of the Duke of Buccleuch (and his ilk) is not only being increased at public expense, public money is being used to embed his hereditary right to keep the people of Scotland locked out of large portions it Scotland’s land forever.

It’s not just that this is all a catastrophe for Scotland’s long-term economic and social health, it’s that Scotland is becoming a global case study for exactly how elites are manipulating climate change to make the world a worse place. Seriously, Scotland’s ‘green lairds’ are being held up around the world as a dreadful warning to others.

That all of this is being done by one of the Scottish Green Party politicians who were complicit in forcing Scotland’s leading land reform expert out of the party because he did not entirely agree with their view on gender identity tells you pretty well everything you need to know about the current state of the Scottish Green Party.

What’s the solution to all this? I am sorry to be the bearer of bad news but Scotland doesn’t really have one right now. This is part of the reality check which is coming as it dawns on people that Scotland’s climate targets were effective a sham from the beginning.

Common Weal has done more work than almost anyone on how to get Scotland not only to Net Zero but well beyond. There is absolutely no question that Scotland can do this – with bells on. We could easily be the world leaders. That is what we showed in our Common Home Plan project, in substantial detail.

But when we launched that piece of work I said something very specific in my summary speech. I said that climate change is not an issue that can be ‘owned’ by any one nation never mind any one side of a political or constitutional debate in one nation. What we described in our work was how to do it on a technical basis. How to do it on a political basis was something which I said was for each side in the constitutional debate to explain.

Which is to say I know how all of this can be done (with substantial public profit) if Scotland is independent. But as a team we have tried to work out and to model what could be done under devolution. The answer is ‘not nearly enough – not nearly’. It’s not the environmental powers, its the tax and borrowing powers. You can do it under devolution but you can’t pay for it and you can’t recover your investment (which all goes to London in tax receipts).

Instead the Scottish Government has been pretending to meet its targets through magical means (mainly Carbon Capture and Storage, a technology which not only doesn’t work but which isn’t even being scoped as a serious possibility in Scotland just now). The rest is just administering schemes designed by the Westminster Tory Government in Scotland.

That’s what this is, Tory schemes being enthusiastically championed by the Scottish Government. The Scottish Government will argue that it has no choice, but if you read the Andy Wightman piece I linked to above you will realise that actually the rush to plant trees (the particularly profitable bit) is a really small part of what needs to be done.

In fact there is increasing scepticism about whether planting trees is a particularly helpful priority in climate change. Sure they capture carbon, but then they die and, unless they are kept in structural wood form for the long term, they decompose and release most of the carbon again.

We’re very pro-forestry at Common Weal because wood crops are a brilliant option for displacing much more harmful materials from construction (among other things). But that’s not what this is. This is basically a scam for the rich to monetise their land holdings and to open up new profit opportunities for private equity. It is questionable how positive the environmental impact will be.

What isn’t questionable is the social and economic effect this will have – and that is dire. Sometimes when you can’t do the right thing your best bet is simply to not do the wrong thing. This is a concept the Scottish Government has bypassed in its desperate attempts to shore up its unrealistic (for now) climate change targets.

Had the Scottish Government not trapped itself by rolling in the glory of targets it couldn’t meet, this might have been an option. It could instead have set out coherent plans for Scotland’s climate change needs and then focussed on explaining why this is not possible under devolution.

As it stands the Scottish Government is implementing hardcore Tory policies which will lock many more generations of Scots out of their own land. At the heart of all of this is not concern for the planet, it is vanity. 

(And while, I was finishing this it was announced that Lorna Slater is now pulling all public funding for Tool Libraries having previously told a meeting Common Weal attended that she believed it was private finance that should drive the transition to a circular economy. So brace yourself for her next PFI stunt, coming to a asset-stripped nation near you. Soon.)