LABOUR is right to condemn the SNP’s Growth Commission report as committing an independent Scotland to a “decade of austerity” — a manifesto, as Richard Leonard put it, for “cuts not growth.”

Since the general election, the SNP has been in a quandary over its future direction. Should it shift to the right to regain the dozen seats lost to the Tories in its tartan-Tory heartland in the north-east or move left to forestall further loses in the working-class constituencies of central Scotland ? 

The party’s Growth Commission report supplies the answer. For everyone on the left, it is a deeply disappointing document which, if not challenged, threatens to shift the whole balance of debate in Scotland towards the right — aligning the SNP, in terms of the party’s basic assumptions, with Ruth Davidson’s Conservatives.

As befits its primary author, Andrew Wilson, former SNP MP and deputy chief economist at the Royal Bank of Scotland to 2008, the Growth Commission report is entirely pro-big business in its basic assumptions.

An independent Scotland would put fiscal responsibility before anything else. Over the first five to 10 years it will cut the country’s deficit from over 8 per cent to less than 3 per cent of national output.

Even on the most optimistic growth forecast this would mean cuts — as high as £3 billion on current expenditure. 

Borrowing would also be strictly limited. The national debt should be no more than 51 per cent of GDP, much lower than the current British level, and taxes should not be raised either.

Corporation tax on business should remain at the (very low) UK level. And taxes on the rich are frowned upon.

Rates should “be sensitive to the behaviour of individuals and business.”

The Growth Report has been praised for its realism. Gone are previous assumptions that oil could fund Scotland into the indefinite future at $120 (£90) a barrel and bankroll an independent currency.

But there is another disquieting, almost cynical, side to this realism. Keeping the pound, relying on the Bank of England for fiscal rectitude and maintaining a “close and respectful relationship” has a very specific purpose.

It is to seek to exploit Britain’s withdrawal from the EU to secure “the relocation of financial services” to Scotland, a country in which “financial services” are “of greater importance” than in “any other country that has made a similar transition.” 

This is the document’s secret key. It’s a manifesto for a bankers’ Scotland.

Scotland, it asserts, “must be in the Single Market.” That’s why the deficit must go down and why the prescriptions for growth rely on “increasing trade and international ownership” — securing investment by large multinational firms. 

How is such multinational investment to be attracted ? By reforming the labour market along the lines of Denmark’s “flexicurity” model.

This involves a still more flexible labour market than what already exists together with a basic level of social security.

In Denmark this has meant increasing the retirement age to 69 and enforced workfare after three months on benefit.

It’s a far cry from Labour’s active industrial strategy outside the straitjacket of the EU Single Market: public ownership, state aid for strategic industries, a state investment bank to take stakes in key firms and the use of public procurement to ensure stable employment, in-depth training, collective bargaining and the elimination of blacklisting employers.

No wonder the Financial Times devoted a whole page to extolling the virtues of the Growth Commission report.

It is now up to the left in the trade union and labour movement to expose it for what it is.