Charlotte Street Partners



A very Scottish election result

Written by Alex Massie, correspondent-at-large
News round-up by Javier Maquieira, senior associate
10 May 2021

Good morning,

Elections are typically considered clarifying moments; occasions when the will of a people, of a country, is made clear and new futures, dizzying in their possibility, suddenly become apparent. But this is Scotland and we organise matters differently here.
For although this was an election with one obvious winner it was also one without many, if indeed any, obvious losers. The SNP have won another mighty endorsement and retain their position as Scotland’s natural party of government. Nicola Sturgeon is trusted by the people in ways no other politician has been since this Scottish parliament was established in 1999. Alex Salmond won a larger victory in 2011 but his majority was an accidental one in so much as no-one, even in the SNP, thought it likely before the votes were counted. Had the people been aware it might happen, some of them might have voted differently.
And yet, despite all that and even though the SNP won this election at a canter and can look forward to governing Scotland for the thick end of 20 years, much of this was priced-in before the votes were cast, let alone counted. Sturgeon has twice attempted to emulate Salmond’s 2011 achievement and twice come up short. Not by a lot but by enough for it to be noticed and to count. The SNP won 63 seats in 2016 and 64 in 2021. That is not a transformational advance and no amount of blather about “historic” or “record-setting” victories can make it so.
On Friday morning, Sturgeon tried to claim no-one had ever wasted any time contemplating an SNP majority but this, I am afraid, is not entirely true. The party certainly had some aspirations on that front. They did not fall short by much but they did fall short, and so while it would be absurd to consider this a disagreeable result for the nationalists, it is entirely reasonable to point out it was not quite the result of their dreams.
For the Tories, however, this was indeed the stuff of near-fantasy. They entered this election with 31 MSPs and they leave it with precisely the same number of representatives at Holyrood. Few folk truly thought that possible, let alone likely. In the circumstances, then, this result is a great success for Douglas Ross. He may not be Ruth Davidson but it turns out that, at least in this election, he didn’t need to be, for Nicola Sturgeon remains Nicola Sturgeon and that is truth enough to rally the Tory vote.
As for Labour, it is tempting to look at the discrepancy between how Anas Sarwar was judged to have conducted himself in this campaign and the number of seats Labour won and conclude that this was yet another false dawn for a new Labour leader greeted with more enthusiasm by the commentariat – people like me, that is – than the electorate. Labour lost two seats so this is a view which evidently merits some respect.
Despite that, the hole in which Labour finds itself is probably one which requires three elections to escape and, viewed in the longer-term, Sarwar’s improving approval ratings may count for more than the loss of a couple of MSPs whose presence in the parliament would make little difference one way or the other. If, albeit in rather different ways, Nicola Sturgeon and Douglas Ross are each value stocks, Sarwar may be a growth one enduring a rocky beginning. That’s the glass half-full verdict, anyway. Labour people believe they have glimpsed a better, more relevant, future and while optimism is often worth shorting one should not presume it always should be.
If you had offered the Greens eight seats eighteen months ago, they would have been happy to take that but it is a measure of how their own hopes were inflated during this campaign that this is a return that is both wholly satisfactory and mildly disappointing. It is both very good and not quite as grand as they had hoped for. An advance, certainly, but not quite the breakthrough they had hoped for. I confess that this does not disappoint me very much but then I think hostility to economic growth – and hence an implied preference for national impoverishment – should be a more niche enthusiasm than seems to be the case.
All of which leaves Willie Rennie and his gallant, if outnumbered, band of Liberal Democrats. A party, indeed a sensibility, which once dominated Scottish politics is now reduced to being competitive in precisely five constituencies – and two of those are Orkney and Shetland. This is a sad business in many ways but there is, I suppose, some consolation to be drawn from the fact the Lib Dems won 80% of the seats it targeted. (That is a very “Lib Dem bar chart” way of putting it, of course.)
It seems to me that Rennie, were he interested in the post, might be the best possible person to serve as the new parliament’s presiding officer. He possesses the appropriate amalgam of empathy, decency, and rigour. Such a move, however, would be akin to admitting the final death of Scottish liberalism without the expectation it could ever be resurrected. It might be a prudent admission but it would be a sad one nonetheless.
So, there you have it: an election in which everyone can find some satisfaction. A reminder that in Scotland victory is never quite complete and defeat never entirely total. Like life, then, and there are worse lessons for an election to impart than that.


The leader of the Labour party, Sir Keir Starmer, has reshuffled his shadow cabinet after the party’s poor results in the English local elections. Rachel Reeves has been appointed as shadow chancellor, replacing Anneliese Dodds, while Labour’s elected deputy leader, Angela Rayner, will now mark Michael Gove as the shadow chancellor of the Duchy of Lancaster. Starmer unveiled his “refreshed and renewed team” last night, vowing the party will “learn from the places we lost”.
The UK home secretary, Priti Patel, has unveiled plans to switch English mayoral elections from the existing supplementary vote system to the first-past-the-post system, in a move that could make it easier for Conservatives to win future votes. The government will need to pass new legislation to change the voting system, which would also apply to elections for police and crime commissioners.
Fears of more violence in Jerusalem have mounted ahead of the annual day flag march, which usually sees young Zionists walk through Muslim areas. Israeli police faced off against hundreds of Palestinians protesters in the third night of clashes as tensions have soared over the threatened eviction of Palestinian families from parts of East Jerusalem’s Sheikh Jarrah neighbourhood.

Business and economy

The US government passed emergency legislation on Sunday as the country’s biggest fuel pipeline, the Colonial Pipeline, remained shut down following a ransomware cyber-attack. The emergency status has granted a total of 18 states temporary hours of service waiver for transporting gasoline, diesel, jet fuel, and other refined petroleum products while the pipeline works to restore service. The shutdown may trigger another rise in US petroleum imports, exposing the country’s energy vulnerability.
The UK prime minister is set to pledge a boost to the economies of struggling English towns during the debate on the Queen’s Speech on Tuesday. Boris Johnson, who is under pressure to deliver his “levelling up” promises, plans to set out a number of bills aimed at, among other things, creating eight new freeports in England, encouraging housebuilding, and introducing a post-Brexit state subsidy regime. (£)
Research by BloombergNEF has forecast electric vehicles will be cheaper to produce than conventional, fossil fuel-powered cars and vans by 2027 as a result of the falling cost of battery production and the existence of dedicated production lines in carmarkers’ plants. By 2026, larger vehicles will be as cheap to produce as petrol and diesel models, according to the same forecasts. BloombergNEF also expects tighter emissions regulations to push electric cars into dominating all new car sales by the middle of the next decade.

Columns of note

Labour’s candidate for the Hartlepool by-election, Dr Paul Williams, explains in The Times that the town’s issue with his party runs deeper than Keir Starmer’s popularity or a brutally effective Tory campaign. He argues that, while Hartlepudlians agree with Labour on the issues, there’s a credibility and identity gap “because of the antics of past Labour councillors”. Williams concludes by sharing responsibility for his party’s defeat and vowing to help Starmer define what Labour is and stands for. (£)
Writing in the Independent, John Curtice opines that Boris Johnson needs more than “accommodating gestures” and saying no to a second independence referendum in Scotland, in order to ensure that the country remains in the union. In light of the outcome of the Holyrood election confirming Scotland is evenly divided on the constitutional question, the prime minister will need to make the positive case for the union in a scenario that offers him much room for a misstep, argues Curtice.

Cartoon source: The Telegraph


The week ahead

A number of key companies are due to report this week. In Europe, Germany’s second-largest listed lender, Commerzbank, is reporting on Wednesday, after previously announcing it would shelve its dividend for the next two years and embarking on aggressive cost cuts, in an attempt to return to profitability.
In Asia, Chinese ecommerce group Alibaba and Japanese carmakers Toyota, Nissan, and Honda are also reporting this week. While Alibaba’s results follow a recent $2.8bn fine for allegedly abusing market dominance, the three car manufacturers raised their full-year profit guidance earlier this year.
In the UK, investors will be watching results from supermarket chain Wm Morrison on Tuesday and the country’s largest investment platform, Hargreaves Lansdown, on Friday.  Economic growth data for March is due on Wednesday and is expected to give an indication on how quickly the country’s economy is bouncing back from the pandemic-induced decline.
Finally, in the US, the Department of Labor’s core consumer price index for April will on Wednesday provide evidence on whether price pressures could become a mounting threat to the country’s economic recovery.

What’s happening today?

Alfa Fin
F&C Investment Trust
Midwich Grp

UK economic announcements
(08:30) Halifax House Price Index

Int. economic announcements
(10:00) ZEW Survey (GER) – Current Situation
(10:00) ZEW Survey (EU) – Economic Sentiment
(10:00) ZEW Survey (GER) – Economic Sentiment

Source: Financial Times

did you know

In 1958, nearly 75% of Britons drank hot tea with their dinner. (source: @qikipedia)

Parliamentary highlights

House of Commons

The House of Commons is in prorogation and will next sit on 11 May.

House of Lords 

The House of Lords is in prorogation. The House will next sit on 11 May 2021.

Scottish Parliament 

The Scottish parliament is currently dissolved following the 6 May election. The first meeting of the new parliament is expected to take place on 13 May 2021.

Share this post