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Laurie Macfarlane

@lmacfarlane.bsky.social
4.2K followers 1.9K following 436 posts

Co-director @FutureEconScot.bsky.social Fellow UCL IIPP and the Democracy Collaborative. Co-author ‘Rethinking the Economics of Land and Housing’

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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
This is the key issue with those claiming “you can have public control without ownership”. It’s control - not ownership - that matters for sector classification - and the only type of public control that’s compatible with private classification is very weak.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
The public-benefit firms probably could be designed to sit off balance sheet, but this would mean giving up most meaningful aspects of public control. It would be “public control” in name only.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
So in practice, it’s possible that these firms would be classified as public, meaning they’d sit on the public balance sheet. In other words: it would be fiscally identical to nationalisation, even though the whole point was to keep them off the public balance sheet.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
They also propose radical changes to water firm governance, constitutions, pay, etc. Again the ONS would examine these very seriously as signs of public control, particularly when combined with a golden share. And public control = public sector, even if it’s privately owned.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
A golden share doesn’t automatically mean public classification - it depends on the specific rights conferred. They cite the examples of BAE and Rolls-Royce, but these golden shares are very narrow, focused on national security. They don’t give a say over day-to-day policy.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
One mechanism they propose is for the state to retain golden shares in the new firms. But when the ONS classifies bodies as public or private, it’s control - not ownership - that matters. The existence of a golden share is viewed as a form of public control.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
Their proposed new public-benefit companies would face some challenges. Although they would be privately owned, mechanisms would be put in place to provide strong public control. This, it is argued, means we can have public control without the cost of public ownership.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
Their main argument against nationalisation is that firms won’t be run efficiently, citing post-war examples. But you don’t need to look far to see this isn’t true. Scottish Water is publicly owned and run reasonably well. Public ownership of water is the norm globally.
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Laurie Macfarlane @lmacfarlane.bsky.social · 25/09/2026
Andy Haldane and Will Hutton argue that we can have public control over water without public ownership. The key is to create new privately owned “public-benefit companies”. But there are some issues with this argument.🧵
theguardian.com
Andy Burnham talks about ‘public control’ of the utilities but it’s a minefield. We can lead him through it | Will Hutton and Andy Haldane
Nationalisation is not the ultimate answer for companies like Thames Water – but they could be run for the public benefit, say journalist and economist Will Hutton and former chief economist of the Ba...
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Future Economy Scotland @futureeconscot.bsky.social · 17/09/2026
Audit Scotland’s new report echoes many of the shortcomings we identified with the ScotWind offshore wind leasing round. But more can be done to ensure the wealth generated by Scotland's offshore wind is widely shared. Read our full response: www.futureeconomy.scot/press/447-re...
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Future Economy Scotland @futureeconscot.bsky.social · 15/09/2026
Scotland’s new Programme for Government offers the clearest picture yet of the Scottish Government’s plans for the next five years. While there was much to welcome, Scotland’s looming fiscal gap was the elephant in the room.
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Future Economy Scotland @futureeconscot.bsky.social · 02/09/2026
The Programme for Government includes some welcome measures on climate change, but elsewhere ambitious rhetoric is not matched by concrete policy. Read our full response to the Scottish Government's climate change agenda: www.futureeconomy.scot/press/383-re...
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Future Economy Scotland @futureeconscot.bsky.social · 01/09/2026
While aspects of the Programme for Government are commendable, relying on optimistic efficiencies to close the budget gap poses serious risks. Read our full response: www.futureeconomy.scot/press/382-fe...
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Juanpe Castro @jujupepe.bsky.social · 27/08/2026
Drilling in Rosebank and Jackdaw will not deliver energy security or an economic boost for UK households. Our latest @futureeconscot.bsky.social blog argues the North Sea is in long-term decline and only a rapid transition to green energy can deliver a prosperous, resilient future.
futureeconomy.scot
Four reasons more drilling won't save the North Sea
Sustained economic prosperity and energy security will only come from a green transition.
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Laurie Macfarlane @lmacfarlane.bsky.social · 28/08/2026
The Commission will continue to play a vital role in providing scrutiny and advice to the Scottish Government – and in ensuring that costs and benefits are shared fairly. I look forward to helping shape this work during the new Parliament, at a time when bold policy is needed more than ever.
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Laurie Macfarlane @lmacfarlane.bsky.social · 28/08/2026
Crucially, a just transition isn't just about emissions reduction – it necessitates a broader transformation to create an economy that is fairer and more sustainable by design. Climate, economic and social policy are not separate domains, but fundamentally interconnected and mutually dependent.
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Laurie Macfarlane @lmacfarlane.bsky.social · 28/08/2026
I’m honoured to have been appointed to Scotland’s third Just Transition Commission. Scotland stands at a critical juncture in its transition to a net zero economy, and over the next five years ambition must be matched by delivery. 🧵
gov.scot
Third Just Transition Commission established
Fairness at the heart of how Scotland adapts to a changing climate.
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Ewan Gibbs @ewangibbs.bsky.social · 27/08/2026
A really helpful overview of the North Sea's future which gets to grips with the real nuts and bolts of the situation. Don't believe the hype. It's corporate owners motivated by profits who are closing down oilfields, not environmental legislation.
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Laurie Macfarlane @lmacfarlane.bsky.social · 27/08/2026
The North Sea is in long-term decline - and climate policy isn’t the reason. New licenses won’t reverse that trend. Like it or not, Scotland must plan for life beyond fossil fuels. Great read from @jujupepe.bsky.social👇
futureeconomy.scot
Four reasons more drilling won't save the North Sea
Sustained economic prosperity and energy security will only come from a green transition.
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Future Economy Scotland @futureeconscot.bsky.social · 26/08/2026
NEW: Four reasons more drilling won't save the North Sea Our latest blog looks at why the economic case for further drilling doesn't stack up. And why long-term prosperity instead depends on accelerating the transition to green energy. Read in full: www.futureeconomy.scot/posts/619-fo...
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Future Economy Scotland @futureeconscot.bsky.social · 25/08/2026
Scotland’s short-term funding boost masks a looming fiscal crunch. Public service reform alone won’t close the gap – tax rises are needed to protect services. Read our full response to the latest @scotfisccomm.bsky.social update: www.futureeconomy.scot/press/381-re...
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Future Economy Scotland @futureeconscot.bsky.social · 20/08/2026
Income per head grew faster in Scotland in 2024 than in the rest of the UK 🏴󠁧󠁢󠁳󠁣󠁴󠁿 GDHI per head grew 7.2% to £24,283 – now 93.5% of the UK average, up from a low of 91.3% in 2018. Scotland grew faster than every UK region except Northern Ireland. 🧵
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Laurie Macfarlane @lmacfarlane.bsky.social · 06/08/2026
Last week we heard that Scotland’s 48% income tax lost £22m of public revenue. I spoke to the Holyrood Sources podcast about why the figure doesn’t stand up to scrutiny 👇
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Future Economy Scotland @futureeconscot.bsky.social · 06/08/2026
Did Scotland’s 48% income tax really lose revenue rather than raise it? Our Co-Director @lmacfarlane.bsky.social spoke to Holyrood Sources podcast about why the claim doesn’t stand up to scrutiny. Watch the full discussion (from 20 mins): youtu.be/j03__bAAOGk?...
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Future Economy Scotland @futureeconscot.bsky.social · 06/08/2026
Last week, there was extensive discussion about whether Scotland's 48% top rate of income tax has reduced public revenue. We've published a detailed analysis examining the evidence. Here's a summary of what we found. 🧵
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oxfamscotland.bsky.social @oxfamscotland.bsky.social · 04/08/2026
Worth reading the full analysis from our #TaxJusticeScotland colleagues: www.futureeconomy.scot/posts/587-ha... Important to also reflect on other ways S Gov can fairly raise more money and what higher taxes are ultimately for. If we want a fairer Scotland, we need to be willing to pay for it.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Read the full response on the @futureeconscot.bsky.social website: www.futureeconomy.scot/posts/589-a-...
futureeconomy.scot
A response to Dan Neidle: Tax doesn’t always explain everything
The case for being honest about what we simply do not know.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
The only honest conclusion is: Tax-related behaviour potentially contributed to an unusual fall. But the evidence isn’t there to say it caused the entire divergence. We can't therefore say Scotland’s higher rate tax lost revenue – never mind to the tune of £22m specifically.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
At the end of the day, Dan is making the specific claim that the reforms lost £22m. The burden is therefore on him to justify the assumptions required to reach that figure. We don't need to prove a particular non-tax driver to show that the £22m loss isn't very credible.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Dan offers several reasons why tax could be the best explanation: statistical unusualness, correlation with tax rises, possibility of income switching, self assessment data. These are relevant, but they don't justify the assumption that 100% of the gap is all tax-related.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
To be clear: this doesn't prove that the tax increases raised revenue. We don’t know the true division between tax drivers and other forces. But this uncertainty cuts both ways: it also means the evidence doesn't support a £22m loss – or even that there was any loss at all.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Scottish and rUK top incomes have never moved in perfect annual lockstep – other factors have repeatedly driven divergence. How credible is it to assume that non-tax factors explained none of the 2024-25 gap? This is a very strong and currently unsupported assumption.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
We can also present this sensitivity using the tax bases implied by Dan's revenue figures. On this basis, if non-tax factors explain more than 14% of the divergence, the revenue loss vanishes. Crucially, there is only a £22m loss if we assume tax drives 100% of the divergence.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Our position doesn’t require tax to have had *no* behavioural effect. It doesn't even require tax to have been a minor contributor. Tax could have driven the overwhelming majority of divergence and the Scottish Government would still have raised rather than lost revenue.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Extrapolating this, the 1.2% is crudely equivalent to around 9% of the 13 point gap in top income growth between Scotland and rUK. In other words: tax could still account for c90% of the divergence and the alleged “revenue loss” would still disappear. This is the key point.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
This distinction matters because Dan accepts that his £22m revenue loss is conditional. The entire “loss” disappears if Scottish top incomes would otherwise have grown just 1.2% more slowly than rUK. A small change in the counterfactual reverses the result.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Dan’s tests show that the latest divergence was statistically unusual (but only just). This strengthens the case that tax contributed. But “unusual” doesn’t mean “entirely caused by tax”. The tests don't tell us what share was caused by tax versus other factors we know exist.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Our charts showed Scottish and rUK top incomes have repeatedly diverged historically, showing there are drivers beyond tax at play. Dan accepts this is the case, but argues the recent divergence cannot be explained by historic volatility.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Dan’s £22m estimate assumes that, without Scotland’s higher tax rates, Scottish top incomes would have grown in line with rUK. He then assumes that 100% of the divergence from that counterfactual is tax-related. This is a big assumption.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
Crucially: we never claimed Scotland’s higher tax rate caused *no* behavioural response. We described some response as a “near certainty”. The real question is much narrower: was the behavioural response large enough to outweigh the extra revenue raised by the higher rate?
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
You can read our full response here. Before reading it, I’d recommend reading both our original critique and Dan’s constructive response (link to both in the article): His response makes several fair points – but it also subtly reframes the debate. Some key points ⬇️
futureeconomy.scot
A response to Dan Neidle: Tax doesn’t always explain everything
The case for being honest about what we simply do not know.
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Laurie Macfarlane @lmacfarlane.bsky.social · 03/08/2026
I recently published a critique of @danneidle.bsky.social's claim that Scotland’s 48% tax reduced revenue. Dan has now updated his analysis in response, arguing it doesn't invalidate his findings. I don’t think he resolves the central problem – here’s why. 🧵
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Laurie Macfarlane @lmacfarlane.bsky.social · 02/08/2026
Dan has since updated his analysis in response to my piece (see new section on volatility here). I don’t think this has resolved the core issues - I’ll be sharing more thoughts soon.
taxpolicy.org.uk
Scotland’s 48% top rate: is it raising any money at all?
HMRC’s first full year of outturn data for Scotland’s 48p top rate of income tax suggests it may be raising nothing at all - and could be losing money.
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Laurie Macfarlane @lmacfarlane.bsky.social · 02/08/2026
ICYMI: Last week @danneidle.bsky.social made headlines by claiming that Scotland’s 48% top rate had reduced revenue. My long critique argues his analysis proves nothing of the sort 👇
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James Aithie 🏴󠁧󠁢󠁳󠁣󠁴󠁿 @jamesaithie.bsky.social · 02/08/2026
Really interesting discussion between @mmgeissler.bsky.social and @lmacfarlane.bsky.social 🏴󠁧󠁢󠁳󠁣󠁴󠁿 🎙 3 days left to watch/listen BBC Scotland - Scotcast, Tax Rates Debate share.google/ibTSYas0PEDO...
share.google
BBC Scotland - Scotcast, Tax Rates Debate
Martin asks if Scotland’s tax system is costing or raising us money.
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Ally Tibbitt @allytibbitt.me · 01/08/2026
@lmacfarlane.bsky.social takes a close look at @danneidle.bsky.social claims on Scottish Government tax policy and the subsequent media reporting on it. www.futureeconomy.scot/posts/587-ha...
futureeconomy.scot
Has Scotland’s 48% tax rate really reduced public revenue?
The media should take note: a modelled hypothesis is not the same as definitive proof.
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Jo Michell @jomichell.bsky.social · 01/08/2026
Important stuff here from @lmacfarlane.bsky.social. I had a busy week (school holidays); I spotted the “higher tax rate loses money for Scotland” headline, thought it sounded dubious at best, and mentally made a note to come back and check it. Fortunately Laurie has done it for me.
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Laurie Macfarlane @lmacfarlane.bsky.social · 01/08/2026
Dan's analysis has had a huge impact over the past week, but it's important that policy is shaped by evidence and not misleading media hype. Please do read the full analysis on @FutureEconScot's website ⬇️ www.futureeconomy.scot/posts/587-ha...
futureeconomy.scot
Has Scotland’s 48% tax rate really reduced public revenue?
The media should take note: a modelled hypothesis is not the same as definitive proof.
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Laurie Macfarlane @lmacfarlane.bsky.social · 01/08/2026
Finally: if the 48% change was only ever supposed to raise £8m, then why bother doing it? This is an important question which I discuss in the piece. And it relates to where I think the Scottish Government took a wrong turn on tax policy.
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