Last week’s TNS poll will bring some relief to Scottish Labour. Cutbot’s UNS based projector forecasts a respectable (relative to expectations) seat tally of 28 for Labour, my own projection based on regional breakdowns forecasts 26 seats for Labour.
On TNS’ figures, the SNP look set to win 67 out of 73 constituency seats, with Labour retaining only Dumfriesshire. While the Tories lose Galloway and West Dumfries, and Ayr, they make a surprising gain by unseating Roseanna Cunningham in Perthshire South and Kinross-shire. Perhaps even more surprisingly, however – despite losing Liam McArthur in Orkney, the Lib Dems re-take both North East Fife AND Dunfermline! If that actually happens, I’ll eat Paddy Ashdown’s hat.
The regional list picture is a little bit more muddled, with Labour polling abysmally in the Highlands and Islands, and North East, but actually outpolling the SNP, 43% to 41%, in Glasgow. If these numbers are reflect in votes cast next month, then the Highlands and Islands will become the first ever region to have no Labour MSPs whatsoever. In Glasgow, Labour picks up an impressive six regional list seats, with a further five in Central and West – all very much at the very top-end of expectations. Labour drops to two seats in Mid Scotland and Fife, North East, and Lothians – making Sarah Boyack Labour’s highest profile casualty.
Having dominated the constituencies in most regions, and with less impressive vote shares in the two regions where their constituency hegemony is fettered, the SNP only picks up four regional list seats, bringing their total seat tally to 71.
While the Tories could expect no fewer than eleven new faces among their group, on these numbers, Adam Tomkins won’t be one of them. UKIP picks up a single seat in the North East, with their Scottish Leader David Coburn missing out on a seat in the Highlands and Islands.
The Greens are polling strongly in the Lothians, as you would expect, easily picking up two seats in the region. On TNS’ numbers the Greens could also expect two seats in the Highlands and Mid Scotland and Fife. Though instinctively unlikely in reality, strong numbers in Mid Scotland and Fife have featured very frequently in the polls in the run up to this election – I’m starting to think there might be something in it.
There are some close contests. On the basis of these numbers, Labour’s best chances of retaining seats (other than Dumfriesshire) are Glasgow Provan, Rutherglen, and East Lothian. The Tories only take Perthshire South by a whisker, while losing Ayr and Galloway by even smaller margins. The Lib Dems, only scrape through in each of the three seats they’re forecast to win.
Perhaps the most interesting figures are in the SNP’s vote shares, which I’ll go into in some more detail next time.
Where trusts are concerned, there are three different roles:
A settlor (or trustor, more commonly in Scotland), who places the assets into trust in the first place.
A trustee, who strictly speaking owns the assets, but not for his or her own beneficial interest. The assets held in trust do not form part of the trustee’s personal assets.
A beneficiary, who will ultimately receive the income and/or capital from the trust.
Sometimes, one person can hold more than one role. For example, it might well be that the settlor is also the beneficiary of the trust – but he or she wants to be removed from the day-to-day management of the assets. Similarly, a settlor might also be the trustee, with the intention of protecting certain assets that he or she intends upon passing to their children when they reach a certain age. While in certain trusts, the beneficiaries have a direct proprietary interest in the trust (i.e. a legal entitlement to receive trust income or capital), other trusts are discretionary in nature – whereby the trustees can decide who they make payments to, when they are made, and how much. As there are no fixed beneficiaries of a discretionary trust, no one can be said to be a beneficiary of such a trust until they have actually received a benefit. Nonetheless, most such trusts are set up with a specific understanding that the trustees will make such payments to certain specified persons, notwithstanding their discretion. You literally trust the trustees to act in accordance with your wishes. Such trusts are particularly convenient when you want to conceal the real beneficial owner of assets.
The most common use of trusts, therefore, is for Inheritance Tax purposes. For example, payments into discretionary trusts can create significant tax advantages, as Inheritance Tax is payable at the point at which the money is transferred into the trust (as opposed to when you die) at half the usual rate. A nil-rate band discretionary trust is a common feature in every middle class will (they still have some advantages even following the introduction of the transferrable nil-rate band).
It is particularly common for Members of Parliament to set up trusts for innocuous purposes too. For example, someone who owns a business who is elected to Parliament might well want to return to that business when they cease to be an MP, in which case the wise thing to do is to place their ownership of that business into a trust in order to avoid creating a conflict of interest.
However, offshore trusts are an altogether different animal, with secrecy and tax avoidance at the core of their purpose. For example, trusts pay income tax just like everyone else. So if your plan is to place investments into a trust, and then re-invest the income from those investments so that the value of the trust grows further, the amount that you can re-invest will be curtailed by the fact that every year income tax will be payable on that income before it can be re-invested.
If, however, your trustees are located outside of the United Kingdom, but say, in a tax haven, then that recurring income tax is no longer an issue. The capital held in the trust can grow and grow, free from the encumbrances of recurring taxation. Tax is only payable in the UK on a remittance basis – that is to say when a UK-resident beneficiary receives a payment out of a trust he or she must declare that payment as part of their tax return. The beauty part is that this only happens once, rather than annually, and payments can be deferred until necessary or convenient.
This is why the explanations given by David Cameron in response to questions about their own interests in offshore trusts have been far from comprehensive.
“I have no shares, no offshore trusts, no offshore funds, nothing like that. And, so that, I think, is a very clear description.”
Except that it’s not a very clear description at all. What did Dave mean by that? Does he mean that he has never set up a trust? That he’s not a trustee? That he’s not a beneficiary of any trust? This not-very-clear answer prompted Downing Street to issue another statement, denying that the PM or his family “benefit from any offshore funds”, with the seemingly deliberate present-tense of that denial raising more questions than it answered. The subsequent denial is more unequivocal, declaring that there are “no offshore funds/trusts which the prime minister, Mrs Cameron or their children will benefit from in future.”
From this, therefore, it is clear that the Prime Minister does not benefit from any offshore trusts, nor does he have any beneficial interest in any offshore trusts from which he can call in future. But what about one of those discretionary trusts, mentioned above? While it’s entirely possible to say quite unequivocally that you will not benefit from interest-in-possession trusts, it is impossible to say with any certainty that any of us will never be the beneficiaries of an existing discretionary trust in the future. The nature of such trusts is that they are discretionary, and a trust in which someone has no direct beneficial interest might, nevertheless, some time down the line, exercise their discretion and start making payments to you.
This is where the Prime Minister’s explanation is still inadequate. While the Telegraph has posed three questions that the PM still needs to answer, the key question is this: did Ian Cameron set up any discretionary trusts? If he has, then the persons to whom that trust has made payments in the past will be the best indicator of the sorts of persons to whom such a trust will make payments in the future.
I feel slightly sorry for David Cameron – he has clearly hasn’t done anything wrong. His father was a shrewd high-financier, who will doubtless have gone to considerable lengths to ensure his family was provided for. How was he to know that Baby David would grow-up to be Prime Minister? If Ian Cameron did set up an offshore discretionary trust with his children as intended beneficiaries then Dave can hardly be blamed for that. What the public is, rightly, concerned about, however, is the perception that the government’s inaction on tackling this sort of avoidance might, perhaps subconsciously, be due to a feint expectation by the Prime Minister and the Chancellor that they too might, sometime down the line, be the beneficiaries of such trusts. This is why nothing short of full disclosure will settle the issue, and the sooner that happens the less painful it will be for everyone.
The 2015 general election produced a considerable spike in turnout in Scottish constituencies. Following the election, I produced a projection that adjusted the election result for the turnout spike, in order to provide a better picture of the political situation based upon “normal” turnouts. Unsurprisingly, on the basis of exit polling, the spike in turnout was overwhelmingly attributable to the SNP. Perhaps a little surprising was that the spike in turnout actually had relatively little effect on the results in most constituencies. Only Paisley and Renfrewshire South and East Renfrewshire would have been saved for Scottish Labour; Edinburgh West, Caithness, Sutherland, & Easter Ross, and Ross, Skye, & Lochaber being saved for the Liberal Democrats; and Berwickshire, Roxburgh & Selkirk gained by the Tories.
Just for fun (yes, this is what constitutes fun in my sad world) I’ve projected those results onto the Scottish Parliament, and below are the results. However, it’s worth noting how I arrived at this projection, beyond simply adjusting for turnout.
Having adjusted the turnout to something approaching a “normal” General Election level (which, it is worth noting, is still higher than a typical Scottish Parliament turnout level), and applied it to the constituency section of my model, it then became necessary to apply these results to the regional list votes, which is obviously more difficult. As noted previously, parties typically suffer a degree of “regional leakage”, with constituency support going elsewhere in the regional lists. The leakage proportion from 2011 was used (which has Scottish Labour dropping off quite considerably, with the SNP remaining fairly solid). This produces a significant “other” vote. This “other” vote was then allocated to the smaller parties in proportion with the figures in the recent Survation polling.
It is worth reiterating that this is not a projection, it is an extrapolation. Its primary purpose is not to forecast May’s election, as we all know how Westminster and Holyrood elections can produce wildly different results even when they are relatively close to one another. Rather, this extrapolation provides a yardstick against which the coming election can be measured, as well as some indication of where parties ought to be focusing their efforts, in light of the fairly significant political reset that has taken place.
The extrapolation sees another SNP near clean-sweep. Labour retains four constituencies: Coatbridge and Chryston; Cowdenbeath; Dumfriesshire; and Renfrewshire South. The Lib Dems retain their present two seats, and retake Ross, Skye, and Lochaber. The Tories retain their present three seats and gain Eastwood. In addition to those seats that change hands, the model produces a number of close contests: Edinburgh Central, Southern, Pentlands, and Western; Glasgow Provan; Dunfermline; Kirkcaldy; Aberdeen Central; Aberdeenshire West; East Lothian; and Dumbarton. If anyone is expecting some surprise results in May, they’ll likely come in one of those seats.
Overall, the result is broadly in line with current projections. With a majority of 7, the SNP are down one seat on their 2011 result. Labour’s total of 29 seats is at the upper-end of expectations, with the Tories gaining three seats in the more traditionally Conservative regions of the North East, South, and Mid Scotland and Fife. Figures from the Lib Dems are distorted somewhat by the fact that 2010 saw incumbents in some seats faring relatively well against the SNP tide. Jo Swinson’s vote in East Dunbartonshire translates to a Lib Dem seat in the West of Scotland list, while Charles Kennedy’s vote in Ross, Skye, and Lochaber would probably be a gonner absent the man himself.
One striking feature of this extrapolation is how in line it is with current polling. While this might attest to the veracity of the polling, it may well also be that, as appeared to happen in polls in the run up to 2011, respondents are telling polling companies how they voted last time, as opposed to how they’re going to vote in May. In 2011, the polls only began to move to the SNP during the short campaign. It may well be that there’s still some movement to be seen in the polls after all.