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Alex Salmond has long said he only likes to deal with hypotheticals when they assume the positive.

"What if you fail to reach your target of winning 20 seats?" No answer.

"What if you succeed...?" He responds enthusiastically.

And after he set out his new economic strategy on Thursday, no-one could accuse him of lacking in positive hypotheticals.

I heard the speech, and heard further from the SNP leader as well as his advisers. And the strategy seems to boil down to this:

There's no talk of cuts, seeing that as part of the Lab/Con/LibDem debate. The SNP's opponents are accused of having an iceberg of unidentified cuts lurking and threatening the good ship British Economic Recovery after the election.

Instead, there's a three-prong Nationalist approach, based not on a static model of taking the deficit as it is, but on a dynamic economic model of what there could be.

Having had the Scottish government's chief economic adviser (Andrew Goudie, a non-party civil servant) tell them there is a gap of between £25 and £35bn in spending over the next 12 to 15 years, they have sought to find ways to fill that gap, rather than cut spending in order to meet it.

For at least a year, the SNP would keep the extra £350m stimulus it had last year, but which it has been denied by the Treasury this year. Only once growth is secure for a full year, they reckon that could be withdrawn, and they don't expect that would be before next spring.

No new missiles

Once the risk of recession has been seen off, prong number one: cut big projects, prominent in statements over the past couple of weeks; no replacement of the Trident nuclear deterrent, no nuclear waste dump, no ID cards etc.

I've already questioned whether these offer much in the way of savings over the next five years. The big Trident replacement savings kick in after that, which might help explain why Alex Salmond has chosen a 15-year horizon.

If we take the SNP's figures, Scotland's share of those savings would reach about £5bn, meaning 20% of the gap Dr Goudie has identified.

To that, add a couple of one-off additions to the Scottish budget: this year, a £200m fossil fuel levy the SNP says is due to Scotland but is being withheld by Whitehall. And next year, reckon on Scotland's share of London's Olympic spending, which the Treasury has refused to recognise as being worthy of sharing around the UK through the Barnett Formula.

Growth spurt

Another 40% of that gap could be filled in by continuing an efficiency squeeze of 2% per year on public spending. That squeeze is now being applied for the third year. Until now, it's been used to free up resources for government priorities. Under this new plan, it would be used to reduce spending.

The third 40% would come from the third prong of this strategy: boosting growth, and thus boosting earnings and tax revenue.

How would this come about?

No increase in National Insurance contributions next year, as Labour plans.

Next, help for business with a fuel duty regulator, pulling back on petrol and diesel tax increases when oil's market price rises.

Eventually, the SNP would like to cut corporation tax. But it's not in a hurry to do so, and it's no longer citing the success Ireland made of it until recently.

Taxation powers

That's if it were to win the powers to vary taxation. And that's where more assumptions pile in to this economic strategy.

First, it assumes Scotland would be given around 90% of the offshore oil revenue that comes from waters around Scotland and now goes direct to the Treasury.

Next, Alex Salmond has seized on the work of two eminent professors - Andrew Hughes-Hallett in economics, Drew Scott in European law - who reckon that Scotland could see a boost to its spending over five years if it were to have power over taxation.

If you look at the , they used foreign examples to argue that fiscal autonomy could, in itself, boost growth for five years.

There's quite a wide variation in the potential growth boost, and they're not guaranteed. Some countries shift to devolved taxation, and don't find that happening at all.

With a subsequent move to independence, it's claimed that Scotland could boost its growth rate by a perpetual 1% over the rate it could assume if it remains in the UK. The SNP plan assumes they would have fiscal autonomy for five years, and then have independence thereafter.

With that dynamic, Scotland would get to 2025, and everything would be peachy. To quote Alexander Meerkat: "Seemples".

Olympics share

But let's recap on how many hypotheticals we've just gone through:

Scotland would get the proceeds of the fossil fuel levy this year.

Next year, Scotland would be granted a share of London Olympics spending, based on the Barnett Formula and so far denied.

Scotland would have to secure devolution of full fiscal powers over the next couple of years.

The SNP argues this could be achieved with enough leverage over a minority government at Westminster. That outcome is hard to predict. What if there's a coalition which could ignore the SNP?

Scotland would get control over around 90% of offshore oil tax revenue, even while it remains within the UK and, of course, after it becomes independent.

There would be no significant costs in the transition to fiscal autonomy, and again to independence.

Independence premium

The savings from cancelling Trident and other projects would add up, as the SNP calculates, bringing a £5bn saving to Scotland.

The gap identified by Andrew Goudie would be at the lower end of his projections, whereas a growth rate falling below Treasury estimates (which many independent commentators believe to be over-optimistic) would mean a much bigger spending gap over the next 15 years.

The efficiency gains of 2% per year would have to be delivered throughout the 15-year period. While the SNP says it has been independently audited and its savings programme is working, the claims of efficiency savings in Whitehall are strongly doubted by independent analysts.

Fiscal autonomy would deliver the five-year boost suggested by Professors Hughes-Hallett and Scott.

Independence would provide a premium on the growth rate of 1%.

Meanwhile, this approach to spending would have to win the support of the bond markets. An independent Scotland would have to establish its credibility with credit ratings agencies Fitch, Moody's and Standard & Poor, while spending its way out of trouble. Indeed, there has to be a risk that a minority Westminster government having to give in to the demands being placed on it by nationalist MPs would suffer a blow to its credit rating in the next few months, knocking everyone's recovery plans off course.

This also seems to assume there would be no further recession during the next 15 years. If that were achieved, it would be unlike any period in modern history. Alex Salmond would have succeeded where Gordon Brown failed, in bringing an end to boom and bust.

To have all that going the SNP's way would require quite a lot of luck. Indeed, Scotland would have to make much of its luck, when it could be tempted into alternative policy decisions, about tax for instance.

So far, the SNP's new economic strategy looks a model of sunny optimism - a triumph of hope of fear and "a dismal decade" from its rivals. It doesn't seem to have taken much account of the potential downsides.

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• - What's this?

It's not just Gillian Duffy who was making the big powerful people sweat on Wednesday.

The chairman of Royal Bank of Scotland had his annual encounter with the little people - the shareholders still very grumpy at the dismal plight of their blue chip investment.

Sir Philip Hampton handled his challenge rather more competently than Gordon Brown.

And unlike the Prime Minister, he had the benefit of knowing he had the resolution results in the bag - put there by his main shareholder, the UK government's investment arm, swinging 70% of votes his way.

On the contentious issue of executive bonuses, less than 1% of votes were against.

The protest was more audible than that - a sort of indignant murmur when Sir Philip suggested that banker bonuses are not "obscene".

The directors are yet to make clear the threshold for bonuses this year, and have until next week's quarterly results to clarify.

That update is published at 7am on the morning of 7 May - as election results are digested, a good time to bury bad news, perhaps.

Out the mire

There's a familiar reasoning behind remuneration.

RBS has to pay market rates. It can't set the market.

And it needs the top investment bankers to dig it out the mire.

Familiar too was the reasoning behind RBS's failure to hit its business lending targets last year; it's having to fill a gap left by others who left the scene of the credit crunch, businesses are keen to pay down debt rather than build it up, and 75% of the pre-crunch lending was for commercial property, now not a place you would want to sink loans.

New was the argument that business lending is not a necessary pre-condition for growth.

Sir Philip cited the 1990s, when lending fell over three years and recession turned to growth at an annual 3%.

Under majority public ownership, campaign groups see RBS as vulnerable to pressure on environmental and human rights issues.

So Sir Philip faced not just a lot of shouting outside the Edinburgh International Conference Centre (incidentally, about 200 meters from the Point Hotel where his chief shareholder, Alistair Darling, was making a campaign speech), but a couple of pointed questions from those campaigners in possession of share certificates.

Criminal gangs

One documentary-maker, Simon Chambers, raised lending for Vedanta Resources, a London-listed company active in India.

Another - Eriel Tchekwie Deranger speaking for the First Nation people of Alberta in Canada - sought to link RBS lending to oil companies whose tar sands extraction is, she said, degrading the environment and costing lives.

Sir Philip's response was polite but firm: while RBS claims to have moved out of tar sands, the business activities of client companies is not his responsibility.

Yes, he acknowledged the bank cares about reputational risk.

But it's not for a bank to second-guess the environmental regulatory regime in Canada, or to police human rights abuses in India.

There are some customers the bank wouldn't have, the chairman reassured: "Criminal gangs are not on the list of our preferred clients."

Significantly, the attempts to use the leverage of public ownership has not had much impact politically, yet.

The government has passed on public pressure for action on banker bonuses and business lending, but it hasn't responded to pressure on the ethical questions of lending.

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The worst squeeze on public spending since the 1970s, when the International Monetary Fund had to bail out Britain. Or it could be the worst for more than 65 years, if the Tories take charge and implement their manifesto plans.

This is the view of the Institute of Fiscal Studies. It's no surprise. We've seen versions of the same or a while. But this is the most reputable, independent watchdog of Britain's public finances. And it puts a lot of new pressure on political parties to spell out in more detail what they're going to do to get the deficit under control.

Let's go back to another key moment of post-1945 Britain for historical context - the great devaluation of 1967, which convulsed Harold Wilson's Labour government.

He is remembered at the time as telling the British people "the pound in your pocket" was worth no less as a result of a sudden drop in the then fixed exchange rate.

Absorb the shock

That was baloney of course. I was reminded of this by taking myself off to the eurozone over the weekend, where the pound in my pocket, converted into euros, bought a lot less in France than it did last time I was there.

Imports (or foreign holidays) cost more, and an open economy depends on a lot of imports. Even exporters depend quite heavily on imported components and raw materials.

Forty-three years ago, devaluation was a huge blow to the credibility of the Wilson government.

Now, it's a source of quiet relief. The depreciation of sterling over the past two years has boosted food inflation as well as oil, which is priced in dollars.

But it has allowed those who make their money in pounds sterling to absorb the shock to the British economy, without feeling the pain as obviously as they would with a straight pay cut, while giving the country some competitive advantage.

Drachma drama

In Athens, many would love to have that freedom to let the currency take the strain. Some would like the drachma back, eight years after it was lost to the eurozone. That might have absorbed some of the pain Greece is going through.

Such a move has been seriously discussed. But it's a non-starter. Not only would it undermine the euro but also the European project for all the other countries that use it.

In practical terms, it would mean the Greek government would collect its taxes in the weakening new drachma, while having to pay its debts off in euros. Nothing would be surer to achieve default.

And within the eurozone, default is very much on the cards. That's why the markets put the cost of two-year Greek government bonds over 15% today, with those bonds reduced to junk status, with Portugal's downgraded as well, knocking the world's stock markets with the fear of contagion.

By contrast, the Germans have played the eurozone game very cannily; staying competitive, savings lots, while paying a high price in unemployment and infrastructure for the cost of re-unification. Others have been much less disciplined, and they're finding out now that they can't do so indefinitely without a lot of pain - not only Greece and Portugal but those other PIIGS, Italy, Ireland and Spain.

Stultifying family

Two observations about Greece's woes, and perhaps implications closer to home:

Could this have to do with the strengths of tight-knit Greek families?
An article in the International Herald Tribune on Monday, written by a Greek woman law lecturer in Washington DC exile, argued that the economy is stultified by small family firms in which labour is in-house, exploited and the next generation's ambitions are corralled.

It's a very different take on such companies than was heard at a seminar on Tuesday run by the Scottish Family Business Association, where the biggest problem tends to be handling the transition from one generation to the next.

It claims 45% of the UK's GDP is produced by family enterprises, and 50% of the private sector workforce in Scotland is employed by them.

But Philomena Tsoukala's take on the public sector reforms in Greece is the opposite of the conventional wisdom that the welfare safety net should be cut back: instead saying a safety net should be provided "to help free young Greeks from the supportive yet suffocating grip of their families".

A generation of young workers languishing in their parents' living rooms and storerooms could be set free to help turn around the Greek economy, goes the argument.

Tory divisions

The other consideration is that Germany and Finland are looking to strengthen the rules of the eurozone to ensure Mediterranean members can't wreck it with their indiscipline.

They're talking about a new treaty between all EU members - just what the British Government dearly hoped it could park for at least a decade, while the dust from the constitutional wrangling of the past decade is given time to settle down.

And here's a challenge for an incoming Conservative government; would it welcome new treaty negotiations as a means to unravel elements of the union it doesn't like: would it feel committed to hold a referendum: or is that a fast-track to opening up the party's divisions over Europe?

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• - What's this?

Alex Salmond says it's "chilling": thirty-five billion pounds (say it slowly) less money to spend over the next 12 to 15 years.

Only from around 2022 could Scotland's public spending levels return to the levels we saw with last year's peak.

Any politician hoping to be in power, or already in power, has to decide where to implement those cuts.

And it's no longer the academics' take on how much the Scottish government will have to cut spending.

This is now the official view of St Andrew's House's chief economic adviser, Andrew Goudie.

To be clear, £35bn is his worst case scenario for the cumulative real term cuts that Holyrood faces until spending returns to current levels, which would be around 2022.

If HM Treasury's optimistic estimates of growth turn out to be correct, it will be a mere £25bn.

One pound in eight

Is that still too big to comprehend? Ok, let's break it down.

Dr Goudie reckons that one pound in every eight will be cut out of spending over the next four years.

Roughly £3.5bn to £4bn, in real terms, cut out of spending by 2014-15.

Most of the pain from that £25-£35bn squeeze will be in the near future rather than the start of next decade.

Yes, there might be some protection if the next Westminster government opts to protect services in Whitehall that are devolved to Holyrood - in Labour's case, policing, schools and hospitals, in the Conservatives' case, the NHS.

We won't know the details of that until we get a spending review from the new/re-elected UK government, probably this autumn.

But Dr Goudie warns that protection of some services won't change the key message that arises from his analysis of public spending plans available so far: prepare for very tough times and very tough choices.

And what makes this necessary? Well, with the figures published on Thursday on last year's borrowing by the UK government, it's possible to see in more detail what went so badly wrong for the public finances.

Stimulus

The total isn't quite as bad as Alistair Darling recently forecast.

But at £163.4bn, it's still humungous, and the biggest borrowing total we've seen - 11.6% of the UK's income.

On the spending side, the economic stimulus - such as the car scrappage scheme and accelerated capital spending, plus higher welfare costs and the cost of growing debt repayments - put the total up by 6.8%.

Don't under-estimate those debt costs.

They're already higher than all defence spending, and twice as much as transport spending.

And that's with interest rates low, with lots more borrowing to come over the next few years, adding to the debt total.

On the Treasury receipts side of the government's balance sheet, the total was own by 5.3%.

Of that, there was a fall of nearly 20% in takings from corporation tax and petroleum revenue tax; more than 8% less in income tax and capital gains tax; a 4% fall in VAT receipts; and a 1% fall in national insurance contributions.

That shows a picture of consumption falling much more slowly than business tax receipts.

And for all that Alex Salmond wants to grow the Scottish economy out of the slump, thus avoiding "London's cuts", Dr Goudie isn't suggesting that profitability and business tax takings will bounce back fast enough to end the need for the getting those spending totals down.

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So what will you cut, and which taxes will you raise?

In an , they're the questions that keep getting asked, and keep going unanswered.

We've seen Labour, Conservative and Liberal Democrat face questions on them. They have all left a lot of uncertainty around how to get the structural deficit under control.

So as would like to debate the leaders of those UK parties, how about putting his manifesto to the same test?

The test doesn't last long. He hasn't put forward a manifesto for Westminster that makes any pretence of offering a costed approach to solving Britain's financial woes.

Why should he? It would be both politically painful and unnecessary.

London's cuts

But he still gets the questions. Whoever is Prime Minister after 6 May, Alex Salmond has another year as First Minister, and he will surely face decisions around a comprehensive spending review this autumn.

That will include its first year of implementation from April 2011 - a month before the Holyrood elections.

So how is the question of balancing the books being answered?

There's the independence answer. Mr Salmond used it again this week.

Lots of oil and gas still to be pumped, so why does Scotland face "London's cuts"?

It's more rhetoric than budget.

But it returns to a familiar tension: if Scotland were to have access to its geographic share of offshore oil and gas revenue, it couldn't spend that on protecting public services and also use the same money to build up a Norwegian-style trust fund.

Fair deal for motorists

Short of independence, what's the answer?

The most prominent answer is: keep spending.

This is partly to keep the stimulus going, without any indication of when it might be stopped, or when deficit reduction should start.

There is at least one tax cut suggested, with a return to SNP support for business tax cuts, as used successfully by other countries. (Ireland is no longer specified as one of the "similar nations across Europe" which the SNP has in mind.)

There's a call for a "fair deal for motorists", paring back tax when the price of oil goes up.

That would reduce anticipated tax revenue, and risks compromising the party's green credentials.

And there are spending pledges, more to protect cherished services than to add commitments.

One of the pricier ones, though, is for high-speed rail.

That's in common with other parties.

What is different about Alex Salmond's plan is that he would require that building should start from Scotland.

That raises two questions: why build long, expensive stretches first, when the quick revenue return would be with high use further south?

Public subsidy would have to be higher that way.

Salaries freeze

And there's the independence question: would an English government want to build north of Manchester?

And if that weren't viable, would an independent government in Edinburgh be willing to subsidise building so that it reached the border at Carlisle?

The manifesto offers up some savings the Scottish government is proposing.

There's £40m if it succeeds in slimming down the extent of quangos. There's a halving of the marketing budget, which should deliver £5m in savings. There's 5% shaved off Scottish government administration costs. This year, the reduction is of £8m of savings, down to £262m.

So that equals savings of less than £50m, to which you can add a freeze on senior government salaries. So far, it's looking a bit piecemeal.

The manifesto goes on to cite efficiency savings already delivered by the SNP Scottish government; £250m from smarter procurement, better estate management and shared back office.

Big ticket savings

That's a more impressive figure, but it's going to have to be repeated year after year.

And it's quite a long way from the £3bn savings that experts predict may be required of the Scottish government.

What, then of the savings the SNP suggests for Whitehall.

The list from Alex Salmond; scrapping identity cards and saving £5bn: not spending £4bn on nuclear waste depositories: abolish the House of Lords, and its £100m annual bill: and no more Scottish Office, saving another £10m.

The big ticket saving, which gets the applause, is £100bn on Trident.

Looking closer at these, it seems much of the spend on ID cards has already been committed.

Conservatives also want to scrap them, and they reckon that would save them £1bn to £2bn on the set-up costs.

Ending plans for a nuclear waste depository would hardly make the cost of storage go away, so that's not a clear saving.

Nuclear submarines

And what about Trident. The £100bn price tag is an estimated lifetime cost, then rounded up by quite a few billion. Defence specialists put it closer to £80bn.

It remains a long way from the £15bn to £20bn figure the government originally announced for replacement with four submarines.

How much of that would be spent over the most intense period of the spending squeeze, and how much could cancellation help?

The British American Security Information Council reckons on less than £500m in development costs being spent for the next three years.

It then ramps up to £1bn per year in 2016.

That doubles in 2018, and in 2020, it looks like five years of spending more than £4bn per year, before falling in 2028, to a £2bn running and maintenance cost for the remaining 14 years of the system's lifespan.

Morality

So by that calculation, cancellation now could save a total of about £4bn over the next five or so crunch years of what they like to call "fiscal consolidation".

Now, you can make a powerful argument against replacement of Trident on the basis of military priorities, defence strategy, long-term costs or morality.

But what you can't do is pretend that cancellation of Trident's replacement is the way to get a structural deficit under control, which was most recently estimated at an annual £67bn.

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• - What's this?

More than 600,000 Scots are represented by the brothers and sisters who gather in Dundee's Caird Hall today for three days of the Scottish Trades Union Congress.

You can gauge what's on their minds from the 110 motions.

There's concern from the Musicians' Union about the unreliability of digital radio reception. There's a call to combat workplace discrimination against stammering and stuttering. Lorry drivers with disabilities need better services and facilities, comrades will be told.

Dundee TUC wants an Allotment Strategy for Scotland. Among the 11 listed reasons: "a therapeutic environment beneficial to mental health... educational opportunity in horticulture... and they have an inherently democratic ethos based on co-operation and mutual support".

One of the more significant discussions trade unionists will have in Dundee could be about their own future. It seems that their recruitment among young workers is poor. Only 16% of men aged under 24 are union members and only 9% of young women.

While some of its members are woven into the fabric of the Labour Party, the STUC remains politically non-aligned. Yet it's no surprise to find number 110 simply titled: "Do not support the Tory party".

Militant rhetoric

I digress. The bigger ticket issues being raised for block voting include railway safety, with discussion of the twin strike strategy currently under way.

Eleven of the motions raise general concerns about the future of public services, and as many raise specific ones as they look to the axe falling on budgets.

They talk of protecting services, jobs and pensions. But do their members have the militancy to back up the indignant rhetoric? That will be a key issue in Dundee, and we won't know the answer for a few months yet.

What we do know, so far, is that companies that used to be nationalised - in utilities, rail and British Airways - have been the most militant in striking against the private sector squeeze. The public sector is even more highly unionised.

Significantly, the tone of these STUC motions is not to accept that the axe needs to fall. They can be expected, for instance, to support the Educational Institute of Scotland in "deploring the emerging political consensus on the need for savage public spending cuts, ignoring alternative responses, including increased taxation and the possible abandonment of costly and controversial programmes such as Trident, identity cards and the war in Afghanistan".

Budget squeeze

That consensus view seems to be gathering pace, at least if you look at responses to Holyrood's investigation into how the budget squeeze should be handled.

Raising tax, of course, is a very limited option for MSPs. And if the Treasury fails to meet its economic growth forecasts, as many believe it will do, Professor David Bell - of Stirling University, and specialist adviser to the Holyrood finance committee - this weekend told the Politics Show Scotland that the cuts could go as deep as 20%.

The Sunday Times this week has a very rough totting up of the plans to cut jobs across the public sector so far under way, or at least being publicly discussed. It reaches a total of 225,000, and that's without paying much attention to Scotland.

Professor Bell has written one of two significant contributions to the committee's deliberations on the budget squeeze which have just been published.

In one, the Centre for Public Policy for Regions at Glasgow University offers advice drawn from comparable "fiscal consolidations" in Finland, Canada, Sweden and Ireland.

They highlight the role of leadership "in order to make the unpalatable seem inevitable". Cross-party consensus also helps. But to win public trust in the process, the report argues information on public spending has to be freely available. If it's distorted or concealed, trust in the process of implementing cuts can be badly harmed.

And it's pointed out that much important information about outputs from public services is not so much concealed as non-existent.

Slash capital spending

They say international experience points to two big choices. One is whether to cut capital or revenue spending. In the 1990s, when the Finns successfully steered their way out of a trough, they deliberately protected capital, on the basis that it would be vital to securing growth when it returned.

The UK, it's pointed out, has inadvertantly tended to slash capital spending when times get tough, because that's the easy thing to do politically. And that's how it's looking again.

The other factor that helps get countries out of crises is some external source of discipline. That was the International Monetary Fund in 1976, when it bailed out Britain.

The debate about Greece's dire position at present is: who applies the discipline, and how to make it stick? Will the European Central Bank be given the tools to apply iron resolve, or will it descend into a Council of Ministers' fudge?

Professor Bell looks most closely at the other big choice the CPPR raises - between universal and targeted services.

He reflects criticism that has been aimed at Holyrood administrations for extending free care and bus travel for the elderly, free prescriptions, free bridge tolls, the abolition of the student endowment, and so on, as helping out those more affluent people who might otherwise be able to pay.

These are "at least partially regressive", and once universal benefits are offered, they are "extremely difficult to withdraw".

Holyrood U-turns

Professor Bell's suggestions are technical, but with radical implications. One is for a ban on legislation that is open-ended in cost, meaning new laws must define ways in which costs can be capped.

Another is for all new laws to show how they affect richer and poorer communities in Scotland. That would cover new laws. In the meantime, he says the depth of the cuts, and the tight timetable, mean the Scottish government has to reconsider more means testing.

And as Holyrood has committed to more universal benefits than the rest of the UK, it would have more U-turns to perform.

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Things could only get better, surely?

No, not a reworking of the Blair campaign for 1997. It's about the construction industry.

It took such a hit at the start of the recession that there must be some signs of things looking up.

Failing that, there must be some signs of looking to a time when things will look up.

But mine down into the detail of the Fraser of Allander/Scottish Chambers of Commerce survey out this week, and reflecting the first, very cold quarter of the year, and there are some chilling figures.

The number of construction companies increasing their investment:
none.

The number that expect to increase investment in the next three
months: none.

No wonder publication was swiftly followed by news of the demise of Bone Steel in Wishaw, a steel construction and supply company that had seen the market fall 50% in 18 months. It took 118 jobs down with it.

Big Impact

In wholesale distribution, the number investing: again, none.

In manufacturing, a large category where investment levels have a big impact, the number of firms increasing investment is nearly 18%, but the number expecting it to fall is 24%.

Now, these surveys can be misrepresented to make it seem everything is rosy or gloomy, when they are based on balances between those with improving figures and those with declining figures.

And in almost all categories, there are those who are seeing things get better.

But that investment figure is significant for what it means for the companies that would supply investment goods, and also for the broader lack of optimism beyond the short term.

Fuel cost brunt

Construction firms can see the public sector contracts that have sustained some are now looking very uncertain after the election, when the deficit crunch begins to bite.

Five per cent see an upward trend in public sector work, while 75% report it's falling.

In the private commercial category, 48% see declining trends in expected contracts, and none see improvements.

Construction firms reckon they're working at only 65% of capacity.

Mine a bit further, and the alarming numbers go on.

In retail distribution, optimism is up for 3%, and down for 57%. It's facing the brunt of the fuel cost increases.

Skills shortages

In tourism, hotel occupancy is at 47%, the lowest for 10 years - though that's perhaps the most obvious victim of harsh winter weather.

So what about trends in bookings? Even with sterling weak, 20% see improvements, and 60% see deterioriation.

Even where people are recruiting, there are some signs of skill shortages.

In tourism, for instance, seasonal business means half of firms are recruiting early in the year.

But 15% are experiencing recruitment difficulties - more than you might expect in the current state of the jobs market.

In construction, 20% of firms were recruiting during the survey period last month, but only to fill vacancies. None are expanding their payroll.

And none of them were finding difficulty in finding new employees.

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• - What's this?

The prospect of looming spending cuts underlie and overshadow every other aspect of the Westminster election, but without much sign of parties getting into the detail of where the axe is going to fall.

There might be a bit more candour at Holyrood from Tuesday, as the Scottish Parliament's finance committee starts an inquiry into the implications of the budget squeeze.

And if politicians aren't willing to offer detailed proposals about who is going to feel the most pain, then the non-politicians are holding back as well.

In written submissions for the inquiry, there are plenty of groups wanting to protect what they've got.

One of the more interesting is the Association of Chief Police Officers in Scotland:

"There are varying views on the impact of recession on crime," it said.

"However, there is one view that crime might increase and this will impact on public fear of crime, confidence and feeling of safety.

"Both the perception and reality of crime have the real potential to impact on wellbeing and health.

"It is therefore important that there is clear understanding of the complex relationship between one sector's efforts and the impact it has on much wider national strategic issues.

"The disproportionate reduction of investment in one area might impact outcomes for others."

Universal services

It's harder to find those with suggestions of what we can do without.

Yet it's a political and government body that sums up the prospects most starkly.

The Convention of Scottish Local Authorities sets out two of the areas to be considered:

It said: "Within a reduced allocation of resources, can Scotland still afford universal services?

"We have found it more difficult to promote a more radical debate about the responsibility of the state, individual and community and this may be required in the longer term."

Cosla also asks about early intervention.

If the priority becomes quick gains in cuts, what happens to programmes such as pre-school spending, from which the results - in educational attainment, tax revenue and even in lower imprisonment costs - can sometimes take decades to feed through?

Local, for consumers

The most forthright views about change in public spending come from business.

The Scottish Chambers of Commerce argue that productivity in Scotland's public services lags not just the private sector but also the rest of Britain.

It highlights the relatively generous pensions in public services, and it recommends "a shift towards a consumer orientated, locally focused model for public service provision that is the norm across Europe".

"Service providers should be independent of government and accountable to service users instead, who should in turn benefit from greater variety of provision," it said.

"The government role would be limited to a financial and regulatory role to ensure that access remains universal."

CBI Scotland is urging more contracting of services, and particularly back office, to the private sector.

It cites examples of improved efficiency, from team-based rubbish collection to reform of Glasgow City Council and management of the Faslane naval base.

Abolish libraries?

It's only a management consultancy, 4 Consulting Ltd, that offers concrete examples of what could be cut.

The list starts with plastic surgery on the NHS, and moves swiftly onto public libraries.

It suggests that instead pubs and cafes could become the places people leave books they don't want, for others to pick up.

Its other suggestions are hardly likely to solve Britain's deficit problems; fine lorry owners for parking on pavements, using the funds to pay for pavement repairs.

And why not limit the size of trucks on British roads, so that each one can do less damage?

Clearly, 4 Consulting Ltd is not standing for election.

If you're interested in the future tax powers of the Scottish Parliament, you can read about a from one of Scotland's leading economists and one of its leading academic lawyers, published by the Reform Scotland think tank.

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They either feature more sound, fury and heat than light, or they're dominated by superficial slogans, gaffes and sidetracks into non-issues: Election campaigns are rarely opportunities for serious political debate.

Not this time though.

The debate about taxation and spending, which has dominated the past two weeks, includes some serious, heavyweight stuff.

The key row, so far, involves an increase in only one tax - National Insurance being a rather complex one - and a share of revenue which is dwarfed by the scale of the deficit challenge.

But it raises a much wider range of questions, about how to sort out the public finances; which tax increases and spending cuts would hurt least, and what exactly is an efficiency saving?

The easy bit was establishing that the national insurance rate rise is a disincentive to job creation. Nobody has denied that, including Labour politicians trying to defend the decision.

There's not much evidence of the job impact. And if the Treasury's studied the issue, it's not publishing it.

After 11 years

One study of the impact of a 1p rise in employers' national insurance contributions came from Tory-leaning Policy Exchange think tank.

It implied that the policy would cost 750,000 jobs, but not even the Conservatives seem to be treating that figure as credible.

Instead, they're citing figures from the Centre for Economic and Business Research (CEBR), carried out last year for the Federation of Small Businesses.

Its reckoning: In small and medium-size businesses, employment levels would be 57,000. And extrapolating from that to include larger firms, Tories say it would cost 96,000 private sector jobs.

That's before the impact on the public payroll of NICs increasing for government employees too.

Look at the small print though - that 57,000 figure would be the gap in employment projections with and without the NICs increase, by 2021.

They're not current jobs lost, but jobs that wouldn't exist 11 years from now. And the impact on the compound growth rate? It would be 0.02% lower by 2021.

As the Tory plans are only a partial reversal of the Labour ones, they say they could save 58,000 of that figure.

What they're not highlighting is that their own plans for a National Insurance increase would cost - according to those CEBR figures - around 38,000 jobs across Britain.

Treasury clutches

But that's only one calculation. The NIC rise may not be as big a disincentive as some business-people say.

James Caan, of Dragons' Den fame, for instance, says an extra £15 per month would not affect him in deciding whether to hire a new employee.

The point is made by those who wish to stop next year's rise (or who favour the Conservative option of reversing only part of it) that the same money kept out of Treasury clutches could be better and more efficiently used by private companies.

It could go into profits, investment or higher wages.

The Institute of Fiscal Studies reckons the impact on higher wages, feeding through into income tax, could even pay roughly £2bn in additional revenue for the Treasury, but only over the longer term.

Hard-working families

Politically, Tories have succeeded over the past two weeks in establishing that Labour's plans would cost jobs. But recent days have seen the complexity of this issue teased out.

And the impact of finding 'efficiency savings' to allow an incoming Conservative government to claw back part of the NIC increase is highlighting the impact of less government spending.

The argument from Tories is that £6bn of savings can be found, in much the same way that any household budget can take out one pound in £100.

They assume that's what British households have had to do in recent months, when in fact, low interest rates have increased spending power through the recession, at least for those remaining in jobs.

Without specifics, the Tory efficiency savings include cancellation of IT projects, freezing non-frontline public sector recruitment and better management of government property.

What is becoming clear is that that, too, would cost jobs. Some of them would be in public sector administration - perhaps the easiest hit of an election campaign.

It's worth remembering two things about those faceless people who manage, for instance, hospitals - they are people in "decent, hard-working families" too (well, let's be charitable and assume most of them are).

They pay taxes, and if they become unemployed, they'll add to the government's welfare bill.

How much would they add?

Well, here's one reckoning as a guideline, returning to the CEBR figures suggesting 57,000 private sector jobs not created as a result of the 1p rise in employers' NICs, adds that the welfare costs of that would add £900m to government bills.

Let's also remember that administrators can run things more efficiently than they'd be run if they weren't there.

They may not always be models of efficiency and rational planning. But working, as I did, in the newspaper industry, I know what it's like when management is pared back too much, and I wouldn't recommend it.

The other factor that's becoming more clearly part of this vital debate about the future of public spending: It's not all civil servants.

Government contracts sustain private businesses. Nobody knows how many IT workers would lose out if public sector IT spending is put on ice, but the number would be substantial.

These people also pay their taxes, and would cost more in welfare if they were on Jobseekers' Allowance.

IT fiasco

Then, what about a recruitment freeze?

We've seen them before. What tends to happen is that the people who leave are the most talented ones, with the best prospects of moving to a better job elsewhere, and they were often the ones doing the most important jobs.

The gaps they leave are more than statistics and potential savings.

And a freeze on IT projects, in particular, could deliver short-term savings but stall longer-term efficiency, whatever the history of public sector IT fiasco.

These are not party political points. We now have an admission from the three main UK parties that jobs will be lost in the private and public sectors, whatever happens.

And we're getting closer to an understanding that management of the public finances over the next few years will be anything but simple.

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Aberdeen: it's warmer than you'd think, only a week after a snowstorm.

And with an economy in rude health - relatively speaking, at least - I've been sampling opinion on the dominant economic issue in the election campaign.

My results have a margin of error of up to 100%. That is, they may be wholly wrong.

But if they point to anything, they suggest people recognise there are tax increases on the way.

And they know they're going to have to shoulder some of that burden. They're not just looking for others to do so.

They seemed more willing to admit than for many years that they're going to vote Scottish Conservative.

And that didn't include any Tory stereotypes. Even the party's opponents in Aberdeen have noticed that from their canvassing.

Being Tory in Scotland may at last be losing its stigma.

The message that seems to be working among those willing to vote Conservative is "it's time for change".

No-one I spoke to mentioned whether they like David Cameron or not. Nor did they talk about Gordon Brown.

Personalities don't seem to be the issue.

I asked people to make the big choices the next Chancellor will face - higher taxes or lower spending: higher income and payroll taxes or more on VAT: tackle the deficit now or wait a bit while the recovery takes hold?

In several of these cases, they made the opposite choice to David Cameron and George Osborne, though they may not have known it.

Though it's dominating headlines, few understand National Insurance.

And despite being opposed to Tory policy, these same people were still willing to back Conservatives.

That much should serve as an election time reminder: we expect the parties and politicians to be consistent, and we criticise them if they're not.

But voters are persistently inconsistent in what they want and expect, and that gets tolerated, because - for a month or so - they're the ones in charge.

Now, there's a long way for Tories to go if they're to get a significant breakthrough in Scotland.

But on this unscientific evidence from Aberdonians, perhaps voters are prepared to vote for the party that can establish itself as representing change, whatever else it offers.

Or - realising tough times are ahead - perhaps they'll back a party that will then do things they don't want.

That way, they get to blame it.

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A new house built after this October will have to conform to building standards 70% more efficient than those of a house built only 20 years ago.

According to industry group Homes for Scotland, it has already achieved savings of 60% on that baseline, as it makes the case for the Scottish government .

It's claiming insulation, sound-proofing and improved security (better quality doors, windows and locks) are adding thousands to the cost of construction, at a time when the industry has been going through a recessionary nightmare, and when demand for new homes is expected to take off again, even if the ability to pay for them is somewhat constrained.

The new standards, published on 6 April after much consultation, are no surprise, and an important part of getting to Scotland's exacting targets for cutting emissions. We've barely begun to address the role of heating in the climate change challenge, preferring to talk electricity generation and transport.

Rather than marvelling at how far construction standards have improved in 20 years, more significant seems to be what those improvements tell us about poor standards back then.

Cold country

Unlike cars, with a lifespan that means the technology now being developed can come to dominate the roads within ten years, we're still stuck with poor building standards of the past, and will be for decades to come.

Despite being a cold country, and despite the lessons to be learned from Scandanavia, Scotland opted for many years to build cheaply for cheap energy rather than less energy.

It was helped by a the strength of a property market in which builders didn't have to offer energy efficiency measures to entice buyers.

Indeed, a Scottish government survey a couple of years ago highlighted the extent to which builders have rarely done market research to find out what prospective customers wanted.

Customer satisfaction

It found, through the boom years in particular, that buyers would buy what they were offered, without being asked if they would like something different, better designed, more appropriate or more energy efficient. The builders' idea of market research was to send new owners customer satisfaction surveys once they'd moved in.

Homes For Scotland now wants the Scottish government to turn more of its attention to reducing energy use and improving efficiency in the existing housing stock. And with social housing having been through a significant upgrade in recent years, it is now the private housing stock that is in most need. That includes those social rented homes sold off to tenants.

Many private owners won't or can't pay for the upgrades their homes need. And there's not much public money around to help them.

Curfew confusion

What to do about drink-fuelled violence? It's an issue with which Aberdeen councillors have most recently struggled, to end a late-night experiment curtailing revellers' access to clubs.

Though it had the support of ambulance crews, it wasn't found to be making much difference, other than frustrating tanked-up Aberdonians.

A recent conference of the Royal Economic Society heard how the skills of the dismal science have been applied to this same question, showing at least that it's much more than a Scottish or British phenomenon.

The research comes from Sao Paolo in Brazil, comparing the 16 out of
39 municipalities that adopted so-called 'dry laws' - pubs and clubs being required to close at 11pm - with those that did not.

The outcome shows that imposing a curfew on late-night drinking cut the homicide, battery and death by car accident rates by around 10%.

Surely this calls for a fact-finding mission by Aberdeen councillors?
Or maybe not.

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Just where is Britain's north-south divide?

It has been long-contested, and is less often these days the subject of economic or political debate.

But with an election imminent, it may be about to make a comeback, not least because the politics of Labour versus Conservative seem to divide so strongly between north and south - with David Cameron's appeal struggling, on past evidence, to extend north of the Trent.

Of course, there was always a simplicity to discussion of north and south.

South Wales didn't fit that comfortably into the prosperous south.

And the view from New Labour was that this analysis failed to understand the pockets of prosperity in the north and the pockets of deprivation in the south, notably in parts of London.

We've now got new research taking the long view over a century and more.

And it serves to underline the economic dominance not so much of the southern half of England as a much smaller portion of the country, in the south-east.

War damage

Economic historians Frank Geary and Tom Stark have just published their reckoning on gross domestic product as it has grown in different regions and nations of the UK.

They've found that in the 40 years after the onset of the Great Depression in 1931, there was some decline in regional inequality.

This was particularly strong in the 1931-51 period, so it may have had something to do with the Second World War war effort and damage.

The 40-year narrowing may also have been helped by active regional policy.

But after the mid-1970s, the impact of accelerating industrial decline, the rise of the financial sector focussed on the City of London, and arguably the dependence on market economics rather than regional policy that followed the election of Margaret Thatcher, that narrowing of regional inequality went into reverse.

Trickle-out effect

Both productivity and prosperity became less equal, found the University of Ulster study.

Yet it was in this period of least convergence between regions, after 1971, that all regions found growth was at its strongest.

That raises some interesting questions about the way the UK economy works; when growth is maximised, it's particularly strong in the south-east, so what does that tell us about the importance of the south-east to providing a 'trickle-down' or, more accurately, a 'trickle out' effect?

What would it take for regions and nations outside the English south-east to grow more rapidly, without dependence on the London area to provide that dynamo?

And if the financial services sector is now permanently hobbled, having provided much of the growth for Britain over the past two decades, does its weakness mean there will be less inequality between the nations and English regions than we've seen through the 21st century?

And if the outcome of this research is to create an economic picture of 'south-east England versus the Rest', it's also worth noting there's some interesting movement between 'the Rest'.

Over the twentieth century, the biggest growth in GDP per worker relative to the UK average was Northern Ireland, with Scotland coming a distant second.

The losers included Wales and the south-west, but the region most clearly losing ground was northern England.

Devolution dividend

That's the economic historians' take. What of the future, and what will drive the relative performance of different parts of the UK?

The spread of digital technology and superfast broadband, perhaps, giving every region equal access to markets?

The progress or sclerosis of the transport system, with or without high-speed rail? The concentration of skills and educational assets, at which Scotland starts with an advantage?

Or could it be driven by political choices; a devolution dividend helping Scotland, Wales and Northern Ireland (and London?), allied to a return to English regional policy.

We haven't heard much about that for decades.

There have been hints that we might find out more in this election campaign.

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So business leaders want lower taxes?

We've got a clutch of now joining the procession of business critics of the plans to increase national insurance contributions (NICs).

Clearly, this plays big because it's become a major dividing line between the parties vying to form the next UK government.

The Lib Dems have defended Labour's decision in criticism of Conservatives, and the SNP has opposed the NIC increase, in line with the Tories.

The way it's been portrayed has suggested Tories are gaining business support.

That's sort of half true.

It's more like the Conservatives have aligned themselves with a position that business had already taken - quite vociferously and without any obvious political motivation - after the NICs increase was announced.

Two big questions arise.

Are the Conservatives on the right side of the argument? And how much difference does it make for a party contesting an election to have the support of business leaders?

The strength of the argument against the NICs increase is that it can be argued it's a 'tax on jobs'.

This is not business arguing against the bank bonus tax or the new 50 pence top rate for earnings over £150,000.

Yes, they complain about those as well, but most in business and Tory strategists can see that arguing for reversal of those measures would risk unpopularity.

NICs, on the contrary, represent a direct tax on payroll, and a disincentive for job creation.

On the backfoot

The counter-argument deployed by Labour is that this is one of those unpalatable measures the country is going to have to accept if its public finances are to be brought under control, and that the introduction is being delayed until next year, when growth should have been more firmly re-established.

The exchanges this week have put Labour on the backfoot, while Tories hope the momentum that has eluded them in recent weeks may have turned back in their favour.

But Conservatives have a tricky task now of squaring a circle of their own design: a reversal of a tax increase, while being toughest on the deficit, and claiming the NICs reversal can be paid for with more efficiencies when they themselves have conceded there has been over-reliance on the claims of what efficiency can deliver.

Tainted brand

How much difference can this make? The support for a party's policies of the captains of industry can be welcome, if they bring credibility.

But it's notable that nobody seems to be seeking the support of financiers in this dispute, as the bank brand is rather tainted.

It's worth asking: from a voters point of view, how much credibility does business have?

In 1997, the business support for Labour was a signal that a tainted party brand had been changed.

It's less clear that anyone doubts there is significant support for Conservatives in senior business circles, so they have less power to influence voters into thinking the party has changed.

In 2007, the SNP, with no experience in government, had the same task that Labour had in the 1990s, in finding outsiders to underscore their credibility.

Big business endorsements were all the more important in that campaign.

Sir George Mathewson, ex-chairman and chief executive of RBS (in days when that meant rather more prestige), and former Scottish Enterprise chief Crawford Beveridge, came out for independence.

Another former SE chief executive, Robert Crawford, became an SNP candidate, and Stagecoach's Brian Souter weighed in with a £500,000 campaign donation.

Together, they built the message of credibility and the sequence of their announcement effectively built campaign momentum.

Weighty support

But in the current election debate, there's a challenge that can be thrown back to business.

It argues against NICs, and it complains (with less prominence) about the new tax disincentives to high earners.

Business is to the fore in demanding that public spending should be brought under control.

Yet look at the list of tax breaks and spending programmes that business is simultaneously demanding.

Last Wednesday, the Scottish Chambers of Commerce launched the manifesto it would like to see adopted, most of the measures in line with other business organisations, including opposition to the NICs increase.

The list of transport projects alone was huge.

As a lobby group, business can bring weighty support and credibility to a political party. But it needs to be consistent as well.

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Despite sitting in their individualised metal boxes, motorists present a formidable collective brake horse power.

And with voting intentions to the fore over the next month or so, they've been given plenty more ammunition for complaining.

Thursday has seen a rise in petrol tax of 1p per litre, with more to follow later this year and again at the start of next.

But there's more. The requirement to include more biofuel in petrol and diesel is increasing at least some suppliers' prices by around 0.8p per litre.

We have now seen the removal of a biofuel tax relief, though there's still a 20p per litre advantage for reprocessed cooking oil.

And from 15 April, the Renewable Fuels Agency implements the legal requirement to ratchet up the content of biofuels in transport fuel. It's been 3.25%, and it's rising to 3.5%.

That is likely to make petrol and diesel more expensive, either through the processing costs or through the requirement to purchase Road Transport Fuel Obligation certificates.

If fossil fuel prices rise, however, that can make the biofuel elements relatively cheap, as was thought to happen the oil price spiked in 2008.

Gas guzzling

The industry is also being hit by a new showroom tax designed to steer buyers towards models that pollute less.

If you choose a gas guzzling 4x4 with automatic gearbox, you could find your car tax disc costing an eye-popping £950.

That only lasts for the first year, and then it's cut in half. But there's still a wide differential.

If you choose something with less than half that top threshhold for emissions, you could find the first year's car tax disc reduced to zero.

Of course, the idea is that this should skew sales towards lower emissions. But if you take last year's sales, the industry reckons that the top whack would be paid by fewer than 2% of buyers, while the zero rating could have affected 7%.

And it's not all about demon 4x4s.

Some of them rule the road with relatively low emissions, so there's a wide variation in the tax that gets levied.

Indeed, there are signs from manufacturers that they're already responding by adjusting design to make cars more tax-efficient as well as fuel-efficient.

Swerving potholes

The bad winter has helped 4x4 sales.

And my guess, based on my own experience of swerving round Glasgow, is that the appearance of potholes and the disappearance of public funding to mend damaged roads will help 4x4 sales further.

That's being helped in this globalised industry by the US pressure being exerted to raise its average miles per gallon from 25 to 35, within the next six years.

The industry faces a new challenge from the end of the scrappage scheme, also known as bucks for bangers or cash for clunkers.

With a £1,000 grant from the UK government and as much from the industry, for replacement of a car aged over 10 years with a new one, that helped drive nearly 400,000 sales between last May and this week.

What surprised me is how many owners of old cars were up for buying brand new ones.

According to a survey carried out last October, more than half of those involved in the scheme had never bought a new car before.

Presumably very low interest rates made a big difference.

Costs and risks

But there's a problem, in that the scheme probably brought forward car replacement transactions.

Dealers are concerned about a dearth of customers to be had in the next few months.

For manufacturers, the scrappage scheme helped put several English assembly lines back into full production.

But the industry has reorganised to cut costs and risks by holding far less stock.

If you want to buy a new car now, the chances are you'll have to wait far longer than used to be the case, as it will have to be built for you rather than being sourced from a very large, crowded car park.

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He's faced every conceivable challenge in deliveries between Pencaster and Greendale
- recently including his cat, Jess, rendering an address illegible by smudging it with a wet paw.

But now, it seems the 21st Century is at last bringing Postman Pat a bracing blast of market competition.

My sources at the McBebees channel tell me it's part of a drive to include business education in the pre-school curriculum, helping children understand the pressures under which adults have to work.

That's why the next series is to include competition from a rival mail delivery service provided by a new character, Justin Thyme.

Little to deliver

He will cream off the best of the business market and ignore the social dimension of Postman Pat's link to every household on his delivery run.

The growing use of email by local businesses in Pencaster will be seen to leave the iconic mailman and his black and white cat with little to deliver.

He is to diversify into new delivery services, such as flowers and postal banking.

Pat is also to be portrayed as a trade union activist. Young children will be asked to choose whether they support him in a national ballot and subsequent strike action.

The storyline will explain this is a protest against pressure from Mr Goodwin, the sorting office boss, for faster delivery rounds combined with reduced food rations for feline support staff.

Famous van

Postman Pat was first broadcast in 1981, when it used the livery of the Royal Mail on the cartoon character's uniform and van.

Since that branding agreement was ended, he is now seen working for the fictional Special Delivery Service, which includes a helicopter facility as well as his famous red van.

Otto Maittsort, a spokesman for the French-owned programme-makers PremierAvril, confirmed the changes, commenting: "Postman Pat has helped young people understand the adult world for 29 years, but it's time to bring him up to date.

"He'll now helping a new generation face the realities they will later encounter in the 21st Century workplace".

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