5th November 2019

Written by Juan Palenzeuala, Associate

Edited by David Gaffney, Partner

Good morning,

With a population of just 5.5 million, Scotland has roughly the same number of drug overdose deaths as Germany, a country more than 16 times more populated, with some 83 million citizens.  

The situation is truly a health crisis, and it is not getting better: overdose deaths in Scotland grew by 27% to 1187 in 2018, and the numbers have been steadily growing over the past decade. Nine in every 10 of these deaths are associated with opioids, while seven in 10 involve benzodiazepines. Significantly, 85% of fatalities involve more than one drug, according to the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA). 

In response to these stark statistics, a public enquiry was launched by the Scottish Affairs Committee of the House of Commons earlier this year, to examine the nature of the issue and recommend a policy response. Afinal report, which was published yesterday, focused strongly on one key policy: decriminalising the possession of small amounts of drugs for personal use. The cross-party committee also concluded that the current approach, which currently consists of treating drug use as a criminal matter, is outdated and counterproductive. Perhaps the most contentious point, however, is the committee’s support for consumption rooms where addicts can take drugs in a sterile and safe environment under professional supervision. 

On the face of it, this would reduce the risk – and costs – of taking drugs, which some might be concerned could lead to greater levels of consumption. The reality, though, is that unlike other goods, illicit drugs have a fairly inelastic demand. That is, their consumption levels react little to changes in prices (or costs, in this case). Several studies have confirmed this, particularly for opioids and benzodiazepines, the two types of drug that affect Scotland the most. In this context, decriminalising drugs and providing safe environments for their consumption is a strong evidence-based policy that is worth at least a try. It could save multiple drug users’ lives and transform the lives of the friends and family members whose own existence is so adversely affected. 

Nonetheless, efforts so far to do something along these lines have been squashed. Last year, a plan for a similar pilot facility in Glasgow was blocked by the Home Office (£). It is extremely difficult, it turns out, to legislate on an issue that has such disparate effects across the different constituent parts of the United Kingdom. England’s drug-related death rate, for example, is 66 per million inhabitants, significantly lower than Scotland’s 218 deaths per million citizens. However, with drug misuse legislation a matter reserved for the Westminster government and an intransigent Home Office so far unreceptive to radical change, the argument for devolved drug powers for Scotland appears to grow ever stronger. 

News

Sir Lindsay Hoyle was elected as the new Speaker of the House of Commons yesterday, succeeding John Bercow who held the role for more than a decade. Hoyle, who strongly refuses to share how he voted on the Brexit referendum, vowed to bring calm to the chamber.

A car rationing scheme was implemented in Delhi yesterday after an air emergency was declared in the Indian capital due to severe air pollution. On Sunday, the Air Quality Index (AQI) was at its highest point this year, at over 900 points (a score of 500 qualifies as a "hazardous" category). In comparison, London on the same day had an AQI of around 50, while Edinburgh of around 20, both classified as moderate and good respectively. 

The US has formally notified the UN of its withdrawal from the Paris Agreement. The notification begins a one-year process of exiting the accord, which brought together 188 nations to combat climate change. 

Business and economy

IAG, the parent company of British Airways and Iberia, agreed yesterday to buy Air Europa for €1bn, as it seeks to open up the South American transatlantic market and turn Madrid into Europe’s next hub airport. Michael O’Leary, CEO of Ryanair, scrutinised the deal, saying that it would restrict competition in the European market. 

The US Government is said to be considering whether to remove tariffs on $112bn of Chinese imports as a concession to seal a partial deal that would pause the trade war as early as this month, ahead of the presidential election next year. In return, Washington is also expected to demand stricter provisions for the protection of intellectual property for US companies, certainty on the scale of Chinese purchases of US agricultural products, and a signing ceremony for the agreement on American soil. 

OPEC is expected to agree on further oil production cuts in December, according to Iran’s oil minister Bijan Zanganeh. This will come as a counterweight to the expected weaker demand in the coming months. 

Markets

What happened yesterday?

New optimism on the easing of tensions between China and the US and positive corporate earnings sent global equities, and American stocks in particular, to new record highs on Monday. 

The S&P 500 advanced 0.4%, extending last week’s all-time closing high for the index and driving a 22.8% rise so far this year. 

In Europe, the Stoxx 600 was one per cent higher at 403.41, as Germany's Dax jumped 1.35% to 13,136.28 and the French CAC 40 climbed by 1.08% to 5,824.30. Meanwhile, the FTSE 100 was up 0.92% at 7,369.69. 

What's happening today?

Finals

AB Foods

Up Global

Interims

Castleton

Mxc Capita

AGMs

Aew Uk Murray Inc

UK Economic Announcements

(00:01) BRC Shop Price Index (09:30) PMI Services

Intl. economic announcements

(10:00) Producer Price Index (EU) (13:30) Balance of Trade (US) (14:45) PMI Services (US) (14:45) PMI Composite (US) (15:00) ISM Non-Manufacturing (US)

Columns of note

Writing for the Financial Times, Gideon Rachman argues that we are entering an age of democratic deadlock, with a number of countries falling in a situation where no party can acquire enough seats in the legislature to govern effectively. Political radicalisation is a big element to blame, as it has made coalition-building increasingly difficult, says the author. Yet above all, issues such as identity are now on a level which we have not seen before. This is a warning sign for Britain. (£)

In The Times, Alistair Osborne warns of the ethical costs and risks involved with investing in Aramco. In addition to the political baggage attached to the company, Aramco shareholders will also be a tiny minority with zero clout, he says. Around three per cent of the company will be put on sale by the authorities on the local Tadawul exchange and the proposed valuation ($2 trillion) is also potentially way off the intrinsic valuation of the business. Bernstein, an independent research firm, sets the fair value for Aramco between $1.2 trillion to $1.5 trillion.

Cartoon source: The Times

Did you know?

Peter Mayhew played Chewbacca in every Star Wars film other than Star Wars: The Last Jedi, but was still listed in the credits of that film as a "Chewbacca Consultant". 

Parliamentary highlights

TODAY

House of Commons Oral questions Foreign and Commonwealth Affairs (including Topical Questions) General debate Opportunity for Members to make short valedictory speeches Matters to be considered before the forthcoming Dissolution Adjournment Provision for special educational needs and disabilities in Suffolk - Sandy Martin House of Lords Introduction(s) Lord Choudrey and Baroness Ritchie of Downpatrick Oral questions Prevention of malnutrition among people in health and social care setting - Lord Aberdare Guidance to the housebuilding sector in order to reduce of the number of accidents within the home - Lord Jordan Assessment of the recommendations of the report of the Digital Competition Expert Panel ' Unlocking Digital Competition' - Lord Clement-Jones The appearance in England of tick-borne encephalitis virus and advice given on Borreliosis bacteria and associated Lyme disease - Lord Greaves Civil Partnership (Opposite-sex Couples) Regulations 2019 - Baroness Williams of Trafford Short debate Impact of the convergence of gaming and gambling on gambling-related harm in the UK - Lord Chadlington Scottish Parliament Topical Questions (if selected) Stage 1 Debate UEFA European Championships (Scotland) Bill Election to the Scottish Parliamentary Corporate Body Committee Announcements

Members’ Business Save Loch Lomond – Ross Greer TOMORROW House of Commons No business is scheduled

House of Lords No business scheduled

Scottish Parliament Parliamentary bureau motions

Member's business World Day Against the Death Penalty

Portfolio questions Finance, Economy and Fair Work

Scottish Conservative and Unionist Party Debate The Resilience of Scotland's Ferry Network

Scottish Conservative and Unionist Party Debate Curriculum for Excellence

Member's business UN Year of Indigenous Languages and European Day of Languages