Policy Research Media Morhamburn

Last October, while walking my daughter up The Mound and on to school, we passed cold-numbed journalists and camera crews all clutching cups of franchise-chain coffee to ward off the October chill.

They, the representatives of both the British and international media, were huddled outside the old Bank of Scotland HQ, ready to report whether or not Scotland’s financial institutions had been saved – or if the nation risked being sucked into some credit crunch generated maelstrom.

In the end, total economic collapse was averted. But not before Scotland had to endure the humiliation of seeing ‘its banks’ – Halifax Bank of Scotland merged with Lloyds TSB, and the UK Government effectively assume almost total control of RBS.

Scotland’s financial sector might have been rescued – but we have yet to really calculate the impact of the credit crunch on the national psyche or assess its effect on the country’s international reputation for fiscal prudence.

Still, one year on it could be argued that Scotland is in slightly better shape than we could ever have dared imagine last October. The construction industry has certainly suffered, certain sections of the financial services industry are still shedding jobs and belts are still being tightened. However, there are signs of optimism – ‘green shoots’ emerging from among the credit crunch cracks. The housing sector has proved rather more resilient than expected with prices now bouncing back, the spectre of mass unemployment has not been realised, and Scotland is, despite everything, still managing to attract financial sector jobs rather than repel them: think Tesco Finance and HSBC. Full-blown depression has, it would appear, been averted.

Economic recovery, though, is still a long way off. And by the time our bankers do raise their chastened heads above the parapet once again – they might just find the world a much-changed place, for the world’s financial axis (and its education one, too, according to last week’s world university rankings) appears to be shifting far to the East. Still – it could all have been much worse.