That is the key fact which underlies the welter of figures, claims and counter-claims of recent days about Scotland’s economic prospects as an independent nation. The discussion paper I prepared for the Scottish Cabinet around a year ago, and which is now in the public domain, demonstrates just how seriously the Scottish Government is approaching the task of managing Scotland’s finances as we look forward to the prospect of a Yes vote in the referendum next year
The document is a serious, hard-headed look at some of the challenges and opportunities that will be presented by having control of all of our own resources for the first time in three centuries.
That is a serious responsibility, and the paper shows how thoroughly we are preparing to meet that challenge. But, as the document itself says, “Scotland has nothing to fear and everything to gain” in grasping the opportunities of independence.
That is because the latest official figures published this week back up that fundamental, underlying fact that Scotland is a wealthy country.
The latest Government Expenditure and Revenue Scotland (GERS) statistics which came out on Wednesday show that in 2011-12, Scotland had a relative surplus compared to the rest of the UK of £4.4 billion – equivalent to £824 for every person living in Scotland.
With such overwhelming evidence of Scotland’s native wealth, no wonder our opponents in the No campaign were so keen to spread wilful misrepresentation about the contents of a year-old document.
And it is the height of hypocrisy for any Unionist politician to question the affordability of pensions in an independent Scotland when Westminster’s proposed new state pension will see cuts to entitlement. As the Institute of Fiscal Studies has observed, “these proposals imply a cut in pension entitlements for most people in the long run”.
But let’s look closer still at what this week’s official figures say about Scotland’s economic prospects. When an international comparison of the statistics is run, Scotland emerges as the eighth wealthiest country in the Organisation for Economic Cooperation and Development (OECD), compared to the UK in 17th place. We are poised to be the eighth most prosperous nation in the developed world, and yet our opponents still peddle the fantasy that Scotland could not make a success of independence!
But while the discussion paper shows the depth of serious work being done preparing for an independent Scotland’s finances – and indeed shows a relative surplus over the UK of almost £17 billion over a seven-year period – it has, inevitably, been overtaken in several key respects over the last 12 months.
Firstly, we now have the publication of the report from the Fiscal Commission Working Group, a thoroughly detailed expert contribution from a group including two Nobel Laureates which presents a macroeconomic framework for an independent Scotland.
But we have also seen dramatic developments when it comes to the value and volume of North Sea oil. The oil price forecasts used in the paper are based on projections from the Office of Budget Responsibility which are well below the current price and also far less than is being predicted by the UK Government and international agencies.
The OBR are currently forecasting a price of $92 per barrel of oil in 2017. But other forecasts for that year see Westminster’s Department of Energy and Climate Change (DECC) predict around $130 a barrel, and the OECD is expecting $150 or more per barrel.
Crucially, at the same time as this expected surge in price, the North Sea is experiencing a renewed boom, as underlined in the recent report from industry body Oil and Gas UK which says that the additional investments which have been ploughed into the sector in the last couple of years will generate an extra £3 billion in revenues in 2017 when these new developments will be coming on-stream.
Taken together, this surge in investment and the rising price of oil mean that the early years of an independent Scotland are timed to coincide with a massive North Sea oil boom.
This coming week we will publish detailed projections showing just how valuable that boom will be.
The question every voter in Scotland must ask themselves between now and the autumn of next year is whether, given all these facts, Scotland can afford not to be independent.
Scots Remembrance Society
Annual Pilgrimage to Arbroath, Angus
As is our custom, a patriotic and social gathering of old and “new” Scots will meet at the Abbey Green, Arbroath at around 1 pm on Saturday 6th April to fondly remember Scottish patriots who have passed on over the years. The Remembrance Service will commence with a brief Address recalling the importance of Arbroath Abbey in the history of the Nation, followed by a reading of the names of those who have passed on, and who have contributed to the National Movement.
A period of two minutes silence will then be followed by the singing of the National Anthem, “Scots Wha Hae”, and thereon to a local hostelry for refreshments.
Should any of your readership wish the names of their own dear loved ones and Scottish Heroes to be read out on this hallowed ground, I shall be pleased to record their names; please call me on 07815529029.
Also should any of their bereaved families wish to attend the Service and the Social, we would be delighted to see them, as we would any other interested members of the public.
Co-ordinator, Scots Remembrance Society.
Not given credit
Just this week I saw parallels between our media and the bankers, which should have been staring me in the face ! We are funding the banks, public money , billions of it, to get them out of the mess they put themselves – and all of us – in, but they are hanging on to the cash!
Lloyds Banking Group withdrew £3bn from the FLS after its launch last summer, but has reduced the value of its loans by £5.6bn. RBS has cut £2.3bn from its overall loan book since the scheme began. Santander, which is the subsidiary of a larger group based in crisis-hit Spain, has reduced the value of loans by £6.3bn despite taking £1bn from the FLS.
With three of the big five high-street banks, which account for more than 90% of lending, cutting their capacity for lending, there is little hope of any sustained economic growth, analysts said, with George Osborne under pressure to provide further funds to boost building on homes and infrastructure projects.
The Federation of Small Businesses said the figures were a blow to cash-strapped firms, which have suffered a credit freeze for much of the last four years. According to figures last week, net lending to businesses fell by £4.5bn in the last quarter. Building societies lent more money than the banks.
So the banks do not give credit where credit is due, and companies needing cash to survive and thrive are thrown to the wolves.
Now let us consider our media. New figures, just out, show that there is a lot more oil in the North Sea than Westminster would like, sorry, I should rephrase that; Westminster would like all the oil it could get, but not for Scotland. Now it just so happened that someone, an infiltrator perhaps, leaked a confidential Cabinet briefing document a year old, showing John Swinney in cautious mood on spending and oil revenues, just as the Government Expenditure and Revenue report was published. This showed Scotland in deficit over the past year, but in much less of a deficit than the United Kingdom. The media, to a man – and woman – leapt on the “devious” SNP, saying one thing in private and another in public. I tell a lie, the Sun in an editorial said Mr Swinney was only doing what any responsible Finance Secretary would have done and should have done. As it was, the good news from GERS was swamped by glaring headlines. I found it rather ingenuous that on STV, Simon Pia, a Labour spokesman, said that the very fact that it was a secret report would have had the press jumping all over it; strange indeed that when the secret Westminster Cabinet papers released under the 30 year rule showed the skullduggery of them concealing the oil and the ownership thereof and trying to redraw the boundaries, the media just gave that a passing glance.
I was then cynically unsurprised when a BBC interviewer did not pick up earnest concerned Liberal non spokesman when he demanded to know how the oil revenue figure had changed in a week, when they were talking about figures from a year ago.
I was also offended by a Herald cartoon portraying John Swinney as a snake oil salesman; cartoons are meant to be funny, not offensive, and this one traduced the reputation of a Finance Secretary who had run the Scottish Government finances for 6 years – within budget. With perhaps a degree of prescience I had asked John Swinney just last week when the character assassination of him would begin; the Bitter lot are denigrating Alex Salmond all the time, are working assiduously to denigrate Nicola Sturgeon, so John’s time has come. The Bitter lot are attacking the individuals to try and shake the people’s confidence in them, because they are all doing their jobs well, which does not please London.
This “argument” over oil revenues reminds me of the early Seventies; when SNP researcher Donald Bain made a cautious estimate that the oil in the North Sea would generate £800 million a year, the forerunners of the Bitter lot laughed and mocked these figures, rubbished them, we didn’t know what we were talking about . To a degree they were correct, £800 million was a paltry figure – there were £billions, not millions.
The Westminster Government and its sycophantic adherents cannot conceal the amount of oil and the value thereof this time, and England needs it. The Scots were fooled before, but now we have a Parliament and a Government, and it is rather pathetic to see Bitter Together queueing up to hand the cash to London. As our bard put it “Such a parcel of rogues in a nation.”