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Independent Scotland would be financially viable



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Dr Martin J Knott (Letters, 12 May) repeats the same old tired fear of Scotland's ability to sustain itself financially if it were to become independent. It was widely reported during the fuel crisis that North Sea oil brings in £50 million a day. Even if Scotland received only half of this, we would be more than economically viable: we would be wealthy.
This is not news to successive British governments that, according to papers released under the 30-year rule, have been suppressing this information and issuing "dissembling" propaganda about the sums involved. And one must ask whether this huge sum of money is one of the reasons Westminster is so much against Scottish independence and does not allow close inspection of the reasons for maintaining the Barnett formula. Who subsidises whom?

Even many economists who were cautious about Scotland's economy under independence have reluctantly had to concede that Scotland would be perfectly financially viable, even prosperous. Those, like Dr Knott, who continue to blind themselves to the economic truth of the matter are the political equivalent of people who still believe the earth is flat.

LOVINA S ROE

Glasgow Road

Perth





The full article contains 199 words and appears in The Scotsman newspaper.
Page 1 of 1

  • Last Updated: 13 May 2008 8:08 PM
  • Source: The Scotsman
  • Location: Edinburgh
 
1

Isonomia,

Lenzie 14/05/2008 01:53:38
Just to put Lovina right, there never was a time when people thought the world was flat. That is a very recent myth apparently stemming from an 18th or 19th century novel describing the fear of Columbus' sailors about falling off the edge of the world.

If anyone bothered to talk to any sea-farer it is very obvious the world is rounded because boats drop down as the go over the horizon.

For more info see wikipedia "flat earth myth".

As for Scotland being financial viable .... I doubt it, but then again, I doubt that England is at present financially viable with the £1,000,000,000,000 of personal debt used by Labour for that old con trick of public borrowing to temporarily boost the economy .... except this time they conned the stupi public into doing the borrowing against the value of houses whose price has been artificially hightened by increased demand through immigration and government stranglehold on new house build.
2

Sierra Foothills Scot,

Diamond Springs 14/05/2008 02:48:00
#1 Ms Roe is right. The UK government has known for more than 30 years that Scotland does support itself financially.

For example, Professor Gavin McCrone, Fellow of the Royal Society of Edinburgh, advised the UK government in 1975 of the truth about Scotland’s finances. As Chief Economic Adviser to the Secretary of State for Scotland, he prepared a report, “The Economics of Nationalism Re-examined”. His report advised the UK government that an independent Scotland would have a massive budget surplus. It was promptly classified "Secret" and suppressed. It came to light only in 2005, when the UK government was forced by law to release it.

The UK government’s Government Expenditure and Revenue in Scotland (GERS) report provides another example of the UK government’s duplicity. This was finally exposed by forensic accountant Niall Aslen's analysis of the 2005 GERS report. The analysis (available at http://www.alba.org.uk/scotching/greatdeception.html) was based entirely on the UK government’s own figures, with one exception for which UK government figures were not available. Mr Aslen documented the sources of all the figures.

Mr Aslen's analysis exposed the UK government’s egregious misallocation – to Scotland’s serious disadvantage – of revenues (not just oil revenues) and costs. If a private firm cooked its books half as outrageously as the UK government has done in its GERS reports, its directors would be in jail.

Mr Aslen's analysis convincingly demolished the assertions that Scotland was being subsidised by the rest of the UK. But the British press ignored or suppressed it. Luckily, enough people saw it on the internet before the 2007 election to discredit Labour’s claims that Scotland was running a £11.2-billion deficit. Mr Aslen’s analysis showed that Scotland actually had a £9.6-billion surplus.

The Scottish Government will publish a GERS report covering 2006 and 2007 in June 2008. It is expected to be very different from the 2005 report publi
3

Sierra Foothills Scot,

Diamond Springs 14/05/2008 02:48:23
The Scottish Government will publish a GERS report covering 2006 and 2007 in June 2008. It is expected to be very different from the 2005 report publi
4

Sierra Foothills Scot,

Diamond Springs 14/05/2008 02:49:26
Let's try again:
The Scottish Government will publish a GERS report covering 2006 and 2007 in June 2008. It is expected to be very different from the 2005 report published by the former Labour executive.
5

Rulesbutnotrulers,

Federation, not separation 14/05/2008 08:33:37
Ms Roe is wrong!

This is oil supporting Scotland, not Scotland supporting itself. Remove the oil (only 20 years?) and then what will happen? Please England, we made a mistake? Can we have another Union?
6

Linda,

Edinburgh 14/05/2008 08:39:29
# 5

If we had control of Oil Revenues the Scottish Government would copy Norwegian model and invest money in Futures Bonds to build up funds for future generations.

Also while North Sea Oil may run out there are plenty of reserves in Atlantic / Rockall basin which if prices remain high will soon become viable to extract.
7

Normal!,

Highland 14/05/2008 08:56:07
#5 Spot on! Reliance on "Scottish" oil is living in fantasy land. What would Scotland do when it runs out? The only solution maybe would be to find a market for the hot air the Nats are ever giving out!
8

Dave from Barra ©,

Western Isles 14/05/2008 08:57:28
Linda

Exactly! Rules, what would England be without that £50 million a day pouring into Westminster coffers?

You think they have a massive empire and are wealthy to "carry" Scotland, Wales and NI?

C'mon. Why do you think they are desperate to hang onto us? Because they know the oil will last a lot longer than 20 years, that's why.

Linda is right, even with a limited supply, we could put aisde for a riany dau so to speak. If we ran out of oil, why would we go cap in hand to England when they will be bankrupt way before we are.
9

StuartAD,

West Lothian 14/05/2008 09:14:27
The Norwegian way was started at the onset of oil flow & cannot be replacated in the UK as oil will run out in the near future. We had our chance, but Maggie chose to go down the path of buying the biggest missile system at that time. We are left with that & all that entails. Being powerful was the drug she needed.
We will have to open many more Museums & such like to keep ourselves afloat after that, never mind we can always sit & complain about the English & how we were robbed.
10

Mr. Lachie Todd,

Edinburgh 14/05/2008 09:14:31
It is only natural that Unionists everywhere wish to maintain the integrity of the United Kingdom, and are prepared to go to any lengths to misinform the Scottish Electorate.

However, even without a pro rata share of the U.K.'s hydrocarbon deposits, Scotland would have a viable economy which would continue to attract large tranches of inward investment and grow year by year. (Source: The Economist)

It is a well-worn argument but many recently independent nations like the Baltic States, Republic of Ireland, and Norway now have higher GDP and GNP rates than France, Germany, Italy, Spain and the UK!

Many former members of the Communist block like Hungary and Poland, who 5 years ago were struggling with their economies, are now developing quickly. Many in the industrial Czech Repulic claimed that agricultral Slovakia could never survive without but the Slovaks have gradually proved otherwise. West Germany paid a high economic price for Reunification but 18 years later the wealth is finally filtering through to the former GDR.

The argument about an independent Scotland is no longer economic, it is political.
11

FamilyMan,

Edinburgh 14/05/2008 09:31:14
Scotland's oil? Oil only exists as an asset when a field has been discovered, developed and claimed (by extending sovereignity considerably into the previously open seas). Then there is the scientific and infrastructure underpinning of the whole petro-chemical enterprise. Finally, the whole lot has to be defended and policed. All this under the present union arrangements. I wonder how a divorce lawyer would approach this: who would have possession, what would be the access rights, what size alimonies and to whom and for how long? Maybe a bit more marriage counselling would be more productive.
12

Upbeat,

14/05/2008 09:37:07
The "wealth " of any country lies only in the skills of its people.

Take mineral and other riches away from any country and what are you left with ?

So long as the people of Scotland are 'duped' into imagining that all they have to do is get the rest of the United Kingdom ' off their backs' so that the oil revenues will pay for everything in Scotland, the longer this myth of super richness and propsepctive idleness will persist.

To look around the world . Switzerland has arguably the highest standard of living in Europe. Does Switzerland have oil ? does Switzerland have vast deposits of minerals and huge agricultural capacity. ? No of course it does not. What it does have is a well educated and highly skilled workforce who have the capability to enhance the value of every raw material they acquire. This is true richness. North Sea oil is transient, the reserves are finite. This dream of untold wealth for Scots from this source alone is no foundation for a successful economy.
13

Upbeat,

14/05/2008 09:38:06
sorry: Prospective is a better word !
14

Miss H,

14/05/2008 10:08:25
The viability of Scotland as an independent country does not depend on oil. It depends on the Scottish people. As with every other country. People who have no faith in Scotland's ability to flourish and prosper as an independent country have no faith in the ability of the Scots people to manage their own affairs successfully despite the fact that countless other countries do. They basically do not think we are up to it.

The point about oil however is that it does illustrate the reality of how the Union works. Here we have a valuable and diminishing resource. We could have invested a share of the revenues in an oil fund as other oil-producing nations have done so that the benefits will be felt long after the oil itself has run out. Instead we just hand the money over to Westminster to do with as it will and Westminster hands us back our pocket money and tells us we are lucky to get that. It's pretty pathetic when you think about it, isn't it?
15

Hamish Scott,

14/05/2008 10:16:21
With or without oil Scotland is financially viable, more than the vast majority of currently independent countries. We have large reserves of coal and existing hydro-electric power. Being a windy semi-island we have vast potential renewable energy both wind and marine. We have a large fisheries potential. We have a good ratio of population size to the size of the country. We have a highly succesful whisky industry that is unique to Scotland with large amount of foreign earnings. We have a large tourist industry that is also 'unique' in that there is only one Scotland. We have a good education system and infrastructure, though both could be considerably better. We have all this even before we consider our economy more generally. It would require sustained and comprehensive incompetence for us NOT to prosper at least as well as we are now.
16

Hamish Scott,

14/05/2008 10:20:11
#11
"Scotland's poil?" Yes, Scotland's oil. The work, infrastructure and investment you write of has been made by multinational oil companies. The UK's wealth from oil comes from licensing and taxing the extraction of it. The same would apply to an independent Scotland.
17

Denis,

14/05/2008 10:29:41
#8 Dave from Barra - you take your argument too far.

"... what would England be without that £50 million a day pouring into Westminster coffers?"

Total UK tax revenues are about £500 billion pa, of which less than 3% - currently about £12 billion pa - derives from North Sea oil. Taking GDP trend growth rate as 2.5% pa, the rest of the UK would quickly recover from the loss of the oil revenues. On the other hand, they would be about 25% of Scotland's tax revenues.
18

bill-alba,

Fife 14/05/2008 11:15:20
The fact that we have oil is just the icing on the cake of what will be a very strong country. as for only 20 years oil reserves left (rulers) you will have to do better than that with your unionist myths..
19

Dave from Barra ©,

Western Isles 14/05/2008 11:36:08
Denis

My maths isn't good. £50 million per day X 365 =?
20

Denis,

14/05/2008 15:05:32
£50 million a day x 365 = £18.3 billion a year. But that's the market value of the oil, not the tax revenues.

http://news.scotsman.com:80/latestnews/The-cost-of-keeping-the.4047998.jp

"For 48 hours, no oil flowed into the BP pipeline that feeds Scotland's only oil refinery and there wasn't a drop of the £50 million that flows into the economy daily as a result."

"In the March Budget, the treasury forecast the oil industry would pay £9.9 billion into government coffers in the coming tax year, but this was estimated from a position of much lower oil prices. Oil & Gas UK says current forecasts put the income to the treasury at £2.5 billion more than this."

Total GDP of the UK economy in 2007 was £1385 billion, so as a fraction of that North Sea oil would be about 1.3% at current prices. But just for Scotland the fraction of GDP would be about ten times higher.
21

TerryH,

England 18/05/2008 18:30:16
I infer from this debate that Scotland will go their own way when someone proves, beyond doubt, that England is not subsidising Scotland. Whist the situation is uncertain you will hang around the Union, just in case.

This is a really lousy reason to be united with anyone! Especially if you're English!
22

Craigellachie,

AVIEMORE 09/06/2008 19:37:29
If, after 300 years of union with England, Scotland is not viable, then one must conclude, that the union, has been a failure, and should therefore, be ended as soon as possible.

 

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