Economics of Independence

Conservatives voters should now support independence

Written by Michael Gray
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Michael Fry of Wealthy Nation is a Conservative for independence

Today the Scottish Conservative Party has published its report on further devolution. While going further than the lukewarm Labour version, it remains unambitious. Of the top seven sources of income, the report proposes fully devolving just one. This hardly provides the ‘responsibility’ some claim it does.

This proposal would give Scotland control of just 28.3% of taxation. National insurance, North Sea revenues, corporation tax, fuel duties, alcohol and tobacco duties would all remain at Westminster. The revenue from Value Added Tax may be allocated to Scotland, yet control would remain at Westminster. Even the tax free threshold on Income Tax would remain at Westminster. (see chart below)

This does, however, recognise a direction of travel across UK politics. Every single unionist party (excepting UKIP) is trying to convince the people of Scotland that they believe in Scotland taking more control over its affairs. However the only way to guarantee more powers is by voting for independence.

Many Conservative supporters are voting for independence. The group Wealthy Nationled by Scottish historian Michael Fry and containing former Conservative MSP Nick Johnstone – is an example. They see the sense in giving financial responsibility where there is spending responsibility.

tory tax proposal

Independent powers for a stronger economy

They recognise that an independent Scotland is an opportunity to build on Scotland’s economic strengths and develop new businesses. With responsibility closer to Scotland’s communities, Scotland can prosper. As an equal, independent country Scotland can target international opportunities.

Some leading members of the Conservative Party – such as Murdo Fraser – even advocated an independent Conservative Party from London and a journey towards financial independence or ‘fiscal federalism’.

Conservatives for independence

For those voters a Yes vote in September is now the best option. Even if the limited Conservative package was ever adopted, it would represent a 1% rise in Scotland’s tax powers per year. That’s a snail’s pace. It would take a full 100 years for Scotland to control its own income.

Historian Michael Fry has written at length on why independence is a better option. He wrote “we think Scottish independencre is a logical extension of our belief in personal, political, social and economic freedom”.

Former Conservative MSP Nick Johnstone said, “Having followed the arguments of the Yes and No campaigns, my conclusion is that while a devolved parliament can do good things – and it has – it lacks the core economic and welfare powers to tackle the fundamental issues.”

Conservative donor and businessperson Laurie Clark spoke to Prime Minister David Cameron on his support for independence: “For me, a Yes vote represents the end of an unfair union but the beginning of a fairer and mutualy beneficial partnership between Scotland and the rest of the UK.”

Peter de Vink was a Conservative and is now an independent councillor in Midlothian. He writes that “the concept of independence entails more self-responsibility, individual freedom, competition and local democracy – the very ideals underpinning my political persuasion.”

Conclusion

Rather than wait for Westminster to slowly and imperfectly reform itself through a ‘trickle down’ of powers, a Yes vote guarantees that Scotland will gain economic powers to improve Scotland’s economy. Scotland will gain 100% of tax powers for the 2016 Scottish election. That’s a reform worth voting for.

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About the author

Michael Gray

Michael is Head of Research with Business for Scotland.

A graduate from the University of Glasgow, he has carried out a series of interviews with academics, politicians and the public in Denmark, Iceland and Ireland. Michael's on twitter @GrayInGlasgow.

6 Comments

  • The whole thing need rethought

    Do away with cash, no more backhanders everything into a bank a/c

    Give everybody a job cutting the grass with a pair of scissors and see how quick the jobs that they previously didn’t want become better.

    Drugs are available why not tax them instead of creating a black economy worth billions and paying no tax the VAT alone would do more good deeds than the extra costs.

    That be a start

  • I do not think any more devolution can resolve Scotland’s basic and /or main revenue issues which will be oil and whisky. These revenues are part of what makes Scotland today. To have more devolution without our main earners puts us much more enthralled to Westminster. When there is a shortfall in income tax revenues to pay for pensions as is predicted by the babyboom generation retiring the Scottish parliament would have to go cap in hand to Westminster but may still being paying in more than it gets back.

  • Agree entirely it is no good tinkering about with income tax rates. The UK’s political structures are unfit for purpose, a more radical approach needs to be taken. You don’t need to be a Unionist to be a Scottish Conservative so lets go for it.

  • On hearing in the news this morning (2nd June) that the Conservatives now seem to be committing to some form of Devo-Max following a No vote in September, and that Labour and the LibDems are roughly aligned on this approach too, my concern is this might persuade the “undecideds” to vote No in the hope that the parties live up to their promises! But will they?!.

    For me the trouble with devo-max – particularly with the income tax raising powers – is that it only provides for part of the solution (and a small part at that , see main article above), thus keeping the major levers within the control of Westminster. What’s the use of only having control over income tax and being unable to decide on the other key tax raising powers and indeed more vitally on all the areas of expenditure, e.g. Trident, etc?!

    What Alan Bissett said in this clip:

    http://www.youtube.com/watch?v=_scVW5BE29U

    and elsewhere is scarily now coming to pass! What really upsets me is that Cameron et al pointedly refused to add the Devo-Max option to the referendum ballot, and yet now are “offering” this as an enticement to vote No! That is one of the most underhand things I’ve come across to date – it stinks of bad politics (why am I not surprised by this), and this needs to be exposed for what it is and hammered home by the Yes campaign teams over the next few weeks!

    • Andy dont make the mistake or referring to the latest offer of more “powers” as Devo-max. It doesn’t even come close. All it does is give us is more of what Holyrood has always had but has never used. Extra tax raising powers and the extra administration costs that go with it, but the inability to control spending, leaves Scotland worse off. It leaves us with the choice of raising income tax or cutting public spending to fund these new “powers”, to have the unrealistic and questionable prospect of two separate taxations within one nation, (is this possible?), or lose everything that we’ve gained through devolution like free prescriptions, free tuition, etc etc…
      We’d effectively be forced to implement all the austerity cuts that we’ve managed to get round so far. The NHS in Scotland would be forced down the same privatisation route as our southern neighbours and all the failings entailed with it, just watch the news for that.
      These arent more powers, its more control by Westminster through the backdoor.
      Voting No will be an absolute disaster for Scotland.

      • I completely agree with you Stewart! Problem is that the press are publicising this as “Devo max” and I think many people will be hoodwinked into believing this to be the case and the comfort it provides in perhaps considering voting No on the 18th Sept. That’s why I believe the Yes campaign must vociferously de-bunk this as you’ve outlined so eloquently.

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