UPDATE 23/08/2017 – This article was published in 2016 and refers to the GERS report of that year but the questions are all still relevant in any conversation.
THE mainstream press are falling over themselves to point out the size of the financial deficit that Scotland has as part of the United Kingdom. From this, unionists conclude that Scotland cannot afford to be an independent nation and that it shows how much we need the UK to subsidise us. Putting aside that remarkable lack of respect and ambition for Scotland there is, however, a question the press are not asking.
It’s a small question, one that’s not difficult to understand, in fact I would say it should be the first thing out of the mouth of any self respecting journalist looking at GERS and having just received a quote from a sycophantic Westminster politician about black holes. They should simply ask “how come”? They could even use the shorter version “Why”? Why, when Scotland is a country with an embarrassment of economic advantages that any small to medium-sized independent country would give their left arm for, do we have a financial deficit greater than any other independent European nation of similar size? Why, if we really are Better Together and the basis of our economy is so strong are we not doing better than those we would benchmark against?
Why, when being run from Westminster is supposed to be such an advantage, does GERS (the Government Expenditure and Revenue Scotland) report clearly demonstrate that it isn’t. Look at benchmark nations, ones with a similar-sized population to Scotland that coexist in the same Western European geographic, economic and political environment, but are independent. According to GERS all Scotland’s benchmark independent EU members (and Norway) are financially better off than Scotland – how come?
Those nations would love to have Scotland’s oil and use it for the good of their own citizens, Norway is far more reliant on oil than Scotland, but it has been saving up for a rainy day and can increase investment to stimulate growth and save jobs by investing from its oil fund when the best the UK government did for Aberdeen was a city deal that involved less cash per head than Manchester, a city that by comparison is booming. Sure the UK Government gave big tax breaks to the big corporates that run the oil industry but the jobs still melted away, as always they help the big corporates and not the people.
Denmark would love to have a national drink that generated £120 of exports per second, that generates massive tax takes in the locations it is sold throughout the UK. Scotch whisky companies would gladly sell you a bottle of whisky for £4, the rest you pay is the UK tax.
Sitting in Edinburgh the city is alive with the Edinburgh Festival and Fringe, the world’s largest arts festival attracting 500,000 visitors and adding £261m to Scotland’s economy. Belgium would love to have such a tourist attraction, never mind the beauty of wild Scotland or golf tourism.
Ireland would kill to have Scotland’s online gaming industry which has grown over 600 per cent – GTA the world’s best-selling game is made in Scotland and industry experts claim the gaming sector could grow to be worth more to Scottish economy than oil ever was.
Sweden would like to match Scotland educationally, (according to the Office of National Statistics) the adult population of Scotland is the most educated in the whole of Europe. Forty-five per cent of people in Scotland aged between 25 and 64 have experienced tertiary education – including university degrees and further education. Luxembourg, Finland and Ireland (all benchmark independent nations) vie for second place as the only other countries to get more than 40 per cent.
Finland must be massively envious that Scotland possesses 25 per cent of the EU’s entire tidal and wave energy potential, a source of energy that doesn’t pollute, won’t run out and, given Aberdeen energy sector leadership, we are better placed than anyone else to create a world centre for renewable energy, but no – Westminster prefers nuclear.
We got lucky with oil and now again with renewables lets not make the same mistake and see either the sector under-invested in or milked by Westminster. As part of the UK billions that should have been invested in Scotland and the North East were siphoned away when we should have been investing in, diversifying and strengthening our economy instead of paying off UK debt – Westminster and the unionist media never said thanks for all those years when Scotland bailed the UK out with our surpluses, but now we have two years where our figures are worse than the UK’s apparently we are the basket case.
The simple fact is GERS figures tell us nothing about how Scotland would have fared as an independent country under the same circumstances, as we would have implemented bespoke economic policies, had different tax rates and with either a sovereign oil fund or massive capital investment – we would have a radically different fiscal starting place.
It does tell us that our core onshore economy is strong, growing £1.9bn in tough conditions. But to see how Scotland would fare as an independent nation look at every benchmark country and ask how, when added together they can hardly match Scotland’s economic advantages, do they somehow manage to have smaller financial deficits than Scotland.
The difference is they get to make decisions for themselves, the people who choose economic strategies and investment policies are those closest to the problems and opportunities of the country and with their country’s best interest at heart.
Just for fun ask a Swede or a Norwegian, a Belgian or Dane if they think they would be better with a distant, dysfunctional, disinterested government from a larger nation that neither cares about nor understands their nation and its economy, making all their decisions for them.
No one would ever join such a union.
When you run the UK with a strategy for generations that rips the wealth, youth, talent, power and opportunity out of the regions and draws into the London and South East bubble then regions of that nation will eventually run a deficit.
The regions subsidise London’s failing economic strategy with its very life blood and then unionists say Scotland is the one that is subsidised.
I have written before about how an independent Scotland could save billions in shared services we don’t need, that are added to our deficit by Westminster. Such as £1.2bn a year an independent Scotland could save on defence by going conventional and not taking part in illegal wars.
If however you want to see Scotland’s deficit get worse then all we have to do is stay with the UK when it eventually invokes Article 50. Then the UK’s economy will start to crumble like a Labour PFI project – which incidentally accounted for £1bn of Scotland’s deficit in the recent GERS.