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By G.A.Ponsonby
Finance Secretary John Swinney has warned that staying in the Union would cost Scotland over £50 billion as a result the UK’s massive debt problem.
Mr Swinney warned that Scotland currently faces seven years of cuts imposed by Westminster and that it could take 18 years before public spending returned to pre-recession levels.
Addressing delegates at the SNP conference at the SECC in Glasgow, the SNP’s Finance Minister said:
“Under the current constitutional settlement the UK’s austerity programme means Scotland’s public spending faces a further seven years of cuts.
“As part of the UK it could take 18 years before public spending returns to pre-recession levels and spending in Scotland could fall by £51 billion in the meantime.”
Mr Swinney highlighted the UK’s growing debt burden which he said was in danger of reaching over one trillion (£1000,000,000,000) pounds.
“In ten days time we will find out if the UK’s long term debt has smashed the trillion pound barrier. A trillion pounds that we are all liable for.
“Debt that every citizen in Scotland will have to repay – independent or not. That’s the real story of the finances of the United Kingdom.”
In his speech Mr Swinney also pointed to the latest official figures that showed Scotland again in surplus relative to the UK.
The GERS report, published this week, showed that Scotland would have been better off to the tune of £2.3 billion had it been independent last year. This, said Mr Swinney, increased to £8.6 billion over the last five years – equivalent to £1600 for every man, woman and child in Scotland.
“Scotland contributed 9.6 per cent of UK taxes, but we received only 9.3 per cent of UK spending in return. With only 8.4% of the UK population we paid more than our share and got less back.
“Two years ago in 2009-10 Scotland paid in 9.4% of UK taxes, but again only 9.3% came back. Even when North Sea revenues fell by 50% Scotland paid in more money to the UK Treasury than came back.” he said.
In a speech that stressed Scotland’s healthier state when compared to the rest of the UK, Mr Swinney repeated the argument put forward by the First Minister on Saturday that Scotland could do even better with full control over resources and the full fiscal levers that independence would bring.
Mr Swinney attacked Westminster for the failure to regulate the banking system properly, and for what he termed the profligacy of investment schemes like PFI.
Responding to claims that the referendum timetable was creating uncertainty and was harming business investment Mr Swinney cited companies who had already committed major investment in Scotland – Amazon, Michelin, Dell, and Avaloq.
Mr Swinney added:
“We have seen major global players in renewables and manufacturing like Mitsubishi and Samsung make real commitments to Scotland that will deliver jobs and opportunities.
“This week Dunfermline based company Burcote Wind announced plans for a billion pounds worth of renewable energy investment and the transformation of the Nigg Yard in the Highlands to a renewable energy hub is beginning.
“According to leading accountants Ernst and Young, in a report now spread widely through Channel 4’s fact check blog, international inward investment is now more successful in Scotland than any other parts of these islands, including London.”
Mr Swinney pointed out that the UK Government itself had acknowledged the strength of Scotland’s Green energy credentials by siting the Green Investment Bank in Edinburgh.
The Finance Secretary also quoted the Financial Times, which had described uncertainty claims as “disingenuous”.
“The Financial Times described Westminster’s pretext for accelerating the poll – that uncertainty is damaging the economy – as ‘disingenuous at best’. They said that as threats go, any risks posed by a referendum were ‘as a fleabite’ compared with the all-devouring Eurozone crisis.” he said, and added:
“If there is any uncertainty facing Scotland’s economy, it comes not from the talk of a positive future with investment in the economy but from the policies of austerity and negativity being pursued by the UK Government.”
Mr Swinney warned that the challenges of the global recession would not disappear with independence, and stressed the importance of educating Scots on the economic strength of their country in the run up to the independence referendum.
Citing a report from the Centre for Economics and Business Research he said:
“And it’s not just me that says that Scotland is strong enough to stand on our own two feet. Contrary to what we sometimes hear, a recent study by the independent Centre for Economics and Business Research confirmed that Scotland receives no net subsidy from the rest of the UK.
And they worked that out whilst allocating Scotland less than our full share of North Sea Oil and Gas.”
Mr Swinney then took a light hearted swipe at the SNP’s political opponents who he suggested had conceded Scotland was more than capable of making a success of independence.
“David Cameron – ‘It would be wrong to suggest that Scotland could not be another such successful, independent country.’
“Ruth Davidson – ‘I believe Scotland is big enough, rich enough and good enough to be an independent country.’
“Scottish Labour deputy-leader Anas Sarwar – ‘Scotland would probably be a successful country if it was an independent country.’
“Iain Gray – ‘I do not think Scotland is too small, too poor or too stupid to stand on its own’
“David McLetchie – ‘An independent Scotland would be viable’
“And who could forget Michael Moore ‘You’ll never hear me suggest that Scotland could not go its own way.’
Mr Swinney ended the list with a quote from Michael Saunders, Chief Economist at Citigroup who said “you have to get over any misconception that Scotland cannot be a viable economy because it clearly can be.”
The Finance Secretary argued that the fiscal case in favour of independence was already clear and called on Unionist parties to address what he called the consequences of staying in the Union.
“Conference there can no longer be any argument about whether Scotland can afford to be independent.
“The answer is yes and the case is closed. The question our opponents have to answer is can we afford the consequences of remaining part of the UK.”
what do we get for the exorbitant sums of money ploughed into our defence budget, which is their not only for necessary defence purposes but to continue to play the part of a world power.
A surprising number of English commenters on the BBC and elsewhere seem to think we can be scared off by pointing out that, after independence, we’d just be another ‘small, unimportant country’.
They don’t seem to realise that that’s just fine. After independence, Scotland will be the most important country in Scotland, rather than an unimportant part of a United Kingdom which has dug itself a huge financial hole by trying to be a player on the world stage.
After independence, Britons who still think they should rule the waves can do so from the deck of their new aircraft carrier, where there will be plenty of room.
Well spake Dundonian West. They are a good bunch, aren’t they.
I’ve just had a call from the other half and he’s, as I type, leaving the SSEC and he’s absolutely delighted with the last couple of days. Inspiring is just one of the adjectives he used. I’m sure he’ll be on this site tonight/tomorrow talking about it.
“They are a good bunch, aren’t they”.
Makes me proud,the outstanding government we have here in Scotland,for EVERYONE in Scotland.
Everyone.
Tis must have been John Swinney’s speech to the conference today. Whatever happened to the BBC coverage? Nothing I could see on telly today.
It’s an absolute disgrace that the coverage this conference received was only noticable by one thing… It’s absence! I have gone online and registered my complaint to the BBC, and i have asked for a reply. Can i suggest that anyone else who feels strongly about the lack of coverage for what was simply an inspirational, positive, FULL TO THE BRIM venue packed house of hope, does the same thing?! It might serve them a bit of notice if several thousand complaints arrive in their inbox.
Serious question does anyone have the answer?
Speaking recently to a friend from London I quoted the GERS report which demonstrated that Scotland has been in surplus for several years. As a businessman he replied that these figures are just like revenue and expenditure for a branch of a large company ie. UK and that the UK being the central office as it were has other expenditure which is not taken into account for Scotland. In other words in an Independant Scotland there would be many more overheads which are not considered in the GERS report.
Can anyone out there shed some light on this as I have had others questioning Scotlands finances and don’t have answers?
Many thanks.
It is not a branch account as it also includes “attributable” expenditure. This is, funnily enough, for the most part not actually spent in Scotland and is a way for London to hide how much it actually consumes of the entire UK budget. So, Scotland gets charged for expenditure such as civil service costs, including London weightings, for “UK” civil servants who don’t actually have anything to do with Scotland, for “national infrastructure projects such as London Crossrail, that don’t actually benefit anyone in Scotland, and for “national” events such as the London Olympics, where again hardly one penny piece gets spent in Scotland.
There are numerous other examples – foreign office, where we get charged for “our share” of a diplomatic service that does not serve us, but we then get charged again if we actually want to use facilities that we are already paying for (e.g. Scotch Whisky trade missions using embassy/consulate premises). Defence is another one – we get charged “our share” of defence costs, but again what is actually spent here is a fraction of what we are charged.
Other items – BBC license fee, again a fraction of what is raised is returned here, DVLA money, court fines, Crown Estates revenue, climate change levies it goes on and on…
These figures together amount to billions, not millions, of pounds sterling. Relieved of this burden, this “Union dividend”, Scotland will be a much wealthier place, with greater choice on how we address the needs of our own country and people and not the greed of London and the South East.
How does this compare to recent Labour and Lib Dem conferences and exposure by the BBC?
A rhetorical question Hirta unless I am mistaken.