Independence 'could spark jobs boom'

 

John Swinney says the new Scotland Act powers will not be "nearly enough"

The Scottish government has suggested that cutting corporation tax in an independent Scotland would lead to a "jobs boom".

The statement was made at an event to launch a 200-page document setting out the economic policy choices available if voters said "yes" to independence.

The SNP-run government believes Scots will be better off if they back change in next year's referendum.

However, opponents have insisted a go-alone Scotland would struggle to cope.

Former chancellor and leader of the pro-Union Better Together campaign, Alistair Darling, said that in an independent Scotland the burden of the growing elderly would "fall on a population of five million, instead of 60 million [as part of the UK]".

Start Quote

To be clear, today was not a draft manifesto for the SNP - nor even a final list of Scottish government priorities. It was a menu, a declaration of what might be possible under independence, whoever might be in power. ”

End Quote

The independence referendum takes place on 18 September 2014, with voters in Scotland being asked the yes/no question: "Should Scotland be an independent country?"

Scotland's First Minister Alex Salmond and Finance Secretary John Swinney launched the government's economics report in Dundee.

It is the last of a series of documents ahead of next week's publication of the Scottish government's White Paper on independence.

It has set out the entire range of economic powers which would be available under independence - along with the argument that sensitive, sensible use of those powers would produce policies better tailored to Scotland's needs.

Mr Salmond said: "Scotland can more than afford to be a successful independent country, with a thriving economy and opportunities for everyone. We have vast natural resources and huge human talent - but those advantages have been stifled by having our economic policy run by Westminster.

Where might the jobs come from?

  • Increasing Scotland's productivity performance by 1% could boost employment by about 21,000 over the long-term.
  • Increasing Scotland's economic activity rate of one percentage point would be equivalent to an extra 30,000 plus people in the labour market.
  • Reducing corporation tax, and changing the tax system in general, could create approximately 27,000 jobs.
  • An increase in Scottish exports by 50% could create more than 100,000 jobs in the long-term.

Source: Scottish government

"The one-size-fits-all economic policies of successive Westminster governments have failed and are continuing to fail the people of Scotland. We perform well at the moment but we should be doing so much better.

"A simple glance at many other European countries of similar size to Scotland, some without the natural advantages Scotland has, shows that we have lagged behind their growth rates for decades.

"Independence will give us the chance to build an economy that takes advantage of Scotland's unique strengths and size to deliver a more outward focussed, fairer and resilient economy, boosting revenues and creating many thousands of more jobs."

Mr Salmond said the paper set out key policy areas post-independence, including;

  • Establishing an industrial strategy which rebalances the economy and diversifies Scotland's industrial base - promoting manufacturing, innovation and boosting productivity. (The SNP believes that increasing Scotland's productivity performance by 1% has the potential to boost employment by about 21,000 over the long-term).
  • Promoting participation in the labour market by delivering more efficient employability, welfare and skills programmes and transforming child care. (The SNP says an increase in Scotland's economic activity rate of one percentage point would be equivalent to an extra 30,000 plus people in the labour market).
  • Targeting measures to reduce outflow of labour and attract skilled workers to enhance Scotland's population growth. The Scottish government says this would build on the current projections of 9% growth over the 25 year period of 2012 to 2037.
  • Using tax incentives to support growth in key sectors, such as tourism and the creative industries, and target areas such as reforming Air Passenger Duty.
  • Using targeted tax measures, such as a reduction in corporation tax, to counterbalance the pull of London and the South East of England. The Scottish government says the initiative could create approximately 27,000 jobs.
  • And boosting the internationalisation and brand recognition of the Scottish economy. The Scottish government says a 50% increase in the value of Scottish exports could boost output by about £5bn and create more than 100,000 jobs in the long-term.

The latest paper from the Scottish government comes a day after a report from the Institute for Fiscal Studies (IFS) which suggested that an independent Scotland would face big challenges ahead.

The IFS forecast assumes a decline in North Sea oil revenues and a population ageing more rapidly than in the rest of the United Kingdom.

It warned an independent Scotland would need to cut spending or increase taxes for its finances to be sustainable in the long term.

It said Scotland would face a "fiscal gap" of 1.9% of national income, compared to 0.8% for the UK.

Better Together's Mr Darling said: "Yesterday the independent and impartial Institute of Fiscal Studies reminded the people of Scotland what John Swinney has been privately telling his cabinet colleagues for months.

When, Who, What?

  • The Scottish independence referendum takes place on Thursday 18 September, 2014
  • Only voters in Scotland are eligible to take part in the poll
  • They will be asked the straight "yes/no" question: "Should Scotland be an independent country?

"If we were to leave the UK we would face the prospect of big tax rises, damaging cuts to public services - or a combination of the two.

"Today, the Nationalists have chosen to ignore reality and to offer up a type of fantasy economics that beggars belief.

"Instead of admitting the obvious challenges caused by the rise in the number of elderly people, the fall in the number of people of working age and the eventual decline in North Sea oil, the Nationalists have reverted to type.

"Their response is to deny that there are any problems and to say, yet again, that the experts are wrong."

 

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  • rate this
    0

    Comment number 70.

    Please can we have Mr Darling running the economy again. That worked really well first time.

    Alternatively, lets have Milibland running the country like he runs selection processes in Falkirk. And Balls doing his thing with the economy. I will never vote Labour again.

    #45 Its not fair but its your own fault. Contact your MP. Most in Scotland would agree with you.

  • rate this
    +72

    Comment number 69.

    There is a myth promulgated by some of the media and some contributors here that the Scots hate the English.

    Not so.

    Most of us have strong family ties with England and English friends.

    Scots do feel disenfranchised though, because government in Westminster- of any hue- follows policies that do not chime with us.

    It is Westminster, not the English, that Scots will be voting for or against.

  • rate this
    +4

    Comment number 68.

    16. Omegon
    1 Why need one?
    2 Decide what they want their taxes for
    3 New currency
    4 Get real new jobs in Scotland
    5 Royal family costs millions - not needed and the savings can be used to help others.

    Scotland actually contribute more to the UK economy than they get back.

    Next question?

  • rate this
    +12

    Comment number 67.

    Regarding the IFS report yesterday, unbelievably incompetent, they are apparently unaware of Sir Ian Woods interim report to DECC last week that recommended changes to regulation and licensing in the offshore oil and gas sector that would generate a further (at least) £200Billion revenue over the next twenty years. As they have (again) used the dicredited March 2013 OBR forecasts.

  • rate this
    -10

    Comment number 66.

    Go on Scotland, vote yes, all that money you'll supposedly make and all that money you'll save English taxpayers having to prop you up every year! A 'yes' vote is a win-win situation for everyone involved!

    Just don't expect England to bail you out once it all goes horribly wrong under President Salmond.

  • rate this
    +2

    Comment number 65.

    Both sides spout nonsense, constantly. Yet Nicola Sturgeon's recent assertions regarding MoD ship building has to be one of the more amusing examples.

    She insists that Westminster ignores Scotland only doing what is good for London, that politicians can't be trusted and are a plague on the Scottish - yet they will gift £billion defence contracts post independence.

  • rate this
    +1

    Comment number 64.

    so, Mr Green thinks the BBC are anti-Scottish does he? I would counter that they are the exact opposite. I come from Lancashire, and with the exception of Paul Mason on Newsnight there is no other NW accented voice on mainstream BBC TV channels or R4, as opposed to the abundance of (sometimes very heavily) acccented Scots accents. This despite the fact that "my" region has the sa

  • rate this
    0

    Comment number 63.

    I've long since given up listening to biased Better Together and Yes Scotland propaganda. The only research or analysis I'm interested in is unbiased, impartial commentary or statistics from reputable third-party organisations.

    So far, I've yet to hear a single cohesive argument in favour of voting Yes next year. Outwith SNP hyperbole and fantasy, it just doesn't make economic sense.

  • rate this
    +1

    Comment number 62.

    @. GSMith

    You say you are a NO voter yet you want more information.

    Does that mean you could be swayed to vote Yes with the right information?

  • rate this
    -2

    Comment number 61.

    24. “The BBC is anti-Scottish.”

    What utter tosh!!!

    Practically every other programme on radio or TV is about some aspect of Scottish life.

    If not, it is presented by a Scot.

    Every other newscaster / reporter / continuity announcer / presenter speaks with a Scottish accent.

    The BBC’s agenda to pictify / tartanise the entire UK.

    It is pro-Scottish to a racist extent.

  • rate this
    +4

    Comment number 60.

    The problem is you have the tories who are the nasty party, the LibDems who would sell their souls for a fiver and Ed Milliband who is completely unelectable, I am not surprised the SNP is an attractive option even though I don't agree with them.

  • rate this
    +17

    Comment number 59.

    These pointless independent studies just waste money. It places in a set of assumptions based on current affairs. Of course Scotlands economy would transform. It would be vital for Scotland. I think what is needed more, is what would happen on its position within the EU, What assets and debts it would inherit and the position of UK businesses (jobs) based in Scotland should they vote independence.

  • rate this
    +2

    Comment number 58.

    Is this a 'one-time' referendum, or will Salmond & Co have one every 2 years until the Scots 'get it right'??

  • rate this
    +1

    Comment number 57.

    There is one thing you can guarantee when this new "yes" report comes out and that is; 29% will support, 47% will not and 24% will be unsure.

  • rate this
    -2

    Comment number 56.

    I note that these plans don't seem to account for the massive exodus of businesses that will occur the second independance is granted due to the insane tax they'll likely encounter.

    Or for the fact that the oil industry which strongly supports this economic view will rapidly restructure itself to take advantage of the tax breaks England will grant it.

  • rate this
    0

    Comment number 55.

    I get the impression independance will be good for the new scottish MP's and their new found power and influence, i'm not so sure it will be good for the scottish population in general.

    Its seems without the 2008 banking crisis this wouldn't have been on the agenda at all but because of flawed economic policy from westminster it seems strange to decide to leave based on 5 years of problems.

  • rate this
    0

    Comment number 54.

    IMHO Independence will be a tragedy for Scotland. It does not have sufficient population to operate as an independent nation in a diverse, high technology world.

    The benefits of Aberdeen and North Sea oil will trickle away as oil reserves diminish, heavy industry and mass production has gone east.

    Tourism and Whiskey revenues will not be sufficient and their talented folks will head south.

  • rate this
    +18

    Comment number 53.

    I am English. Before we all start with the vitriol and anger. Lets not forget that last week we had rememberance for the fallen. Some of whom were valiant Scots fighting alongside others from these Isles.
    Respect where it is due. If Scotland chooses it's own path, let it bow out gracefully and remain a freind.

  • rate this
    +3

    Comment number 52.

    7.hippoellie

    We had an independent report from the IFS yesterday......
    ===============

    The IFS report was sponsored by the Department for Business, Innovation & Skills a department within the UK ConDem Government.

    Not exactly independent. Smoke and Mirrors maybe?

  • rate this
    -8

    Comment number 51.

    Oh no . . . it's the Darien Project all over again . . .

    How did Scotland ever sink so low.

 

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