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

    Comment number 110.

    Just get it over and done with, it is becoming a grandstanding event for politicians on both sides of the argument. If they stay in the UK I will be pleased, if they leave then I wish them all the best. I only hope that they get ALL the facts BEFORE the referendum, this current "we will sort out the details later" is a potential nightmare for the Scottish people.

  • rate this

    Comment number 109.

    I always wonder how those who say we are ‘better together’ would react to a proposal for the UK to become the 51st state of the USA?

    If you advocate Scotland being 8.4% of a country with 18% lower GDP/head than itself then theoretically you should be delighted for the UK to be 20% of a country with a 35% higher GDP/head. What do you think? Better Together?

  • rate this

    Comment number 108.

    SNP pushing independence, but when numbers are crunched they're desperate to ensure naval shipyards & refineries stays afloat. bye to nuke subs then.

    just like the movie braveheart, Scottish "freedom" & "self-rule": a return to medieval feudalism, with Scottish landed gentry & lords on stag hunts, keeping ordinary plebs in the farms & workhouses.

    As Scots would say, all fur coat & no knickers.

  • rate this

    Comment number 107.

    Alternative to independence Eng, Scot, Wales & NI each get one year with their local governments setting the UK wide policies. A real union of equals each taking turns. Boris want to spend 1Bn on bike lanes for London,9Bn on Olympics,80Bn on HS2,etc its all about the South East. Bedroom tax,person charged for extra room to house their kidney dialysis machine,home destroyers,heartless,good riddance

  • rate this

    Comment number 106.

    If the SNP thought they had a hope in hell of making this actually happen, they wouldn't be petitioning for children to be granted voting rights.

    Really wouldn't worry, this is never going to happen. I'm yet to met anyone I grew up with in Scotland who actually thinks this is a good idea.

  • rate this

    Comment number 105.

    @66 You don't know what you are talking about i'm afraid. Salmond wouldn't even be a president. He would be a prime minister as he said they want to remain a part of the commonwealth. If you look at the facts about Scotland's budget deficit, you will find that myth will be quashed. If it did go horribly wrong, why would England even be expected to bail em out, more over, who will bail us out?

  • rate this

    Comment number 104.

    Scotland will also never be allowed to join the EU as an independent country as Spain/France would veto it.
    It currently part of an EU net contributer (the UK). When it leaves the issue issue whether rUK can afford to be this any longer without Scottish help.

    Yes it would be allowed to join the EU. They are desperate for cash.

  • rate this

    Comment number 103.

    Its Ironic that Scots talk about how high the UK debt is yet it was caused by 2 terms of labour government in which the leaders were SCOTS (TONY BLAIR AND GORDON BROWN)"

    UK debt has been historic, you haven't got a clue about this have you, here, read this, food for thought eh!

  • rate this

    Comment number 102.

    If Scotland were to go, England (and the poor old Welsh) would have unchallenged Tory rule for generations to come, so why is Cameron and his band of Old Etonians so keen to hang on to Scotland?

    Could it be that the economic arguments of the 'Better Together' campaign are just a load of old tosh, and that England would be screwed without Scottish oil and gas?

    Vote yes and ruin Cameron's day.

  • rate this

    Comment number 101.

    This is your one chance for independence Scotland. Make sure you grasp it.

  • rate this

    Comment number 100.

    Scotland and the Scottish have played a huge part of putting the Great in Great Britain"

    Yes, almost by definition as it was James I of England (VI of Scotland) who coined the term "Great Britain" and invented the original union flag.

  • rate this

    Comment number 99.

    @69 scunnered
    So who do the Scots cheer for when England play France at Rugby?

  • rate this

    Comment number 98.

    You can not have a 'one size fit all' macro economic policy when the economic make up of Soctland is so different to the rest of the UK. UK is skewed towards banking; Scotland's to tourism, whiskey, IT, Oil & Gas, renewables etc. Scotland is a net exporter, UK is a net importer.Not saying either system is intrinsically better - simply that one policy can not beneift two such diferent economies.

  • rate this

    Comment number 97.

    The ignorance displayed in some of these comments is remarkable! Omegon (16) for example - no, you don't need a royal family to become a sovereign state - there are countless republics around the world with their sovereignty intact. Also, Scotland does pay for a military at present - through taxes! Likewise, Scotland could continue to pay for free prescriptions as Scotland spends less than raised!

  • rate this

    Comment number 96.

    Good luck to the Scots if they believe what their ministers say

  • rate this

    Comment number 95.

    It's trivially obvious that we'll be presented with optimistic / pessimistic arguments for / against Scottish independence. I personally think it's excellent that Scots are being invited to re-affirm their desire for a Union. I know what I'd do if I owned more than 10m of once British (before carpet baggers sold everything on it) coastline and a small, south-facing patch of land.

  • rate this

    Comment number 94.

    Assuming the SNP are right and that Scots are wealthier and therefore better off financially if they vote for independence, surely that means that the rest of Britain are worse off financially by this?

    That's selfish. I want these rich Scots to stay as part of the UK that helped make them so rich.

    I think I'll buy a second home in Scotland and vote against it.

  • rate this

    Comment number 93.

    G4S to pay back £23.3m. Tip of the Iceberg. Would Scotland be better without Tory Boys mates ripping them off.

  • rate this

    Comment number 92.

    the racism of the little englanders on this forum is shocking as is the racism towards england, however that is not surprising considering some of the bile being vented here.

    the vote on independence has nothing to do with any of that. it is about our opportunity to have self determination, for better or worse.

    i will be voting yes.

  • rate this

    Comment number 91.

    The 19th century, roughly :)


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