Scottish independence: Rivals both say Scots 'better off with us'

 

The UK and Scottish governments are debating whether Scots would be better off under independence

Competing claims about the costs and benefits of Scottish independence have been set out to voters.

The Scottish government said everyone in Scotland would be £1,000 better off a year, in the event of a "Yes" vote in September's independence referendum.

But UK ministers said in their analysis people would benefit from staying in the UK by £1,400 per person, per year.

Each side of the debate also sought to discredit the figures put forward by their opponents.

Scottish First Minister Alex Salmond said the Treasury's calculations had been "blown to smithereens", while Chief Secretary to the Treasury Danny Alexander accused SNP ministers of offering voters a "bogus bonus".

Independence: Treasury view

Each person in Scotland

£1,400

a year better off in UK

  • 13% more tax needed to maintain independent Scotland public services, or...

  • 11% cut in public services needed to keep current tax levels

  • £1.5bn-£2.7bn estimated cost of restructuring Scotland's institutions

Getty Images

A new Scottish government paper said an independent Scotland would begin life with its public finances in a "strong" position, and could see its economy £5bn per year better off by 2029-30.

Mr Salmond said Scotland was one of the world's wealthiest countries, but needed the powers of independence to realise its full potential.

He told the BBC: "We put forward the benefit over a period of 15 years. We calculate that as each individual in Scotland being £1,000 better off - that's a £5bn bonus, or a family £2,000 better off a year."

The Scottish government paper said:

  • Scotland's finances in 2016-17 will be similar to, or stronger than, both the UK and the G7 industrialised countries as a whole.
  • Scotland's public finances show debt on a downward trajectory, enabling future Scottish governments to start an oil savings fund.
  • Scotland's estimated debt to GDP ratio in 2016-17 is forecast to be lower than the UK's under any potential outcome of negotiation with the UK over public sector assets and liabilities.
  • Scotland's fiscal position between 2008-09 and 2012-13 is estimated to have been worth £8.3bn, equivalent to £1,600 per person.
  • An independent Scotland could see tax income increase by £2,4bn a year by 2029-30, under a predicted 0.3% productivity increase.
  • A 3.3% increase in Scotland's employment rate would move it up to the level of the top five performing countries in the OECD and could increase revenues by £1.3bn a year, by 2029-30.

Independence: Scottish government view

Each person in Scotland

£1,000

a year better off out of UK

  • Onshore tax receipts will be up £5bn by 2030

  • 14% increase in oil and gas production between 2013-18

  • Tax receipts currently 14% higher in Scotland than UK

Getty Images

The first minister said his government's calculations were "based on reason and logic", as he hit out at UK government claims it could cost up to £2.7bn for an independent Scotland to set up the public bodies it needed, which made use of London School of Economics research.

LSE academic Patrick Dunleavy later posted on his Twitter account: "UK Treasury press release on Scotland costs of government badly misrepresents LSE research."

Mr Salmond added: "Danny Alexander's calculations have been blown to smithereens, because the Treasury relied on the work of the LSE professor, Professor Dunleavy, who this morning has accused them of grossly misrepresenting his work."

But Mr Alexander branded the Scottish government's £5bn figure a "bogus bonus", adding: "They're desperately trying to distract attention from that fundamental question, that there simply wouldn't be the same level of resources available for public services if Scotland were independent."

The Treasury published its own paper outlining what the UK government sees as challenges to an independent Scotland, including an ageing population, declining oil revenues and the potential for higher interest rates.

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Scotland in numbers
Scotland's population and age breakdown: Scotland accounted for 8.3% of the UK population (5.3 million) in 2012
  • What is Scotland's population?
  • What is Scotland's share of the national debt?
  • How does pay in Scotland compare with England, Wales and NI?
  • Key stats: Scotland in numbers
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Mr Alexander said: "Today we have shown that, by staying together, Scotland's future will be safer, with stronger finances and a more progressive society.

"Because as a United Kingdom we can pool resources and share risks. It means a UK dividend of £1,400 a year for every man, woman and child in Scotland.

"That dividend is our share of a more prosperous future. It is the money that will pay for better public services and a fairer society."

The Treasury analysis said:

  • Scotland, as part of the UK, was projected to be able to have lower tax or higher spending than under independence. This "UK Dividend" is estimated to be worth £1,400 per person in Scotland in each year from 2016-17 onwards.
  • Under independence, the loss of the UK Dividend would mean £1,400 per year for each Scottish person in higher taxes and lower public spending.
  • The "direct costs" of independence would include higher interest rates for an independent Scottish state to borrow, the net costs of setting up new institutions, and the net costs of funding the Scottish government's White Paper policies (including the potential economic benefits).
  • If the UK debt was split according to population at the end of 2015-16, an independent Scotland would take on debt of about 74% of its GDP, which could reach "unsustainable levels without policy action".
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Treasury graph
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Scottish tax receipts
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ANALYSIS - BBC Scotland political editor Brian Taylor

What is the £1,400 Union dividend?

Well, the UK Treasury says it's per person and would come into play at the onset of independence. It takes into account higher public spending borne by Scotland alone; lower oil revenues than Scottish government forecasts; a disproportionately ageing population; set-up costs of independence and the net effect of policies in the White Paper, such as a reduction in corporation tax. To counter that, Scotland would benefit from having a geographical share of North Sea oil, rather than having it shared across the UK as a whole.

So, what is the breakdown per head? The first six figures show costs to be added to Scotland's account (hence the plus). The seventh, about oil share, is a cost to be removed from Scotland's account (hence the negative).

  1. Lower UK borrowing +£47
  2. Set-up costs and net effects of Work and Pensions policies avoided +£261
  3. Costs of ageing absorbed across UK +£163
  4. Long term oil decline absorbed across UK +£130
  5. Lower Scottish onshore tax revenues absorbed +£207
  6. Higher public spending in Scotland +£981
  7. Oil revenues shared across UK, rather than geographically -£389

Total added costs: £1,789

Total gain: £389

Net downside: £1,400

And that, according to the UK Treasury, is how you get to the Union Dividend - worse off by £1,400 under independence, or taken the other way, £1,400 better off sticking with the Union.

Read more analysis from Brian Taylor on the two competing economic visions

 

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  • Comment number 1009.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    -3

    Comment number 1008.

    The main argument/grevance for independance is that the Scots do not feel represented adequatly at Westminster 52 MP's out of 400 (12% representation). If they join the EU they will have 7 MEP's in 776 about 1% rep. If it happens then the UK will also be weekened and a federal Europe will be one step closer for us all. Do not change the UK change the politics in Westminster. Scotland please stay

  • rate this
    +2

    Comment number 1007.

    the money spent over the last 15 years alone in london and the south east from the Chunnel ,millennium celebrations, Terminal 5, Olympics, Opera houses and Cutty Sark farce and Boris is demanding more, better together i doubt that Danny, better start looking for a new job none of you lot will be welcome in a new Scotland and its politics

  • rate this
    0

    Comment number 1006.

    Salmond wants Scottish independence for his own legacy the numbers don't stack up. I can't believe anybody in Scotland wants this

  • rate this
    +3

    Comment number 1005.

    As an Englishman Living in Scotland for the past 15 years this is a debate close to my heart. I am British and always will be but the Scottish see themselves as Scottish not British the vote is for if they WANT independence not if they can afford it!. alot of them do!, a fact overlooked by the "london south" I hope its a No vote but if it isnt then so be it!.

 

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    Right now the city council provides day-care services for the Chinese, Indian and mainly Pakistani communities, including faith-related services for Sikhs, Hindus and Muslims.

     
  70.  
    09:22: Frosty the glow man Steven McKenzie BBC Scotland Highlands and Islands reporter

    Snow covers a pedestrian crossing in Inverness this morning, but illuminated symbols of a bike and person glow through.

    Illuminated symbols of a bike and person glow through a covering of snow on a pedestrian crossing in Inverness
     
  71.  
    09:18: Sarwar resigns

    Former Glasgow Govan MP Mohammad Sarwar has resigned as governor of Punjab in Pakistan.

    Mohammad Sarwar

    News of his departure came in a tweet in which he said it had been an honour to serve the people of Pakistan.

     
  72.  
    09:14: Still snowy in Selkirk BBC Reporter Richard Gordon

    The sky here is blue but there has been a fair fall of snow, especially in the western parts of the borders - they've been worst hit overnight.

    There are no reports of road closures. Driving conditions on minor routes are challenging because gritting crews are of course focusing on main roads at the moment.

    The situation is expected to improve as the day goes on. We might get one or two more snow showers but we're not expecting many.

    School buses not running in the Hawick, Peebles, Selkirk , Jedburgh and Newcastleton areas.

     
  73.  
    09:10: Perthshire: A85 BBC Scotland Travel Latest

    #Crieff #A85 partially blocked RTC Crieff to Comrie.

     
  74.  
    09:08: South Ayrshire

    Three school closures so far in South Ayrshire.

    Details on the council website.

     
  75.  
    09:06: South-west Scotland Giancarlo Rinaldi South Scotland reporter, BBC Scotland news website

    More than 50 schools have been shut across Dumfries and Galloway as snows affected the region.

    It is mainly primaries and secondaries in the east of the region which have been affected.

     
  76.  
    Anyone for tennis?
    Tennis

    Ruth Davidson has tweeted about her excitement over Andy Murray: Hmmm..... FMQ prep Vs tennis..... #comeonandy

    Nicola Sturgeon was quick to take up the suggestion: @RuthDavidsonMSP I'm sure we could come to some arrangement - @kdugdalemsp?

    Suddenly consensus begins breaking out: .@NicolaSturgeon ok, I'll bring the snacks - let's use your office. @kdugdalemsp Kez, you in?

    And Kezia Dugdale agrees, it's time for tennis: @RuthDavidsonMSP @NicolaSturgeon yes, there in a minute, looking for the Pimms

     
  77.  
    09:00: A75 hazardous BBC Scotland Travel Latest

    #A75 partially blocked hazardous driving conditions, snow between B725 (Carrutherstown) and B721 (Newbie). A number of lorries are stuck

     
  78.  
    08:57: Scene in Dumfries BBC Reporter Bruce MacKenzie

    There is actually a lot of widespread disruption now. A lot of untreated back roads in the west of the region that are hazardous this morning.

    A lot of people telling me that they are getting to where they need to go, it's just taking them a lot longer.

    That seems to be the overall picture at the moment.

    We have had quite a bit more snow since just after 06:00 this morning - probably here in Dumfries another inch or so of snow.

    Quite a lot of snow lying on power lines. No reports of any power problems in the region at the moment, but that one that we will be definitely keeping an eye on.

     
  79.  
    08:55: Scene in Inverness BBC Reporter Kevin MacKenzie

    A little more snow has fallen since 06:00 this morning but police in Inverness are describing the roads across the north as generally "passable with care" - they have been no incidents reported so far.

    There's certainly quite a bit of snow on the route but roads all look pretty clear.

    While some schools are being closed across the Highland area, some of the bigger schools such as Charleston Academy in Inverness and Nairn Academy will open a little later due to weather affecting school transport.

    In Moray there seems to be no snow problems.

     
  80.  
    @trafficscotland Traffic Scotland

    #A75 btwn Annan and Carrutherstown - @ScotTranserv has treated E/B and now working on the W/B. HGV's still stuck in the area. #BeAware

     
  81.  
    08:49: Your pictures - snow in Scotland via Facebook

    Yolanda Preston posts: Believe it or not there's my car under there!

    Picture from facebook

    That's a lot of snow! Be careful in kilsyth as roads really slippy and not cleared and M80 moving slow! There's nothing in Stirling compared to Glasgow! Took me an hour to get to work this morning! ‪#‎traumatic‬

     
  82.  
    @nlcpeople North Lanarkshire

    Transport: no buses to Calderhead HS, McGregors bus to Glencryan School cancelled.

     
  83.  
    @argyllandbute Argyll and Bute

    Thursday schools update: Skipness primary school is closed today

     
  84.  
    08:42: 180 gritters deployed

    Speaking on Good Morning Scotland Transport Minister Derek McKay said: "There've been a few incidents overnight but they've been cleared and the traffic systems have still been working well.

    "Even at the moment, during typical peak hour traffic the road network is still flowing fairly well.

    "There is one issue at the M8 plantation eastbound but its still passable with care, and I think we've prepared very well for the weather and the snow.

    "With 180+ gritters out, we've worked very hard to prepare the roads for these conditions."

     
  85.  
    08:39: Ten mile tailback BBC Scotland Travel Latest

    Earlier accident #GW #M8 eastbound at plantation causing a ten mile tailback to erskine bridge.

     
  86.  
    08:36: Highland Council Steven McKenzie BBC Scotland Highlands and Islands reporter

    29 schools and nurseries shut in the Highlands. The closures involve 4,795 pupils.

     
  87.  
    08:34: Today's papers

    The decision by the Scottish government to announce a moratorium on fracking dominates front pages in The Scotsman and The National.

    Scotland's newspapers frontpages

    Elsewhere, the Scottish Daily Mail leads with the story of councils using anti-terror laws "to spy on dog walkers, tanning salons and shops selling fireworks".

    An axe killer walking the streets four years after being detained without limit of time is the lead story in the Daily Record. The Herald claims fee-paying students at the University of the West of Scotland are to be offered their money back if they fail to graduate.

    Read the full paper review here.

     
  88.  
    Call 0500 92 95 00 or text 80295 08:28: Morning Call BBC Radio Scotland

    After an advertising expert criticised over-reliance on traditional Scottish imagery such as kilts and bagpipes to encourage tourism, we ask:

    Are bagpipes and Nessie the best way to promote Scotland?

    And following a collapse in sales of Scottish potatoes last year, the Press and Journal are urging shoppers to buy as much Scottish and British produce as possible.

    Would you change your shopping habits to help Scottish farmers?

     
  89.  
    @nlcpeople North Lanarkshire

    B-Line buses to following schools cancelled: Braidhurst, Our Lady & St Francis, St Serf's PS, Keir Hardie PS

     
  90.  
    @ScotRail ScotRail

    NEW: We've got a broken down train between #Drumgelloch & Airdrie. Services through these stations may be delayed. More info soon.

     
  91.  
    @SouthLanCouncil South Lanarkshire

    Closure update (8.10am) - Coulter Primary School and Walston Primary School (no water in the area)

     
  92.  
    08:13: Public 'back police guns policy'

    Just over half of respondents have backed the routine arming of firearms officers in a study commissioned by a police body.

    Armed police

    The survey of 1,000 people by the Scottish Police Authority suggested 53% were supportive of the policy.

    Almost one in three said it increased their confidence in the police.

    In October last year, following growing criticism from politicians and civic society, Police Scotland decided to back down on the controversial policy

     
  93.  
    @scotborders Scottish Borders Council

    School buses run by Telfords in Hawick area cancelled - H05, H08, H10, H13, H19 #sbctravel

     
  94.  
    @AnasSarwar 08:10: Anas Sarwar

    I can confirm that Sarwar snr. has resigned as Governor of Punjab. An honest man, doing the honest thing. More details soon...

     
  95.  
    @trafficscotland Traffic Scotland

    #A90 E/B at Walnut Grove (near Friarton Bridge) - RTC blocking lane 1 & 2, traffic not moving and police are en-route #BeAware

     
  96.  
    #ScotlandLive 08:05: Snowy snaps on twitter

    Who has today's best snow pictures?

    The BBC's Laura Bicker(@BBCLBicker) was hard at work creating a snow angel late last night.

    Laura Bicker making a snow angel

    While BBC reader Mr D. Lamont(Demo_D3005) has also been making the most of the snowy weather, saying "Perfect #snow in #Kinross for #SnowCars".

    Snowy car on twitter

    Tweet us your pictures to @BBCScotlandNews.

     
  97.  
    @trafficscotland Traffic Scotland

    A90 M90 J11 Barnhill - St Madoes - Accident, 2 lanes closed Northbound for up to 45 minutes

     
  98.  
    @SPEnergyNetwork SP Energy Networks

    We are aware of a #POWERCUT in #KA26 #Girvan. Our engineers are working to restore supplies. Sorry for the inconvenience.

     
  99.  
    @SouthLanCouncil South Lanarkshire

    Braehead and Carmichael primary schools have just announced they are closed today

     
  100.  
    07:57: Dumfries and Galloway

    Council says 22 schools now closed in Dumfries and Galloway.

    Details on the council website.

     

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