SNP’s £5billion independence claim based on complete guess work
28 May 2014
Alex Salmond’s forecast that an independent Scotland could be £5billion better off within 15 years is based on complete guess work.
The Scottish Government today put out a paper claiming extra billions could be generated by 2029-30 under independence based on three key assumptions:
- Scotland’s working population would have to increase productivity
- Almost 80,000 new jobs would need to be created
- Immigration would have to increase by up to 24,000 a year
The claims also fail to take into account the prospect of major firms moving jobs out of Scotland under independence, reduced oil revenues and the fact the country’s population is ageing quicker than the rest of the UK.
Today’s Scottish Government paper also failed to put a figure on the set-up costs of creating a new state.
Finance Secretary John Swinney was asked eleven times on BBC Radio Scotland this morning on what this figure would be, but was unable to give an answer.
Scottish Conservative Chief Whip John Lamont MSP said:
“This is just another sleight of hand from the Scottish Government in its desperate attempt to shore up the case for independence.
“Their £5billion figure is based on a number of key assumptions which are complete guess work.
“Alex Salmond’s has simply looked into his crystal ball 15 years into the future and plucked this figure out of thin air.
“He has rushed out this paper with a big headline figure hoping to mask the fact they have no idea what the set up costs would be for creating a new state.
“With just over 100 days until the referendum vote, it is quite astonishing they have no idea of the costs involved in setting up all the new departments and bodies a new nation would need to operate.
“The fact their White Paper contains just a single page of sums to back up the SNP’s case for independence says it all about their attitude to showing how they would pay for independence.”
The current employment rate in Scotland is 73.5%, meaning 2.585million people in Scotland are now in work.
A rise of 3.3% would mean 77,550 more jobs by 2029-30.
Good Morning Scotland 28/05/14 – Costs of a New State
John Swinney interviewed by Gary Robertson
Asked 11 times what the set up costs for a new state would be
1: GR: What are the start-up costs for an independent Scotland?
JS: Well what we’ve got to consider in establishing an independent Scotland is the fact that we have a great deal of the infrastructure of an independent country as we stand just now. We administer a very substantial proportion of the public services within Scotland and we obviously have in Scotland for example through the tax and welfare system significant elements of the infrastructure for the delivery of a tax and benefits system.
2: GR: What would the cost be?
JS: And we also have to bear in mind, the proportion of the £1.3 trillion worth of assets to which an independent. Scotland would have access as a consequence of the negotiation with the rest of the UK to establish an independent country.
3: GR: Figure is?
JS: So what we would do is we would work to establish an approach to the design and delivery of the services of an independent country based on the use of the assets and resources which we have under our control just now and the assets to which we are entitled to a share within the UK.
4: GR: And that would reach a total figure of?
JS: Well if I give you an example of some of the work we are doing just now on Revenue Scotland where we are setting up a new organisation to collect a range of taxes devolved to Scotland. We are doing that for 25% lower than the cost we already pay to HMRC to undertake that work. I think what that demonstrates is that in an independent Scotland we would be able to build on the infrastructure we have just now and to undertake that set up work in a much more efficient way.
5: GR: And the final bill for the set up would be what?
JS: Well that would clearly be worked out as a consequence playing all of the issues I have set out for you just now.
6: GR: You have accused the Treasury of getting figures wrong, of misleading people- tell us what the figures are then
JS: The point on the Treasury misleading people is made very clearly not just by the Scottish Government but by Prof. Patrick Dunleavy of LSE who was making it quite clear last night that the Treasury has badly misrepresented the research of the LSE.
7: GR: Well Danny Alexander is saying it is not Prof Dunleavy’s research which forms the basis of the report. Give us the figures
JS: I’m sorry Gary that is just not the case. The Treasury were citing Prof. Dunleavy’s research in the material they set out to journalists in Scotland and it is in a Treasury press release I have in front of me. The UK government has been caught fiddling the books as they have tried to undermine confidence in Scotland about the steps we can take towards independence.
8: GR: Cannot say that they are misleading figures if you cannot put a figure on it yourself
JS: What I have set out to you is the various factors that we bring together to enable us to establish an independent country. The services we already provide, we have much of the infrastructure of the tax and benefits system here in Scotland.
GR: ICAS says changes to the tax system could cost considerably more than £700 million. Is £1.5 billion figure that Danny Alexander cited earlier wrong?
JS: I think it is wrong. There are a whole number of different elements of our existing infrastructure in Scotland that we can utilise to build upon to establish the organisation of an independent Scotland.
9: GR: How can we be three months from the referendum when you cannot tell us what the figure would be?
JS: There is crucially the access that Scotland has to the asset base of the UK to which we are entitled to have a share.
GR: Do you dispute the figures from ICAS?
JS: I think there is a whole series of steps we can take to ensure we deliver efficient government in Scotland.
GR: Is their £750m figure too high?
JS: I think that is far too high a figure to be talking about.
10: GR: What would the real figure be?
JS: If you look at the regulatory bodies that you have raised just now I think there is a whole collection of regulatory bodies that are organised as separate and distinctive regulatory bodies within the UK and we have said quite clearly we want to integrate those to operate those on a more efficient basis across the whole of independent Scotland and as a consequence save the public purse a significant amount of money.
11: GR: Let me try one more time. Surely you could then put a figure on it?
JS: Well that figure depends on how we build out a range of the different bodies that we already have within Scotland and how we utilise the share of the asset base to which are entitled within the UK.