This post is quite long so I apologise if its of no interest. I was reading an article posted by a friend (thanks Philip Dela Cruz-Joyce) about how Scotland overpays for the UK debt, here it is if you want a read, scotsman/news/scotland-overpays-for-uk-debt-1-3185848 . It is aimed at the Yes camp of which I am a proud member but I thought Id maybe have a look over the fence as it were and see what the no camp had to say. Scottish Independence Fiscal black-hole warning, reads the headline, the article is here, scotsman/news/politics/top-stories/scottish-independence-fiscal-black-hole-warning-1-3192186 . Strong words, there were a few quotes from the co-author that screamed scaremongering at me so I wrote my own little notes if youd care to take a read. Co-author Gemma Tetlow, a programme director at the (London based) IFS, said: “An independent Scotland would face even tougher choices than those faced by the UK over the longer term (Of course, well be setting up a whole new country!). In 2011–12, higher public spending per person in Scotland was more than matched by higher revenues from activity in the North Sea (Well that sounds pretty good). “However, over the long term, revenues from the North Sea will probably (so its basically guesswork) decline (but they wont if we stay in the UK?) and official (government who want a no vote) population projections (again, guesswork, albeit from modern statistics) suggest the average age of the Scottish population will increase more rapidly than for the UK as a whole (are we all going to age faster? Or are less babies going to be born because Im pretty sure that if a yes vote goes through Scotland will see its own baby boom 9 months after, to the day!), putting greater upward pressure on many areas of public spending (surely this is happening all over the UK as it is). “As a result, to ensure long-run fiscal sustainability, an independent Scotland would need to cut public spending and/or increase other tax revenues more than would be required across the UK as a whole. (More than is already on the cards from the incompetent UK government? Id rather take the sting from tax hikes, not imposed but discussed and reasoned, from a Scottish government set up in favour of the people.)” The scale of the challenge over the next 50 years would depend on factors (unknowns) such as how much debt Scotland inherited from the UK (its fair share), interest paid on the debt (logic would follow lower amount of debt = lower interest = lower payments?), the age of the population and potential changes in oil revenues (oh) and immigration rates. (Which are all going to affect the UK whatever happens.) An independent Scotland could expect to start life about £90bn in the red (I would like to know how this is worked out) as it would inherit its historic share of UK national debt. Scotland already has an annual deficit – where spending outstrips the revenues raised through taxes – of about £7bn. (Wouldnt our smaller debt repayments, lowering the deficit, and the greater share of the oil revenues, raising the revenues, balance this out, if not cover it?) Upon typing up my thoughts Ive realised that if you remove the comparisons to the UK, my own thoughts, and replace an Independent Scotland with the UK the third last paragraph is basically what the UK government is pushing on us anyway. Thanks for your time.
Posted on: Fri, 22 Nov 2013 00:03:56 +0000
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