GERS Report Shows Scotland subsidises UK, says Professor Andrew Hughes Hallett

 The following interview was conducted during my tenure as Chief Editor of the former title Newsnet Scotland. I intend to resume publishing with the title Scottish Times in due course.

EXCLUSIVE:

Professor Andrew Hughes Hallett is a world class economist who divides his time between George Mason University in Virginia and St Andrews.

From 2001 to 2006, he was Professor of Economics at Vanderbilt University (Nashville) and before then at the University of Strathclyde in Scotland. He has been Visiting Professor in Economics at Princeton University, Bundesbank Professor at the Free University of Berlin, and has held visiting positions at the Universities of Warwick, Frankfurt, Rome, Paris X, Cardiff and at the Copenhagen Business School.

PROFESSOR HUGHES HALLET, COULD YOU SUM UP YOUR IMPRESSION OF WHAT THE NEW GERS REPORT TELLS US ABOUT THE SCOTTISH ECONOMY DURING THE DEEPEST PART OF THE GLOBAL RECESSION IN 2009-10?

The things that stand out are that it has been a rough couple of years, but Scotland had weathered the storm better than the UK as a whole. She has a budget deficit for the first time in half a dozen years but it is a smaller deficit than the UK. So the implicit subsidy to the rest of the UK (RUK) is still there.

What’s more, this has been happening in a period when oil prices were low. This is of course a backwards looking exercise (up to April 2010). Those low prices were reversed a year ago, so the implicit subsidy will have increased markedly since then.

Note: all my remarks take the revenues/spending actually raised in Scotland, as opposed to those allocated to Scotland by the accounts (which are often quite different). You will appreciate the significance of that difference.

IN WHAT WAY IS SCOTLAND SUBSIDISING THE REST OF THE UK?
Public spending has fallen as a percentage of UK total each year since 07-08, so Scotland is being squeezed more than RUK. That seems unfair, and it goes back to when Gordon Brown took over as PM.

However the share of Scottish public spending in the UK total has risen
when oil revenues are included, so RUK is relying more and more on Scotland’s share of oil revenues for its spending.

The deficit on the current budget is 6.8 per cent of GDP, whereas for the UK as a whole it is 7.6 per cent. Again you see the implicit subsidy to RUK - equivalent to about one per cent of our GDP being sent south (adjusting to get RUK figures, rather than all UK figures).

Adding in capital spending, the figures become 10.6 per cent (Scotland) versus 11.1 per cent (all UK). Same story.

Note capital spending in Scotland is rising fast (unlike RUK) as it should be to power the way out of a recession. Correctly: any recession is too good to waste!

WHAT ABOUT THE VOLATILITY OF OIL INCOME?
Non-oil GDP is down 3.0 per cent, but with oil it fell 7.5 per cent. As I said, oil was a damaging factor in this period, but will have improved now. Hence Scotland is actually doing better than it appears from these figures.

However, UK GDP is down only 1.8 per cent. So Scotland's performance has been weaker than UK, presumably because she is subsidising the latter and because she has been allowed to run a smaller "counter cyclical" deficit.

IS THERE ANYTHING IN GERS THAT THROWS LIGHT ON THE SNP GOVERNMENT’S DEMAND FOR MORE TAX POWERS?
Income tax revenues are down 2.8 per cent overall, implying a significant deflation bias under the current Scotland Bill proposals - as many had argued when the Bill came to the Scottish Parliament last year.

But more significantly many of the other tax revenues are now rising as a share of total revenues: I note here national insurance contributions, fuel, and particularly excise taxes (tobacco, alcohol, vehicles).

So income taxes are a poor source of revenue to rely on. Think what you could have done with a wider spread of tax revenues to power the spending to get out of recession and to use as levers to grow the economy.

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Scotland better off leaving bankrupt Britain

Published during my tenure as Chief Editor of the former title Newsnet Scotland. I intend to publish under the title Scottish Times in due course.

Despite a huge drop in North Sea oil prices in the year 2009-2010 an independent Scotland would have been better off economically being outside the UK according to newly released Government figures.

Commenting on the new GERS (Government Expenditure and Revenue Scotland) figures released today one of Scotland's leading investment bankers Ben Thomson, chairman of the Campaign for Fiscal Responsibility, said: "The latest GERS figures show that Scotland’s budget position in 2009/10 was better than for the UK as a whole.

"As a percentage of GDP, both Scotland’s net fiscal balance (-10.6% compared to the UK’s -11.1%) compare favourably with the UK as a whole." (See chart)

"This is despite the drop in Scotland’s geographic share of North Sea revenues for 2009/10 from £11.7 billion to £5.9 billion which has resulted in a deterioration in Scotland’s budget position.

Debt to GDP ratio based on GERS

"It is also worth pointing out that this will also have improved considerably since 2009/10, the year covered by GERS.

"The Office for Budget Responsibility (OBR), in its 2011 Budget Report, estimated that North Sea revenues would average £13.4 billion over the next five years of which Scotland’s geographic share would be £12.2 billion.

"This is more than double the revenue levels in 2009/10 and would bring Scotland’s net fiscal position close to balance."

Compared to current UK debt

Against a backdrop of out-of-control UK debt it is clear that Scottish families, institutions and businesses would benefit significantly from independence. This year UK public sector net borrowing for April and May totals £27.4bn which is £1.5bn more than the same period in 2010 according to the official ONS (Office of National Statistics) report. 
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UK consumer confidence

According to YouGov's Household Economic Activity Tracker (HEAT) UK consumers remain extremely negative (-26 points) about the next 12 months ahead. This compares woefully to China which has a positive (+42 points) rating making the difference in consumer outlook between the two economies a 68 point gap.

Newsnet Scotland Comment
With oil revenues much higher in the last year it is clear that being released from its share of UK fiscal debt an independent Scotland would be in the position to increase the standard of living of all Scottish citizens.

Yes, as Unionist commentators like to point out an independent Scotland would have carried debt in this single year but as can be seen it would be less debt than it must carry as part of the UK.

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Cost of the Union to every Scot - £2, 413 each year

Published during my tenure as Chief Editor of Newsnet Scotland. I will resume publishing under the title Scottish Times in due course:

Scots must pay £12.546 billion every year just to stay in the Union according to Office of National Statistics (ONS) information. UK public sector net borrowing (excluding financial interventions) was £139.4 billion in the year 2010/11 and so Scotland's share based on 9% population amounts to £12.546 billion.

This is at least the annual cost for Scots of remaining within the Union as Scotland's national accounts show a surplus meaning none of the debt is accrued in Scotland.

According to world-renowned economic expert Professor Andrew Hughes Hallet Scotland's economy, unlike the UK economy is in robust shape:

“Scotland’s accounts, rather than those compiled in London, show that Scotland has a small net surplus, rather than being a net beneficiary from the UK."

The bad news for Scots is that the UK treasury is accruing debt which is accelerating owing to bad house-keeping south of the border and dragging the Scottish economy down with it.

Think Tank statement

An analysis from the right-wing think tank - the Institute of Economic Affairs (IEA) - shows Scotland's share of the UK's skyrocketing public debt will be a staggering total of £110 billion by the time it is likely to become independent.

This sum is startling and, to make matters worse, is set against official UK Government figures which forecast unprecedented levels of UK debt which will surge past £1.1 trillion this year.

Perhaps not surprisingly these figures will be used by pro-independence supporters to show that Scotland must get out of the sinking UK ship as quickly as possible.

There's no cause for alarm though as Scotland will have the ability to escape this problem if it votes 'Yes' in the forthcoming independence referendum. The real problem facing the budgets of Scots families, institutions and businesses is that the SNP Government may wait too long to call the independence referendum while each year Scots have to pay £12.5 billion and rising - merely to be ruled from London.

Based on the official figures it costs every single Scot £2, 413 per year to pay off a debt they didn't cause. This debt could be avoided if Scots vote 'Yes' in the referendum and so would be an 'independence dividend'.

With full independence Scotland will control its oil and gas reserves and so have no problem picking up this 'Union tab' but how much longer will Scots tolerate austerity and benefit cuts designed for a plummeting UK economy?

Scotland's share of UK debt is unlikely to be as bad as the analysis by the IEA's Richard Wellings suggests as it bases its figures on Westminster public spending figures which are exaggerated. For example the entire cost of maintaining Trident is classed as a Scottish expense rather than a UK one. Wellings' analysis though does say that there is a preferable method of estimating Scotland's share of debt:

"Better still would be an estimate that also took account of the share of UK tax revenues generated in Scotland, but such a calculation is complicated by significant fluctuations in North Sea receipts from year to year."

As we know Scotland is in surplus and that is calculated based on our population share of North Sea oil and gas reserves. An independent Scotland would be entitled to far more of those resources than its population share and so it reasonable to assume that Scotland's share of the debt will be estimated downwards during independence negotiations with London.

Certainly, whatever Scotland has to absorb from the UK's debt mountain will be manageable - once Scotland is independent - as when oil and gas revenues are added to a Scottish exchequer our debt to GDP ratio will be far less than England's.

At the moment exports from Scotland's huge financial services sector are credited to London which means Scotland's current GDP is hugely underestimated. Post-independence this picture will become clearer and Scotland will look in much better shape to face the future.


News Scotland

Reasons Scots will vote 'Yes' to independence - Shoogly pegs

A piece I published during my tenure as Chief Editor of the former title Newsnet Scotland. I will resume publishing under the title Scottish Times in due course.

Analysis by Alex Porter

Scottish Unionism has seen better days and there are any number of angles on its current crises. So, as the great referendum debate starts to take shape can the usual arguments for Union hold?

Shoogly peg 1: The media is the massage

One worth consideration is that control over the traditional media no longer equates to control over the political loyalties of Scots. Unionist politicians can gang up on a Nat in a tv debate and believe their collective reasoning to be indestructable but the Nats still win elections. That must rankle in certain quarters.

Every year around 1.5% of the population becomes eligible to vote. These people are young and clued-in with all things world wide web. Every year 1.5% of the population - with few internet skills - leaves Scotland to the rest of us. Taken together these figures mean every year 3% of the voting population becomes instantly internet savvied and so the influence of traditional media dwindles. Of course, the rest of us in the middle are not sitting still so are also becoming more internet savvy. At every passing election the Katie Grants of this world talk exclusively to her own rapidly-dwindling kind.

One very real danger for Unionism posed by the internet is that voters have so many varied sources of information. The consequence is that their 'bollotix' alarm sounds at the merest hint of a dodgy narrative on TV news reports. People are not easily led or misled anymore. It was thanks to the internet that the SNP overcame the hositility of Scotland's Unionist media to win their historic first term in 2007. Four years later social networking and other internet channels played no small part in delivering the SNP a majority of Scotland's 129 seats in Holyrood.

It stands to reason then that the internet will play a key role in who wins Scotland's independence referendum. More Scots now get news from the internet than any other source such as the BBC and that trend is consolidated year after year in proportion to the passing of traditional Unionism and its print media allies. Unionism depended heavily on influencing traditional media and so even if there is any substantial remaining attachment to the Union, Unionists must surely realise that it can no longer get its own way because it can massage the message.

The contrived narrative about Scots having no desire to exercise their democratic right to an independence referendum is now consigned to the midden of history where it always belonged. However, said midden will have to wait a wee while longer before giving refuge to 'received wisdoms' of Scotland's pro-Union mainstream media on the subject of the benefits of independence. Will Unionism be able to bamboozle our internet savvy Scots voters into sticking with the "Union dividend" in the midst of austerity cuts? Somewhat, but Scottish nostrils will detect a reek and so an opportunity presents itself to the SNP.

Political beliefs are no longer simply drip-fed to the Scots electorate by fusty establishment figures like Jim Wallace (Lord Wallace of Tankerness) with a penchant for ermine but are arrived at using peer-to-peer recommendations via social networking channels. Scots, especially young Scots, have developed a healthy distrust of traditional media's political commentary and reportage. Information passed on from a friend, on the other hand, has value. Having young bright things such as Kirk Torrance, the party's New Media Director, to advise the SNP who have grasped this new paradigm shift leaving Scottish Unionism a decade behind the curve.

Shoogly peg 2: Independence a distraction

Watching the Unionist-leaning media having a post-mortem about what has gone wrong was the icing on the cake for Nationalist activists. Most Scots couldn't give two hoots what happened to Unionism. The Unionist political establishment, or what remains of it, is shocked and the old Jedi mind-tricks that once held sway in TV political commentary are now exposed, deliciously for independentistas, as blindingly obvious scare-tactics in real-time.

The well-worn classic is the one about how debating the constitution is a distraction from dealing with the economy. If that's the case then how can Unionists such as former chancellor Alasdair Darling also argue that an independence referendum should be held quickly so as to minimise uncertainty for business? If independence is not relevant to the economy then what could business be uncertain about? People are not daft and if you treat them as if they are they'll eventually change the channel.

For their part the Nationalists could argue that the delay in transferring tax-raising powers to Holyrood is causing uncertainty for Scottish business. Many Scottish boardrooms feel threatened by London's current advantages and so the business landscape is now very favourable to fiscal autonomy - Unionism would be foolish to lose whatever business constituency is still retains and some, such as the decimated Lib Dems, are beginning to realise that only by proposing substantially more powers will the Scotland Bill become palatable to the Scots electorate.

Today's Scots, and especially internet-savvy Scots, know full-well that independence is about politics and economics and therefore jobs and services - to suggest otherwise is treating the electorate contemptuously and the recent election showed that Scots have had their fill of specious, negative soundbites.

To his credit David Cameron, in reaction to the SNP's landslide, did promise he would make a positive case for the Union during the referendum campaign. It is not clear who in Scotland will bother to listen to the English Etonian Prime Minister, least of all Scottish pro-Union supporters. Scottish Unionists, on the whole, have defined their Unionism entirely by what they are against and so when pushed - and they haven't been pushed much until now - can't express why they support the Union except in vague terms of economic benefits.

Instead, we are bombarded with the economic downside of independence but this is never convincingly substantiated by official statistics which could prove or disprove their case. Those figures have been long concealed from public view arousing yet more scepticism of the case against independence.

Shoogly peg 3: Umbrellausterity

Which brings us to the next shoogly peg of Unionism. Scotland needs the umbrella of Union to protect it from the uncertainties of the international economy. What planet are these commentators on? The reality of living in UK PLC is perfectly and simply understood by all Scots who know what the word 'austerity' means.

Austerity cuts are imposed on Scotland by Westminster which is running an unprecendented and ballooning deficit. UK government debt stood at £903.4 billion at the end of March and heading due North. At the same time Scotland's economy under the stewardship of John Swinney is in surplus. So, despite Scotland's economic surplus the Scottish parliament has to lose out to pay for poor house-keeping South of the border. Some umbrella.

The umbrella metaphor goes from the ridiculous to the sublime when reflecting on the plummeting value of the pound. A depreciating sterling means foreign goods and components become more expensive. Scottish importers must then pass their increased costs on to Scottish consumers. What is becoming clearer, month by month, is that an increasing number of economists and analysts accept that there is no reason to believe that austerity measures and historic low interest rates will do anything but make the UK economy worse.

Britain is being left behind by its key trading partners according to Scottish economist Brian Ashcroft. Germany is a manufacturing power-house and so can balance its books by exporting goods it makes. Manufacturing only accounts for 12.8% of the UK's economy. That is a dire state of affairs and means there's no easy way of paying off spiralling govenment debt. Closing the gap in manufacturing would require more than a generation of capital investment. Capital is formed by companies saving money but with interest rates held at 0.5% there is no incentive for them to save.

There-in lies the UK's catch 22 - raising interest rates is not an option for Westminster as its debt now approaches £1 trillion and the UK's consumer debts are higher than the rest of the EU combined. If the people are already struggling and you land them with higher interest payments how will they be able to also pay for the government's increased interest payments through taxation? Some umbrella.

To continue borrowing the UK government must borrow against future North Sea oil revenues. If it can't then confidence in the UK economy will nose-dive and capital will flee. The fly in the ointment is the referendum on Scottish independence which is now certain after the SNP's landslide victory. Much of the commentary from the English print media suggests that the English would be glad to get the subsidy-junkie Scots off their backs. The London treasury knows the truth, though, and the issue of control over North Sea assets could not be more sensitive. The truth is that Scotland's North Sea resources are the UK's economic umbrella.

Nationalist self-imposed shoogly peg

Set against this economic reality it makes perfect sense for the SNP to prioritise securing more tax powers for Scotland's parliament in advance of the referendum. If parliament secures more economic powers - especially corporation tax - then full independence will become increasingly certain as the divergence of the Scottish and English economies gathers pace.

One potential pitfall for the referendum 'Yes' camp though is the thorny subject of currency. Scotland's Finance Minister John Swinney simply must face the issue of a Scottish currency head on. It is unfortunate and potentially damaging that the SNP are uncomfortable on the subject of advancing an independent Scottish currency as the monetary gods are currently smiling on Salmond.

With the UK's debts mounting, London's approach will be to continue inflating debt away by increasing the money supply. This will accelerate the devaluation of sterling. It matters less then if Scots keep more of their money if that money buys less and so fiscal autonomy is only part of the economic powers equation.

There is a real opportunity for the Nationalists to argue that a strong Scottish currency, backed by oil, would quickly rise in value against sterling (suddenly not backed by oil) meaning Scotland's share of the UK deficit will be much cheaper to pay off. The case for an independent Scottish currency can be won in the boardrooms and it simply must now be the subject of national debate.

With such a strong case to make there is no reason to risk the distrust of Scots who have shown they want to be levelled with. And the currency issue will be brought up again and again by Unionists who sense the SNP's unease on the subject. With everything going the SNP's way why would they throw a lifeline to the 'No' camp?

Hanging Scotland's Jacket

Our independence referendum will of course be about many issues and at core be about how secure Scots feel about themselves and their culture. Perhaps it is a weakness that the debate is reduced to "little more than a car boot sale haggling session" but the fact is that much of the debate will centre on the issue of economics.

The problem for Unionism is that its economic rhetoric no longer mesmerises as it once did and so the 'No' camp must quickly get with the internet programme. The 'Yes' camp on the other hand is ahead of the game and has the momentum in a nation which seems to no longer fear the word independence any more.

The only danger for the cause of an independent Scotland is whether or not the 'Aye' camp will feed Scotland's insecurities and try to sweep the issue of currency under the carpet. If the latter want Scots to take a leap in the dark with them then Scots will have to believe that they are being told it like it is.


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Unionist expert backs Scottish independence

A piece I did during my tenure as Chief Editor of Newsnet Scotland. I will resumer publishing under the title Scottish Times in due course.

Analysis by Alex Porter

A clown twisting a balloon into a dog grabs children's attention briefly and increasingly briefly each time the child sees the same trick. The political editor of Scotland on Sunday (SOS) Eddie Barns's anti-independence articles have a similar impact.

In last week's SOS Eddie ran the lead story "SNP expert says split will hit economy". It's only once you've finally made it to the end of his piece that you realise that said expert is not in fact an SNP expert and he didn't say anything about how a split [independence] would 'hit' the economy.

The expert in question is economist John Kay who is not an SNP member but is in the Government's Council of Economic Advisors - an august body whose members straddle Scotland's constitutional divide. Having led his readers to believe that Kay is an SNP insider, Barnes reaches the breathless conclusion that Kay's opinion "undermines a vital plank of the First Minister's quest to break Scotland away from the Union". All that in the first paragraph and a half and typifies the recent hysterical reaction from the Unionist press since the landslide SNP election victory a month ago.

Professor Kay did mention that full independence would bring with it "complications" as does any responsibility and Kay does say that an independent Scotland would be "limited by the realities of globalisation" as all independent nations are but he didn't say that an independent Scottish economy would be "hit" or suffer in any serious way at all.

Kay, visiting Professor of Economics at the London School of Economics, supports fiscal autonomy which means all of Scotland's taxes being raised and collected in Scotland. Arguing that full tax powers would benefit Scotland, Kay's opinion actually undermines the postion of all the Unionist parties, none of whom support fiscal autonomy. As fiscal autonomy is not on offer it would be more credible to interpret Professor Kay's view as showing that continued Union will hit the Scottish economy. Indeed, Professor Kay actually said that an independent Scotland is a "perfectly viable economic prospect". Last week's SOS could easily have led with "Unionist expert backs Scottish independence" as its headline.

Professor Kay's take is that Scotland would benefit from being part of a larger state within the Union so long as it controls and collects all its own taxes. This is a reasonable opinion which finds wide support in Scotland.

His analysis does however ignore the the massive monetary downside of Britain's skyrocketing national debt and the consequent devaluation of the pound. The realities of UK PLC are that there is no economic umbrella as the Coalition Government's policy of currency devaluation destroys savings and pensions - a backdoor tax or wage cut. Devaluation brings inflation as overseas products become more expensive meaning your family budget doesn't stretch nearly as far as it did last year.

Considered political journalists can get the economics of independence badly wrong too. On the same day across the M8 at the Sunday Herald Iain Macwhirter perpetuated the unionist myth about Scottish banks being bailed out at English tax-payers' expense. Iain still hasn't got his head round the fact that it was the bank's shareholders and bondholder, based mostly in the City of London, that were bailed out at the expense of all taxpayers including Scottish ones. There are numerous examples of governments bailing out their home-based companies and banks who lost money through foreign investments. Why would an independent Scotland bail out London-based investment houses, who did not do their due diligence and so made poor investment decisions, at all?

And given Iain's left credentials perhaps he can tell us why any of these banks should have been bailed out by the taxpayer at all - a point ably made last week by Professor Kay.

Macwhirter moves on to the subject of fiscal autonomy: "Fiscal autonomy is fine, but do you want control of taxes in order to cut them to promote enterprise, or raise them to meet ambitious social objectives? You can't do both."

The point of fiscal autonomy is indeed partly that - the policy privilege of exerting your own priorities. However another key point which is completely missed by Iain is that having those powers, in itself, would give Scotland a wage increase. So, you have more money before making your policy choices as a nation and there are plenty examples to demonstrate this. So with an increase in income you actually can "do both" or incentivise enterprise while maintaining social spending for example.

That, at least, is the position of one internationally renowned expert in Economics. Professor Andrew Hughes Hallet of St. Andrews and George Mason University in Virginia this week backed the ability of Scotland to improve its economic performance by using the "whole range of fiscal policies" independence would bring.

I'm pretty sure Hughes Hallet's independence endorsement will not be described by Eddie Barns as "supporting a vital plank of the First Minister's quest to argue the SNP's case for Scottish independence". Something tells me that's not in Eddie's box of tricks.


News Scotland

Apologies for being away

Apologies to followers of my blog. I've been busy working with Newsnet Scotland. Now that the election is safely out of the way I hope to be able to update my site from time to time.





News Scotland

Not being independent is costing Scots jobs and prosperity

A piece I did for during my tenure as Chief Editor of Newsnet Scotland. I will soon resume publishing under the title Scottish Times.

by Alex Porter

As the party leaders clashed last night during the latest TV debate, Iain Gray claimed Alex Salmond’s dream of an independent Scotland would cost every Scot £2600. With the election now reaching fever pitch and Labour well behind in the polls and facing the loss of some high profile MSPs, Mr Gray resorted to spreading fear and panic insisting that Scotland would be left with a £13.75 billion black hole in its finances if it became independent.

Before the 2007 election Labour warned that every Scot would face a £5000 tax bomb were the SNP to be elected and many were turned off voting for the party. The reality of the SNP government was that Scots had their Council Tax frozen which actually reduced stress on family budgets.

The most recently available official figures show that Scotland's national accounts run a surplus. Scotland's financial position in the financial year 2008-2009 was a budget surplus of £1.3 billion (GERS) while the rest of the UK has been running the highest deficits in its history.

The question the Scots electorate might be then be forgiven for asking is why their nation should be shackled to the UK economy and paying the price for massive deficits it doesn't contribute to. With UK government debt heading for the £1 trillion mark and with no sign of Westminster tax-take increasing in the drowning UK economy, Scots can look forward to years, if not decades, of increasing austerity cuts if we remain within the confines set for us by Westminster rule.

London-driven public sector cuts have been foisted upon Scots to pay for the failure of economic policies largely under Gordon Brown's Labour government and then continued by the current coalition. The result of this chronic economic mismanagement is the UK's financial, economic and currency crises which Scots have no option but to watch their cities, communities and families being dragged into.

Despite this corrosive economic environment at UK level, Scotland's national accounts have heroically remained in surplus and employment trends have bucked the depressing UK reality. This is testimony to the sound management of the SNP, and especially Finance Minister John Swinney, who has created enormous efficiency savings in the way government is run, particularly in the area of public sector procurement. It is regrettable that Scots cannot reap the rewards of these savings and instead continue to face a reduction in their parliament's block grant from London.

The harsh truth is that with the relative value of the pound collapsing and UK debt continuing to rise to unsustainable levels, Scots must consider their options and decide what powers their parliament needs most to protect their families, jobs and businesses.

North Sea oil is currently underwriting UK government borrowing. Without it the UK would be insolvent. With around 8% of the UK population, estimates put Scotland's contribution - through North Sea oil revenues from corporation tax alone - at 20% of the UK total. That figure disregards taxation raised at the pump.

In an independent Scotland that money would be reinvested in jobs and services. With the second-largest pension fund in the world, Norway, the richest country in the world according to the Legatum Property Index 2010, shows that rather than face a future of austerity Scots could, and perhaps should, be building a prosperous future for their children and grandchildren.

In poll after poll Scots have shown that they want their parliament to have more economic powers. In order to thwart that expressed desire the Unionist parties have designed, what they shamefully call, the Scotland Bill in order to give the impression that more powers are about to be returned to Scotland, but upon closer scrutiny we can discern that more powers will be re-reserved to Westminster.

Another cruel piece of rhetoric being disseminated by the Scotland's too wee, too poor and too stupid brigade is that an independence referendum would distract government from improving the economy. Firstly, it seems that the more attention the last Labour government and the current coalition government pays the economy the worse it seems to get. That aside, Scots are more than capable of having a national debate on independence while still going to work. If we can watch EastEnders and work, if we can read newspapers and still run a family budget and if we can follow the football while making sure the BBC licence is still paid then the Scottish government can bring forward the independence referendum that Scots want, while still managing to get on with improving the economy - something only the SNP government in recent years has been capable of doing in any case.

The truth is, though, that independence is about improving Scotland's economy. Without independence Scots, through their parliament in Edinburgh, do not have the collective powers to really put jobs and prosperity back on the national agenda. It is a daily economic crime that Scots are misled about the economic lifeboat of independence whilst the truth of what lies ahead for the UK Titanic is kept from sight.

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