ALEX Salmond’s proposal for a “Scottish Pension Fund” as part of a strategy to rebuild the nation’s economy in the wake of the coronavirus pandemic could be worth billions of pounds within its first 10 to 20 years, according to the SNP MSP who worked with the former first minister on the blueprint.
The plan put forward would require major energy companies – both in renewable and in the oil and gas sector – to give a proportion of the profits they generate to a Scottish state energy company as a condition of their projects being given the go ahead.
It is modelled on a scheme which Norway introduced after companies began drilling oil off its shores in the late 1960s.
The Norwegian fund is now worth almost a trillion pounds and is partly responsible for the country’s high standard of living.
SNP MSP Alex Neil said that there was “huge potential” for Scotland to use its energy resources to establish a similar scheme.
“There is huge potential here for offshore wind projects with all the jobs and the benefits to the environment they will bring, and at the same time if we play our cards right we can get a share of the profit to invest in the Scottish Pension Fund for the long-term benefit of the Scottish people,” Neil told The National.
“The key point about the Norwegian fund is if you look at Norway today the major income it gets from oil, isn’t through taxation it is through the share the national state oil company gets from the companies that were given licences to extract the oil from Norwegian waters.”
Asked about how much the Scottish fund could be worth in the medium term, he said: “I think over a period of 10 or 20 years we are talking about billions rather than millions.”
The fund was among a list or proposals contained in an economic strategy to rebuild the country post Covid unveiled by Neil and Salmond on Tuesday.
Other proposals included a house-building drive, zero-interest loans for businesses and a stepping up of work to reduce a skills deficit in areas such as IT and the NHS.
On the energy sector programme, it proposed the creation of a Scottish National Renewable Corporation (SNRC) with 5% stake in licensed projects of 20MW and above.
It said revenues generated should be used for several purposes including the securing of renewable investment for the Scottish supply and that some 50% of the dividends to be invested in energy research and in emerging wave and tidal energy companies and technologies.
The report states: “From small beginnings, this will accumulate into a generational fund for the Scottish people benefitting for the first time directly from the enormity of our
natural resources onshore and
offshore. The extraordinary endowment of natural resources has given Scotland a further opportunity to benefit from our position as a renewable powerhouse of the European continent. This will be our second chance in energy. We may not get a third.”
Neil said it was clear that with every major country in the world having set targets to cut carbon emissions by 2030 to 2050, there would be a huge need to get their energy supply from renewable sources.
He said: “This means that there will have to be very heavy investment globally in renewable energy, plus some traditional resources are running out.
“So there is going to be massive investment in new technologies to achieve these targets and very clearly both off and onshore wind is going to be a major player in that global energy revolution and Scotland is well-placed to get a fair share of that investment. And what we are saying is that we should ensure the Scottish people get a fair share of the profit.”
Neil said they would be sending a copy of their blueprint to Finance Secretary Kate Forbes and would be happy to discuss them with her.
A Scottish Government spokesman said: “We are determined to do everything within our current powers to protect jobs and to help Scotland’s economy on its path to a strong and lasting recovery. Our recent launch of the Scottish National Investment Bank will be a key part of that, helping to tackle some of the biggest challenges we face.”
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