A LEADING economist has supported Nicola Sturgeon’s view that Scotland is fundamentally a prosperous nation despite the dip in oil price which has impacted on offshore revenues and led to a significant fiscal deficit.
Dr David Phillips, senior research economist of the Institute of Fiscal Studies, backed the First Minister’s stance as the Government Expenditure and Revenue Scotland (GERS) statistics reveal oil revenues fell from £1.8bn in 2014/15 to £60m in the last financial year.
The figures also show a deficit of £14.8 billion when a geographic share of North Sea revenues is allocated to Scotland, up from £14.3 billion in 2014/15, amounting to 9.5 per cent of Scottish GDP, compared with the overall UK deficit of £75.3 billion – four per cent of UK GDP. But Phillips said despite the stark deficit details in the GERS report it showed Scotland was among the most prosperous parts of the UK.
“I think the figures show that the onshore economy of Scotland has been performing relatively in line with that of the rest of the UK. It certainly is not like Wales and Northern Ireland. It is a relatively affluent part of the UK in the tax revenues it raises. They are not quite as a high as the rest of the UK as a whole, but its revenues onshore are pretty robust.”
Phillips said that the challenge for Scotland was that despite being relatively affluent, the country had high levels of public spending and experienced “volatility” in revenue streams because of the North Sea oil industry.
He added that a stronger economy could be developed under independence, if Scotland negotiated a beneficial deal on debt and cut back on public spending, including on defence, and raised taxes.
Dr Neil McGarvey, politics lecturer at Strathclyde University, said independence could allow greater flexibility over policy areas including on immigration, which could boost tax revenue.
“Part of the problem at the moment is that most of those levers are either at a UK or EU level and under independence some of them would be returned to Scotland,” he said.
“Scotland’s needs in terms of migration are far different from the needs of the rest of the UK’s economy. Scotland has plenty of space, it has the capacity to take more migration. Scotland has a vibrant higher education sector. International student recruitment here is a big issue and Brexit would be a major issue in Scotland in that area.”
http://www.thenational.scot/news/Nicola Sturgeon: Scotland is strong enough to go it alone.21579
http://www.thenational.scot/news/Plea for action to boost the economy via business growth.21588
Why are you making commenting on The National only available to subscribers?
We know there are thousands of National readers who want to debate, argue and go back and forth in the comments section of our stories. We’ve got the most informed readers in Scotland, asking each other the big questions about the future of our country.
Unfortunately, though, these important debates are being spoiled by a vocal minority of trolls who aren’t really interested in the issues, try to derail the conversations, register under fake names, and post vile abuse.
So that’s why we’ve decided to make the ability to comment only available to our paying subscribers. That way, all the trolls who post abuse on our website will have to pay if they want to join the debate – and risk a permanent ban from the account that they subscribe with.
The conversation will go back to what it should be about – people who care passionately about the issues, but disagree constructively on what we should do about them. Let’s get that debate started!
Callum Baird, Editor of The National
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here