Meeting of the Parliament 18 June 2014
Earlier this week I joined my colleagues in the Scottish Conservatives and the Scottish Liberal Democrats to pledge more powers for Scotland. The people of Scotland now know that, whatever the result of the referendum, there will be change, and that the choice is between separating completely and going off on our own, and continuing to share power with our neighbours where we believe that it is in our interests to do so.
The debate about more powers for Scotland is interesting, whether the powers come to a devolved Parliament or an independent one. The debate has been allowed to dominate Scottish politics over a period, but we should not allow it to distract us from considering the significant powers that the Scottish Parliament has. The keys to realising our ambitions for Scotland already lie in Holyrood, and the Scottish Government has the power to set priorities.
In education, we have the ability to teach, train and skill up our children and young people, so that they can take up chances to drive a new, changing economy, and we have the ability to give people who lose their jobs opportunities to retrain for their next jobs. In health, we have the means to ensure that our sick, our vulnerable and our elderly are supported and cared for with the respect and dignity that we would want, and to build a Scotland in which people’s physical and mental health is such that they can take up the opportunities that we create for them.
Too often, we spend our time in this Parliament debating what we cannot do. We do not spend enough time talking about what we can do. For some time, the Parliament has failed to be a forum for new, radical ideas about improving educational standards or closing the gap on health inequalities, and it will not be such a forum until we get past the constitutional question.
Issues to do with schools and hospitals remain a key factor in the referendum campaign. That is because people are asking themselves whether a yes vote or a no vote is best for public services. I believe that a no vote gives Scots the best of both worlds: schools and hospitals that are delivered by a Scottish Parliament that is backed by the economic security and stability of the United Kingdom, which allows us to invest in our priorities.
I am sure that my yes colleagues will argue that in an independent Scotland there will be more money to spend on the things that matter. The economics of independence have long been debated by both sides and are a key area of the campaign that we will debate again. Members of the Scottish public—the people who will come together to decide our future on 18 September—will have to choose which side to believe, whose arguments make the most sense and what fits best with their view of the future.
People often bemoan having to make a choice between competing arguments and facts. They see politicians setting out seemingly contradictory positions and appearing to argue that black is white, and they are left wondering who to believe. They cry for good, impartial information. They want to hear unbiased, unvarnished facts, which will allow them to make the key decision on behalf of their families.
Yet there might never in Scottish history have been a vote in which people have had more information. A small industry has been set up to analyse the consequences and ramifications of an imaginary world that might never happen. The key question is whether Scots would be better or worse off if they voted to leave the United Kingdom.
The fact that that is debated at all illustrates how difficult it is to pick through the assumptions and predictions. However, many people have tried to do so. Let us consider what some of the experts—the economists and the think tanks—say. The Institute for Fiscal Studies said:
“Our calculations suggest that an independent Scotland could expect to be running a deficit of around 5% of GDP in 2016-17, which would be larger than that facing the UK as a whole, and would necessitate tax rises or spending cuts.”
The Centre for Public Policy for Regions said:
“there will be a net fiscal loss under independence, looking into the future.”
Citigroup said that, with the recent drop in oil revenues, Scotland’s fiscal deficit is now significantly above UK levels, and the Pensions Policy Institute said that a future Scottish Government would need to raise tax, cut spending or accept higher debt.
Brian Ashcroft, emeritus professor of economics at the University of Strathclyde, said:
“Scottish government outlays would rise ... That would mean additional borrowing, or a diversion of spending from investment in the people of Scotland.”
Martin Wolf CBE, the chief economics commentator for the Financial Times, said:
“To avoid the risk, it would need to lower its debts quite rapidly. This would require even greater austerity than in the UK as a whole. Given its close ties to the rest of the UK, Scotland could not get away with taxing corporations or skilled people more heavily than its neighbour. So the bulk of this extra austerity would surely fall on public spending.”
I believe that a consensus is growing among those financial experts that Scotland would be worse off and that there would be less money to spend on the things that matter. On the one side, we have professors, economists, academics and policy experts all saying the same thing—that Scotland would be worse off. On the other side, we have a group of people—Alex Salmond, Nicola Sturgeon and John Swinney—arguing the opposite. They say that they like independence, but the last thing that they will listen to is independent experts who examine their plans.
The central deceit at the heart of the nationalists’ case for independence is the belief that the land of milk and honey is possible simply with a yes vote. Do you want tax cuts? You can have them with a yes vote. Do you want better childcare? You can have it with a yes vote. A new industrial strategy? Just vote yes. Every day, the SNP’s offer grows larger and larger, suspending the rules of arithmetic with every promise and pledge.
However, here is the reality as confirmed by the leading financial experts and economists who have looked at the costs. If Scotland was to vote yes, the first Government of the newly independent country not only would not be able to deliver the litany of wonderful things that Nicola Sturgeon and her colleagues promise every day; it would not be able to deliver even what we have now.