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Swinney responds to IFS
Report highlights case for independence.
Commenting on the report from the Institute for Fiscal Studies, Finance Secretary, John Swinney said:
“This report actually underlines the case for an independent Scotland with full control of its own economy and the ability to take decisions that can secure a stronger and more prosperous future for the country.
“It is no surprise that projections based on the UK’s economic position show a long term deficit when the OBR state that the UK’s economic strategy is “unsustainable” and that the UK will run a fiscal deficit in each of the next 50 years.
“The IFS themselves admit their projections in this report are ‘inherently uncertain and could evolve differently if Scotland were independent rather than part of the UK; in addition they could be substantially effected by the policies chosen by the government of an independent Scotland’.
“The whole point of independence is to equip Scotland with the competitive powers we need to make the most of our vast natural resources and human talent and to follow a better path from the current Westminster system which stifles growth and which is responsible for the damaging economic decisions which this report – and its projections – are based on.
“Scotland has strong financial and economic foundations, and even without a single penny from oil and gas, both output and tax revenues per head in Scotland are virtually the same as for the UK.
“Next year’s independence referendum will give people in Scotland a choice between staying with a broken Westminster system that has created one of the biggest gaps between rich and poor in the western world, which concentrates far too many jobs in London and the South-East of England, has accumulated vast amounts of debt and which neglects manufacturing and trade – or using the full tools of independence to rebalance the economy, improve equality and support public services.
“Between 1977 and 2007, smaller independent European countries similar to Scotland grew their economies faster than ours, and if we had matched those rates that greater output would now be the equivalent of around £4.5 billion.
“Tomorrow the Scottish Government will publish detailed analysis of the economic security, growth and job opportunities that come with the powers of independence and by taking Scotland’s future into Scotland’s hands.”
Notes to editors
- Chapter 3 shows how sensitive our projections for borrowing and debt in Scotland are to some key factors. In particular, we show sensitivity to alternative assumptions about inward migration, future productivity growth, the change in revenues from North Sea activity, the initial allocation of accumulated debt between an independent Scotland and the rest of the UK, and the interest rate payable on public debt. These factors are inherently uncertain and could also evolve differently if Scotland were independent rather than part of the UK; in addition, they could be substantially affected by the policies chosen by the government of an independent Scotland. (p7)
The Office for Budget Responsibility forecasts that, the UK will still be in deficit in 2018-19 when the process of fiscal consolidation is expected to finish and will run a fiscal deficit in each of the next fifty years (2013-14 to 2062-63) – Source - OBR Fiscal Sustainability Report.