Independence (Economic Impact)

– in the Scottish Parliament on 6th November 2019.

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Photo of Anas Sarwar Anas Sarwar Labour

5. To ask the Scottish Government what plans it has to publish an assessment of the possible economic impact on Scotland of it leaving the United Kingdom. (S5O-03707)

Photo of Ivan McKee Ivan McKee Scottish National Party

In this year’s programme for government, the Scottish Government committed to updating the plans that it made for an independent Scotland in advance of the 2014 referendum. Currently, the greatest threat to the Scottish economy is presented by Brexit. Last week, we published a further “Scotland’s Place in Europe” paper, assessing the revised withdrawal agreement and political declaration. The paper highlights the damage that will be done to Scotland should the UK leave the European Union under the deal and underscores the importance of allowing the people of Scotland the opportunity to choose their own future.

Photo of Anas Sarwar Anas Sarwar Labour

The Scottish Government was right to publish its economic impact assessment of Brexit, because it would damage our economy, cost jobs and cause cuts to our public services. However, we cannot defeat chaos with more chaos. We share a border with England, we trade more with the rest of the UK than we do with the rest of the world combined, and our nations have been intertwined for 300 years.

We should not let any nationalist ideology damage the interests of Scotland; that is why I support the UK staying in the European Union and Scotland staying in the UK.

If the minister genuinely believes in standing up for Scotland’s interests, why does he not do the same?

Photo of Ivan McKee Ivan McKee Scottish National Party

I am not sure where to start with that.

As I said, the Scottish Government has committed to updating the economic impact assessment in advance of any future referendum, which is exactly what we will do. That will be very different from what was done in the UK in advance of the EU referendum, when all we had was a slogan painted on the side of a bus. The member might care to look at the work of the Sustainable Growth Commission or at the situation in which many of our small, independent neighbours in Europe find themselves. Because such nations have the ability to make their own economic decisions and decide their own futures on the basis of what is best for their economies, they have gone from strength to strength—unlike Scotland, which has suffered because it has been part of the union.

Photo of Dean Lockhart Dean Lockhart Conservative

The Scottish Government’s website publishes the Government Expenditure and Revenue Scotland figures, which show that Scotland has a fiscal deficit of £12.6 billion. It describes those figures as being

“produced in line with the Code of Practice for Official Statistics ... free of political interference” and providing a reasonable basis for assessing Scotland’s stand-alone fiscal position. Does the minister agree with that description?

Photo of Ivan McKee Ivan McKee Scottish National Party

Yes, I do. However, as the member will understand, the GERS figures also reflect Scotland’s current position as part of the union. He will also understand that if Scotland were given the opportunity to make its own economic decisions as an independent country, its economic position would be very different from the one that it currently suffers because it is part of the union. Further, he will be aware that the work of the Sustainable Growth Commission, which tracks Scotland’s deficit reduction over time, has predicted that our deficit reduction will reduce to below the level that is required by international norms. We are currently progressing in advance of that reduction and doing better than the Sustainable Growth Commission predicted when its work was published two years ago.

Photo of Gil Paterson Gil Paterson Scottish National Party

Can the minister explain how it is possible for Scotland to have a deficit when we cannot borrow any money, and how, if the Government does not spend up to the limit that it has, we could then lose the right to govern this country?

Photo of Ivan McKee Ivan McKee Scottish National Party

As the member has correctly identified, the Scottish Government’s borrowing powers are severely restricted and it has to manage within the budget that is allocated to it, which it balances on an on-going basis—unlike the UK Government, which runs up significant deficits.

As I indicated, the GERS figures reflect the notional position that Scotland would be in were all those numbers allocated to its accounts. However, as I also said, they reflect the position in which Scotland finds itself as part of the union and not the one that it would find itself in as an independent country, which, like other such countries, could make economic and fiscal decisions to suit its own economy and population.