Unanswered Questions

Here are some things we know:

1. The United Kingdom and Scottish Governments disagree over whether independence will make Scots richer or poorer. The Treasury says we’ll each be £1400 better off every year for 20 years if we stay in the Union. The Scottish Government says that after 15 years of independence we’d each be £1000 per year better off.

2. The Financial Times says the first figure is “specious”, because it’s inevitably based on assumptions and projections about future costs, which are notoriously difficult. But the FT also says that the Scottish Ministers’ figure is “more egregious” and “an insult to the intelligence of the land of Adam Smith and David Hume”. And the FT is not alone in pouring scorn on the magic beans fantasy economics offered by the Scottish Government. Check out the verdict of the independent IFS, for example, which highlights the serial ways in which Mr Salmond’s projections are unrealistic, over-optimistic, and not shared by independent experts.

3. The independence White Paper, as well as being legal junk, is now also economic junk, based as it is on projected oil revenues which John Swinney has now had to admit are completely over the top: his five-year outlook of £48bn has been downgraded to a maximum of £39bn. And even that is well above the OBR’s forecast of £16bn. It is worth noting in this context that, as the Herald reports, “the OBR have consistently over-estimated such revenues in the past”.

And now here is one (rather important) thing we do not know:

1. What would independence cost?

The Treasury yesterday tried to put a figure on what it considered would be some of the costs of independence. But even their figure appears not to take into account a range of factors that have been highlighted in previous contributions to the debate, such as the loss to Scotland of EU payments (under the structural fund and the common agricultural policy), which Scotland would not be entitled to in the period between becoming independent and acceding to the European Union — and it seems inevitable, on the SNP’s chosen timetable, that there would be such a period. So any figure given by the Treasury yesterday of the independence price-tag is highly likely to be an under-estimate.

The Treasury’s analysis of the costs of independence comprised a series of factors: (a) that an independent Scotland would start off in life in a worse financial position than the rest of the UK; (b) that an independent Scotland would face start-up costs for a range of public institutions and services; (c) that an independent Scotland would face higher borrowing costs; (d) that an independent Scotland’s oil and gas revenues would be lower than projected by the Scottish Government; (e) that the more rapidly ageing population of an independent Scotland would further squeeze Scotland’s public finances and (f) that the uncosted policy promises contained in the independence White Paper would in fact cost at least £1.6bn every year.

On BBC Radio Scotland yesterday John Swinney disputed the Treasury’s numbers but was unable to supply alternative figures of his own. In one interview he was asked 11 times — or was it 13? — what the start-up costs of independence would be. On each occasion he could not answer the question. Perhaps the maths are too difficult for him, so let’s break it down a bit, and work our way through the Treasury analysis step by step.

Starting off in a worse financial position

Onshore tax revenues per person are lower for Scotland than for the rest of the UK (i.e., we pay less in tax) whilst, at the same time, public spending in Scotland is higher per head than it is in the rest of the UK. This is known as the “Scottish fiscal deficit”. And it is about £1000 higher per person per year in Scotland than it is the rest of the UK. This is not a Treasury estimate: it’s based on three independent sources — the IFS, Citigroup, and the Centre for Public Policy and Regions. Unanswered question 1: how would an independent Scotland fund the Scottish fiscal deficit: by implementing spending cuts of £2.5bn, by increasing taxation by this amount, or by borrowing? in other words, how would an independent Scotland avoid an austerity programme far worse than anything contemplated by the UK Government? “Vote Yes for Austerity” — perhaps that was the theme of YesScotland’s new cinema ad that we’ll never now see.

Start-up costs

An independent Scotland would need a new (or a much enlarged) tax collection agency. It would also need new agencies to process and distribute welfare payments, as well as armed forces, security and secret intelligence services, new regulatory agencies, and a new diplomatic corps, etc. The creation of such agencies would inevitably require spending on staff and training, building, infrastructure and equipment, and IT. We know that none of this comes cheap (remember the scandal over the cost of the new Scottish Parliament building?). To put it into perspective, under the Scotland Act 2012 a new body, Revenue Scotland, is being created now in order to collect the new Scottish Landfill Tax and the new Scottish Stamp Duty, both of which are devolved to the Scottish Parliament under that Act. On the Scottish Government’s own figures, it is costing £20.2 million to establish Revenue Scotland and to run it for five years. £20.2 million just to collect two small taxes. (In 2006-07 Scottish receipts from Landfill Tax were £75 million; in the same year Scottish receipts from Income Tax were £10.5 billion — a sum 175 times greater.) The Treasury estimates the cost of extending the powers of Revenue Scotland so that it could collect all taxes in an independent Scotland to be £560 million. The Institute of Chartered Accountants in Scotland (ICAS) puts it even higher, at around £750 million. The Scottish Government’s own figures show that the annual running costs are estimated to be £575-625 million.

And that’s just tax collection. What about welfare payments? Again, the Treasury has estimated that the IT costs alone would set Scotland back by up to £400 million. And what about the armed forces, and international representation? Here, the Scottish Government appears to think that everything could be covered through Scotland inheriting her share of existing UK assets but, as I and others have shown over and again, it is nothing like so simple. As a matter of law, for example, the overseas property of the UK would not fall to be apportioned between an independent Scotland and the rest of the UK: rather, the UK’s international representation, including its network of embassies and consulates around the world, would become the international representation of the rest of the UK, in the event that Scotland voted to leave the UK to form its own state. Scotland would have to build its own from scratch.

The Treasury has estimated that the start-up costs of a Scottish state’s new institutions is likely to be at least £1.5bn. Scottish Ministers dispute this figure, but refuse to supply an alternative. Unanswered question 2: if the Scottish Ministers do not accept that it would cost an independent Scotland £1.5bn to establish the institutions and public services it would need, what is their alternative figure and how has it been calculated?

Higher borrowing costs

Peter Jones in the Times today writes as follows: “If it wants to invest in infrastructure at the rate it thinks is needed, pay for new buildings to house the staff replicating services now provided by the UK, and deal with financing shortfalls caused by uneven tax revenue flows, an independent Scotland will need to borrow and pay interest, every non-aligned analyst has concluded, at higher rates than does the UK”. Unanswered question 3: how much will that cost? (And who are these “non-aligned analysts”? They include the National Institute of Economic and Social Research, Prof Charles Goodhart, Prof Ronald Macdonald, Jeffries International, Citigroup, Deutsche Bank and Blackrock.)

Oil and gas revenues

See above, “things we know”, point 3. The question about oil and gas revenues has been answered, but only in a manner that undermines the forecasts underpinning last year’s independence White Paper. I wonder if there will be a second, revised, edition later this year…?

Demographic challenges

The elderly pay less tax and rely more heavily than most on health and social care. The proportion of working-age taxpayers to the elderly (and to children, who pay no tax and consume state-funded education services) is of critical importance to effective management of public services. All the evidence shows that Scotland faces particular pressures in this regard: projected population growth is less than for the rest of the UK yet, at the same time, Scotland’s population is ageing more rapidly than that of the rest of the UK. Sources for this evidence include National Records of Scotland (in evidence to the Scottish Parliament) and the UK Statistics Authority, as well as the IFS. To my knowledge, Scottish Ministers do not dispute this evidence. They propose that an independent Scotland would meet this demographic challenge through attracting immigration into Scotland. Yesterday, the First Minister said that an independent Scotland would need to attract 24,000 people into Scotland annually. But this poses several problems for him. First, within six years of independence Scotland would need a new city the size of Dundee to accommodate its 150,000 new immigrants. Secondly, there is no guarantee that Scotland would attract that many people to migrate annually (the UK Government has said that 15,000 annually would be more realistic; the IFS have said that 7,000 is nearer the mark). Thirdly, there is a direct clash between Scotland having an immigration policy such as this and Scotland becoming a member of the Common Travel Area with the rest of the UK and with Ireland. The CTA requires its members to follow a broadly similar immigration policy. Mr Salmond cannot guarantee that the border with England would remain open at the same time as seeking to bring 150,000 new immigrants into Scotland in the first six years of independence. Yet, on his own figures, without the new immigration Scotland fails to meet its demographic challenge. So unanswered question 4 is: how is Mr Salmond’s new immigration policy consistent with the commitment given by his Government in the independence White Paper that “there will be free movement across the border between Scotland and England”?

The SNP’s policy promises

That independence White Paper was famously uncosted. So the Treasury have run the policies through their models and have costed them as follows: increased childcare provision will cost £570 million in the first year; reducing Air Passenger Duty by 50% will cost £130 million in the first year; and reducing Corporation Tax by 3 points below the UK rate will cost £300 million in the first year. That’s £1bn of additional public spending in the first year. And that’s looking only at the SNP’s first term spending commitments, saying nothing of their further commitments thereafter (such as the further increases they have promised in childcare provision). Our fifth unanswered question is: how is all this to be paid for?

I shall resist the temptation to ask, finally, what the currency is in which an independent Scotland would meet these costs. I’ve asked that question before. It’s still unanswered.

Yesterday was an unusually noisy day in the ongoing indyref campaign. Amid the noise and haste a lot of big numbers were thrown by each side at the other: £1400 here and £1000 there. To my mind, the numbers themselves are of little consequence. But what does matter, it seems to me, are questions I’ve tried to set out here: just the latest in a long and growing line of unanswered questions about independence which the Scottish Ministers are either unwilling or unable to answer. Their refusal just piles on more and more reasons to Vote No. There is a better future for Scotland than this.


Scotland and Europe, Part 1

One of the Known Unknowns in the independence debate is whether and, if so, how and on what terms an independent Scotland would accede to membership of the European Union. Scotland and Europe, Part 2, will deal with those issues fully, soon. It will show that Scotland would accede to the EU — eventually — but that on no credible view would it do so before the projected Independence Day of March 2016. As such, Scotland would start its life as a new state outside the EU, a fate that would cost Scottish households dear. More of this anon.

But the results of the European Parliament elections have interrupted me. These results are important for the indyref: not because they tell us anything very much about what the result is likely to be come 18 September, but because they will shape the way the campaign develops from here — and in ways that do not suit the planned SNP narrative.

Have you ever wondered why the date of 18 September was chosen (by the SNP) for the independence referendum? September is an unusual month for a poll in the UK. We vote most often in May, with October and March generally being the default substitutes. I’m told by SNP insiders that the date was chosen because it was the closest possible date to the European elections. There are two schools of thought as to how Yes can win the referendum: the first is that they need a “gamechanger”; the second is that they win by stealth. As the months drag on, more No voters turn Undecided and more Undecideds are converted to Yes; meanwhile once a Yes voter always a yes voter — there is never any going back once someone has made their mind up to leave the UK. This in a nutshell is the second school of thought and for four or five months it seemed as though it might have got it right. From December 2013 until April 2014 the polls started to close; reports were rife of panic in the Better Together camp; and “momentum” was reported to be with the Yes camp, and building. No more. Momentum has stalled; the polls show that No’s lead is growing once again; and the stories from the Better Together campaign are of renewed focus, increased resources, and more effective campaigning. So we’re back to the first school of thought. The European elections were supposed to be the gamechanger that Salmond needs.

How? In short: UKIP. Long since forecast to win the poll in England, UKIP have struggled even to get a foot in north of the border. We all know those images of UKIP leader Nigel Farage seeking refuge in an Edinburgh pub when one of his ill-fated sojourns to Scotland went sour. This is not because Scotland is vastly less Eurosceptic than England. UKIP, despite its name, seemed to be anything but a UK party. It was England’s National Party; and it could not get going in Scotland because here we already have a successful National Party of our own, thank you very much.

If UKIP won in England but were frozen out in Scotland, Salmond would have used this in two ways: as an answer to his own EU problem; and as a wedge to show that Scotland and England were further apart politically than ever, that their National interests were diverging and not converging, that these really were two countries, and that they should be independent of one another. No doubt, we’ll hear plenty of this despite the European election results. But be in no doubt: those results make this a far less credible story than Salmond wanted. No gamechanger this.

UKIP did much better in Scotland than expected. They pushed the Greens into fifth place and the Lib Dems into a sorry sixth, and took the Lib Dems’ one Scottish seat in the European Parliament. We all knew the LDs were going to lose the seat, but the majority view was that it would go to the SNP. As it is, instead of SNP 3, Lab 2, Tory 1; we’ve got SNP 2, Lab 2, Tory 1, UKIP 1. This matters, because it brings the Scottish result more clearly into line with others in the UK: the result in London, for example, was Lab 4, Tory 2, Green 1, UKIP 1. It matters also because the one party in Scotland from whom UKIP did not take votes is the Tory party. The Conservatives’ share of the vote in Scotland went up (as it has done now in more than a dozen consecutive elections). The centre-right in Scotland is growing and the left-wing idealism that Caledonia is Dreaming a socialist future (Gerry Hassan) and that Scotia is about to Blossom into a socialist nirvana (Lesley Riddoch) has been shown to be a view beloved of the National Collective but not so much of national electorate. Surely the maddest reason of all to support Scottish independence is that it would embed Scottish social democracy: it would do precisely the opposite, and place it into greater jeopardy than any No vote. But, again, I’m anticipating future posts …

Back to the Euros. What now of the two uses Mr Salmond had wanted to make of this weekend’s results? First, do they make it any easier for him to deflect uncertainty over the status, timing and terms of an independent Scotland’s EU membership? They do not. The results demonstrate neither an overwhelming English majority in favour of the UK leaving the EU; yet nor at the same time do they show that there is no support for such a move north of the border. I fully accept that Euroscepticism may be more prevalent in England than in Scotland, but it is a difference of degree, not of kind. There is no evidence to support the view that a No vote in the independence referendum will lead to Scotland being taken out of the EU against its will by Eurosceptic voters in the rest of the UK. Whereas there is every evidence that an independent Scotland would not be able to join the EU until some time after independence day and, moreover, that Scotland would never be able to join the EU on terms as favourable as those currently enjoyed by the UK.

Secondly, do this weekend’s results support the view that, for all Mr Salmond’s bluster to the contrary, Scotland and England are in fact not two nations in pursuit of divergent political goals, but continue to have far more in common with one another than is convenient for the Scot Nats to admit? Yes they do. One of the SNP’s most dangerous foxes has been shot. It is not UKIP that seek to set Scotland and England on different political courses: it is the SNP. London has one UKIP MEP; so does Scotland. And so does Wales. And so does the North East region of England.

I take no pleasure in UKIP’s success. I am enthusiastically of the view that the United Kingdom should play a leading role at the heart of a reformed European Union. But I am also of the view that political differences between Scotland and her southern neighbour are much exaggerated; that it suits those who seek the break-up of Britain to perpetuate such exaggeration; and that arguments seeking to set Scotland up as if it is some sort of northern cure for English diseases are both deluded and dangerous. A major element of SNP strategy unravelled this weekend. Unionists can surely welcome this without for a moment endorsing either the policies or the personnel of the wretched UKIP.




Two Positive Cases

There are lots of very good reasons for not voting Yes in September. I’ve written about a number of them here (notably, the SNP’s disaster of a non-policy on the currency) and I’ll write about others in due course (such as the prospects of Scotland’s EU membership). It is important, come 18 September, that we understand the reasons for not voting Yes as well as the many positive reasons why we should vote No.

In this post I make not one but two positive cases for a No vote: a positive case for Britain and a positive case for the Union.

What’s so Great about Britain, Anyway?

(1) A Global Force for Good

The UK enjoys a hugely privileged position in the world, being at the helm of the EU, the UN Security Council, NATO, the G7, the G8 and the G20. On 18 September we have a genuine choice to make: do we want to be small nation, minding our own business, a spectator of rather than an active participant in world affairs, sheltering behind our larger neighbour? Or do we want to continue to be part of one of the world’s most influential and extraordinary states?

Britain is the soft power superpower of the world. Our heritage, culture and language, the strength of our education and culture sectors, our promotion of free speech, parliamentary democracy and the rule of law are unrivalled anywhere in the world. The UK is the world’s second largest donor of international aid. Administered in large measure from East Kilbride, the Department for International Development has enabled five million children to go to primary school and has provided food aid for six million people. By 2015 DfID will have helped immunise 55 million children against preventable disease and will have helped save the lives of 50,000 women in childbirth and a quarter of a million new-born babies. UK aid by 2015 will have helped secure access to clean, safe water and sanitation for 60 million people worldwide.

We are a force for good in the world, but this reaps benefits at home, too. International scholarships helped bring more than 40,000 international students to Scotland in 2012 — more than 12% of the UK’s total. British Council school partnership programmes, such as Connecting Classrooms, enrich learning for school children in Scotland and the rest of the world alike.

Our seat at the top table is something we’ve become so accustomed to that we take it blithely for granted. But it is only through such a privileged position in the world that we are able to drive through the changes we want to see, whether it be our anti-corruption initiatives, our reforms of global financial regulation, or the global labour market reforms the UK has championed through its leadership of the G20, for example.

Throughout our history — and still now — the UK has played a lead role in strengthening the rule of law, in supporting democracy, and in protecting human rights around the world. From the campaign against the slave trade in the eighteenth century to the drafting of the European Convention on Human Rights in the 1950s, and more recently in relation to the creation in 2006 of the UN Human Rights Council, the UK has been in the driving seat of progress, enlightenment and reform. We make a major contribution to UN peace-keeping, where we are one of the top five financial contributors, paying some £365 million annually in assessed contributions.

The promotion of human rights and democracy are central policy objectives of the UK’s Foreign Office and, because of the UK’s global impact and influence, we are able to make a real and lasting difference the world over. To take a handful of examples: in 2013 alone the UK-led campaign for the abolition of the death penalty had results in Morocco; the UK’s support for peace, development and women’s rights had results in the Philippines; and the UK’s campaign to protect journalists and access to public information had results in Vietnam. After seven years’ work a UN Arms Trade Treaty was adopted in 2013 with 156 countries voting in its favour at the UN General Assembly. This was a major achievement for British diplomacy, as the UK was one of the states that had launched the campaign for the Treaty. But top of the list for 2013 was the UK’s ground-breaking work in its PSVI — the Preventing Sexual Violence Initiative — which was a core theme of Britain’s 2013 Presidency of the G8 and which led, among other successes, to a new UN Security Council Resolution and UN General Assembly Declaration on sexual violence within conflict.

When we say “Britain is a force for good in the world” and when we remind ourselves that “Britain punches above its weight” on the world stage these are cliches. But they are true. We are, and we do. But we don’t sing and dance about it very much. We’re more prone to beating ourselves up about our mistakes than we are to moments of self-congratulation. But we should be mighty proud of our role in the world. The United Kingdom of Great Britain and Northern Ireland is one of the Great States of the modern world. An independent Scotland would, I am sure, play its small part too, in human rights campaigns and in the drive for democracy. But it would be just that: a small part. The extraordinary contribution that Great Britain makes to the world, to justice and to humanity itself, would be diminished. Lose a third of your own land mass and your global influence is inevitably diminished. Fail to keep your own people together and what sort of advert is that in an emerging economy for democracy, rights and the rule of law?

(2) Tolerance, Good Governance and Justice at Home

It is not just in the international arena that Britain’s greatness shines: it’s true also at home. To my mind one of the most remarkable instances of this at the moment is staring us all in the face: it is this very independence referendum. UK Prime Ministers since the 1980s and have calmly and authoritatively said that if Scotland votes to leave the Union, then the rest of the country, while it will be sorry to see the Scots go, will not stand in the way. In 2011-12, with the SNP’s extraordinary election victory, this commitment was put to the test. And the UK came through it with honour and dignity. The immediate reaction of the UK Government was that there must be the referendum of which the SNP manifesto had spoken, and that it must be “legal, fair and decisive”. Fearing a prolonged battle in the courts, which would be in no one’s interests but the lawyers’, the UK Government went out of its way to legislate to ensure that the referendum could be lawfully held. What other state would do this: would not only countenance its own peaceable break-up but would act so as to facilitate this? The UK does not want Scotland to leave, but it has none the less acted to enable the Scottish electorate decisively to make the call as to whether Scotland should leave or not. The contrast with Spain, for example, could not be greater. The Spanish will not even allow the Catalans a referendum, never mind accept, as the British have done, that the outcome of the referendum will determine the matter. Even Canada — nice, friendly, liberal, progressive Canada — did not accept before the 1995 Quebec Secession Reference that a Yes vote would necessarily mean that Quebec would leave to become its own state.

Scotland, too, deserves credit for the way the independence debate has been undertaken. There has been no violence. No shot fired. No stone thrown. This should be a mark of pride that we can all share in. I’ve written before of the credit that is due to the SNP for the way they have sought to engineer a modern, civic nationalism in Scotland that (largely) avoids the dangers (and worse) associated with the dark force that is ethnic nationalism. But the truly remarkable thing about this independence referendum campaign is that it is happening at all. A lesser state than Britain — a Spain, for example, or even a Canada — might have sought to avoid it or to cancel it or to deny it any effect. But not the UK. Here we say “bring it on” and we voluntarily give the SNP’s aspirations the force of law. The UK is an extraordinary place: it recognises that the true force of its rule lies not in coercion and command, but in consent and compact. It says to the people of Scotland not “you will obey”, but “we invite you to stay”.

Union: What’s in it for Scotland?

The core of the case for the Union has two strands: trade and jobs; and prosperity and security. Each would be jeopardised or diminished with independence. Each is safeguarded by Union. The Union was born out of this recognition 307 years ago. Scotland needed free trade with her southern neighbour, and England needed security to her north. Whilst the nature of the economic case for the Union, and the nature of the security the Union brings, have each changed over the intervening three hundred years, it is a remarkable feature of the case for the Union that in the early twenty-first century the core of the argument is as it was in the eighteenth. This makes the argument for Union all the stronger, for it is rooted not only in a cool-headed practical assessment of what is in Scotland’s best interests now, but draws also on history. Arguments that cut with the grain of history are always liable to be more powerful than those that seek to cut against it.

(1) Trade and Jobs

Fully 70% of Scottish exports are sold to the rest of the UK. Just pause there for a moment: Scotland trades more with the rest of the UK than with the whole of the rest of the world put together. Scotland’s trade with the rest of the UK is worth four times her trade with the EU. In the last decade the value of Scottish trade with the rest of the UK has increased by 62% (whereas the value of Scottish trade with the EU has increased in the same period by a mere 1%). Given the eye-watering scale to which the Scottish economy depends on doing business with the rest of the UK, why would any sane person wish to erect an international frontier between Scotland and the rest of the UK? Why turn this trade from domestic to international, with all the added costs and disincentives that would apply? A “border effect” would inhibit and diminish Scottish trade considerably. Compare, for example, the US and Canada where, despite commonalities of language, free trade agreements and the relative openness of the border, it remains the case that Canadian Provinces do twenty times as much trade with each other as they do over the border in the US. The border between Canada and the US has been estimated to reduce trade by 40%. Migration within Canada is fully 100 times greater than migration from the US to Canada. Here, it has been estimated that the “border effect” could cost each Scottish household £2000 annually.

There are 360,000 jobs in Scotland created by companies in the rest of the UK. A further 240,000 Scottish jobs depend on exports to the rest of the UK. That’s 600,000 jobs. As many as 200,000 jobs in Scotland depend on the financial services industry. Fully 90% of Scottish companies’ financial services business is with the rest of the UK. Nine out of ten pensions sold from Scotland are to customers in England, and eight out of ten mortgages lent from Scotland are to borrowers in England. This economic activity requires a single domestic market with a single currency in a single regulatory regime.

Scotland’s economy is performing well in the Union. Scotland has a higher economic output per head than Denmark and Finland, and significantly higher than Portugal. And Scotland has maintained a consistently higher employment rate than comparably sized countries in the EU. Indeed, Scotland has the highest employment rate of all the nations of the UK — and there are more people in work in the UK now (30 million) than ever before in our history. We have a higher employment rate even than the USA. Whereas the EU single market is still replete with trade barriers, in the UK our domestic market sees genuinely free trade, meaning that Scots have ten times the job opportunities they would otherwise have. The United Kingdom is the sixth largest economy in the world, despite being only the 22nd biggest country in the world in terms of population. Who wouldn’t want to be part of it? This, it seems to me, is a principal reason why so many school and campus votes have seen large victories for the No campaign. Young Scots have no desire to cut themselves off from the large English markets south of the border. Scots are an aspirational people — and it is Union that gives Scotland a domestic market ten times the size it would be under independence in which Scots can work and trade in order to realise their aspirations.

(2) Prosperity and Security

Trade and jobs are about economic opportunities. But economic Union is also about sharing risks, absorbing shocks, and pooling resources, leading to greater stability and security for us all. Take oil and gas as an example. North Sea oil and gas is a lucrative business, but it is also highly volatile. The oil and gas is expensive even to locate, never mind to extract, and the price of oil can decline sharply. Tax revenues from North Sea oil and gas fell by a whopping £4.5 billion in 2013. That is the size of the Scottish schools budget. That kind of economic shock is much easier to absorb in an economy of 63 million people than it is in one of only 5.3 million people. The UK Government supported the injection of over £45 billion into RBS in 2008, and offered the Bank a further £275 billion of guarantees and state support. This total was more than double the size of Scotland’s economy that year — it was 211% of Scottish GDP including geographical share of North Sea oil. The Union delivers for Scotland economic security, as well as economic success.

The Union is good for Scotland. Public spending in Scotland is £1200 per head higher than the UK average. At the same time, onshore tax receipts are, per person, lower for Scotland than the rest of the UK. In numerous ways, Scotland does disproportionately well out of the Union. In 2012-13, for example, Scottish universities secured more than 13% of the UK’s research council funding: some £257 million. This isn’t just good for Scottish universities: it’s good for Scotland as a whole. It was estimated in 2010 that Scottish universities contributed £6.2 billion to the Scottish economy (not least through the 39,000 people they employ). It is not just in raw economic terms that the Union delivers for Scotland: it delivers also in cultural terms. The UK’s national broadcaster, the BBC, receives some £300 million annually from Scottish licence-fee payers, but makes nearly £4 billion of programming which is free-to-air in Scotland.


“Scotland is not oppressed and we have no need to be liberated.” Not my words, but those of First Minister Alex Salmond in January 2012. He’s absolutely correct, as he was in the same paper when he wrote that “Ours is a lucky nation, blessed with natural resources, bright people and a united society. We have an independent education system, legal system and NHS. They are respected worldwide.” As part of the United Kingdom, Scotland is indeed a “lucky”, “blessed” nation. It can take pride in being part of one of the leading countries of the world. It enjoys all the benefits and privileges that come from the centuries of tolerance and good government that are the hallmarks of Britain’s unrivalled contribution to the world. And in Union with the rest of the United Kingdom, Scotland is free to enjoy not only her own but to share in all of Britain’s wealth and prosperity in harmony and security.