Scottish First Minister Alex Salmond was yesterday forced to admit that an independent Scotland could find itself deeper in debt than the rest of the UK after he had to ditch the oil revenue forecasts on which his plans for independence were based.
The Scottish Government has been under pressure to publish the forecasts for months, and finally released them yesterday on the same day the Treasury released its own figures on Scottish independence, leading to claims that Salmond was trying to bury bad news.
According to the Times, the forecasts show that in the most optimistic scenario, oil revenues would be £7.8 billion in the year of independence, and could be as low as £2.9 billion. Last year Scotland’s finance secretary John Swinney claimed that revenues would be up to £10.7 billion, with the Scottish government’s white paper on independence claiming they would be no lower than £6.8 billion.
This means the five-year outlook has been downgraded by £9 billion, from £48 billion to £39 billion.
The analysis also does not take into account potential problems such as the unplanned shutdowns that have hit North Sea oil rigs in recent years, and assumes that oil prices will not fall.
The forecast also admits that Scotland’s deficit would be 2.8 percent, compared to the UK’s 2.4 percent.
When the figures were released yesterday, however, Mr Salmond spend most of his time criticising the UK Treasury’s report. He claimed that Scots would be £1,000 per year better off under independence, while Chief Secretary to the Treasury Danny Alexander said that Scots would be £1,400 worse off.
Mr Alexander said his figures took into account factors such as declining North Sea oil revenues, Scotland’s aging population, and the costs of setting up a new country.
He called the £1,400 the “Union dividend” and launched his report by saying: “Today we give you 1,400 reasons why we’re better off together.”