LAST MONTH the campaign group Scottish Business UK set out the costs of independence to the Scottish economy. It didn’t say anything particularly new, except to point out how much more damaging this was than Brexit (eight times worse than the very ‘hardest’ form) by looking at comparable figures. It was something that had been said but not yet quantified in such detail.
If anything, the report erred on the side of caution because most of its findings were based on Scottish Government or SNP figures. The conclusion was that independence today would cost at least fifteen per cent of economic output.
Nationalists have, at one time or another, accepted all of the individual elements of this. The £10bn ‘fiscal gap’ (or Union Dividend) is calculated every year by Scottish Government statisticians. The SNP themselves have estimated the start-up costs of setting up new government departments. The Scottish Government – at the SNP’s behest – has also analysed the economic costs of disruptions to trade. And the SNP’s Growth Commission tacitly admitted that abandoning Sterling would have major implications for the financial sector, borrowing costs and inflation.
In short, Nicola Sturgeon and her team must know (and privately accept) that independence is not economically viable. The situation is much less favourable even than at the time of the 2014 referendum when the fiscal gap had (briefly) been eliminated by the oil price surge.
Yet the nationalists persist in trying to hide the overall picture with specious waffle – the worst of which is the pretence that independence would somehow be a viable alternative to Brexit, when obviously it would make the situation much, much worse. An SNP spokesman called the SBUK figures ‘ludicrous’, itself a ludicrous statement given the origins of the data.
Ms Sturgeon is not an idiot and, one assumes, she is not trying deliberately to cause mass unemployment and tip Scotland into a new depression. Instead, as we witnessed the annual brouhaha of the SNP conference and the various intimidatory marches organised by uber-nats, we must assume that she is stuck in some macabre internal political dance with the blow-hards in her own party who would push to break up the UK whatever the cost.
She faces the perennial conundrum of how to seem enthusiastic about the cause while putting off any new vote indefinitely. This indeed was the approach she and her ministers adopted at the SNP conference. But this is fundamentally dishonest and, in the end, nationalists must surely confront the truth that independence just is not viable in the current circumstances.
The only plausible approach is to answer the hard questions and deal with Scotland’s economic challenges – including closing the ‘fiscal gap’ – within the UK. In other words, to try to grow the economy and take on the inevitable austerity involved while being supported by the monetary framework of Sterling and with full access to the UK single market.
The SNP is taking the opposite approach: its economic policies are resulting in ever-slower growth, an ever-growing ‘fiscal gap’ and, therefore, ever diminishing prospects for independence.
A version of this article appeared in The Times on 9th November