A poll conducted by Panelbase for Believe in Scotland of over 2,000 Scottish residents, aged 16+ conducted has shown that 56% of Scottish voters would support Scottish independence if the Scottish Government put a Wellbeing Economic Approach at the heart of its economic plans for an independent Scotland. A plan that recognises that quality of life, equality, fairness, sustainability, happiness, and health are all outcomes that should be given equal weight as it does to traditional measures such as GDP.
The same poll asked the standard Yes/No question on independence, Yes support came in at 48%. This means that a Wellbeing Economic Approach increases independence support to 56% an 8% increase. You can learn more about the Wellbeing economics approach here. This poll demonstrates that there is a route to independence if the Scottish Government is willing to adopt the Wellbeing Economic Approach and drop its outdated Sustainable Growth Commission.
The impact of a Wellbeing Pension on independence support.
Believe in Scotland has also been campaigning for a Wellbeing Pension. The UK basic state pension is the second worst in the developed world and is a direct cause of pensioner poverty. The Wellbeing Pension has been calculated by Scotianomics, the research arm of Business for Scotland, as the minimum amount required by pensioners to live with basic dignity. That amount is £225.00 per week.
When asked “If the Scottish Government’s Wellbeing Economic approach included a commitment to increasing the basic state pension from £141.85 to a Wellbeing Pension of £225.00 per week in an independent Scotland - how would you vote in a Scottish independence independence referendum?” Support for independence skyrockets to 60%. That is a full 12% increase just by clarifying the message and doing the right thing.
The Scottish Independence Congress Supports Wellbeing
When a similar question was asked of delegates at the recent Scottish Independence Congress hosted by Believe in Scotland and attended by 241 delegates selected from 126 local Yes Groups - 97% of delegates agreed that a core focus of Scotland’s campaign to become independent should centre around introducing and pursuing a Wellbeing Economic Approach.
97% also supported the adoption of a Wellbeing Pension as a core manifesto commitment of pro-Yes parties. The message from the Yes movement is clear - they want Scotland to be a country which places the welfare and happiness of its citizens on par with economic prosperity.
Sustainable Growth Commission published in 2017 is now outdated and irrelevant to the new reality. It has been overtaken by events such as the economic damage done by Brexit, the health crises, the cost of living crises and disastrous economic management from the UK Government. There is no place for outdated conservatism in the economic plan for an independent Scotland. The next First Minister of Scotland must continue and in fact, accelerate, the Scottish Governments adoption the Wellbeing Economic Approach in their campaign for independence.
How the Wellbeing Economic Approach changes minds on independence
It is clear that a focus on wellbeing economics increases support for independence, but where is that increase felt? In short, the difference is felt across almost every age group, sex and party affiliation. The commitment to a wellbeing economic approach by the government of a newly independent Scotland increases the support for independence across the board. The most stark demographic jump is among females aged 18-34 where support for independence increases 11% to 75-25 in favour.
The next most interesting change comes from those who intend to vote Labour in the next Westminster election. When asked about their support for independence with the wellbeing commitment, Labour voter support jumps by 11% and LibDem support for independence increases by 12%.
Across all regions of Scotland there are also significant increases in support for Yes. The largest increases are felt in the West and South of Scotland, where opposition to independence is traditionally strongest. In these areas a Wellbeing Economic Approach increases support for independence by 9% and 8% respectively, taking both areas above majority support for independence.
How the addition of the Wellbeing Pension changes minds on independence
Committing to a Wellbeing Pension as part of the Wellbeing Economic Approach increases support for independence even more strongly across the board. The increases across demographics are felt more strongly among females, with the most consequential increase being Females 55+. This demographic was most opposed to independence in 2014, due to fears over pensions, this result shows there is a path to winning them to the cause of independence.
Looking at the results across party lines we can see support for independence once again increases significantly for Labour and LibDem voters. The key here is that the adoption of the Wellbeing Economic Approach with the Wellbeing Pension of £225.00 per week wins over large swathes of Labour voters, these voters are the key to Scotland winning its independence as they are most likely soft No voters or undecideds who voted to remain in the EU and are disheartened by the path the UK is on, if we can show them that an independent Scotland can offer a brighter future, we can win them over.
These results show that a key way to increase support for independence is to offer a vision of a fairer, more equal and happier nation that prioritises more than just economic growth but also the happiness for its citizens.
Believe in Scotland and its parent organisation Business for Scotland have, since 2011, championed the introduction of wellbeing economics as the dominant economic model of an independent Scotland. The current and past failures of the UK Government highlight, even more starkly, that now is the time to move to this model. The old economic and political dogmas of the left and right are dead, they offer us no solutions to the current state of the UK. The world economy has teetered on the brink of collapse twice in just over a decade, with the UK economy never fully recovering from the first. We need new answers and wellbeing economics provides them.
Wellbeing economics provides answers to the big questions, such as how do we combat climate change, reduce inequality, improve health outcomes and quality of life? The solution is simple: we must give these outcomes the equal weight we currently give to traditional economic indicators such as GDP growth or trade statistics, incorporating them into official government publications and policies. Scotland’s aim should be to become a world leader in all the areas listed above by building a strong society and a strong economy - as one cannot exist without the other.
Through independence, Scotland can make strides to become a world leader in the other wellbeing indicators and the results of this poll shows that the Scottish people want that future. One where their quality of life and happiness is prioritised as much as economic growth.
A poverty gap is opening between England and Scotland, in particular in child poverty rates, according to a new report by the Joseph Rowntree Foundation. In its annual report: “UK Poverty 2023: The essential guide to understanding poverty in the UK”, the charity reports that rates of child poverty are diverging between the two countries.
The report found that Scotland has a lower rate of overall poverty (18 percent) than England (22 percent) and Wales (24 percent), partly because of lower housing costs. Scotland has seen the largest fall in poverty of any area in the UK - six percentage points below where it was 20 years ago. The report praised the Scottish Government’s move to limit rent increases, and the Scottish Child Payment scheme, whereby poorer households receive £25 a week for each child under 16.
Child poverty rate in Scotland comparable to the south of England
Child poverty in Scotland is amongst the lowest in the UK, at a similar level to the south of England, the report says. Across other areas of the UK, hard-won reductions in child poverty are “unravelling”, with child poverty in North East England up 12%.
The report said: “Divergence in policy across nations will probably drive greater disparity in poverty rates. Scotland has taken decisive action in defining child poverty targets in legislation and enhancing the benefits system with a Scottish child payment for those receiving qualifying benefits; this was introduced in February 2021 at £10 a week per child under the age of six; the value doubled in April 2022 to £20 a child and increased again in November 2022 to £25 when it was also rolled out to all eligible children under 16. In response to both the pandemic and cost of living crisis, both Scotland and Northern Ireland have taken steps to limit rent increases for social renters, while the Scottish Government is introducing more protections for private renters including greater rent controls and eviction bans.”
The Council Tax Reduction scheme is also unique to Scotland and helps people on low incomes save an average of £750 a year on their council tax bill. Those eligible can also save up to 35 percent on their water and waste charges.
The “rape clause” is driving more and more children into poverty in England
The Scottish Government mitigates the UK Government’s ‘rape clause’ which says that a low-income family can only get benefits for two children - unless they can prove that a subsequent child was the result of rape. The Scottish Government spends over £1.4 billion each year to mitigate this and other UK welfare benefit cuts.
The JRT report does not provide separate numbers for large-family poverty in Scotland and England. But it said that almost half of children in large families in the UK are now in poverty, up from 33% a decade ago. The JRT says that this two-child limit is increasingly important in driving up rates of child poverty in larger families.
The report said: “The latest data still does not show the full effect of the two-child limit policy, which explicitly targets larger families. This has withdrawn means-tested support from third and subsequent children born since April 2017. In the latest data, more than half of families containing three or more children have their youngest child born before this date so are unaffected by the benefits cap. As time goes on, more and more families will be affected by this and poverty rates in larger families are therefore likely to increase further.”
Poverty still a huge and growing issue - as Brexit shrinks the UK economy
Although it is worse in England, poverty is a serious and growing issue for too many families across Scotland. Brexit is turning the UK into the sick man of Europe and the economy is shrinking. An independent Scotland back in the EU could emulate Ireland’s growth rate - it grew more than 12% in 2022, compared to 4% for the UK - and fund better pensions and measures to support families.
The cost of energy bills in Scotland is also in part due to the UK Government's ideological decisions over how to tax oil and gas and their choices over privatisation of important infrastructure such as the national power grid. The JRT research doesn't yet reveal the effect of the energy crisis on low-income Scots - currently paying the highest bills in the UK despite living in an energy-rich country.
Conclusion - an independent Scotland could do better
This report shows the result of the political and ideological choices of a UK Government that Scotland didn’t vote for. A cruel policy to limit benefits to two children in a family forces many into deep poverty. The Scottish Government has to spend too much of its fixed budget on mitigating these choices.
An independent Scotland back in Europe and with full control of its huge energy resources would have much more power to change the current political landscape and emulate other small European countries where relative poverty is much lower.
When Shell announced the biggest profits in its history - £32.2 billion pounds for 2022 on Thursday - the BBC morning news flagship, the ‘Today’ programme gave listeners misleading information about how much tax it is paying in the UK compared to other countries.
The show’s journalists gave the erroneous impression that the UK is getting a similar amount of tax from Shell as elsewhere - but in fact, because of the UK’s tax regime, Shell made no ‘taxable profit’ in the UK in the first three quarters of the year 2022 and paid no windfall tax at all. It may pay a small amount of windfall tax to the UK for the last quarter but the figure is so far unclear.
Shell produces about 120,000 barrels of oil a day equivalent from the UK continental shelf, 90% of which is in Scottish waters - but it makes no taxable profit on that.
FT energy correspondent David Sheppard wrote: “A windfall tax that raises a big fat doughnut from one of the UK’s largest oil and gas producers at a time of record prices is, by its very definition, imperfect, even if Shell has indicated it expects to start paying tax in the UK... A system that taxed oil and gas production first rather than zeroing in on profits would ensure the government’s take from the exploitation of an irreplaceable natural resource was never zero.”
Robinson: “It’s a little bit higher in other countries” - hmm, no - it is SO much higher in other countries!
Presenter Nick Robinson said: “There is a lot of tax being paid by these companies already. Shell is paying 75% of its UK-based profits in tax - it is a little bit higher in other countries but not much. We are talking of companies that are paying a lot more in corporate taxes than most.”
Robinson did not mention that Shell, which moved its HQ from the Netherlands to London a year ago, has made no taxable profit in the UK since 2017. In contrast, Shell paid £3.7 billion to the Norwegian state in 2021 for example, far more than it paid in the UK. where since 2016, its subsidies have outweighed the tax it has paid.
Shell also distributed $26bn to shareholders in 2022 including $18bn in share buybacks. Tax expert Dan Neidle argues that it would be appropriate for the UK to levy a one-off tax on Shell’s UK-based global HQ. “Shell is crying out to be taxed more,” he told the Financial Times.
“It’s not easy to design a windfall tax”, Today’s business apologist - sorry, business editor - explained
Business editor Simon Jack implied that Shell should be allowed to keep its massive profits - the highest a UK headquartered company has ever made - because it “got no subsidy” when oil prices fell.
Simon Jack told listeners: “It’s not easy to design a windfall tax. Its not the highest in the world - its higher in Nigeria and Norway but it’s one of the highest in the world, and just a reminder that Shell makes 95% of its money and that is taxed elsewhere in the world not here in the UK"
Robinson asked Jack: “How do governments deal with these record energy profits which may be just short term?”
Jack said: “It's very volatile prices. For example, when the price of oil collapsed, Shell will say ‘No-one offered to subsidise our losses when we lost billions in those years so this is the flipside of that’. There is obvious outrage at these numbers, but, like I say, designing a windfall tax is not straightforward for a UK-domiciled company which makes 95% of its money elsewhere in the world and is taxed elsewhere in the world."
Not true - since the oil tax regime changed, Shell has benefited from taxpayer support!
If you look at GERS, the account of Scotland’s finances, you can see a change coming through after 2015/16, when the UK government started to tax the sector differently. The effect of the UK’s tax changes were that many private companies and their shareholders became net recipients of taxpayers’ money.
This was ostensibly done to increase investment and to protect jobs as the oil price fell – but Aberdeen was hit harder than Norway, which continued to tax energy firms at its usual high rate. Rebates were not specifically linked to any commitment to save jobs. In 2016 Shell, having benefitted from tax rebates from the UK Government and having made many thousands of workers redundant, went on to declare the world’s largest shareholder profit dividend that year.
Could there be a political reason for under-taxing oil production from Scotland?
The UK Government now takes much more tax on oil and gas at the pump or when heating oil is purchased. In 2022-23, fuel duties are expected to raise £25 billion. Very little of that is credited to Scotland’s accounts.
Some suspect that one reason for changing the North Sea tax regime is to lend weight to the Unionist argument that Scotland is too poor to become independent.
Energy taxation is reserved to Westminster
Shell is not doing anything illegal - it is the UK government's political and ideological choice to give Shell tax rebates and subsidies. This is reserved to the UK government - the Scottish Parliament has no say on it.
Westminster gives tax rebates to large oil companies to cover the cost of decommissioning rigs and fields and to explore for new oil fields. These tax deductions include an effective subsidy for any fossil fuel production - but not for green investment. Writing in the Financial Times, Professor Michael Devereux at the Oxford University Centre for Business Taxation argues this has, in effect, created a subsidy for fossil fuel projects that otherwise would not go ahead.
Conclusion - BBC flagship news show sounds like propaganda
The BBC has come in for criticism recently for being too close to the Conservative Party, and to the world of big business. It has lost the trust of many in Scotland, where 1 in 7 people no longer pay the licence fee. Today’s misleading reporting of Shell’s historic profits, which in the UK came from exploiting Scotland’s energy resources, will do little to rebuild trust.
Would an independent Scotland have to use the euro? The answer is “No”. Nicola Sturgeon was correct when she told Douglas Ross this today - but that doesn’t prevent Scotland’s Unionist politicians and media doing their best to spread confusion.
The Times headline today was “Join the euro or your EU dream dies, Sturgeon told”. It is technically correct that Scotland will have to pledge to being open to joining the eurozone. But Scotland will control the timeline on that. It may not decide to join for decades.
Yes, Scotland would have to pledge to being open to join the euro at some point in the future. It could take 15 years, like Bulgaria which is adopting the Euro in 2024, or much longer. Sweden, Denmark, the Czech Republic and Poland have no current plans to switch.
So, if the question is worded:
“Would an independent Scotland joining the EU as a full member using the process for joining as a new member have to commit to using the Euro at some undefined point in the future?” Then the answer is yes.
But whether or not to join the Euro and the timing of that will be a matter for future governments. It will be a matter for debate after Scotland has: achieved a referendum, voted for independence, established a central bank, a Scottish currency and rejoined the EU. It’s a way down the road.
Scotland’s currency future will be Scotland’s choice
Last week’s Scottish Government report “Building a Stronger Economy” includes a section discussing comparable European countries’ currency choices. It says:
“Austria, Belgium, Ireland, Finland and the Netherlands share a currency – the euro – while Denmark, Iceland, Norway, Sweden and Switzerland have their own currencies. However, Denmark pegs its currency to the euro (meaning that it shared a fixed exchange rate with the euro) and shares it with Greenland and the Faroe Islands. The decision to peg to the euro is a policy choice: Denmark’s main trading market is the European Union, so pegging provides price stability for trade.
“All of those countries, regardless of currency choice, have higher national incomes per head than the UK.”
The best way to explain the euro position is to quote the European Union itself:
EU advice: Are the Member States obliged to join the euro?
"In principle, all Member States that do not have an opt-out clause (i.e. Denmark) have committed to adopting the euro once they fulfill the necessary conditions. However, it is up to individual countries to calibrate their path towards the euro and no timetable is prescribed."
The Member States that joined the EU in 2004, 2007 and 2013, after the euro was launched, did not meet the conditions for entry to the Euro area at the time of their accession. Therefore, their Treaties of Accession allow them time to make the necessary adjustments.
So it is clear that:
- To use the euro you have to meet the necessary conditions set by the EU and Scotland would not do so immediately on independence
- Scotland would be empowered by the EU to decide the timetable to meet the conditions and as quoted, no timetable is prescribed – in other words, we could be on an indefinite path to adoption.
- Some EU nations were told on joining that they did not yet qualify to use the euro.
Other EU members that are not using the Euro
- Croatia joined the EU in 2013 – On January 1, 2023, Croatia will become the 20th country to use the euro, ten years after becoming a member. It will join Schengen the same day.
- Bulgaria joined the EU in 2007 – Bulgaria’s coalition government plans to switch in 2024, 15 years after becoming a member
- The Czech Republic joined the EU in 2004 – it has no plans to join the euro
- Denmark joined the EU in 1973 – the Danish Government has fixed its currency to the euro. It shares its currency with Greenland and the Faroes
- Hungary joined the EU in 2004 – Its semi-dictator leader Victor Orban has many issues with the EU - but the country is currently exploring joining the euro waiting room (ERM) as a way to stabilise their fluctuating currency.
- Poland joined the EU in 2004 – whether or not to join the euro is a subject of lively political debate. The country is unlikely to join any time soon.
- Romania joined the EU in 2007 – their target year to join the euro is 2024 - but they won’t be allowed to if they don’t meet the criteria.
- Sweden joined the EU in 1995 – Sweden held a referendum in the early 2000s on euro membership, and the country rejected it. Sweden is obliged by treaty to join, as are other newer members but they have just said no. Swedes have a positive view of the EU; but most still don’t want to join the euro.
When an independent Scotland joins the EU as a full member state the EU will agree that it is not possible for Scotland to adopt the euro immediately and will give the Scottish Government full control over the timescales to meet the criteria.
The Scottish Government would therefore be able to indefinitely postpone joining the euro. However, it is technically possible (however unlikely) a future Scottish Government might decide to join the Euro voluntarily - the point is that such decisions are able to be made by a sovereign independent country. As the report “Building a Stronger Economy” points out, even now, far more of Scotland’s manufactured exports go to the Eurozone than to the UK.
These issues will no doubt produce political debate in the decades after Scotland has achieved its independence from the failing UK.
Scotland is at a crossroads - should it remain as a region of a stagnant, Brexit-bound UK economy - or step out confidently into an independent future? Last week the Scottish government published a report on how an independent Scotland can build a strong economy, one that is fairer, greener, stronger and considers the wellbeing of the nation as well as its economic growth potential. The report itself was barely covered by the Unionist media - who confined themselves to reporting on the press launch and trotting out the usual attack lines. However, it has been well received by those who have actually read it.
The report looks at how Scotland is performing at the moment; where are the barriers to growth and offers a road map for an independent future. Scotland starts from a position behind that of the UK - it has a lot of undeveloped potential; rejoining the EU will be a huge boost; and an independent Scotland can make the most of its natural and human resources.
Here are some of the ways Scotland can build a better economic future for all. (Unless otherwise linked, facts and figures are drawn from the report.)
1 Scotland’s economy is on an upward trajectory compared with the UK
When the Scottish Parliament was reconvened in 1999, Scotland’s economy was lagging behind England’s. Wages were lower, the productivity of Scottish workers was far below that of English workers, and there were few opportunities. In those days, the public sector was the biggest employer.
Now, the biggest employer is business services and finance, at almost 30%. Scotland is the only part of the UK where productivity is increasing significantly. While productivity has barely changed in the UK, Scotland has gone from being 8% behind to just 2% behind. Average wages are also rising at a faster rate in Scotland and have come from a lower base to equal the UK average. Scotland is now one of the wealthiest parts of the UK, with the highest GDP per capita of any of the UK’s nations or regions, outside London and the South East.
Devolution has helped Scotland but there is still a long way to go. Westminster still controls most of the economic levers, and imposes policies that don't work for Scotland. Scotland and the UK are now falling behind EU countries in terms of average income, income inequality and the situation of the poorest in society. An independent Scotland could regain some of the ground lost since Brexit by focusing on a well-being socio-economic approach.
2 Scotland already leads the UK in terms of green jobs and growth
The Green Growth Index by Oxford Economics, commissioned by the Lloyds Banking Group, places Scotland first in the UK for green economy opportunities. This reflects Scotland’s existing green industrial base with a growing number of green jobs and innovation activity, access to skills and training, and development of the renewable energy infrastructure.
With independence, Scotland could make longer-term planning and investment decisions - ones that are no longer dependent on the ‘Barnett consequentials’ of ever-changing policies made by Westminster governments Scotland didn’t elect.
3 Vibrant sectors include life sciences, space, and gaming
The professional, scientific, and technical activities sector is now the largest sector in Scotland in terms of the number of businesses, and is growing 1.5 times faster than the economy overall.
Scotland has one of the biggest life sciences clusters in Europe with world-leading expertise in drug discovery, medical technologies and agri-tech. Almost 20% of all UK jobs in the space sector are based in Scotland. Scotland currently produces more small satellites than any other country in Europe. Another strong area is gaming, centred on the Dundee video games cluster. These sectors are all international - they will benefit from Scotland rejoining the EU and the return of free movement.
4 Scotland’s population is the most highly educated in Europe
Scotland has a higher share of the population aged 25 to 64 years with a tertiary (degree level) education than any country in the EU. It stands 8 places higher than the UK in the table, reflecting a broad education, and greater equality of access than in the rest of the UK. The University sector will benefit from rejoining Erasmus which used to see thousands of Scots study abroad each year; and from rejoining Horizon, the world’s biggest science fund.
5 Independent Scotland will be in a stronger economic position than as part of UK
The current assessment of Scotland’s financial position is called ‘GERS”. Unionists often say that it shows a deficit. About £75 billion in raised in total from tax in Scotland; and roughly £56 billion of that comes back to Holyrood. Westminster says it spends the remaining £19 billion, plus another £20bn or so, on Scotland’s behalf, on things like welfare, defence, and servicing the national debt, leaving a nominal ‘deficit’ of £20 billion.
But this sum reflects the fact that the UK government controls policy and regulation. So for example, the UK chooses to tax oil and gas lightly at source - but to take in a lot of revenue at the petrol pump (£26bn), which is almost all tax raised in England. The pattern is repeated with other assets like whisky and renewable electricity. Under independence, Scotland will control tax policy and can ensure it works to Scotland’s advantage rather than Westminster’s.
6 Rejoining the EU will deliver massive benefits to trade
The economic opportunities for Scotland of re-joining the EU as a member state in her own right for the first time are potentially enormous. The EU is the largest single market in the world. The most recent available data, for 2019, shows that the value of Scotland’s manufactured goods exports to the EU and the rest of the world was £19 billion - almost double the value of exports to the rest of the United Kingdom - £11 billion.
If Scotland can increase export levels to the same as other comparable high-performing countries, that will deliver a boost to prosperity and tax revenues. The top target countries for increasing exports are almost all within the European single market.
7 independent Scotland will control immigration
Scotland's immigration needs are different from England’s. Scotland has an older population, particularly in the Highlands and Islands. In the Western Isles, the average age will soon reach 50, and the rest of the Highlands is not far behind. Scotland’s average age is 42. The shortage of younger workers is impacting the economy - there is just not the pool of people available that are needed by local businesses, health and social care and so on.
Scotland’s population at the time of the Union in 1707, was about one-fifth of England and Wales’s. But today the figure is about one-twelfth of the overall UK population. Free movement will increase the pool of workers. Independent Scotland will also be able to set its own figures for things like the salary levels needed for a visa, the number and cost of agricultural visas, student work visas, and so on, at an appropriate level for Scotland’s needs.
8 Independent Scotland will have one of the largest marine zones in Europe
As an independent member state of the EU, Scotland’s marine zone would be the fourth largest of EU member states’ core waters; larger, for example, than those of Ireland, France or Portugal. These waters are not only significant geographically, but are also among the richest in the world in terms of fisheries, marine biodiversity, and offshore renewable energy potential.
9 Independent Scotland can make the most of vast renewable potential
Scotland’s renewable energy potential is vast. In 2021, Scotland generated enough renewable electricity to power all households in Scotland for three years, and exported electricity with an estimated wholesale market value of £2.4 billion. And in the coming decades the potential to create and export energy from onshore, and offshore wind, hydrogen, carbon capture, solar, pumped hydro is enormous.
Currently, the UK government and the privatised National Grid decide how energy is regulated, paid for and taxed. An independent Scotland could ensure the long-term affordability of electricity, as its offshore and onshore wind farms provide electricity at a lower cost than nuclear or gas power plants, which the UK relies on.
10 Independent Scotland will set up a £20 billion investment fund
The report from the Scottish government sets out plans to take oil and gas and other windfall income out of day-to-day spending and instead invest it “for the long-term benefit of the Scottish people.”
The aims of the “Building a New Scotland Fund” would be to enable the transition to net zero - it will be used, for example, to fund investment in insulating existing homes and to build new ones that are easier to heat.
Scotland has so many reasons to benefit from independence. Scotland’s constitutional choice has become much starker than it was in 2014. To stick with a chaotic, Brexit-bound, increasingly unequal UK suffering from a collapse in political governance and international credibility? Or set out on the path towards becoming more prosperous, sustainable and fairer, like most comparable European countries?
We think most Scots will choose the latter.
Read “A Stronger Economy with Independence” report
WE have all become accustomed to Boris Johnson’s false “bumbling” manner in public appearances and interviews as he tries not to cement his place in history as the PM who made Britain the laughing stock of the world after “getting Brexit done”. However, his and the Chancellor’s woefully inadequate handling of the economy, which has been battered by the pandemic, catastrophic events in Ukraine and spiralling energy prices, are in danger of leaving the UK stuck with the tag, “the poor man of Europe”.
Inflation in the UK is currently as 6.1 per cent, with the Bank of England expecting it to top 8 per cent and the Office for Budget Responsibility (OBR) forecasting an 8.7 per cent rise in the third quarter of this year, a 40-year high.
But how much of the cost of living crisis has been caused by corporate greed, and could that unflattering soubriquet have been avoided had the Tories acted with some humility instead of keeping their big money backers onside?
Price hikes on basics are not confined to the UK. Worldwide oil and gas prices have been rising since the economy began to recover from its first bout of Covid in late 2020 – when the collapse in demand drove prices down. However, when Russia invaded Ukraine, prices shot up to unprecedented levels hitting the whole of Western Europe.
In the UK – which imports only 8% of its fuel products from Russia – around 22 million homes were facing energy prices rises of £700 per year from the beginning of this month, when the energy price cap rocketed by 54 per cent.
Rishi Sunak did announce a temporary 5p per litre reduction in the duty on petrol and diesel, down from 57.95 per litre; and a cut in income tax in two years’ time, prompting widespread criticism, including from the Resolution Foundation, which said only one in eight workers would see their tax bill fall.
The impending financial crisis has promoted hundreds of thousands of words of comment and many guides on how people can cope, so how are the governments of our European neighbours helping their populations?
In France, the government cut the cost of fuel by 15 cents a litre and gave six million households a €100 (£83.50) energy voucher to cope with soaring costs. Compare that to the £200 loan being given to UK households, which will be paid back in instalments on future bills
All taxpayers in Germany are being given a €300 (£250) payment to help with their cost of living rises, with a further €100 (£83.50) for each child and a similar amount for anyone on state benefits. A three-month public transport ticket has been slashed to €9 (£7.50) to encourage people to use low-carbon travel.
The Irish government is giving every household a €200 (£167) energy rebate and public transport fares have been cut by a fifth until the end of the year to help people with rising travel costs.
In Northern Ireland, public transport fares have been frozen, while in the UK, rail fares rose by 3.8 per cent at the beginning of last month.
Spain has seen inflation rise to almost 10 per cent, but the government has still tried to ease the burden on its citizens. It is subsidising fuel by 20 cents until the end of June and pledging to tax excess profits. It has also capped rent rises at 2 per cent.
Sunak’s spring statement came nowhere close to helping lower income households, and the Institute for Public Policy Research said they still faced an average cash shortfall of £320 this year. The IPPR said his statement was biased towards higher earners – who, it estimated, received four times the support that lower-income households did.
Oil giants have reaped huge benefits from the pandemic and the Ukraine crisis – Shell’s and BP’s combined profits last year totalled $32bn (£24.5bn), triggering calls for a windfall tax to be levied.
Following the privatisation of our utility and transport companies, started by Maggie Thatcher, we have seen them make billions in profits as they push up the prices of energy, water and other commodities. The National Grid, for instance, pays out more than £1bn a year to its shareholders.
Pharma giant GSK, with sites at Irvine and Montrose, has been embroiled in a dispute with the Unite union over a pay offer of 2.75 per cent, while its chief executive Emma Walmsley, received a 17 per cent rise last year, taking her remuneration to over £8 million – prompting claims of “cast-iron corporate greed”.
If an entrepreneur becomes a millionaire, that's great, they took the risks, founded a business and created jobs. Large corporate salaries involve no real risk, as the economy has been restructured to ensure their success and often that they don’t even have to pay taxes.
There’s no getting away from such examples of apparent avarice and, despite the fact that similar claims are much more prevalent in the US, they deserve to be addressed in public on these shores.
But Johnson and Sunak etc are unwilling to do anything to upset their super-rich friends, family members and supporters. This leaves us with two key questions firstly, when exactly does the UK qualify as an oligarchy? And secondly, if Scotland can produce 100% of its energy requirements from renewables in 2022, which is the cheapest form of energy, when will people realise that the cost of living crisis is not only a cost of greed crisis but a cost of remaining in the UK crisis.
The UK Government announced a new energy strategy this week. This concentrates investment in nuclear power. Scots householders will have to pay for that - but Scotland doesn’t need it. The country has more than enough renewables for all its electricity needs and more.
Instead, Scotland urgently needs a transformation of the UK's electricity transmission system which does not serve Scotland's needs. It also needs more investment in energy efficiency and demand reduction
Here are the three key reasons Westminsters energy strategy doesn't work for Scotland.
1 The UK’s privatised national grid system does not serve Scotland well
National Grid Transco PLC is a London-based company that operates in the UK and US. It is enormously profitable. It employees 12,000 people worldwide and made £15 billion in revenue last year. It recently sold a majority stake in the UK's gas transmission and metering business for £2 billion to a consortium led by Macquarie Group. National Grid said this move was part of its transition to low-carbon and that it would:
"Enable National Grid to maintain a strong balance sheet with its strong investment grade credit rating, supporting its sustainable dividend policy".
Last week, the UK Government announced plans to buy back the part of National Grid Transco PLC that oversees the UK’s electricity systems which it also builds and operates. The Government is not disclosing how much it is paying for this partial renationalisation, which attracted little news coverage.
National Grid Transco PLC owns and manages the grid infrastructure in England and Wales. It also manages the transmission system in Scotland - although the ownership lies with Scottish Power and SSE, a situation which appears to make investment in the Scottish grid less attractive. Scottish energy companies are charged ten times what English companies have to pay to connect to the grid.
Shortly after the Scottish Government licensed a huge amount of offshore wind earlier this year, National Grid said it had no plans to connect most of this to the grid for at least a decade.
SEC’s energy briefing reported:
“The recent ScotWind auction of 25GW of Scottish offshore wind potential - enough wind energy to power the equivalent of 23 million homes per year - demonstrates the risk (from the grid). Within weeks of the auction being announced, National Grid/ESO declared it did not plan to connect more than 10GW of the successful projects. This left billions of pounds of investment and clean energy potential hanging in the wind.”
National Grid also makes profit from building and managing connectors that link the UK network to Europe. The way the UK mitigates against demand surges or supply shortfalls is to buy electricity at the spot price on the open market.
SSE commissioned independent research which found storing renewable energy in hydro facilities for when it is needed, could save UK bill-payers £690 million a year by 2050. But, like the other facilities that have been granted planning permission by the Scottish Government, it is unlikely to be built because of the lack of a market framework. SSE stated:
“The study, by Imperial’s researchers, found that 75% of the savings to the energy system from projects like Coire Glas would be from the avoided capital expenditure in higher cost electricity generation technologies that would otherwise be needed to meet the UK’s target of carbon neutrality by 2050 whilst meeting security of supply. “Importantly, the report highlighted that despite all of the benefits which new pumped hydro storage projects would bring, the current policy and market framework is unlikely to bring forward investment in many new projects because the long duration and low carbon capability of pumped hydro storage is not sufficiently valued.”
2 The strategy pours billions into nuclear power - while making unrealistic claims about what that will achieve.
The money that is invested in nuclear will come from energy consumers. It is predicted that consumers across the UK including Scotland will have to shell out £80 a year through their bills for this. The strategy document says the UK has: “committed to provide up to £1.7 billion of direct government funding to enable one nuclear project to FID (final investment decision) this Parliament.” It proposes up to 8 new nuclear reactors - which will cost a total of £13 billion.
Unlike renewables, the cost of nuclear power is rising. When completed, Hinkley Point C will be one of the most expensive power stations in the world. The fuel it generates will cost £90 per MWh. The UK’s existing nuclear power costs £45 per MWh.
Writing in Advanced Science News recently, global expert Professor MV Ramanda wrote: “Although often blamed on public opposition, especially resulting from the devastating accidents at Chernobyl and Fukushima, the main cause for the drop in nuclear power’s importance has been the steadily rising cost of nuclear reactors and the almost invariable tendency for project construction costs and time to escalate dramatically.”
The UK Government also plans to invest £120 million on smaller reactors. Professor Ramana wrote:
“Private industry is not going to take the risk of paying for production lines and buying large numbers of reactors that could well prove uneconomic. So, it will be public money, as it nearly always has been the case with nuclear power, that will be risked.”
The UK Gov strategy, however, ignores current science and harks back to a 1950s vision of nuclear power. However, It does not mention that in 1957, a fire at Windscale nuclear plant spread radioactive material throughout Europe. The UK Government still spends £3 billion a year keeping this site, now known as Sellafield, safe.
3 There is no well-funded commitment to improving energy efficiency and insulating homes in the strategy
A large-scale energy efficiently drive would benefit consumers struggling with energy and cost of living crises. But instead of new measures, the strategy repackages existing schemes. It also relies on householders borrowing money to insulate their homes.
The strategy voices the UK Government's faith in the free market:
“This is not being imposed on people and is a gradual transition following the grain of behaviour. The British people are no-nonsense pragmatists who can make decisions based on the information.”
The SEC Energy Strategy Briefing concluded:
“The UK’s net-zero 2050 target as already looking under pressure. Without more incentives to consumers and business to reduce demand for energy…that target looks further away than ever.”
Like the UK, Scotland has some of the least energy-efficient homes in Europe. Much of rural Scotland doesn’t have access to the gas network - and electricity is priced in a way that makes their bills far higher than the average. They also have to pay higher standing charges than most of England.
Scotland does not share the UK Government’s nuclear vision. But Scots will still have to pay for it - and the Scottish Government is deprived of the decision-making power to invest in the energy priorities that the Scottish people choose. In short, energy bills will be cheaper in an independent Scotland and the energy sector far more environmentally friendly.
Michael Glackin in the Sunday Times says the Russian invasion of Ukraine has changed UK energy security. The answer, he says, is to drill for more oil and gas, frack and build nuclear power plants.
He’s palpably excited about Boris’ new ‘energy supply strategy’ but when have the Conservatives ever come up with a strategy that benefited Scotland and not the City of London? Successive Westminster Governments of both colours have been reckless with the nation’s energy resources, having sold them off to the highest bidder decades ago to enrich private corporations and shareholders, and is the reason the UK has no energy security today. And the oil and gas the UK Government privatised belonged to Scotland, as does the vast majority of this island’s offshore wind, wave and tidal potential. Nations like France and Norway were wiser, keeping control of their strategic energy resources so that today their governments are able to shield their citizens from the obscene profiteering by oil and gas companies, many of whom offshore their profits to avoid paying the full amount of tax owed on their operations here.
Will Boris’ ‘energy supply strategy’ reinstate oil taxes the UK Government cut to zero in 2015, foregoing tens of billions in revenue and making the UK the most profitable place not only for Russian oligarchs to launder their money but also for Big Oil to operate? Doubtful. And you can forget fracking if you care at all for the environment. The US has discovered to its cost that fracking causes earthquakes and contaminates groundwater.
As for nuclear power, not only does Scotland not need it but also there are two big problems. There is no way to safely dispose of toxic nuclear waste. MPs have warned that the UK is storing an “extraordinary accumulation” of this hazardous waste in “outdated facilities” that will cost £70 billion to clean up. So it is a deal breaker, Mr. Glackin. Nuclear power is also uneconomic. A recent German study of nuclear power plants constructed around the world since 1951 found the average plant made a loss of 4.8 billion Euros. Small modular reactors (SMRs) like the ones Rolls Royce is pushing, won’t save the day. There’s just one SMR operating and it’s in Russia. The two SMRs in Wales and Cumbria have been mothballed. Because nuclear power is so expensive, not even private companies are willing to stick their necks out to finance these plants. That’s why the UK Government is forcing consumers to pay for the upfront costs of nuclear power plants with its Nuclear Energy Financing Bill. The number of politicians with commercial ties to the nuclear power industry may also explain the UK’s eagerness to have consumers bankroll this dangerous energy source.
Renewables are by far the cheapest, most abundant and cleanest source of energy. Even before the war in Ukraine, global oil and gas prices were higher than renewables and the price of wind, tidal and wave power hasn’t changed. Renewables generate nearly 100% of Scotland’s electricity and there’s capacity to develop far more, which England is going to need. Renewables projects can be developed quickly and are six times cheaper than gas generation. Yet the UK’s privatised Ofgem has stymied new renewables projects by its absurd charging regime whereby Scottish generators pay £7.36/MWh to connect to the grid but their English and Welsh counterparts pay just £0.49, and generators in southern England get a subsidy!
There’s also the small matter of cataclysmic climate change. Last month’s IPPC report excoriated the world’s governments for acting in a fragmented and incremental manner when transformational changes are needed to safeguard human wellbeing. If we fail to reduce emissions, the Ukrainian refugee crisis will be dwarfed by the exodus of people around the globe desperate to escape rising sea levels, devastating heat waves, wildfires, lack of food and water, illness and trauma from natural disasters. Increasing oil and gas production will only accelerate humanity’s suicide.
The facts are, Mr. Glackin, that Scotland doesn’t need a UK energy strategy that subsidises Big Oil and nuclear power. What Scotland needs is to restore its independence so it can forge its own energy strategy and provide its citizens with security, safety, affordability, jobs and a more sustainable and hopeful future.
Guy Stenhouse, writing in one of the Herald's regular, 'talking Scotland down' columns, that they gift to unionist campaigners, appears to have only a passing acquaintance with movies or the facts. He uses the analogy about wheels coming off the nationalist bus just as they did in the movie the 'Italian Job' - I can categorically tell you that the bus in the aforesaid movie didn't lose any wheels nor has the Yes movement. However, let’s humour him with his wheels off the bus analogy and point out where he is wrong.
Wheel one, pensions. Scotland more than pays its way. Once independent, it will keep all the tax and national insurance revenues, not send them to Westminster, and since life expectancy is lower, Scotland could raise the state pension at no additional cost. But Scotland shouldn’t advertise this since it may precipitate a flood of people coming north to escape one of the lowest basic state pensions in the developed world.
Wheel two, currency. SNP policy is to adopt a Scottish currency as soon as practicable after independence. Currency has no intrinsic value but derives value from the goods and services an economy produces. Scotland’s immense natural wealth, highly developed economy and educated and innovative people will guarantee our currency has value. Scotland will launch its own currency at the point it becomes advantageous to Scotland to have one, there will be a transition period and using Sterling (our own currency) for a short period would maintain pensions values and facilitate trade as Scotland becomes independent. A sensible, desirable and pragmatic approach.
Wheel three, the deficit. Under the terms of the devolution settlement, the Scottish Government must balance its budget every year. London assigns Scotland a deficit based on the supposed benefits we receive from being part of the UK and for billions spent on nuclear weapons, foreign wars, unemployment payments because of UK economic mismanagement, Westminster corruption, servicing a UK debt Scotland didn’t generate, expenditure on Brexit and negotiating foreign treaties that damage Scotland’s economic interests. Some of the UK's spending on Scotland's behalf is spent in Scotland but what deficit Scotland has will change dramatically once we remove the added costs of UK membership and start investing in Scotland's wellbeing.
Wheel four, the EU, not English, Single Market. ONS figures show the UK’s economic recovery has lagged that of its EU counterparts and UK exports to the EU plummeted by £20 billion in 2021 compared to 2018. As for that vaunted EU rebate, there is no £350m extra per week for the NHS. Regressive National Insurance taxes are rising, the triple lock on pensions is gone, and food and energy prices are soaring. Meanwhile, the newly minted Minister for Brexit Opportunities, Rees-Mogg, is desperately scrabbling around amongst Sun readers for ideas on how to turn this sow’s ear into a silk purse.
Scotland will be back in the Single Market as soon as we exit this failing Union and like Ireland, will rapidly forge new trade links with the EU, leaving behind an isolated rUK that will sorely need Scottish energy, water, and food and drink.
The wheels have been off the UK bus for some time now. The founding director of the Fraser of Allander Institute, David Simpson, put it well: “The economic cost to Scotland of our dependency on England is measured by the incomes, jobs and tax revenues that have been foregone as a result of the slower rate of growth of the economy because of its mismanagement under the Union.”
Once independent, Scotland will be able to make economic, social and foreign policy decisions that will benefit the people of Scotland.
In yesterday’s Herald, Tory peer Lord Dunlop wrote the ‘UK Government are doing more for Scotland than the SNP ever will'. Perhaps that explains why Scottish Tory leader Douglas Ross didn't meet with Johnson on his latest furtive foray into ‘North Britain.’
The most notable thing that the UK Government have done for Scotland is to forcibly eject it from the world’s largest free trade bloc and damage Scotland's economy. The post-Brexit reality is grim, and no amount of furious political spin can conceal it. Before Brexit, exports accounted for a fifth of Scottish GDP. In the year to June 2021, they had plunged 25% compared to 2019. James Withers, head of Scottish Food and Drink, said many firms have simply “given up” on trading with EU companies because of the “tsunami” of red tape and said the worst is yet to come.
The Australian trade deal, trumpeted by Liz Truss with such fanfare, won’t increase UK GDP by even a tenth of a percent over 15 years, while Brexit is projected to shrink GDP by 4.9%. The deal will raise maritime and aviation carbon emissions, allow in cheaper, inferior quality beef and lamb produced to lower animal welfare standards, and undercut Scottish farmers, threatening their livelihoods. This was all agreed without the involvement of Scotland.
As for replacing the annual £2.1 billion Scotland lost from EU structural funds for infrastructure improvement, poverty alleviation, skills enhancement and agricultural support, a Westminster cross-party report said the UK Shared Prosperity Fund will fall short by 40%.
The loss of free movement has hit the hospitality, care and road haulage sectors especially hard, resulting in widespread labour shortages. And Brexit has resulted in higher energy and food prices, compounding the cost of living crisis.
Scottish artists can no longer afford to travel and perform in Europe because the UK government rejected an offer of visa-free travel for touring musicians across the EU. Scottish students have lost the opportunity to live and study in the EU following the termination of the Erasmus scheme.
This is just some of what the UK Government have done for Scotland. Factor in epic corruption, from cash for peerages to billions wasted on Covid contracts for cronies, chronic underfunding of the NHS, cruel cuts to benefit payments and regressive tax increases, and it’s easy to understand why this unequal Union is close to collapse.
Lord Dunlop says the drivers of Brexit and Scottish independence have common roots. They do insofar as both are rooted in Westminster malfeasance and mismanagement. But what he misses is that Scottish independence is driven more by both, a strong desire to have a government that is accountable to and interested in improving the wellbeing of the Scottish people and creating a nation that is inclusive, more equal and internally focussed. That is only possible with independence.