Scottish Independence and the Scottish Economy

Debate between Ian Murray and Pete Wishart

Wednesday 2nd November 2022 Commons Chamber

[Ian Murray]

I will come back to hon. Members—I promise I will come back—but let me just make some progress.

All this brings us to deficit and debt, which is the great elephant in the room when it comes to independence. Let us talk about what independence would cost, and the scale of public service cuts that would be required. Very helpfully, These Islands—an organisation that believes that Scotland should stay in the UK—made the following comment, which I thought was quite interesting:

“We are waiting with trepidation about how the Chancellor will fill a £50 billion black hole”,

which, it said, equates to about 2% of UK GDP. An independent Scotland would have to fill a hole equivalent to more than 10% of Scottish GDP, so there would be five times the problem that has been created by the Tories at Westminster. As the First Minister acknowledged, the Scottish economy would be cut off from its biggest trading partner by a hard border. But before we even take account of the devastating impact of this, we just have to look at the Scottish Government’s own accounts.

[Pete Wishart (Perth and North Perthshire) (SNP)]

Will the hon. Gentleman give way?

[Ian Murray]

Let me just finish this point. I promise that I will give way in a moment.

We are not helped by the Scottish Government’s paper itself, which simply chooses to ignore the figures from Government Expenditure and Revenue Scotland and pretend that they do not exist. The paper says:

“No estimate of the fiscal starting point for an independent Scotland’s finances is included in this document.”

That is rather surprising, because the SNP has—along with Labour and other Opposition parties—rightly been demanding that the UK Government produce the figures from the Office for Budget Responsibility on the forecast for the UK economy on the basis of their botched mini-Budget. The SNP does not even mention its much-lauded growth commission, which it has now junked. That does not seem very reassuring.

[Pete Wishart]

Will the hon. Gentleman give way?

[Ian Murray]

Let me just finish this point. I will come back to the hon. Gentleman.

The starting point was always the Scottish Government’s own accounts—the GERS figures that the First Minister used to use as the starting point and bible have now been disowned. Every previous key document on their independence case had referenced those figures, and I have them here. Their independence referendum White Paper states:

“GERS is the authoritative publication on Scotland’s public finances.”

“Scotland’s Future: What independence means for you” cites its source as Government Expenditure and Revenue Scotland—that is, GERS. “The Economic Case for Independence” states:

“This report uses data published in the annual Government Expenditure and Revenue for Scotland (GERS) report.”

“Pensions in an Independent Scotland” also states:

“This report uses data published in the annual Government Expenditure and Revenue Scotland (GERS) report.”

“Your Scotland, Your Voice” states:

“The most recent GERS demonstrates that Scottish public finances ran current budget surpluses in each of the three years”.

[Pete Wishart]

Will the hon. Gentleman give way?

[Ian Murray]

I will give way to the hon. Gentleman before his knees give out.

[Pete Wishart]

I am genuinely grateful to the hon. Gentleman, but he need not worry about my knees. He is coming very close to saying that somehow the Scottish people, with all our resources and our history of invention and creativity, are unique in the world in that we would not be able to make a success of independence. What does he think is so lacking in the Scottish people that we, among all the peoples of the world, would not be able to make a success of being an independent nation?

[Ian Murray]

By the hon. Gentleman’s proposition, I could go into Barclays bank on Monday morning when my mortgage is due and say, “I’m not going to pay it” while waving the saltire. I wonder if the bank manager would accept that as payment.

This debate is not about the Scottish people; it is about the bust proposition that is being put to the Scottish people on independence. There is no doubt that the Scottish Government are now GERS deniers. These are their own figures; this is the crux of the issue. The Scottish Government’s own accounts show a deficit in Scotland of £23.7 billion, which is equivalent to 12% of Scottish GDP or 1.5 times the entire budget of the Scottish NHS. How do they plan to resolve that deficit? Where will the spending cuts land? If they are going to borrow tens of billions to support a new currency, what happens to the day-to-day spending deficit? Do they borrow that as well? At what cost, and in what currency? I am afraid that this paper makes the Conservatives’ mini-Budget look like an economic masterstroke.

Let me finish by talking about borders. For the first time, the Scottish Government and the nationalists have admitted that there would be a hard border between Scotland and England. Families and businesses who for three centuries have bonded and traded freely would be split up by a hard border, a different currency and a different country—[Interruption.] Members keep braying from a sedentary position, but they have no answers to these questions. In fact, the answers they are giving us make their position worse, not better. Let us be clear: Scotland trades more with the rest of the United Kingdom than it does with the rest of the world combined. The SNP’s response to the Conservatives’ damaging Brexit is to commit an act of economic folly that would be several orders of magnitude worse.

The SNP has no credible answers on pensions either. The right hon. Member for Ross, Skye and Lochaber claimed that the UK Government would continue to pay Scottish pensions after independence, having seemingly not read his party’s own policy from 2014. So who will pay? Will somebody clarify whose position on pensions is right? Is it the right hon. Gentleman, the First Minister or the papers that they have put into the public domain?

Let me finish with words from themselves—

--- Later in debate ---

[Ian Murray]

I agree with the hon. Gentleman, and I am delighted that he has given way so early. This debate is not about that; it is about the broken proposition that he is putting as a prospectus for that independent Scotland. That is what we have demonstrated has holes in it. It is up to him to make that proposition, not us.

[Pete Wishart]

I will respond to that challenge and I thank the hon. Gentleman, because I think I heard him say that Scotland would be a successful independent country. I think that is what he was saying.