CLAIMS an independent Scotland would suffer Greek-style austerity cuts of about £19 billion have been dismissed as flawed by the Scottish Government.

A spokesman for the SNP economy secretary Keith Brown hit back at a report in a London-based paper, saying the organisation behind the forecast had spent the last decade and a half predicting the country was about to turn into a “Third World” economy.

He added that official figures showed productivity north of the Border was steadily growing - and was four times faster than the UK’s.

His comments were in response to a front page story in the Sunday Times which said a new analysis by the Centre for Economics and Business Research (CEBR) predicted that the gap between what Scotland raises in taxes and spends on public services would rise to an “unsustainable” 9.4 per cent in 2017/2018.

Douglas McWilliams, the consultancy’s president, said the deficit would be higher — at 12 per cent — if the country was independent because of extra costs involved in becoming a new state.

Claiming that Scottish politicians must overcome their “addiction to tax and spend”, he said: “The only practical option would be to cut public spending.

“Because of the negative Keynesian multiplier effects, there would need to be cuts of about 15 per cent of GDP. That’s roughly on the scale of what happened in Greece, which has led to a fall in GDP of a quarter.”

Pointing out that Scottish GDP growth was only 0.5 per cent in 2016 compared with UK growth of two per cent, McWilliams added: “With Scotland suffering tax increases and likely loss of high income earners to England, growth could even be negative in 2017 — our forecast is for GDP to fall by 0.1 per cent.”

McWilliams said the figures strengthened the case for Scotland to have its own currency, an independent Scottish pound in the event of independence to give it greater control.

The idea for a Scottish pound is being examined by a SNP growth commission led by former SNP MSP and economist Andrew Wilson.

Nicola Sturgeon has said another independence referendum is “highly likely” after Scotland voted to remain in the EU by 62 per cent, but faces being taken out of the bloc despite the result north of the Border.

Last week, former Labour Prime Minister Tony Blair said the case for Scottish independence has become “much more credible” following the Remain vote in Scotland.

Responding to the “Greek-style austerity” claims, a spokesman for Brown said: “For almost 15 years this organisation has been claiming that Scotland is about to turn into — in their words — a ‘Third World’ economy, and we and others have continuously been pointing out the flaws in their methodology.

“Latest actual figures show that productivity – the key driver of economic performance – is growing four times faster in Scotland than the UK.

“A hard Brexit will put this at serious risk and would be a disaster for Scotland. The CEBR have themselves previously outlined the importance of remaining in the Single Market to GDP, and how thousands of Scottish jobs depend on the EU — so it is somewhat surprising, to put it mildly, that none of this appears to have been factored into the analysis presented here.”