SCOTLAND’S growth is being dragged down by the UK, a leading economist has claimed.
Dr David Skilling, an expert in the economics of small advanced economies, who contributed to Andrew Wilson’s Sustainable Growth Commission Report, was speaking ahead of the launch of a research carried out for thinktank Reform Scotland.
READ MORE: Poll reveals HUGE support among Scots for Holyrood to control key issues
In his paper, Policy Insights for Scotland From Small Advanced Economies, Skilling estimates that Scotland’s GDP per capita is $39,337 (£29,282) in 2017 – slightly lower than that of the UK and below that behind 13 other small advanced economies, including New Zealand, Norway, Sweden, Finland, Hong Kong and Switzerland.
The former principal advisor at the New Zealand Treasury, pinned the blame partly on the slowdown in the oil and gas sector, and on “Scotland’s relatively deep exposure to the rest of the UK, which has underperformed the rest of Europe by significant margin over the past few years”.
The UK, he added, has been a “drag” on Scotland’s performance.
READ MORE: Calls for ‘arrogant’ David Mundell to resign as Scotland Secretary
Skinning writes: “There has been a consistent gap between Scotland’s GDP growth rates and that of other small advanced economies.
“This has led to a steady divergence in Scotland’s per capita income from that of other small advanced economies. Part of Scotland’s recent GDP growth weakness is due to the slowdown in the oil and gas sector (Norway has also suffered).
“Scotland’s relatively deep exposure to the rest of the UK, which has under-performed the rest of Europe by a significant margin over the past few years, is also a drag on performance.”
READ MORE: Scottish National Infrastructure Company 'can fill Carillion void'
Skilling suggests the government look at developing “human capital” – education and training and do more to fund research and development.
He also recommends tax rates remain in line with other small advanced economies – pointing out that in the 13 comparator countries the top rate for personal tax has been reduced from 47% to 44% since 2000.
Skilling told The National: “There’s nothing that I see, as an outsider, in Scotland that looks fundamentally different from other successful smaller economies.
“It’s obviously got a different constitutional situation.
“It really is just a matter of better using the new powers that have been devolved over the last period of time, and perhaps, over time getting more.
“But really using them with a degree of purpose and intent behind a clear ‘here’s what we want to do, here’s several growth engines that we identify, and here are the social, environmental outcomes as well’”.
A Scottish Government spokeswoman said: “We remain focused on growing the Scottish economy which is why the 2018-19 Budget delivered an increase of 64% in the economy, jobs and fair work budget as part of our investment of almost £2.4 billion in enterprise and skills”.
Why are you making commenting on The National only available to subscribers?
We know there are thousands of National readers who want to debate, argue and go back and forth in the comments section of our stories. We’ve got the most informed readers in Scotland, asking each other the big questions about the future of our country.
Unfortunately, though, these important debates are being spoiled by a vocal minority of trolls who aren’t really interested in the issues, try to derail the conversations, register under fake names, and post vile abuse.
So that’s why we’ve decided to make the ability to comment only available to our paying subscribers. That way, all the trolls who post abuse on our website will have to pay if they want to join the debate – and risk a permanent ban from the account that they subscribe with.
The conversation will go back to what it should be about – people who care passionately about the issues, but disagree constructively on what we should do about them. Let’s get that debate started!
Callum Baird, Editor of The National
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules hereLast Updated:
Report this comment Cancel