NICOLA Sturgeon has defended a report commissioned by the SNP setting out a new economic blueprint for independence after left-wing critics in the Yes movement said its recommendations would lead to further years of austerity.
The First Minister posted a series of tweets yesterday addressing the controversy sparked by last week’s document by the Sustainable Growth Commission.
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Former MP George Kerevan and Scottish Socialist Party leader Colin Fox were among the figures taking issues with some of the commission’s findings, in particular over a recommendation not to introduce an independent currency, but to carry on using the pound, and an ambition to reduce the country’s budget deficit to around 3%.
“Reading lots of interesting comments about the #GrowthCommission – which is good. So much better to be discussing how to build a successful independent Scotland than just resigning ourselves to managing the decline of Brexit UK. A few points worth underlining though,” she said.
“The report explicitly rejects austerity eg Part B p44 – “Scotland should explicitly reject the austerity model pursued by the UK in recent years” and recommends above inflation spending growth each year. A marked contrast to the failed Westminster approach. Report also stresses importance of investment to boost economy and that fiscal targets should not be at the expense of growth – another sharp contrast with Westminster. Indeed, it recommends fiscal stimulus both in the independence transition and in periods of low growth.”
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She added: “The report’s projections about deficit reduction are deliberately cautious. They make no assumptions about higher growth – and instead illustrate that even in worst case scenario independence is a better option that sticking with Westminster system that created the deficit.”
She continued: “We have a choice – stay as we are, locked into the Brexit spiral and continued austerity that the Westminster parties offer no alternative to – or decide to equip ourselves with the powers to build our way to a better future.
“Policy choices in an independent Scotland will always be for the government of the day, so we should welcome debate – but without independence, these choices will always be far too limited. That’s the case we must win – and #GrowthCommission helps us do it.”
Commissioned by the First Minister in 2016, the document updated the case for independence in the wake of the Brexit vote. It compared the performance of the Scottish economy inside the UK and those of 12 small independent nations.
It concluded matching their performance over the next 25 years would mean the average Scot would be better off by £4100 a year.
It also suggested an independent Scotland should voluntarily pay the UK an annual ‘solidarity payment’ of £5.3bn”. The report said an independent Scotland would start without any debt as there is not a mechanism whereby existing UK debt could be transferred.
However, it recommended that the yearly “solidarity payment” to help reduce Britain’s borrowing: £3 billion would go towards service British debt obligations; £1.3 billion would be put towards foreign aid support; and £1 billion would pay for other shared services.
The Government Expenditure and Revenue in Scotland report for 2015-16 estimated a public sector spending deficit of £13.3 billion, equivalent to 8.3% of GDP.
The Growth Commission suggested that would reduce to 7.1% of GDP assuming transition arrangements were in place by 2021-22 and should be further reduced to 3%.
Writing in The National earlier this week Kerevan accused the Commission of “pandering to the status quo”, warning that it risked “robbing” the next independence campaign of working class support.
Jonathon Shafi, the co-founder of the Radical Independence Campaign, said the recommendations “open the door to various forms of austerity politics” and would be a “very hard sell” to voters.
Colin Fox, the leader of the Scottish Socialist Party, said it would boycott any new Yes Scotland organisation which used the Commission’s case for independence.
“[The] voluminous Sustainable Growth report offers nothing to working class Scots under austerity’s cosh these 10 years past,” he wrote in The National yesterday.
“Rather it offers them another 10 years of the same ... It risks driving hundreds of thousands of former Yes voters into the hands of Jeremy Corbyn.”
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