Thursday, December 15, 2005
SCOTLAND's annual subsidy from England has shot up to a record £2,200 a head, according to official government figures, having more than doubled since Labour came to power.The self satisfied Labour position which is essentially that we are running the place so badly that you can't afford an alternative, is particularly disgusting. All government money is ultimately taken from individuals who had to work for it. There is no justification whatsoever for such waste. As a Lib Dem I think our party is going to have to take a look at ourselves. My hope is that after the next Scottish election we have a Lib/SNP/Con executive which makes a serious attempt to reach, at least, the poor standards of competence of Westminster. This would require some going back on previous promises by one party not to work with another but, after all, if you are in politics to serve the public interest rather than to grandstand you ought to be willing to pitch in.
Gordon Brown's spending bonanza has pushed Jack McConnell's budget to Scandinavian levels at a time when Scotland's tax burden dropped below that of England, Poland and Canada.
The figures from the Scottish Executive sparked a political storm yesterday as MSPs asked why it has failed to translate world-class spending into world-class public services.
In its annual survey of the Scottish economy, the Executive said the government spent £45.3 billion in 2003-4, putting Scotland in a rare club of countries where state spending is more than half of the entire economy.
But only £34 billion was generated in tax. This leaves an £11.3 billion gap, which has to be filled by tax collected in England, as Wales and Northern Ireland are also heavily subsidised.
The figures do not include North Sea oil and gas; but the study shows that even if Scotland had collected every penny of tax raised offshore, it would still have required a £7 billion subsidy from England.
But Jim Mather, the SNP's economic spokesman, said he was alarmed at the growing disconnect between economic growth and government spending in Scotland.
"If the figures are correct, the Executive has serious questions to answer about their stewardship of Scotland's economy," he said. "Is there any other country in Europe that has experienced such a devastating slip in revenue against expenditure?"
Mr Mather said that rising oil prices would help Scotland, but only if the country was independent. The tax haul from oil is expected to almost treble, from £4.3 billion in 2003-4 to £11.7 billion in 2006-7.
Labour seized on the GERS report to say it destroyed the case for Scottish independence. "This is a hammer blow to those who talk about independence, or even fiscal autonomy. This shows that there is money that Scotland gets from being part of the UK which it wouldn't get if it was independent," a spokesman said..................
State spending in Scotland is next year forecast to soar to £51.6 billion - or 52.2 per cent of the national economy. This is not only higher than the UK's 45.2 per cent, but also any country in the developed world save Sweden, Denmark and France.
But the tax revenue for Scotland in 2003 - the last full year where figures are available - shows Scotland has the seventh lowest tax take among the world's 30 most developed countries..........
It is worth pointing out that the if we actually used the extra £7 billion (£4.5 billion excluding borrowing) to cut most of corporation tax, just over £2 billion, business rates, ditto, & to build a new nuclear power station every 2 years, £500 million a year, we would run the serious risk of becoming the world's fastest growing economy. Particularly if we saved another few hundred million by cutting government regulators.