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The SNP should level with the voters: independence won’t be a walk in the park.


“IT’S Scotland’s Oil,” claimed the once-ubiquitous SNP slogan. But times change: “It was Scotland’s Oil” makes more sense today. As recently as 2008, North Sea Oil revenues amounted to £11.5 billion – equivalent to a third of the Scottish Government budget. Today they are down to £60m having fallen 96 per cent last year alone.

This is not just a revenue issue. According to Oil and Gas UK, 100,000 jobs have been lost in the North Sea Oil industry since the downturn in the oil price began four years ago. These jobs were often highly-paid and highly-skilled and many well never come back.

Of course, oil prices can go up as well as down. The devaluation of the pound has already brought a nominal increase of 20 per cent because oil is valued in dollars. But the industry is unlikely ever to be the same again, even though there is an estimated 20 billion barrels of oil left in the Scottish sector. The industry is downsizing, rather as the manufacturing industry shrank during the recessions of the 1980s.

So the the former SNP MSP, Andrew Wilson, of the party’s Growth Commission, was right to insist that oil cannot form the “basis” of the independent movement’s economic strategy. Unfortunately, for the last two decades, it has been a very large part of it. And the oil price crash will hang like a dark shadow over the next independence referendum campaign, if and when it happens.

Of course, many small countries, like Denmark, have little or no oil industry and do very well. Oil can even be a resource curse, as in countries like Nigeria or Venezuela, where it crowds out other economic activity and an over-valued petro-currency makes exports uncompetitive. But the SNP has its work cut out trying to argue this now, after years of calling it a boon and a blessing.

John Swinney began the reframing of Scotland’s Oil at first Minister’s Questions, recently when he lamented the failure to capture for Scotland more of the £300bn of revenues that have gone south over the last four decades. The SNP will try to turn North Sea Oil from a present grievance to an historic one: saying that revenues were purloined by rapacious Westminster governments and used to build the parasitic financial services industry in the south east. Some argue that Scotland even deserves compensation, and should demand this in any negotiations about Scotland’s share of UK debt after independence.

But the precipitate decline of the oil industry, at least for the foreseeable future, is clearly one of the reasons Nicola Sturgeon was canny about calling another referendum. The other is the risk that after independence there would have to be a squeeze on social spending as the Scottish economy readjusts. Estimates of Scotland’s nominal deficit – 9.5 per cent of GDP – may be open to dispute, but there is no doubt that in the short term at least, the books would be difficult to balance. She doesn’t want to find that her precious social programmes have to be reined in.

Nicola Sturgeon is not an existential nationalist like Alex Salmond; she only sees independence as a means to an end. In many ways, she agrees with the Scottish Socialist Party leader, Colin Fox, an ex-board member of Yes Scotland, that the end should be social equity, not independence for its own sake.

Fox warned her not to go for an early referendum, arguing that it might unsettle working-class voters who are unsure about Brexit. He’s not alone.  Like the former SNP minister, Alex Neil, Fox believes a premature referendum could destroy the cause of independence in future. “The world of September 2014 has gone forever.”  The old Yes Scotland campaign is going to be hard to reconstruct.

 

There is of course no reason why Scotland cannot be a successful independent country in the medium term. With the national income of a country like Portugal and the population of Slovakia, Scotland can certainly manage on its own. But as always with independence, it’s all about getting from here to there. Does Scotland have the will and determination to cut the bonds of Barnett dependency and stand on its own feet?

If Indyref 2 is announced, the Scottish Government will have to level with voters and not rely on tacky billboards telling them they’re living “in one of the world’s wealthiest countries”. Voters aren’t fools – they can see for themselves what has happened to the energy industry. The independence movement will have to make a virtue of necessity: appeal to Scotland’s sense of itself as an open-minded, outward-looking European nation which can take care of itself.

The truth is that “It’s Scotland’s Oil” was one of the SNP’s least successful slogans. Scots didn’t like to think of themselves as grasping individualists trying to become tartan sheiks, and the campaign actually bombed after the 1970s. Perversely, the loss of oil could make the moral case for independence stronger. It’s a fallacy anyway that people vote purely on a narrow calculation of self-interest. They may equally decide that the political culture of Brexit Britain is simply one they can’t stomach. Theresa May isn’t exactly persuading them otherwise.

 

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About iain2macwhirter

Writer and journalist.

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