Economy

Exclusive: research shows Scotland would have benefitted more from independence than devolution

Stephen Richard — Fri, 05 Nov 2021 12:15:03 +0000

Exclusive: research shows Scotland would have benefitted more from independence than devolution

Primary Author or Creator

Believe in Scotland

Stephen Richard Fri, 11/05/2021 - 12:15

Alternative Published Date

2021

Category

Economy

Fast Facts

Many countries have shown great success after independence, particularly in terms of GDP growth and developing their own currency. Overall, it can be suggested that full independence would have contributed to greater GDP growth for Scotland than devolution.

More details

Since 1990, 34 territories have become independent countries. Many of these new countries were formed as a result of the dissolution of the USSR and Yugoslavia during the 1990s. Others formed as a result of independence and anticolonial movements.

The 1990s was also a significant period for Scotland, with the reconvening of the Scottish parliament and the transfer of devolved powers. This article sets out to compare the different experiences of these newly independent countries and Scotland as a devolved nation, analysing the various currencies that have been adopted, their GDP growth rates and their successes as independent countries.

This will allow us to determine whether Scotland would have benefitted more from independence in the 1990s than from the limited powers obtained through devolution. We will also be able to offer a hypothetical picture of what an independent Scotland may have looked like, including its potential currency and the country’s probable financial situation.

EU members

First, let’s look at the countries that have joined the EU since declaring independence, and examine the currencies that have been adopted and the impact independence has had on their GDP. Of the countries formed since 1990, eight have become members of the EU, including Estonia, Latvia, Lithuania, Croatia, Slovenia, Germany, Czech Republic and Slovakia.

However, not all of these countries have chosen to employ the Euro. For example, Croatia and the Czech Republic introduced their own currency after independence. In fact, in Croatia the National Bank was formed in 1990, before the country was actually independent, and the new Croatian Dinar followed in December 1991. In May 1994 the Croatian Kuna replaced the Dinar, as part of the government’s stabilisation programme that followed Croatia’s involvement in the Bosnia-Herzegovina war. This stabilisation programme and the introduction of the Kuna brought inflation down from the 1993 rates of 1616% to 1.0% in 1994 and 3.7% in 1995. Since the introduction of the Croatian Kuna, it has remained stable and has effectively countered inflationary expectations.

Employing the Euro after independence is not a necessity and countries can join the EU without doing so

Some of the other newly independent countries adopted the Euro further down the line after independence and several years after joining the EU. For example, Estonia gained independence in 1991 and established its own currency – the Estonian Kroon – just 10 months later. Estonia joined the EU in 2004 but did not adopt the Euro until 2011. This highlights that employing the Euro after independence is not a necessity and countries can join the EU without doing so.

The figures show that on average the newly independent countries that have joined the EU have a GDP growth rate of 2.84%. Those that have joined the EU and adopted the Euro have an average of 3.07%. Those countries that are members of the EU but have their own currency averaged at 2.15%.

Non-EU members

So, what is the currency situation and average GDP rate in newly independent countries that are not members of the EU?

The data suggests that across most of these independent countries, a new currency has been formed. The average GDP growth since independence across all of these countries is 2.68%. Among those countries that have created their own currency, it is 3.09%. This suggests that the introduction of a new currency after independence may benefit GDP growth rates.

Scotland

Since the 1990s Scotland has held certain devolved powers. However, unlike the countries that we have examined throughout this article Scotland has not obtained full independence. As a result, it continues to use the British Pound as its currency. So, how does Scotland’s annual GDP growth compare to the newly independent countries that we have looked at? Since devolution was introduced until the present day, Scotland’s GDP growth rate averages at 1.4%. This is considerably lower than the averages we have seen across the many newly formed countries, both within and outside of the EU.

Conclusions

Ultimately, this article has highlighted that different routes and options exist for newly independent counties with regards to currency and EU membership. Many of the countries that have been analysed in this article have shown great success after independence, particularly in terms of GDP growth and developing their own currency. Overall, it can be suggested that full independence would have contributed to greater GDP growth for Scotland than devolution.

Resource Address (URL)

https://www.believeinscotland.org/research-shows-scotland-would-have-benefitted…

Keywords

Prosperity

GDP

Economy

Language English

Scotland challenges inequality, while UK falls behind

Stephen Richard — Fri, 05 Nov 2021 12:00:09 +0000

Scotland challenges inequality, while UK falls behind

Primary Author or Creator

Believe in Scotland

Stephen Richard Fri, 11/05/2021 - 12:00

Alternative Published Date

2021

Category

Economy

Wealth

Fast Facts

It is evident that inequalities and uneven levels of deprivation across the UK continue to be a significant problem. However, it is also clear that Scotland is continually challenging these inequalities and the Scottish Government is working to ensure that levels of GDP per head in Scotland match the average of EU countries

More details

Deprivation is a useful measure to identify areas of the country that are experiencing significant disadvantage. The Scottish Index of Multiple Deprivation (SIMD) uses statistics on income, employment, health, education, access to services, crime and housing to calculate the level of deprivation across all regions of Scotland. Last year, levels of deprivation fell in Glasgow City, Renfrewshire and City of Edinburgh compared to SIMD 2016. Glasgow City demonstrated the greatest fall, from 48% of data zones in the 20% most deprived areas in Scotland, to 44%.

However, the UK Government has not privatised solving deprivation and so, a UK-wide index of multiple deprivation does not exist. Therefore, it is difficult to compare levels of disadvantage in areas of Scotland and other regions of the UK. As a result, this article will offer a comparison of GDP per head of population, one of the common indicators of deprivation and disadvantage, within the UK and across the EU.

10 Regions of UK with lowest GDP per head (2018) RegionGDP per head

Tees Valley and Durham (England) 21,882

Northumberland and Tyne and Wear (England) 24,960

Merseyside (England) 24,464

South Yorkshire (England) 22,104

Lincolnshire (England) 23,322

Outer London – East and North East (England) 22,626

Cornwall and Isles of Scilly (England) 22,096

Devon (England) 23,858

West Wales and The Valleys (Wales) 21,274

Southern Scotland (Scotland) 19,937

As this table demonstrates, of the 10 regions with the lowest GDP per head in the UK, only one area is within Scotland. Meanwhile, 8 of the regions are within England and one is in Wales. This suggests that economic inequality is a greater problem in the rest of the UK than it is in Scotland.

Furthermore, it is interesting to compare these figures to the EU-27 countries average GDP per head of population. Indeed, it has been implied that regions within the UK have struggled to keep pace with the rest of Europe since the financial crash in 2008.

In 2018, GDP at market prices in the EU-27 was valued at 13.5 trillion euros, equivalent to an average of 30,200 euros per person (approximately £26,195.63).

UK NUTS 2 (Nomenclature of Territorial Units for Statistics)

Regions with GDP per head lower than EU-27 Average RegionGDP per head (£)% of EU-27 Average

Tees Valley and Durham 21,882 83%

Northumberland and Tyne and Wear 24,960 95%

Merseyside 24,464 93%

South Yorkshire 22,104 84%

Derbyshire and Nottinghamshire 25,367 97%

Lincolnshire 23,322 89%

Shropshire and Staffordshire 25,574 98%

Outer London – East and North East 22,626 86%

Dorset and Somerset 25,442 97%

Cornwall and Isles of Scilly22,09684%

Devon 23,858 91%

West Wales and The Valleys 21,274 81%

Southern Scotland 19,937 76%

Northern Ireland 25,981 99%

This table highlights that many regions across the UK continue to lag behind many European countries in terms of GDP per capita. Indeed, 14 NUTS 2 regions in the UK have a GDP per head lower than the EU-27 average. Of these regions only 1 is in Scotland, 1 is in Wales, 1 is in Northern Ireland and 11 are in England.

The major exception

While we have demonstrated that deprivation and inequality are rife across England, there continues to be one major exception – London. In fact, this is a huge part of the problem. In 2018, data from the Office for National Statistics showed that London recorded a 1.1% annual rise in output per person to £54,700. Meanwhile, in the North East, growth was only 0.4%, rising to just £23,600 per head. This shows a further widening of the per capita gap between the richest and poorest regions of the country.

We have recognised for years that the key issue at play here is that the UK is far too centralised around London and the South East. Seven years ago, at Business for Scotland, we said that “power, money, opportunity and influence has been drained from the rest of the country for generations towards a metropolis that has developed its own financial and capitalist culture which sits a world apart from the distant regions and nations that make up the wider UK” and unfortunately, this still applies today but to an even greater degree. Ultimately, this constant investment in London and the financial sector has resulted in huge disparity across England, and harmed the other nations of the UK, including Scotland, Wales and Northern Ireland.

Further mismanagement

The past year has undoubtedly been a challenging one for many countries across the world, with the COVID-19 pandemic having drastic consequences for economies and healthcare systems worldwide. However, adding a hard Brexit deal to the equation has only worsened matters, particularly with regards to deprivation. Indeed, studies have found that there is a high risk that the economic impacts of COVID-19 and Brexit will further increase regional disparities. In particular, already deprived areas such as the North East, Wales and Outer London are likely to be hardest hit by Brexit. Meanwhile, tourism dependent coastal communities and hospitality dependent cities such as Manchester and Liverpool are already facing drastic consequences as a result of COVID-19.

These struggles are only emphasised by the lack of support displayed by the UK Government. Indeed, new research has shown that if the Chancellor’s plans to cut Universal Credit go ahead, millions of individuals will be left without the income needed to afford the minimum living standard and the Scottish Child Payment will be undermined. Indeed, after years of austerity, followed by the chaos of Brexit and a global pandemic, such policy decisions will only cause further deprivation and inequality in the UK, particularly in England where great disparity already exists. This highlights that as a result of UK Government mismanagement and the already severe levels of inequality, certain impoverished areas in England are likely to suffer further in the coming months and years.

Southern Scotland

This region is the only area of Scotland that is within the 10 regions of the UK with the lowest GDP per head and holds a GDP per capita lower than the EU-27 average. However, it is important to note that this situation is gradually improving and the GPD per head of population in this region has significantly improved since 2011. In 2011, Southern Scotland’s GDP per head was £16,142. Meanwhile, the EU-27 average was approximately £22,346. This means that Southern Scotland’s GDP per head was approximately 72% of the EU-27 average in 2011. However, in 2018, this figure had risen to 76%, demonstrating the gradual increase of GDP per head and the closing gap between Southern Scotland and the EU-27 average.

Scottish Government Approach

So, let’s see why Scotland is leading the way in reducing such deprivation. One of the key ways to tackle deprivation is through education. Indeed, the Scottish Government recently announced the investment of £215million to benefit pupils in Scotland’s most deprived communities.

An area in which the Scottish Government has also invested in to reduce deprivation and inequality is affordable housing. Indeed, in the 2021-22 budget, £711.6 million was dedicated to affordable housing and a new £55 million programme was put in place to support town centres.

Another critical example that extends to the wider community is the Empowering Communities Fund. This programme was established in 2015 and has already had huge benefits for deprived communities in Scotland. To date, the programme has helped hundreds of projects that create change in disadvantaged communities through training, employment, healthy eating and volunteering opportunities.

It is clear that reducing inequalities and deprivation is a key ambition of the Scottish Government and one that is continuously being met, with levels of deprivation reducing across the country.

Conclusions

Resource Address (URL)

https://www.believeinscotland.org/scotland-challenges-inequality-while-uk-falls…

Keywords

Wealth

Economic inequality

Language English

Independent wellbeing economy offers hope rather than Brexit chaos

Stephen Richard — Fri, 05 Nov 2021 11:16:54 +0000

Independent wellbeing economy offers hope rather than Brexit chaos

Primary Author or Creator

Believe in Scotland

Stephen Richard Fri, 11/05/2021 - 11:16

Alternative Published Date

2021

Category

Economy

Type of Resource

Article

Fast Facts

Independence offers the only realistic chance of escape from a government seemingly hell bent on damaging our economy

More details

Get Brexit Done … three words which won the Conservative Party the 2019 UK general election south of the Border and the driving force which pushed Boris Johnson to desperately pull together a dangerous and disastrous trade ‘deal’ as the January 1, 2021 deadline approached.

Yet less than a year later Johnson’s government has moved from cheerleaders for the ‘deal’ – which decimated UK exports, particularly Scottish exports, and sparked chaos in supply chains leading to food and petrol shortages all over the country – to standing on the verge of a trade war with Europe.

We’ll soon find out just how serious that trade war threat is. Europe is due to respond to UK government demands that it agree to significant changes to the Northern Ireland protocol, ironically negotiated by UK ministers to avoid a hard land border between Northern Ireland and the Republic of Ireland.

But this rather begs the question: does Boris Johnson really want a deal at all?

Reports suggest it is unlikely the EU will move far enough on protocol changes to satisfy Johnson and his cronies, although European politicians are experts on compromise and may yet make more concessions.

But that rather begs the question: does Boris Johnson really want a deal at all? Certainly Irish foreign minister Simon Coveney recently tweeted his doubts on that, accusing the UK of setting out a new “red line” just days before the EU was set to offer “serious” concessions. He said: “Are we surprised? Real Q: does UKG actually want an agreed way forward or a further breakdown in relations?”

It’s certainly true that the Prime Minister has previously revealed a preference for chaos, which is certainly what his trade ‘deal’ has brought to the UK.

If the Northern Ireland protocol disagreement can’t be resolved a trade war between the EU and the UK looks likely and the consensus is that this would hurt Britain more than Europe. There has even been one suggestion that the EU response could include tariffs on Scottish salmon.

Whether or not that happens it is certainly true that Scotland is suffering from the Brexit catastrophe more than the rest of the UK. The latest figures released by HM Revenue and Customs reveal that in the quarter ended in June 2021 Scottish exports decreased by 14% compared to the same period the previous year. That compared with export declines in England, Wales and Northern Ireland of 2.2%, 13% and 6.1% respectively in the same period.

Independence offers the only realistic chance of escape from a government seemingly hell bent on damaging our economy

All this surely adds power to the case for Scottish independence. It would, after all, offer the only realistic chance of escape from a government seemingly hell bent on damaging our economy and stripping powers from our parliament.

But we need to beware an argument increasingly put forward by Unionist supporters: that Brexit has caused so much trouble that we cannot risk adding independence to an already chaotic situation.

The truth, of course is that the chaos is entirely the creation of a criminally reckless UK government. Independence is entirely normal in most countries in the world, where it works perfectly well.

It is even more essential in Scotland as we emerge from the pandemic and can seize the opportunity to rebuild our economy based on the principles of wellbeing and equality rather than the greed and naked self-interest guiding the actions of the Westminster government.

An economy which works for the benefit of the people of Scotland and reflects their values and priorities.

Over the months ahead Believe in Scotland will show exactly how we can create that economy and offer hope for the future rather than the despair which is the inevitable result of being part of the Union.

Resource Address (URL)

https://www.believeinscotland.org/independent-wellbeing-economy-offers-hope-rat…

Keywords

Brexit

Language English

Scotland the Brief

Stephen Richard — Tue, 26 Oct 2021 20:19:05 +0000

Scotland the Brief

Primary Author or Creator

Gordon MacIntyre-Kemp

Stephen Richard Tue, 10/26/2021 - 21:19

Additional Author(s) / Creators

Business for Scotland

Publisher

Business for Scotland

Alternative Published Date

2020

Category

Economy

Public Finance

Type of Resource

book

Length (Pages, words, minutes etc...)

191pp

Fast Facts

All you need to know about Scotland's economy, its finances, independence and Brexit.

More details

Scotland the Brief began as a collection of illustrated Scottish economic facts published by Business for Scotland. Over two years, those graphics generated more than four million views and shares on our website and via social media. From that foundation, we’ve produced this book.

Scotland the Brief summarises an in-depth investigation into the breadth, structure and quality of Scotland’s economy. It is written in layman’s terms by Gordon MacIntyre-Kemp and colourfully illustrated by Stewart Bremner to make it easy to understand and absorb, as well as fun to read.

Scotland the Brief answers the burning question – would Scotland prosper as an independent nation?

We also take an in-depth look into the UK Government’s economic record, which we compare to other Western and Northern European nations – with frankly shocking results. The fact is that you cannot truly understand Scotland’s economy and its finances until you have read Scotland the Brief.

Regardless of how you feel about independence, Scotland the Brief will open your eyes, engage and educate you by supplying you with the facts you need to truly inform your opinion on Scotland’s future.

Scotland the Brief comes in two versions:

The standard-sized A5 book nicknamed the Maxi contains a lot more information across 190 pages, backed up with a numbered list of 418 sources for facts throughout the book. A reference copy for anyone who wants to understand Scotland economy – The Maxi book retails at £7.50.
The Mini, an A6 sized book is the quick reference copy (a 74-page abridged version of the full-sized book) it fits easily into a jacket pocket or handbag and most of the pre-orders are for people who intend to keep one to read and one give to friends and colleagues. The Mini retails at £3.50.

Resource Address (URL)

https://www.businessforscotland.com/scotland-the-brief/

Keywords

Language English

Beyond GDP: here’s a better way to measure people’s prosperity

Stephen Richard — Sun, 17 Oct 2021 10:00:21 +0000

Beyond GDP: here’s a better way to measure people’s prosperity

Primary Author or Creator

Henrietta Moore

Stephen Richard Sun, 10/17/2021 - 11:00

Additional Author(s) / Creators

Institute for Global Prosperity, UCL, The Conversation

Date Published

Tue, 10/12/2021 - 12:00

Category

Economy

Fast Facts

Rather than the outmoded measures of growth, productidvity and income, our research indentifyed 15 headline indicators - a prosperity index - that refledt the actual experience of well being and security for people.

More details

Early evidence suggests the UK government’s approach to levelling up will once again heavily depend on the same tired approaches – like targets for house building and job creation that have failed in the past to resolve regional and local inequalities and address social and economic exclusion.

New levelling up requires a sharing of knowledge. Allowing citizens, local government, businesses and community organisations to collaborate, make decisions, trial radical new approaches and rapidly evaluate change. Shared knowledge creates the opportunity to identify innovative policy options and new pathways to prosperity that are more targeted and more effective at improving quality of life.

Involving local people in the process creates a new way to understand, conceptualise and measure prosperity, inform local decision-making and equip communities with the tools, evidence and confidence they need to monitor progress and hold decision makers to account.

Resource Address (URL)

https://theconversation.com/beyond-gdp-heres-a-better-way-to-measure-peoples-pr…

Keywords

Prosperity

GDP

Language English

How to future-proof Scotland's economy. Open Minds on Independence #15

Stephen Richard — Sun, 10 Oct 2021 09:46:54 +0000

How to future-proof Scotland's economy. Open Minds on Independence #15

Primary Author or Creator

The National

Stephen Richard Sun, 10/10/2021 - 10:46

Additional Author(s) / Creators

Believe in Scotland

Date Published

Sat, 04/03/2021 - 12:00

Category

Economy

Type of Resource

News Media

Fast Facts

Rapidly growing new and high-tech industries are also driving Scotland’s economy which is actually more diverse than the rest of the UK. Three areas are of particular importance: Life sciences, digital industries, and space industry.

Resource Address (URL)

https://www.thenational.scot/news/19208160.open-minds-independence-15-future-pr…

Keywords

Scotland's economy

Aerospace industry

Life sciences in Scotland

Digital industries

Language English

This is how independence can boost our innovation nation status

Stephen Richard — Sun, 10 Oct 2021 09:39:09 +0000

This is how independence can boost our innovation nation status

Primary Author or Creator

The National

Stephen Richard Sun, 10/10/2021 - 10:39

Additional Author(s) / Creators

Believe in Scotland

Date Published

Tue, 03/30/2021 - 12:00

Category

Research

Economy

Type of Resource

News Media

Fast Facts

One of the key drivers of a successful economy is innovation. Scotland has a proven track record of being a highly innovative nation. This can be one of the foundations upon which to build an exciting economic future. Main elements are information technology, life sciences, software and gaming, and space technologies.

Resource Address (URL)

https://www.thenational.scot/news/19198918.independence-can-boost-innovation-na…

Keywords

Research Scotland.

Technological innovations Scotland.

Language English

Only independence can fix damage of Brexit, Open Minds #13

Stephen Richard — Sun, 10 Oct 2021 07:23:56 +0000

Only independence can fix damage of Brexit, Open Minds #13

Primary Author or Creator

The National

Stephen Richard Sun, 10/10/2021 - 08:23

Additional Author(s) / Creators

Believe in Scotland

Date Published

Fri, 08/20/2021 - 12:00

Category

Economy

Type of Resource

News Media

Fast Facts

Scotland's economy benefits from a range of advantages that few other countries of similar size can match. Our natural wealth is a key foundation stone for a prosperous future as an independent country. It is reasonable to believe that a country as naturally wealthy as Scotland would thrive if it were to gain the power to manage for its benefit.

Resource Address (URL)

https://www.thenational.scot/news/19191851.open-minds-13-independence-can-fix-d…

Keywords

Brexit

Exports

Language English

The UK’s Brexit mismanagement, Open Minds on Independence #11

Stephen Richard — Sun, 10 Oct 2021 07:06:16 +0000

The UK’s Brexit mismanagement, Open Minds on Independence #11

Primary Author or Creator

The National

Stephen Richard Sun, 10/10/2021 - 08:06

Additional Author(s) / Creators

Believe in Scotland

Alternative Published Date

2021

Category

Economy

Type of Resource

News Media

Fast Facts

There were a number of mistakes made in negotiating a Brexit arrangement.
This was imposed on Scotland against its will. It has turned out to be a disaster for key industries.

1. Ignoring the wishes of Scotland and the other devolved nations

2. Sticking so rigidly to “getting Brexit done” that it made an acceptable trade deal impossible. It was immediately apparent there were serious problems.

3. Underestimating just how big a problem taking Northern Ireland out of the EU would be.

4. Using Brexit as an attack on devolution and to reduce the powers of the Scottish Parliament

5. Breaking promises to keep Scotland involved and informed in negotiations

Resource Address (URL)

https://www.thenational.scot/news/19174983.open-minds-independence-11-uks-brexi…

Keywords

Language English

Political Activism and Agnecy under Austerity and Brexit

Stephen Richard — Wed, 06 Oct 2021 09:55:14 +0000

Political Activism and Agnecy under Austerity and Brexit

Primary Author or Creator

Tom Montgomery

Stephen Richard Wed, 10/06/2021 - 10:55

Additional Author(s) / Creators

Maria Grasso

Alternative Published Date

2019

Category

Economy

Type of Resource

book

Length (Pages, words, minutes etc...)

14pp

Fast Facts

A study of activism against austerity in Britain from the financial crisis of 2008 through the Brexit vote of 2016. It finds that austerity has been a key factor in creating new dividing lines in British society and intensifying old divisions.

More details

A distinctive and original analysis of how the politics of the UK and the lives of British citizens have evolved in the first decades of the twenty-first century, this book provides an interdisciplinary critical examination of the roots, ideology and consequences of austerity politics, the Brexit vote and the rise of populist politics in Britain. Bringing together case studies and perspectives from an array of international researchers across the social sciences, it dissects the ways that the UK has become increasingly contested with profound differences of geography, generation, gender, 'race' and class, and considers agency as a key concept to understand the links between austerity and Brexit.

pp 45-58 in: Contested Britain: Brexit, Austerity and Agency

edited by Marius Guderjan and Hugh Mackay

Resource Address (URL)

https://uk.bookshop.org/books/contested-britain-brexit-austerity-and-agency/978…

Keywords

Austerity

Political participation

Language English