Where does Scotland’s wealth go?

Where does Scotland’s wealth go (if it doesn’t stay here)?

Big Wealth Gap

Click to enlarge

It’s a simple question but not one often asked, probably as most economics bloggers like myself get bogged down in numbers and over complicate the issue.

Data from the UK Government’s Office for National Statistics demonstrates in simple terms the distribution of personal wealth in the UK. It is clear to see that London and the South are by far the wealthiest parts of the UK. Not just the South East but the South West as well.

Clearly the further North you go, the lower the distribution of wealthy households and this matches other research that shows overall lower average household wealth, and lower the average household income in the North.

The map of wealthy household distribution shows a clear North/South wealth divide within England itself which many of us knew about, but many will be surprised at just how far south the divide sits.  Without over complicating the issue this data when taken will all other wealth and income statistics that look at wealth / income distribution within the UK confirms that wealth is centralised around London.  The more northern areas of the UK have suffered years of de-industrialisation, high unemployment and lower investment that followed the emergence of London centric finance and service-led economic policy under consecutive Conservative and New Labour governments.

No surprises there then!  However, when you compare the map of where the wealth ends up with a map of where the UK’s wealth is generated, they don’t tell the same story.  The union drains wealth from Scotland.

Wealth Creation in the UK

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The second map (Eurostat Regional GDP per capita) shows clearly that, in terms of wealth per head, the Scottish central belt generates as much wealth as much of London and the South. Also Scotland’s North East is (perhaps not surprisingly) one of the best performing economic areas in the UK.Now look again at the first map and ask yourself  “Why doesn’t Scotland’s wealth stay in Scotland’?

It becomes clear that we are only better together if you believe that London is entitled to the lions share of Scotland’s wealth.The Jimmy Reid Foundation, a new and increasingly well respected think-tank, published a report in June 2013 demonstrating this wealth drain and the resulting under-performance of Scotland’s economy. It highlighted that Scotland’s economy would be 25% larger than it is today in the absence of the historic and present union wealth drain.

A month earlier, I made the same point on this blog when I wrote about Scotland’s economy going south.

London is Bleeding Scotland DryIt is an accepted fact that every year for 30 years Scotland has generated more tax revenue per head for the UK treasury than the rest of the UK.  The latest figures taken from the Government Expenditure and revenue report Scotland (GERS) state that Scotland generated £800 more in tax per person than the UK average. Scotland would have been £8.3 billion better off than the UK over the past 5 years.

Put simply, when the UK runs a surplus Scotland contributes more to the surplus, and when the UK runs a deficit Scotland has to pay more of the debt back than it is responsible for. Its a “lose/lose” situation for Scottish tax payers and especially for those in need of support from the state.

Often attributed to Aristotle:

You can judge a nation by the way it treats its most vulnerable citizens.

Instead of understanding and reacting to the root cause of the problem we now have a culture of scapegoating the poor, unemployed, disabled, infirm and especially immigrants rising to the top of a political agenda which is dominated by the London and South of England establishment.

So lets consider three key vulnerable groups that the Scottish Government could help if we did not give away so much of our budget every year around £4.1bn drained away on debt interest last year year alone!

1) The poor
Whilst according to the Times,1 in 29 Londoners are dollar millionaires, 29% of Scots live in fuel poverty according to the latest research.

2) Children
In some areas in Scotland more than1 in 3 children grow up in poverty (1 in 5 across the nation as a whole). The charity ‘Child Poverty in Scotland’ says that with Scotland’s undoubted wealth, this statistic is a scandal. There is no reason why our child poverty rates should be so much higher than in many other European countries.  In Denmark and Norway less than 10% of children live in poverty.

Life Expectancy in UK

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3) Old people

According the UK Life Expectancy figures (see 3rd map), the impact of the unfair distribution of wealth under the Union combined with unemployment caused by deindustrialisation means that people who live in Scotland are dying earlier than those from the wealthiest parts of the UK.

For example, the male life expectancy Scotland is 75 versus 79 in the English South East. Possibly more worryingly healthy life expectancy in Scotland is only 59.5.

This causes two big problems. First, health care costs in Scotland become higher than the rest of the UK and secondly Scots who pay the same percentage of their wages towards pensions all their working lives will get up to six years less pension.

So as well as subsidising the rest of the UK during their working lives they do so again in death.

Because people are living far longer in the heavily populated South East, the state pension age is already due to increase to 67 by 2028 and future rises in the state pension age would remain linked to improvements in life expectancy. Asking your average Scottish man or woman to work seven years longer than his healthily life expectancy is asking a bit much.

Indeed, last year, the charity director of Age UK, Michelle Mitchell said:

“We would not support an automatic increase linked to average life expectancy as there are huge disparities in life expectancy across the country and between different groups.”

But it is happening anyway!

Note:  There are only three small areas of the UK where the average person is expected to live over 82  years(dark green on the map), they are Kensington, Westminster and Chelsea.

Conclusion

David Cameron is fond of saying that we are STRONGER, SAFER, RICHER, and FAIRER…TOGETHER.

But clearly that’s only if you live outside Scotland and particularly if you are from the South of England!  Scotland itself is clearly weaker, less safe, poorer, and less fair as part of the Union.

How does a political and economic system that drains billions in revenues from Scotland and leaves the poor unable to heat their homes make us better together?  The current Westminster system leaves many Scots children in poverty and growing up in a culture of hopelessness. It leaves our nation’s families comparatively poorer despite the fact that we generate more tax revenue per head that the rest of the UK.

How can anyone justly claim that is worth fighting for? But then maybe that is why the No camp does not actually campaign on the economic and social record of the Westminster system but rather campaign against independence and, by extension, against the hopes and aspirations of those of us that see independence not as an end in itself but a means to an end whereby we build a stronger, safer, richer, fairer and all round better Scotland.

We can build a Scotland which gets the best of both worlds from remaining in partnership with our friends across the British Isles in areas where we share mutual interests, but most importantly being able to shape our own economic future and maximise our own resources to benefit more Scots today and in generations to come through self government.

Join Business for Scotland – Read More

You may also like: The ACCOUNTING TRICK that Hides Scotland’s Wealth.

 

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Category: Business for Scotland, Economic Policies, Economics of Independence, Fairness, More than 20k Likes, Prosperity, Scotland's Economy

About the Author ()

Gordon MacIntyre-Kemp is the Chief Executive of Business for Scotland. Also the owner of the social media and sales & marketing consultancy Intelligise and was the founding member of Business for Scotland. With a degree in business and economics, Gordon has worked as an economic development planning professional, and in marketing roles specialising in pricing modelling and promotional evaluation for global companies (including P&G). Gordon benefits (not suffers) from dyslexia, and is a proponent of the emerging new school of economic thinking. Gordon Blogs for Business for Scotland and The Huffington Post.

Comments (93)

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  1. Anne Lawrie says:

    Brilliant article, Gordon. Thank you. It would be useful to have this printed as a leaflet, so us grass-roots foot-soldiers could hand it out & put it through letter boxes! So clear & easy to understand. I am going to forward it to fence-sitting friends!
    Come Independence, would you consider being a politician? Scotland so needs people like you! Keep up the good work!

    • Gordon MacIntyre-Kemp says:

      We already have a colour leaflet on this and will be making it available to print off vial dropbox but a cheaper more simpler version is in the offing. Also I think CEO of business lobbying group is where I seem to be able to do the most good.

  2. Tom Rowe says:

    Leaving one union to integrate into a bigger, uglier one. What kind of indpendence is that? Scotland leaving the UK is not the answer. The UK leaving the EU, and the UK working together to get our true independence and self government back. That is the answer.

    • Eric McLean says:

      Tom,

      We are already in the EU. Just that our voice is barely heard since its via Westminster. We’d be represented better as an independent nation.

      UK working to take us out of the EU and continuing to take us for a ride? This is what you advocate? :)

      No thanks.

  3. am says:

    Would independence mean that a greater than current percentage of GDP would be spent on benefits and the NHS.

    Would tax rises be required to pay for that increase if the answer to the above is yes.

  4. LORAINE COX says:

    Excellent factual report….Glad i looked for it….Thankyou…..Sharing wildly…for Scotland’s sake.

  5. Michael says:

    Interesting article, it makes good reading and sheds more light than any of the MSP’s seem to babble on about at Holyrood. But coming from the younger generation (no disrespect, I’m not saying you’re all old) We know its not a vote for the SNP, but to be completely honest with you, most of us don’t trust anyone in that parliament to take us forward. Forgive my naivety in this, but there is nobody who has any presence and sense of leadership to us since the likes of Donald Dewar. The SNP know that. And so do the other party leaders, who, in a direct(and calculated)way use this not by shouting, but by whispering “that’s who you’re stuck with”. I know numerous people who go on and on about how not voting yes is somehow backstabbing our country, when simply, they’re spouting random facts that are pumped out that all seem like they’ve sat down, watched Braveheart and went “to hell with this”. I just want what is best for my family, yet I can’t help feeling a little duped (not by number’s, your statistics show that), but by coincidently having extra money put into health/fitness/sports in the year we have the Commonwealth Games to hopefully generate a buzz if Scotland win some medals or letting 16 year old’s vote for the first time ever. I’ve spoken to my niece about what she and her friends are being shown and taught about the vote and how much they actually know, and its frightening.

    • Greynag says:

      What the Donald Dewar who along with Blair readjusted the maritime border with England to try and rob Scotland of the Argyle oilfield and 6 others?

  6. frank connor says:

    What about our oap/civil service pensions if we dont want any thing to do with english government

    • I’m Scottish and in Dublin and of course I sill get my Civil Service pension. it’s your pension no matter where you live. Same for the many Irish citizens who worked in the UK Civil Service or who paid UK contributions.

      • Raymund Lynch says:

        Mysister-in-law who lives in Donegal, Ireland, still gets her British widows pension through my deceased brother’s contributions,who was Scottish.

    • Alison says:

      We all pay for our state pension throughout our working life, but it is not paid into a fund, the government uses this income in part to pay for ongoing state pensions. This is why an aging population causes a big headache for the government . The current workforce pays for the state pension paid to pensioners.

  7. Emma says:

    Where are the headquarters, shareholders and owners based for the companies employing people in the cities where there are higher salaries? The South, hence the blue map showing millionaires concentrated in this area. BP may have an office in Aberdeen and employ staff on a good wage but the headquarters are in London. How will independence change that?

    • Gordon MacIntyre-Kemp says:

      The simple question we should be asking is why is BP headquartered in London? Why is Diageo a group that generates 60% of its profits from Whisky – or Oil and Gas UK the industry body headquartered in London?

      if the Scottish government is the seat of power for those industries then they will want to be close to the seat of power – and maybe a 3% corporation tax cut will encourage then (to pay it as well as locate here).

      • Dean says:

        You say ‘Diageo generates 60% of its profits from Whisky’. Are you sure your figure is right?

        Interactive Investor says Scotch sales account for only 29% of Diageo’s revenues (http://ow.ly/shAhl ).

        If the latter figure is correct, maybe Diageo’s HQ should remain in a global centre of commerce – one with world-class marketing and advertising expertise – rather than move to a Scottish city.

        Keep making your wonderful whiskies and let us Londoners sell it for you.

        • Callum says:

          The point is that Scottish cities and English ones from the midlands north from that matter have been hamstrung in developing themselves due to Londoncentric investment. If diageo moved there headquarters to Glasgow there would be demand for world class marketing and advertising to develop in the area as well, heck we might even see a stream of people moving north rather than the relentless brain drain south that continues to suck the life out of this country…

        • Greynag says:

          Dean,

          I was a Country Manager with Diageo for 30 years and I am also a Scot. The Diageo ethos is to make decisions as close to the market as possible. “Think global act local”. It doesn’t matter what nationality you are!
          They are influenced by operating as economically as possible hence the move of their International Export/Customer Interface Centre to Amsterdam from Glasgow in 2000.
          As Ivan Menenzes, the CEO, has stated their biggest concern is not Scottish Independence but remaining in the EU.

          • Gordon MacIntyre-Kemp says:

            Reminds me of my time at P&G we had the mantra that decisions were best made by those closest to the problems as they were best placed to select the right solutions and drive the company forward. Independence is just this sort of thinking on a national scale.

        • Daniel says:

          Remember Diageo’s vodka production for the UK is also in Scotland.

          But they pay most of their tax under their headquarters in London. The Kilmarnock plant of Johnny Walker produced close to £1Bn in duty in its final year (despite being dreadfully inefficient)

          That tax all looks like London money, where in reality it was all Scottish.

    • Allan says:

      A majority of shares in BP are owned outside of the UK so the “shareholders and owners” are clearly not London-based. The fact that “the headquarters are in London” is not a preference for that office to be in the South-East, rather it reflects a company history that pre-dates the discovery of hydrocarbons in the North Sea basin. It could quite easily operate from Edinburgh (e.g. Cairn Energy) but the company was founded by investors in London. The “office in Aberdeen” is the headquarters of BP Exploration in the North Sea. Most large oil companies operate regional E&P offices such as this and most have the headquarters of their UK interests (i.e. North Sea oil and gas) in Aberdeen (e.g. Chevron, Total S.A., ConocoPhillips, Maersk Oil….). An exception to this trend is BG Group who operate in Reading with a centralised E&P model that has a majority of their technical staff based at headquarters working on BG interests all over the world with support from regional offices. Independence would place a significant portion of BG’s interests in (to them) foreign waters and I would speculate that a prominent office in, or even a relocation to Aberdeen may be attractive to them in that case but I would add that I am not an economist and don’t know the relative benefits/drawbacks for those options.

      The point I have been building towards is that where the global headquarters of these companies is located doesn’t really matter, but at the moment corporate tax from oil and gas in the UK (28% of the UK total in 2008) heads to Westminster, whereas in an independent Scotland a large majority of that percentage would instead be heading to Edinburgh without being diluted as it is now.

      http://www.bp.com/en/global/corporate/investors/share-information/ownership-statistics.html)
      http://www.cairnenergy.com
      http://www.bg-group.com
      http://www.aberdeencity.gov.uk/nmsruntime/saveasdialog.asp?lID=30832&sID=3365

    • Raymund Lynch says:

      While we were on holiday during July 2012 I met an ex patriot Scot, who works with the Amecian Government, in charge of Commodities.She informed me that the headquarters for commodities must be in the country where the commodities originate.Obviously this is commonly understood by Industry, it is the norm.

  8. T Farooq says:

    Very impressed with the article, i lived in Dundee for 5 years after moving from London, as an immigrant i preferred Scotland over London as the quality of life was much better the atmosphere, the people, the house rents etc,
    I do not see ONE reason why Scotland should remain in union, think about it, Scotland got Oil, Agricultural Land, Tourism industry, Peace, and most of all world’s largest exports of Scotch Whiskey,
    only thing they dont have is a Central Bank, and thats all what south is blackmailing Scotland to stay in union. im sure in start it will be difficult if Scots get independence but in the long run will be happier than this monarchy

  9. Chas Gray says:

    Very interesting, can you shed some light on this question that I have been asking both sides and never been given an answer. As an ex member of HM Forces I’m due a full pension at some point and I’m in receipt of a war pension just now. I’m Scottish living in Scotland and leaning more and more to the yes side. What will happen to my Millaty pension, who will pay it. Its all I have to rely on and im pretty sure there are thousands more in the same boat as me

    • Malcolm Wadia says:

      Hi Chas,
      I’m surprised you haven’t got an answer as it seems an easy one to me.

      Similar to the question above, your pension is a contract between you, as an individual, and HM Armed Forces. It does not depend on where you live (you could retire to Spain if you chose) or your nationality (HM Forces employ personel from Ireland and the Commonwealth too).

      It therefore seems exceedingly unlikely that independence will make any difference to your pension arrangements.

      • Geordie says:

        I’ve recently left the armed Forces and am in receipt of a pension paid by the UK Govt. The SNP propose to take this over and keep paying it. My main worry is that they will not have the same methods in place to do so and that in future years if everything goes wrong they may be unable to do so.

        I have sought answers to the question of can I just remain being paid by the UK government, so far I’ve not had any. This is a big concern as it makes up nearly half of my income now.

        • tartanfever says:

          Geordie,

          The UK govt. will pay your pension and continue to do so.

          As pointed out above, it doesn’t matter where you live, your contract is between you and the MOD. If you live in Spain, an independent country, you still receive a pension.

          The country you live in has absolutely no bearing on your pension. When you signed up and served, your contract was made with the Westminster government, no-one else, they will continue to pay your pension.

    • John Roland says:

      Chas, an uncle of mine has made his home in Penang, Malaysia. He draws his Military pension there.

      • Callum says:

        All these Spain and Malaysia examples are irrelevant. If assets and liabilities are split, then there is a chance the military pension liabilities would be inherited by the Scottish government – as they themselves have said in their independence document.

        Post hypothetical independence, you could move to Scotland and still receive your UK pension as you do with any other country, but not necessarily now.

  10. C Moore says:

    Congratulations on this piece. I think the debate on independance needs to be simpler so more of us can understand and vote accordingly – your blog may be the answer to this call.

    Could someone offer a statement on what will happen when our crude oil runs out? What impact will this have on our wealth generation and can wind power replace it? Sometimes I fear the weath argument is shortsighted because we won’t always have oil and the economic prosperity is currently brings.

    • Gordon MacIntyre-Kemp says:

      Brent crude according to the industry has a 40-60 year pro ducting life in the North Sea.

      According to the industry body UK Oil and Gas (London headquartered) 40% of Corporation tax from North Sea companies paid to treasury was related to selling expertise and exploration services abroad and not simply just related to the North Sea.

      According to PWC £340bn of Gov revenue has already come from the North sea but that theres is £450bn still to come.

      Oil will eventually run out the question is what plans do westminster have to reinvest in Scotland and in particular the North East to get us ready for that time? the answer is none and they have been widely criticised for not seeing up an oil fund to reinvest in the future as Norway have done and as the Scottish government will do.

      The Scottish Gov plans to reinvest the oil monies in Scotland and not in subsidising the failing UK economy. They have a plan of re-indsutrialising Scotland in renewables and life sciences and making the adjustments required to keep our economy going as the North Sea revenues slow down.

      The longer term plan is with the Yes side and the Scottish government and the failure to plan and therefore the plan to fail is with a No vote and the distant disinterested Westminster government.

      • colin says:

        A distinction worth noting is that oil won’t actually ‘run out’, it will simply become unprofitable to extract any more. In other words, the cost of extraction will be a price higher than anyone will be willing to pay.

        No-one can say for sure when prices will reach that point, but oil prices have been high and volatile since 2008.

        Regardless of independence, the Scottish Government is right to invest in renewables technology where the coat is coming down year on year. For example, solar cost $72 per watt in 1972, yet it’s only $1 today.

        • Simon says:

          I find it interesting that with all the engineering and offshore expertise in Aberdeen, the Scottish government decided that Glasgow should be the center of excellence for renewables. Personally I think this is evidence that no matter who is in charge, they will always pander to the most populated area.

          I call for independence for Aberdeen, we have all the oil after all ;-)

        • tartanfever says:

          Colin, I’m not sure about that argument.

          One thing that has been a constant throughout history is that if a product is in demand and it becomes scarce, it’s price will rocket.

          As yet we have no large scale alternative to oil for running our cars and machinery and until that happens on a mass, nationwide scale, the demand for oil/petrol will be high. That is decades away.

          The other thing you don’t consider is technological improvements. As technology improves, it invariably becomes cheaper. New technologies also allow you extract from ever tougher environments. So while North Sea may see a decline, the Atlantic is a vast resource. We know oil is there, Shell found it decades ago.

          I do however totally agree that renewables are the future and that an oil fund should generate capital to invest in this sector.

      • Raymund Lynch says:

        Sir Ian Wood CBE, is at present coordinating the North sea oilriggs, around 40 of them. His coordination is about more efficient use of the various companies, equipment, in order that as a whole the oil companies will be more financially efficient. He has stated that there will be £200 billion pounds mined by 2020. The overall value of North sea oil is 1.3 trillion pounds. This should be adequate for a reasonable government back up fund, being kept for future needs.

        In addition President Obama has estimated the world wide green energy industry is worth 6.3 trillion. Scotland at present has 25% of European green energy. Although the life time expectancy of the present Scottish generating equipment is less than initially expected, we must realise that this industry is in a certain sense at it’s infancy and I’m sure more cost efficient methods will be discovered and delivered.

  11. Kester Park says:

    A late question: are your tax/spending gap figures based on oil revenue being divided geographically or per capita?

    If the former, is it a legitimate assumption that a putative independent Scotland would get the geographical proportion of its remaining oil reserves?

  12. Brian Bunce says:

    If we are such a burden and take more out of the kitty than we put in why does the English government want us in the union ? I will be voting yes for independence not snp. If the yes vote wins I will look at what’s on offer as a government by all parties and give my X accordingly , and i will know my destiny and my family’s future will be looked after by a government that we voted for and not another government in another country

  13. ellen stewart says:

    Good piece of work, and sound replies to questions asked, wish this was in a national newspaper, everyone should see it

    • Frederick Robinson says:

      I agree it’s a good piece of work, but take issue with the economic grounds suggested for lower life expectancy. Born and brought up in England, I moved to Scotland to work in 1966, moving back in 1996, largely on health grounds. In 1992, aged 52 (not far below the 59 years mentioned), I suffered a two-year paralytic stroke. Why? Well, I was admittedly not living in the lap of luxury, but more significantly, the winter of that year produced temperatures 15 degrees below zero. It’s BLOODY COLD in Scotland! (Though ironically, in the BLAZING summer of 1976, tarmac melted on Glasgow roads; and in 1984-5, I left Glasgow with a thin frost and, by coach, reached my Barcelona destination amid 3 feet of snow).

  14. lee fisher says:

    I like this mans arguments for Scottish independence very compelling, I Agree with him And I’m ENGLISH as long as your parliament does not become a corrupt, self serving Elite for the corporations that lives off the 99% you’ll be no worse off than you are now, whish this guy spoke for us, All the best wishes with your endeavours.

    • Gordon MacIntyre-Kemp says:

      Hi Lee just thought you might find it amusing that the blog was written in my home town of Hexham in Northumberland as was todays on oil funds as I am back here visiting my family every two to three weeks. You comment may just help people to understand that it is not about England and Scotland or Labour V SNP its about a system of government that is not fit for purpose, and moving to a better system and a better partnership between home nations that will in the end benefit everyone.

      • Yvonne says:

        I totally agree with everything you have said and would wish to remind people that we fought for independance and were an independant nation for 500 years before we were signed into the United Kingdom, we are and will always be second class citizens to England and unless we get some fire in our bellies and get the facts out there we are never going to have a bright future for our children and our country, David Cameron has yet to commit to a debate this says it all. We are a very patriotic nation, why are we holding on to a dream of a United Kingdom, we are not united in Westminster and this is where it matters, I only feel sorry for the north of England who I consider our good neighbours being left in an England that is also failing them.. Yvonne

  15. Dave McEwan Hill says:

    Good stuff but could you please call it the Scottish National Party, not the Scottish “Nationalist” Party.
    We need very simple and easy to understand facts like – what small percent of Scotland’s revenues are needed to fund state pensions as many of our old folk think this is a huge sum of money required and that this is in some big pension pot down south.

  16. Gerry Devine says:

    I have been anxiously waiting for this type of information to come to hand. We ( the yes supporters ) need to stand up and be counted and shout this from the rooftops. I believe that many Scots are not sure of the facts and this information may arouse their desire to know more. If we stand back and do nothing our opportunity to govern our own country could be lost.

  17. The ONS graphic depicting wealth concentration, is the best example I have seen for the old saying ‘a picture speaks a thousand words’. Its an excellent illustration those voters left in any doubt as to whether Scotland is getting a fair deal from the Union. The consequences for Scotland by remaining the disadvantaged member of an economically abusive union are, at best, more of the same, or at worst an acceleration of the wealth siphon from north to south. A harbinger of what’s to come is there for all to see in England’s over 50 billion High Speed Rail infrastructure project, of which Scotland will see no benefit but will be paying £5 billion towards.
    How would you feel, if you’re neighbour down the street was getting his garden landscaped and asked you to pay for it, while you were scrimping to save up for your roof repair! Looking at the issue in that context, I feel, can often bring things a little more into perspective.

  18. Andrea says:

    So with cheaper prescription charges and free higher education, you think Scotland is still in a worse position than the rest of the UK. I don’t see how independence is going to resolve these when the scots are already better off than those in the south.

    • Gordon MacIntyre-Kemp says:

      “Cheaper prescription charges and free higher education” Andrea you can add to that frozen council tax and free bus passes for the elderly, Scottish Water and the Scottish NHS not being privatised and quite a lot more – ALL of these are a result of devolution. All of these are under threat from the unionist parties not just the Tories but Labour have said they don’t support these policies, and a future Labour government in Scotland would reverse these policies.

      Ah but the NHS would be safe – well no. Scotland’s budget is set as a % of spend in England’s, so if the NHS in England continues to be privatised at the same rate as under both Labour and Conservative / LibDem Governments then the budget to run the NHS is Scotland will be cut as they spend less on it in England. In the long run England will have an NHS that is more expensive for the poor and not fit for purpose and we will be forced to make cuts in Scotland if we vote No

      Devolution is independence light and is almost universally accepted as having been good for Scotland – what if we had all the powers of an independent nation? What could we achieve then? The only doubt can be if we can afford it, but remember that last year £4.1bn was removed from Scotland’s budget to pay interest on the UK’s debts over the last 20 years that amount has been over £70bn. Scotland subsidises the rUK, £824 per head last year. So yes the Scottish government has been very competent on issue such as tuition fees and Council Tax but with full economic powers and Scotland’s extra tax revenue available to the Scottish people we could do so much more, almost regardless of what political party was in charge.

    • John Swapp says:

      Andrea, with such a poor health record in Scotland, people dying around 5 years earlier on average, compared to their Southern UK counterparts, food banks; 25% of children living in “official poverty”; how are we better off ?

      • Frederick Robinson says:

        To add to John Swapp’s comment, see my Comment higher up about the effect of climate/temperature on health.

  19. Graeme McCormick says:

    This should be included in ambassadors’ presentations.

    O/T can we get major supermarkets’ reaction to UK government setting up border controls post independence and how will this effect their profitability given their disproportionate activity in Scotland?

    • Gordon MacIntyre-Kemp says:

      I am writing a blog on the No Campaign’s ridiculous position on borders this week and yes any trade barriers (illegal under EU law anyway) would means billions in lost trade for rUK head quartered business who export four thousand million pounds worth of goods and services to Scotland per month.

      • I agree Gordon, It becomes more and more difficult to see the integrity of No Camp arguments in relation to issues around borders. Clearly any Rump UK ‘barriers’ trade or otherwise would hurt all parties concerned. Setting aside, for one moment, the illegality of any such move under EU law.
        It seems the No campaign will, in the absence of any legitimate or factually sound argument, resort to scaremongering and sowing seeds of doubt with nothing to substantiate or corroborate their claims. The business community I’m sure will explode these malicious myths over the course of the next 12 or so months. The bottom line is usually a fair persuader.

  20. Carol Ann Moore says:

    Excellent article,more facts like these need
    to be seen,so that people understand what is really
    happening to Scotlands revenue.

  21. Steve says:

    Interesting post, however, like all these for & against statements they only tell you the bits they want. Run these numbers without the Oil revenue. What is the Income Tax generated and what is the Benefits bill. How must do we generate from Road Tax and what do we spend on road maintenance? Let’s have all the figures and see what the reel picture looks like

    • Gordon MacIntyre-Kemp says:

      Why would you run the figures without oil???? That doesn’t compute! The oil is there and its in SCottish waters its part of the economy of an independent Scotland and its thought to have between 40 and 60 years commercial life left according to industry figures. Long enough to reinvest in the future rather than suffer years more of under investment and wait for it to run out without a new plan to re-indutrsialise Scotland through renewables and biotech. Vote no and we are just waiting for the lights to go out on Scotland, vote yes and we see a new dawn in renewables and added value industrial technologies to future proof our economy. Scotland has 26% of the whole of the EU’s renewable potential – we got lucky a second time lets not blow it!

      Oh wait a minute I think you are on to something I just ran the figures for London without the finance industry and they are bankrupt!!!

      You cant take oil out of Scotland’s economy it is a fact of Scotland’s economy but even if you did you would find it is almost exactly the same per person in terms of GDP as the rUK.

      Oh and social spending in Scotland is a lower % of GDP than it is in England – go figure – but the best way to get the benefits bill is to grow the economy using the economic levers independence would bring and get people off benefits and back to work in a faster growing economy.

  22. Michael Mcaree says:

    In all my 69 years I’ve asked myself could my standard of living been better and I always think yes. Now I know why. Thank you G M K.

    • Gordon MacIntyre-Kemp says:

      I like to think that my articles make people ask the question, “is there a better way to run our economy”, cold our country be wealthier, fairer, a better place to live and work” and the answer seems to be yes for most people who stop and think about it.

      Thanks Michael

      The article above demonstrates just a few of the economic measures that are effected by the lack of self determination and the Blue map shows the wealth drain in terms of wealthiest families but the life expectancy map shows the impact of the wealth drain amongst the working classes.

      This blog How Scotland’s economy went South explains the economic decision process that led to this state of affairs. http://www.businessforscotland.co.uk/how-scotlands-economy-went-south/

  23. Gerry Gill says:

    Hey, come on! Everyone knows the Scots are subsidy junkies, lazy, stingy .. oh, yes, and the winging Jocks. (Except, of course, when there’s a war on, when we become the Fighting Jocks.)

    Seriously, a great article – but in a situation where the the London media, Westminster and the Union Jocks are now in full anti-independence Rottweiler mode and determined by fair means or foul to do our country down, those hard facts will never be mainstreamed.

    • Hamish Burgess says:

      Of course the Unionist press are not going to publish articles and info like this. It’s up to us to re-post and ask others to do the same, relying on a pyramid effect. We’ve got to make do with what we’ve got – limit resources, determination and the rightful cause. The main thing is never to crumble before these deceivers like Darling.

      • I don’t think there is any doubt that if the electorate had all the economic facts a Yes vote would be inevitable, however as you alluded to Hamish broadcasting is a ‘reserved’ matter, i.e London control the media and state Media in particular in the shape of the BBC have a vested interest in maintaining the union. A question that every Scot should be asking every time they switch on BBC news should be better together… for who? You can expect more spin and selective reporting, probably even news blackouts of facts damaging to the No campaign. We have already seen this, take the Dennis Heally interview for Hollyrood magazine which was brushed under the carpet as it included Heally’s admission of Labour collusion in the cover up to bury Gavin McCrone’s report on the economic impact of North Sea oil for Scotland’s economy in the 70s. Fast forward to today, their approach even as recently as last week was duplicitous over Oil and Gas, saying one thing to the public and another to the industry, indefensible, some would say treacherous.
        Social media is a key channel in delivering the facts, lets hope we can circulate the facts to as many voters as possible in order that they can make a truly informed decision on polling day. We have a duty to share concise fact based articles such as Gordon’s as we cannot rely on any notion of impartiality while London continues to keep a stranglehold over mainstream broadcast media.

  24. Well done Gordon. Another well researched and well written article. Each one makes the case for independence more compelling.

  25. Kevin says:

    “The latest figures taken from the Government Expenditure and revenue report Scotland (GERS) state that Scotland generated 9.9% of the UK’s tax revenue but received only 9.3% of spending.”

    9.9% of UK taxation = £56.9 billion and 9.3% of UK spending is £64.5 billion. Scotland ran a deficit and was propped up by the UK exchequer.

    UK economic security has ultimately secured the Scottish economy.

    Your blog here is misleading and inaccurate.

    (Revised Comment, £64 billion in UK spending)

    • Gordon MacIntyre-Kemp says:

      Kevin

      Your comments here are misleading and inaccurate.

      You say Scotland is propped up by the UK exchequer. I don’t think you have thought through the 9.9% V 9.3% statistics. First of all in economic conditions such as have been experienced since the global finance crises began almost every major industrialised nation has run a deficit – even Germany!

      If the UK treasury borrows (for ease of calculation) £10million and spends 9.3% of it in Scotland, then we get £930,000 pounds to spend. However as we have every year for thirty years generated more tax per head the rest of the UK (9.9% last year) then when it comes to paying that debt back we have to pay back 9.9% of it so we borrow £930,000 and pay back £990,000 (before interest).

      So for every £10m the UK Government borrows Scotland is £60,000 worse off, not better off – well UK debt is over a trillion and growing and thats is a lot of £60,000′s.

      Over the last 19 years (using figures accepted by the No campaign) Scotland would have been in surplus by £69bn (sixty nine thousand million). Compare this to our population share of the UK debt (the amount we would inherit as an independent nation (by my calculation at time of independence) could be around £100bn. Our population is 8.4% of UK so we would inherit a lot less of the UK debt as an independent nation (8.4%) than we would have to pay back if we vote NO (9.9%) – ipso facto a no vote costs the Scottish tax payer £1.4bn+ in debt repayments.

      Now people also say but Scotland is in deficit (as is almost every other nation on earth) – well yes but do you know that almost 59% of Scotland’s deficit (£4.1bn) was our share of the interest payments on the UK debt (not debt repayments just interest on that debt)? If you also were to take out the military spend that the Scottish population wouldn’t incur as an independent nation (nuclear weapons / illegal wars) then we would be able to take out another 20-25% of our deficit. Our deficit is a smaller % of GDP 5% than the UK’s 7% so we would be able to pay back our debts earlier if we chose to do so as an independent nation.

      The UK level of net debt as a percentage of GDP is approximately 83% ranking the UK the 181st worst nation (out of 203) in terms of how indebted our economy is. Norway which provides a good benchmark for Scotland as an independent country is currently the lest indebted nation in the worked with debts as a net % of GDP at at amazing -165.508%. Far from underpinning or subsidising Scotland the UK Treasury is using Scotland as a cash cow (apparently Cornwall as well according to other comments on this blog!).

      The UK is in deficit and has generated debts in the trillions have a look at this its quite interesting http://www.debtbombshell.com/widget.htm.

      Your conclusion that “UK economic security has ultimately secured the Scottish economy.” is lacking in any credibility at all. It can be factually demonstrated that several generations of “UK economic mismanagement has ultimately undermined the Scottish economy.”

      • David Gisbey says:

        It might be easier for people to digest this point if it was explained in terms of a loan and effective APR. The deficit is being made up but with a loan rather than a gift, as is the rest of the UK. It sounds as though we are being charged a higher effective rate of interest than the rest of the UK, purely because of our higher per capita GDP.

        • Gordon MacIntyre-Kemp says:

          That is a good point David, the claim that Scots are wealthier because the UK government is economically incompetent has run up massive debt and lets us pay more of that debt back than the rest of the UK is clearly ludicrous. Yet unionist politicians and even one commenter here seem to think that because we are given a loan at a higher rate of interest we are wealthier.

          I wonder is this is the same style of thinking that leads people to believe that if they get a loan from Wonga at 2,000% APR they are better off?

          • David Gisbey says:

            That’s one way of looking at it, but I was just thinking of something that most people could relate to and would definitely react to if it was clear that Scotland as a whole were being charged a higher rate than the rest of the UK.

            Here’s my quick attempt at calculating the effective APRs for Scotland and rUK. If I’ve got it right, then the figures are pretty dramatic…

            As I understand it, if the UK Government borrows £100 to cover the current year’s spending, then £9.30 of that is spent in Scotland and the remaining £90.70 is spent in the rest of the UK.
            If after a year, the UK Government has to pay £2 in interest on that £100, then the total debt becomes £102. The tax take is used to pay the interest and reduce the loan if possible, but Scotland’s contribution is typically 9.9%, so if the total UK tax take was exactly enough to pay the loan and the interest at the end of the year, then Scotland will have paid 9.9% of £102, or £10.098.
            So the effective interest charge for a loan of £9.30 for a year is £0.798, which I think comes to 8.58%

            Doing the same calculation for the rest of the UK gives a loan of £90.70 and a repayment of £91.902, so the effective interest charge is £0.202 which is an effective APR of 1.307%

            As I understand it, if the tax take is more or less than the amount required to exactly cover the amount borrowed plus interest then any shortfall is added to next years borrowing, and any excess is used to pay off carried forward debt. Either way, it makes no difference to the effective rate of interest being charged.

          • David Gisbey says:

            I don’t know if it’sthe done thing to be the first to comment on your own comment, but here goes…
            An initial reaction might be that we’re being ripped off, but anyone who is a high earner and pays a lot of tax could easily come to a similar conclusion. I don’t think Scotland as a whole is against the idea of the wealthier/fortunate supporting the poorer/less fortunate. That’s what fairer and more compassionate means.
            I’m thinking now that it might be an easy step to conclude that we only need to be able to borrow as separate nation at less than 7% to be considerably better off.
            rUK would only be slightly worse off, as their effective rate would now be equal to the actual rate rUK is able to borrow at.

    • Lee Johns says:

      Well said Kevin! They all use bluster and bull to hide the true facts.

      • Malcolm Wadia says:

        Ok, Let’s keep this simple.

        Mr Scotland and Mr rUK get a joint credit card. Mr Scotland spends £5 but Mr rUK spends £7.90.

        They share the resulting debt evenly.

        Would Mr Scotland be better off getting his own credit card?

    • Caadfael says:

      Kevin, a certain Mr,Mobius appears to have got into your logic!
      It’s as simple as this … 59.6bn divided by 9.9 = 5.74 recurring.
      Now multiply that by 9.3 = 53.4515r.
      We are therefore cheated out of 6.149bn
      SEEMPLES**

  26. shaun toft says:

    The first graphic is misleading from a Cornish petspective. Cornwall’s lumping into the south west region hides it’s true status as one of Europes poorest regions, easily on a par with Scotland and the North. We have also qualified for European objective 1 funding for over a decade, and only then because Cornish campaigners had to force government to look only at Cornish statistics, and not averaged out stats from across the so called south west region. We have the same problems in Cornwall, and the divide goes from east to west, as well as south to north.

    • Gordon MacIntyre-Kemp says:

      Interesting thanks for the comments and intuitively I felt that was the case.

      The blue map shows the distribution of wealthy households which is only one indicator of wealth distribution. In all other indicators there is evidence that London and south East also over-performs but that does not mean that there is not poverty in those areas as well.

      The sad truth is that where as the wealthy household numbers in the South West as a whole are high the distribution of wealth in our society is such that there may also be poverty, wealth inequality throughout the whole of the UK is also a damaging side effect of the London orthodoxy / neoclassical economic model followed by the unionist parties.

      One of my next blogs will be on wealth inequality and the social economic failings of unequal societies such as the UK.

      • shaun toft says:

        Totally agree that London and the south east are swallowing up the bulk of the wealth, i also am 100% behind the campaign for Scottish independence. Unfortunately the ONS statistics for the south west region always mask Cornwall’s acute problems, one more statistic that may or may not surprise you is that together with the Welsh economy the Cornish economy has a net minus investment of roughly 300 million a year (reaearched by Kevin Cahill), and so far all calls (via Mebyon Kernow) for an explanation from westminster on this policy of fiscal rape have been ignored.

  27. Ron Sturrock says:

    Gordon, the attached shows a better regional breakdown, though nothing graphical about, dry numbers.

    It would be interesting if the same criteria applied to a Scotland only regional graphic..

    http://www.ons.gov.uk/ons/dcp171776_313608.pdf

    Regards

    Ron

  28. Tony Irwin says:

    Hey there! Your first map doesn’t show wealth distribution across the UK, it only shows porportion of millionaires in each region. We can’t infer any of the claims (average household wealth, concentrations of wealth, or even which region is wealthiest) that you make in paragraphs 2, 3 and 4 from this map – you’d need a different kind of map to make those claims. It may just be a HTML linking error to the wrong map – easily done! Best wishes, Tony.

    • Gordon MacIntyre-Kemp says:

      Tony the map is one of many sources of information that prove that the wealth of the UK is concentrated in and around London and the South East, I could provide all the evidence but it would need 10 times the space on the blog and I don’t thank ,many would read it.

      For example from the ONS data link posted by Ron above http://www.ons.gov.uk/ons/dcp171776_313608.pdf

      >>The share of individuals aged 65 or over living in households with net property wealth over £250,000 is 41% in London, 38% in the South East , 32-33% in the East of England and the South West; but only 10-15% in the North East, North West, Yorkshire and The Humber,Scotland and Wales. < <

      So the overheating of the property market in the south means that retired people also have more of a nest egg for their retirement as well as higher wages and a stronger economy to live within during their working lives. Good for them, however the rising property costs lead to rising private rents which means that the poor of London can claim more housing benefit and so the UK as a whole gets a change to housing benefit for a reason that does not exist in Scotland or my home town of Hexham and the rest of the North East of England. Just one of the London led one size fits all policies that add to the drain of wealth from Scotland when it is not merited by the Scottish facts. Why is benefits not a devolved power and still wouldn't be with Devo Max?

      This may be of interest http://reidfoundation.org/portfolio/the-dysfunctional-uk-economy/ The dysfunctional UK economy paper by the Think Tank the Jimmy Reid Foundation.

      • Tony Irwin says:

        Good to hear from you! Good luck with your blog – a lot of my friends are linking to it from Facebook.

        “the map is one of many sources of information that prove that the wealth of the UK is concentrated in and around London and the South East,”

        This particular map does not prove that. You need a different map for that. Hope you’ll consider adjusting your article or finding a better map for your aims.

        Best wishes,

        Tony

        • Gordon MacIntyre-Kemp says:

          Tony if you read the comment you pasted from my blog you will see that its say that it is “one of many sources that prove”. Taken all together the evidence that London and The South East has pulled towards itself wealth, power and population is not actually disputed by anyone.

          Loads of factual evidence in this book http://www.amazon.co.uk/Going-South-Britain-Third-Economy/dp/0230392547 Going South – How the UK will have a Third world economy by 2014.

          However the map I used says it all – personal wealth is concentrated around London and the South East it would be bizarre to suggest otherwise – do you have any evidence to the contrary? I would be amazed!

          Why have so many people concentrated on the blue map the last one points out that Scots die younger and there is a statistically proven link between life expectancy and wealth distribution.

  29. johanna drysdale says:

    Throughout the history of th Union the heavily populated London and home counties have decided who rules and governs the UK. No prizes for working out which areas are given priority by rulers and those who control public spendingj.

  30. orkers says:

    Superb article.

    You have a talent for writing that should, in a fair and just world be expressing itself in the mainstream media. That it is not is indicative of the democratic deficit that exists in modern Scotland.

  31. Eric Williamson says:

    Now you know why England wants Scotland to stay in the UK.

    • wondrinfree says:

      England doesn’t want you. A higher percentage of English people want Scottish independence than Scots do. We are fed up with your constant whingeing. Just go already.

      • Modman says:

        The irony is that if the rUK understood that it would be set to lose out with Scottish independence it might reconsider this type of ignorance. Do the English genuinely believe that they are subsidising Scotland? Get real. Can you imagine the paradox that would occur if the rUK got to vote on Scottish independence? Each campaign would have to prioritise entirely different arguments on each side of the border. The challenge up North is in attempting to convince people to trust that we don’t in fact rely on rUK. Yet it is the ignorance of those South of the border who believe that Scotland is a leech that ironically would swing the vote in our favour. Too bad that the rUK don’t vote on this matter; we would romp home to victory.

  32. Dick Winchester says:

    Don’t forget Gordon that due to decades of underinvestment in Scottish industry, the low level of R&D support compared to our competitors and Westminster’s appalling laissez faire approach to company ownership, enormous chunks of wealth generated in Scotland are remitted overseas on an annual basis.

    For example, courtesy of Prof Brian Ashcroft we know that in the oil and gas sector this amounts to around £18bn or 70% of all post tax profits!

    That’s a very serious amount of wealth that Scotland loses due to the UK’s lack of a sensible industrial strategy and political dogma.

  33. Lisa Scott says:

    Enjoyed the article and if allof the content is 100% correct,count me in as a supporter.

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