Economic Guardrails – Why we need Recovery First for Scotland’s economy

The First Minister and Finance Minister must be truthful with the people of Scotland about the looming economic catastrophe Indyref2 would deliver during our recovery from this pandemic.

We have never experienced a lockdown economy before, and our recovery from the Covid19 pandemic will not follow the traditional post-recession recovery pattern we saw following the 2008 banking crisis. In fact, there is still significant debate between economists as to how the recovery will take shape. We find ourselves in a very different landscape.

Scotland’s future and Scotland’s prosperity lies in leading, not leaving, the UK. This May we must vote to put recovery first for Scotland.

2020 saw a ‘yo-yo’ effect on GDP. Scotland had a small drop in the first quarter of -2.5 per cent, followed by a massive drop in the second quarter of -19.4 per cent. We then had a rebound of 16.0 per cent in real terms during the third quarter and a smaller 2.0 per cent rebound in the fourth quarter as lockdown measures were eased. Compared to the third and fourth quarters of 2019, that represents significant falls of -9.5 per cent and -6.5 per cent respectively (National Statistics publication for Scotland). Projections for the first quarter of 2021 with Covid restrictions in place suggest another significant hit to GDP growth for Scotland.

We know before seeing the full scale of the pandemic that Scotland’s unemployment rate is the worst of all the four home nations (ONS 06/20). Scottish unemployment levels registered a slight drop in quarter four, but I’d expect, especially given the job losses in hospitality and retail, that this will rise again.

Let’s take a progressive example from our sister party. Canada’s Finance Minister, Chrystia Freedland, announced in her autumn statement that it’s essential for the government to inject fiscal stimulus in 2021, 2022 and 2023. Essentially, the road to recovery from this pandemic will be a lengthy process that needs diligent management. This makes manoeuvres for an Indyref2 bill to be introduced in 2021 not only premature but downright dangerous.

The Finance Minister should be focused on Scotland’s output gap. We know the economy is performing far below where it should be, so how do we close that gap?

If you look at proposals from the Scottish Liberal Democrats, we have the priorities in place to do this. If you want the biggest bang for your buck to get the economy moving as quickly as possible, typically you focus on giving aid where it’s most likely to be spent. That means providing spending power to the recently unemployed or people living below the poverty line. This is how the introduction of a universal basic income (UBI) could steer Scotland’s recovery.

The Liberal Democrats want to see UBI introduced throughout the UK, but if elected in May I will push for Glasgow to be the first UK city to trial UBI, not only because of the severe job losses in our hospitality and retail sectors but also to provide a real solution to ending child poverty. Child Poverty in Glasgow Kelvin currently stands at 41 per cent as calculated by the End Child Poverty coalition. That’s a shocking statistic, which shames the SNP administrations at both Holyrood and Glasgow City Council.

For those in the SNP and Scottish Greens who will no doubt suggest the stimulus needed could be driven in a post-independent Scotland, I’m afraid the numbers just don’t stack up.

The latest GERS (Government Expenditure and Revenue Scotland) figures reveal a pre-Covid-19 £15.1bn spending gap in Scotland between taxes raised and what is spent on public services. Scotland leaving the UK risks leaving a £15 billion gap (to put that in perspective, that’s more than Scotland’s annual NHS spend for 2019/20) if the new state can’t borrow to replace that funding. Plus, the Institute for Fiscal Studies review of the SNP’s Sustainable Growth Commission report (a report designed to give the economic case for separation) concluded spending on public services and benefits would fall by 4 per cent of GDP over the first decade of independence if the plan were introduced. Austerity like this would cripple recovery and push further hardships on to working Scots.

This May we must vote to put recovery first for Scotland. This will let us close that output gap and push stimulus to make sure we build back better. With the backing of UK-wide taxpayers and the strength of the sterling currency union, by pooling and sharing resources across the UK, we can avoid inflicting economic self-harm or crippling austerity on our country.

Scotland’s future and Scotland’s prosperity lies in leading, not leaving, the UK.

* I'm a Liberal Democrat member having joined last year from Labour, I was previously Chair and Founder of the YF Devolution and Local Government Committee

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29 Comments

  • Could Mr McKenzie please confirm that the Scottish Government under its existing powers does not have the power to introduce Universal Basic Income.

  • David McKenzie 19th Mar '21 - 9:39am

    Hi David,

    The Scottish Government does have the powers to implement a trial of UBI which is what I’m calling for, see the pledge here: https://www.ubilabnetwork.org/holyrood-pledge

  • Denis Mollison 19th Mar '21 - 12:16pm

    I agree that we should be putting recovery first just now, but we need a better assessment of Scotland’s real deficit than is offered by GERS – https://www.taxresearch.org.uk/Blog/2019/08/21/the-gers-data-is-ludicrous-scotland-does-not-generate-60-of-the-uks-net-fiscal-deficit/
    GERS was introduced by a Conservative government, with the remit to draw up a balance-sheet that would demonstrate that Scotland couldn’t manage on its own.
    Whether we’re thinking of some kind of federalism or how to make the best of independence, we need some unbiased thinking about the options.
    I certainly agree that the depressingly conventional Growth Commission report of the SNP government is not the way to go.

  • It is a well argued article, David, and a UBI trial in Glasgow makes a lot of sense.

  • Jonathan Alexander 19th Mar '21 - 1:41pm

    Great piece David – right behind you (or above you, if you go by the LDV feed 😉

  • @ David McKenzie. I’m afraid you are being a tad disingenuous, David.

    The Scottish Government under the current devolved powers does not have the power to introduce UBI, although the Scottish Government has already announced support for a trial in four local authorities, including Glasgow. They has also state it requires Westminster agreement.

    Westminster’s agreement ? In 2020, “the Chancellor Rishi Sunak told MPs that the government was “not in favour of a universal basic income”, and had “strengthened the safety net for the most vulnerable” by investing in the existing welfare system”. Source BBC News.

  • Lorenzo Cherin 19th Mar '21 - 2:28pm

    David as in raw

    The David here is not being the way you say here sat all. He is calling for trials in areas, he says nothing of the devolved administration possessing the powers you rightly say they do not possess.

    Your constant tirade against UBI reveals you are not always radical. And that it is possible to be on the left and small c conservative.

    I say that as you delight me with your constant fight against inequality. You do not realise UBI is about dignity. All your experience as chair , admirable , of a food bank, has not offered you what it is like to be frustrated in lack of work opportunities and have paid, mean, union represented, public sector pension protected, cruel staff, treat you like dirt in a dole office!

    UBI well funded could abolish the DWP!

    Job done! Even not providing …jobs!

  • Lorenzo Cherin 19th Mar '21 - 2:31pm

    David , this time, McKenzie

    Excellent campaign. You are a welcome addition to this party. If it were not in a state, you ought to get into the parlianent in Holyrood. Like father like son!

  • David McKenzie 19th Mar '21 - 2:46pm

    Many thanks all for the kind comments, glad to be in a party with some many great supportive colleagues 🙂

  • Brad Barrows 19th Mar '21 - 4:21pm

    High, David. The United Kingdom had a pre-covid spending gap between taxes raised and what was spent on public services. Do you believe that the UK can afford to be an independent country?

    Secondly, Be aware that if you consider fiscal transfers between Scotland and the rest of the UK since 1707, Scotland has been a net contributor.

  • @David MCKenzie

    “We know before seeing the full scale of the pandemic that Scotland’s unemployment rate is the worst of all the four home nations (ONS 06/20). Scottish unemployment levels registered a slight drop in quarter four, but I’d expect, especially given the job losses in hospitality and retail, that this will rise again.”

    No need to guess:

    https://www.gov.scot/binaries/content/documents/govscot/publications/statistics/2021/02/labour-market-monthly-briefing-february-2021/documents/labour-market-monthly-briefing-pdf/labour-market-monthly-briefing-pdf/govscot%3Adocument/Labour%2BMarket%2BMonthly%2BBriefing%2B-%2BFeb%2B2021.pdf

    Scotland’s current unemployment rate is significantly below the UK’s and England’s rate, on a par with Wales and worse than N Ireland.

    Scotland’s employment rate is below the UK and England rate and above that for Wales and Northern Ireland.

  • David McKenzie 19th Mar '21 - 6:02pm

    Hireton,

    I quoted the ONS official statistics from June 2020, here’s the article below please tell me how it’s wrong?

    https://www.bbc.co.uk/news/uk-scotland-53061072

  • @David McKenzie

    I’m quoting up to date (December 20200 ONS and LFS Feb 2021) figures from the Labour Market Monthly briefing. Here is an ONS link as well for unemployment as at December 2020:

    https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/regionallabourmarket/december2020

    As you will see. Scotland’s unemployment rate is lower than all of England’s regions except South East England.

    Sorry if they don’t support your argument but there they are. Are you saying they are wrong?

  • We very much do need to focus on recovery, and a great many other things that are fully within the control of the Scottish Government, which have been neglected since we’ve had a government obsessed with ignoring those powers and demanding other ones.

    @ Denis. You seem to be basing your understanding on a Richard Murphy blog. He’s been caught out more than once because he hasn’t done the homework to understand how they work. In fact, he had to admit to not having looked at them properly at one point. His approach is to cast doubt on something by asking questions for which there are answer. Of most concern is his inability to understand sensitivity analyses and his assertion that including some uncertainty estimates with it being all guess-work.

    His audience is the ideological nationalist who is absolutely certain that Scotland’s wealth is being stolen by the English. It’s driven by the same nationalistic exceptionalism that led Brexiteers to convince themselves that the EU were on the rob.

    The SNP have been in power in Scotland for 14 years now, and they’ve used that time to scrutinise and change the rules on how GERS are collated to suit their needs. The methodology has been signed off by the SNP. Both Alex Salmond and Nicola Sturgeon has endorsed the validity of the approach.

    This summary is from someone who understands them much better than Murphy, and who doesn’t accuse Scottish Government statisticians and economists of lying.

    “The original GERS report may have been “Tory-created” 28 years ago, but after 20 years of devolution and 13 years of SNP control, the way the figures are compiled has changed out of all recognition. To claim the numbers are now “engineered to show a false deficit” is to accuse the SNP Government of talking down Scotland’s economy.”

    https://www.these-islands.co.uk/publications/i368/gers_figures_dont_lie_despite_what_independence_supporters_say.aspx

    The funny thing is that the people who are so sure that GERS is all wrong are still somehow convinced they know enough about the Scottish economy to be certain that we’d be richer if we ended Barnett and created new trade barriers with our biggest trade partner.

  • @Brad. Do you have a source for the claim we’ve been net contributors over the length of the union? Every source I’ve seen states the opposite.

    What I have seen is carefully selected data, trimmed around the oil boom, to show that for a period of time we were net contributors. Of course, in any union it should be OK to sometimes be a contributor and sometimes be a benefactor.

    The UK’s structural deficit pre-COVID was about a third of Scotland’s pre-COVID structural deficit. The UK currently benefits from cheap credit due to a good credit rating so a 3% structural deficit is affordable in the long term. It would be more expensive for an iScotland to borrow, so what might start as an 8% structural deficit would grow, especially when you consider the additional costs of setting up a new country, including the creation of a central bank and the massive hit to trade as predicted by the LSE analysis.

    The same analysis showed that Brexit would be bad for trade, but not nearly as bad as Scexit. Even if Scotland did eventually meet the requirement to rejoin the EU.

    But the real question isn’t whether or not Scotland would survive following Scexit any more than it was about whether the UK would survive following Brexit. That’s deflection by nationalists to give the impression that wanting close ties with your neighbours is unpatriotic.

    It’s about whether or not we’ll be poorer, and every sensible analysis shows we will be. Scotland would lose fiscal transfer equivalent to the annual budget of the NHS in Scotland. The SNP needs to be honest about how difficult it would be to maintain the current living standards in an iScotland.

    It seems obvious to me that the SNP know that the best time for their latest push for independence is while people are distracted with COVID, and while people are angry enough with the Tories that they just assume we’ll be better off. The last thing they want is proper scrutiny of the consequences of their proposals.

  • Brad Barrows 20th Mar '21 - 9:14am

    @ Fiona
    Thanks for taking the time to reply.
    Firstly, you repeat the error made by the author of equating Scotland having a fiscal deficit with Scotland receiving a fiscal transfer. My question to you would be: which country of the UK has a fiscal surplus to enable that fiscal transfer to occur? The truth is that all the countries of the UK has a fiscal deficit and in each case this is being financed by borrowing. The UK is borrowing the money and all the UK is responsible for paying it back. Secondly, I do not dispute that the fiscal deficit for Scotland is proportionately larger than for the UK as a whole but these represent the finances of Scotland ‘as part of the UK’. By that I mean that around half of the public expenditure assigned to Scotland in the accounts is ‘done’ by the UK government – and often assigned on a population share of expenditure rather than actual ‘benefit’. For example, the amount assigned as Scotland’s defence expenditure is at least double the amount that an independent Scotland would be likely to require to spend on its defence and, in fact more than double the cost of the current defence footprint in the country.

    Anyway, on the wider point about net transfers over the history of the UK, be careful which analysis you read. For example, one articles of the Treaty of Union required a substantial fiscal transfer to Scotland – that was known as ‘The Equivalent’ and was to compensate Scotland for the fact that Scotland had no National Debt at the time of the Union and was taking on joint responsibility for England’s National Debt. That figure should not be counted as a fiscal transfer in the calculation as it was match by the taking on of a financial liability. Also, be aware that the UK government deliberately created a separate ‘region’ for North Sea oil revenues so that it would disguise the extent to which revenues derived from Scottish waters were flowing to the UK exchequer. Some sources fail to take this into account and therefore reach wrong conclusions.

  • David McKenzie 20th Mar '21 - 11:09am

    Hireton I think you are actually paraphrasing what I wrote, I said ‘We know before seeing the full scale of the pandemic that Scotland’s unemployment rate is the worst of all the four home nations (ONS 06/20). Scottish unemployment levels registered a slight drop in quarter four, but I’d expect, especially given the job losses in hospitality and retail, that this will rise again.’

    I said there was a rise in Q4 like the data you’ve given above from the ONS…

    What I’m saying is the expectation is this will drop again in Q1.

    Not sure what exactly your attempting to pick me up on, when it’s exactly what I said.

  • If Scotland does opt for independence in a second referendum it will face a HUGE problem not mentioned in the article, namely what currency to use post-Scexit.

    Some might argue for Scotland to adopt its own currency – S£ perhaps. The difficulty with that is that ALL financial software would have to be modified to recognise that new currency. Banking software isn’t my field, but at the time of the Greek financial crisis when a return to the Drachma was suggested by many, I read that it was undoable in practice because so much financial software would have to be updated – banks plus, credit card companies and many more. And banking software MUST be absolutely reliable so there would be a lot of testing to be done – not just of individual company systems but of their interactions. In the case of Greece, it was suggested that even if every financial software specialist in Europe was redeployed to the task it would take at least three years.

    Shorter: it’s not going to happen. So, an independent Scotland would have to choose to use another currency – pounds or euros.

    If pounds, I don’t imagine the rUK would be terribly helpful. Alternatively, it might, with the EU’s agreement join the Eurozone or even go all the way and join the EU but neither is a foregone conclusion. Spain, nervous about Catalonia, might well exercise its veto to make a domestic point. Also, I imagine that existing members would want to see it was successfully up and running as a fully independent country before making any commitment however emotionally appealing one in the eye for Boris might be.

    Either way, the outlook for a country that’s a user of currency over which it has no control is bleak. Deficit financing can’t be done by printing money as the UK has done through the covid crisis. Debts will be denominated in someone else’s money and must be repaid in that money, earned by running a trade surplus. IIRC something like 60% of Scotland’s exports go to rUK, trade that would be hit hard by Scexit, so it’s hard to see that running a trade surplus from the off is even remotely doable.

    What we all need – in Scotland and England alike – is a decent government. But to get one we first need a functional opposition – something that neither Labour nor Lib Dems is providing.

  • This article misses the point. The argument for Scottish independence is an emotional one based on mistrust and dislike of the English and some remaining pride in their country. We must put forward a vision of a federal UK that the Scottish people can get behind if they can delete their prejudices and trust us.

  • Be interested to hear how Scotland might lead the U.K. (other than by leaving it and acting as an example of a non-hidebound. class-ridden antiquity) with all of its 50 or so MPs in Westminster?

    Also, Scotland has no national debt, she’s not allowed to borrow, and since it was back in 1951 that she last plumped for a Tory government (when deficits and debts were very different to now) I can’t see any concern for the new free state about inheriting any consequences of things she was unable to control. And then of course there’s reparations for such things, including the list oil monies of the 70s and 80s for sure, but we might also consider there the Highland clearances and the amount that the U.K. was able to borrow (way back when it didn’t happen) to compensate the slavers for losing their – well, chattels. That was such a large debt it was paid off just a few years ago. And everyone in Acotland paid toward that too.

    You see a country stunted by outside government, unable to act because of its historically being plundered and facing another decade of Boris and Rees-Mogg reaction. I see a vital vibrant nation with massive resources (green self sufficiency, whisky, seafood, bit of oil, and an intelligent and resourceful and progressive population.

  • @ Johnmc ” the Highland clearances and the amount that the U.K. was able to borrow (way back when it didn’t happen) to compensate the slavers for losing their – well, chattels. That was such a large debt it was paid off just a few years ago. And everyone in Scotland paid toward that too”.

    I’m not without sympathy to Johnmc’s aspirations for full Home Rule for Scotland, but I would urge him to do his homework to make a more convincing case :

    1. If he read Andy Wightman MSP’s book (a Green MSP until recently, supportive of Scottish Independence) on the Clearances he would find they were led by Scotland’s very own aristocracy… the biggest of whom was the Duke of Sutherland.

    2. On slave ownership, Scotland’s own were pretty active at that too ….. especially Sir John Gladstone (from Leith) , W.E.G.’s Dad, who received the biggest single amount of compensation. And take a look at a lot of Glasgow Street names.

    Maybe Johnny could also look this article up too : “Secret £2.5bn pay-off to Scotland’s slave owners: Effects of …www.sundaypost.com › 6 Nov 2017 — Merchant George Parker, from Ayrshire, was paid £91,000 to free his 1741 slaves from nine sites in British Guiana.

    It all makes UBI (a beneficiary of which will be the present Duke of Sutherland) look like small change.

  • Just a bit more info for wee Johnny :

    George Rainy, great uncle of Adam Rolland Rainy, Liberal MP for Kilmarnock (1906-1911), had a go at both : slavery and the Clearances.

    Using monies from the pay out to former slave-owners following the Slavery Abolition Act 1833, he purchased the islands of Raasay, Rona and Fladda from Clan MacLeod in 1846: he removed from the land twelve townships of ninety-four Gaelic Highlander families to make way for sheep farming, causing mass depopulation and displacement on the islands.

    Hey, ho.

  • Peter Martin 20th Mar '21 - 2:36pm

    @ Johnmc

    “Also, Scotland has no national debt, she’s not allowed to borrow…”

    Neither has England nor Wales, on that basis. Although the central bank is called the ‘Bank of England’ it really should be the ‘Bank of the UK’.

    So what would happen if England, Wales, Scotland, and Northern Island all declared themselves to be independent and debt free? Who would be left holding the bag! A full of UK debt!

    Maybe the UK should present Scotland with a leaving bill? EU style. What do you reckon would be a reasonable amount?

  • Joseph Bourke 20th Mar '21 - 3:04pm

    The Anglo-Irish treaty of 1922 established a precedent for allocation of UK public debt https://cain.ulster.ac.uk/issues/politics/docs/ait1921.htm Article 5 states “The Irish Free State shall assume liability for the service of the Public Debt of the United Kingdom as existing at the date hereof and towards the payment of war pensions as existing at that date in such proportion as may be fair and equitable, having regard to any just claims on the part of Ireland by way of set-off or counter-claim, the amount of such sums being determined in default of agreement by the arbitration of one or more independent persons being citizens of the British Empire.”
    However, as this article notes https://www.theirishstory.com/2011/01/25/life-and-debt-%E2%80%93-a-short-history-of-public-spending-borrowing-and-debt-in-independent-ireland/#.YFYMBtJxeUk “The Irish Free State was also released from contributions to UK’s national debt in 1925, in return for foregoing territorial claims to parts of Northern Ireland.”
    Fiona’s makes very valid points but I am not so sure that the issue of independence vs home rule will be determined by economic arguments as against culture/nationalist sentinment.
    Gordon raise the important pouint about the currency that would be adopted by an independent Scotland. Again Irish history is relevant as described in this article https://www.imt.ie/opinion/guest-posts/gun-money-war-and-farts-for-the-bishop-11-11-2009/. After the victory of William of orange at the Battle of the Boyne the Bank of England was established and paper notes promising to pay the bearer the face value of the note in gold were readily accepted. Not so the brass coins minted by the defeated James II which became worthless. Representative money is only as good as the confidence that the public has that it can be exchanged for real goods and services and will hold its value at least in the short-term.

  • @Brad – it’s the South East of England which are the net contributors. Many parts of England, along with Wales and Northern Ireland are also net benefactors. We can still have a fiscal transfer despite the UK and England having a deficit.

    The fiscal transfer is not the cause of the structural deficit. It’s what allows the structural deficit to be afforded.

    Scotland doesn’t have debt, because the fiscal transfer balances the books. Remember, deficit and debt are not the same thing. It’s worrying how many politicians, especially in the SNP who equate the two. I expect some are deliberately muddying the waters, but there are definitely some who don’t know the difference. We need to be better than that.

    I made a point of talking about the structural deficit, rather than deficit in general terms. We are running a massive deficit due to COVID, but that’s not structural. It’s the difference between debt incurred for a wedding or funeral rather than daily essentials, such as rent and food.

    A lot of defence spending is done IN Scotland. So it employs people in Scotland directly and indirectly. So even if you think the defence budget is too high, cutting it is not that straight forward. Some activists seem to think that anything that’s reserved shouldn’t be counted – but that’s things like pensions and overseas aid. Not forgetting that a lot of reserved funding is already spent here, such as network rail and research grants.

    If it were that easy to explain how the £15bn per year could be saved post-Scexit, then why are the SNP so keen to avoid that conversation? Instead, they leave it to arm’s length activists to belittle the official Scottish Government figures endorsed by economists and so on. Why did their “Growth Commission” report reveal we’d need year on year austerity in excess of anything experienced by the rest of the UK?

  • @davidmckenzie

    “Not sure what exactly your attempting to pick me up on, when it’s exactly what I said.”

    You said that Scotland had the worst unemployment rate of of all four UK nations quoting summer 2020 figures and you speculated about the future.

    Th latest figures show Scotland does not have the worst unemployment rate of the four UK nations and has a lower rate than all the English regions except SE England.

  • Peter Martin 20th Mar '21 - 4:01pm

    “Not so the brass coins minted by the defeated James II which became worthless.”

    As you’ve said, yourself. James II lost. If he’d won the coins wouldn’t have become worthless. The Confederate dollar also became worthless after their defeat in the US civil war. Confidence comes with winning, if you want to look at it this way. This is also entirely consistent with the MMT view that a fiat currency is effectively a tax voucher. If there’s no government to have to pay taxes to, if they’ve ceased to exist after a physical conflict, then naturally their vouchers become worthless.

    Just like Mothercare vouchers would be worthless after they ceased to exist last year.

  • @ Joe Bourke As I understand it, Joe, part of the Anglo Irish Treaty of 1921, (1921, Joe) the Irish Free State (with dominion status and George V as Head of State) accepted both an undefined share of the UK public debt and the redrawing of the Irish boundary by an independent Boundary Commission.

    The consequence of a lack of progress on the latter resulted in The Financial Agreement of 1925 and a debt write-down of 80 percent of Irish Free State G.N.P., the largest relief settlement of the twentieth century.

  • Joseph Bourke 20th Mar '21 - 7:40pm

    Peter Martin,

    a victorious government to collect taxes to is not always a guarantee that a currency will retain its value as the American colonists discovered https://www.latimes.com/archives/la-xpm-1988-12-29-vw-1182-story.html
    The same article speaks of the commemeration of the crossing of the North Sea by Prince William III of Orange with his consort Mary (daughter of King James) and their coronation as king and queen of England.
    I have always found it a bit curious that the glorious revolution is never recognised as an invasion, despite William landing at at Brixham with a fleet that was considerably larger than England had encountered during the Spanish Armada and Mary being part of the usurpation of the House of Stuart.
    The Union of 1707 came in the wake of the Darien disaster. The project was said to be backed by approximately 20% of all the money circulating in Scotland, its failure left the entire Lowlands in substantial financial ruin.
    Some Scottish nobility petitioned Westminster to wipe out the Scottish national debt and stabilise the currency. Although the first request was not met, the second was, and the Scottish shilling was given the fixed value of an English penny. Personal Scottish financial interests were also involved. Scottish commissioners had invested heavily in the Darien project and believed that they would receive compensation for their losses. The 1707 Acts of Union, granted the equivalent of about £100,000,000 in 2020 money to Scotland to offset future liability towards the English national debt.
    So money, debt and the value of the currency played a large part in creating the union. If Scots agree with David McKenzie’s assessment that Scotland’s future and Scotland’s prosperity lies in leading, not leaving, the UK then it is money, debt and the value of the currency that will again determine the issue of independence.

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