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Monday, September 12, 2005

Scotland's true oil wealth was hidden to stop independence.

http://www.theherald.co.uk/politics/46818-print.shtml

Douglas Fraser, in The Herald, 12 September 2005, revealed that Scotland’s true oil wealth was hidden to stop independence.

A secret UK government dossier has now been made public after 30 years.

In the dossier, Labour ministers were told of the powerful case for Scotland becoming independent. Scotland had lots and lots of oil; much more than the public knew.

The dossier was kept secret by Harold Wilson's Labour government to stop Scotland becoming independent.

Most of the dossier was written by a leading government economist in 1974 and 1975.

It explains how:

1. Scotland would have had one of the strongest currencies in Europe.

2. Scotland would have attracted international capital into its banks in the same way as Switzerland.

3. Scotland could quickly become one of Europe's strongest economies with "embarrassingly" large tax surpluses.

4. Oil revenue would "transform Scotland into a country with a substantial and chronic surplus".

As it turned out, by 1980, the official Whitehall projections for oil tax revenue were exceeded nearly 40 times over.

The document refers to how the extent of the Scottish oil boom was being "disguised" by the Department of Trade and Industry.

According to The Herald:

"The dossier details how a split of England and Scotland and a separate Scottish currency would force England into serious economic difficulties comparable to the 1930s slump, as it would have to import oil."

The dossier was released to the SNP under freedom of information laws.

It states that the scale of Scottish surpluses would be "embarrassing . . . and its currency would become the hardest in Europe, with the exception perhaps of the Norwegian kroner".

The SNP (Scottish National Party) said it had cost Scotland £200bn.

"The key part of the dossier was prepared when Edward Heath's Tory government was about to lose power in 1974.

"Much of it was written by Gavin McCrone, one of Scotland's leading economists, who was working for the then Scottish Office.

"The following year – with Labour concerned by the SNP surge in the two elections of 1974, using the slogan 'it's Scotland's oil' – Dr McCrone's projections for independence were circulated to a tight circle of Labour ministers and officials throughout Whitehall.

"Dr McCrone argued that if Scotland were independent with its own currency, it could expect to see incomes rise from a figure then clearly below English levels, probably surpassing its southern neighbour, with sustained growth for at least a decade and an end to "stop-go" cycles.

"When the paper was written, the UK was one year into the European Economic Community, later to become the European Union, and Dr McCrone's analysis pointed out that an independent Scotland would have equal access to all its markets.

"Kenny MacAskill, SNP deputy Holyrood leader, claimed the dossier countered arguments used at the time that 'Scotland's too wee, the oil would run out and that it's not our oil'. He said: 'A whole array of myths and lies have been exposed. This means that the Scottish Office and British government . . . knew the North Sea wasn't going to be dry as a bone by the 1980s, and that it would have transformed Scotland economically, socially and politically.'

"He argued Scotland had missed out on £200bn of revenue as a result of the secrecy of the 1970s. With oil prices at record highs and Treasury revenues from it soaring, the Lothian MSP added: 'The North Sea is half full and not half empty, and oil is back on the Scottish political agenda."'



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