SNP’s Humza Yousaf takes unfortunate fall off his scooter
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The SNP are demanding a second referendum on taking Scotland out of the UK, despite falling short of a majority at May’s Scottish parliament elections. Instead they have formed a government with the Greens, with Nicola Sturgeon vowing to hold another independence vote when the coronavirus crisis is over.
Scottish nationalists use Brexit as part of their justification for a second vote, as a majority in Scotland voted to remain in the EU while England and Wales backed ‘Leave’.
However, according to David Bannerman, formerly a Conservative MEP for the East of England, Brexit actually makes Scotland quitting Britain less likely.
He tweeted: “I think Brexit kills independence argument; one of my reasons for backing Brexit – to preserve British Union despite many wrongly thinking opposite!
“It would mean being out EU & UK; hard border for 60 percent Scots exports, no Barnett £s, more expensive borrowing, pensions hit.”
Mr Bannerman was reacting to new reports from the Institute for Government (IFG), which warned an independent Scotland would have to make substantial spending cuts.
The IFG warned Scotland would “struggle” to borrow more than three percent of its GDP per year.
As a result, it would be required to raise another £6.5bn-8.5bn, either by raising taxes or cutting spending.
Scotland started the pandemic with a deficit of eight percent of its GDP, which the IFG described as “an outlier among international peers”.
Since the beginning of the pandemic, this has soared to 22 percent of GDP, far above maximum requirement for EU membership.
The IFG warned Scotland would need a “substantial fiscal consolidation – around five to six percent of GDP relative to its current position – over the first few years of independence”.
Responding to the reports, Mr Bannerman said: “The reality of SNP’s mad plans becoming more obvious by the day.”
If Scotland leaves Britain it could mean a hard-border with England, disrupting trade flows.
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Around 60 percent of Scotland’s exports currently go to other parts of the UK.
To apply for EU membership, Scotland would also have to launch its own currency, and pledge to join the Euro and Schengen Zone.
The SNP have said they would carry on using sterling informally in the immediate aftermath of an independence vote.
They then hope to transition to a new Scottish currency.
Thomas Pope, the IFG’s deputy chief economist, warned: “If Scotland were to become independent, it would struggle to borrow much more than three percent per year consistently in normal (non-crisis) times at a low price from international debt markets.
“This would require a fiscal consolidation of four to five percent of GDP compared to the pre-coronavirus fiscal position.
“Even then, Scotland would find it more expensive to borrow than the UK because it would be a smaller country without an established track record.”
Speaking to the Herald Scotland Pamala Nash, who runs Scotland in Union, said the reports strengthen the case for Scotland remaining part of the UK.
She said: “Introducing a new Scottish currency would have devastating consequences for our economy, with a knock-on impact on how much we can spend on hospitals, schools and social care services.
“When our NHS is in crisis and people are waiting hours for ambulances, and we have years of recovery ahead of us following Covid, this proves just how irresponsible the SNP’s separation blueprint really is.
“Individuals would also face higher taxes, as well as uncertainty around their salaries, mortgages and pensions.”
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