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Why I Wrote to Alex Salmond

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Exactly a week ago, the Institute for Fiscal Studies released an incredibly thorough piece of research into the economic challenges faced by an independent Scotland. The report concluded, in the words of one of its authors, Gemma Tetlow, that "An independent Scotland would face even tougher choices than those faced by the UK over the longer term."

In plainer terms, an independent Scotland would likely need more spending cuts and tax rises than the rest of the United Kingdom. Even in a best case scenario, the IFS predicted that an independent Scotland would require either a 9% increase in the basic rate of income tax, an 8% increase in the standard rate of VAT, or a 6% reduction in total public expenditure.

One can only imagine the Thick of It-style panic that must have ensued over at SNP HQ.

What then was the SNP's response?

A press release triumphantly proclaiming that the report had reinforced the "fact that Scotland is in a stronger financial position than the UK as a whole."

There was no mention of prolonged austerity, tax rises, the likelihood of North Sea Oil revenues declining (the SNP's illusory knight in shining armour), nor the fact that Scotland's population would age faster than that of the rest of UK.

It was almost as if the actual contents of the report didn't matter. As long as it mentioned the word independence in conjunction with Scotland, the SNP would claim it as yet another sign of the riches, rainbows, and sunshine that would be brought about by a yes vote.

The arc of prosperity, it seems, bends towards an independent Scotland, regardless of the facts.

I expect to find exactly this kind of wishful thinking, obfuscation, and make believe in Tuesday's White Paper in which the SNP will lay out its plans and projections for an independent Scotland.

This is why I have taken the time to write to Alex Salmond to ask fifty fundamental questions his white paper must answer to maintain any semblance of credibility.

So far Salmond and the SNP have ducked and dodged basic queries on crucial issues such as the currency, interest rates, taxation, access to specialist NHS treatment, and defence.

In doing so they have failed in their duty to the Scottish people to speak honestly and openly about the difficult choices and potential risks independence would entail.

It is, therefore, my hope that Tuesday's White Paper will set out as accurately as possible both the potential benefits and difficulties of independence.

I won't, however, be holding my breath.

You can read Lord Foulkes' letter to Alex Salmond in full below

Dear First Minister

Scottish Independence White Paper

As you already know, my preferred outcome for the upcoming referendum on Scottish independence somewhat differs from your own. I and many others believe that Scotland, England, Northern Ireland and Wales are better together than we are apart.

Despite our disagreements on this issue, I also believe that you love and value Scotland, its history, and its people, just as deeply as I do. And it is precisely for this reason that I hope the White Paper on independence your government plans to publish on Tuesday lays out as clearly, accurately, and truthfully as possible the challenges that lay in wait for an independent Scotland.

The Scottish people, I'm sure you agree, deserve nothing less.

Basic questions on Scotland's future prosperity and safety remain unanswered, which is why I have taken the time to list fifty fundamental questions the White Paper must answer to maintain its credibility and to do justice to our fellows Scot, who value, above all, an open and honest debate about this country's future.

I eagerly await your reply and that of your government.

Yours Sincerely,

Lord Foulkes of Cumnock

Former Minister of State for Scotland, MSP, and MP for Carrick, Cumnock & Doon Valley

Questions

1. Does the First Minister accept that an independent Scotland would face a "tougher long-run fiscal challenge than UK as a whole", as reported by the IFS?

2. If not, does the First Minister accept that an independent Scotland would face any squeeze on its public finances whatsoever?

3. If so, can the First Minister outline any specific cuts he'd make to public expenditure?

4. Alternatively, can the First Minister tell us which departments will be protected from spending cuts in an independent, SNP-led Scotland?

5. Can the First Minister categorically deny that he will raise the basic rate of income tax or the standard rate of VAT should Scotland become independent?

6. Having previously accepted (albeit in a private memo) the price volatility of fossil fuels such as oil in making the case for Scotland developing more renewable sources of energy, does the First Minister not consider it a risk to base large public spending commitments on the high prices he claims North Sea Oil will manage to generate in the medium and long term?

7. The First Minister likes to emphasize how economically different an independent Scotland would be from the rest of the United Kingdom. Accepting, for a second, the First Minister's premise, does he accept that sharing a central bank (responsible for the same currency in both the UK and an independent Scotland) would only be repeating the mistake made by the Eurozone, whereby interest rates would apply to wholly different economies with wholly different needs and circumstances?

8. If the First Minister does not accept that financial instability could result from such an arrangement, can he tell us why such a scenario would be different from that which occurred in the Eurozone?

9. Does the First Minister accept that any currency union with Britain would significantly or notably constrain the economic policies an SNP-led independent Scotland would be able to pursue?

10. Does the First Minister also accept, given the United Kingdom's larger economy and population, that a shared central bank would inevitably reflect in its monetary policy the economic realities and needs of Britain as opposed to an independent Scotland?

11. If so, wouldn't such an arrangement limit the economic independence and prosperity of an independent Scotland?

12. Have the SNP made contingency plans should the UK not accept currency union with an independent Scotland?

13. Have the Scottish Government calculated the impact such a decision would have on the Scottish economy?

14. Since the Cabinet Secretary for Finance has ruled out an independent Scotland joining the Euro, are we to assume the Scottish Government has explored in detail, and found appealing, the prospect of a new national currency, should Britain reject proposals for a shared pound?

15. What risks does the First Minister foresee were an independent Scotland to adopt its own currency?

16. Has the Scottish Government consulted with Scottish businesses and trade unions on the possible impact of a shared pound or new currency?

17. The IFS have claimed that high net inward migration would form an integral part of any strategy to reduce an independent Scotland's considerable budget deficit. Does the First Minister, therefore, accept the need for high net inward migration in an independent Scotland?

18. If so, have the First Minister, and his cabinet colleagues, discussed the impact of such migration on wages and public services?

19. Does the First Minister accept the "real risk", highlighted by the IFS, of Scotland facing higher rates of borrowing than the UK?

20. Does the First Minister accept, as most independent forecasters do, that the average age of the Scottish population will increase more rapidly than for the UK as a whole, placing significant upward pressures on many areas of public spending, including healthcare and pensions?

21. The Scottish Government's own economic advisors believe that tax increases, increased borrowing, or reduced public spending would be necessary in order to establish an oil fund. What specific reasons does the First Minister have for rejecting their analysis?

22. Can the First Minister categorically promise the Scottish people that the establishment of an oil fund would not lead to higher taxes, reduced public expenditure, or increased borrowing?

23. Does the First Minister acknowledge the possibility of BAE Systems closing its two Scottish shipyards in the event of independence?

24. Have the First Minister and the Scottish Government sought assurances from BAE Systems regarding such a scenario?

25. Does the First Minister accept, given that he has agreed to allocate £2.5 billion to fund an independent Scotland's defence and security, that he has in effect promised to spend less on defence and security per person in Scotland than is currently spent by the UK Government?

26. If so, can he insure the same level of security as is currently provided for considerably less money?

27. The House of Commons Select Committee on Scottish Affairs was unable to identify any defence supplier or product that would benefit from Scottish independence. Has the Scottish Government been able to identify any such products or suppliers?

28. Does the First Minister also accept that the market offered to defence suppliers in Scotland would be negligible in size to that offered by the United Kingdom?

29. Since more than 12,000 jobs in Scotland depend on the defence industry, can the First Minister set out in detail his plans for the defence budget and procurement?

30. Have members of the Scottish government consulted with MI5, MI6, the CIA, and other intelligence agencies, about the challenges a newly formed intelligence agency in Scotland would face?

31. Perhaps more importantly, what discussions have take place between the Scottish Government and British intelligence agencies concerning co-operation and co-ordination in the event of independence, and what conclusions has the First Minister drawn from such discussions?

32. Considering the complexity of security risks, including terrorism, cyber attacks, an increase in organised crime, natural hazards etc, currently facing Britain, does the First Minister foresee any operational dangers inherent in setting up a new and independent intelligence agency that is hugely reliant upon effective coordination with another security agency?

33. If so, what steps will he take to ensure that intelligence sharing works effectively and efficiently?

34. Have the Scottish Government had substantive discussions with NATO regarding an independent Scotland's possible membership of the organisation?

35. Can the First Minister confirm any similar meetings with the European Union regarding the position of an independent Scotland in Europe?

36. Have either NATO or the European Union raised any concerns with the First Minister, or members of his cabinet, regarding the membership and prospects of an independent Scotland?

37. Does the First Minister believe that lengthy negotiations with the European Union over Scotland's membership would negatively affect the Scottish economy?

38. What concessions would the First Minister be willing to make in order to gain membership of the EU, and does he acknowledge that due to the importance of EU membership to the Scottish economy, his bargaining position will be relatively weak?

39. Does the First Minister accept the possibility of an independent Scotland being excluded from the UK Research Councils, and if so, are there contingency plans in place to make sure scientific research in Scotland does not suffer?

40. Does the First Minister accept that independence would lead to reduced levels of university funding, and if so how does he plan on making up for this shortfall?

41. As you know, the SNP has pledged to share the UK pension payment system for a period of time after independence. Have ministers subsequently engaged in lengthy discussions with the Department for Work and Pensions to work out the practicalities of such an arrangement?

42. On the subject of pensions, does the First Minister acknowledge that arrangements whereby the DWP would continuing running the welfare state for a few years after independence, would significantly constrain an SNP-led independent Scotland pursuing any major changes to the benefits system, such as repealing the Bedroom tax?

43. Furthermore, has the Scottish Government received any assurances from the Department of Work and Pensions that it would consent to such arrangements?

44. If not, what plans are in place for an alternative method by which benefits, most notably pensions, would be delivered in an independent Scotland?

45. If consent is denied for the transitional arrangements described above, can the First Minister promise that welfare payments will be made on time in the first full week of an independent Scotland?

46. Similarly, has the Scottish Government engaged in any discussions whatsoever with the Ministry of Defence, Foreign and Commonwealth Office, the Treasury, or the Department for International Development concerning the practicalities of independence?

47. Would Scottish patients requiring specialist treatment of surgery in the United Kingdom have to go through the same bureaucratic process as if they were travelling to another EU member state?

48. If so, do you agree with Macmillan Cancer Support who believe that such a process could take a number of weeks, possibly even months?

49. Has the Scottish Government sought advice from the Department of Health on this issue?

50. Alternatively, has the Scottish Government made plans to develop the specialist capabilities of hospitals in an independent Scotland, and if so how much would such a proposal would cost?

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