Saturday, 28 June 2014

Turning his back on the debacle of his Lib/Dem party in the Euro Elections, Danny Alexander picks up another set of papers from the Treasury and hot foots it to Edinburgh, once again to tell Scots of the doom and gloom which awaits them if they vote for Independence - this time focusing on the start-up costs of an Independent Scotland. 

Of course, as I said in an earlier article, this unflinching mouthpiece of the Tory Government has absolutely no life experience of producing financial figures.  He is simply reading from a script, a mere puppet, whilst his Tory masters pull the strings.

Never has the falseness of his figures been so easily exposed.  Writing in the "Financial Times" on 28 May, Professor Patrick Dunleavy (Politics Professor at the London School of Economics) states "The Treasury figures are bizarrely inaccurate.  I can't see why the Scottish Government couldn't do this for a very small amount of money". 

His intervention overshadows what Treasury officials called "the most serious piece of work we have done since the decision to stay out of the Euro".  Professor Dunleavy goes on to explain how the Treasury worked out the costs.  They took the cost of setting up a new UK Whitehall Department at the 2010 figure of £15,000,000 and multiplied it by a strange figure of 180, which they say the Scots would need – giving a figure of £2.7 billion.  He estimated the true cost to be closer to £200 million.

For a start is it glaringly apparent that an Independent Scotland will not be building UK size departments in the most expensive area of London. Scotland has only 5.3 million citizens compared with 64.1 million for the UK as a whole.  Also, a lot of such well-established departments already exist, and in most cases would only need minor expansion. 

Looking more closely at the numbers game, a major Whitehall Department such as the "Department of Energy and Climate Change" or the "Department of Work and Pensions", have each around 130 Civil Servants. An Independent Scotland will have around a dozen. 

So, where does the figure of 180 Departments come from as the UK Government has only 24? 

One can only assume that some Treasury officer picked up a figure of 180 from the number of "public bodies" mentioned in the Scottish Government's "White Paper", a blunder of unprecedented consequences.  Examples of "public bodies" include organisations such as "NHS Boards", "Scottish Water", or "Scottish Enterprise" down to very small ones like "Quality Meat Scotland" or "Cairngorms National Park". 

So ridiculous are the figures that the Sunday Herald headed its front page on 25 May "Project Fear Bites The Dust – Treasury Caught Wildly Exaggerating Cost Of Independence" and accompanied its excellent article in its centre pages, headlined "Westminster exaggerates cost of setting up indy Scotland ... by 650%", with a picture of a pocket calculator showing "2+2=5".

It is no wonder that the First Minister immediately demanded that the Treasury withdraw a "deeply flawed and deeply misleading" report.  Outlining how ridiculous it was, he went on to say –

"The Treasury are either guilty of a horrendous blunder, or it is a deliberate and deeply dishonest attempt to deceive – either way it leaves the Treasury's analysis without a shred of capability, and either way they should withdraw the misleading claims".  A slight hint of an apology came from Westminster in that they admitted there was a "drafting error", whatever that may mean, but still tried to insist that the final figures were correct.

Exposure of the falseness in the Treasury's figures will give Scots extra confidence to challenge further Scare Stories which are sure to emerge.

One of the most important issues in the cost of Independence which is being ignored by the UK Government is the share of UK assets which Scotland will inherit.  Whilst subject to negotiation, the figure is in the region of £10 billion.