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Mature debate needed on debt

THE argument that "we wuz robbed" of the North Sea's black gold is not a new one.

The SNP have reminded voters it is Scotland's oil since it started flowing 40 years ago. But today's Jimmy Reid Foundation paper from economists Jim and Margaret Cuthbert manages to bring a fresh twist to a familiar tale.

Not only do the Cuthberts calculate how much Scotland could have saved for the future had it been independent since the oil boom, they also point out that if the rest of the UK hadn't been able to spend the oil revenue to support the economy it would have soon gone bust.

As things turned out, the UK stayed afloat but failed to address its longer term problems. Instead of Scotland having a £150 billion oil fund, a still dysfunctional UK has a £1.4 trillion debt. A clear case, the couple argue, of a shabby, bungling union that now owes some payback.

They also identify the forum to discuss this new take on North Sea oil - the negotiations between a newly independent Scotland and the rest of the UK on dividing debts and assets. Rather than let bygones be bygones, Scotland should demand compensation for the squandering of the North Sea's riches and the UK's failure to establish a Norway-style savings fund. The subtext is that Scotland should be bold and relentless in any such talks.

The Treasury could surprise us. Its announcement last week that the remainder UK would honour its debt in the event of a Yes vote was, on one level, fairly pedestrian. But on another it was intriguing. UK departments, notably the Ministry of Defence with its head-in-the-sand attitude to moving Trident, generally avoid discussing a post-Yes world for fear of lending it credibility. When the Treasury dipped its toe in the water it knew it would cause ripples, but it went ahead with a maturity missing elsewhere in Whitehall.

It shows commonsense can prevail even in the most heated of debates. The more both sides act like adults, weighing arguments rather than weighing into them, the heathier the process will be for the public.

Contextual targeting label: 
Finance

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