24 March 2016 was to be Scottish Independence Day. So the Scottish Government’s White Paper told us.
It told us other things as well: oil was to remain – “based on industry estimates of production” – constant at $113 a barrel for 5 years; it is now trading in the low $30 a barrel.
And Scots were told on the eve of the referendum that “a surge in investment (in 2017) and the rising price of oil mean that the early years of an independent Scotland are timed to coincide with a massive North Sea oil boom”. Yet Oil and Gas UK now tell us that the North Sea oil and gas industry “stands at the edge of a chasm”, evidenced by Aberdeen based First Oil Expo going into administration.
Consequently the Scottish Government’s projections of oil revenues of between £6.8bn and £7.9bn in the first year of an independent Scotland are no longer realistic. The estimate for revenues between April and September is now £55m.
The consequence of the plummeting oil price has affected Scotland’s trade position with the rest of the UK. Scotland is currently running its highest quarterly trade deficit on record. During the third quarter of last year Scotland imported £4.25bn worth of goods and services more than it exported. John McLaren, Honorary Professor at Glasgow University’s Adam Smith Business School, estimates Scotland may have a trade deficit of £15bn for 2015.
In this context, it’s not surprising to hear that the Scottish National Party does not intend marking what would have been Independence Day, while varieties of Unionists will no doubt seek to make hay.
Will the current, as opposed to the predicted, economic context make any difference to the outcome of the fast approaching Scottish elections on 5 May? Doesn’t look like it. The three most recent opinion polls all have the SNP polling more than 50% of the vote, making them odds-on to return to power with an overall majority.