Wednesday, 2 December 2015

Joan McAlpine in the Daily Record

I wrote an intemperate rant on Facebook today as I didn't have the the time to write a blog post in my normal (I hope) more reasoned style. I've now taken the time to tidy it up and add in the data graphs that illustrate my points.


I had my attention drawn to this piece by SNP MP Joan McAlpine in today's Daily Record

She says politicians are mocking Scotland over the fall in oil prices. Mocking the SNP is not mocking Scotland; it's mocking the SNP. The SNP deserve mockery for basing the economic case for an independent Scotland on oil revenues of £6.8 - 7.9bn a year (when in fact we're now looking at £0.1 - 0.2bn a year).

She suggests Scots deserve an apology. We do - an apology from the SNP for trying to win a Yes vote on the basis of a demonstrably false prospectus.

She says Kez Dugdale appears to blame the SNP for the falling oil price. Kez was actually blaming the SNP for trying to win a Yes vote by making demonstrably (at the time) unrealistic oil revenue projections.

She asserts Scotland will - over a decade - have "lost" £3.9bn under the Tories as we take our share of austerity cuts. The alternative would be of course for us to increase our share of the debt by £3.9bn (at least in the short term - we can debate the pros and cons of Tory austerity another day). The difference between the White Paper "low case" oil forecast and current OBR forecasts over the next decade is c. £67bn (that's right - I haven't missed a decimal point there) - an issue which is literally an order of magnitude bigger than "Tory austerity".


She asks why Labour don't have more to say about that "vindictive attack on our people" - whilst spending the majority of her article attacking Scottish Labour. Joan being Joan we can infer that by "our people" she means Scots - neglecting the fact that we are simply taking our share of the UK's pain. Scots are not suffering more than the rest of the UK, so there's nothing "vindictive" about it. Of course because of Barnett, because of "pooling and sharing", we are suffering far less than we would if her party had fooled us into voting Yes.

She says the "unionist parties" claim the oil slump makes independence impossible. Nobody claims it makes independence economically impossible, merely that the (now undoubted) economic hardship it would cause makes it politically extremely unlikely.

She says "wealth per head in Scotland would be similar to the UK without including oil" and the Yes campaign "always said oil was just a bonus". We surely all see through this by now? By "wealth" she means GDP, from whence our taxes generate revenue. But she ignores the spend per head that (per the Scottish Government's own GERS figures) show us consistently c.£1,700 per head worse off than the rest of the UK without oil. That grosses up to £9bn a year.


We are used to high levels of public spending in Scotland that we simply couldn't sustain were we independent without booming oil revenues. If Joan thinks austerity cuts of £0.4bn pa are unbearable, how on earth would she describe the £9.0bn pa of cuts (or increased taxes) that an independent (or FFA) Scotland would need without oil? Oil is no more a bonus than being able to fund Scotland's entire education and training budget (£7.6bn) is a bonus.

She misquotes Standard & Poors (because she doesn't understand credit ratings) and quotes a credit report made before the oil slump. In fact Standard and Poor's said: "In brief, we would expect Scotland to benefit from all the attributes of an investment-grade sovereign credit [rating]". That means BBB- or higher. There are 8 grades between BBB- and the UK's AAA.

She makes the observation that nobody predicted this level of oil price slump (which is true; not even Standard & Poors did) but ignores the fact that the White Paper low oil revenue forecast was £2 - 5bn higher than the OBR forecasts that existed at that time. That's the Office for Budget Responsibility, the people the UK government rely on - the clue is in the name.
[Here she's simply parroting the line esrtwhile SNP spin-doctor Kevin Pringle was using at the weekend in the Sunday Times - something I covered in detail here]

She asserts the oil price will rise again, ignoring the fact that it's North Sea profit that generates tax revenues ... and that profitability (due to rising extraction costs as fields mature) is in long term structural decline. The last time oil was at $100/bbl was in 2014 and we generated just £2.6bn in oil revenue. The White Paper "low" scenario was for £6.8bn (implicitly in perpetuity) and tax rates have been reduced since then (in an attempt to protect oil industry jobs). Implying the economic case for indy will be repaired by an oil price rise is simply nonsense - even before you factor in the volatility risk.



She rants about the fact there wasn't an oil fund built. This is a point that is as true for the UK as it is for Scotland; it has absolutely nothing to do with the future, with the choices we (whether as the UK or as Scotland) now face. Needless to say if we (the UK) had created an oil fund then we (the UK, including Scotland) would have had to pay higher taxes or enjoyed lower spending to fund it. We were at the party, we drank our fair share.

She talks of a "massive transfer of wealth" from Scotland to the UK. The Scottish Government's own figures show that this is nonsense. We were a massive contributor in the 1980's, on average we've been a large beneficiary since and certainly right now - to adopt Joan's language - there's a "massive transfer of wealth" taking place from the rest of the UK to Scotland. That's how pooling & sharing works.



She asserts (ridiculously) that the UK "would have gone bust" without oil. That statement doesn't even merit a rebuttal.

Finally she suggests an apology is called for. She's right: the SNP and the wider Yes campaign should be apologising for presenting a hopelessly optimistic economic case in their attempt to win a Yes vote. If they'd succeeded the Scottish people would be facing a level of economic hardship that would make current austerity measures seem trivial.

I would also suggest that Joan should apologise for writing this nasty, vindictive, grievance mongering article in a national paper.

44 comments:

Terry Summers said...

Kevin,
prior to Alex Bell's revelations on the optimism of the SNP's economic plan for an Independent Scotland, the politicians responsible for the Yes campaign had a vestige of a claim to excuse the inaccuracy of their financial projections on using best information available to them at the time.
That boat has sailed, and probably left port before the referendum. To continue with this line of argument today, as Bell has said, is deluded at best and at worst it is deliberate mis-information of the Scottish electorate.

rocoham said...

Terry, sorry, but I won't even grant them the benefit of a vestige. They did not use the best figures available, they consistently used only the most optimistic data they could find. They portrayed revenues from a volatile commodity as though they would be guaranteed for all time. They cherry-picked economic data to select periods of years when Scotland's economy looked most healthy and then inferred that that was an ongoing norm. They routinely bullied and insulted anyone questioning their figures as being anti-Scottish. In other words they first invented the propaganda, and ended up apparently believing it themselves. Their economic "case" for independence had been thoroughly dismantled well before the referendum, notably on this blog; Alex Bell has only confirmed what many people were saying all along.

The SNP put forward a false prospectus. They lied, and knew they were lying. They are still lying to this day, as Joan McAlpine demonstrates only too well (although of course she may be found less guilty on grounds of excess stupidity). They deserve no excuses.

Ron Fenton said...

Joan must be looking for a seat in Holyrood or in Westmister

Anonymous said...

Great piece as ever Kevin.

I hope you have written directly to the Daily Record to confront this grotesque misinformation.

Anonymous said...



From the subjects and flavour of the text it sounds like she sourced the bones of the data from the Wings published "Wee Blue Book" which surely everyone (even Joan McAlpine) knows very well is more a work of Fiction than Fact. Something that Kevin has already demonstrated many times too elsewhere on this Blog.

It's well known that McAlpine is a supporter of Wings, its been recorded that she often ReTweets Wings Twitter handiwork too. MacAlpine is also a follower of Tommy Sheridan,attends Hope over Fear rallies and is said to have played the majority part in the writing of the Book "A Time to Rage" with Sheridan himself.

So should we be surprised that attempting to lie and deceive the Public comes so easily ? As time passes we see that these sort of acts appear to a major part of the SNP strategy, just make up a story and keep on repeating it whether it is based on the true facts or not.
Joan McAlpine though is not a lowly unheard of SNP follower though she is an MSP , an ex-First Ministerial aide to Alex Salmond and is currently on the SNP's National Executive Committee , so this is someone at the SNP's top table deliberately using her column in an influential Newspaper (in Scottish terms at least) to attempt to deceive the Public for the SNP's Political Purposes.

She should apologise but most likely won't, but she may once again write another risible piece of blurb to try to convince us that she is right and it's everyone else that is wrong. If she won't apologise for deliberately trying to mislead the Public with SNP propaganda she should resign her column or else the Daily Record should sack her.
Scotland deserves better than to be preached to by these self serving deceivers,liars and propagandists.
For anyone looking for more reading on Joan McAlpines antics some of them can be found here.
https://ahdinnaeken.wordpress.com/category/moan-mcvulpine/

gwilson453 said...

I'm glad you're there Kevin. The time and effort you put into these factual and informative pieces is truly appreciated.

Auld Reekie said...

Excellent Kevin. Great to see someone hold these people to accountable.

Sam Duncan said...

Good stuff as usual, Kevin.

“Mocking the SNP is not mocking Scotland; it's mocking the SNP.”

Of course, that conflation of nation, party, and state is what nationalism is. One can be a patriot, even a seperatist, without being a nationalist, and for years I thought the use of the word in reference to the SNP was simply due to lazy abbreviation of the party's name. But this just keeps on happening. If the SNP is uncomfortable with comparisons to the insidious nationalist movements of the 20th Century, it should stop behaving like them.

bucksboy said...

Thank-you for this article. I grew up on the east coast of the UK, it produced lots of natural gas back then (no, not that kind!) but far less now. This resource and the revenues yielded were shared with the rest of the UK, no ifs, no buts, no bitterness. It was and remains amongst the least well off areas of the UK yet there is no more nor less division between the people there than you would expect, nor any resentment at not having kept more of those rich pickings to itself, and I suspect it is a far happier place as a result.

Braveheart said...

A modest bump for my own effort at fisking Ms McAlpine's fictions.

http://braveheart-braveheartsblog.blogspot.co.uk/

theambler said...

What I find most disappointing is not the grossly incorrect prediction of oil revenue, nor the fact the prediction was based on cherry picked sources; it's the fact the SNP are trying to unfairly pin the blame - not for the first time - on a Union institution. Rather than admit the error and the poor judgement, it turns out it is really the OBRs fault. What happened to this confident nation that takes responsibility for itself? Failure is impossible if every time there is a problem it turns out to be someone else's fault, no matter the mental contortions have to be engaged in to make it so.

Joan McAlpine's article is clearly huffing and puffing drivel, but it is the best that can be expected short of admitting to fallibility.

David GREEN said...

It is seems clear to an outsider, such as myself, that we are firmly in the trench warfare stage of the Scottish independence debate. A major battle took place in the independence referendum, and the battle was decisively lost by the SNP. However, to continue the terminology, this will be a long drawn-out war, in which the likes of Joan McAlpine will need to be defeated as frequently as possible, in what will be small-scale skirmishes. You do an excellent job, Kevin, but what a tedious business it is rebutting SNP propaganda at every twixt and turn. The current SNP memes in circulation seem to include backward stabs at those bits of recent history that don't bear examination: the impact of declining oil revenues, for example, becomes an exercise in the hypothetical; the inaccuracy of the future oil revenue predictions, which makes the SNP and Salmond, as an oil economist, look stupid, has to be churned in with the OBR; and so on. What is striking is that people like Angus Robertson, and presumably Sturgeon, ask for the most detailed operational plans for for future actions in Syria from the UK Government, but seem fundamentally incapable of addressing simple issues in their own future planning for Scotland, such as how will they cope with the revenue shortfall in the event of independence, and what will the new currency be? The lack of detail is on a par with that of the UK Government's in Syria. Which is why I, for one, don't buy Sturgeon's claim for genuine differences of opinion. Sturgeon simply cannot afford a headline such as "Sturgeon supports the Tories in bombing Syria". Whatever her real views, Scottish independence politics simply preclude certain policy options. As for the oil debate, one current SNP meme appears to be that the oil market will turn, and the SNP merely has to play for time before it can balance the books after independence. This ignores the profound impact of the shale oil technology developed in the US, and the fact that more carbon can now be burnt cheaply, than can possibly contained within any realistic climate scenario that is compatible with the world we currently live in. Morally, the Scottish Government should leave the remaining North Sea oil where it currently sits, and devote its efforts to a renewables/nuclear future.

Stuart 64W said...

On the subject of the SNP bombing Syria as raised by Mr Green. They were only too happy to suggest that an independent Scotland would have been willing to do it;

http://www.scotsman.com/news/politics/syria-action-backed-under-independence-salmond-1-3071423

However that was when Westminster voted against taking action.

Now that Westminster is in favour, naturally as sure as night follows day, the SNP are against it, despite their criteria having being met!

It seems the SNP will adopt any stance, no matter how contrary, as long as it is the opposite of what Westminster wants.

However this time I suspect they have scored a major own goal.

As their failure to support the 'Auld alliance' with the French in their hour of need, in favour of playing party games at Westminster, will not have gone unnoticed in Paris.

Thus any hope of an independent Scotland, having a 'Fast track' entry into the EU & NATO may just have vanished.

Something I doubt which has barely registered with the SNP yet....

Neil King said...

I think on this occasion I'd be content to accept a plea from Moan to the lesser offence of gross stupidity and ignorance due to her weak and facile intellect rather than the more serious offence of deliberately deceit. But she should be on notice that the court may not be lenient in future ...

Peter said...

Kevin, I'd love to believe you've spent too much time (and patience) producing a conscientious point-for-point rebuttal of what is - from start to finish - a shoddy and unworthy farrago of outlandish political manipulation.

But congratulations on the, as ever, conscientious piece of work. The likes of which will remain needed for as long as the shoddier types of "narrative" hold sway. (Thanks also to braveheart for the other rebuttal, linked in a previous Comment here.)


Some thoughts to add (and perhaps one qualification?).

1. Your para 5 (main body of text): in general, I might split such a paragraph into two. There is a two-stage development here of one telling blow. Make such points count! :o)

(I don't know if Ms McAlpine's staccato pump of mainly single-sentence paragraphs was her own work, or that of a Record editor desperately trying to create some readability and coherence out of it. Either way, the rattling rant looks almost a parody of tabloid style: treating the reader as a young child, incapable of taking in more than a small bite of simplistic, pseudo-authoritative text at a time. (And yet, a child to be punished with a merciless bombardment of syntho-facts.) I would not recommend that reductionist "style" as a model of anything: but the impact of crisply-separated points is always worth bearing in mind!)


2. You fairly decode "mocking Scotland" as "mocking the SNP". The free & fraudulent interchangeability of "the people" and "the Party" in SNPspeak is by now an ingrained habit.

However, I'd only say beware not to fall into the SNP's preferred terms of engagement!

It's not even "mocking the SNP", in fact. It's "criticising - which all too often includes, exposing - the SNP's (supposed) economic expertise." Since at least four years of experience suggests this is more accurately described as (objectively dubious) ideological fabrication, designed to feed credulous devotees of The Cause the spurious grievance-propelled pabulum mix they are presumed to wish to hear.

Hence exactly, Joan's "(vindictive attack on) our people". The "vindictive attack" part is something the accuser is too well versed in herself. A projection from the mirror, on to "the others".

But what about that "our people"? - Again, if you look without McAlpine's rage at the point of such criticisms, by no means "people in Scotland", not "Scots", nor even "SNP voters" or for that matter, "people who have voted SNP". But in fact "the SNP's economics-shuffling-and-chopping ideologues". These have fully merited the critical attention Ms McAlpine vehemently resents, and more yet. "Our people" ...


3. Ms McAlpine continues to produce polemic of a dire kind: deliberately uninformed on the facts she raises to the point of deliberate ignorance; entirely unscrupulous in content and effect sought; and - almost a magical conjuring trick, this - combining virulent, flimsy accusations against others, with a (majority government party's) false assumption of a morally superior grand victim status.

Confusing its interests as those of the population of Scotland, this party far too often fails to act with any observable sound judgment, repeatedly shuns responsibility of any kind, and instead, compulsively falls to blaming anyone in sight (but itself) for its compounded shortcomings and failures.

And as in the case discussed, caps the lot by a tendency consistently and wilfully to misinform readers.

Anonymous said...

There's a deal of misunderstanding about forecast oil prices here, both the one used for the independence white paper, and what constitutes the UK Government's forecast. On the latter, it is inaccurate to say that the OBR is "the people the UK government rely on," that is only one forecast of a number that different departments use.

This becomes particularly relevant when you discover just how the figure for the white paper was arrived at. The Scottish Government took the 7 leading forecasts, discarded 2 which seemed to be outliers compared to the rest, and then averaged what was left. That was the figure they used - so it's simply false to say they cherry-picked figures, or used only the most optimistic. The figures they used were: ITEM (Independent Treasury Economic Model), Ernst & Young Eurozone Forecast, DECC Fossil Fuel Price Projections, Economist Intelligence Unit, and the US Energy Information Administration. The 2 they didn't use were the OBR and the OECD. It's worth noting that, at the time the paper would have been put together, the OBR had a TERRIBLE track record - and that, whilst it was the only one of the above that forecast a fall, it still had the price at over $95/barrel at the present time. So by no means prophetic of what actually happened, which no-one saw coming.

Kevin Hague said...

Anonymous

You didn't read the blog blog you?

You're simply repeating McAlpine's spin. I'll repeat;

1. It's not just about the price assumption, There are a load of other assumptions required to get from price to revenue and these were clearly hopelessly optimistic - witness how much higher the SG revenue assumption was compared to the OBR despite ostensibly similar price assumptions

2. The UK *does* rely on the OBR for revenue forecasts for the purposes of budgeting and fiscal planning. It's bizarre if you to imply otherwise

3. I highlight that the OBR had (and so far still has) a record of only ever being optimistic - which makes the SG decision to use a low scenario that was still way more optimistic simple indefensible

4. I'm also very clear that the OBR were not "prophetic" - that's why I show the evolution of forecasts. The point (as I make very clearly) is that just saying "everybody was wrong" in no way excuses how spectacularly *more* wrong the White Paper was.

Please read the blog before responding, otherwise your comment looks like that of an SNP staffer sent to post the standard rebuttal in the hope that repeating the same spin will somehow make it stick

rocoham said...

Anonymous, the forecasting methodology you refer to has not only been demonstrated by events to be wildly inaccurate, it was even at the time totally insufficient given the magnitude of the choices resting on it. I don't know the detail behind the scenes but to discard outliers in assessing a volatile commodity is extremely unwise, unless everyone is happy to work on the basis of a "best guess" consensus. To discard any forecast without examining the robustness of its case is foolish; well-reasoned outliers give you a far better picture of possible futures than does any number of self-referring "comfort-zone" middle-of-the-road estimates that don't rock the boat. In fact, given the centrality of oil to iScotland's economic health, it probably would have been wiser to keep the outliers and discard the rest.

That at least would have emphasised the responsibility of developing Plans B, C and D, scenarios that asked some uncomfortable what-ifs, and explored the (many would say obvious) possibility that revenue from oil might decline at some point, possibly sooner rather than later, possibly sharply and possibly long-term. As it was, the desperate desire to make independence as attractive as possible, to sell the no-cost, no-problem "free lunch", meant that only an optimistic of Scotland's oil revenues could be put forward to the public. No caveats, no maybes, we were all guaranteed to be better off from the certainty of abundant and increasing oil revenues, forever.

You would think for something so fundamentally important (only the future of the country) and large-scale in implication that in-depth primary research (not just sourcing figures from others) might have been judged worth the expense, but no. So forecasting figures that could be found to back up the utopian picture were chosen and others which might have inconveniently qualified or challenged it were ignored or dismissed. That is cherry-picking, by the way. It doesn't matter one iota that others might have been using the same wrong and over-optimistic figures; these others were not gambling the future of their country, the prosperity of their people, on those figures. The SNP were. And for that reckless, casual, amateurish willingness to put at risk every person in Scotland and break up the UK in order to realise their own lazy, half-baked ideological nirvana they deserve to be held in utter contempt.

Anonymous said...

You're simply mistaken to say that the OBR forecast is it, as far as the UK govt is concerned. It would be, to use your word, bizarre for both the Treasury and the DECC to run their own forecasts if they weren't actually going to use them, and just rely on the OBR. Both of those were roughly comparable to the figure the Scottish Govt. used, as were the others I've listed (that's how averaging works - some of them were higher) - and the other outlier that they discounted, the OECD figure, had oil at somewhere near £190/barrel!

The difference between the OBR and IWP forecasts was roughly $30/barrel. The difference between the OBR forecast and where we are now is roughly 50% greater than that. Nobody, but nobody, including the industry itself, saw this slump coming: to use the OBR figure as a 'well, they were more right' figure is plain wrong headed, everyone was way off the chart. To use the OBR figure as if they had to some extent seen this coming, and 'if only the Scottish Govt had used their projections everything would have been fine' makes no sense. The figure they came up with was in line with the figures that the main forecasters and the industry themselves were using at that time.

Kevin Hague said...

Anonymous - your persistent determination to miss the point here is strangely compelling to watch.

1. Why do you act as if the price forecast is all that matters when its the revenue forecast that was so indefensible? Revenue is a function of price, extraction costs & production volumes as well as prevailing tax rates - by fixating on price you're conveniently ignoring all the other assumptions which cumulatively produced a ridiculous pair of scenarios. But if you actually read the post you're commenting on you'd know that. Try it some time.

2. With respect, I think you might not understand what the OBR is and the role it plays in ensuring responsible budgets are used by the government of the day. By ignoring the OBR (their *revenue* forecast - stop fixating only on the *price* forecast) the White Paper and the Yes campaign were - by definition - irresponsible.

3. Maybe an analogy will help here. I forecast there's going be 5 mm of rainfall next week and you forecast there's going to be 2 metres. If in fact there's then only 1mm of rainfall, that doesn't make us both equally wrong. If you'd argued that we'd be able to rely on that 2 metres of rainfall for our crop irrigation then you'd have been made to look like a completely irresponsible idiot. To defend your ridiculous forecast by saying "but we both used similar assumptions about average temperatures" would make you look like you are desperately trying to defend the indefensible by focusing on one input assumption instead of the actual forecasts we made.

I will only post further comments from you if you demonstrate that you have read the blog and this comment and are engaging whatever critical faculties you have at your disposal

Anonymous said...

1 Because it's the oil price forecast on which the SNP are constantly attacked. In all the comparisons with the OBR in the blog, it's the price you've talked about.

2 Let me put it another way. Which of ITEM (Independent Treasury Economic Model), Ernst & Young Eurozone Forecast, DECC Fossil Fuel Price Projections, Economist Intelligence Unit, and the US Energy Information Administration, should they have ignored, and what would be the grounds for doing so?

3 Your analogy is deeply flawed: a more relevant one would be to say that I forecast 2m, you forecast 1.75m, and what we got after an unprecedented and unpredicted drought was just less than 1m (these figures being roughly in proportion to the SG, OBR and present figures). That 1.75m figure wasn't arrived at by foreknowledge of the drought: it was just at the lower end of predictions from the assumptions we were all working to at that time. Had the drought (unprecedented and unpredicted) not occurred, there's nothing to suggest that the lower figure would have been the accurate one.

rocoham said...

Anonymous, It Doesn't Matter what other forecasts existed and how much more wrong any one of them was than the White Paper. It really doesn't. What matters is that the Scottish Government deliberately chose to ignore completely the most cautious forecast available to them - apparently for no better reason than it was an outlier - and pitch an entire country's long-term prospects ("Scotland's Future") solely on off-the-peg forecasts that provided a suitably rosy economic picture. The fact that the OBR forecasting had often been wrong by being too optimistic (ie its figures might if anything err on the high side) does not seem to have struck the authors of the white paper as worth considering. They do not appear to have asked what assumptions and data the OBR had been working from. There was no caution, no contingency planning, no responsibility to the people of Scotland, just a wilful blindness to anything that didn't fit the Independence Will Be Perfect narrative (see also EU, Currency Union, etc). The SNP should have exercised far better diligence before putting so many people's interests on the line; that they did not is either incompetent or criminal.

Kevin Hague said...

Fucking hell "anonymous" you are the most persistently obtuse person I have come across in a while. This blog (both this post and the others where I have touched on this topic) consistently makes the point that it's the revenue forecast that matters not the price forecast.

To quote from the Post I made in 2014

The first and most obvious point worth making is that nobody predicted a price crash to today's levels. There are a lot of data points on the chart below but the overall message is simple - the price levels used in the White Paper (blue line) were at the high end of available forecasts at the time but no forecasts were as low as the prices we are now experiencing and expecting (the black line)

[Look at the graph in that post before asserting this statement isn't true.]

So I have always been clear that the price forecast was within reasonable bounds, it's the revenue forecast (as per the post above) that I and many others have consistently taken issue with before and after the referendum.

You assert it's the price forecast that's constantly attacked. No. It. Is. Not. The SNP's response to criticism of the revenue forecast is to talk about the price forecast as you are doing.

Its a transparently pathetic attempt to distract from the central issue - the SNP chose to ignore the OBR and used revenue forecasts that were transparently unrealistic at the time the White Paper was written.

Again I implore you to read the blog post that you're responding to - you risk looking like a dribbling idiot when you assert that the article above these comments only talks about the price - if you read the fucking thing you'd know that the point I make is it's *not* price that matters as much as *profit* - follow the link to my article rebutting Kevin Pringle if you're still struggling with that. In that article I say:

He's relying on the fact that the casual reader will accept this elision, will allow North Sea revenue forecasts and oil price forecasts to be conflated into being effectively the same thing. Well they're not, as we'll come on to see
[...]
What he's actually asserting is that the White Paper oil price assumption of $110 a barrel was at the low end of the DECC assumptions that existed at the time. This is correct - I pointed out as much myself a year ago in "Oil & Gas: When Will We Ever Learn" - but it's not the same price assumption as the OBR were using. In March 2013 (fully 8 months before the White Paper was published) the OBR was assuming $97 for 2016-17 (revised to $97.4 in the OBR's Dec 2013 forecast)

But there'a bigger issue here. By focusing the reader's attention on the oil price assumptions he's distracting us from the actual oil tax revenue assumption. What's often overlooked here is that it's profit from North Sea production that is taxed by HMRC2 - so to get from oil price to North Sea tax revenue you also have to make assumptions about oil production volumes, production costs (hence profitability) and of course effective tax rates. So there are a lot of other assumptions we'd have to understand before we could judge whether the White Paper was in line with "Westminster" assumptions.


Now please in the name of all that's good and holy ... read and think before repeating the same nonsense.

Cheers

Kevin Hague said...

Anonymous: if you want to use proportionally correct figures in the analogy (which is a fair point) then its not 2.0m vs 1.75m as you claims. Rainfall = oil revenue in the analogy (temperature being price)

If your 2m is the Scot Gov high scenario (£7.9bn) then in March 2014 - 6 months before the referendum, and around the time the Scottish Government had re-forecast oil revenues to still support the White Paper (which they continued to defend as "conservative") - the OBR were forecasting £3.1bn ... so 3.1/7.9x2 = 0.78m

If your 2m is the low scenario (an unfair comparison as OBR is a single therefore mid-point forecast) then the correct figure 3.1/6.8x2 = 0.91m

I guess to be fair we should take the mid point: you forecast 2m of rain, I forecast 0.9m.

The most generous interpretation for your case is if we use the £3.9bn OBR forecast in Dec 13 (White Paper was published in November) so you get 3.9/[(7.6+6.8)/2] x 2 = 1.1m.

So your assertion that the correct relativity is 2.0m to 1.75m is absolute horse-shit. Of course you've done that because you are determined to only look at price forecasts not revenue forecasts. Which is the point I have been making all along.

Using our analogy - you're making assertions about the relative difference between the temperature assumptions used not the rainfall forecasts - thereby confirming beyond all
doubt that you've completely missed the entire point.

Bravo.

Jim Robertson said...

Unfortunately there is something so scientology like with Mr. Anonymous. I guess it's a form of nationalism.

Shanksie said...

Kevin I love your blog and the truth it speaks, as a Scot living in England I cannot believe the lies the SNP come out with and think the Scottish people will believe it. In England my friends business and otherwise have always been very clear on Scottish independence they could not really care less one way or another then say, but best all being together with the final comment if you decide to go you 100% go no ties no crying when Tax goes up you have to borrow our Air Force when the Russians are bombing the oil fields etc. etc. So its not a big deal to them much more important things to worry about globally and sitting down here you can see the whole thing very clear without the lies the Daily Record allows to be written or Sturgeon spouts.
To reinforce the comment about the English people not really caring you only have to look at their apathy towards free tuition fees, prescriptions etc. they do not care if it was the other way round the Scots would almost be invading England and how dare they have that privilege.

Please keep up the good work and I appreciate the time it takes from your business to write these blogs just to state the truth.

Jock Tamsons Bairn said...



Mr Anonymous reminds me of the previous poster who used the analogy of "Zombies", its a common trait of Nationalists ...use anything other than the facts to attack the issue and instead provide a diversion to avoid seeing the truth that you don't want to beleive.

They really really don't seem to understand its "Oil Revenues" that matter much more than Oil Price which in itself is only one variable out of many that affect Scottish Government overall income from Oil.

Both BP and Total now expect low Oil prices to last to 2016 and beyond perhaps even falling to mid $20's mark which of course will squeeze "Oil Revenues" even more than now. It was said some time ago that $45-$55 a barrel just doesn't work in the North Sea https://www.energyvoice.com/oilandgas/86268/sir-ian-wood-warns-uk-would-be-biggest-loser-from-decline-in-oil-price/

The Supply glut in Oil could last till 2050 and scupper any further attempts by the SNP to fool the nation again by trying to provide figures that have to be viewed with very rose tinted spectacles for a second time http://scottishpatriots.blogspot.co.uk/2015/11/is-snp-led-indy-2-referendum-finally.html

David GREEN said...

I hope you and your readers enjoyed Peter Jones' vigorous attack on SNP economics in the Scotsman today. The projected budget deficits going forward, post-independence, are increasingly eye-watering. The SNP messages are also at odds with each other. Thus we have Swinney threatening, yet again, to block the Scotland Bill when it reaches Holyrood because the proposed alteration to the Barnett formula consequent upon devolution might result in less income to the Scottish Government. So his flagship solution is independence, which will eliminate the Barnett transfer at a stroke in its entirety. It reminds me of Blazing Saddles ("Give me the money or I'll shoot myself"). This is the guy currently making a laughing stock of the Scottish Government by running the Forth Bridge so badly that it is now closed. Meanwhile, his narcissistic boss is running around pretending to be a Head of State. Keep up the good work, Kevin.

Anonymous said...


Looking at the "Pooling and Sharing " graph, then by chopping up all the parts where we supposedly paid into the UK "massively" in the 1980's and fitting them into the areas under the line where we were net beneficiaries at other periods it still does appear that we have done rather well from the arrangement as it can been seen we alreadly benefitted overall and we are now going into another sparce Oil revenue period where we are going to benefit from the arrangement yet again.

This Document linked here too shows how well the "Rural" regions of Scotland, Northern Ireland and Wales all benefit from being part of the overall Union. Its beyond belief that any polical party would argue otherwise, so any alternate view seems to be all about "being better for the SNP and the people in power" than "Better for Scotland and its general population"

http://researchbriefings.files.parliament.uk/documents/SN04033/SN04033.pdf

Imbecile Heureux said...

Thanks for this blog, and the others you have written on this subject. I am a "yes" voter, and remain pro-independence, but I have no interest in unsound arguments for that position; and this and other posts have more or less persuaded me that the economic case for independence as presented was unsound.

I have a broader worry - and it is a genuine worry - about the position advanced here, however: I have difficulty seeing it as an argument against independence. If it is true that public spending in Scotland is being massively subsidised by the rest of the UK, then this begins to look like a morally unjustifiable transfer of wealth from the lower classes in England and Wales to the upper and middle classes in Scotland (I have in mind here in particular the flagship universal benefits: higher education, prescriptions, etc.; although a similar worry would apply should, for example, parts of the NHS in England and Wales be privatised while remaining public in Scotland).

I can see how "pooling and sharing" might be used to justify those elements of the extra public spend in Scotland that have to do with, e.g. some of the geographic difficulties of service provision up here; but it is much less clear that, for example, a portion of English or Welsh taxes should be spent on the higher education of my children, when this is not reciprocated. However, if right (and I may well be wrong), this has troubling implications for the justifiability of Scotland pursuing a distinct (and more robust) set of welfare policies whilst remaining in the UK. Both sides, it seems to me, risk being caught between an economic rock and a moral hard place.

theambler said...

Imbecile Heureux,

I'm afraid I cannot recall where I read this or the quality of the source, but overwhelmingly London, as opposed to England as a whole, subsidises the rest of the UK. Scotland doesn't do too badly compared with many English regions. I have no problem with the current arrangement.

I do find it highly regrettable that the SNP talk a big game about how awful Westminster is and how badly Scotland does from Union when the numbers say otherwise. I speculate that when next years GERS come out and this reality is revealed in it's full splendour, there is going to be real complaints in England about this. I expect SNP strategists will be happy with this; anything that weakens the Union and sows division is fine with them.

Anonymous said...


Imbecile Heureux (and theambler)
http://researchbriefings.files.parliament.uk/documents/SN04033/SN04033.pdf

I suggest you both copy and paste the link above into another browser window and look at the pages of table inside, its not just simple "England subsidises Scotland" etc . there are lots of "in balancing" between actual regions of England too
Whats clear for a start is that Welsh and Northern Irish Taxes aren't coming to Scotland and why of course should they as they have the same rural expenses to cover as we do. The larger cities and more populated regions are the ones that are economically more effective to provide services to. It's of course just a numbers game, less tarmac to maintain, less miles to hospitals , nearer to ambulances. Fire services etc .
I think when your getting down to worrying about the fact you might be getting slightly subsided education ect you over worrying, you have to remember individuals don't "see this money" themselves it government services that gets them, you could potentially say "my kids have more hardship as they have to walk further to school than english kids. Maybe maybe not but hardly in the third world are we.

When you look at the overall numbers between regions, at the most its a few hundred pounds and often less than that, spread over a year thats not a lot of differnce per individual to eb worth bothering about but at the macro level its important to councils running services with millions of people to cater for.

(I do get your point but you are always going to get some imbalances somewhere in the system as its almost impossible to treat every individual's personal need to thet level but have to manange things by area or region only.)

As a YES voter I'd like your views on those SNP Politicians who say they will grow the "scottish deficit gap" (a gap of 16% of spending budget) when they stated on the White paper that "a good rate of expected growth would be 3.6% of the economy over a measured period of 30 years" (0.6% per year) ie we need 16% so roughly 4 x 30 years = 120 years is the period we are talking about (and that is even if economic conditions allow it) A little unrealistic is it not and in the meantime we have to borrow via debt markets to fill a spending budget that also would need servicing by fees too.
This economic growth figure is presented in Kevin's video presentations which i presume you have already watched ? link here to copy into browser if you haven't
http://chokkablog.blogspot.co.uk/2015/07/chokkablog-videos.html





Imbecile Heureux said...

Theambler,

No need for a reference; your first point seems plausible enough to me. But it doesn't address my worry at all, as far as I can see, which has to do with more robust welfare provisions in one part of the UK, and the transfer of wealth from (amongst others) the poor in other parts to sustain this.

You say you have no problem with the current arrangement. But I can't see how the fact that London subsidizes the same level of welfare provison in the rest of England makes it OK that it also subsidizes e.g. free higher education in Scotland. I suppose my question would be: what would you respond to a relatively poor English taxpayer, who thought this unfair and demanded that this subsidy cease?

My worry, in a nutshell, is that I am not at all sure how I could respond.

rocoham said...

IH, I would say don't vote the Tories in next time, we get the government we elect, for better or worse. In return, perhaps you can tell me what you would say to a poor Scottish taxpayer who suddenly realises that those same higher education subsidies are disproportionately benefiting the more prosperous middle classes and widening the inequality gap in Scotland. And who asks why more poorer students are going into higher education in England than in Scotland.

http://rattle.scot/exclusive-inequality-the-establishment-and-student-funding

Imbecile Heureux said...

Anonymous,

Thanks for the links; I will watch the videos with interest.

I'm not really following how the information presented in the first link addresses my worry, which is specifically that the rest of the UK appears to be subsidising the provision of a raft of benefits to the upper and middle classes in Scotland which are not enjoyed even by the lower classes in England and Wales. This seems to me a morally objectionable transfer of wealth (and probably amounts to significantly more than "slightly subsidised education": if things remain the same, and both my kids go to university, I (or my family) will receive a subsidy of some £54,000 that is simply not available to anyone in England). As I said, I cannot see why this is an argument against independence (as it relies on the perpetuation of a morally objectionable state of affairs).

I have a fairly low opinion of politicians in general, but am not well placed to assess the relative strengths of different economic claims without a detailed engagement with the arguments put forward by both sides (and time is a commodity I lack at the moment). My own reasons for voting yes were largely political, combined with the fact that, if we couldn't afford the current level of public spend in an independent Scotland, then we are probably spending more than is justifiable anyway.

Imbecile Heureux said...

Rocoham,

I am still not following. Whether or not we vote for the Tories doesn't - obviously at least - impact upon the question of the moral justifiability of Scotland providing significant welfare benefits to its middle and upper classes that are not enjoyed, but subsidised, by the English taxpayer.

As to the poor Scottish taxpayer, I would first say that that is an entirely different question, but certainly one worth exploring in much greater detail. I have no tribal commitment to universal free university education (although the problems you identify seem to me to have come not from that policy itself, but the simultaneous decimation of maintenance grants). But I am certainly open to persuasion that the policy as currently operating is unfair.

rocoham said...

IH, yes, we're on separate logical pages, I can see. I, for example cannot understand you when you say "My own reasons for voting yes were largely political". What does that mean? It sounds like those people who say they support independence "in principle", as though that absolved them of the responsibility of thinking about and planning for its real-life consequences for real people (apart from themselves). Or of respecting that others may disagree, or that the greater good may not in fact lie in the principle they hold so dear. That doesn't appear to be your position, though, so what "largely political" reasons motivated you? And how are they distinct from economic, or social or any other sort of reason? And if political, how are they unconnected to the catastrophic collateral damage a Yes result would have caused? To "remain pro-independence" as the full picture of just how much ordinary Scots would have suffered if Yes had prevailed seems (at least to me) at odds with your concern for social justice.

Jock Tamsons Bairn said...


Imbecile Heureux , I'd like to say how refreshing it is to see a Yes supporter here who is being honest , truly considerate of the issues and not merely being obstructive.
(its not the norm, most that i come into contact with don't in the slightest appear to engage with the financial aspects AT ALL and that for me is deeply worrying , considering the crazy figures i'm seeing.)

I think you have highlighted something that was mentioned yesterday, that we are getting some benefits potentially beyond RUK via barnett agreement for block grant (currently in negotiation though). It was pointed out that the Forth Road Bridge Tolls were scrapped when they used to raise more than £12M annually, no tolls now in Scotland whereas elsewhere in UK there are many Toll bridges and Tunnels. I think Kevin may have this in mind when he has the time to write another Blog.

As far as further education is concerned, i don't think theres any hard proof that money coming via barnett is subsidising free Uni education directly, it may be argued that is being paid by direct taxation from Scotland and Barnet money is merely being used to pay for all the "extra costs" for those higher rural costs we incur..not sure its complicated for sure.

You might want to read this link to seeing as how it was written by a REAL academic economist without an axe to grind on any issue.
http://mainlymacro.blogspot.co.uk/2014/09/scotland-and-snp-fooling-yourselves-and.html
It still seems to me far too few Scots really don't understand the financial situation that they would be in if it had been a YES vote and there would have been serious unrest when they really found out because it wasn't what they were being promised, this is the issue of blindly trusting Politicians chasing a dream first and a sensible budget strategy only as a afterthought consideration.
This link was a warning http://www.economicsuk.com/blog/002120.html






theambler said...

rocoham,

Imbecile Heureux also stated that another reason for voting Yes was "if we couldn't afford the current level of public spend in an independent Scotland, then we are probably spending more than is justifiable anyway."

That is intellectually honest and as far removed from fantasy as you can get. We can agree or disagree with it, but it doesn't fly in the face of reality.

Imbecile Heureux said...

Rocoham,

This is again an entirely different set of questions; worthy of attention no doubt, but of no relevance to the point I thought we were discussing. That point was - I thought - at least connected to the OP, but answering these fully would completely derail the thread, something I am keen to avoid.

A couple of quick points:

- From the claim that the economic case for independence as presented was unsound, we are still a number of argumentative steps from your claim that independence would necessarily have caused "catastrophic damage". I am still uncertain about what would have happened, what resources we would have had to deal with, what decisions would have been made about where cuts would fall, how and on whom to increase tax burdens, and the like.
- The distinction between economic and political questions is, I think, a useful one, and not an evasion; nor is it difficult to grasp. To give just one of many examples, the question of how best to avoid becoming implicated in the commission of another international crime in the future weighed heavily on my mind in deciding how to vote (as I'm sure it did on many others). There are of course economic elements to this question, but they were not the elements that featured in my reasoning in this regard.

I do not yet know how the relatively new (to me) information about the economic case presented will factor into my future thinking; I haven't had time to digest it fully yet, nor I am certain of precisely what it entitles us to claim. But given that I hope it will be a good long while before we are asked the question again (although remaining pro-independence at present, I am also pro-respecting-legitimate-democratic-decisions), I have time.

Eric said...

did you receive my comment?

Kevin Hague said...

Eric - well I received this one.

I moderate for spam and abuse so unless you were guilty of either of those then no, haven't received any other comment

Eric said...

OK let me try again...
here is my original post as best asi I can remember (i will try and press publish this time).

Firstly i would like to thank Kevin for his really excellent Blog - i don't know where he finds the time to research all this data.

Some of the articles in this thread were interesting and its good to see some "yes" opinions expressed
My position has always been that my heart yearns for independence but my head rules it out, every time i look at the data.

There are a couple of point I would like to add - An independent Scotland does not necessarily have to be the one that the SNP has - we could for example rent out the Trident base for millions and keep the jobs. Independence does not have to comply with the current SNP vision.
My main concern is that vision. - while they have every right to express it what I really object to is the dishonesty in never addressing the real issues.
If we want to address austerity (whatever that actually means) can we please define what it is?
having done that can we discuss in pound and pence or is it groats or euros what this will cost,
once we know that , lets then define how we are going to pay for it - we cannot just soak the rich- there are not enough of them to pay for it
I have a european IT job and i work from home in east lothian and I am happy to pay my taxes but could do my job elsewhere if the tax burden becomes unreasonable.
The reality is that the government is funded by standard rate tax payer and higher rate tax payers most of whom would not be paying higher rate if that band had historically moved in line with inflation across the UK in 2014 some 4.4million people now pay the 40p rate, up from just 3.02million when the Coalition was to power and 1.35million in 1988

Having said all that i would like a breakdown of where we are in terms of the countries books
If we become independent what would the first budget look like and the next ...
what will that mean to the tax we pay and the services we get - what currency will we use ?
If i get all this information my head can try and understand it and my heart can decide if I want to pay for it

rocoham said...

IH, I’m sorry you found my comments a diversion from the topic under discussion; they were certainly not meant to be. And thank you for the example of a political reason for voting for independence – if I understand it aright I guess a Scotland separated from the UK’s ridiculous pretensions to be a world power could indeed make what you seek more likely, although in practice a great deal would actually depend on the Holyrood government of the day (where the absence of any substantial checks and balances worries me) not getting – ahem – “aroused” by the possibility of playing a military role in world affairs. The temptation to cosy up to the great and powerful appears so hard for our leaders to resist… In other words, if such ambitions were clearly written into a national constitution backed by legal redress I would have some faith in them; I would not expect them to arise naturally from the state of independence on its own nor to be automatically sustained by it.

Which sort of takes me back to Joan McAlpine and my point, which is that the white paper made a great number of claims for what independence would deliver. Its supporters are now suddenly claiming that this was only the basis for discussion rather than a promise, but this was not at all how it was sold at the time. Its wishful thinking about the economic picture for an independent Scotland, together with some scurrilous misrepresentation of how much Scotland was being done down as part of the Union, together with a cavalier dismissal of the potential difficulties that might be faced en route, all added up to a firm promise, a vow in fact, that we would all be better off financially as a separate country without a hitch on the way. Joan McAlpine continues to trot out these falsehoods even now. So I, along with many others, was and remain critical that such an irresponsibly rose-tinted picture was and still is being presented.

But, at least it was a picture, it made an attempt to fit a number of the pieces of the jigsaw together. Where I’m struggling (it’s not you, it’s me) is with people who argue for independence on principle as if the jigsaw of everyday life like jobs and education would somehow then assemble itself perfectly, or who – like yourself? – have a valid reason to vote for independence and as long as that piece is in place have no interest in the rest. I don’t say either of these views are misplaced, just that they are not mine. For me, independence has to represent a means not an end in itself. IT has to work in practice, politically, socially and economically. Self-governance is no better or worse than any other form of governance unless it demonstrably delivers benefits, creates a better society and/or a better world however that is defined. And assuming that a form of representative democracy is the continuing state of things, it is safe to assume that even in an independent Scotland there will be a significant number who can still claim they are not getting the government they voted for, so I am unsure at what scale the innate virtues of independence are presumed to begin and end. [Given the very evident centralising tendencies of the current Scottish government it appears that to them self-governance means only the separation of powers between Scotland and rUK, certainly not empowerment at a local level within Scotland itself.]

So I would argue that whatever rationale someone puts forward for independence they should be obliged to back it up with evidence that it could work in practice for the greater good. What the desired greater good might be should arguably be the first conversation Scotland should be holding with itself, and only then should the best means to achieve it be assessed. Which might be independence, or it might not.

PS On my use of the word “catastrophe”, I actually don’t think it’s that much of an exaggeration. If Scotland had voted to pursue independence based on the white paper, it would now be facing the prospect of severe and long-term economic hardship, if not ruin. There was no Plan B.