Worst growth on record as economy to lag behind the UK

SCOTLAND’S economy is set to lag behind the rest of the UK for five years, with the worst sustained growth since the 1960s.

Economists yesterday issued a stark warning to the Government after the Scottish Fiscal Commission (SFC) predicted the economy will grow at less than 1 per cent per year until 2022.

Its five-year forecast suggests Gross Domestic Product (GDP) growth will be 0.7 per cent in both 2017 and 2018, rising to 1.1 per cent in 2022. This is much lower than the figures the Office for Budget Responsibility has predicted for the rest of the UK, meaning Scotland will have trailed behind for more than a decade if the forecasts are correct.

Mr Mackay did not address the figures when he spoke in parliament yesterday.

Graeme Roy, director of the Fraser of Allander Institute, said: ‘This forecasts sustained low growth, which is unprecedented when you look at the data collected, which is back to the sixties.’

The SFC’s economic forecasts said the outlook for slow growth was ‘driven by slow productivity growth and exacerbated by demographic changes’.

Scottish Conservative economy spokesman Dean Lockhart said: ‘It will mean that Scotland’s economy will have trailed behind the rest of the UK for 14 years.

‘Instead of prioritising economic growth, the SNP has decided to impose higher Nat Taxes on the hard-working people of Scotland. It’s the SNP’s responsibility to grow the economy but it is failing to do so.’

According to Mr Roy, the ‘weak outlook’ is ‘well below Scotland’s average growth rate since the early 1960s’. David Lonsdale, director of the Scottish Retail Consortium, said the forecasts were ‘sobering’.

The SFC forecasts were published as Mr Mackay claimed his Budget was one for ‘fairness and growth’.