Dismal outlook for Scots economy

SCOTLAND’S economy will lag behind the rest of the UK all year as the threat of a second independence referendum creates a ‘potentially corrosive layer of uncertainty’, experts warned yesterday.

Gross domestic product (GDP) is forecast to grow by only 0.9 per cent in 2017, half the 1.8 per cent growth expected for the UK as a whole.

And a report published by the EY Scottish Item Club yesterday revealed that Nicola Sturgeon’s continued threats of holding another divisive vote on separation was affecting businesses across Scotland as well as the economy.

The Scotland’s Stagnating Growth report also claims the SNP’s decision to make middle earners pay more tax north of the Border ‘will make it more difficult to attract’ highly skilled workers to Scotland with unemployment set to rise.

The Scottish Government’s budget will make Scotland the highest-taxed part of the UK by freezing the threshold for the higher 40p rate of income tax at £43,000 instead of increasing it to £45,000 in line with the rest of the UK.

Scottish Conservative economy spokesman Dean Lockhart said: ‘This is another damning report that shows just how much harm has been caused by the SNP’s handling of our economy.

‘While the rest of the UK economy grows, we are on the verge of a recession, and these figures confirm that we are stuck in the “slow lane”.

‘It’s time they took the threat of a second referendum off the table and started concentrating on turning our ailing economy around as soon as possible.’

Economy Secretary Keith Brown said: ‘Despite serious challenges such as the slowdown in the oil and gas sector, the foundations of Scotland’s economy are strong.

‘Unemployment is falling and we are seeing early signs that the situation is improving for North Sea operators.’