Treasury is accused over ‘bogus’ figures
THE Treasury has been caught redhanded trying to “cook the books” in its fiscal analysis of Scottish independence, Alex Salmond has said.
The First Minister’s accusation came after the co-author of research used by the Whitehall department accused it of misrepresenting his work.
Mr Salmond called on UK Ministers to apologise to Patrick Dunleavy, Professor of Public Policy at the London School of Economics, and withdraw their “bogus” figures.
But the UK Government insisted it stood by the analysis and dismissed Mr Salmond’s attack as “chaff” designed to distract people from a “hole in its own figures”.
The FM’s broadside came as both governments in London and Edinburgh today prepare to set out their competing estimates on how much Scots would be better off by remaining part of the UK and in an independent state.
In Edinburgh, Danny Alexander, the Chief Secretary to the Treasury, will present the “Union Dividend” figure, expected to run into several thousands of pounds over the next 20 years.
The First Minister will present the “Independence Bonus” figure, also expected to run into several thousands of pounds over the same period.
Whitehall economists referred to the LSE figures and extrapolated from them that an independent Scotland might have to spend £2.7 billion to establish the 180 public bodies needed to service the new state.
But Mr Dunleavy said the UK Government had badly misrepresented his research, possibly overstating the set-up
costs by as much as 12 times, bringing the costs down to £225 million.
Mr Salmond said it was a devastating verdict on the Treasury figures and totally undermines anything it had to say on the finances of an independent Scotland.
“The Treasury,” said Mr Salmond, “has been caught red-handed trying to cook the books; they should now apologise to the LSE and the authors of the work involved, and withdraw these bogus figures.”
Mr Salmond said Mr Dunleavy’s remarks left the Treasury claims about Scotland’s finances without a shred of credibility.
A Whitehall insider hit back, insisting the Treasury had not misrepresented Mr Dunleavy’s work and its analysis placed the emphasis on the work done by Professor Robert Young based on Quebec setting up an independent state, which put the cost as 1% of GDP, which in Scotland’s case would be £1.5bn or £600 per household. He suggested the SNP Government was creating a smokescreen to mask the fact it had not come up with its own set-up costs.
Extracts from the Whitehall analysis paper, prereleased by the Treasury, specifically refer to the LSE research and that setting up a new government department would cost around £15m.
Noting how the SNP Government’s White Paper referred to 180 institutions that would need to be created or have powers transferred to them, it said: “If this cost were incurred for all 180 institutions, the total cost would be £2.7bn. Given these estimates, £1.5bn is likely to be a favourable estimate of the total costs of setting up new institutions”.
Earlier, John Swinney, the Scottish Finance Secretary, argued Scotland’s share of British debt could be cut by several billion pounds if assets such as embassies and defence equipment could not be shared after a vote for independence.