Fiscal autonomy amyth unless oil hits $200 a barrel

Labour’s analysis challenges SNP plans

The price of oil must climb back to $200 a barrel beforeSNPplans for full fiscal autonomy add up, according to Scottish Labour.

Frustrated at Scottish Government delays in publishing an updated oil and gas bulletin to reflect the recent price crash, Labour released its own report yesterday validated by independent Scottish Parliament researchers.

The publication came on the day when a report from Aberdeen and Grampian Chamber of Commerce said two-thirds of North Sea operators have cancelled projects due to the collapse of the oil price, which yesterday stood at just over $60 a barrel.

In separate developments at Westminster, the SNP submitted amotion to the Scotland bill to allow the Scottish Parliament to bring in full fiscal autonomy if it wants.

It coincided with a new report from the Office for Budget Responsibility (OBR) which downgraded North Sea oil revenues to just £ 2billion between 2020 and 2040, £34.5billion less than previously estimated.

It added that over the next five years just £3.4billion in tax receipts will be generated offshore.

The Scottish Government downplayed the report, stating the Scottish economy was about far more than just oil.

According to Labour’s analysis, plummeting oil prices could lead to a £9.7billion cut in Scottish Government spending.

To jeers from the SNP benches at Holyrood, Scottish Labour deputy leader Kezia Dugdale said: “This is the oil paper that the SNP government won’t print.

“We would need a global oil price of $200 (£129) to balance Scotland’s books under the SNP’s plans for autonomy.”

When challenged, Deputy FirstMinister John Swinney refused to state what oil price he thought would be needed to balance the books under full fiscal autonomy. Instead he said the government was waiting to see what the implications of the changes to the tax regime in the March budget were before publishing an updated oil and gas bulletin.

Then he turned on Labour stating it should have learned a lesson from its general election thrashing and Ms Dugdale was out of touch with public opinion.

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“Government downplayed the report”

OVER A BARREL: The Office for Budget Responsibility downgraded North Sea oil revenues to just £2billion between 2020 and 2040, £34.5billion less than previously estimated.