SNP oil fund plan slammed as ‘fantasy finance’
By David Scott in Edinburgh
06 August 2009
Opposition parties have accused the Scottish Government of ‘financial incompetence’ and ‘fantasy finance’ after Finance Secretary John Swinney set out his case for a North Sea oil fund for the benefit of Scots.
In a discussion paper published on July 30, Swinney argued for a share of tax revenues coming directly from Scottish territorial waters, estimated as amounting to £230bn over the past 30 years. The fund would provide a permanent source of wealth and revenue for future generations.
Swinney said: ‘We want to harness the benefit of oil revenues now for future years. An oil fund can provide greater stability, protect our economy and support the transition to a low-carbon economy.’
Scottish Labour finance spokesman Andy Kerr said the document acknowledged that agreement would need to be reached with the UK Treasury to avoid the Scottish block grant being cut by an equivalent amount to the oil funds.
Kerr said this showed the ‘true financial incompetence of the Scottish National Party’. He added: ‘This is just financial fairyland designed to create a fight with the rest of the UK. The SNP are reduced to using half truths and distortion to try and make the sums add up.’
Scottish Liberal Democrat spokesman Jeremy Purvis recalled that First Minister Alex Salmond had claimed he could have rescued the Scottish banks if there had been a Scottish Central Bank, which he had no power to create. His latest call for a Scottish oil fund was ‘yet more fantasy finance from the SNP’, Purvis said.
The discussion paper admitted that the creation of the oil fund would require appropriate legislative and legal authority but argued that it would be possible under independence or greater fiscal autonomy.
The paper noted the ‘substantial benefits’ Norway and devolved governments in Alberta in Canada and Alaska in the US had gained from similar oil funds.
Swinney said: ‘There is now a consensus that Scotland will benefit from fiscal autonomy. A Scottish oil fund is a prime example of the policy choices fiscal autonomy would allow Scotland to make.’
