By Richard Johnstone | 28 May 2014
An independent Scotland could face as much as £2.7bn in costs to establish the fundamental basics of a new national government, the Westminster administration has claimed, but the figure has been criticised by academics and the Scottish Government.
Publishing a projection for the costs of creating the machinery of government for an independent state, the UK Treasury said that it would require around £15m to set up an individual department. This figure, based on estimates from the Institute for Government and the London School of Economics, could mean costs as high as £2.7bn to replicate the work of the 180 UK government departments and agencies that work in Scotland.
Chief Secretary to the Treasury Danny Alexander said the Scottish Government’s plans for independence did not include details about the ‘set up surcharge’ for an independent Scotland.
UK ministers have already estimated that a new benefit system could cost £400m, while setting up a new tax system could be as much as £562m, Alexander added.
However, one of the researchers behind the IfG and LSE paper said today the UK government had badly misrepresented the research. Patrick Dunleavy, the professor of political science and public policy at the London School of Economics, said £2.7bn had probably overestimated the start-up costs of a new nation by around 12 times.
Most countries in the Organisation for Economic Co-operation and Development have 14 departments, most of which are already in the Scottish Government, Dunleavy said on Twitter. Only four wholly-new departments were needed - defence, foreign, a reorganised Revenue and Customs and a Scottish Department for Work and Pensions.
In addition, the Scottish Government said the figures did not include the country’s share of the UK’s £1.3 trillion public sector assets following a vote for independence on September 18.
Finance Secretary John Swinney highlighted the Treasury’s Whole of Government Accounts for 2011/12, which showed a total public sector estate in the UK worth £745bn and financial assets worth £288bn.
‘Scotland is a wealthy country. Our gross domestic product per person is higher than in France, Japan and the UK and would be the 14th highest in the Organisation for Economic Co-operation and Development,’ Swinney said.
‘The UK Government may not like those figures but the reality is we can not only afford to be independent but we can thrive with independence.
‘Everyone in Scotland has contributed to this £1.3 trillion stockpile of UK assets and Scotland is entitled to a fair share, giving us an even stronger base to build on. With independence we can take control of our own resources, ensure everyone shares in Scotland’s wealth and use the tools of independence to create jobs and opportunities, and boost incomes across Scotland.’
