Oil fund realism

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From Gavin McCrone’s incisive analysis of the economics of an oil fund comes a glimpse of the electoral future (Perspective, 18 October).

The case for and against it could become part of the first campaign to see if it should become policy for the first government in an independent Scotland.

It would clearly centre around how much the North Sea oil 
revenues should be used to keep taxes down and public ­expenditure up.

The economic circumstances in 2016 cannot be predicted with complete accuracy. But the political parties should be able to say whether they agree with a fund in principle, whether one should be set up immediately, and what might be the fiscal ­implications of that.

Professor McCrone may be right in suggesting that it may be some time before the ­economic climate favours the establishment of a fund.

He has at least laid out the prospectus in a manner the ­politicians should be able to understand. Much of what he writes is predicated on one ­important outcome.

That is that, following a Yes vote in the independence ­referendum, the Westminster government will agree to ­apportion most of the North Sea oil sector to Scotland.

It is by no means certain that it would agree to do so. In fact, a British Chancellor of the Exchequer would be expected to bargain hard to ensure the rest of the UK is not seriously ­disadvantaged in terms of oil revenue income.

The forthcoming Holyrood White Paper should clarify ­exactly what the Scottish ­Government is aiming for.

We should all be realistic enough to understand that is only the start of the bargaining process.

Bob Taylor

Glenrothes

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