Fiscal wisdom

IN YOUR leader (19 January) you comment that “The (GDP growth rate) figures are a reminder that the economies of Scotland and the rest of the UK are intertwined, and that when the downturn in demand and activity is international in nature, there is little one region on its own can do to buck the consequences’’.

You then say that the Centre for Public Policy for Regions analysis concludes that approaches taken by the Scottish and UK governments appear to have made little difference. Neither of these things are true.

Firstly, there are numerous countries or regions in Europe and further afield which have grown because they have chosen different economic paths either over a longer term past, more recently or both. Good examples include Norway and Sweden. This is partly because they are both still focused on manufacturing quality goods, not focused so heavily on financial services and partly because they are not drastically cutting spending as the UK is.

Secondly, the Scottish Government postponed reducing capital spending for a year and our GDP figures and employment figures held up better for a little longer than the UK as a whole.

If the Scottish Government had control over all tax and spend then they could balance taxes in a way which encourages growth whilst always knowing that any subsequent increase in growth in the economy will result in generating more in tax revenue.

In short, control over balancing the tax system, nothing less, is what is required.

Jonathan Gordon

Gylemuir Road

Edinburgh