SNP case for separatism doesn't add up

SCOTLAND is one of Europe's modern success stories. The economy is strong, public services are improving rapidly, there's a new confidence all around.

It is a confidence based on solid foundations. The Scottish economy has grown in every quarter over the past three years. When other major economies entered recession in the global slowdown of 2001-3 Scotland avoided it. Unemployment is down by 38 per cent, close to its lowest level. Employment is close to record levels and among the highest in Europe.

The future's looking rosy as well, with a rapid transformation towards a high-skill, high-value economy. One in five of all the UK's R&D projects is coming to Scotland.

There's the same progress in Scotland's public services, benefiting from huge extra investment and the leadership of Jack McConnell and the Labour-led Executive. Scotland's 15-year-olds are among the best in the world at maths, science and literacy. With Jack, Scotland led the way on banning smoking in public places. Hundreds of thousands of children and pensioners have been lifted out of poverty.

All this, and a great deal more, has been achieved within the United Kingdom in a new modern partnership between Westminster and the Scottish Parliament. It's a partnership based on history, shared values and a multitude of family links and relationships. Over 400,000 of the Scottish population were born in England, while more than twice as many Scots are now resident in England or Wales.

So it seems a strange time to want to smash apart a Union which is serving Scotland, and the rest of the UK, so well. It's certainly bewildering to set out on such a course on the flimsiest of economic cases.

My conviction that independence is the wrong course for Scotland and the rest of the UK rests on far more than economics. But economic credibility is vital, which is why, in opposition, Gordon Brown and I put such a strong emphasis on establishing Labour's economic credibility when we were seeking to win the trust of the electorate. It is not just that economic competence is vital for the prosperity of families and society as a whole. It's also that the rest of your programme means nothing if you can't afford to fund it.

As I'll be making clear in Oban tomorrow, I think the same obligations should be placed on a party which wants to break up a successful partnership and march Scotland off on its own. The SNP needs to show how Scotland's economy will gain from such a move and show how it will fund its promises. Not for the first time, they fail this test.

The biggest challenge, in fact, for the SNP is not showing how separation will enable them to spend more, as they say they will. It's how they will continue to find the cash to match Labour's spending now.

For Scotland, like Wales, Northern Ireland and many rural parts of England, already receives higher public expenditure per citizen than the UK average. According to the SNP's own figures, there is a 10 billion difference between money spent in Scotland and money raised. That's 4,000 for every family in Scotland met from the UK Exchequer.

This is a simple recognition that it costs more to provide the same standard of infrastructure and public services in areas with more scattered populations. Scotland, with a third of the land mass, close to half the coastline, a large network of island communities but less than 9 per cent of the UK population, certainly qualifies.

But break up the UK, however, then this Union dividend disappears. So before the SNP start to explain how they are going to find the 1.7 billion extra needed to write off student debt, or the additional 1.4 billion to fund the promised cut in corporation tax, they had better explain how the 10 billion shortfall is going to be met.

The SNP answer, of course, is their proposal for an oil fund. Over ten years they say it might reach 90 billion, allowing Scotland to live off the interest. This rests on two large and uncertain assumptions - that oil prices will remain high and production will continue at present levels. It seems a very big gamble, for example, to base your economy policies on a single commodity whose price has fluctuated by a third in recent months and by much more in recent years.

It is not surprising, therefore, that a nationalist MP hinted on the radio the other day that they might have to raise personal taxes. It would be hard-working Scottish families who would pay the price for nationalist recklessness, and it is time the SNP owned up to it.

There is no reason to take these risks, no reason to surrender the strength and stability the UK delivers to all its nations. Scotland, despite all the challenges still to overcome, is prospering within the Union. As the world becomes more interdependent by the day, it's a modern partnership which is working well for all parts of the UK - at home, within Europe and across the world.

All this will be at stake again in the elections next May. Scotland, not for the first time, will have a choice of direction. Twice before Scots have rejected the idea of ripping Scotland out of the UK. I believe the Scots, who know more than most about the importance of community, will again decide that we are stronger together than we are apart.