Scottish independence: Westminster pension concern

THE UK Government has raised more concerns about the future cost of pensions and benefits in an independent Scotland in new analysis published by the Department for Work and Pensions.

The DWP analysis raises concerns over Scottish pension spending. Picture: PA

SNP policy pledges and the impact of an ageing population would add about £450 more per working-age person each year over the next two decades, according to the DWP.

The total includes £410 of extra spending on pensioners and £40 more on workers.

The Scottish Government accused Westminster politicians of scaremongering while cutting an estimated £6 billion from welfare north of the border.

Higher proportion of pensioners

The DWP predictions, set out in the latest “Scotland analysis” paper, follow claims by former prime minister Gordon Brown that the pensions bill would be three times the income from oil.

Iain Duncan Smith, the Work and Pensions Secretary, said: “This country has a long history of a strong welfare state, which we can rightly be proud of.

“As part of the UK, Scottish people benefit from this resilient and unified system, which delivers the same support everywhere irrespective of peaks and troughs in economies of the nations or demographic differences.

“Proposals by the Scottish Government would risk the well-being of vulnerable people who are currently supported by this system.

“On top of the ageing population, which is increasing faster in Scotland than the rest of the UK, the Scottish Government are committing to spending even more on wider welfare without saying how they’ll pay for it.”

Scotland’s benefits bill, including childcare and tax credit, totalled £17.7 billion in 2012-13.

Spending was £60 more per person than in the UK as a whole, according to the report.

The UK Government also points to the higher proportion of pensioners in Scotland, which stands at 19.8 per cent compared with 19.2 per cent in the rest of the UK.

The share will rise faster north of the border by the early 2030s, official projections suggest.

Spending on pensioner benefits in Scotland costs almost £80 more per working-age person per year than across the UK.

Alistair Carmichael, the Scottish Secretary in the UK Government, said: “The UK labour market is resilient, adaptable to changes in economic conditions and responsive to new opportunities and challenges.

“As part of the UK, Scotland benefits from the policies that have created these conditions.

“Both the UK and Scotland have flexible labour markets with a wide variety of jobs and working patterns available.

“With record employment in our country, people can move across other parts of the UK, to where there are labour shortages or where to find a job that better matches their skills, ambitions and aspirations.”

‘Social vandalism’

Scotland’s Deputy First Minister, Nicola Sturgeon, criticised the UK Government analysis.

She said: “Welfare spending and pensions are more affordable in Scotland than the UK because they account for a smaller proportion of our tax revenues and national income.

“But now a Tory-led government that Scotland didn’t vote for is dismantling large parts of the post-war welfare state because of its right-wing ideology.

“This is social vandalism on a vast scale and shows why people are worse off when decisions about Scotland are taken at Westminster.”

She said Mr Duncan Smith is afraid to come to Scotland to launch the analysis paper in person - and is using Mr Carmichael as a “human shield”.

Ms Sturgeon added: “Perhaps he is aware of the hypocrisy at the heart of their message today.”