Another review of the Barnett Formula. Just what we need, as Scotland slips into a treble dip recession. I think that probably makes six reviews of Scottish spending since the Tory Scottish Secretary, Michael Forsyth, started publishing the GERS figures on spending in Scotland, which was supposed to resolve the matter once and for all. It never did.
Alex Salmond seems to have ignored the call, just as he seems to have ignored the Treasury's demolition job on the Scottish Government's case for "repatriating" corporation tax. Actually, I have some sympathy for Treasury Man in this particular row. Cutting corporation tax would mean a the loss of a large chunk of an independent Scotland's revenues. Unless you subscribe to the neo-liberal view that cutting taxes always increases revenues. That might happen if the Scottish economy were to be galvanised into new business formation. But there is no evidence that a simple cut in ACT would achieve this - even if Europe were to allow Scotland to go down the Irish route of 12% business taxes which is highly doubtful. Many other EU countries resent the "fiscal dumping" implied by Ireland's tax policy.
Still. This does not amount to a coherent case against independence, and nor does it answer the fundamental question of how Scotland can retain capital and investment against the relentless pull of London and the South East. There need to be some oountervailing measures introduced, otherwise Britain's over centralisation will continue unchecked and Scotland will be reduced to a peasant economy based on tourism and whisky.
