Latest Article: Scotland's Indepence might affect UK more than thought previously
Posted by: Imber on Sep 16, 2014
As it is a big for the whole UK’s history with the Scotttish Referendum, there are many questions asked.
If Scotland does separate from the UK, this would mean an £1bn more in debt, leading to higher borrowing costs.
According to research by campaign group Balance the Books, Scottish government bonds would crop 3.07% under current conditions, which is 0.54% more than the UK
Here are some important facts said
"Borrowing under independence would be pricier. It's vital to the fabric of our democracy that this is understood. Scotland would eventually stabilise after emerging from a split. However, a smaller country would always pay more to borrow – even after uncertainty has long blown away," said Adam Kirby, director of Balance the Books.
"The alternative, as part of the UK, is cheaper loan repayments on both public and private debts. That means lower taxes, cheaper mortgages, and better public services. Solidarity can provide where the magic bullet of independence can't – because it makes sense to share our borrowing facilities."
Scottish people will vote in an independence referendum on 18 September, 2014, and will be asked the straight "yes/no" question: "Should Scotland be an independent country?"
Balance the Books' research follows closely in line with the Institute of Fiscal Studies that show Scotland's budget deficit would be 8.3% before the extra effects of higher borrowing costs.
Due to paying more to service debt, after independence Scotland's budget deficit would in fact increase by 0.44 percentage points as a proportion of GDP, without any new spending, said Balance the Books.
"Scotland already spends far more than it takes in tax, even if you include a geographic share of oil. Remaining in the UK would prevent an extra £1bn in austerity," said Kirby.
"But by contrast, ending the Union would actually make the squeeze worse. And that would require some even tougher decisions.
"As a political entity the United Kingdom is not perfect. But as a machine for negotiating better economies of scale, a united Britain is enormously more effective than a divided island."