Growth Commission advisor confirms the plan would mean austerity

David Skilling, an advisor to the New Zealand treasury and a key expert behind the Growth Commission report has confirmed that implementation of the plan would mean austerity, and so further cuts to Scotland's public services.

Mr Skilling told the Times that:

“In a crisis you might see small countries running 5 or 6 per cent deficits, but they get it down from that quickly because the economy recovers and there’s spending cuts."

“Scotland would need to move quite quickly to address [the deficit]. You’d need to have a credible pathway, a credible commitment, to get to a sustainable fiscal position within some reasonably compressed timeframe.”

This comes on the heels of an identical sentiment from one of the chief economists at the Institute for Fiscal Studies, David Phillips, who told the Telegraph that:

“It’s a continuation of austerity. If public spending growth is one per cent less than GDP growth, that’s austerity. Half a per cent growth in public spending will feel like the continuation of austerity for quite a few services. You have upward pressure on health and social care spending and foreign aid spending would have to keep pace with GDP.”

Both of these pronouncements can and would be critiqued by economists outside the neoclassical school. But unfortunately the Growth Commission was designed by fundamentally conventional economists like David Skilling, and places the confidence of the financial markets ahead of any meaningful economic independence.

Previously pro-independence economists like Richard Murphy have panned the report for its economic illiteracy, and the fact that Scotland would continue to use the pound, in an arrangement called 'sterlingisation.'

The report has caused headaches for Nicola Sturgeon, who is closer to the SNP's centre, and has repeatedly denied that the report's implementation would mean austerity. But the First Minister has yet to explain how the report will overcome its own internal contradictions - disciplined finances can only mean one thing, and the people who put the report together have made it clear that it means austerity.

Responding to the reports, Scottish Labour economy spokesperson Jackie Baillie said:

“This is another blow to Nicola Sturgeon, who is continuing to lose credibility by defending her cuts commission.

“David Skilling advised on the growth commission – and even he accepts the need for spending cuts to make the Nationalists' plans work.

“With 1 in 4 children living in poverty Scotland cannot afford another decade wasted at the altar of deficit reduction.

“It needs Labour governments in Scotland and in the UK to invest and grow the economy so it works for everyone, with an interventionist industrial strategy and more investment in infrastructure.”

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