Scottish independence: leak reveals SNP fears over finances

Finance minister John Swinney watches Scottish First Minister Alex Salmond during First Minister's Questions at the Scottish Parliament in Edinburgh (PA)

The Scottish government was accused of “covering up” its private fears that it would struggle to pay its bills if next year’s referendum produces a vote in favour of breaking away from the United Kingdom.

Fresh acrimony was injected into the independence campaign after the leak of a paper by John Swinney, the SNP finance minister, which warned colleagues that the nation’s finances – and its ability to afford pensions and public services - would be imperilled by fluctuating oil prices and the cost of an ageing population.

He said the cost of collecting taxes would soar and defence spending would have to be trimmed if Scotland went it alone.

Mr Swinney said: “Demographic pressures will increase the demand for existing public services, particularly but not exclusively in health. Spending on state pensions and public sector pensions is also driven by demographics and is set to rise.”

He raised his concerns over an independent Scotland’s finances in a paper written to Alex Salmond, the First Minister, and other senior SNP figures. It was leaked to the Better Together campaign which opposes independence.

A Scottish Government spokesman said the report demonstrated the depth and detail of its planning for independence, but added: “The document is now around a year old and has since been overtaken by events.”

But Michael Moore, the Scottish Secretary, told The Independent: “It’s no good worrying about these issues behind closed doors but then covering up the concerns in public.”

He added: “People in Scotland have a right to know what would be the impact on their daily lives if Scotland were to leave the UK family.”

Alistair Darling, the former Chancellor who chairs Better Together, said the document was a ‘hammer blow’ to the economic credibility of independence. He said: “In public they tell us oil will pay for everything, but in private they know it won’t. Be it on pensions, public sector jobs or benefits, the nationalists have been caught saying one thing, but planning another.”

Last year a row blew up over claims by Mr Salmond that legal advice supported his argument that Scotland would be an automatic member of the European Union if it pulled out of the UK.

However, his deputy, Nicola Sturgeon, later conceded there had been no specific guidance from Scottish law officers on the subject and the European Commission cast doubt on whether EU membership could be transferred.

The independence battle has intensified in recent months and the Coalition Government is to release a series of detailed policy papers making the case against independence.

Mr Salmond set out plans to declare independence in March 2016 in the event of a vote in autumn 2014 in favour of separation.